UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 20-F
ANNUAL REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO SECTION 13 OR 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2019
Commission File Number: 001‑38032
Ardagh Group S.A.
(Name of Registrant)
Grand Duchy of Luxembourg
(Jurisdiction of incorporation)
56, rue Charles Martel
L‑2134 Luxembourg, Luxembourg
+352 26 25 85 55
(Address of Principal Executive Offices)
David Matthews, Chief Financial Officer
56, rue Charles Martel, L-2134 Luxembourg, Luxembourg
+352 26 25 85 55
Securities registered or to be registered pursuant to Section 12(b) of the Act:
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Title of each class |
Trading Symbol |
Name of each exchange on which registered |
Class A Common Shares, par value €0.01 per share |
ARD |
New York Stock Exchange |
Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:
18,660,768 Class A Common Shares, par value €0.01 per share
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act:
Yes ☐ No ☒
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer”, “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large Accelerated Filer ☐ |
Accelerated Filer ☒ |
Non-Accelerated Filer ☐ |
Emerging growth company ☐ |
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
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U.S. GAAP ☐ |
International Financial Reporting Standards as issued by the International Accounting Standards Board ☒ |
Other ☐ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
Item 17 __ Item 18__
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):
Yes ☐ No ☒
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Group Consolidated Financial Statements – Basis of Preparation |
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Item 1. Identity of Directors, Senior Management and Advisors |
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Item 11. Quantitative and Qualitative Disclosures About Market Risk |
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Item 12. Description of Securities Other than Equity Securities |
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Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds |
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Item 16D. Exemptions from the Listing Standards for Audit Committees |
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Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers |
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F-1 |
Ardagh Group S.A.
1
Except where the context otherwise requires or where otherwise indicated, all references to “Ardagh”, “Ardagh Group”, “Group”, the “Company”, “we”, “us” and “our” refer to Ardagh Group S.A. and its consolidated subsidiaries, except where the context otherwise requires. Ardagh’s operations have the following divisions: “Metal Beverage Packaging” and “Glass Packaging”.
References to legislation are, except where otherwise stated, references to the legislation of the United States of America.
In addition, unless indicated otherwise, or the context otherwise requires, references in this annual report to:
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“Articles” are to the Company’s articles of association; |
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“Beverage Can Acquisition” are to the Group’s acquisition of certain beverage can manufacturing assets from Ball Corporation and Rexam PLC on June 30, 2016; |
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“Brexit” are to the withdrawal of the United Kingdom from the European Union on January 31, 2020; |
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“CCIRS” are to cross currency interest rate swaps; |
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“CERCLA” are to the U.S. federal Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation and Liability Act of 1980; |
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“CGUs” are to cash generating units; |
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“Code” are to the U.S. Internal Revenue Code of 1986, as amended; |
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“CPGs” are to Consumer Packaged Goods companies; |
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“CSDs” are to carbonated soft drinks; |
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“EPA” are to the U.S. Environmental Protection Agency; |
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“EWC” are to the European Works Council of Ardagh Group S.A.; |
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“Exchange Act” are to the U.S. Securities Exchange Act of 1934, as amended; |
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“FATCA” are to the U.S. Foreign Account Tax Compliance Act; |
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“IAS” are to the International Accounting Standards; |
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“IASB” are to the International Accounting Standards Board; |
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“IED” are to the EU Industrial Emissions Directive; |
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“IFRS” are to International Financial Reporting Standards; |
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“IFRS 5” are to Non-current assets held for sale and discontinued operations; |
Ardagh Group S.A.
2
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“IPO” are to the Company’s initial public offering, which closed on March 20, 2017; |
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“IRS” are to the U.S. Internal Revenue Service; |
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“Lean” are to Lean Manufacturing techniques; |
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“Luxembourg Law” are to the provisions of the laws of Luxembourg; |
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“NYSE” are to the New York Stock Exchange; |
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“Parent Company” are to ARD Holdings S.A. and/or, where relevant, one or more of its subsidiaries; |
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“PFIC” are to a passive foreign investment company; |
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“Ppm” are to parts per million; |
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“REACH” are to the European Union’s regulations concerning the Registration, Evaluation, Authorization and Restriction of Chemicals; |
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“Sarbanes-Oxley Act” are to the U.S. Sarbanes-Oxley Act of 2002; |
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“Shareholder Agreement” are to the shareholder agreement dated March 20, 2017, entered into between ourselves and the Parent Company; |
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“Toggle Notes” are to the Parent Company’s Dollar Toggle Notes and Euro Toggle Notes as referred to in “Item 7 – Major Shareholders and Related Party Transactions – Toggle Notes”; |
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“Trivium” are to Trivium Packaging B.V. and/or, where relevant, its consolidated subsidiaries; |
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“U.S. GAAP” are to the Generally Accepted Accounting Principles in the U.S.; |
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“VNA Acquisition” are to the acquisition in 2014 of Verallia North America; and |
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“VNA” are to the Group's U.S. glass packaging business, formerly Verallia North America. |
Ardagh Group S.A.
3
Ardagh Group S.A. (the “Company”), was incorporated under the laws of Luxembourg on May 6, 2011 and is a subsidiary of ARD Holdings S.A.. The Company’s registered office is 56, rue Charles Martel, L‑2134 Luxembourg, Luxembourg. The Company is registered with the R.C.S Luxembourg under number B 160804.
The Company owns no assets other than its direct and indirect ownership of 100% of the issued share capital of holding companies which hold all of our finance and operating subsidiaries.
Group Consolidated Financial Statements – Basis of Preparation
The consolidated financial statements of the Group have been prepared in accordance with, and are in compliance with IFRS and related interpretations, as adopted by the IASB. IFRS is comprised of standards and interpretations approved by the IASB. IFRS and interpretations approved by the predecessor International Accounting Standards Committee have been subsequently approved by the IASB and remain in effect. References to IFRS hereafter should be construed as references to IFRS as adopted by the IASB.
The consolidated financial statements, are presented in U.S. dollar, rounded to the nearest million and have been prepared under the historical cost convention, except for the following:
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derivative financial instruments are stated at fair value; and |
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employee benefit obligations are measured at the present value of the future estimated cash flows related to benefits earned and pension assets valued at fair value. |
The preparation of consolidated financial information in conformity with IFRS requires the use of critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and income and expenses. It also requires management to exercise judgment in the process of applying Group accounting policies. These estimates, assumptions and judgments are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances and are subject to continual re‑evaluation. However, actual outcomes may differ from these estimates. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are discussed in the critical accounting estimates, assumptions and judgments.
The consolidated financial statements for the Group were authorized for issue by the board of directors of Ardagh Group S.A. on February 19, 2020.
In this annual report, unless otherwise specified or the context otherwise requires:
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“$” and “U.S. dollar” each refer to the United States dollar; |
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“€”, “EUR” and “euro” each refer to the euro, the single currency established for members of the European Economic and Monetary Union since January 1, 1999; and |
“£”, “pounds”, “sterling” and “GBP” refer to pounds sterling, the lawful currency of the United Kingdom.
Ardagh Group S.A.
4
This annual report does not constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any securities, including in the United States, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. Specifically, this annual report does not constitute a “prospectus” within the meaning of the U.S. Securities Act of 1933.
The Company routinely posts important information on its website https://www.ardaghgroup.com/corporate/investors. This website and the information contained therein or connected thereto shall not be deemed to be incorporated into this annual report.
This annual report may contain "forward-looking" statements within the meaning of Section 21E of the Exchange Act and Section 27A of the U.S. Securities Act of 1933. Forward-looking statements reflect the Company's current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words “believe,” “expect,” “anticipate,” “will,” “could,” “would,” “should,” “may,” “plan,” “estimate,” “intend,” “predict,” “potential,” “continue,” and the negatives of these words and other similar expressions generally identify forward-looking statements. It is possible the Company's future financial performance may differ from expectations due to a variety of factors including, but not limited to, the following:
(i) global and regional economic downturn; (ii) competition from other metal beverage packaging and glass packaging producers and manufacturers of alternative forms of packaging; (iii) increases in metal beverage cans and glass container manufacturing capacity; (iv) the Company’s inability to maintain relationships with its largest customers or suppliers; (v) less than expected levels of demand; (vi) varied seasonal demands, climate and water conditions, and the availability and cost of raw materials; (vii) currency and interest rate fluctuations; (viii) various environmental requirements; (ix) the Group’s accounting carrying value of its investment in a material joint venture reduces if it incurs losses (x) the Company’s ability to integrate acquired businesses and achieve expected operating efficiencies, cost savings and other synergies; (xi) costs associated with post-retirement and post-employment obligations; (xii) operating hazards or unanticipated interruptions at our manufacturing facilities, including labor strikes or work stoppages; (xiii) retention of executive and senior management.
Any forward-looking statements in this document are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions, expected future developments, and other factors it believes are appropriate in the circumstances. Forward-looking statements are not a guarantee of future performance and actual results or developments may differ materially from expectations. While the Company continually reviews trends and uncertainties affecting the Company's results of operations and financial condition, the Company does not assume any obligation to update or supplement any particular forward-looking statements contained in this document.
This annual report contains certain consolidated financial measures such as Adjusted EBITDA, working capital, net debt, Adjusted profit/(loss), Adjusted earnings/(loss) per share, and ratios relating thereto that are not calculated in accordance with IFRS or U.S. GAAP. Adjusted EBITDA consists of profit/(loss) for the year before income tax expense/(credit), net finance expense, depreciation and amortization, exceptional operating items and share of profit or loss in equity accounted joint venture. Adjusted profit consists of profit/(loss) for the year before total exceptional items, gains/(losses) on derivatives, intangible amortization and associated tax credits. Adjusted earnings per share is calculated based on adjusted profit for the year divided by the weighted average number of ordinary shares in issue.
Non-GAAP financial measures may be considered in addition to GAAP financial information, but should not be used as substitutes for the corresponding GAAP measures. The non-GAAP financial measures used by Ardagh may differ from, and not be comparable to, similarly titled measures used by other companies.
Ardagh Group S.A.
5
Item 1. Identity of Directors, Senior Management and Advisors
Not Applicable
Item 2. Offer Statistics and Expected Timetable
Not Applicable
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Selected financial data |
Summary Consolidated Financial and Other Data of Ardagh Group S.A.
On October 31, 2019, the Group completed the combination of its Food & Specialty Metal Packaging business, operating as part of the Metal Packaging Europe and Metal Packaging Americas segments, with the business of Exal, to form Trivium, a global leader in metal packaging. As a result of the completion of the transaction, the Food & Specialty Metal Packaging business has been reported as a discontinued operation. The Group holds approximately 42% of the ordinary shares of Trivium. As the Group jointly controls both the financial and operating policy decisions of Trivium, the investment is accounted for as a joint venture under the equity method. The following financial data has been restated retrospectively in accordance with IFRS 5. The financial data of Ardagh Group S.A. as of and for the years ended December 31, 2019, 2018 and 2017, are derived from the audited consolidated financial statements included in this annual report. However, the selected financial data as of December 31, 2016 and 2015, and for the years ended December 31, 2016 and 2015 are omitted from disclosure due to the Company not being able to restate such financial data without unreasonable effort and expense.
The summary historical financial data set forth below should be read in conjunction with and is qualified in its entirety by reference to the audited consolidated financial statements included in this annual report and the related notes thereto. The following financial data should also be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” also included in this annual report. Our historical results are not necessarily indicative of results to be expected in any future period.
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Year ended |
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December 31, |
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2019 |
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2018 |
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2017 |
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Income Statement Data (1) |
(in $ millions except margins and per share data) |
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Revenue |
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6,660 |
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6,676 |
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6,390 |
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Cost of sales |
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(5,597) |
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(5,731) |
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(5,387) |
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Gross profit |
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1,063 |
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945 |
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1,003 |
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Sales, general and administration expenses |
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(362) |
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(317) |
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(331) |
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Intangible amortization and impairment |
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(233) |
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(423) |
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(237) |
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Operating profit |
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468 |
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205 |
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435 |
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Net finance expense |
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(659) |
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(479) |
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(638) |
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Share of post-tax loss in equity accounted joint venture |
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(49) |
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— |
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— |
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Loss before tax |
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(240) |
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(274) |
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(203) |
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Income tax (charge)/credit |
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(44) |
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(18) |
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77 |
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Loss from continuing operations |
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(284) |
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(292) |
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(126) |
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Profit from discontinued operation |
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1,742 |
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198 |
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189 |
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Profit/(loss) for the year |
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1,458 |
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(94) |
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63 |
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Ardagh Group S.A.
6
Balance Sheet Data (at year end) |
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Cash and cash equivalents (2) |
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614 |
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530 |
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784 |
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Working capital (3) |
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173 |
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431 |
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569 |
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Total assets |
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8,678 |
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10,314 |
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11,152 |
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Net liabilities |
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(215) |
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(1,509) |
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(1,374) |
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Issued share capital |
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23 |
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23 |
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23 |
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Net borrowings (4) |
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5,910 |
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7,879 |
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8,308 |
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Net debt (5) |
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5,328 |
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7,462 |
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7,825 |
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Other Data |
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Adjusted EBITDA - Group (6) |
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1,499 |
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1,478 |
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1,508 |
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Adjusted EBITDA - Continuing Operations (6) |
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1,173 |
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1,115 |
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1,141 |
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Adjusted EBITDA Margin - Continuing Operations (6) |
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Weighted average number of ordinary shares for basic EPS (millions) |
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236 |
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236 |
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230 |
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Earnings/(loss) per share (basic and diluted) |
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$6.17 |
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($0.40) |
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$0.27 |
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Adjusted profit for the year - Group (7) |
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431 |
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400 |
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423 |
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Adjusted earnings per share - Group (8) |
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$1.82 |
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$1.69 |
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$1.84 |
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Depreciation and Amortization - Group (9) |
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723 |
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714 |
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687 |
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Depreciation and Amortization - Continuing Operations (9) |
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652 |
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599 |
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583 |
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Capital Expenditure - Group (10) |
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612 |
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575 |
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492 |
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Capital Expenditure - Continuing Operations (10) |
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505 |
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467 |
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400 |
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Net cash from operating activities - Group |
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839 |
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855 |
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962 |
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Net cash from operating activities - Continuing Operations |
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698 |
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480 |
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632 |
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Dividend per share (11) |
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$0.56 |
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$0.56 |
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$0.75 |
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(1) |
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The income statement data presented above is on a reported basis and includes certain exceptional items which, by their incidence or nature, management considers should be adjusted for to enable a better understanding of the financial performance of the Company. A summary of these exceptional items included in the income statement data is as follows: |
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Year ended |
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December 31, |
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2019 |
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2018 |
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2017 |
Exceptional Items |
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(in $ millions) |
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Exceptional cost of sales |
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2 |
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108 |
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78 |
Exceptional sales, general and administrative expenses |
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51 |
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17 |
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45 |
Exceptional impairment - goodwill |
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— |
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186 |
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— |
Exceptional operating items |
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53 |
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311 |
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123 |
Exceptional net finance expense |
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203 |
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22 |
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132 |
Share of exceptional items in material joint venture |
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39 |
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— |
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— |
Exceptional items from continuing operations |
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295 |
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333 |
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255 |
Exceptional income tax credit |
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3 |
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(49) |
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(124) |
Exceptional items from continuing operations, net of tax |
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298 |
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284 |
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131 |
Exceptional items from discontinued operation, net of tax |
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(1,527) |
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13 |
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12 |
Total exceptional items net of tax |
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(1,229) |
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297 |
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143 |
For further details on the exceptional items for the years ended December 31, 2019, 2018, and 2017, see Note 4 and Note 5 to the consolidated financial statements of Ardagh included elsewhere in this annual report.
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(2) |
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Cash and cash equivalents include restricted cash as per the note disclosures to the consolidated financial statements included in this annual report. |
Ardagh Group S.A.
7
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Working capital is comprised of inventories, trade and other receivables, contract assets, trade and other payables and current provisions. Other companies may calculate working capital in a manner different to ours. |
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Year ended |
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December 31, |
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2019 |
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2018 |
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2017 |
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(in $ millions) |
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Inventories |
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964 |
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1,284 |
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1,353 |
Trade and other receivables |
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734 |
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1,053 |
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1,274 |
Contract asset |
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151 |
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160 |
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— |
Trade and other payables |
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(1,628) |
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(1,983) |
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(1,988) |
Current provisions |
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(48) |
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(83) |
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(70) |
Working capital |
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173 |
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431 |
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569 |
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(4) |
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Net borrowings comprises non‑current and current borrowings, net of deferred debt issue costs and bond premium/discount. |
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(5) |
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Net debt is comprised of net borrowings and derivative financial instruments used to hedge foreign currency and interest rate risk, net of cash and cash equivalents. (see Item 5. Operating and Financial Review and Prospects— Supplemental Management’s Discussion and Analysis—Liquidity and Capital Resources). |
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(6) |
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To supplement our financial information presented in accordance with IFRS, we use the following additional financial measures to clarify and enhance an understanding of past performance: Adjusted EBITDA, Adjusted EBITDA margin and Adjusted profit. We believe that the presentation of these financial measures enhances an investor’s understanding of our financial performance. We further believe that these financial measures are useful financial metrics to assess our operating performance from period to period by excluding certain items that we believe are not representative of our core business. We use certain of these financial measures for business planning purposes and in measuring our performance relative to that of our competitors. |
Adjusted EBITDA consists of profit/(loss) for the year before income tax expense/(credit), net finance expense, depreciation and amortization, exceptional operating items and share of profit or loss in equity accounted joint venture. Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by revenue. Adjusted EBITDA and Adjusted EBITDA margin are presented because we believe that they are frequently used by securities analysts, investors and other interested parties in evaluating companies in the packaging industry. However, other companies may calculate Adjusted EBITDA and Adjusted EBITDA margin in a manner different from ours. Adjusted EBITDA and Adjusted EBITDA margin are not measurements of financial performance under IFRS and should not be considered an alternative to profit/(loss) as indicators of operating performance or any other measures of performance derived in accordance with IFRS.
Ardagh Group S.A.
8
The reconciliation of profit/(loss) for the year to Adjusted EBITDA is as follows:
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Year ended |
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December 31, |
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2019 |
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2018 |
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2017 |
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(in $ millions) |
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Loss from continuing operations |
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(284) |
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(292) |
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(126) |
Income tax expense/(credit) |
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44 |
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18 |
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(77) |
Net finance expense |
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659 |
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479 |
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638 |
Depreciation and amortization |
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652 |
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599 |
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583 |
Share of post-tax loss in equity accounted joint venture |
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49 |
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— |
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— |
EBITDA from continuing operations |
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1,120 |
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804 |
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1,018 |
Exceptional operating items |
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53 |
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311 |
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123 |
Adjusted EBITDA from continuing operations |
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1,173 |
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1,115 |
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1,141 |
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Profit from discontinued operation |
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1,742 |
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198 |
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189 |
Income tax expense |
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19 |
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26 |
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37 |
Net finance expense |
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4 |
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6 |
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11 |
Depreciation and amortization |
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71 |
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115 |
|
104 |
EBITDA from discontinued operation |
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1,836 |
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345 |
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341 |
Exceptional operating items |
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(1,510) |
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18 |
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26 |
Adjusted EBITDA from discontinued operation |
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326 |
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363 |
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367 |
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Adjusted EBITDA - Group |
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1,499 |
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1,478 |
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1,508 |
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(7) |
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Adjusted profit/(loss) for the year is calculated as follows: |
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Year ended |
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December 31, |
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2019 |
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2018 |
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2017 |
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(in $ millions) |
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Profit/(loss) for the year - Group |
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1,458 |
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(94) |
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63 |
Total exceptional items |
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(1,229) |
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297 |
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143 |
Intangible amortization |
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249 |
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265 |
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264 |
Tax credit associated with intangible amortization |
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(56) |
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(58) |
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(75) |
Loss/(gain) on derivatives |
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9 |
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(10) |
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28 |
Adjusted profit for the year - Group |
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431 |
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400 |
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423 |
Adjusted profit consists of profit/(loss) for the year before total exceptional items (net of tax impact), (gain)/loss on derivatives, intangible amortization and associated tax credits. Adjusted profit is presented because we believe that it accurately reflects the ongoing cost structure of the company. It excludes total exceptional items and (gain)/loss on derivatives which we consider not representative of ongoing operations because such items are not reflective of the normal earnings potential of the business. We have also adjusted for the amortization of intangible assets and associated tax credits, as this is driven by our acquisition activity which can vary in size, nature and timing compared to other companies within our industry and from period to period. Accordingly, due to the incomparability of acquisition activity among companies and from period to period, we believe exclusion of the amortization associated with intangible assets acquired through our acquisitions and total exceptional items allows investors to better compare and understand our results.
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(8) |
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Adjusted earnings per share is calculated based on adjusted profit for the year divided by the weighted average number of ordinary shares in issue. See Note 7 “Earnings per Share” and Note 18 “Issued Capital and Reserves” included in |
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the consolidated financial statements included in this annual report for details on the calculation of weighted average number of shares for the periods presented. |
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(9) |
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Depreciation, amortization and gain/(loss) on disposal of property, plant and equipment. |
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(10) |
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Capital expenditure is the sum of purchase of property, plant and equipment and software and other intangibles, net of proceeds from disposal of property, plant and equipment. |
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(11) |
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See Note 26 “Dividends” of the consolidated financial statements included elsewhere in this annual report for details on dividends on ordinary shares declared and paid. See “Item 8. Financial Information – Dividend Policy” in this annual report for details of our current dividend policy. |
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B. |
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Capitalization and indebtedness |
Not Applicable
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C. |
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Reasons for the offer and use of proceeds |
Not Applicable
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D. |
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Risk Factors |
Our business, financial condition, or results of operations could be materially adversely affected by one or more of the risks and uncertainties described below:
Risks Relating to Our Business
Our customers principally sell to consumers of beverages & food products. If economic conditions affect consumer demand, our customers may be affected and so reduce the demand for our products.
Demand for our packaging depends on demand for the products which use our packaging, which is primarily consumer driven. General economic conditions may adversely impact consumer confidence resulting in reduced spending on our customers’ products and, thereby, reduced or postponed demand for our products.
Adverse economic conditions may also lead to more limited availability of credit, which may have a negative impact on the financial condition, particularly on the purchasing ability, of some of our customers and distributors and may also result in requests for extended payment terms, and result in credit losses, insolvencies and diminished sales channels available to us. Our suppliers may have difficulties obtaining necessary credit, which could jeopardize their ability to provide timely deliveries of raw materials and other essentials to us. Adverse economic conditions may also lead to suppliers requesting credit support or otherwise reducing credit, which may have a negative effect on our cash flows and working capital.
Volatility in exchange rates may also increase the costs of our products that we may not be able to pass on to our customers; impair the purchasing power of our customers in different markets; result in significant competitive benefit to certain of our competitors who incur a material part of their costs in other currencies than we do; hamper our pricing; and increase our hedging costs and limit our ability to hedge our exchange rate exposure.
Changes in global economic conditions may reduce our ability to forecast developments in our industry and plan our operations and costs, resulting in operational inefficiencies. Negative developments in our business, results of operations and financial condition due to changes in global economic conditions or other factors could cause ratings agencies to lower the credit ratings, or ratings outlook, of our short‑ and long‑term debt and, consequently, impair our
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ability to raise new financing or refinance our current borrowings and increase our costs of issuing any new debt instruments.
Furthermore, the economic outlook could be adversely affected by the risk that one or more eurozone countries could leave the European Monetary Union, or the euro as the single currency of the eurozone could cease to exist. Any of these developments, or the perception that any of these developments are likely to occur, could have a material adverse effect on the economic development of the affected countries and could lead to severe economic recession or depression, and a general anticipation that such risks will materialize in the future could jeopardize the stability of financial markets or the overall financial and monetary system. This, in turn, would have a material adverse effect on our business, financial position, liquidity and results of operations. See below “The United Kingdom’s withdrawal from the European Union may have a negative effect on our financial condition and results of operations.”
We face intense competition from other metal and glass packaging producers, as well as from manufacturers of alternative forms of packaging.
Metal Beverage Packaging
The sectors in which Metal Beverage Packaging operates are relatively mature and competitive. Prices for the products manufactured by our Metal Beverage Packaging business are primarily driven by raw material costs. Competition in the market is based on price and, increasingly, on innovation, design, quality and service. Our principal competitors include Ball Corporation, Crown Holdings and Can Pack. To the extent that any one or more of our competitors become more successful with respect to any key competitive factor, our ability to attract and retain customers could be materially and adversely affected, which could have a material adverse effect on our business.
Metal Beverage Packaging is subject to substantial competition from producers of packaging made from plastic, carton and composites, particularly from producers of plastic packaging. Changes in consumer preferences in terms of packaging materials, style and product presentation can significantly influence sales. An increase in Metal Beverage Packaging’s costs of production or a decrease in the costs of, or an increase in consumer demand for alternative packaging could have a material adverse effect on our business, financial condition and results of operations.
Glass Packaging
Glass Packaging is subject to intense competition from other glass packaging producers, as well as from producers of other forms of rigid and non‑rigid packaging, against whom we compete on the basis of price, product characteristics, quality, customer service, reliability of delivery and the overall attractiveness of our offering. Advantages or disadvantages in any of these competitive factors may be sufficient to cause customers to consider changing suppliers or to use an alternative form of packaging. In some instances, we also face the threat of vertical integration by our customers into the manufacture of their own packaging materials.
Our principal competitors in glass packaging include Anchor Glass and Owens‑Illinois in North America and Owens‑Illinois, Verallia and Vidrala in Europe. Additionally, we face competition from firms that carry out specific export operations at low prices when their domestic markets are at overcapacity or when foreign exchange rates or economic conditions (particularly transport costs) allow this, such as has been seen with the importing of glass containers into the United States from lower cost countries. Despite the generally regional nature of the glass packaging markets, these export operations could have a material negative impact on our business, financial condition and results of operations.
In addition to competing with other large, well‑established manufacturers in the glass packaging industry, we also compete with manufacturers of other forms of rigid packaging, principally plastic packaging and aluminum cans, on the basis of quality, price, service and consumer preference. We also compete with manufacturers of non‑rigid packaging alternatives, including flexible pouches and aseptic cartons, particularly in serving the packaging needs of non‑alcoholic beverage customers, including juice customers and food customers. We believe that the use of glass packaging for alcoholic and non‑alcoholic beverages is subject to consumer taste. In addition, the association of glass packaging with
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premium items in certain product categories exposes glass packaging to economic variations. Therefore, if economic conditions are poor, we believe that consumers may be less likely to prefer glass packaging over other forms of packaging. We cannot ensure that our products will continue to be preferred by end consumers and that consumer preference will not shift from glass packaging to alternative packaging. A material shift in consumer preference away from glass packaging, or competitive pressures from our various competitors, could result in a decline in sales volume, or pricing pressure, that would have a material adverse effect on our business, financial condition and results of operations. Furthermore, new threats from container and production innovations in all forms of packaging could disadvantage our existing business. If we are unable to respond to competitive technological advances, our future performance could be materially adversely affected.
Some customers meet some of their metal beverage and glass packaging requirements through self-manufacturing, reducing their external purchases of packaging. For example, AB InBev manufactures metal beverage packaging through its Metal Container Corporation subsidiary in the United States. In glass packaging, companies which satisfy some of their requirements through self-manufacture include AB InBev and Gallo, which manufacture glass packaging in the United States, and AB InBev and Constellation Brands, which produce glass packaging in Mexico. The potential vertical integration of our customers could introduce new production capacity in the market, which may create an imbalance between metal beverage and glass packaging supply and demand. The growth of vertically integrated operations could have a material negative impact on our future performance.
An increase in metal beverage can or glass container manufacturing capacity without a corresponding increase in demand for metal beverage cans or glass packaging could cause prices to decline, which could have a material adverse effect on our business, financial condition and results of operations.
The profitability of metal beverage or glass packaging companies is heavily influenced by the supply of, and demand for, metal or glass packaging.
We cannot assure you that metal beverage can or glass container manufacturing capacity in any of our markets will not increase further in the future, nor can we assure you that demand for metal beverage or glass packaging will meet or exceed supply. If metal beverage can or glass container manufacturing capacity increases and there is no corresponding increase in demand, the prices we receive for our products could materially decline, which could have a material adverse effect on our business, financial condition and results of operations.
As our customers are concentrated, our business could be adversely affected if we were unable to maintain relationships with our largest customers.
Metal Beverage Packaging’s ten largest customers accounted for approximately 65% of its 2019 consolidated revenues. Glass Packaging’s ten largest customers accounted for approximately 41% of its 2019 revenues. Our ten largest customers accounted for approximately 47% of our 2019 continuing operations revenues.
We believe our relationships with these customers are good, but there can be no assurance that we will be able to maintain these relationships. For the Group, approximately three quarters of our sales agreements, for the year ended December 31, 2019, were under multi-year supply agreements of varying terms of generally one to five years. Although these arrangements have provided, and we expect they will continue to provide, the basis for long‑term partnerships with our customers, there can be no assurance that our customers will not cease purchasing our products. If our customers unexpectedly reduce the amount of glass packaging and/or metal cans they purchase from us, or cease purchasing our glass packaging and/or metal cans altogether, our revenues could decrease and our inventory levels could increase, both of which could have an adverse effect on our business, financial condition and results of operations. In addition, while we believe that the arrangements that we have with our customers will be renewed, there can be no assurance that such arrangements will be renewed upon their expiration or that the terms of any renewal will be as favorable to us as the terms of the current arrangements. There is also the risk that our customers may shift their filling operations to locations in which we do not operate. The loss of one or more of these customers, a significant reduction in sales to these customers or a significant change in the commercial terms of our relationship with these customers could have a material adverse effect on our business.
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Further consolidation of our customer base may intensify pricing pressures or result in the loss of customers, either of which could have a material adverse effect on our business, financial condition and results of operations.
Some of our largest customers have previously acquired companies with similar or complementary product lines. For example, in 2016 AB InBev acquired SABMiller and in 2015 Kraft Foods Group merged with H.J. Heinz Holding Corporation. Such consolidation has increased the concentration of our net sales with our largest customers and may continue in the future. In many cases, such consolidation may be accompanied by pressure from customers for lower prices. Increased pricing pressures from our customers may have a material adverse effect on our business, financial condition and results of operations. In addition, this consolidation may lead manufacturers to rely on a reduced number of suppliers. If, following the combination of one of our customers with another company, a competitor was to be the main supplier to the consolidated companies, this could have a material adverse effect on our business, financial condition or results of operations.
A significant write down of goodwill would have a material adverse effect on our financial condition and results of operations.
Goodwill at December 31, 2019 totaled $1.6 billion. The Company evaluates goodwill annually (or more frequently if impairment indicators arise) for impairment. The valuation methods used include those requiring the use of a weighted average cost of capital to calculate the present value of the expected future cash flows of the Company’s groups of cash generating units. Future changes in the cost of capital, expected cash flows, or other factors may cause the Company’s goodwill to be impaired, resulting in a non‑cash charge against results of operations to write down goodwill for the amount of the impairment. If a significant write down is required, the charge would have a material adverse effect on the Company’s financial condition and results of operations.
Our profitability could be affected by varied seasonal demands.
Demand for Metal Beverage Packaging’s and Glass Packaging’s products is seasonal. Metal Beverage Packaging’s sales are typically greater in the second and third quarters of the year, with generally lower sales in the first and fourth quarters. Unseasonably cool weather during the summer months can reduce demand for certain beverages packaged in metal beverage cans.
Demand for our Glass Packaging products is typically strongest during the summer months and in the period prior to the holidays in December because of the seasonal nature of the consumption of beer and other beverages. Unseasonably cool weather during the summer months can reduce demand for certain beverages packaged in our glass packaging. Similarly, weather conditions can reduce crop yields and adversely affect customer demand for glass packaging for fruit and vegetable end-use categories which could have a material adverse effect on our business, financial condition and results of operations.
We generally schedule shutdowns of our furnaces for rebuilding and repairs of machinery in the first quarter in Europe and around year‑end and the first quarter in North America. If demand for glass packaging should unexpectedly rise during such a shutdown, we would not have the ability to fulfill such demand and may lose potential revenues. These shutdowns and seasonal sales patterns could have a material adverse effect on profitability during the first quarter.
Our profitability could be affected by the availability and cost of raw materials including as a result of changes in tariffs and duties.
The raw materials that we use have historically been available in adequate supply from multiple sources. For certain raw materials, however, there may be temporary shortages due to weather, transportation, production delays or other factors. In such an event, no assurance can be given that we would be able to secure our raw materials from sources other than our current suppliers on terms as favorable as our current terms, or at all. Any such shortages, as well as material increases in the cost of any of the principal raw materials that we use, including the introduction of tariffs, such as the introduction of 25% on steel and 10% on aluminum in the United States in 2018, which remain in effect. Further tariffs,
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duties or other increases in the cost to transport materials to our production facilities, could have a material adverse effect on our business, financial condition and results of operations. Furthermore, the relative price of oil and its by-products may impact our business, by affecting transport, lacquer and ink costs.
The primary raw materials that we use for Metal Beverage Packaging are aluminum ingot and steel. Aluminum ingot is traded daily as a commodity on the London Metal Exchange, which has historically been subject to significant price volatility. Because aluminum is priced in U.S. dollar, fluctuations in the U.S. dollar/euro rate also affect the euro cost of aluminum ingot. Our business is exposed to both the availability of aluminum and the volatility of aluminum prices, including associated premia. While raw materials are generally available from independent suppliers, raw materials are subject to fluctuations in price and availability attributable to a number of factors, including general economic conditions, commodity price fluctuations (with respect to aluminum on the London Metal Exchange), the demand by other industries for the same raw materials and the availability of complementary and substitute materials. Adverse economic or financial changes could impact our suppliers, thereby causing supply shortages or increasing costs for our business.
We may not be able to pass on all or substantially all raw material price increases, now or in the future. In addition, we may not be able to hedge successfully against raw material cost increases. Furthermore, aluminum and steel prices are subject to considerable volatility in price and demand. While in the past sufficient quantities of aluminum and steel have been generally available for purchase, these quantities may not be available in the future, and, even if available, we may not be able to continue to purchase them at current prices. Further increases in the cost of these raw materials could adversely affect our operating margins and cash flows.
The supplier industries from which Metal Beverage Packaging receives its raw materials are relatively concentrated, and this concentration can impact raw material costs. Over the last ten years, the number of major aluminum and steel suppliers has decreased and there remains the possibility of further consolidation. Further consolidation could hinder our ability to obtain adequate supplies of these raw materials and could lead to higher prices for aluminum and steel.
Glass Packaging also consumes significant amounts of raw materials in the manufacturing process, in particular, glass sand, limestone and soda ash (natural or synthetic). Crushed recycled glass (“cullet”) is also a key raw material that is used in varying percentages, depending on the type of glass manufactured and the availability of cullet in a particular market. The combination of higher energy prices and a tight supply market has resulted in a historic increase in price for soda ash. Further increases in demand without corresponding increase in supply may put pressure not only on soda ash, but also on some other raw materials. The price, quality and availability of cullet varies widely from one region to another and is dependent on a number of factors, including glass collection and its effectiveness and the distance of our production sites to population centers where the waste glass is generated. Changes in regulations related to glass collection and recycling, including, for example, the introduction of deposit recycling schemes (“DRS”) such as proposed in Scotland, could have a significant impact on the availability of cullet and on its price. Any significant increase in the price of the raw materials we use to manufacture glass could have a material negative impact on our business, financial condition and results of operations.
The failure to obtain adequate supplies of raw materials or future price increases could have a material adverse effect on our business, financial condition and results of operations.
Currency, interest rate fluctuations and commodity prices may have a material impact on our business.
The Company’s functional currency is the euro and we present our financial information in U.S. dollar. Insofar as possible, we actively manage currency exposures through the deployment of assets and liabilities throughout the Group and, when necessary and economically justified, enter into currency hedging arrangements to manage our exposure to foreign currency fluctuations by hedging against rate changes with respect to our functional currency, the euro. However, we may not be successful in limiting such exposure, which could adversely affect our business, financial condition and results of operations. In addition, our presented results may be impacted as a result of fluctuations in the U.S. dollar exchange rate versus the euro.
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Metal Beverage Packaging has production facilities in 9 different countries worldwide. It also sells products to, and obtains raw materials from, companies located in these and different regions and countries globally. As a consequence, a significant portion of consolidated revenue, costs, assets and liabilities of Metal Beverage Packaging are denominated in currencies other than the euro, particularly the U.S. dollar, the British pound and Brazilian real. The exchange rates between the currencies which we are exposed to, such as the euro, the U.S. dollar, the British pound and the Brazilian real, have fluctuated significantly in the past and may continue to do so in the future.
Metal Beverage Packaging incurs currency transaction risks primarily on metal purchases (or the hedging of those purchases), as metal prices are denominated in U.S. dollars, and on revenue denominated in currencies other than the euro fulfilled from euro‑participant territories (or the hedging of those sales).
A substantial portion of the assets, liabilities, revenues and expenses of Glass Packaging is denominated in U.S. dollars, British pounds, Swedish krona, Danish krone and Polish zloty. Fluctuations in the value of these currencies with respect to the euro have had, and may continue to have, a significant impact on our financial condition and results of operations. For the year ended December 31, 2019, 72% of our continuing operations revenues were from countries with currencies other than the euro.
In addition to currency translation risk, we are subject to currency transaction risk. Our policy is, where practical, to match net investments in foreign currencies with borrowings in the same currency. The debt and interest payments relating to our Swedish, Danish and Polish operations are all denominated in euro. Fluctuations in the value of these currencies with respect to the euro may have a significant impact on our financial condition and results of operations.
Changes in exchange rates can affect our ability to purchase raw materials and sell products at profitable prices, reduce the value of our assets and revenues, and increase liabilities and costs.
We are also exposed to interest rate risk. Fluctuations in interest rates may affect our interest expense on existing debt and the cost of new financing. We occasionally use CCIRS to manage this risk, but sustained increases in interest rates could nevertheless materially adversely affect our business, financial condition and results of operations.
In addition, we are exposed to movements in the price of natural gas. We try to ensure that natural gas prices are fixed for future periods but do not always do so because the future prices can be far in excess of the spot price. We do not use commodity futures contracts to limit the fluctuations in prices paid and the potential volatility in earnings and cash flows from future market price movements.
For a further discussion of these matters and the measures we have taken to seek to protect our business against these risks, see “Item 5. Operating and Financial Review and Prospects” and “Item 11. Quantitative and Qualitative Disclosures About Market Risk”.
It is difficult to compare our results of operations from period to period.
It is difficult to make period‑to‑period comparisons of our results of operations. Our business has been created as a result of a series of acquisitions and other corporate transactions over many years. These acquisitions have had a positive effect on our results of operations in periods following their completion and integration. Furthermore, our sales and, therefore, our net operating income are variable within the fiscal year due to the seasonality described above. Thus, a period‑to‑period comparison of our results of operations may not be meaningful.
Interrupted energy supplies and higher energy costs may have a material adverse effect on our business.
We use natural gas, electrical power, oil, oxygen and, in limited circumstances, liquefied petroleum gas to manufacture our products. These energy sources are vital to our operations and we rely on a continuous power supply to conduct our business. Energy prices are subject to considerable volatility. We are not able to predict to what extent energy
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prices will vary in the future. If energy costs increase further in the future, we could experience a significant increase in operating costs, which could, if we are not able to recover these costs increases from our customers through selling price increases, have a material adverse effect on our business, financial condition and results of operations.
Our ability to fully pass-through input costs may have an adverse effect on our financial condition and results of operations.
A significant number of our sales contracts with customers include provisions enabling us to pass-through increases in certain input costs, which help us deliver consistent margins. However, there is no assurance that the Company will be in a position to fully recover increased input costs from all of our customers, as had been the case in recent years with respect to the elevated freight and logistics costs incurred in our Metal Beverage Packaging and Glass Packaging businesses in North America.
Our manufacturing facilities are subject to operating hazards.
Our manufacturing processes include cutting, coating and shaping metal into containers, as well as heating raw materials to extremely high temperatures to make glass, which we then form into glass containers. These processes, which are conducted at high speeds and involve operating heavy machinery and equipment, entail risks and hazards, including industrial accidents, leaks and ruptures, explosions, fires, mechanical failures and environmental hazards, such as spills, storage tank leaks, discharges or releases of hot glass or toxic or hazardous substances and gases. These hazards may cause unplanned business interruptions, unscheduled downtime, transportation interruptions, personal injury and loss of life, severe damage to or the destruction of property and equipment, environmental contamination and other environmental damage, civil, criminal and administrative sanctions and liabilities, and third‑party claims, any of which may have a material adverse effect on our business, financial condition and results of operations.
We are involved in a continuous manufacturing process with a high degree of fixed costs. Any interruption in the operations of our manufacturing facilities may adversely affect our business, financial condition and results of operations.
All of our manufacturing activities take place at facilities that we own or that are leased by the Group. We conduct regular maintenance on all of our operating equipment. However, due to the extreme operating conditions inherent in some of our manufacturing processes, we cannot assure you that we will not incur unplanned business interruptions due to furnace breakdowns or similar manufacturing problems or that such interruptions will not have an adverse impact on our business, financial condition and results of operations. There can be no assurance that alternative production capacity would be available in the future if a major disruption were to occur or, if it were available, that it could be obtained on favorable terms. A disruption in such circumstances could have a material adverse effect on our business, financial condition and results of operations.
To the extent that we experience any furnace breakdowns or similar manufacturing problems, we will be required to make capital expenditures even though we may not have available resources at such time and we may not be able to meet customer demand, which would result in a loss of revenues. As a result, our liquidity may be impaired as a result of such expenditures and loss of revenues.
A mechanical failure or disruption affecting any major operating line may result in a disruption of our ability to supply customers, and standby capacity may not be available. The potential impact of any disruption would depend on the nature and extent of the damage caused to such facility. Further, our facilities in geographically vulnerable areas, including parts of the United States and Italy, may be disrupted by the occurrence of natural phenomena, such as earthquakes, hurricanes, floods, wildfires and tsunamis.
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Our Glass Packaging business requires relatively high levels of capital expenditures, which we may be unable to fund.
Our Glass Packaging business requires relatively high levels of maintenance capital expenditures. We may not be able to make such capital expenditures if we do not generate sufficient cash flow from operations, have funds available for borrowing under our existing credit facilities to cover these capital expenditure requirements or if we were restricted from incurring additional debt to cover such expenditures or as a result of a combination of these factors. If we are unable to meet our capital expenditure plans, we may not be able to maintain our manufacturing capacity, which may negatively impact our competitive position and ultimately, our revenues and profitability. If we are unable to meet our maintenance capital expenditures, our manufacturing capacity may decrease, which may have a material adverse effect on our profitability.
Our expansion strategy may adversely affect our business.
We aim over the longer term to continue to expand our packaging activities. Such future expansion may require us to capitalize on strategic opportunities including the further acquisition of existing businesses. As we believe that such businesses may be acquired with modest equity and relatively high levels of financial leverage given the cash‑generating capabilities of our business streams, our leverage may increase in the future in connection with any acquisitions. This could have an adverse effect on our business, financial condition and results of operations. In addition, any future expansion is subject to various risks and uncertainties, including the inability to integrate effectively the operations, personnel or products of acquired companies and the potential disruption of existing businesses and diversion of management’s attention from our existing businesses. Furthermore, there can be no assurance that any future expansions will achieve positive results.
We may not be able to integrate any future acquisitions effectively.
Even though we have acquired businesses in the past, there is no certainty that any businesses we may acquire in the future will be effectively integrated. If we cannot successfully integrate acquired businesses within a reasonable time frame, we may not be able to realize the potential benefits anticipated from those acquisitions. Our failure to successfully integrate such businesses and the diversion of management attention and other resources from our existing operations could have a material adverse effect on our business, financial condition and results of operations.
Furthermore, even if we are able to integrate successfully the operations of acquired businesses, we may not be able to realize the cost savings, synergies and revenue enhancements that we anticipate either in the amount or within the time frame that we anticipate, and the costs of achieving these benefits may be higher than, and the timing may differ from, what we expect. Our ability to realize anticipated cost savings and synergies may be affected by a number of factors, including the following:
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the use of more cash or other financial resources on integration and implementation activities than we expect, including restructuring and other exit costs; and |
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increases in other expenses related to acquisitions, which may offset the cost savings and other synergies from such acquisitions. |
Our investment in Trivium is accounted as a joint venture using the equity method which may result in the Group’s accounting carrying value of its investment reducing should Trivium incur post-tax losses.
The Group holds approximately 42% of the ordinary shares of Trivium. As the Group jointly controls both the financial and operating policy decisions of Trivium, the investment is accounted for as a joint venture under the equity method. The Group’s carrying amount of its interest under the equity method, which at December 31, 2019 totaled $0.4 billion, will change as a result of the requirements of the equity method. The equity method results in the Group accounting for its share of the post-tax profit or loss and share of the other comprehensive income of Trivium. As Trivium has a
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substantial amount of debt and significant debt service obligations and may incur post tax and other comprehensive losses, the Group’s accounting carrying value of its interest may reduce as a result of the requirements of equity accounting.
We have potential indemnification obligations relating to divestments.
We have previously divested a number of businesses, including, in 2019, the divestment of Food & Specialty Metal Packaging. Pursuant to these agreements, we may be required to provide indemnification to the acquirers for damages resulting from a breach of any representation, warranty or covenants contained therein. To the extent that we are required to make any significant payments under these indemnification provisions, these payments could adversely impact our business, financial condition and results of operations.
We are subject to various environmental and other legal requirements and may be subject to new requirements of this kind in the future that could impose substantial costs upon us.
Our operations and properties are subject to extensive laws, ordinances, regulations and other legal requirements relating to environmental protection. Such laws and regulations which may affect our operations include, among others, requirements regarding remediation of contaminated soil, groundwater and buildings, water supply and use, natural resources, water discharges, air emissions, waste management, noise pollution, asbestos and other deleterious materials, the generation, storage, handling, transportation and disposal of regulated materials, product safety, and workplace health and safety. Such laws and regulations are also subject to constant review by lawmakers and regulators which may result in further environmental legal requirements.
We have incurred, and expect to continue to incur, costs to comply with such legal requirements, and these costs may increase in the future. Demands for more stringent pollution control devices could also result in the need for further capital upgrades to our furnaces and plant operations. We require a variety of permits to conduct our operations, including operating permits such as those required under various U.S. laws, including the federal Clean Air Act, and the EU Industrial Emissions Directive water and trade effluent discharge permits, water abstraction permits and waste permits. We are in the process of applying for, or renewing, permits at a number of our sites. Failure to obtain and maintain the relevant permits, as well as noncompliance with such permits, could have a material adverse effect on our business, financial condition and results of operations.
If we were to violate or fail to comply with these laws and regulations or our permits, we could be subject to criminal, civil and administrative sanctions and liabilities, including substantial fines and orders, or a partial or total shutdown of our operations. For example, in 2017 we settled alleged violations of hazardous waste regulations governing the reuse of electrostatic precipitator dust at our Madera plant in the United States, which occurred in the period prior to the acquisition in 2014 of VNA. As part of this settlement, we paid a civil penalty of $3.5 million and expect to incur increased dust disposal costs, which we estimate to be about $500,000 annually. We cannot assure you that our reuse of electrostatic precipitator dust at our other glass manufacturing plants will not result in regulatory inquiries or enforcement relating to compliance with hazardous waste regulations.
In order to comply with air emission restrictions, significant capital investments may be necessary at some sites. For example, to comply with U.S. environmental regulations and the demands of the EPA, VNA, which we acquired in 2014, we agreed to make sizable investments to replace or install new electrostatic precipitators and other equipment in order to control the air emissions at certain sites located in the United States. In 2010, prior to the 2014 acquisition of VNA by Ardagh, VNA and the EPA signed a global consent decree pursuant to which VNA has made investments estimated at up to an aggregate of $112 million over a ten‑year period, excluding operating costs of the systems installed. In addition, we paid a penalty amounting to $2.5 million, excluding interest, pursuant to this consent decree.
We have received notices of violation from the EPA for alleged violations under the Clean Air Act’s Prevention of Significant Deterioration, New Source Performance Standards and Title V provisions stemming from past furnace‑related projects at our other glass manufacturing facilities unrelated to our acquisition of VNA, including furnace‑related projects conducted by third parties who owned the facilities before us. The EPA has sent information
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requests to a number of our glass manufacturing facilities concerning furnace‑related projects, as well as our air pollutant emissions more generally, which could culminate in notices of violation or other enforcement.
In Europe, under the IED and its reference document for “Best Available Techniques” for glass manufacturing plants and metal manufacturing plants with surface treatment using solvents, permitted emissions levels from these plants including ours are reduced substantially periodically. In Germany, technical guidelines, TA Luft, set forth emission thresholds which could potentially result in stricter limits in the future. These types of changes could require additional investment in our affected operations. Our business is also affected by the EU Emission Trading Scheme, which limits emissions of greenhouse gases. See “Item 4 Information on the Company—Environmental, Health and Safety and Product Safety Regulation”. This scheme, any future changes to it and any additional measures required to control the emission of greenhouse gases that may apply to our operations could have a material adverse effect on our business, financial condition and results of operations. California has implemented a similar program, which results in the need for us to incur potentially significant compliance costs, including for the purchase of offsets against our greenhouse gas emissions. There are also some municipalities exploring further regulation to reduce or in some cases eliminate natural gas usage.
Changes to the laws and regulations governing the materials that are used in our manufacturing operations may impact the price of such materials or result in such materials no longer being available, which could have a material adverse effect on our business, financial condition and results of operations. The European Union passed regulations concerning REACH, which place onerous obligations on the manufacturers and importers of substances, preparations and articles containing substances, and which may have a material adverse effect on our business. Furthermore, substances we use may have to be removed from the market (under REACH’s authorization and restriction provisions) or need to be substituted for alternative chemicals which may also adversely impact upon our operations.
Sites at which we operate often have a long history of industrial activities and may be, or have been in the past, engaged in activities involving the use of materials and processes that could give rise to contamination and result in potential liability to investigate or remediate, as well as claims for alleged damage to persons, property or natural resources. Liability may be imposed on us as owners, occupiers or operators of contaminated facilities. These legal requirements may apply to contamination at sites that we currently or formerly owned, occupied or operated, or that were formerly, owned, occupied or operated by companies we acquired or at sites where we have sent waste offsite for treatment or disposal. Regarding assets acquired by us, including the beverage can manufacturing assets, we cannot assure you that our due diligence investigations identified or accurately quantified all material environmental matters related to the acquired facilities. Our closure of a site may accelerate the need to investigate and remediate any contamination at the site.
In addition, we may be required to remediate contaminated third‑party sites where we have sent waste for disposal. Liability for remediation of these third‑party sites may be established without regard to whether the party disposing of the waste was at fault or the disposal activity was legal at the time it was conducted. For example, “Superfund” sites in the United States are the highest priority contaminated sites designated by the federal government as requiring remediation, and costs of their remediation tend to be high. We and a number of other companies have been named as potentially responsible parties to clean up the Lower Duwamish Waterway Superfund Site in Washington, because our Seattle plant is adjacent to the waterway and is alleged to have contributed to its contamination. Whether we will have any liability for investigation and remediation costs at this or any other Superfund site or for costs relating to claims for natural resource damages, and what portion of the costs we must bear, has not been determined.
Changes in product requirements and their enforcement may have a material impact on our operations.
Changes in laws and regulations relating to deposits on, and any limits or restrictions to recycling of, glass or metal packaging could adversely affect our business if implemented on a large scale in the major markets in which we operate. Changes in laws and regulations laying down restrictions on, and conditions for use of, food contact materials or on the use of materials and agents in the production of our products could likewise adversely affect our business. Changes to health and food safety regulations could increase costs and also might have a material adverse effect on revenues if, as a result, the public attitude toward end‑products, for which we provide packaging, were substantially affected.
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Additionally, the effectiveness of new standards such as the ones related to recycling or deposits on different packaging materials could result in excess costs or logistical constraints for some of our customers who could choose to reduce their consumption and terminate the use of glass or metal packaging for their products. We could thus be forced to reduce, suspend or even stop the production of certain types of products. The regulatory changes could also affect our prices, margins, investments and activities, particularly if these changes resulted in significant or structural changes in the market for food packaging that might affect the market shares for glass, the volumes produced or production costs.
Environmental concerns could lead U.S. or European Union bodies to implement other product regulations that are likely to be restrictive for us and have a material negative impact on our business, financial condition and results of operations. For example, in the European Union, each bottle cannot, in principle, contain more than the applicable heavy metals limit pursuant to Directive 94/62/CE on Packaging and Packaging Waste. There is significant variation, among countries where we sell our products, in the limitation on certain constituents in packaging, which can have the effect of restricting the types of raw materials or amount of recycled glass we use. In turn, these restrictions can increase our operating costs, such as increased energy consumption, and the environmental impacts of our operations.
Similarly, in the United States, some state regulations set the concentration of certain heavy metals in packaging at 100 ppm and provide for an exception to this rule in the event of additions of recycled packaging. Because this exemption has expired in certain states, the bottles manufactured from recycled glass that have a heavy metals concentration higher than 100 ppm could be noncompliant, which could have a negative impact on our earnings, financial condition, assets or image. We have had regulatory inquiries about our compliance and may in the future have additional inquiries or enforcement.
Other changes, such as restrictions on bisphenol A in coatings for some of our products or potential legislation on the industry’s use of non-food or beverage contact perfluoroalkyl and polyfluoroalkyl substance chemicals, have required us to develop substitute materials for our production.
We could incur significant costs in relation to claims of injury and illness resulting from materials present or used at our production sites, or from our use of these sites or other workplace injuries, or from our products.
As is the case in a number of other industrial processes that deal with high temperatures, asbestos was once present in the glass‑making industry, primarily in safety equipment, until measures were taken to substitute this material for other materials made possible through technological advances. Since the 1990s, items made of asbestos have gradually been removed at our sites in Western Europe and the United States. Because of the age of some of our sites, however, asbestos‑cement may have been used in construction and may still be present at these sites. When these buildings are modernized or repaired, the cost of upgrades is higher because of the restrictions associated with removing asbestos‑containing materials.
We are exposed to claims alleging injury or illness associated with asbestos and related compensation over and above the support that may be offered through various existing social security systems in countries where we operate.
Claims associated with our glass manufacturing operations exist and may arise for reasons associated with the work environment unrelated to the presence of asbestos. For example, claims have arisen associated with the acoustic environment generated by forming machines, the use of glass sand in making glass and products likely to contain heavy metals or solvents for decoration. We may also face the risk of work‑related health claims owing to materials present or used at our production sites such as silicosis, and, under certain conditions, Legionnaires’ disease. The U.S. Occupational Safety and Health Administration has implemented a requirement that reduced by 50% the permissible exposure limit to crystalline silica and requires engineering controls or personal protective equipment to safeguard employees from such exposure. The European Union has also set stricter exposure limit values for respirable crystalline silica in work processes under the Carcinogens and Mutagens Directive. This substance is a common mineral found in sand, which is a significant raw material component for glass manufacturing and is also contained in refractories, or bricks, used in glass manufacturing operations. Our costs to meet these reduced limits could be substantial, particularly if it becomes necessary for us to implement broad engineering controls across many of our glass manufacturing plants.
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We are also exposed to claims alleging musculoskeletal disorders caused by performing certain repetitive operations or motions. We could also face claims alleging illness or injury from use of the products that we manufacture or sell or from workplace injuries more generally. If these claims succeed, they could have a material adverse impact on our business, financial condition and results of operations.
We may be subject to litigation, regulatory investigations, arbitration and other proceedings that could have an adverse effect on us.
We are currently involved in various litigation matters, and we anticipate that we will be involved in litigation matters from time to time in the future. The risks inherent in our business expose us to litigation, including personal injury, environmental litigation, contractual litigation with customers and suppliers, intellectual property litigation, tax or securities litigation, and product liability lawsuits. We cannot predict with certainty the outcome or effect of any claim, regulatory investigation, or other litigation matter, or a combination of these. If we are involved in any future litigation, or if our positions concerning current disputes are found to be incorrect, this may have an adverse effect on our business, financial condition and results of operations, because of potential negative outcomes, the costs associated with asserting our claims or defending such lawsuits, and the diversion of management’s attention to these matters. See Note 28 to the consolidated financial statements.
We could incur significant costs due to the location of some of our industrial sites in urban areas.
Obtaining, renewing or maintaining permits and authorizations issued by administrative authorities necessary to operate our production plants could be made more difficult due to the increasing urbanization of the sites where some of our manufacturing plants are located. Some of our sites are located in urban areas. Urbanization could lead to more stringent operating conditions (by imposing traffic restrictions for example), conditions for obtaining or renewing the necessary authorizations, the refusal to grant or renew these authorizations, or expropriations of these sites in order to allow urban planning projects to proceed.
The occurrence of such events could result in us incurring significant costs and there can be no assurance that the occurrence of such events would entitle us to partial or full compensation.
Changes in consumer lifestyle, nutritional preferences, health‑related concerns and consumer taxation could adversely affect our business.
Changes in consumer preferences and tastes can have an impact on demand for our customers’ products, which in turn can lead to reduced demand for our products. In the United States, for example, the growth in consumption of imported beer and in newer beverage categories such as hard seltzers, has seen reduced demand for domestically-produced mass beer brands, resulting in reduced demand for glass packaging for this end-use category.
Certain end‑products represent a significant proportion of our packaging market. Additionally, France and the United Kingdom have introduced taxes on drinks with added sugar and artificial sweeteners that companies produce or import. France has also imposed taxes on energy drinks using certain amounts of taurine and caffeine. As a result of such taxes, demand decreased temporarily, and the imposition of such taxes in the future may lower the demand for certain soft drinks and beverages that our customers produce, which may cause our customers to respond by reducing their purchases of our metal and glass packaging products. Consumer tax legislation and future attempts to tax sugar or energy drinks or to lower consumption of certain alcoholic and non-alcoholic categories by other jurisdictions could reduce the demand for our products and adversely affect our profitability.
Any decline in the popularity of these product types as a result of lifestyle, nutrition, health considerations or consumer taxation could have a significant impact on our customers and could have a material adverse impact on our business, financial condition and results of operations.
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We face costs associated with our post‑retirement and post‑employment obligations to employees which could have an adverse effect on our financial condition.
As of December 31, 2019, our accumulated post‑retirement benefit obligation was approximately $716 million. The additional costs associated with these and other benefits to employees could have a material adverse effect on our financial condition.
We operate a number of pension and other post‑retirement benefit schemes funded by a range of assets which may include property, derivatives, equities and/or bonds. The value of these assets is heavily dependent on the performance of markets which are subject to volatility. The liability structure of the obligations to provide such benefits is also subject to market volatility in relation to its accounting valuation and management. Additional significant funding of our pension and other post‑retirement benefit obligations may be required if market underperformance is severe.
Organized strikes or work stoppages by unionized employees could have a material adverse effect on our business.
Many of our operating companies are party to collective bargaining agreements with trade unions. These agreements cover the majority of our employees. Upon the expiration of any collective bargaining agreement, our operating companies’ inability to negotiate acceptable contracts with trade unions could result in strikes by the affected workers and increased operating costs as a result of higher wages or benefits paid to union members. If the unionized workers were to engage in a strike or other work stoppage, we could experience a significant disruption of operations and/or higher ongoing labor costs, which may have a material adverse effect on our business, financial condition and results of operations.
Failure of control measures and systems resulting in faulty or contaminated product could have a material adverse effect on our business.
We have strict control measures and systems in place to ensure that the maximum safety and quality of our products is maintained. The consequences of a product not meeting these rigorous standards, due to, among other things, accidental or malicious raw materials contamination or due to supply chain contamination caused by human error or equipment fault, could be severe. Such consequences might include adverse effects on consumer health, litigation exposures, loss of market share, financial costs and loss of revenues.
In addition, if our products fail to meet rigorous standards, we may be required to incur substantial costs in taking appropriate corrective action (up to and including recalling products from consumers) and to reimburse customers and/or end‑consumers for losses that they suffer as a result of this failure. Customers and end‑consumers may seek to recover these losses through litigation and, under applicable legal rules, may succeed in any such claim, despite there being no negligence or other fault on our part. Placing an unsafe product on the market, failing to notify the regulatory authorities of a safety issue, failing to take appropriate corrective action and failing to meet other regulatory requirements relating to product safety could lead to regulatory investigation, enforcement action and/or prosecution. Any product quality or safety issue may also result in adverse publicity, which may damage our reputation. This could in turn have a material adverse effect on our business, financial condition and results of operations. Although we have not had material claims for damages for defective products in the past, and have not conducted any substantial product recalls or other material corrective action, these events may occur in the future.
In certain contracts, we provide warranties in respect of the proper functioning of our products and the conformity of a product to the specific use defined by the customer.
In addition, if a product contained in packaging manufactured by us is faulty or contaminated, it is possible that the manufacturer of the product may allege that our packaging is the cause of the fault or contamination, even if the packaging complies with contractual specifications. Furthermore, in certain countries, certain participants in the distribution chain refill bottles, even though they may not be designed for this purpose.
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In case of the failure of packaging produced by us to open properly or to preserve the integrity of its contents, we could face liability to our customers and to third parties for bodily injury or other tangible or intangible damages suffered as a result. Such liability, if it were to be established in relation to a sufficient volume of claims or to claims for sufficiently large amounts, could have a material adverse effect on our business, financial condition and results of operations.
Our existing insurance coverage may be insufficient and future coverage may be difficult or expensive to obtain.
Although we believe that our insurance policies provide adequate coverage for the risks inherent in our business, these insurance policies typically exclude certain risks and are subject to certain thresholds and limits. We cannot assure you that our property, plant and equipment and inventories will not suffer damages due to unforeseen events or that the proceeds available from our insurance policies will be sufficient to protect us from all possible loss or damage resulting from such events. As a result, our insurance coverage may prove to be inadequate for events that may cause significant disruption to our operations, which may have a material adverse effect on our business, financial condition and results of operations.
We may suffer indirect losses, such as the disruption of our business or third‑party claims of damages, as a result of an insured risk event. While we carry business interruption insurance and general liability insurance, they are subject to certain limitations, thresholds and limits, and may not fully cover all indirect losses.
We renew our insurance policies on an annual basis. The cost of coverage may increase to an extent that we may choose to reduce our policy limits or agree to certain exclusions from our coverage. Among other factors, adverse political developments, security concerns and natural disasters in any country in which we operate may materially adversely affect available insurance coverage and result in increased premiums for available coverage and additional exclusions from coverage.
Our business may suffer if we do not retain our executive and senior management.
We depend on our executive team, who are identified under “Item 6—Directors, Senior Management and Employees” of this annual report. The loss of services of any of the members of our executive team, members of senior management or other key personnel could adversely affect our business until a suitable replacement can be found. There may be a limited number of persons with the requisite skills to serve in these positions and there is no assurance that we would be able to locate or employ such qualified personnel on terms acceptable to us or at all.
The United Kingdom’s withdrawal from the European Union may have a negative effect on our financial condition and results of operations.
Approximately 12% of our total 2019 continuing operations revenue has been derived from revenues generated in the United Kingdom and 7 of our 56 Metal Beverage or Glass Packaging manufacturing facilities are located in the United Kingdom.
On March 29, 2017, the United Kingdom gave notice to the European Union under Article 50 of the Treaty of European Union of its decision to withdraw from the European Union (‘‘Brexit’’). The withdrawal of the United Kingdom from the European Union occured on January 31, 2020.
Following Brexit on January 31, 2020, the United Kingdom left the European Union and entered into a transition period set to expire on December 31, 2020. Following the end of the transition period, there may be changes in the legal rights and obligations among commercial parties in the United Kingdom and the European Union, including (among others) financial institutions, suppliers and service providers and their respective customers. Any changes to the trading relationship between the United Kingdom and the European Union may adversely affect the cost or timing of imports, including aluminum and coatings in our Metal Beverage Packaging operations and molds and machinery in our Glass Packaging operations.
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While we predominantly sell to customers in the local U.K. market, some of our customers based in the U.K. who export outside the local U.K. market, may experience reduced demand and/or delays arising from Brexit and post-Brexit arrangements. These negative impacts could adversely affect our financial condition and results of operations. Additionally, because of the extent of our business in the United Kingdom, the precise impact of Brexit is difficult to predict and may include effects beyond those described herein, which could have a material adverse impact on our financial condition and results of operations.
Brexit may also have an adverse impact on our business, employees and customers in the United Kingdom. In addition, changes in laws and regulations after the end of the transition period, including import, tax and employment laws and regulations, could adversely impact the results of operations of our U.K. business. For example, a portion of our U.K. employees are likely to be citizens of other European countries and there is a risk that Brexit will adversely affect our and our contractors’ and suppliers’ ability to retain and recruit employees from this wider European labor market, which may lead to labor shortages and higher costs.
Further, political instability as a result of Brexit may result in a material negative effect on credit markets and foreign direct investments in Europe and the United Kingdom. For example, the announcement of the Brexit vote caused significant volatility in global stock markets and currency exchange rate fluctuations that resulted in the weakening of the exchange rate of the British pound. Uncertainty concerning the terms of Brexit during and following the transition period could cause further volatility in the British pound against other currencies, and thus increase our foreign exchange risk. See also our risk factor entitled “Currency, interest rate fluctuations and commodity prices may have a material impact on our business.” This deterioration in economic conditions could result in increased unemployment rates, increased short- and long-term interest rates, consumer and commercial bankruptcy filings, a decline in the strength of national and local economies, and other results that negatively impact household incomes.
The economic outlook could be further adversely affected by the risk that one or more European Union member states could leave the European Union as well, the risk of a greater push for independence by Scotland or Northern Ireland, or the risk that the euro as the single currency of any or all of the Eurozone member states could cease to exist. These developments, or the perception that any of them could occur, may have a material adverse effect on the stability of global financial markets, and could significantly reduce global market liquidity and restrict the ability of key market participants to operate in certain financial markets. Asset valuations, currency exchange rates and credit ratings may be especially subject to increased market volatility. These negative impacts could adversely affect our financial condition and results of operations
Increasing privacy and data security obligations or a significant data breach may adversely affect the Company’s business.
The Company will continue its efforts to meet data security obligations and must manage evolving cybersecurity threats. The loss, disclosure, misappropriation of or access to employees’ or business partners’ information or the Company’s failure to meet its obligations could result in lost revenue, increased costs, legal claims or proceedings, liability or regulatory penalties. A significant data breach or the Company’s failure to meet its obligations may adversely affect the Company’s reputation and financial condition.
The Company’s heavy reliance on technology and automated systems to operate its business could mean any significant failure or disruption of the technology or these systems could materially harm its business.
The Company depends on automated systems and technology to operate its business, including accounting systems, manufacturing systems and telecommunication systems. The Company operates a cyber and information risk management program including operating a global information security function which partners with global leaders in the security industry to deliver an integrated information and cyber risk management service using state-of-the-art technologies in areas including antivirus & anti-malware, email and web security platforms, firewalls, intrusion detection systems, cyber threat intelligence services and advanced persistent threat detection. The Company also partners with global leaders to deliver high availability and resilient systems and communication platforms. However, there is the possibility that these
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systems could suffer substantial or repeated disruptions due to various events, some of which are beyond the Company’s control, including natural disasters, power failures, terrorist attacks, equipment or software failures, computer viruses or cyber security attacks. Substantial or repeated systems failures or disruptions, could result in the unauthorized release of confidential or otherwise protected information, result in increased costs, lost revenue and the loss or compromise of important data, and may adversely affect the Company’s business, results of operations and financial condition.
Our substantial debt could adversely affect our financial health and prevent us from fulfilling our obligations under the Notes.
We have a substantial amount of debt and significant debt service obligations. As of December 31, 2019, we had total borrowings and net debt of $5.9 billion and $5.3 billion, respectively. For more information, see the description of our debt facilities and the table outlining our principal financing arrangements in “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources”.
Our substantial debt could have negative consequences for us and for our shareholders. For example, our substantial debt could:
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require us to dedicate a large portion of our cash flow from operations to service debt and fund repayments on our debt, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate purposes; |
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increase our vulnerability to adverse general economic or industry conditions; |
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limit our flexibility in planning for, or reacting to, changes in our business or the industry in which we operate; |
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limit our ability to raise additional debt or equity capital in the future; |
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restrict us from making strategic acquisitions or exploiting business opportunities; |
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make it difficult for us to satisfy our obligations with respect to our debt; and |
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place us at a competitive disadvantage compared to our competitors that have less debt. |
In addition, a portion of our debt bears interest at variable rates that are linked to changing market interest rates. Although we may hedge a portion of our exposure to variable interest rates by entering into interest rate swaps, we cannot assure you that we will do so in the future. As a result, an increase in market interest rates would increase our interest expense and our debt service obligations, which would exacerbate the risks associated with our leveraged capital structure.
Negative developments in our business, results of operations and financial condition due to changes in global economic conditions or other factors could cause ratings agencies to lower the credit ratings, or ratings outlook, of our short‑ and long‑term debt and, consequently, impair our ability to raise new financing or refinance our current borrowings and increase our costs of issuing any new debt instruments.
Risks Related to Our Class A Common Shares
The dual class structure of our common shares has the effect of concentrating voting control with our Parent Company or its shareholders and limiting our other shareholders’ ability to influence corporate matters.
Our Class B common shares, with a nominal value of €0.10 each, have 10 votes per share, and our Class A common shares, with a nominal value of €0.01 each, have one vote per share. Our Parent Company owns indirectly all Class B common shares, which represent approximately 99.15% of the voting power of our issued and outstanding share capital. Our Parent Company has the ability to control the outcome of most matters requiring shareholder approval, including:
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the election of our board of directors and, through our board of directors, decision making with respect to our business direction and policies, including the appointment and removal of our officers; |
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mergers and de‑mergers; |
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changes to our Articles; and |
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our capital structure. |
This voting control and influence may discourage transactions involving a change of control of the Company, including transactions in which holders of our Class A common shares might otherwise receive a premium for their shares.
In addition, our Parent Company may continue to be able to control the outcome of most matters submitted to our shareholders for approval even if their shareholdings represent less than 50% of all issued shares. Due to the 10‑to‑1 voting ratio between our Class B and Class A common shares, our Parent Company will continue to control a majority of the combined voting power of our issued and outstanding share capital even when Class B common shares represent substantially less than 50% of all issued and outstanding common shares. This concentrated control will limit the ability of holders of our Class A common shares to influence corporate matters for the foreseeable future, and, as a result, the market price of our Class A common shares could be adversely affected.
The Company has agreed with the Parent Company to take such actions as are necessary to implement a reorganization of the Parent Company so that shareholders of the Parent Company become proportionate direct holders of our common shares, provided that the aggregate number of Class B common shares received by such shareholders in such event shall be substantially the same as or fewer than (adjusting for fractional shares) the number of the Class B common shares owned by the Parent Company immediately prior to the date of such event. If such a reorganization were to occur, we anticipate that such holders who are Qualified Holders (as defined under “Item 10. Additional Information—B. Memorandum and articles of association”) will be entitled to elect to receive either Class A common shares or Class B common shares in the reorganization and that following the reorganization, holders of Class B common shares may continue to collectively have voting power that would allow them to control the outcome of most matters requiring shareholder approval. The pre‑IPO shareholders of the Parent Company are also permitted, in our Articles, to transfer Class B common shares among themselves and to certain family members and permitted entities.
Future sales of our Class A common shares in the public market could cause our share price to fall.
Future sales of our Class A common shares, or securities convertible or exchangeable into our Class A common shares, in the public market, whether by us, our existing shareholders, the shareholders of the Parent Company or pledgees of our Class B common shares, future issuances of additional Class A common shares in connection with any future acquisitions or pursuant to any employee benefit plans, future issuances of our Class A common shares upon exercise of options or warrants, or the perception that such sales, issuances and/or exercises could occur, may adversely affect the market price of our Class A common shares, which could decline significantly.
A decline in the price of our Class A common shares might impede our ability to raise capital through the issuance of additional Class A common shares or other equity securities.
To the extent we issue substantial additional Class A common shares, the ownership of our existing shareholders would be diluted and our earnings per share could be reduced, which may negatively affect the market price of our Class A common shares.
In addition, the Toggle Notes issued by the Parent Company are secured by all of our outstanding Class B common shares. Enforcement of the pledges in an event of default under the Toggle Notes could impact corporate control and might trigger change of control provisions under the indentures.
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In the future, we may issue options, restricted shares and other forms of share‑based compensation, which have the potential to dilute shareholder value and cause the price of our Class A common shares to decline.
We may offer share options, restricted shares and other forms of share‑based compensation to our directors, officers and employees in the future. If any options that we issue are exercised, or any restricted shares that we may issue vest, and those shares are sold into the public market, the market price of our Class A common shares may decline. In addition, the availability of Class A common shares for award under any equity incentive plan we may introduce, or the grant of share options, restricted shares or other forms of share‑based compensation, may adversely affect the market price of our Class A common shares.
Judgments obtained in U.S. courts against us may have to be enforced in Luxembourg.
We are incorporated under Luxembourg Law, a substantial portion of our assets are located outside of the United States and many of our directors and officers and certain other persons named in this annual report are, and will continue to be, non‑residents of the United States. As a result, although we have appointed an agent for service of process in the United States, it may be difficult or impossible for U.S. investors to effect service of process within the United States upon us or our directors and officers or to enforce, in a U.S. court, judgments obtained against us including for civil liabilities under the United States federal securities laws. Therefore, any judgments obtained in any U.S. federal or state court against us may have to be enforced in the courts of Luxembourg or other EU member states.
While we currently intend to pay quarterly cash dividends, we are a holding company and depend on dividends and other distributions from subsidiaries in order to do so.
As we are a holding company, our ability to pay cash dividends on our shares may be limited by restrictions on our ability to obtain sufficient funds through dividends from subsidiaries, including restrictions under the terms of the agreements governing the current indebtedness of us and our subsidiaries or future indebtedness that we or our subsidiaries may incur.
Subject to any limitations referred to above, or as prescribed by Luxembourg Law, the declaration of future dividends, if any, will depend upon our future operations and earnings, capital expenditure requirements, general financial conditions, legal and contractual restrictions and other factors. In addition, under the indenture governing the Toggle Notes, the Parent Company is required to cause us to take all actions necessary or appropriate to permit the making of the maximum amount of dividends or other distributions that would be lawfully permitted to be declared and paid in order for it to meet its cash interest payment obligations. In certain circumstances, we may be required to declare a special dividend to the Parent Company in order to comply with these obligations.
The rights and responsibilities of shareholders are governed by Luxembourg Law and will differ in some respects from the rights and responsibilities of shareholders under U.S. law.
Our corporate affairs are governed by our Articles and Luxembourg Law. In the performance of its duties, the board of directors is required to act as a collegiate body in the interest of the Company. It is possible that the Company may have interests that are different from interests of the shareholders. If any member of our board of directors has a direct or indirect financial interest in a matter which has to be considered by the board of directors which conflicts with the interests of the Company, Luxembourg Law provides that such director will not be entitled to participate in deliberations on and exercise his vote with respect to the approval of such transaction. If the interest of such a member of the board of directors does not conflict with the interests of the Company, then the applicable director with such interest may participate in deliberations on, and vote on the approval of, that transaction.
All of our shareholder meetings will take place in Luxembourg. Shareholders may vote by proxy or in person at any general meeting.
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In addition, the rights of our shareholders are governed by Luxembourg Law and our Articles and differ from the rights of shareholders under U.S. law.
Our Articles include compulsory share transfer provisions that may not provide our minority shareholders with the same benefits as they would have in a merger of a Delaware corporation.
We have included in our Articles provisions that give the holder of 75% of the number of our outstanding common shares (which would include the Parent Company for so long as it holds the requisite number of our common shares) the right to acquire our outstanding shares held by all other holders at such time for a purchase price payable in cash that is equal to the fair market value of such shares, as determined by an independent investment banking firm of international reputation in accordance with the procedures contained in our Articles. These procedures include a dispute resolution provision permitting holders of at least 10% of the shares of the Company held by our minority shareholders at that time to dispute the purchase price proposed by the acquiring shareholder. It is uncertain whether our minority shareholders will be able to coordinate with each other in a manner that will enable them to take full advantage of these provisions. There can be no assurance that these provisions would result in a price as favorable to our minority shareholders as they would receive in a transaction subject to Delaware law and appraisal rights.
The super voting rights of our Class B common shares and other anti‑takeover provisions in our Articles might discourage or delay attempts to acquire us.
In addition to the super voting rights of our Class B common shares, our Articles contain provisions that may make the acquisition of our Company more difficult, including the following:
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Control by Class B common shareholders. Our Articles provide for a dual class share structure, which, for so long as Class B common shares are issued and outstanding, will allow our Parent Company to control the outcome of most matters requiring shareholder approval, even if it owns Class B common shares representing significantly less than a majority of the Company’s issued and outstanding common shares. As a result, the holders of our Class B common shares could delay or prevent the approval of a change of control transaction that may otherwise be approved by the holders of the issued and outstanding Class A common shares. |
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Classified Board. Our board of directors is classified into three classes of directors that are, as nearly as possible, of equal size. Each class of directors will be elected for a three‑year term of office, but the terms are staggered so that the term of only one class of directors expires at each annual general meeting. The existence of a classified board could impede a proxy contest or delay a successful tender offeror from obtaining majority control of the board of directors, and the prospect of that delay might deter a potential offeror. |
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Notice Requirements for Shareholder Proposals. Luxembourg Law and our Articles provide that one or more shareholders together holding at least the 10% threshold may request the addition of one or more items to the agenda of any general meeting. The request must be sent to the registered office by registered mail, at least five clear days before the meeting is held. Our Articles also specify certain requirements regarding the form and content of a shareholder’s notice. These requirements may make it difficult for our shareholders to bring matters before a general meeting. |
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Special Resolutions. Our Articles require special resolutions adopted at an extraordinary general meeting for any of the following matters, among other things: (a) an increase or decrease of the authorized or issued capital, (b) an amendment to our Articles and (c) dissolving the Company. Pursuant to our Articles, for any special resolutions to be considered at a general meeting the quorum is at least one‑half (1/2) of the share capital in issue present in person or by proxy, taking into account the par value of each Class A common share (€0.01) and the par value of each Class B common share (€0.10) (in effect one‑half (1/2) of the voting rights), unless otherwise mandatorily required by Luxembourg Law. Any special resolution may be adopted |
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at a general meeting at which a quorum is present (except as otherwise provided by mandatory law) by the affirmative votes of at least two‑thirds (2/3) of the votes validly cast on such resolution by shareholders entitled to vote. |
These anti‑takeover provisions could discourage, delay or prevent a transaction involving a change in control of our Company, even if such transaction would benefit our shareholders.
We qualify for and rely on exemptions from certain corporate governance requirements.
We are exempt from certain corporate governance requirements of the NYSE by virtue of being a “foreign private issuer.” Although our foreign private issuer status exempts us from most of the NYSE’s corporate governance requirements, we intend to voluntarily comply with these requirements, except those from which we would be exempt by virtue of being a “controlled company.” Our Parent Company controls, directly or indirectly, a majority of the voting power of our issued and outstanding shares and is a controlled company within the meaning of the NYSE corporate governance standards, entitled to certain limited corporate governance exemptions. Under these NYSE standards, a company of which more than 50% of the voting power is held by another person or group of persons acting together is a controlled company and may elect not to comply with certain NYSE corporate governance requirements, including the requirements that:
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a majority of the board of directors consist of independent directors; |
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the nominating and governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; |
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the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and |
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there be an annual performance evaluation of the nominating and governance and compensation committees. |
As a controlled company, we utilize these exemptions, including the exemption from the requirement to have a board of directors composed of a majority of independent directors. In addition, although we have adopted charters for our audit, compensation and nominating and governance committees, our compensation and nominating and governance committees are not expected to be composed of independent directors.
As a result of the foregoing exemptions, we can cease voluntary compliance at any time, and our shareholders may not have the same protections afforded to shareholders of companies that are subject to all of the NYSE corporate governance requirements.
If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired.
As a listed company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes‑Oxley Act and the listing standards of the NYSE. The requirements of these rules and regulations may further, increase our legal, accounting, and financial compliance costs and make some activities more difficult, time consuming and costly.
The Sarbanes‑Oxley Act requires, among other things that, as a listed company, our principal executive officer and principal financial officer certify the effectiveness of our disclosure controls and procedures and our internal controls over financial reporting. Any failure to maintain effective controls, or any difficulties encountered in their implementation or improvement, could harm our operating results or cause us to fail to meet our reporting obligations and may result in a restatement of our financial statements for prior periods. Any failure to implement and maintain effective internal control over financial reporting also could adversely affect the results of management evaluations and independent registered
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public accounting firm audits of our internal control over financial reporting. Ineffective disclosure controls and procedures or ineffective internal control over financial reporting could also cause investors to lose confidence in our reported financial information.
Holders generally will be subject to a 15% withholding tax on payment of dividends made on the Class A common shares under current Luxembourg tax law.
Under current Luxembourg tax law, payments of dividends made on the Class A common shares generally are subject to a 15% Luxembourg withholding tax. Certain exemptions or reductions in the withholding tax may apply, but it will be up to the holders to claim any available refunds from the Luxembourg tax authority. For more information on the taxation implications, see, “Item 10. Additional Information—Taxation”.
Our shareholders may have more difficulty protecting their interests than they would as shareholders of a U.S. corporation.
Our corporate affairs are governed by our Articles and Luxembourg Law, including the laws governing joint stock companies. The rights of our shareholders and the responsibilities of our directors and officers under Luxembourg Law are different from those applicable to a corporation incorporated in the United States. There may be less publicly available information about us than is regularly published by or about U.S. issuers. In addition, Luxembourg Law governing the securities of Luxembourg companies may not be as extensive as those in effect in the United States, and Luxembourg Law and regulations in respect of corporate governance matters might not be as protective of minority shareholders as state corporation laws in the United States. Therefore, our shareholders may have more difficulty in protecting their interests in connection with actions taken by our directors and officers or our principal shareholders than they would as shareholders of a corporation incorporated in the United States.
Neither our Articles nor Luxembourg Law provides for appraisal rights for dissenting shareholders in certain extraordinary corporate transactions that may otherwise be available to shareholders under certain U.S. state laws. As a result of these differences, our shareholders may have more difficulty protecting their interests than they would as shareholders of a U.S. issuer.
Item 4. Information on the Company
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History and development of the company |
Ardagh Group traces its origins back to 1932 in Dublin, Ireland, when the Irish Glass Bottle Company was founded and listed on the Irish Stock Exchange. The Company operated a single glass plant in Dublin, largely serving the domestic beverage and food customer base until 1998, when Yeoman International, led by the current Chairman and Chief Executive Officer and major shareholder, Paul Coulson, took an initial stake in Ardagh, becoming Chairman later that year.
Since 1999, we have played a major role in the consolidation of the global metal and glass packaging industries, completing 23 acquisitions and significantly increasing our scope, scale, and geographic presence. Acquisitions, divestments and investments in greenfield projects to strengthen our position in selected segments have included the following transactions:
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In 1999, we acquired Rockware PLC, from Owens‑Illinois for approximately GBP 247 million, which established the Company as the leading glass packaging producer in the U.K. and Ireland; |
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In 2007, we acquired Rexam PLC’s European glass packaging business for approximately €657 million, broadening our presence across Continental Europe; |
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In 2010, we acquired Impress Group for approximately €1.7 billion, which diversified our presence into metal packaging; |
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In 2012, we acquired Leone Industries Inc., a single plant glass packaging business in New Jersey, United States for approximately $220 million, representing our first expansion into the U.S. glass packaging market. We also acquired Anchor Glass for $880 million, the third largest producer of glass packaging in the United States, operating eight glass packaging plants; |
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In 2014, we completed the acquisition of VNA, the second largest glass packaging producer in North America, with 13 manufacturing plants in the United States, for $1.5 billion. The VNA Acquisition expanded our glass packaging business in North America into new geographies and end‑use categories. We also divested six former Anchor Glass plants and ancillary assets as a condition of gaining approval for this acquisition; |
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In 2015, we completed an investment of approximately $220 million in two new food can‑making facilities in Roanoke, Virginia and Reno, Nevada, as well as a significant expansion of our Conklin, New York, ends plant; |
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In 2016, we acquired 22 plants required to be divested by Ball Corporation and Rexam PLC as a condition of Ball Corporation’s acquisition of Rexam PLC. This acquisition, for a total consideration of €2.7 billion, broadened our presence in metal packaging to include leading global beverage can market positions; and |
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In 2019, we combined our Food & Specialty Metal Packaging business with the business of Exal Corporation, controlled by the Ontario Teachers’ Pension Plan Board, to form Trivium Packaging B.V., a global leader in metal packaging. As consideration, Ardagh received a stake of approximately 42% in Trivium and $2.6 billion in cash proceeds, subject to customary completion adjustments. |
The SEC maintains an internet site at www.sec.gov that contains reports and information statements and other information regarding registrants like us that file electronically with the SEC.
The Company routinely posts important information on the Company website https://www.ardaghgroup.com/corporate/investors. This website and the information contained therein or connected thereto shall not be deemed to be incorporated into this annual report.
We are a leading supplier of innovative, value‑added rigid packaging solutions. Our products include metal beverage cans and glass containers primarily for beverage and food markets, which are characterized by stable, consumer‑driven demand. Our end‑use categories include beer, wine, spirits, CSD, energy drinks, juices and flavored waters. Our customers include a wide variety of leading consumer product companies which value our packaging products for their features, convenience and quality, as well as the end‑user appeal they offer through design, innovation, functionality, premium association and brand promotion. With our significant invested capital base, extensive technological capabilities and manufacturing know‑how, we believe we are well‑positioned to continue to meet the dynamic needs of our global customers. We have mainly built our Company through strategic acquisitions and other corporate transactions and have established leadership positions in large, attractive markets in beverage cans and glass containers.
We serve over 1,500 customers across more than 80 countries, comprised of multi‑national companies, large national and regional companies and numerous local businesses. In our target regions of Europe, North America and Brazil, our customers include a wide variety of CPGs, which own some of the best known brands in the world. We have a stable customer base with long-standing relationships and approximately three quarters of our sales are generated under
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multi‑year contracts, with the remainder largely subject to annual arrangements. A significant portion of our sales volumes are supplied under contracts which include input cost pass‑through provisions, which help us deliver generally consistent margins.
We operate 56 production facilities in 12 countries and employ approximately 16,300 personnel. Our plant network includes 23 metal beverage can production facilities and 33 glass production facilities. Our plants are generally located to serve our customers’ filling locations. Certain facilities may also be dedicated to end‑use categories, enhancing product‑specific expertise and generating benefits of scale and production efficiency. Significant capital has been invested in our extensive network of long‑lived production facilities, which, together with our skilled workforce and related manufacturing process know‑how, supports our competitive positions.
We are committed to market‑leading innovation and product development and maintain dedicated innovation, development and engineering centers in the United States and Europe to support these efforts. These facilities focus on three main areas: (i) innovations that provide enhanced product design, differentiation and user friendliness for our customers and end‑use consumers; (ii) innovations that reduce input costs to generate cost savings for both our customers and us (downgauging and lightweighting); and (iii) developments to meet evolving product safety standards and regulations.
Our sustainability focus is centered on minimizing the impact of our operations and products on the environment, while promoting a healthy and safe workplace for our employees.
In pursuance of this environmental objective we seek to promote recycling of our products, enhance our product design and target continuous improvement in our processes. Metal and glass are both infinitely recyclable, without any degradation in quality, differentiating them from many other packaging substrates. This is expected to continue to enhance their appeal, as consumer awareness of sustainability and the environment grows.
Recycling rates for aluminum beverage cans are relatively high in the geographies in which we operate, estimated at 55% in the United States,76% in Europe and 98% in Brazil. The use of recycled aluminum reduces energy consumption by over 90% compared with the alternative of producing aluminum cans from its virgin source. In glass packaging, we aim to maximize the use of recycled glass, or cullet, in our production process, thereby reducing energy consumption and emissions.
In Europe, the recycling rate for glass packaging is 76% with up to 90% used in some of our furnaces. Recycling rates for glass packaging in the United States are significantly lower at 34%. We are committed to working, including with industry associations, to promote recycling rates in the regions in which we operate. Feve, the European glass federation, has targeted an increase in glass recycling rates in the European Union to 90% by 2030. In addition, we have investments and partnerships in Europe to enhance our supply of cullet and are seeking to increase supply in the United States.
We continuously aim to reduce the material and resource usage in the production of our products, through downgauging (of metal beverage cans) and lightweighting (of glass containers). In addition, we have established specialist groups across our business and promote best practice sharing, to drive continuous improvement.
We have established targets for reductions in energy consumption, emissions, water usage, waste and other metrics and report in our Sustainability Report (available at www.ardaghgroup.com) on progress towards their achievement. We also submit data to CDP (formally the Carbon Disclosure Project) and have been awarded A- in respect of climate change, A in relation to supplier relations and B in the water management category.
We seek to embed a culture of safety awareness across our business and seek to minimize accidents and injuries through continuous training and education.
We have established a Board Sustainability Committee to direct our initiatives in this area and appointed a Chief Sustainability Officer in 2019.
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Our leading global positions have been established through acquisitions, with 23 successful acquisitions completed over the past 21 years. In 2016, we completed the Beverage Can Acquisition, comprising 22 beverage can production facilities in Europe, North America and Brazil which, on a combined basis, we believe is the third largest beverage can business globally.
In addition to organic and acquisitive growth initiatives, we have also expanded our footprint through strategic investments in new capacity to support our customers’ growth, including most recently a new beverage can ends facility in Manaus, Brazil, completed in 2018. These initiatives, as well as other acquisitions and investments over many years, in existing and adjacent end‑use categories, have increased our scale and diversification and provided opportunities to grow our business with both existing and new customers.
Our loss from continuing operations for the year ended December 31, 2019 was $284 million. Adjusted EBITDA and net cash from operating activities for the year ended December 31, 2019 from continuing operations were $1,173 million and $698 million, respectively.
The following chart illustrates the breakdown of our revenue by destination for the year ended December 31, 2019:
Our Industry
The global packaging industry is a large, consumer‑driven industry with stable growth characteristics. We operate in the metal beverage can and glass container sectors and our target regions are Europe, North America and Brazil. Metal beverage cans and glass containers are attractive to brand owners, as their strength and rigidity allows them to be filled at high speeds and easily transported, while their shelf‑stable nature means that refrigeration is not required, thereby resulting in further energy savings in the supply chain. The ability to customize and differentiate products supplied in metal beverage cans and glass containers, through innovative design, shaping and printing, also appeals to our customers. Both the metal and the glass container markets have been marked by progressive downgauging (metal cans) and lightweighting (glass containers), which have generated material savings in input costs and logistics, while enhancing the consumer experience. This reduction in raw material and energy usage in the manufacturing process has also increased the appeal to end‑users, who are increasingly focused on sustainability.
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Our Competitive Strengths
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Leader in Rigid Packaging. We believe we are one of the leading suppliers of metal beverage can and glass packaging solutions, capable of supplying multi-national beverage and food producers in our target markets. We believe that we are the #2 supplier of metal beverage cans by value in Europe. In addition, we believe that we are the #3 supplier of metal beverage cans by value in the United States and Brazil. We believe that we are the #2 supplier of glass packaging by value globally. In the United States, we believe we are the #2 supplier of glass packaging by value, serving the beer, food, wine, spirits and other beverage sectors. In addition, we believe we are the #3 supplier of glass packaging by value in Europe and the #1 supplier of glass packaging by value in Northern Europe, Germany, the United Kingdom and the Nordic region, serving the beer, food, wine, spirits, non-alcoholic beverage and pharmaceutical end-use categories. We believe the combination of our extensive footprint, proximity to customers, efficient manufacturing and high level of customer service underpins our leading positions. |
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Long‑term relationships with diverse blue‑chip customer base. We supply some of the world’s best-known brands with innovative packaging solutions and have been recognized with numerous industry awards. We have longstanding relationships with many of our major customers, which include leading multinational, large national and regional beverage and food companies, as well as numerous local companies. Some of our major customers include AB InBev, Britvic, Coca-Cola, Diageo, Heineken, Monster Beverage, PepsiCo and Grupo Petrópolis, among others. Approximately three-quarters of our revenues are derived from multi-year contracts of between two and ten years, most of which include input cost pass-through provisions. |
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Focus on stable markets. We derive over 90% of our revenues in Europe and North America, mature markets characterized by predictable consumer spending, stable supply and demand and low cyclicality, with the balance largely derived from the Brazilian beverage market, where pack mix shifts and rising consumption have resulted in long-term growth for the metal beverage can industry. Furthermore, over 97% of our revenues are generated from the stable beverage and food end-use categories, including beer, wine, spirits, non-alcoholic and other beverages, as well as vegetables and sauces. |
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Highly contracted revenue base. Approximately three-quarters of our sales are made pursuant to multi-year contracts, with the remainder largely pursuant to annual arrangements. A significant proportion of our sales volumes are supplied under contracts which include mechanisms that help to protect us from earnings volatility related to input costs. Specifically, such arrangements include (i) multi-year contracts that include input cost pass-through and/or margin maintenance provisions and (ii) one-year contracts that allow us to negotiate pricing levels for our products on an annual basis at the same time that we determine our input costs for the relevant year. |
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Well‑invested asset base with significant scale and operational excellence. We operate 56 strategically-located production facilities in 12 countries, enabling us to efficiently serve our customers with high quality and innovative products and services across multiple geographies. We pursue continuous improvement in our facilities by applying our lean manufacturing techniques (‘‘Lean’’). Our Operational Excellence Group and Central Technical Services group in Glass Packaging and our engineering teams in Metal Beverage Packaging supplement our Lean initiatives and promote a culture of consistently pursuing excellence through standardizing and sharing best practices across our network of plants. We believe the total value proposition we offer our customers, in the form of geographic reach, customer service, product quality, reliability and innovation will enable us to continue to drive growth and profitability. |
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Technical leadership and innovation. We have advanced technical and manufacturing capabilities in both metal beverage and glass packaging, including research and development and engineering centers in the United States and Europe, principally based in Elk Grove, Illinois, and Bonn, Germany. In addition, our subsidiary, Heye International, is a leading provider of engineering solutions to the glass container industry |
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globally, with significant proprietary know-how and expertise. We continually seek to improve the quality of our products and processes, through focused investment in new technology. These capabilities have enabled us to develop product and process innovations to meet the dynamic needs of our customers. Our innovations have also been recognized with numerous industry awards and accreditations. We have significant expertise in the production of value-added metal beverage cans, both aluminum and steel, with features such as high-quality graphic designs, colored tabs and tactile finishes. We produce metal beverage cans in a range of sizes and have been a leader in the introduction of lighter aluminum cans. In Glass Packaging, our focus has been on product development, process improvement and cost reduction, which has resulted in progressive advances such as container lightweighting and the increased use of cullet in the production process. This has delivered significant environmental benefits by reducing the use of raw materials and energy. |
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Proven track record of generating attractive growth through successful acquisitions and business optimization. We have grown our business through a combination of acquisitions, organic growth and business optimization, which has significantly increased the size and scope of our Company and the breadth of our product offering. We have successfully integrated these acquired businesses and realized or exceeded targeted cost synergies. We believe we can continue to create value for shareholders through strategic transactions, including acquisitions and business combinations, ongoing optimization and synergy realization. In 1998, under Irish GAAP, our revenue and Adjusted EBITDA were €51 million and €10 million respectively. In 2019, under IFRS, our revenue and Adjusted EBITDA from continuing operations have grown to $6,660 million and $1,173 million, respectively. We believe we maintain attractive margins and generate significant cash flow and returns on capital for our shareholders. For the year ended December 31, 2019, our Adjusted EBITDA margin and our net cash from operating activities from continuing operations were 17.6% and $698 million, respectively. We also believe we can maintain attractive margins and grow cash flow through business mix optimization, growth with new and existing customers, efficiency gains, cost reduction, working capital optimization and disciplined capital allocation. |
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Experienced management team with a proven track record and high degree of shareholder alignment. Members of our management team with extensive experience in the consumer packaging industry have demonstrated their ability to manage costs, adapt to changing market conditions, undertake strategic investments and acquire and integrate new businesses, thereby driving significant value creation. Our board of directors, led by our Chairman and Chief Executive Officer, has a high degree of indirect ownership in our Company, which we believe promotes efficient capital allocation decisions and results in strong shareholder alignment and commitment to further shareholder value creation. |
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Our Business Strategy
Our principal objective remains to increase shareholder value by achieving growth in Adjusted EBITDA and cash generation. We aim to achieve this objective through organically growing our business, but will also continue to evaluate other acquisitions and strategic opportunities to enhance shareholder value. We pursue these objectives through the following strategies:
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Grow Adjusted EBITDA and cash flow. We seek to leverage our extensive footprint, proximity to customers, efficient manufacturing and high level of customer service to grow revenue with new and existing customers, improve our productivity, and reduce our costs. To increase Adjusted EBITDA, we will continue to take decisive actions with respect to our assets and invest in our business, in line with our stringent investment criteria. To increase cash generation, we continue to actively manage our working capital and capital expenditures. |
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Enhance product mix and profitability. We have enhanced our product mix over the years by replacing lower margin business with higher margin business and by pursuing growth opportunities in new and emerging end-use categories of the beverage and food markets. We will continue to develop long-term partnerships with our customers and selectively pursue such opportunities with existing and new customers that will grow our business and enhance our overall profitability. |
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Apply leading process technology and technical expertise. We intend to continue increasing productivity through the deployment of leading technology (including our in-house engineering, innovation and design capabilities), and development and dissemination of best practices and know-how across our operations. |
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Emphasize operational excellence and optimize manufacturing base. In managing our businesses, we seek to improve our efficiency, control our costs and preserve and expand our margins. We have consistently reduced total costs through implementing operational efficiencies, streamlining our manufacturing base and investing in advanced technology to enhance our production capacity. We continue to take actions to reduce costs by optimizing our manufacturing footprint, including through further investment in advanced technology and automation. |
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Carefully evaluate and pursue acquisitions and other strategic opportunities. We have achieved our current market positions by selectively pursuing acquisition and other strategic opportunities. Although our near term focus is to deliver through a combination of targeted growth investments and free cash flow generation, we will continue to evaluate opportunities in line with our objectives. We may selectively explore acquisitions and other strategic initiatives, in line with our stringent investment criteria and focus on enhancing shareholder value. |
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Our Divisions
Today, we manage our business in two divisions, Metal Beverage Packaging and Glass Packaging. The following charts illustrate the breakdown of our revenue and Adjusted EBITDA for the year ended December 31, 2019:
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We are organized into four operating and reportable segments, Europe and Americas in Metal Beverage Packaging, and Europe and North America in Glass Packaging. The Group changed the composition of its operating and reporting segments following the disposal of its Food & Specialty Metal Packaging business which completed on October 31, 2019. Adjusted EBITDA is the performance measure used to manage and assess performance of our reportable segments.
Metal Beverage Packaging
We are one of the leading suppliers of consumer metal beverage packaging in the world. Following the Beverage Can Acquisition, we believe that we hold the #2 or #3 market positions in the beverage can industry in Europe, the United States and Brazil.
Metal Beverage Packaging sales represented approximately 51% of our total continuing operations revenues in 2019. Revenues and Adjusted EBITDA for Metal Beverage Packaging were $3,372 million and $503 million, respectively. For a discussion of the impact of seasonality on the Metal Beverage Packaging division, see “Item 5.—Operating and Financial Review and Prospects”.
The global packaging industry is a large, consumer-driven industry with stable growth characteristics. Within the $105 billion global metal packaging industry, the metal can packaging market is comprised of beverage cans (45%), food cans (30%), aerosol cans (10%) and other cans (15%), according to Smithers Pira*, a leading independent market research firm with extensive specialized experience in the packaging, paper and print industries. We compete in the beverage can sector of the consumer metal packaging industry. We estimate the beverage can sector to be approximately $25 billion with more than 300 billion beverage cans produced globally every year, of which nearly 90% were aluminum cans and the remainder of which were steel cans. Because the consumer metal beverage packaging industry primarily supplies packaging for food, drinks and other basic needs, it is considered to be a relatively stable market sector that is less sensitive to economic cycles than many other industries.
* Source: Smithers Pira—The Future of Metal Cans to 2023 (May 2018).
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Manufacturing and Production
As of December 31, 2019, we operated 23 production facilities in 9 countries and had approximately 4,600 employees. Our plants are currently located in 7 European countries, as well as in Brazil and the United States.
The following table summarizes Metal Beverage Packaging’s principal production facilities as of December 31, 2019.
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Other European countries(1) |
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(1)One facility in each of Austria, France, The Netherlands, Poland and Spain.
Industry Overview
We operate in the beverage can segment of the consumer metal packaging industry.
The beverage can sector is growing in each of Europe, North America and Brazil. Growth in unit volumes of specialty beverage cans has exceeded growth in standard beverage cans, thereby increasing specialty can penetration, a trend that is expected to continue.
We believe the purchasing decisions of retail consumers are significantly influenced by packaging. Consumer product manufacturers and marketers are increasingly using packaging to position their products in the market and differentiate them from alternative products. A growing awareness of sustainability issues among consumers, as well as potential regulatory or legislative changes in this area, are also expected to influence future packaging decisions by consumer product manufacturers. The development and production of premium, differentiated packaging products with additional value-added features require a higher level of design capabilities, manufacturing and process know-how and quality control than for more standardized products.
We operate production facilities in Europe, the United States and Brazil, and sell metal beverage cans to national and international customers in these regions. We supply leading manufacturers in each of the markets we serve, including AB InBev, Britvic, Coca-Cola, Diageo, Heineken, Monster Beverage, PepsiCo and Grupo Petrópolis, among others.
The top ten Metal Beverage Packaging customers represented approximately 65% of Metal Beverage Packaging revenues in 2019. Overall, Metal Beverage Packaging’s revenue is backed by multi-year supply agreements, typically ranging from three to five years in duration. These contracts generally provide for the pass-through of metal price fluctuations and, in most cases, most of variable cost movements, while others have tolling arrangements whereby customers arrange for the procurement of metal themselves. In addition, within multi-year relationships, both parties can work together to streamline the product, service and supply process, leading to significant cost reductions and improvements in product and service, with benefits arising to both parties. Wherever possible, we seek to enter into multi-year supply agreements with our customers. In other cases, sales are made under commercial supply agreements, typically of one-year’s duration, with prices based on expected purchase volumes.
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Competitors
Our principal competitors in metal beverage packaging include Ball Corporation, Crown Holdings, and Can Pack.
The principal raw materials used in Metal Beverage Packaging are aluminum, steel, coatings and lining compounds. Over 95% of our metal raw material spend in 2019 related to aluminum. Our major aluminum suppliers include Constellium, Hydro, Novelis and Tri-Arrows.
We continuously seek to minimize the price of raw materials and reduce exposure to price movements in a number of ways, including the following:
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harnessing the scale of our global metal purchasing requirements, to achieve better raw materials pricing; |
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entering into variable-priced pass-through contracts with customers, whereby selling prices are indexed to the price of the underlying raw materials; |
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maintaining the focus on metal content reduction; |
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continuing the process of reducing spoilage and waste in manufacturing; |
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rationalizing the number of both specifications and suppliers; and |
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hedging the price of aluminum ingot and the related euro/U.S. dollar exposure. |
Aluminum is typically purchased under three-year contracts, with prices that are fixed in advance. Despite an increase in the level of aluminum production being targeted to new end-use applications, including automotive and aerospace, we believe that adequate quantities of the relevant grades of packaging aluminum will continue to be available from various producers and that we are not overly dependent upon any single supplier. Some of our aluminum requirements are subject to tolling arrangements with our customers, whereby risk and responsibility for the procurement of aluminum is managed by the customer.
Distribution
We use various freight and haulage contractors to make deliveries to customer sites or warehousing facilities. In some cases, customers make their own delivery arrangements and therefore may purchase from us on an ex‑works basis. Warehousing facilities are primarily situated at our manufacturing facilities; however, in some regions, we use networks of externally‑rented warehouses at strategic third‑party locations, close to major customers’ filling operations.
Innovation, Research and Development
The majority of Metal Beverage Packaging’s innovation, development and engineering activities are primarily concentrated at our regional technical center in Elk Grove, Illinois and at our research and development facility in Bonn, Germany. These centers focus on identifying and serving the existing and potential needs of customers, including the achievement of cost reductions, particularly metal content reduction, new product innovation and meeting new and anticipated legislative requirements, as well as providing technology, engineering and support services to our product facilities.
Metal Beverage Packaging currently holds and maintains a number of patent families, filed in several jurisdictions and covering a range of different products.
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Glass Packaging
We manufacture both proprietary and non‑proprietary glass containers for a variety of end‑use categories, mainly beverage and food. Our proprietary products are customized to the exact specifications of our customers and play an important role in their branding strategies. Our non‑proprietary products deliver consistent performance and product differentiation through value‑added decoration, including embossing, coating, printing and pressure‑sensitive labeling. Our product offerings and continuing focus on operational excellence have enabled us to meet and exceed our customers’ requirements and consistently generate margins in Glass Packaging that compare well with other large competitors in the sector.
Glass Packaging revenues represented 49% of our total continuing operations revenues in 2019. For a discussion of the impact of seasonality on the Glass Packaging division, see “Item 5.—Operating and Financial Review Prospects”.
We believe we are the #1 supplier of glass packaging in Northern Europe by market share and the #3 supplier in Europe overall by market share, as well as the #2 supplier in the U.S. market by market share.
In addition to the manufacturing of proprietary and non-proprietary glass containers, Glass Packaging includes our glass engineering business, Heye International, which designs and supplies glass packaging machinery and spare parts for existing glass packaging machinery. We also provide technical assistance to third‑party users of our equipment and licensees of our technology. For the 2019 fiscal year, these activities represented approximately 2% of Glass Packaging’s revenues.
As of December 31, 2019, we operated 33 glass plants with 68 glass furnaces and had approximately 11,700 employees. We have glass manufacturing facilities in Denmark, Germany, Italy, the Netherlands, Poland, Sweden, the United Kingdom and the United States. We believe that our facilities are well maintained and that we generally have sufficient capacity to satisfy current and expected demand. We own all of our manufacturing facilities, some of which are subject to finance leases or similar financial arrangements. Certain of our warehousing facilities are leased from third parties.
The following table summarizes Glass Packaging’s principal production facilities as of December 31, 2019.
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Germany |
8 |
|
Netherlands |
2 |
|
Poland |
3 |
|
United Kingdom |
4 |
|
Other European countries(1) |
3 |
|
|
33 |
(1)Denmark, Italy and Sweden.
Industry Overview
Glass packaging is utilized in a wide range of end‑use categories in the beverage and food market, as well as in applications such as pharmaceuticals, cosmetics and personal care. We principally operate in the beverage and food
Ardagh Group S.A.
40
end‑use categories and benefit from the premium appeal of glass packaging to spirits, craft beer, wine and other brand owners, as higher levels of design and differentiation support end‑user brand perception and loyalty.
We believe the purchasing decisions of retail consumers are significantly influenced by packaging. Consumer product manufacturers and marketers are increasingly using packaging as a means to position their products in the market and differentiate them on retailers’ shelves. The development and production of premium, specialized packaging products with a combination of value‑added features requires a higher level of design capabilities, manufacturing and process know‑how and quality control than for more standardized products. The glass packaging industry has continued to produce advances in light‑weighting technology and energy efficiency over many years, delivering supply chain benefits, as well as reducing raw material and energy usage in the manufacturing process, thereby increasing the appeal to end‑users, who are increasingly focused on sustainability.
In certain end‑use categories, such as beer, wine, spirits and non‑alcoholic beverages, revenues are relatively concentrated among key customers with whom we have strong, long‑term relationships, mirroring the recent consolidation in these end‑use categories. Our top ten customers in Glass Packaging accounted for 41% of total glass revenues in 2019. Some of our largest and longest‑standing customers include AB InBev, Bacardi, Carlsberg, Coca‑Cola, Constellation Brands, Diageo, Heineken, J.M. Smucker, The Kraft Heinz Company, PepsiCo, Pernod Ricard, Sazerac, and Treehouse Foods.
Glass packaging revenues are made pursuant to multi-year supply arrangements, a majority of which allow us to recover input cost inflation on some or all of our cost base. Our remaining revenues are subject to shorter arrangements, largely annual, which have provided, and which we expect will continue to provide, the basis for long‑term partnership with our customers. These customer arrangements are typically renegotiated annually (in terms of price and expected volume) and typically we have been able to recover the majority of input cost inflation which has impacted our cost base, as demonstrated by the generally consistent margins we have generated in the past, despite occasional volatility in certain input costs such as energy and freight and logistics costs.
Competitors
Our principal competitors in glass packaging include Anchor Glass and Owens‑Illinois in North America and Owens‑Illinois, Verallia and Vidrala in Europe.
Energy, Raw Materials and Suppliers
We use natural gas, electricity, oil and oxygen to fuel our furnaces. We have developed substantial backup systems, which protect our operations in the case of an interruption of our primary energy sources. We have multiple energy suppliers in both Europe and the United States, with contractual pricing arrangements typically linked to the relevant market index. We seek to mitigate the inherent risk in energy price fluctuations through a combination of contractual customer pass‑through agreements, fixed‑price procurement contracts, index tracking procurement contracts and hedging.
We have developed an active hedging strategy. In Europe, we typically hedge in small tranches and our policy is to hedge approximately 70% of our energy requirements before the beginning of the following year. In North America, customer contracts are almost exclusively multi‑year and provide for the pass‑through of movements in energy costs. Consequently, in North America our purchasing strategy for energy mirrors our customer contracts.
The primary raw materials used in our glass manufacturing operations are cullet, sand, soda ash and limestone. We have several country suppliers of cullet and a number of global and regional suppliers of soda ash. We seek to optimize the use of recycled glass in our production process as this enables the other raw materials to melt at lower temperatures, thereby lowering our energy costs and carbon emissions and prolonging furnace life.
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41
Distribution
We use various freight and haulage contractors to make deliveries to customer sites or warehousing facilities. In some cases, customers make their own delivery arrangements and therefore may purchase from us on an ex‑works basis. Warehousing facilities are primarily situated at our manufacturing facilities; however, in some regions, we use networks of externally‑rented warehouses at strategic third‑party locations, close to major customers’ filling operations.
Intellectual Property and Innovation, Development and Engineering
Heye International has an extensive portfolio of patents covering the design of equipment for the manufacture of glass packaging. It also has substantial proprietary knowledge of the technology and processes involved in the production of glass packaging, based on its history of more than 40 years as a leading supplier of engineering solutions to the industry globally. It has entered into a large number of agreements to provide technical assistance and technology support to glass packaging manufacturers for which it receives annual fees.
We support an innovation, development and design effort, particularly at Heye International, which we believe is important to our ability to compete effectively. We are a member of glass research associations and other organizations that are engaged in initiatives aimed at improving the manufacturing processes and the quality and design of products, while continuing to meet our environmental responsibilities. In addition, we have three glass engineering facilities in Europe and the United States and we operate one of the largest in‑house decoration facilities in the European glass packaging industry.
Joint Venture
We hold a stake of approximately 42% in Trivium Packaging B.V. Trivium is a leading supplier of innovative, value-added, infinitely-recyclable metal packaging solutions with revenues of approximately $2.7 billion. Its products principally comprise metal packaging in the form of cans and aerosol containers, serving a broad range of end-use categories, including food, seafood, pet food and nutrition, as well as beauty and personal care. Trivium’s customer base spreads over 1,300 customers across more than 70 countries, comprised of multi-national companies, large national and regional companies and small local businesses. In its target regions of Europe, North America and South America, its customers include a wide variety of consumer packaged goods companies, which own some of the best-known brands in the world. Trivium has 56 facilities, located in 21 countries, and has approximately 7,800 employees.
In connection with the formation of Trivium, Ardagh entered into a shareholders agreement with Element Holdings II L.P., an entity controlled by Ontario Teachers, (the “JV Partner”) and Trivium (the “Trivium Shareholders Agreement), containing provisions relating to the governance of Trivium, including (i) the formation of a nine person supervisory board (including up to five members to be designated or nominated by the JV Partner and up to four members to be designated or nominated by Ardagh) and (ii) the formation of a management board. The Trivium Shareholders Agreement reserves certain matters that require the approval of shareholders holding shares constituting at least 70% of the then-outstanding shares of Trivium, including its annual budget and five year business plan, material acquisitions or dispositions, mergers, demergers or consolidations, issuances or repurchases of its shares, incurrence of indebtedness over a certain amount, incurrence of unbudgeted capital expenditure (over a certain limit), related party transactions, distributions or dividends, the adoption of a management incentive plan, or a change in accounting policies, the adoption of the audited financial statements or the appointment or termination of members of the senior management team.
The Trivium Shareholders Agreement contains a non-competition covenant providing that none of the JV Partner or its subsidiaries and none of Ardagh or its subsidiaries will, directly or indirectly, engage in the development, manufacture, marketing or sale of metal food or specialty cans (including aerosol cans), in each case as developed, manufactured, marketed or sold by Trivium as of the date of the Trivium Shareholders Agreement), with certain limited exceptions; provided, that Ardagh is permitted to develop, manufacture, market or sell containers for the beverage market, including aluminum bottles.
Ardagh Group S.A.
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The Trivium Shareholders Agreement contains customary non-solicitation covenants restricting the JV Partner and Ardagh from soliciting or hiring individuals who are employed by the other party or its affiliates. The Trivium Shareholders Agreement also contains provisions restricting the transfer of Trivium shares prior to an initial public offering of Trivium, including granting the non-transferring shareholder “tag-along” rights on customary terms. In addition, the Trivium Shareholders Agreement grants the JV Partner and Ardagh certain additional rights with respect to their Trivium shares, including pre-emptive rights, registration rights, certain liquidity rights, and purchase rights in the event Ardagh or the JV Partner undergoes a change of control.
Environmental, Health and Safety and Product Safety Regulation
Our operations and properties are regulated under a wide range of laws, ordinances and regulations and other legal requirements concerning the environment, health and safety and product safety in each jurisdiction in which we operate. We believe that our manufacturing facilities are in compliance, in all material respects, with these laws and regulations.
The principal environmental issues facing us include the impact on air quality through gas and particle emissions, including the emission of greenhouse gases, the environmental impact of the disposal of water used in our production processes, generation and disposal of waste, the receiving, use and storage of hazardous and non‑hazardous materials and the potential contamination and subsequent remediation of land, surface water and groundwater arising from our operations.
Our substantial operations in the EU are subject to, among additional requirements, the requirements of the IED which requires that operators of industrial installations, including glass manufacturing and can making installations, take into account the whole environmental performance of the installation and obtain and maintain compliance with a permit, which sets emission limit values that are based on best available techniques.
Our EU glass production facilities are also regulated under the EU Emissions Trading Scheme, now in its third phase which runs until December 31, 2020. Under this regime, the European Commission sets emission caps for greenhouse gases for all installations covered by the scheme, which are then implemented by the EU member states. Installations that emit less than their greenhouse gas emission cap can sell emission allowances on the open market and installations that exceed their emission cap are required to buy emission allowances and are penalized if they are unable to surrender the required amount of allowances at the end of each trading year. California has enacted a similar greenhouse gas reduction scheme that works on a cap and trade basis and that applies to our manufacturing operations in the state, requiring us to purchase offsets against our greenhouse gas emissions. Other states where we have operations, such as Washington, are expected to implement similar programs. In addition, the EPA has also begun to regulate certain greenhouse gas emissions under the Clean Air Act.
Furthermore, the EU Directive on environmental liability with regard to the prevention and remedying of environmental damage aims to make those who cause damage to the environment (specifically damage to habitats and species protected by EU law, damage to water resources and land contamination which presents a threat to human health) financially responsible for its remediation. It requires operators of industrial premises (including those which hold a permit governed by the IED) to take preventive measures to avoid environmental damage, inform the regulators when such damage has or may occur and to remediate contamination.
Our operations are also subject to stringent and complex U.S. federal, state and local laws and regulations relating to environmental protection, including the discharge of materials into the environment, health and safety and product safety including, but not limited to: the U.S. federal Clean Air Act, the U.S. federal Water Pollution Control Act of 1972, the U.S. federal Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”). These laws and regulations may, among other things (i) require obtaining permits to conduct industrial operations; (ii) restrict the types and quantities and concentration of various substances that can be released into the environment; (iii) result in the suspension or revocation of necessary permits, licenses and authorizations; (iv) require that additional pollution controls be installed and (v) require remedial measures to mitigate pollution from
Ardagh Group S.A.
43
former and ongoing operations, including related natural resource damages. Specifically, certain U.S. environmental laws, such as CERCLA, or Superfund, and analogous state laws, provide for strict, and under certain circumstances, joint and several liability for the investigation and remediation of releases or the disposal of regulated materials into the environment including soil and groundwater, as well as for damages to natural resources.
In North America, sales of beverage cans and bottles are affected by governmental regulation of packaging, including deposit return laws. As of January 1, 2019, there were ten U.S. states with container deposit laws in effect, requiring consumer deposits of between 5 and 15 cents (USD), depending on the size of the container or product. In Canada, there are 10 provinces and three territories. Deposit laws cover some form of beverage container in all provinces and territories except the territory of Nunavut, which does not have a deposit program. The range for deposits are between 5 and 40 cents (Canadian Dollar), depending on size of container and type of beverage.
A wider roll out of packaging deposit return systems (DRS) in Europe can lead to cost increases for collection and recycling of glass containers and beverage cans and therefore potentially have impacts on the packaging material mix at retailers.
Many beverages and containers, particularly new product innovations and unique alcohol beverage products, are not clearly defined in U.S. and Canadian deposit laws. The text of some U.S. and Canadian deposit laws expressly exempts certain beverages or containers from application of the deposit laws. In many states, certain common beverage categories are simply not found in the text of the deposit law. Local agencies provide final decisions on the application of deposit laws.
We are also committed to ensuring that safe operating practices are established, implemented and maintained throughout our organization. In addition, we have instituted active health and safety programs throughout our company. See “Item 3. Key Information—Risk Factors—Risks Relating to Our Business—We are subject to various environmental and other legal requirements and may be subject to new requirements of this kind in the future that could impose substantial costs upon us”.
Ardagh Group S.A.
44
|
C. |
|
Organizational structure |
The following table provides information relating to our principal operating subsidiaries, all of which are wholly owned, at December 31, 2019.
|
|
|
|
|
|
|
Country of |
|
|
Company |
|
incorporation |
|
Activity |
Ardagh Metal Beverage Manufacturing Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Latas Indústria de Embalagens de Alumínio do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Indústria de Embalagens de Metálicas do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Glass Holmegaard A/S |
|
Denmark |
|
Glass Packaging |
Ardagh Metal Beverage Trading France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Metal Beverage France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Glass GmbH |
|
Germany |
|
Glass Packaging |
Heye International GmbH |
|
Germany |
|
Glass Engineering |
Ardagh Metal Beverage Trading Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Glass Sales Limited |
|
Ireland |
|
Glass Packaging |
Ardagh Packaging Holdings Limited |
|
Ireland |
|
Glass and Metal Beverage Packaging |
Ardagh Glass Italy S.r.l. |
|
Italy |
|
Glass Packaging |
Ardagh Glass Dongen B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Glass Moerdijk B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Metal Beverage Trading Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Glass S.A. |
|
Poland |
|
Glass Packaging |
Ardagh Metal Beverage Trading Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Glass Limmared AB |
|
Sweden |
|
Glass Packaging |
Ardagh Metal Beverage Europe GmbH |
|
Switzerland |
|
Metal Beverage Packaging |
Ardagh Glass Limited |
|
United Kingdom |
|
Glass Packaging |
Ardagh Metal Beverage Trading UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Metal Beverage UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Glass Inc. |
|
United States |
|
Glass Packaging |
Ardagh Metal Beverage USA Inc. |
|
United States |
|
Metal Beverage Packaging |
|
D. |
|
Property, plant and equipment |
See "Item 4.—Information on the Company—B. Business Overview—Metal Beverage Packaging-Manufacturing and Production" and Item 4.—Information on the Company—B. Business Overview—Glass Packaging-Manufacturing and Production".
Item 4A. Unresolved Staff Comments
Not Applicable
Ardagh Group S.A.
45
Item 5. Operating and Financial Review and Prospects
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read together with, and is qualified in its entirety by reference to the audited consolidated financial statements of Ardagh Group S.A. for the three‑year period ended December 31, 2019, including the related notes thereto, included elsewhere in this annual report. The following discussion should also be read in conjunction with “Selected Financial Information”. As used in this section, the “Group” refers to Ardagh Group S.A. and its subsidiaries.
Some of the measures used in this annual report are not measurements of financial performance under IFRS and should not be considered an alternative to cash flow from operating activities as a measure of liquidity or an alternative to operating profit/(loss) or profit/(loss) for the year, as indicators of our operating performance or any other measures of performance derived in accordance with IFRS.
Business Drivers
The main factors affecting our results of operations for Metal Beverage Packaging and Glass Packaging are: (i) global economic trends and end-consumer demand for our products; (ii) prices of energy and raw materials used in our business, primarily aluminum, steel, cullet, sand, soda ash and coatings, and our ability to pass through these and other cost increases to our customers, through contractual pass through mechanisms under multi-year contracts, or through renegotiation in the case of short-term contracts; (iii) investment in operating cost reductions; (iv) acquisitions; and (v) foreign exchange rate fluctuations and currency translation risks arising from various currency exposures, primarily with respect to the euro, U.S. dollar, British pound, Swedish krona, Polish zloty, Danish krone and Brazilian real.
In addition, certain other factors affect revenue and operating profit/(loss) for Metal Beverage Packaging and Glass Packaging.
Metal Beverage Packaging
Metal Beverage Packaging generates its revenue from supplying metal can packaging to the beverage end use category. Revenue is primarily dependent on sales volumes and sales prices.
Sales volumes are influenced by a number of factors, including factors driving customer demand, seasonality and the capacity of our metal beverage packaging plants. Demand for our metal beverage cans may be influenced by trends in the consumption of beverages, industry trends in packaging, including marketing decisions, and the impact of environmental regulations and shifts in consumer sentiment towards a greater awareness of sustainability issues. The demand for our beverage products is strongest during spells of warm weather and therefore demand typically peaks during the summer months, as well as in the period leading up to holidays in December. Accordingly, we generally build inventories in the first and fourth quarter in anticipation of the seasonal demands in our beverage business.
Metal Beverage Packaging’s Adjusted EBITDA is based on revenue derived from selling our metal beverage cans and is affected by a number of factors, primarily cost of sales. The elements of Metal Beverage Packaging’s cost of sales include (i) variable costs, such as electricity, raw materials (including the cost of aluminum), packaging materials, decoration and freight and other distribution costs, and (ii) fixed costs, such as labor and other plant-related costs including depreciation, maintenance and sales, marketing and administrative costs. Metal Beverage Packaging’s variable costs have typically constituted approximately 75% and fixed costs approximately 25% of the total cost of sales for our Metal Beverage Packaging business.
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46
Glass Packaging
Glass Packaging generates its revenue principally from selling glass containers. Glass Packaging revenue is primarily dependent on sales volumes and sales prices. Glass Packaging includes our glass engineering business, Heye International.
Sales volumes are affected by a number of factors, including factors impacting customer demand, seasonality and the capacity of Glass Packaging’s plants. Demand for glass containers may be influenced by trends in the consumption of beverages, fruit and vegetable harvests, industry trends in packaging, including marketing decisions, and the impact of environmental regulations, as well as changes in consumer sentiment including a greater awareness of sustainability issues.
In the U.S., for example, the growth in consumption of imported beer has seen reduced demand for domestically-produced mass beer brands, resulting in reduced demand for glass packaging for this end-use category. Recent years have also seen an increase in the imports of empty glass containers into the United States. In response, the Group reduced production capacity in its Glass Packaging North America division by over 10%, including the permanent closure of its Milford, Massachusetts, facility in 2018 and its Lincoln, Illinois, facility in 2019. In addition, in 2019, we filed anti-dumping and countervailing duty petitions against Chinese glass container imports at the International Trade Commission and Department of Commerce in Washington D.C.. In late 2019, the ITC preliminarily found a reasonable indication of material injury to domestic producers from such imports. In February 2020, the Department of Commerce issued an affirmative preliminary determination of countervailing duty rates ranging from 22.60% to 315.73%. The Department of Commerce is to issue its preliminary determination of antidumping rates in April.
The Group is pursuing growth opportunities in stronger performing end-markets, including food, wines and spirits and has converted production capacity from the mass beer sector to serve these alternative end-markets. Investments in advanced inspection equipment and automation have also been undertaken, and continue to be undertaken, in order to enhance quality and productivity.
Beverage sales within our Glass Packaging business are seasonal in nature, with strongest demand during the summer and during periods of warm weather, as well as the period leading up to holidays in December. Accordingly, Glass Packaging’s shipment volumes of glass containers is typically lower in the first quarter. Glass Packaging builds inventory in the first quarter in anticipation of these seasonal demands. In addition, Glass Packaging generally schedules shutdowns of its plants for furnace rebuilding and repairs of machinery in the first quarter. These strategic shutdowns and seasonal sales patterns adversely affect profitability in Glass Packaging’s glass manufacturing operations during the first quarter of the year. Plant shutdowns may also affect the comparability of results from period to period. Glass Packaging’s working capital requirements are typically greatest at the end of the first quarter of the year.
Glass Packaging’s Adjusted EBITDA is based on revenue derived from selling glass containers and glass engineering products and services and is affected by a number of factors, primarily cost of sales. The elements of Glass Packaging’s cost of sales for its glass container manufacturing business include (i) variable costs, such as natural gas and electricity, raw materials (including the cost of cullet), packaging materials, decoration and freight and other distribution costs, and (ii) fixed costs, such as labor and other plant-related costs including depreciation, maintenance and sales, marketing and administrative costs. Glass Packaging’s variable costs have typically constituted approximately 40% and fixed costs approximately 60% of the total cost of sales for our glass container manufacturing business.
Recent Acquisitions and Divestments
Divestment of Food & Specialty Metal Packaging
On October 31, 2019, the Group completed the combination of its Food & Specialty Metal Packaging business, operating as part of the Metal Packaging Europe and Metal Packaging Americas segments, with the business of Exal, to form Trivium, a global leader in metal packaging. As a result of the completion of the transaction, the Food & Specialty
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Metal Packaging business has been reported as a discontinued operation. As consideration, Ardagh received a stake of approximately 42% in Trivium and $2.6 billion in cash proceeds. See, “Item 4. Information on the Company-History and development of the company.”
The Beverage Can Acquisition
On June 30, 2016, the Group closed the Beverage Can Acquisition for total consideration of $3.0 billion.
Critical Accounting Policies
We prepare our financial statements in accordance with IFRS as issued by the IASB. A summary of significant accounting policies is contained in Note 2 to our audited consolidated financial statements for the three years ended December 31, 2019. In applying accounting principles, we make assumptions, estimates and judgments which are often subjective and may be affected by changing circumstances or changes in our analysis. Material changes in these assumptions, estimates and judgments have the potential to materially alter our results of operations. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
Business combinations and goodwill
All business combinations are accounted for by applying the purchase method of accounting. This involves measuring the cost of the business combination and allocating, at the acquisition date, the cost of the business combination to the assets acquired and liabilities assumed. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.
The determination of the fair value of the assets and liabilities is based, to a considerable extent, on management’s judgment. Allocation of the purchase price affects the results of the Group as finite lived intangible assets are amortized, whereas indefinite lived intangible assets, including goodwill, are not amortized and could result in differing amortization charges based on the allocation to indefinite lived and finite lived intangible assets.
The cost of an acquisition is measured as the aggregate of the consideration transferred, which is measured at acquisition date fair value, and the amount of any non‑controlling interests in the acquiree. For each business combination, the Group elects whether to measure the non‑controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition‑related costs are expensed as incurred and included in sales, general and administration expenses.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.
Any contingent consideration to be transferred by the acquirer will be recognized at fair value at the acquisition date.
Goodwill represents the excess of the cost of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to those groups of CGUs that are expected to benefit from the business combination in which the goodwill arose for the purpose of assessing impairment. Goodwill is tested annually for impairment.
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Where goodwill has been allocated to a CGU and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash‑generating unit retained.
Impairment of goodwill
Goodwill acquired through a business combination has been allocated to groups of CGUs for the purpose of impairment testing based on the segment into which the business combination is assimilated. The groupings represent the lowest level at which the related goodwill is monitored for internal management purposes. As at the reporting date, Metal Beverage Packaging Europe, Metal Beverage Packaging Americas, Glass Packaging Europe and Glass Packaging North America were the groups of CGUs to which goodwill was allocated and monitored.
The Group used the value-in-use (“VIU”) model for the purposes of the goodwill impairment testing as this reflects the Group’s intention to hold and operate the assets. However, if an impairment indicator exists for a CGU, the Group uses both the VIU model and the fair value less costs to sell (“FVLCTS”) model to establish the higher of the recoverable amount.
The VIU model used the 2020 budget approved by the board and a two-year forecast for 2021 to 2022. The budget and forecast results were then extended for a further two‑year period making certain assumptions including that long-term depreciation equals capital expenditure and that any increase in input cost will be passed through to customers, in line with historic practice and contractual terms.
The terminal value assumed long-term growth based on a combination of factors including long-term inflation in addition to industry and market specific factors. The terminal value is estimated based on capitalizing the year 5 cash flows in perpetuity. The range of growth rates applied by management in respect of the terminal values applicable to all groups of CGU’s were 1.0% - 1.5% (2018: 1.5%).
Cash flows considered in the VIU model included the cash inflows and outflows related to the continuing use of the assets over their remaining useful lives, expected earnings, required maintenance capital expenditure, depreciation, amortization, tax paid, working capital and lease principal repayments.
The discount rate applied to cash flows in the VIU model was estimated using our weighted average cost of capital as determined by the Capital Asset Pricing Model with regard to the risks associated with the cash flows being considered (country, market and specific risks of the asset).
The modelled cash flows take into account the Group’s established history of earnings, cash flow generation and the nature of the markets in which we operate, where product obsolescence is low. The key assumptions employed in modelling estimates of future cash flows are subjective and include projected Adjusted EBITDA, discount rates and growth rates, replacement capital expenditure requirements, rates of customer retention and the ability to maintain margin through the pass through of input cost inflation.
The discount rates used ranged from 5.1% ‑ 8.5% (2018: 6.7% ‑ 9.6%). These rates are pre‑tax. These assumptions have been used for the analysis for each group of CGU. Management determined budgeted cash flows based on past performance and its expectations for the market development.
For all CGUs, a sensitivity analysis was performed reflecting potential variations in terminal growth rate and discount rate assumptions. In all cases the recoverable values calculated were in excess of the carrying values of the CGUs. The variation applied to terminal value growth rates and discount rates was a 50 basis points decrease and increase respectively and represents a reasonably possible change to the key assumptions of the VIU model. Further, a reasonably
Ardagh Group S.A.
49
possible change to the operating cash flows would not reduce the recoverable amounts below the carrying value of the CGUs.
Income taxes
We are subject to income taxes in numerous jurisdictions. Significant judgment is required in determining the worldwide provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.
Measurement of defined benefit obligations
We follow guidance of IAS 19 to determine the present value of our obligations to current and past employees in respect of defined benefit pension obligations, other long‑term employee benefits and other end of service employee benefits, which are subject to similar fluctuations in value in the long-term. We, with the assistance of a network of professionals, value such liabilities designed to ensure consistency in the quality of the key assumptions underlying the valuations.
The principal pension assumptions used in the preparation of the financial statements take account of the different economic circumstances in the countries in which we operate and the different characteristics of the respective plans including the length of duration of liabilities.
The ranges of the principal assumptions applied in estimating defined benefit obligations were:
Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience.
These assumptions translate into the following average life expectancy in years for a pensioner retiring at age 65. The mortality assumptions for the countries with the most significant defined benefit plans are set out below:
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|
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U.S. |
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Germany |
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UK |
||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
Years |
|
Years |
|
Years |
|
Years |
|
Years |
|
Years |
Life expectancy, current pensioners |
|
21 |
|
22 |
|
22 |
|
22 |
|
21 |
|
20 |
Life expectancy, future pensioners |
|
23 |
|
23 |
|
24 |
|
24 |
|
22 |
|
21 |
If the discount rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would increase by an estimated $186 million (2018: $193 million). If the discount rate were to increase by 50 basis points, the carrying amount of the pension obligations would decrease by an estimated $166 million (2018: $173 million).
Ardagh Group S.A.
50
If the inflation rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would decrease by an estimated $56 million (2018: $85 million). If the inflation rate were to increase by 50 basis points, the carrying amount of the pension obligations would increase by an estimated $63 million (2018: $94 million).
If the salary increase rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would decrease by an estimated $61 million (2018: $90 million). If the salary increase rate were to increase by 50 basis points, the carrying amount of the pension obligations would increase by an estimated $69 million (2018: $99 million).
The impact of increasing the life expectancy by one year would result in an increase in the Group’s liability of $68 million at December 31, 2019 (2018: $66 million), holding all other assumptions constant.
Establishing lives for the purposes of depreciation and amortization of property, plant and equipment and intangibles
Long‑lived assets, consisting primarily of property, plant and equipment, customer intangibles and technology intangibles, comprise a significant portion of the total assets. The annual depreciation and amortization charges depend primarily on the estimated lives of each type of asset and, in certain circumstances, estimates of fair values and residual values. The board of directors regularly review these asset lives and change them as necessary to reflect current thinking on remaining lives in light of technological change, prospective economic utilization and physical condition of the assets concerned. Changes in asset lives can have a significant impact on the depreciation and amortization charges for the period. It is not practical to quantify the impact of changes in asset lives on an overall basis, as asset lives are individually determined and there are a significant number of asset lives in use. Details of the useful lives are included in the accounting policy. The impact of any change would vary significantly depending on the individual changes in assets and the classes of assets impacted.
Impairment tests for items of property, plant and equipment are performed on a CGU level basis. The recoverable amounts in property, plant and equipment are determined based on the higher of value‑in‑use or fair value less costs to sell.
Exceptional items
The Group’s consolidated income statement, cash flow and segmental analysis separately identify results before specific items. Specific items are those that in management’s judgment need to be disclosed by virtue of their size, nature or incidence to provide additional information. Such items include, where significant, restructuring, redundancy and other costs relating to permanent capacity realignment or footprint reorganization, directly attributable acquisition costs and acquisition integration costs, and other transaction-related costs, profit or loss on disposal or termination of operations, start‑up costs incurred in relation to and associated with plant builds, significant new line investments or furnaces, major litigation costs and settlements and impairments of non‑current assets. In this regard the determination of “significant” as included in our definition uses qualitative and quantitative factors. Judgment is used by the Group in assessing the particular items, which by virtue of their scale and nature, are disclosed in the Group’s consolidated income statement, and related notes as exceptional items. Management considers columnar presentation to be appropriate in the consolidated income statement as it provides useful additional information and is consistent with the way that financial performance is measured by management and presented to the Board. Exceptional restructuring costs are classified as restructuring provisions and all other exceptional costs when outstanding at the balance sheet date are classified as exceptional items payable.
Revenue recognition
Revenue is recognized when control of a good or service has transferred to the customer. For certain contracts, the Group manufactures products for customers that have no alternative use and for which the Group has an enforceable right to payment for production completed to date. The determination of goods or contracts having no alternative use and
Ardagh Group S.A.
51
the enforceable right to payment involves and relies upon management judgment, and can result in the Group accelerating the recognition of revenue over time as the Group satisfies the contractual performance obligations for those contracts.
Leased assets
At the lease commencement date the Group recognizes a lease liability as the present value of expected future lease payments, excluding any amounts which are variable based on the usage of the underlying asset and a right-of-use asset generally at the same amount plus any directly attributable costs. The Group combines lease and non-lease components and accounts for them as a single lease component. Several lease agreements include renewal and termination options. The Group assesses all facts and circumstances that create an economic incentive to exercise a renewal option, or not exercise a termination option. Renewal options (or periods after termination options) are only included in the lease term if the conclusion is that the lease is reasonably certain to be renewed (or not terminated). The lease term is reassessed if an option is actually exercised (or not exercised) or the Group becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the Group.
Recent accounting pronouncements
The impact of new standards, amendments to existing standards and interpretations issued and effective for annual periods beginning on or after January 1, 2019, have been assessed by the board of directors and, with the exception of those identified in Note 2 of the Audited Consolidated Financial Statements, no new standards or amendments to existing standards effective January 1, 2019, are currently relevant for the Group. The board of directors’ assessment of the impact of new standards, which are not yet effective and which have not been early adopted by the Group, on the consolidated financial statements and disclosures is on-going.
|
A. |
|
Operating results |
Year Ended December 31, 2019 compared to Year Ended December 31, 2018
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2019 |
|
2018 |
|
|
(in $ millions) |
||
Revenue |
|
6,660 |
|
6,676 |
Cost of sales |
|
(5,597) |
|
(5,731) |
Gross profit |
|
1,063 |
|
945 |
Sales, general and administration expenses |
|
(362) |
|
(317) |
Intangible amortization and impairment |
|
(233) |
|
(423) |
Operating profit |
|
468 |
|
205 |
Net finance expense |
|
(659) |
|
(479) |
Share of post-tax loss in equity accounted joint venture |
|
(49) |
|
— |
Loss before tax |
|
(240) |
|
(274) |
Income tax charge |
|
(44) |
|
(18) |
Loss from continuing operations |
|
(284) |
|
(292) |
Profit from discontinued operation |
|
1,742 |
|
198 |
Profit/(loss) for the year |
|
1,458 |
|
(94) |
Revenue
Revenue in the year ended December 31, 2019 decreased by $16 million to $6,660 million, compared with $6,676 million in the year ended December 31, 2018. The decrease in revenue principally reflected unfavorable foreign currency
Ardagh Group S.A.
52
translation effects of $173 million, partly offset by favorable volume/mix effects of $149 million and the pass through to customers of higher input costs in selling prices.
Cost of sales
Cost of sales in the year ended December 31, 2019 decreased by $134 million, or 2%, to $5,597 million, compared with $5,731 million in the year ended December 31, 2018. The decrease in cost of sales is due mainly to favorable currency translation effects and higher input and other operating costs, partly offset by lower exceptional cost of sales, inclusive of a $37 million pension service credit in Glass Packaging North America. Exceptional cost of sales decreased by $106 million, reflecting lower restructuring, capacity realignment and start-up related charges. Further analysis of the movement in exceptional items is set out in the “Supplemental Management’s Discussion and Analysis” section.
Gross profit
Gross profit in the year ended December 31, 2019 increased by $118 million, or 12%, to $1,063 million, compared with $945 million in the year ended December 31, 2018. Gross profit percentage in the year ended December 31, 2019 increased by 180 basis points to 16%, compared with 14.2% in the year ended December 31, 2018. Excluding exceptional cost of sales, gross profit percentage in the year ended December 31, 2019 increased by 20 basis points to 16.0%, compared with 15.8% in the year ended December 31, 2018.
Sales, general and administration expenses
Sales, general and administration expenses in the year ended December 31, 2019 increased by $45 million, or 14%, to $362 million, compared with $317 million in the year ended December 31, 2018. The increase primarily related to higher exceptional transaction-related costs. Excluding exceptional items, sales, general and administration expenses increased by $11 million, or 4%, mainly due to higher operating costs. Further analysis of the movement in exceptional items is set out in the “Supplemental Management’s Discussion and Analysis” section.
Intangible amortization and impairment
Intangible amortization and impairment in the year ended December 31, 2019 decreased by $190 million, to $233 million, compared with $423 million in the year ended December 31, 2018. The decrease was mainly due to a $186 million impairment charge to goodwill in Glass Packaging North America in 2018.
Operating profit
Operating profit in the year ended December 31, 2019 increased by $263 million, or 128%, to $468 million compared with $205 million in the year ended December 31, 2018. The increase in operating profit primarily reflected higher gross profit, and the impact of the impairment charge to goodwill in 2018 as outlined above, partly offset by the higher sales, general and administration expenses.
Ardagh Group S.A.
53
Net finance expense
Net finance expense in the year ended December 31, 2019 increased by $180 million, or 38%, to $659 million, compared with $479 million in the year ended December 31, 2018. Net finance expense for the year ended December 31, 2019 and 2018 comprised of the following:
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2019 |
|
2018 |
|
|
(in $ millions) |
||
Interest expense |
|
407 |
|
443 |
Net pension interest cost |
|
18 |
|
16 |
Loss/(gain)on derivative financial instruments |
|
9 |
|
(10) |
Foreign currency translation losses |
|
27 |
|
8 |
Other finance income |
|
(5) |
|
— |
Finance expense before exceptional items |
|
456 |
|
457 |
Exceptional finance expense |
|
203 |
|
22 |
Net finance expense from continuing operations |
|
659 |
|
479 |
Interest expense in the year ended December 31, 2019 decreased by $36 million, or 8%, to $407 million, compared with $443 million in the year ended December 31, 2018. The decrease was mainly due to the favorable impact of refinancing activity and debt redemptions in 2019. Further analysis of the Group’s refinancing activity is set out in the “Supplemental Management Discussion and Analysis” section. Derivative financial instruments in the year ended December 31, 2019 reflected a loss of $9 million, compared to a gain of $10 million in the year ended December 31, 2018 which related to the Group’s CCIRS.
Foreign currency translation losses in the year ended December 31, 2019 increased by $19 million to $27 million, compared with a loss of $8 million in the year ended December 31, 2018.
Exceptional finance expense of $203 million for the year ended December 31, 2019 primarily relates to $200 million in costs associated with debt redemption and refinancing activity in August 2019 and November 2019, principally comprising premium payable on the early redemption of the notes of $165 million, accelerated amortization of deferred finance costs, interest charges from the call date to date of redemption and a charge related to the termination of derivative financial instruments. Exceptional finance expense was $22 million for the year ended December 31, 2018 and mainly comprised $10 million in costs relating to the redemption in July 2018 of the Group’s $440 million 6.000% Senior Notes due 2021 and $6 million relating to the loss on the termination of the related $440 million U.S. dollar to euro CCIRS.
Share of post–tax loss in equity accounted joint venture
The Group recognized a $49 million share of post-tax loss in its equity accounted joint venture, relating to its approximate 42% investment in Trivium.
Income tax charge
Income tax charge in the year ended December 31, 2019 resulted in a tax charge of $44 million, compared with a tax charge of $18 million in the year ended December 31, 2018. The increase in income tax charge is primarily attributable to an increase of $32 million in the tax charge on tax losses for which no deferred income tax was recognized (relating to tax losses incurred in Ireland in respect of exceptional finance expense, in addition to the carry-forward of interest expense in certain jurisdictions), in addition to a decrease in the loss before tax of $34 million (tax effect of $11 million at the standard rate of Luxembourg corporation tax), an increase of $2 million in tax charge in respect of prior years, and an increase of $2 million in the tax charge relating to income taxed at rates other than the standard rate of Luxembourg corporation tax. These increases were partially offset by a decrease of $10 million in other tax items, a
Ardagh Group S.A.
54
reduction of $7 million in the tax effect of non-deductible items, an increase of $3 million in the tax credit on the re-measurement of deferred taxes and a decrease of $1 million in income subject to state and other local income taxes.
The effective income tax rate for the year ended December 31, 2019 was (18%) compared to an effective income tax rate for the year ended December 31, 2018 of (7%). The effective income tax rate is a function of the profit or loss before tax and the tax charge or credit for the year. The primary drivers impacting the effective tax rate are tax losses for which no deferred income tax was recognized.
Loss from continuing operations
As a result of the items described above, the loss for the year ended December 31, 2019 decreased by $8 million to $284 million, compared with a loss of $292 million in the year ended December 31, 2018.
Profit from discontinued operation
Profit from discontinued operation in the year ended December 31, 2019 increased by $1,544 million to $1,742 million, compared with $198 million in the year ended December 31, 2018. The increase primarily reflects the gain recognized on the disposal of the Food & Specialty Metal Packaging business.
Year Ended December 31, 2018 compared to Year Ended December 31, 2017
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2018 |
|
2017 |
|
|
(in $ millions) |
||
Revenue |
|
6,676 |
|
6,390 |
Cost of sales |
|
(5,731) |
|
(5,387) |
Gross profit |
|
945 |
|
1,003 |
Sales, general and administration expenses |
|
(317) |
|
(331) |
Intangible amortization |
|
(423) |
|
(237) |
Operating profit |
|
205 |
|
435 |
Net finance expense |
|
(479) |
|
(638) |
Loss before tax |
|
(274) |
|
(203) |
Income tax (charge)/credit |
|
(18) |
|
77 |
Loss from continuing operations |
|
(292) |
|
(126) |
Profit from discontinued operation |
|
198 |
|
189 |
(Loss)/profit for the year |
|
(94) |
|
63 |
Revenue
Revenue in the year ended December 31, 2018 increased by $286 million, or 4%, to $6,676 million, compared with $6,390 million in the year ended December 31, 2017. The increase in revenue principally reflected favorable foreign currency translation effects of $140 million, the pass through to customers of higher input costs in selling price and favorable volume/mix effects of $40 million.
Cost of sales
Cost of sales in the year ended December 31, 2018 increased by $344 million, or 6%, to $5,731 million, compared with $5,387 million in the year ended December 31, 2017. The increase in cost of sales is due mainly to unfavorable currency translation effects, higher input and other operating costs and higher exceptional cost of sales. Exceptional cost of sales increased by $30 million, reflecting higher restructuring, capacity realignment and start-up related charges. Further
Ardagh Group S.A.
55
analysis of the movement in exceptional items is set out in the “Supplemental Management’s Discussion and Analysis” section.
Gross profit
Gross profit in the year ended December 31, 2018 decreased by $58 million, or 6%, to $945 million, compared with $1,003 million in the year ended December 31, 2017. Gross profit percentage in the year ended December 31, 2018 decreased by 150 basis points to 14.2%, compared with 15.7% in the year ended December 31, 2017. Excluding exceptional cost of sales, gross profit percentage in the year ended December 31, 2018 decreased by 110 basis points to 15.8%, compared with 16.9% in the year ended December 31, 2017 mainly due to higher operating costs and the dilutive effect of the pass through to customers of higher input costs outlined above.
Sales, general and administration expenses
Sales, general and administration expenses in the year ended December 31, 2018 decreased by $14 million, or 4%, to $317 million, compared with $331 million in the year ended December 31, 2017. The decrease primarily related to lower exceptional transaction-related costs. Excluding exceptional items, sales, general and administration expenses increased by $14 million, or 5%, mainly due to unfavorable foreign currency translation effects. Further analysis of the movement in exceptional items is set out in the “Supplemental Management’s Discussion and Analysis” section.
Intangible amortization and impairment
Intangible amortization and impairment in the year ended December 31, 2018 increased by $186 million, to $423 million, compared with $237 million in the year ended December 31, 2017. The increase was mainly due to a $186 million impairment charge to goodwill in Glass Packaging North America in 2018.
Operating profit
Operating profit in the year ended December 31, 2018 decreased by $230 million, or 53%, to $205 million compared with $435 million in the year ended December 31, 2017. The decrease in operating profit primarily reflected the impairment charge to goodwill in Glass Packaging North America in 2018, and the lower gross profit, partly offset by lower sales, general, and administrative expenses as described above.
Net finance expense
Net finance expense in the year ended December 31, 2018 decreased by $159 million, or 25%, to $479 million, compared with $638 million in the year ended December 31, 2017. Net finance expense for the year ended December 31, 2018 and 2017 comprised the following:
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2018 |
|
2017 |
|
|
(in $ millions) |
||
Interest expense |
|
443 |
|
441 |
Net pension interest cost |
|
16 |
|
18 |
(Gain)/loss on derivative financial instruments |
|
(10) |
|
27 |
Foreign currency translation losses |
|
8 |
|
21 |
Other finance income |
|
— |
|
(1) |
Finance expense before exceptional items |
|
457 |
|
506 |
Exceptional finance expense |
|
22 |
|
132 |
Net finance expense from continuing operations |
|
479 |
|
638 |
Ardagh Group S.A.
56
Interest expense in the year ended December 31, 2018 of $443 million, was broadly in line with the $441 million in the year ended December 31, 2017. Derivative financial instruments in the year ended December 31, 2018 reflected a gain of $10 million, compared to a loss of $27 million in the year ended December 31, 2017 which primarily related to the Group’s CCIRS.
Foreign currency translation losses in the year ended December 31, 2018 decreased by $13 million to a loss of $8 million, compared with a loss of $21 million in the year ended December 31, 2017.
Exceptional finance expense was $22 million for the year ended December 31, 2018 and mainly comprised $10 million in costs relating to the redemption in July 2018 of the Group’s $440 million 6.000% Senior Notes due 2021 and $6 million relating to the loss on the termination of the related $440 million U.S. dollar to euro CCIRS. Exceptional finance expense for the year ended December 31, 2017 of $132 million related to costs associated with the debt refinancing and redemption activity in 2017, principally comprising early redemption premiums, accelerated amortization of deferred financing costs and issue discounts, as well as a loss of $15 million on the termination of certain of the Group’s CCIRS.
Income tax charge/(credit)
Income tax charge in the year ended December 31, 2018 resulted in a tax charge of $18 million, compared with a tax credit of $77 million in the year ended December 31, 2017. The increase in income tax charge is primarily attributable to a decrease in the tax credit on the re-measurement of deferred taxes of $70 million (a tax credit of $71 million was recognized in the year ended December 31, 2017 on the enactment of the Tax Cuts and Jobs Act of 2017 (“TCJA”) in the United States, partly offset by a tax charge of $2 million attributable to the progressive reduction in the French corporate income tax rate, which will apply when the existing temporary differences reverse, from 28% to 25%), in addition to an increase of $13 million in the tax effect of non-deductible items (primarily relating to a partially non-deductible impairment charge in the year ended December 31, 2018), an increase of $11 million in the tax charge relating to income taxed at rates other than the standard rate of Luxembourg corporation tax, an increase of $10 million in other tax items and an increase of $7 million in tax charge in respect of prior years. These increases were partly offset by an increase in the loss before tax of $71 million (tax effect of $16 million at the standard rate of Luxembourg corporation tax).
The effective income tax rate for the year ended December 31, 2018 was (7%) compared to an effective income tax rate for the year ended December 31, 2017 of 38%. The effective income tax rate is a function of the profit or loss before tax and the tax charge or credit for the year. The primary drivers impacting the effective tax rate are the tax credit arising on the enactment of the TCJA in the year ended December 31, 2017.
Loss from continuing operations
As a result of the items described above, the loss for the year ended December 31, 2018 increased by $166 million to $292 million, compared with a loss of $126 million in the year ended December 31, 2017.
Profit from discontinued operation
Profit from discontinued operation in the year ended December 31, 2018 increased by $9 million, or 5% to $198 million, compared with $189 million in the year ended December 31, 2017.
Supplemental Management’s Discussion and Analysis
Key Operating Measures
Adjusted EBITDA consists of profit/(loss) for the year before income tax charge/(credit), net finance expense, depreciation and amortization, exceptional operating items and share of profit or loss in equity accounted joint venture. We use Adjusted EBITDA to evaluate and assess our segment performance. Adjusted EBITDA is presented because we believe that it is frequently used by securities analysts, investors and other interested parties in evaluating companies in
Ardagh Group S.A.
57
the packaging industry. However, other companies may calculate Adjusted EBITDA in a manner different from ours. Adjusted EBITDA is not a measure of financial performance under IFRS and should not be considered an alternative to profit/(loss) as indicators of operating performance or any other measures of performance derived in accordance with IFRS.
For a reconciliation of the profit/(loss) for the year to Adjusted EBITDA see footnote 6 to the Summary Consolidated Financial and Other Data of Ardagh Group S.A., in Item 3A.
Adjusted EBITDA in continuing operations in the year ended December 31, 2019 increased by $58 million, or 5%, to $1,173 million, compared with $1,115 million in the year ended December 31, 2018. Adjusted EBITDA in the discontinued operation in the year ended December 31, 2019 decreased by $37 million, or 10%, to $326 million, compared with $363 million in the year ended December 31, 2018 primarily driven by the discontinued operation adjusted EBITDA in 2019 reflecting ten months result following the disposal of the Food & Specialty Metal Packaging business on October 31, 2019.
Adjusted EBITDA in continuing operations in the year ended December 31, 2018 decreased by $26 million, or 2%, to $1,115 million, compared with $1,141 million in the year ended December 31, 2017. Adjusted EBITDA in the discontinued operation in the year ended December 31, 2018 decreased by $4 million, or 1%, to $363 million, compared with $367 million in the year ended December 31, 2017.
Exceptional Items
The following table provides detail on exceptional items from continuing operations included in cost of sales, sales, general and administration expenses, finance expense and finance income:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Legal matter |
|
15 |
|
— |
|
— |
Start-up related costs |
|
13 |
|
48 |
|
8 |
Restructuring and other costs |
|
6 |
|
50 |
|
32 |
Impairment - property, plant and equipment |
|
5 |
|
5 |
|
38 |
Past service (credit)/charge |
|
(37) |
|
5 |
|
— |
Exceptional items - cost of sales |
|
2 |
|
108 |
|
78 |
Transaction-related costs |
|
51 |
|
17 |
|
45 |
Exceptional items - SGA expenses |
|
51 |
|
17 |
|
45 |
Impairment - goodwill |
|
— |
|
186 |
|
— |
Exceptional items - impairment of intangible assets |
|
— |
|
186 |
|
— |
Debt refinancing and settlement costs |
|
200 |
|
16 |
|
117 |
Loss on derivative financial instruments |
|
3 |
|
6 |
|
15 |
Exceptional items - finance expense |
|
203 |
|
22 |
|
132 |
Share of exceptional items in material joint venture |
|
39 |
|
— |
|
— |
Exceptional items from continuing operations |
|
295 |
|
333 |
|
255 |
Exceptional income tax charge/(credit) |
|
3 |
|
(49) |
|
(124) |
Exceptional items from continuing operations, net of tax |
|
298 |
|
284 |
|
131 |
Exceptional items from discontinued operation, net of tax |
|
(1,527) |
|
13 |
|
12 |
Total exceptional (credit)/charge, net of tax |
|
(1,229) |
|
297 |
|
143 |
Ardagh Group S.A.
58
Exceptional items are those that in management’s judgment need to be disclosed by virtue of their size, nature or incidence.
2019
Exceptional items of $1,229 million have been recognized for the year ending December 31, 2019, primarily comprising:
|
· |
|
$15 million related to a legal matter as described in Note 28 of the consolidated financial statements. |
|
· |
|
$24 million related to the Group’s capacity realignment programs, including start-up related costs ($13 million), restructuring costs ($6 million), property, plant and equipment impairment charges ($5 million). These costs were incurred in Glass Packaging North America ($15 million), Glass Packaging Europe ($5 million), Metal Beverage Packaging America ($2 million) and Metal Beverage Packaging Europe ($2 million). |
|
· |
|
$37 million pension service credit recognized in Glass Packaging North America following amendments to a pension scheme. |
|
· |
|
$51 million transaction-related costs, primarily comprising costs relating to the combination of the Group’s Food & Specialty Metal Packaging business with the business of Exal Corporation to form Trivium. |
|
· |
|
$200 million debt refinancing and settlement costs related to the redemption of notes in August and November 2019 as described in Note 20 of the consolidated financial statements, and includes premium payable on the early redemption of the notes of $165 million, accelerated amortization of deferred finance costs, interest charges from the call date to date of redemption and $3 million exceptional loss on the termination of derivative financial instruments. |
|
· |
|
$39 million from the share of exceptional items in the Trivium joint venture. |
|
· |
|
$3 million from tax charge as described in Note 6 of the consolidated financial statements. |
|
· |
|
$1,527 million from discontinued operation, net of tax, primarily related to the gain, net of directly attributable disposal costs, on the disposal of the Food & Specialty Metal Packaging business. |
2018
Exceptional items of $297 million have been recognized for the year ending December 31, 2018, primarily comprising:
|
· |
|
$103 million related to the Group’s capacity realignment programs, including start-up related costs ($48 million) restructuring costs ($50 million), property, plant and equipment impairment charges ($5 million). These costs were incurred in Glass Packaging North America ($78 million), Metal Beverage Packaging Europe ($24 million), Glass Packaging Europe ($5 million) and a credit in Metal Beverage Packaging Americas ($4 million). |
|
· |
|
$5 million pension service cost recognized in Metal Beverage Packaging Europe and Glass Packaging Europe following a High Court ruling in the U.K. in October 2018 in respect of GMP equalization (Note 21 to the consolidated financial statements included elsewhere in this annual report). |
|
· |
|
$17 million transaction-related costs, primarily comprised of costs relating to acquisition, integration and other transactions. |
|
· |
|
$186 million impairment of goodwill in Glass Packaging North America. |
Ardagh Group S.A.
59
|
· |
|
$16 million debt refinancing and settlement costs primarily relating to the redemption of the Group’s $440 million 6.000% Senior Notes due 2021 in July 2018, principally comprising an early redemption premium and accelerated amortization of deferred finance costs. |
|
· |
|
$6 million exceptional loss on the termination of the Group’s $440 million U.S. dollar to euro CCIRS in July 2018. |
|
· |
|
$49 million from tax credits, as described in Note 6 of the consolidated financial statements. |
|
· |
|
$13 million related to exceptional items from discontinued operation, net of tax. |
2017
Exceptional items of $143 million have been recognized for the year ending December 31, 2017, primarily comprising:
|
· |
|
$78 million related to the Group’s capacity realignment programs, including restructuring costs ($32 million), start-up related costs ($8 million) and property, plant and equipment impairment charges ($38 million). These costs were incurred in Glass Packaging North America ($43 million), Metal Beverage Packaging Europe ($33 million) and Metal Beverage Packaging Americas ($2 million). |
|
· |
|
$45 million transaction related costs, primarily comprised of costs directly attributable to the Beverage Can Acquisition and integration of that business and other IPO and transaction-related costs. |
|
· |
|
$117 million debt refinancing and settlement costs relating to the notes and loans redeemed and repaid in January, March, April, June, and August 2017, principally comprising premiums payable on the early redemption of the notes and accelerated amortization of deferred finance costs and issue discounts. |
|
· |
|
$15 million exceptional loss on the termination in June 2017, of $500 million of the Group’s U.S. dollar to British pound CCIRS, of which $12 million relates to cumulative losses recycled from other comprehensive income. |
|
· |
|
$124 million from tax credits, as described in Note 6 of the consolidated financial statements. |
|
· |
|
$12 million related to exceptional items from discontinued operation, net of tax. |
Ardagh Group S.A.
60
Segment Information
Year Ended December 31, 2019 compared to Year Ended December 31, 2018
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2019 |
|
2018 |
|
|
(in $ millions) |
||
Revenue |
|
|
|
|
Metal Beverage Packaging Europe |
|
1,556 |
|
1,616 |
Metal Beverage Packaging Americas |
|
1,816 |
|
1,742 |
Glass Packaging Europe |
|
1,613 |
|
1,623 |
Glass Packaging North America |
|
1,675 |
|
1,695 |
Continuing operations |
|
6,660 |
|
6,676 |
Discontinued operation |
|
2,003 |
|
2,421 |
Total Revenue |
|
8,663 |
|
9,097 |
Adjusted EBITDA |
|
|
|
|
Metal Beverage Packaging Europe |
|
253 |
|
270 |
Metal Beverage Packaging Americas |
|
250 |
|
230 |
Glass Packaging Europe |
|
391 |
|
358 |
Glass Packaging North America |
|
279 |
|
257 |
Continuing operations |
|
1,173 |
|
1,115 |
Discontinued operation |
|
326 |
|
363 |
Adjusted EBITDA |
|
1,499 |
|
1,478 |
Revenue – continuing operations
Metal Beverage Packaging Europe. Revenue decreased by $60 million, or 4%, to $1,556 million in the year ended December 31, 2019, compared with $1,616 million in the year ended December 31, 2018. The decrease in revenue principally reflects unfavorable foreign currency translation effects of $86 million and lower selling prices, partly offset by favorable volume/mix effects of 4%.
Metal Beverage Packaging Americas. Revenue increased by $74 million, or 4%, to $1,816 million in the year ended December 31, 2019, compared with $1,742 million in the year ended December 31, 2018. Revenue growth reflected favorable volume/mix effects of 9%, partly offset by the pass through of lower input costs.
Glass Packaging Europe. Revenue decreased by $10 million, or 1%, to $1,613 million in the year ended December 31, 2019, compared with $1,623 million in the year ended December 31, 2018. The decrease in revenue principally reflected unfavorable foreign currency translation effects of $87 million, partly offset by increased selling prices.
Glass Packaging North America. Revenue decreased by $20 million, or 1%, to $1,675 million in the year ended December 31, 2019, compared with $1,695 million in the year ended December 31, 2018. The decrease in revenue was mainly attributed to unfavorable volume/mix effects of 3%, partly offset by the pass through of higher input costs (see Item 5. Operating and Financial Review and Prospects—Business Drivers).
Revenue – discontinued operation
Discontinued Operation. Revenue decreased by $418 million, or 17%, to $2,003 million in the year ended December 31, 2019, compared with $2,421 million in the year ended December 31, 2018. The reduction in revenue is primarily as a result of the Group’s disposal of its Food & Specialty Metal Packaging business on October 31, 2019. As
Ardagh Group S.A.
61
such, the revenues presented for the year ended December 31, 2019 represent the results from operations for ten months, compared to twelve months revenue for the year ended December 31, 2018.
Adjusted EBITDA – continuing operations
Metal Beverage Packaging Europe. Adjusted EBITDA decreased by $17 million, or 6%, to $253 million in the year ended December 31, 2019, compared with $270 million in the year ended December 31, 2018. The decrease in Adjusted EBITDA reflected unfavorable foreign currency translation effects of $13 million and lower selling prices, partly offset by the impact of IFRS 16 of $14 million, favorable volume/mix effects and the achievement of operating and other cost savings including a one-time pension credit of approximately $15 million.
Metal Beverage Packaging Americas. Adjusted EBITDA increased by $20 million, or 9%, to $250 million in the year ended December 31, 2019, compared with $230 million in the year ended December 31, 2018. Adjusted EBITDA growth principally reflected favorable volume/mix effects and the impact of IFRS 16 of $9 million, partly offset by higher operating and other costs.
Glass Packaging Europe. Adjusted EBITDA increased by $33 million, or 9%, to $391 million in the year ended December 31, 2019, compared with $358 million in the year ended December 31, 2018. Adjusted EBITDA growth mainly reflected higher selling prices to recover increased input costs, the impact of IFRS 16 of $24 million and favorable volume/mix effects, partly offset by unfavorable currency translation effects of $19 million and higher operating costs.
Glass Packaging North America. Adjusted EBITDA increased by $22 million, or 9%, to $279 million in the year ended December 31, 2019, compared with $257 million in the year ended December 31, 2018. The increase in Adjusted EBITDA is driven by increased selling prices and the impact of IFRS 16 of $36 million, partly offset by unfavorable volume/mix effects and higher operating costs.
Adjusted EBITDA – discontinued operation
Discontinued Operation. Adjusted EBITDA decreased by $37 million, or 10%, to $326 million in the the year ended December 31, 2019, compared with $363 million in the the year ended December 31, 2018. The decrease is primarily as a result of the disposal of the Food & Specialty Metal Packaging business on October 31, 2019, as outlined above.
Ardagh Group S.A.
62
Year Ended December 31, 2018 compared to Year Ended December 31, 2017
|
|
|
|
|
|
|
Year ended |
||
|
|
December 31, |
||
|
|
2018 |
|
2017 |
|
|
(in $ millions) |
||
Revenue |
|
|
|
|
Metal Beverage Packaging Europe |
|
1,616 |
|
1,535 |
Metal Beverage Packaging Americas |
|
1,742 |
|
1,529 |
Glass Packaging Europe |
|
1,623 |
|
1,549 |
Glass Packaging North America |
|
1,695 |
|
1,777 |
Continuing operations |
|
6,676 |
|
6,390 |
Discontinued operation |
|
2,421 |
|
2,206 |
Total Revenue |
|
9,097 |
|
8,596 |
Adjusted EBITDA |
|
|
|
|
Metal Beverage Packaging Europe |
|
270 |
|
257 |
Metal Beverage Packaging Americas |
|
230 |
|
195 |
Glass Packaging Europe |
|
358 |
|
340 |
Glass Packaging North America |
|
257 |
|
349 |
Continuing operations |
|
1,115 |
|
1,141 |
Discontinued operation |
|
363 |
|
367 |
Total Adjusted EBITDA |
|
1,478 |
|
1,508 |
Revenue – continuing operations
Metal Beverage Packaging Europe. Revenue increased by $81 million, or 5%, to $1,616 million in the year ended December 31, 2018, compared with $1,535 million in the year ended December 31, 2017. Revenue growth principally reflected favorable foreign currency translation effects of $77 million and favorable volume/mix effects.
Metal Beverage Packaging Americas. Revenue increased by $213 million, or 14% to $1,742 million in the year ended December 31, 2018, compared with $1,529 million in the year ended December 31, 2017. Revenue growth reflected favorable volume/mix effects of 11% and the pass through of higher input costs.
Glass Packaging Europe. Revenue increased by $74 million, or 5%, to $1,623 million in the year ended December 31, 2018, compared with $1,549 million in the year ended December 31, 2017. Revenue growth principally reflected favorable foreign currency translation effects of $63 million, the pass through of higher input costs and favorable volume/mix effects in Glass packaging, partly offset by lower activity in Glass Engineering.
Glass Packaging North America. Revenue decreased by $82 million or 5% to $1,695 million in the year ended December 31, 2018, compared with $1,777 million in the year ended December 31, 2017. The decrease in revenue was mainly attributed to unfavorable volume/mix effects, partly offset by the pass through of higher input costs (see Item 5. Operating and Financial Review and Prospects—Business Drivers).
Revenue – discontinued operation
Discontinued Operation. Revenue increased by $215 million, or 10%, to $2,421 million in the year ended December 31, 2018, compared with $2,206 million in the year ended December 31, 2017. The increase in revenue was primarily due to the pass through to customers of higher input costs, favorable foreign currency translation effects of $80 million and favorable volume/mix effects.
Ardagh Group S.A.
63
Adjusted EBITDA – continuing operations
Metal Beverage Packaging Europe. Adjusted EBITDA increased by $13 million, or 5%, to $270 million in the year ended December 31, 2018, compared with $257 million in the year ended December 31, 2017. Adjusted EBITDA growth primarily reflected favorable foreign currency translation effects of $11 million, partly offset by higher input costs.
Metal Beverage Packaging Americas. Adjusted EBITDA increased by $35 million, or 18%, to $230 million in the year ended December 31, 2018, compared with $195 million in the year ended December 31, 2017. Adjusted EBITDA growth primarily reflected favorable volume/mix effects and the achievement of production efficiencies and other cost savings, partly offset by higher input costs.
Glass Packaging Europe. Adjusted EBITDA increased by $18 million, or 5%, to $358 million in the year ended December 31, 2018, compared with $340 million in the year ended December 31, 2017. Adjusted EBITDA growth mainly reflected favorable foreign currency translation effects of $11 million, operating and other cost savings and favorable volume/mix effects in Glass packaging, partly offset by lower activity in Glass Engineering.
Glass Packaging North America. Adjusted EBITDA decreased by $92 million or 26% to $257 million in the year ended December 31, 2018, compared with $349 million in the year ended December 31, 2017. The decline in Adjusted EBITDA principally reflected unfavorable volume/mix effects, higher freight and logistics costs and the costs of planned production downtime.
Adjusted EBITDA – discontinued operation
Discontinued Operation. Adjusted EBITDA decreased by $4 million, or 1%, to $363 million in the year ended December 31, 2018, compared with $367 million in the year ended December 31, 2017. The decrease in Adjusted EBITDA was primarily due to higher input costs, partly offset by lower other operating cost including $12 million relating to a lower pension related expense and favorable currency translation effects of $13 million.
Cash Requirements Related to Operations
Our principal sources of cash are cash generated from operations and external financings, including borrowings and other credit facilities. Our principal funding arrangements include borrowings available under the Group’s Global Asset Based Loan Facility. These and other sources of external financing are described further in the following table. Our principal credit agreements and indentures are also filed as exhibits to the Group’s latest annual report.
Both our metal beverage packaging and glass packaging divisions’ sales and cash flows are subject to seasonal fluctuations. Demand for our metal beverage and glass products is typically strongest during the summer months and in the period prior to December because of the seasonal nature of beverage consumption. The investment in working capital for metal beverage and glass packaging typically peaks in the first quarter. We manage the seasonality of our working capital by supplementing operating cash flows with drawings under our credit facilities.
Ardagh Group S.A.
64
The following table outlines our principal financing arrangements as of December 31, 2019.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum |
|
Final |
|
|
|
|
|
|
|
|
|
|
|
|
amount |
|
maturity |
|
Facility |
|
|
|
|
|
Undrawn |
Facility |
|
Currency |
|
drawable |
|
date |
|
type |
|
Amount drawn |
|
amount |
||
|
|
|
|
Local |
|
|
|
|
|
Local |
|
|
|
|
|
|
|
|
currency |
|
|
|
|
|
currency |
|
$'m |
|
$'m |
|
|
|
|
m |
|
|
|
|
|
m |
|
|
|
|
2.750% Senior Secured Notes |
|
EUR |
|
741 |
|
15-Mar-24 |
|
Bullet |
|
741 |
|
832 |
|
– |
4.250% Senior Secured Notes |
|
USD |
|
695 |
|
15-Sep-22 |
|
Bullet |
|
695 |
|
695 |
|
– |
2.125% Senior Secured Notes |
|
EUR |
|
439 |
|
15-Aug-26 |
|
Bullet |
|
439 |
|
493 |
|
– |
4.125% Senior Secured Notes |
|
USD |
|
500 |
|
15-Aug-26 |
|
Bullet |
|
500 |
|
500 |
|
– |
4.750% Senior Notes |
|
GBP |
|
400 |
|
15-Jul-27 |
|
Bullet |
|
400 |
|
528 |
|
– |
6.000% Senior Notes |
|
USD |
|
1,700 |
|
15-Feb-25 |
|
Bullet |
|
1,700 |
|
1,708 |
|
– |
5.250% Senior Notes |
|
USD |
|
800 |
|
15-Aug-27 |
|
Bullet |
|
800 |
|
800 |
|
– |
Global Asset Based Loan Facility |
|
USD |
|
663 |
|
07-Dec-22 |
|
Revolving |
|
– |
|
– |
|
663 |
Lease obligations |
|
Various |
|
– |
|
|
|
Amortizing |
|
– |
|
364 |
|
– |
Other borrowings/credit lines |
|
EUR/USD |
|
– |
|
Rolling |
|
Amortizing |
|
– |
|
22 |
|
1 |
Total borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
5,942 |
|
664 |
Deferred debt issue costs and bond premium |
|
|
|
|
|
|
|
|
|
|
|
(32) |
|
– |
Net borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
5,910 |
|
664 |
Cash and cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
(614) |
|
614 |
Derivative financial instruments used to hedge foreign currency and interest rate risk |
|
|
|
|
|
|
|
|
|
|
|
32 |
|
– |
Net debt / available liquidity |
|
|
|
|
|
|
|
|
|
|
|
5,328 |
|
1,278 |
Lease obligations of $364 million primarily reflect increases related to $349 million lease liabilities due to initial adoption of IFRS 16 as of January 1, 2019, as well as $169 million of new lease liabilities, partly offset by $84 million of lease liabilities divested at October 31, 2019, $78 million of principal repayments in continuing operations and $14 million of principal repayments in discontinued operation in the year ended December 31, 2019.
On August 12, 2019, the Group issued €440 million 2.125% Senior Secured Notes due 2026, $500 million 4.125% Senior Secured Notes due 2026, and $800 million 5.250% Senior Notes due 2027. The net proceeds from the issuance of these notes were used to redeem on August 13, 2019 the $1,650 million 7.250% Senior Notes due 2024 and to pay applicable redemption premiums and accrued interest in accordance with their terms.
Following the completion of the combination of its Food & Specialty business with the business of Exal, on October 31, 2019, the Group issued tender offers, at par, in respect of its $715 million 4.250% Senior Secured Notes due 2022, €750 million 2.750% Senior Secured Notes due 2024, €440 million 2.125% Senior Secured Notes due 2026 and $500 million 4.125% Senior Secured Notes due 2026. Following the expiration of the offer on November 28, 2019 notice was given to repurchase the following amounts, $19,655,000 of the $715 million 4.250% Senior Secured Notes due 2022, €9,303,000 of the €750 million 2.750% Senior Secured Notes due 2024, and €850,000 of the €440 million 2.125% Senior Secured Notes due 2026. On December 2, 2019, in accordance with the terms of the offer, the redemptions were completed.
On November 14, 2019, the Group redeemed $1,000 million 4.625% Senior Secured Notes due 2023 and €440 million 4.125% Senior Secured Notes due 2023, and paid the applicable redemption premiums and accrued interest in accordance with their terms.
On November 29, 2019, the Group redeemed €750 million 6.750% Senior Notes due 2024 and paid the applicable redemption premium and accrued interest.
As at December 31, 2019, the Group had $663 million available under the Global Asset Based Loan Facility.
Ardagh Group S.A.
65
The following table outlines the minimum repayments the Group is obliged to make in the twelve months ending December 31, 2019, assuming that the other credit lines will be renewed or replaced with similar facilities as they mature.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minimum net |
|
|
|
|
|
|
|
|
|
|
repayment for |
|
|
|
|
|
|
|
|
|
|
the twelve |
|
|
|
|
|
|
Final |
|
|
|
months ending |
|
|
|
|
Local |
|
Maturity |
|
Facility |
|
December 31, |
Facility |
|
Currency |
|
Currency |
|
Date |
|
Type |
|
2020 |
|
|
|
|
(in millions) |
|
|
|
|
|
(in $ millions) |
Lease obligations |
|
USD/GBP/EUR |
|
— |
|
|
|
Amortizing |
|
73 |
Other borrowings/credit lines |
|
EUR/USD |
|
— |
|
Rolling |
|
Amortizing |
|
22 |
|
|
|
|
|
|
|
|
|
|
95 |
The Group believes it has adequate liquidity to satisfy its cash needs for at least the next 12 months. In the year ended December 31, 2019, the continuing operations reported operating profit of $468 million, cash generated from operations of $1,179 million and generated Adjusted EBITDA of $1,173 million.
The Group generates substantial cash flow from our operations and had $614 million in cash and cash equivalents and restricted cash as of December 31, 2019, as well as available but undrawn liquidity of $664 million under its credit facilities. We believe that our cash balances and future cash flow from operating activities, as well as our credit facilities, will provide sufficient liquidity to fund our purchases of property, plant and equipment, interest payments on our notes and other credit facilities and dividend payments for at least the next 12 months. In addition, we believe that we will be able to fund certain additional investments from our current cash balances, credit facilities and cash flow from operating activities.
Accordingly, the Group believes that its long‑term liquidity needs primarily relate to the service of our debt obligations. We expect to satisfy our future long‑term liquidity needs through a combination of cash flow generated from operations and, where appropriate, to refinance our debt obligations in advance of their respective maturity dates as we have successfully done in the past.
Ardagh Group S.A.
66
Cash Flows
The following table sets forth certain information reflecting a summary of our cash flow activity for the three years ended December 31, 2019 set forth below:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
(in $ millions) |
||||
Operating profit |
|
468 |
|
205 |
|
435 |
Depreciation and amortization |
|
652 |
|
599 |
|
583 |
Exceptional operating items |
|
53 |
|
311 |
|
123 |
Movement in working capital(1) |
|
105 |
|
(9) |
|
116 |
Transaction-related, start-up and other exceptional costs paid |
|
(87) |
|
(92) |
|
(70) |
Exceptional restructuring paid |
|
(12) |
|
(23) |
|
(2) |
Cash generated from continuing operations |
|
1,179 |
|
991 |
|
1,185 |
Interest paid |
|
(417) |
|
(414) |
|
(458) |
Income tax paid |
|
(64) |
|
(97) |
|
(95) |
Net cash from operating activities - continuing operations |
|
698 |
|
480 |
|
632 |
Net cash from operating activities - discontinued operation(2) |
|
141 |
|
375 |
|
330 |
Net cash from operating activities |
|
839 |
|
855 |
|
962 |
|
|
|
|
|
|
|
Capital expenditure(3) |
|
(505) |
|
(467) |
|
(400) |
Investing cash flows from/(used in) continuing operations |
|
(505) |
|
(467) |
|
(400) |
Proceeds from disposal of discontinued operation, net of cash disposed of |
|
2,539 |
|
— |
|
— |
Investing cash flows from discontinued operation |
|
(107) |
|
(108) |
|
(92) |
Net cash from/(used in) investing activities |
|
1,927 |
|
(575) |
|
(492) |
|
|
|
|
|
|
|
Repayment of borrowings |
|
(4,088) |
|
(442) |
|
(4,384) |
Proceeds from borrowings |
|
1,806 |
|
110 |
|
3,730 |
Dividend paid |
|
(132) |
|
(132) |
|
(165) |
Consideration (paid)/received on extinguishment of derivative financial instruments |
|
9 |
|
(44) |
|
46 |
Deferred debt issued costs paid |
|
(14) |
|
(5) |
|
(38) |
Finance lease payments |
|
(78) |
|
(4) |
|
— |
Early redemption costs paid |
|
(165) |
|
(7) |
|
(91) |
Proceeds from share issuance |
|
— |
|
— |
|
326 |
Financing cash flows from continuing operations |
|
(2,662) |
|
(524) |
|
(576) |
Financing cash flows from discontinued operation |
|
— |
|
3 |
|
(1) |
Net outflow from financing activities |
|
(2,662) |
|
(521) |
|
(577) |
|
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents |
|
104 |
|
(241) |
|
(107) |
Exchange (losses)/gains on cash and cash equivalents |
|
(20) |
|
(13) |
|
78 |
Net increase/(decrease) in cash and cash equivalents after exchange (losses)/gains |
|
84 |
|
(254) |
|
(29) |
|
(1) |
|
Working capital is made up of inventories, trade and other receivables, contract assets, trade and other payables and current provisions. |
Ardagh Group S.A.
67
|
(3) |
|
Capital expenditure is the sum of purchase of property, plant and equipment and software and other intangibles, net of proceeds from disposal of property, plant and equipment. |
Net cash from operating activities – continuing operations
Net cash from operating activities increased by $218 million from $480 million in the year ended December 31, 2018, to $698 million in the year ended December 31, 2019. The increase was primarily due to an increase of $263 million in operating profit, increased working capital inflows of $114 million, an increase in depreciation and amortization of $53 million, a decrease in restructuring costs paid of $11 million and a decrease of $5 million in transaction-related, start-up and other exceptional costs paid, partly offset by an decrease in exceptional operating items of $258 million. Net cash from operating activities was further impacted by interest paid and tax paid of $417 million and $64 million, respectively.
Net cash from operating activities decreased by $152 million from $632 million in the year ended December 31, 2017, to $480 million in the year ended December 31, 2018. The decrease was primarily due to a decrease of $230 million in operating profit, lower working capital inflows of $125 million, an increase in restructuring costs paid of $21 million and an increase of $22 million in transaction-related, start-up and other exceptional costs paid, partly offset by an increase in depreciation and amortization of $16 million and an increase in exceptional operating items of $188 million. Net cash from operating activities was further impacted by interest paid and tax paid of $414 million and $97 million, respectively.
Net cash from operating activities – discontinued operation
Net cash from operating activities in the discontinued operation decreased by $234 million from $375 million in the year ended December 31, 2018, to $141 million in the year ended December 31, 2019. Net cash from operating activities in the discontinued operation increased by $45 million from $330 million in the year ended December 31, 2017, to $375 million in the year ended December 31, 2018.
Net cash used in investing activities – continuing operations
Net cash used in investing activities increased by $38 million to $505 million in the year ended December 31, 2019, compared with the same period in 2018 due to increased capital expenditure, reflecting capital investment initiatives, the timing of projects and furnace rebuilds. Capital expenditure for the year ended December 31, 2019 includes $75 million related to the Group’s short payback projects.
Net cash used in investing activities increased by $67 million to $467 million in the year ended December 31, 2018, compared with the same period in 2017, due to increased capital expenditure in all operating segments, reflecting capital investment initiatives, the timing of projects and furnace rebuilds. Capital expenditure for the year ended December 31, 2018 includes $49 million related to the Group’s short payback projects.
Net cash from/(used in) investing activities – discontinued operation
Net cash from investing activities, for the year ended December 31, 2019, includes $2,539 million relating to the proceeds from the disposal of the Food & Specialty Metal Packaging business, net of cash disposed of. Excluding these proceeds on disposal, net cash used in investing activities decreased by $1 million to $107 million compared to $108 million in the same period in 2018.
Net cash used in investing activities increased by $16 million to $108 million compared to $92 million in the same period in 2017 primarily due to increased capital expenditure on short payback projects of $16 million.
Ardagh Group S.A.
68
Net outflow from financing activities – continuing operations
In the year ended December 31, 2019, net cash from financing activities represented an outflow of $2,662 million compared with $524 million in the same period in 2018. Repayment of borrowings of $4,088 million mainly reflects the redemption of the $1,650 million 7.250% Senior Notes due 2024 in August 2019, the redemption in November of $1,000 million 4.625% Senior Secured Notes due 2023, €440 million 4.125% Senior Secured Notes due 2023 and €750 million 6.750% Senior Notes due 2024 and the redemption of approximately $31 million of Senior Secured debt as part of the Group’s par tender offer, as outlined above. Total associated early redemption premium paid was $165 million. Repayment of borrowings also includes $100 million related to the Group’s Global Asset Based Loan Facility. Proceeds from borrowings of $1,806 million principally reflects the issuance in August 2019 of $800 million 5.250% Senior Notes due 2027, $500 million 4.125% Senior Secured Notes due 2026 and €440 million 2.125% Senior Secured Notes due 2026. Deferred debt issue costs paid were $14 million, principally arising from the above financing activities.
Consideration received on the extinguishment of derivative financial instruments of $9 million reflects the net proceeds of $23 million received on settlement of a number of CCIRS in August 2019, partly offset by $14 million of amounts paid in settlement of the Group’s $200 million U.S. dollar to euro CCIRS in February 2019.
In the year ended December 31, 2019, the Company paid dividends to shareholders of $132 million.
Lease payments in the year ended December 31, 2019 were $78 million and reflected increased principal repayments following the adoption of IFRS 16, effective from January 1, 2019.
In the year ended December 31, 2018, net cash from financing activities represented an outflow of $524 million compared with $576 million in the same period in 2017. Repayment of borrowings of $442 million mainly reflects the redemption in July 2018 of the Group’s $440 million 6.000% Senior Notes due 2021. Total associated early redemption premium paid was $7 million. Proceeds from borrowings of $110 million principally reflect amounts drawn under the Group’s Global Asset Based Loan Facility.
Consideration paid on the termination of derivative financial instruments of $44 million reflects amounts paid in settlement of the Group’s $440 million U.S. dollar to euro CCIRS in July 2018.
In the year ended December 31, 2018, the Company paid dividends to shareholders of $132 million.
Debt issue costs paid and finance lease payments in the year ended December 31, 2018 for continuing operations were $5 million and $4 million, respectively.
Net inflow from financing activities – discontinued operation
Net cash from financing activities were $nil in the year ended December 31, 2019, compared with an inflow of $3 million in the same period in 2018. Net cash from financing activities represented an inflow of $3 million in the year ended December 31, 2018, compared with an outflow of $1 million in the same period in 2017.
Working capital
For the year ended December 31, 2019, the movement in working capital during the period increased by $114 million to an inflow of $105 million, compared to an outflow of $9 million in December 31, 2018. The increase in working capital was primarily due to favorable cashflows generated from trade and other payables and trade and other receivables, partly offset by unfavorable cashflows generated from inventories.
For the year ended December 31, 2018, the movement in working capital during the period decreased by $125 million to an outflow of $9 million, compared to an inflow of $116 million in December 31, 2017. The decrease in
Ardagh Group S.A.
69
working capital was primarily due to less favorable cashflows generated from inventories and trade and other payables and inventories, partly offset by lower trade and other receivables.
Exceptional operating costs paid
Transaction-related, start-up and other exceptional costs paid in the year ended December 31, 2019 decreased by $5 million to $87 million compared with $92 million in the year ended December 31, 2018. In the year ended December 31, 2019, amounts paid of $87 million primarily related to capacity realignment and start-up related costs paid in Glass Packaging North America, Metal Beverage Packaging Europe and Metal Beverage Packaging Americas, other transaction-related costs paid and settlement of the court award related to a legal matter noted in the Supplemental Management’s Discussion and Analysis. Exceptional restructuring costs paid in the year ended December 31, 2019 decreased by $11 million to $12 million compared with $23 million in the year ended December 31, 2018. The decrease is mainly driven by lower restructuring cost in Glass Packaging North America.
Transaction-related, start-up and other exceptional costs paid in the year ended December 31, 2018 increased by $22 million to $92 million compared with $70 million in the year ended December 31, 2017. In the year end ended December 31, 2018, amounts paid of $92 million primarily related to capacity realignment and start-up related costs paid in Glass Packaging North America, Metal Beverage Packaging Europe and Metal Beverage Packaging Americas and other transaction-related costs paid. In the year ended December 31, 2017, amounts paid of $70 million primarily related to the integration of the Beverage Can Business, start-up related costs in Metal Beverage Packaging Americas and other transaction-related costs paid.
Income tax paid during the year ended December 31, 2019 was $64 million, which represents a decrease of $33 million when compared to the year ended December 31, 2018. The decrease is primarily attributable to the timing of tax payments and refunds received in certain jurisdictions, in addition to the phasing of tax incentives in certain jurisdictions.
Income tax paid during the year ended December 31, 2018 was $97 million, which represents an increase of $2 million when compared to the year ended December 31, 2017. The increase is primarily attributable to the timing of tax payments and refunds received in certain jurisdictions.
Capital expenditure
|
|
|
|
|
|
|
|
|
Year ended |
||||
|
|
December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
(in $ millions) |
||||
Metal Beverage Packaging Europe |
|
95 |
|
103 |
|
95 |
Metal Beverage Packaging Americas |
|
110 |
|
79 |
|
|
Glass Packaging Europe |
|
163 |
|
151 |
|
|
Glass Packaging North America |
|
137 |
|
134 |
|
|
Capital expenditure from continuing operations |
|
505 |
|
467 |
|
400 |
Capital expenditure from discontinued operation |
|
107 |
|
108 |
|
|
Net capital expenditure |
|
612 |
|
575 |
|
492 |
Capital expenditure – continuing operations
Capital expenditure for the year ended December 31, 2019 increased by $38 million to $505 million, compared to $467 million for the year ended December 31, 2018. The increase was primarily attributable to spending of $75 million on short payback projects during 2019. In Metal Beverage Packaging Europe, capital expenditure in the year ended December 31, 2019 was $95 million, compared to capital expenditure of $103 million in the same period in 2018 with the
Ardagh Group S.A.
70
decrease primarily attributable to the timing of projects. In Metal Beverage Packaging Americas capital expenditure in the year ended December 31, 2019 was $110 million compared to capital expenditure of $79 million in the same period in 2018, with the increase primarily attributable to increased capital investment initiatives. In Glass Packaging Europe, capital expenditure was $163 million in the year ended December 31, 2019, compared to capital expenditure of $151 million in the same period in 2018, reflecting short payback project spending and the timing of furnace rebuild activity. In Glass Packaging North America, capital expenditure was $137 million in the year ended December 31, 2019, compared to capital expenditure of $134 million in the same period in 2018, also due to the timing of furnace rebuild activity, partly offset by investments in short payback projects.
Capital expenditure for the year ended December 31, 2018 increased by $67 million to $467 million, compared to $400 million for the year ended December 31, 2017. The increase was primarily attributable to spending of $49 million on short payback projects during 2018. In Metal Beverage Packaging Europe, capital expenditure in the year ended December 31, 2018 was $103 million, compared to capital expenditure of $95 million in the same period in 2017 with the increase primarily attributable to short payback project spending and the timing of projects. In Metal Beverage Packaging Americas capital expenditure in the year ended December 31, 2018 was $79 million compared to capital expenditure of $69 million in the same period in 2017, with the increase primarily attributable to the investment in a new plant in Manaus, Brazil. In Glass Packaging Europe, capital expenditure was $151 million in the year ended December 31, 2018, compared to capital expenditure of $110 million in the same period in 2017, reflecting short payback project spending and the timing of furnace rebuild activity. In Glass Packaging North America, capital expenditure was $134 million in the year ended December 31, 2018, compared to capital expenditure of $126 million in the same period in 2017, also due to the timing of furnace rebuild activity.
Capital expenditure – discontinued operation
Capital expenditure for the discontinued operation for the year ended December 31, 2019 decreased by $1 million to $107 million, compared to $108 million for the year ended December 31, 2018.
Capital expenditure for the discontinued operation for the year ended December 31, 2018 increased by $16 million to $108 million, compared to $92 million for the year ended December 31, 2017.
|
C. |
|
Research and development, patents and licenses |
See “Item 4. Information on the Company—B. Business Overview—Metal Beverage Packaging—Innovation, Research and Development” and “Item 4. Information on the Company—B. Business Overview—Glass Packaging—Intellectual Property and Innovation, Development and Engineering”.
|
D. |
|
Trend information |
Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events since December 31, 2019 that are reasonably likely to have a material adverse effect on our revenues, income, profitability, liquidity or capital resources, or that would cause the reported financial information in this annual report to be not necessarily indicative of future operating results or financial conditions.
|
E. |
|
Off-balance sheet arrangements |
The Group participates in several uncommitted accounts receivable factoring and related programs with various financial institutions for certain receivables, accounted for as true sales of receivables, without recourse to the Group. Receivables of $473 million were sold under these programs at December 31, 2019 (December 31, 2018: $525 million).
Ardagh Group S.A.
71
|
F. |
|
Contractual Obligations and Commitments |
The following table outlines our principal contractual obligations as of December 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less than |
|
|
|
|
|
More than |
|
|
Total |
|
one year |
|
1 – 3 years |
|
3 – 5 years |
|
five years |
|
|
|
|
(in $ millions) |
||||||
Long term debt—capital repayment |
|
5,556 |
|
— |
|
695 |
|
832 |
|
4,029 |
Long term debt—interest * |
|
1,418 |
|
253 |
|
498 |
|
429 |
|
238 |
Lease obligations and other borrowings |
|
488 |
|
110 |
|
135 |
|
84 |
|
159 |
Purchase obligations |
|
1,628 |
|
1,628 |
|
— |
|
— |
|
— |
Derivatives |
|
1,540 |
|
367 |
|
256 |
|
917 |
|
— |
Contracted capital commitments |
|
77 |
|
77 |
|
— |
|
— |
|
— |
Total |
|
10,707 |
|
2,435 |
|
1,584 |
|
2,262 |
|
4,426 |
* Long term debt interest is calculated based on the contractual interest rates for the Senior Secured and Senior Notes as described in Note 20 to the consolidated financial statements.
Item 6. Directors, Senior Management and Employees
|
A. |
|
Directors and Officers |
Set forth below is information concerning our directors and officers as of the date of this annual report including their names, ages, positions and current directorship terms (which expire on the date of the relevant year’s annual general meeting of shareholders). For purposes of this Item 6. A, references to the “Group” refer to Ardagh Group S.A. and included pre-IPO holding entities. There are no family relationships among the executive officers or between any executive officer or director. Our executive officers are appointed by the board of directors to serve in their roles. Each executive officer is appointed for such term as may be prescribed by the board of directors or until a successor has been chosen and qualified or until such officer’s death, resignation or removal. Unless otherwise indicated, the business address of all of our executive officers and directors is 56, rue Charles Martel, L‑2134 Luxembourg, Luxembourg.
|
|
|
|
|
Name |
|
Age |
Position |
Expiration of current directorship term |
Paul Coulson |
67 |
Chairman and Chief Executive Officer |
2020 |
|
David Matthews |
56 |
Chief Financial Officer and Director |
2020 |
|
Shaun Murphy |
53 |
Chief Operating Officer and Director |
2020 |
|
Johan Gorter |
60 |
Chairman Glass North America and Director |
2021 |
|
Gerald Moloney |
62 |
Director, Executive Committee |
2022 |
|
Brendan Dowling |
72 |
Director |
2022 |
|
Houghton Fry |
74 |
Director |
2022 |
|
Philip Hammond |
65 |
Independent Non‑Executive Director |
2020 |
|
Damien O’Brien |
64 |
Independent Non‑Executive Director |
2021 |
|
Hermanus Troskie |
49 |
Independent Non‑Executive Director |
2021 |
|
Edward White |
72 |
Independent Non‑Executive Director |
2020 |
Ardagh Group S.A.
72
Backgrounds of Our Directors and Officers
Paul Coulson
Paul Coulson graduated from Trinity College Dublin with a business degree in 1973. He spent five years with Price Waterhouse in London and Dublin and qualified as a Chartered Accountant in 1978. He then established his own accounting firm before setting up Yeoman International in 1980 and developing it into a significant leasing and structured finance business. In 1998 he became Chairman of the Group and initiated the transformation of Ardagh from a small, single plant operation into a leading global packaging company. Over the last 30 years he has been involved in the creation and development of a number of businesses apart from Yeoman and Ardagh. These include Fanad Fisheries, a leading Irish salmon farming company, and Sterile Technologies. Prior to its sale to Stericycle, Inc. in 2006, Sterile Technologies had been developed into the leading medical waste management company in the United Kingdom and Ireland.
David Matthews
David Matthews was appointed Chief Financial Officer and director of the Group in 2014. Prior to joining Ardagh, Mr. Matthews held various senior finance positions at DS Smith plc and Bunzl plc. Mr. Matthews qualified as a Chartered Accountant in 1989 with Price Waterhouse in London and holds an engineering degree from the University of Southampton.
Shaun Murphy
Shaun Murphy was appointed Chief Operating Officer and Director of the Group in 2019. Prior to joining Ardagh, he was a partner at KPMG for almost 20 years and completed a six-year term as Managing Partner of KPMG in Ireland, a practice of approximately 3,000 people. Mr. Murphy also served as the Lead Director on KPMG’s Global Board from 2015 until 2019.
Johan Gorter
Johan Gorter was appointed director of the Group in 2016. Mr. Gorter joined PLM in 1998 as plant director for the Dongen glass plant. He then held several management positions within Rexam before he joined the Group in 2007 as Group Director for Continuous Improvement. He was Chief Executive Officer of Glass Packaging Europe from 2011 to 2019 and Chief Executive Officer of Glass Packaging from 2017 to 2019. Since 2020, Mr. Gorter is Chairman of Glass Packaging North America. Mr. Gorter holds a Masters in Industrial Engineering from the University of Eindhoven.
Gerald Moloney
Gerald Moloney has been a director of the Group since 2016, having served for many years on the boards of Yeoman International Group Limited and Yeoman Capital S.A. He is an executive with the Group since 2018 and is a member of the Executive Committee. He holds a law degree from University College Cork and qualified as a solicitor in 1981. He worked for a period in European law in Brussels and has many years' experience working in the areas of commercial law and commercial litigation. He is a founding partner of the commercial and litigation law firm, G.J. Moloney, with offices in Dublin and Cork, Ireland.
Brendan Dowling
Brendan Dowling has been a director of the Group since 1998. He holds graduate degrees in economics from University College Dublin and Yale University. He was Economic Advisor to the Minister for Foreign Affairs in Dublin before joining Davy Stockbrokers in 1979 as Chief Economist and later partner. He is a former member of the Committee of the Irish Stock Exchange and the Industrial Development Authority of Ireland. Prior to joining Yeoman International Group in 1995, he was Executive Chairman of Protos Stockbrokers in Helsinki, Finland.
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73
Houghton Fry
Houghton Fry qualified as a solicitor in 1967 with William Fry, Solicitors in Dublin, Ireland having obtained an LLB law degree from Trinity College, Dublin University, Ireland. He became a Partner in the firm in 1970 and, in 1986, Chairman and Senior Partner. He specialized in international corporate and financial law and had extensive transaction experience in many different jurisdictions. He retired from legal practice in 2004 and has been a director of the Group since that time.
Rt. Hon. Philip Hammond
Philip Hammond has had a distinguished career in British politics. A Member of Parliament of the United Kingdom from 1997 to 2019, he held a range of ministerial offices, most recently serving as Chancellor of the Exchequer from 2016 to 2019. Prior to this, he served as Foreign Secretary from 2014 to 2016, as Defense Secretary from 2011 to 2014 and as Transport Secretary from 2010 to 2011. Mr. Hammond joined the Board in 2019 as an independent director.
Damien O’Brien
Damien O'Brien joined the Board in 2017 as an independent director. He has served as CEO of Egon Zehnder from 2008 to 2014 and as its Chairman from 2010 to 2018. Mr. O’Brien joined Egon Zehnder in 1988 and since then he has been based in Australia, Asia and Europe. He is also a member of the boards of IMD Business School in Lausanne, Switzerland, and St. Vincents Health Australia.
Hermanus Troskie
Hermanus Troskie has been a director of the Group since 2009. Mr. Troskie is the Deputy CEO at Maitland, a global advisory and administration firm. He has extensive experience in the areas of international corporate structuring, cross‑border financing and capital markets, with a particular interest in integrated structuring for entrepreneurs and their businesses. Mr. Troskie is a director of companies within the Yeoman group of companies, and other private and public companies. He qualified as a South African Attorney in 1997, and as a Solicitor of the Senior Courts of England and Wales in 2001. Mr. Troskie is based in Luxembourg.
Edward White
Edward White has been an Executive Professor of Finance in the Mays Business School at Texas A&M University since 2014. He was formerly a Senior Vice President and the Chief Financial Officer of Owens‑Illinois, Inc.for seven years until his retirement in 2012. During his 38‑year career with O‑I, he worked in a variety of management roles across finance, manufacturing and marketing. His international experiences included senior management positions as an expatriate in Finland, Poland, France and Switzerland. Mr. White holds a Masters in Business Administration from the University of Hawaii and a Bachelors in Business Administration from Indiana University. He joined the Board in 2017 as independent director and is Chairman of the Audit Committee.
|
B. |
|
Compensation |
Director Compensation
The Company has established a compensation program for our non‑employee directors. The non‑employee directors’ compensation program will allow each non‑employee director the opportunity to elect to receive Class A common shares in lieu of a portion of the annual cash retainer payable to the non‑employee director under the program. If a non‑employee director elects to receive shares in lieu of a portion of the annual cash retainer, the Company would deliver the shares to the director at the time that the cash payment would otherwise be made to the director.
Ardagh Group S.A.
74
The aggregate amount of our non-employee directors’ compensation, as approved by the annual general meeting of shareholders for the year 2019, was approximately $700,000. We also reimburse our non‑employee directors for reasonable out‑of‑pocket expenses incurred in connection with the performance of their duties as directors, including, without limitation, travel expenses in connection with their attendance in‑person at board of directors and committee meetings. Directors who are employees do not receive any compensation for their services as directors.
Key Management Compensation
The aggregate amount of compensation our key management (including directors) received from the Group for service as key management for the year ended December 31, 2019 was $20 million. An aggregate of approximately $400,000 has been set aside or accrued for the year ended December 31, 2019 to provide pension, retirement or similar benefits to our key management (including directors). See Note 27 to the audited consolidated financial statements included elsewhere in this annual report.
|
C. |
|
Board practices |
Controlled Company
The Class A common shares are listed on the NYSE. Our Parent Company controls more than 50% of the voting power of our common shares, and, as a result, under the NYSE’s current listing standards, we qualify for and avail of the controlled company exception under the corporate governance rules of the NYSE. As a controlled company, we are not required to have (1) a majority of “independent directors” on our board of directors, (2) a compensation committee and a nominating and governance committee composed entirely of “independent directors” as defined under the rules of the NYSE or (3) an annual performance evaluation of the compensation and nominating and governance committees.
Composition of Our Board of Directors
Our board of directors currently consists of 11 members divided into three classes. Our board of directors consists of such number of directors as the general meeting of shareholders may from time to time determine.
Number and Election of Directors
Pursuant to Luxembourg Law, the board of directors must be composed of at least three directors. Under the Articles, the number of directors of the Company is not to be more than 15. The holders of the shares have the right to elect the board of directors at a general meeting of shareholders by a simple majority of the votes validly cast. The existing directors have the right to appoint persons to fill vacancies, which persons may hold office until the next following annual general meeting.
Service Contracts of Directors
There are no service contracts between us and any of our current non-employee directors providing for benefits upon termination of their service. For a discussion of compensation, including post-termination benefits, of employee directors, see “Item 6. Directors, Senior Management and Employees—B. Compensation—Key Management Compensation” above.
Board of Directors Powers and Function
The board of directors has the power to take any action necessary or useful to realize the corporate objects of the Company, with the exception of the powers reserved by Luxembourg Law or by the Articles to the general meeting of shareholders. Directors must act with diligence and in good faith in performing their duties. The expected behavior of a
Ardagh Group S.A.
75
director is that of a normally prudent person, in a like position, having the benefit, when making such a decision, of the same knowledge and information as the directors having made the decision.
Board of Directors Meetings and Decisions
We expect that all of the resolutions of the board of directors will be adopted by a simple majority of votes cast in a meeting at which a quorum is present or represented by proxy. A member of the board of directors may authorize another member of the board of directors to represent him/her at the board meeting and to vote on his/her behalf at the meeting.
Our board of directors meets as often as it deems necessary to conduct the business of the Company.
We believe that the composition of the board of directors, which includes a broad spread of nationalities, backgrounds and expertise provides the breadth and depth of skills, knowledge and experience that are required to effectively lead an internationally diverse business with interests spanning three continents and 12 individual countries.
We believe that each of the Group’s independent non-executive directors has broad-based international business expertise and many have gained significant and relevant industry specific expertise over a number of years. The composition of the board of directors reflects the need to maintain a balance of skills, knowledge and experience.
The independent non-executive directors use their broad based skills, diverse range of business and financial experiences and international backgrounds in reviewing and assessing any opportunities or challenges facing the Group and play an important role in developing the Group’s strategy and scrutinizing the performance of management in meeting the Group’s goals and objectives.
We expect our board members collectively to have the experience, qualifications, attributes and skills to effectively oversee the management of the Company, including a high degree of personal and professional integrity, an ability to exercise sound business judgment on a broad range of issues, sufficient experience and background to have an appreciation of the issues facing the Company, a willingness to devote the necessary time to board duties, a commitment to representing the best interests of the Company and a dedication to enhancing shareholder value.
Committees of the Board of Directors
Our board of directors has five standing committees: an executive committee, an audit committee, a compensation committee, a nominating and governance committee and a sustainability committee. The members of each committee are appointed by the board of directors and serve until their successors are elected and qualified, unless they are earlier removed or resign. Each of the committees’ report to the board of directors as it deems appropriate and as the board may request. The composition, duties and responsibilities of the five standing committees are set forth below. In the future, our board of directors may establish other committees, as it deems appropriate, to assist it with its responsibilities.
Executive Committee
The board of directors has established an executive committee that oversees the management of the business and affairs of the Company. Paul Coulson, David Matthews, Shaun Murphy, Gerald Moloney and a number of members of the key management of the Group serve on the executive committee as of the date of this annual report, with Paul Coulson serving as the chair of the executive committee.
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76
Audit Committee
Our audit committee consists of Edward White, Philip Hammond and Damien O’Brien, with Edward White serving as the chair of the audit committee. All of our audit committee members are independent directors, in accordance with NYSE and the SEC requirements for a company listed on the NYSE.
Our audit committee, among other matters, oversees (1) our financial reporting, auditing and internal control activities; (2) the integrity and audits of our financial statements; (3) our compliance with legal and regulatory requirements; (4) the qualifications and independence of our independent auditors; (5) the performance of our internal audit function and independent auditors; and (6) our overall risk exposure and management. Duties of the audit committee include the following:
|
· |
|
annually review and assess the adequacy of the audit committee charter and the performance of the audit committee; |
|
· |
|
be responsible for recommending the appointment, retention and termination of our independent auditors and determine the compensation of our independent auditors; |
|
· |
|
review the plans and results of the audit engagement with the independent auditors; |
|
· |
|
evaluate the qualifications, performance and independence of our independent auditors; |
|
· |
|
have authority to approve in advance all audit and non‑audit services by our independent auditors, the scope and terms thereof and the fees therefor; |
|
· |
|
review the adequacy of our internal accounting controls; and |
|
· |
|
meet at least quarterly with our executive officers, internal audit staff and our independent auditors in separate executive sessions. |
The audit committee has the power to investigate any matter brought to its attention within the scope of its duties and to retain counsel for this purpose where appropriate. Each of the audit committee members meets the financial literacy requirements of the NYSE listing standards and the board of directors has determined that Edward White qualifies as an “audit committee financial expert,” as defined in the rules of the SEC. The designation does not impose on the audit committee financial expert any duties, obligations or liabilities that are greater than those generally imposed on members of our audit committee and our board of directors. Our board of directors has adopted a written charter for the audit committee, which is available on our corporate website at https://www.ardaghgroup.com/corporate/investors.
Compensation Committee
Our compensation committee consists of Paul Coulson, Brendan Dowling, Damien O’Brien and Hermanus Troskie, with Paul Coulson serving as the chair of the compensation committee. As we are a controlled company under the rules of the NYSE, our compensation committee is not required to be independent, although if such rules change in the future or we no longer meet the definition of a controlled company under the current rules, we will adjust the composition of the compensation committee accordingly in order to comply with such rules.
The compensation committee has the sole authority to retain, and terminate, any compensation consultant to assist in the evaluation of employee compensation and to approve the consultant’s fees and the other terms and conditions of the consultant’s retention. The compensation committee, among other matters:
Ardagh Group S.A.
77
|
· |
|
assists our board of directors in developing and evaluating potential candidates for executive officer positions and overseeing the development of executive succession plans; |
|
· |
|
administers, reviews and makes recommendations to our board of directors regarding our compensation plans; |
|
· |
|
annually reviews and approves our corporate goals and objectives with respect to compensation for executive officers and, at least annually, evaluates each executive officer’s performance in light of such goals and objectives to sets his or her annual compensation, including salary, bonus and equity and non‑equity incentive compensation, subject to approval by our board of directors; and |
|
· |
|
provides oversight of management’s decisions regarding the performance, evaluation and compensation of other officers. |
Nominating and Governance Committee
Our nominating and governance committee consists of Paul Coulson, Brendan Dowling and Houghton Fry, with Paul Coulson serving as the chair of the nominating and governance committee. As we are a controlled company under the rules of the NYSE, our nominating and governance committee is not required to be independent, although if such rules change in the future or we no longer meet the definition of a controlled company under the current rules, we will adjust the composition of our nominating and governance committee accordingly in order to comply with such rules. The nominating and governance committee, among other matters:
|
· |
|
selects and recommends to the board of directors nominees for election by the shareholders or appointment by the board; |
|
· |
|
annually reviews with the board of directors the composition of the board with regards to characteristics such as independence, knowledge, skills, experience and diversity of the board members; |
|
· |
|
makes recommendations on the frequency and structure of board meetings and to monitor the functioning of the committees of the board; |
|
· |
|
develops and recommends to our board of directors a set of corporate governance guidelines applicable to us and, at least annually, reviews such guidelines and recommends changes to our board of directors for approval as necessary; and |
|
· |
|
oversees the annual self‑evaluation of our board of directors. |
Sustainability Committee
The sustainability committee consists of Shaun Murphy, Abigail Blunt (director designate), David Matthews, Oliver Graham (the CEO of Metal Beverage Packaging and director designate) and John Sadlier (the Group’s Chief Sustainability Officer), with Shaun Murphy serving as the chair of the sustainability committee. The meetings of the sustainability committee will be attended by the CEO’s of Metal Beverage Packaging Europe and Americas and Glass Packaging Europe and North America as well as our Corporate Development and Investor Relations Director, our Chief Procurement Officer, our Chief Risk Officer and our Chief Human Resources Officer. The sustainability committee, among other matters:
|
· |
|
assists the board of directors in fulfilling its oversight responsibility for the Company’s environmental and social sustainability objectives; |
Ardagh Group S.A.
78
|
· |
|
makes recommendations to the board of directors relating to environmental and social sustainability matters; |
|
· |
|
develops and oversees the implementation of a sustainability strategy; and |
|
· |
|
advises the board of directors periodically with regard to current and emerging environmental and social sustainability developments |
Code of Conduct
Our board of directors has adopted a code of conduct that establishes the standards of ethical conduct applicable to all of our directors, officers, employees, consultants and contractors. The code addresses, among other things, competition and fair dealing, conflicts of interest, financial matters and external reporting, compliance with applicable governmental laws, rules and regulations, company funds and assets, confidentiality and corporate opportunity requirements and the process for reporting violations of the code, employee misconduct, conflicts of interest or other violations. Any waiver of the code with respect to any director or executive officer will be promptly disclosed and posted on our website. Amendments to the code will be promptly disclosed and posted on our website. The code is publicly available on our website at http://ardaghgroup.com/investors and in print to any shareholder who requests a copy.
Corporate Governance Guidelines
Our board of directors has adopted corporate governance guidelines that serve as a flexible framework within which our board of directors and its committees operate. These guidelines cover a number of areas including the size and composition of the board, board membership criteria and director qualifications, director responsibilities, board agenda, roles of the chairman of the board and chief executive officer, meetings of independent directors, board member access to management and independent advisors, director communications with third parties, director compensation, director orientation and continuing education, evaluation of senior management and management succession planning. Our nominating and governance committee will review our corporate governance guidelines periodically and, if necessary, recommend changes to our board of directors. Additionally, our board of directors has adopted independence standards as part of our corporate governance guidelines. A copy of our corporate governance guidelines are posted on our website at http://ardaghgroup.com/investors.
As of December 31, 2019, we had approximately 16,300 employees globally.
As of December 31, 2019, Metal Beverage Packaging had approximately 4,600 employees globally, of which approximately 2,800 were located in Europe, approximately 1,200 were located in the United States and approximately 600 employees were located in Brazil.
As of December 31, 2019, Glass Packaging had approximately 11,700 employees, of which approximately 6,600 employees were located in Europe, approximately 5,100 employees were located in the United States.
We strive to maintain a safe working environment for all of our employees, with safety in the workplace being a key objective, measured through individual accident reports, detailed follow‑up programs and key performance indicator reporting. We believe that our safety record is among the best in the industry.
The majority of our employees are members of labor unions or are subject to centrally‑negotiated collective agreements. We generally negotiate national contracts with our unions, with variations agreed at the local plant level. Most such labor contracts have a duration of one to two years. Our management believes that, overall, our current relations with our employees are good.
Ardagh Group S.A.
79
For the employees of our subsidiaries located in countries of the European Union we have established an EWC in compliance with EU directives. The EWC acts as a communications conduit and consultative body between our EU subsidiaries and our employees. All the elected EWC country employee representatives meet at least once a year and senior management attends an annual EWC Forum meeting.
The EWC has the right to be notified of any special circumstances that would have a major impact on the interests of employees. In order to facilitate this process in an efficient and effective way, the EWC has elected a Select Committee which meets at least 4 times a year with a senior management delegation to discuss any matters which are of interest for the EWC.
EWC delegates are elected for four-year terms on the basis of legal principles or practices in the relevant countries, while the allocation of EWC delegates between countries is governed by EU directives.
E. Share Ownership
Included in Item 7.A.
Ardagh Group S.A.
80
Item 7. Major Shareholders and Related Party Transactions
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A. |
|
Major shareholders |
We have two classes of common shares: Class A common shares and Class B common shares. The rights of the holders of our Class A common shares and Class B common shares are identical except for par value, voting and conversion rights. Each Class A common share is entitled to one vote per share. Each Class B common share is entitled to ten votes per share. Each Class B common share is convertible at any time, at the option of the holder, into one Class A common share, and subject to certain exceptions, is converted into one Class A common share upon transfer to a third party.
The following table sets forth information with respect to the beneficial ownership of our outstanding shares as of December 31, 2019:
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Shares Beneficially Owned |
||||||||||
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|
Class A common shares(i) |
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Class B common shares |
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% of Total |
||||
Name of Beneficial Owner |
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Shares |
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% |
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Shares |
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% |
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Voting Power |
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||||||
ARD Finance S.A.(ii) |
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— |
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— |
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181,826,382 |
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ARD Group Finance Holdings S.A.(iii) |
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— |
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— |
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35,869,618 |
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|
|
|
|
|
Canyon Capital Advisors, LLC (iv) |
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2,905,318 |
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|
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— |
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— |
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|
|
|
Fidelity Management & Research Company (iv) |
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1,675,321 |
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|
|
— |
|
— |
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|
|
|
Private Management Group, Inc. (iv) |
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1,601,398 |
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|
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— |
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|
|
|
|
|
Clearbridge Investments, LLC (iv) |
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1,323,445 |
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|
|
— |
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|
|
|
|
|
Wellington Management Company, LLP (iv) |
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1,184,184 |
|
|
|
— |
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|
|
|
|
|
Schroder Investment Management North America, Inc. (iv) |
|
1,053,070 |
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|
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|
|
|
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Renaissance Technologies, LLC (iv) |
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942,193 |
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|
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Our directors and key management |
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|
|
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|
|
|
|
|
|
Paul Coulson |
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* |
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* |
|
— |
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— |
|
|
|
* |
David Matthews |
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* |
|
* |
|
— |
|
— |
|
|
|
* |
Shaun Murphy |
|
* |
|
* |
|
— |
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— |
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|
|
* |
Johan Gorter |
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* |
|
* |
|
— |
|
— |
|
|
|
* |
Gerald Moloney |
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* |
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* |
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— |
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— |
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|
|
* |
Brendan Dowling |
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* |
|
* |
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— |
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— |
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|
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* |
Houghton Fry |
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* |
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* |
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— |
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— |
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|
|
* |
Philip Hammond |
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* |
|
* |
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— |
|
— |
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|
|
* |
Damien O'Brien |
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* |
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* |
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— |
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— |
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|
|
* |
Hermanus Troskie |
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* |
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* |
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— |
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— |
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|
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* |
Edward White |
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* |
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* |
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— |
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— |
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|
|
* |
Oliver Graham |
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* |
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* |
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— |
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— |
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|
|
* |
John Sheehan |
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* |
|
* |
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— |
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— |
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|
|
* |
All directors and key management as a group |
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257,268 |
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|
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— |
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— |
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* |
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(i) |
|
Class A common shares represent 7.9% of the Group’s outstanding shares. |
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(ii) |
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ARD Finance S.A. is a 100% subsidiary of the Parent Company. |
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(iii) |
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ARD Group Finance Holdings S.A. is a 100% subsidiary of the Parent Company. |
(iv)Based on most recent available public filings as of the date of filing this annual report.
*Represents beneficial ownership of less than one percent or no Class A common shares.
Ardagh Group S.A.
81
The Parent Company may be deemed to be the ultimate beneficial owner of the Class B common shares held by ARD Finance S.A. and ARD Group Finance Holdings S.A.. The Parent Company has approximately 400 record shareholders and a board of directors consisting of 9 directors. No shareholder is able to elect the majority of the directors or is able to exercise veto rights over the actions of the board. A company which is owned by Paul Coulson, our Chairman and Chief Executive Officer, owns approximately 25% of the ordinary shares of the Parent Company. Through its non-controlling interest in the Yeoman group of companies, this company has an interest in a further approximate 34% of the ordinary shares of the Parent Company.
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B. |
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Related Party Information |
Relationship with our Parent Company
Our shares are currently owned indirectly by our Parent Company. Our Parent Company continues to exercise control over the composition of our board of directors and any other action requiring the approval of our shareholders.
Shareholder Agreement
In connection with our IPO, we entered into the Shareholder Agreement which is filed as an exhibit to this annual report. The Shareholder Agreement addresses, among other things:
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(i) |
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Matters relating to the assumption, indemnification and allocation of benefits and responsibilities and mutual release of liabilities in connection with arrangements and other obligations with respect to our business that were entered into by our Parent Company prior to our IPO; |
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(ii) |
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Our obligation to cooperate in providing information to our Parent Company and taking such other actions reasonably requested to facilitate the Parent Company’s ability to manage its investment in the Company and comply with governmental or contractual obligations, including reporting obligations under the 7.125%/7.875% Senior Secured Toggle Notes due 2023 (collectively, the “2023 Toggle Notes”) or any replacement notes thereof , the defense of litigation, the preparation of tax returns, financial statements or documents required to be filed with the SEC or any regulatory authority (including any stock exchange), or the management of any tax audits; |
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(iii) |
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Our acknowledgement that there is anticipated at a future date a Reorganization Event (defined as an event in which the shareholders of the Parent Company and/or its subsidiaries will receive direct ownership in a number of our common shares (in proportion to their respective ownership interest in the Parent Company and/or its subsidiaries), whether by dividend, distribution, exchange offer or other means; provided that the aggregate number of Class B common shares received by such shareholders in such event shall be substantially the same as or fewer than (adjusting for fractional shares) the number of the Class B common shares owned by the Parent Company and/or its subsidiaries immediately prior to the date of such event) and our agreement to take such actions as are necessary to implement the Reorganization Event at our cost; |
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(iv) |
|
Our intention to pay dividends to all shareholders in amounts that will, at a minimum, be sufficient to enable the Parent Company to satisfy the cash interest payment obligations under the 2023 Toggle Notes or any replacement notes thereof in accordance with applicable laws, contractual obligations and our Articles; and |
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(v) |
|
Our agreement, so long as the 2023 Toggle Notes or any replacement notes thereof, are outstanding, not to, and not to permit our subsidiaries to, agree to restrictions on the payment of dividends that are materially more restrictive than the restrictions in place under any contract or agreement existing on the closing date of our IPO, unless such restriction would not have a material adverse effect on our ability to pay dividends as described in the preceding clause (iv) (such determination to be made at the time such restrictions are entered into). |
Ardagh Group S.A.
82
Registration Rights Agreement
We have entered into a Registration Rights Agreement with the Parent Company. The Registration Rights Agreement provides customary “demand,” “shelf,” and “piggyback” registration rights to eligible holders, which includes (i) the Parent Company and its subsidiaries who hold our Class B common shares; (ii) any Qualified Holder (as defined under “Item 10. B.—Memorandum and articles of association”) of Class B or Class A common shares received in the Reorganization Event; and (iii) certain Registration Rights Transferees who acquire at least 5% of the registrable securities under the Registration Rights Agreement. The Registration Rights Agreement provides that we and the eligible holders will provide customary indemnities to one another for certain liabilities relating to such registrations.
Related Party Transactions
For additional information, see “Note 27 – Related Party Information” to the audited consolidated financial statements included elsewhere in this annual report.
There have been no materially significant related party transactions in the period since the date of approval of the financial statements included elsewhere in this annual report.
In November 2019, the Parent Company issued (i) $1,130 million aggregate principal amount of 6.500% / 7.250% Senior Secured Toggle Notes due 2027 (the “Dollar Toggle Notes”), and (ii) €1,000 million aggregate principal amount of 5.000% / 5.750% Senior Secured Toggle Notes due 2027 (the “Euro Toggle Notes”), collectively, the “Toggle Notes”. The Toggle Notes, which were used, inter alia, to redeem the 2023 Toggle Notes, are senior obligations of the Parent Company and are not obligations of ours or of our subsidiaries. However, we expect the Parent Company to direct our affairs so as to comply with the customary covenants and events of default of the Toggle Notes which include restrictions on the Parent Company’s ability to incur debt, grant liens and make investments.
Interest on the Toggle Notes is payable entirely in cash, except as set forth below:
If the Cash Available for Debt Service (as defined below) for an interest period:
(i)is equal to or exceeds 75%, but is less than 100% of the aggregate amount of cash interest payable, then the Parent Company may, at its option, elect to pay interest on up to 25% of the then outstanding principal amount of the Toggle Notes by increasing the principal amount of the outstanding Toggle Notes or by issuing additional Toggle Notes in a principal amount equal to such interest (“Parent PIK Interest”);
(ii)is equal to or exceeds 50%, but is less than 75%, of the aggregate amount of cash interest payable, then the Parent Company may, at its option, elect to pay interest on up to 50% of the then-outstanding principal amount of the Toggle Notes as Parent PIK Interest;
(iii)is equal to or exceeds 25%, but is less than 50%, of the aggregate amount of cash interest payable, then the Parent Company may, at its option, elect to pay interest on up to 75% of the then outstanding principal amount of the Toggle Notes as Parent PIK Interest; or
(iv)is less than 25% of the aggregate amount of cash interest payable, then the Parent Company may, at its option, elect to pay interest on up to 100% of the then-outstanding principal amount of the Toggle Notes as Parent PIK Interest.
“Cash Available for Debt Service” is defined as the amount equal to the sum (without duplication) of (i) all cash and cash equivalents held at the Parent Company, subject to certain exceptions and (ii) the maximum amount of all dividends and other distributions that would be lawfully permitted to be paid to the Parent Company, if any, for the purpose
Ardagh Group S.A.
83
of paying cash interest by all of the Parent Company’s restricted subsidiaries after giving effect to all corporate, shareholder or other comparable actions (including fiduciary and other directors’ duties) required in order to make such payment, requirements under applicable law and all restrictions or limitations on the ability to make such dividends or distributions that are otherwise permitted by certain restrictive covenants and provisions in financing or other contractual arrangements of our subsidiaries.
At any time prior to November 15, 2022, the Parent Company may redeem the Toggle Notes at 100% of their principal amount plus accrued and unpaid interest, if any, and any other amounts payable thereon, to the dates of redemption (excluded), plus the applicable “make‑whole” redemption premium. Except as provided under the mandatory redemption provision described below, at any time on or after November 15, 2022, the Parent Company may also redeem all or part of the Dollar Toggle Notes at 103.250% and/or all or part of the Euro Toggle Notes at 102.500%, each with the premium declining after that date.
At any time prior to November 15, 2022, the Parent Company is required to make an offer to purchase the Dollar Toggle Notes or the Euro Toggle Notes with the net cash proceeds certain sales by the Parent Company or certain holding companies of the Parent Company of our common shares at a purchase price of (i) at least 104% of the principal amount of the notes being repurchased, plus accrued and unpaid interest to the purchase date.
To facilitate making certain transactions in compliance with covenants of the Toggle Notes, the Parent Company may from time to time deposit amounts into an escrow account. These amounts will be applied to fund offers to purchase and redemptions of the Toggle Notes. On November 15, 2022, the Parent Company will be required to use any funds remaining in the escrow account to repurchase Toggle Notes at a purchase price equal to 104% of the principal amount of the Toggle Notes being repurchased, plus accrued and unpaid interest to the purchase date.
At any time on or after November 15, 2022, the Parent Company shall redeem the Dollar Toggle Notes and Euro Toggle Notes with the net cash proceeds from certain sales by the Parent Company or certain holding companies of the Parent Company of our common shares at a purchase price of 103.250% for the Dollar Toggle Notes and 102.500% for the Euro Toggle Notes, each with the premium declining after that date, plus accrued and unpaid interest, if any, to the redemption date (excluded).
In an event treated as a change of control, the Parent Company must make an offer to purchase all outstanding Toggle Notes at a redemption price of 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase.
In addition, our Parent Company is required to beneficially own, directly or indirectly, at least 80% of the total voting power and 67% of the economic rights, in our common shares.
The Toggle Notes issued by the Parent Company are secured by pledge on all our issued qualified Class B common shares.
Policy Concerning Related Person Transactions
Our board of directors has adopted a written policy, which we refer to as the related party transactions policy, for the review of any transaction, arrangement or relationship in which we are a participant, if the amount involved exceeds $120,000 and one of our executive officers, directors or beneficial owner of more than 5% of Class A common shares or Class B common shares (or their immediate family members), each of whom we refer to as a related person, has a direct or indirect material interest.
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C. |
|
Interests of experts and counsel |
Not Applicable
Ardagh Group S.A.
84
|
A. |
|
Consolidated Statements and Other Financial Information |
See Item 18. of this annual report for consolidated financial statements.
Legal or arbitration proceedings
We become involved from time to time in various claims and lawsuits arising in the ordinary course of business, such as employee claims, disputes with our suppliers, environmental liability claims and intellectual property disputes.
In 2015, the German competition authority (the Federal Cartel Office) initiated an investigation of the practices in Germany of metal packaging manufacturers, including Ardagh’s Food & Specialty Metal Packaging business which was sold to Trivium. In 2018, the European Commission took over this investigation and the German investigation is, as a result, at an end. Ardagh has agreed to provide an indemnity in respect of certain losses that Trivium might incur in connection with this investigation. The European Commission’s investigation is ongoing, and there is, at this stage no certainty as to the extent of any charge which may arise. Accordingly, no provision has been recognized.
On April 21, 2017, a jury in the United States awarded $50 million in damages against the Group’s U.S. glass packaging business, formerly Verallia North America (“VNA”), in respect of one of two asserted patents alleged to have been infringed by VNA. On March 8, 2018, the trial judge confirmed the jury verdict. On July 12, 2019, the US Court of Appeals for the Federal Circuit affirmed the District Court’s decision of March 2018. The case was filed before Ardagh acquired VNA and customary indemnifications are in place between Ardagh and the seller of VNA. Arbitration proceedings are ongoing to enforce the indemnity. On October 8, 2019, Ardagh paid the court award and related interests to the plaintiffs. The results for the year ended December 31, 2019 include the receivable for the tax adjusted indemnity.
With the exception of the above legal matters, the Group is involved in certain other legal proceedings arising in the normal course of its business. The Group believes that none of these proceedings, either individually or in aggregate, are expected to have a material adverse effect on its business, financial condition, results of operations or cash flows.
Dividend Policy
We currently pay and intend to pay a quarterly cash dividend of $0.14 per share on our Class A and Class B common shares. We offer the holders of our Class A or Class B common shares the option to elect to receive dividends in euro.
We are a holding company incorporated in Luxembourg. We depend upon dividends paid to us by our wholly owned subsidiaries to fund the payment of dividends, if any, to our shareholders. Our ability to obtain sufficient funds through dividends from subsidiaries is limited by restrictions under the terms of the agreements governing our subsidiaries’ indebtedness, including indentures governing the Secured Notes and Senior Notes. These indentures contain standard high yield debt covenants including a restricted payment covenant.
Subject to Luxembourg Law, interim dividends may be declared by the board of directors. The annual general meeting of shareholders would in the normal course be asked to declare as final the interim dividends paid during the year. Where the payments made on account of interim dividends exceed the amount of dividends subsequently approved by the shareholders at the general meeting, the additional amounts shall, to the extent of the overpayment, be deemed to have been paid on account of the next dividend. The shareholders may declare dividends at a general meeting of shareholders, but, in accordance with the provisions of the Articles, the dividend may not exceed the amount recommended by the board of directors. Dividends may only be declared from the freely distributable reserves available to the Company as determined in accordance with Luxembourg Law.
Ardagh Group S.A.
85
In addition, under the terms of the indenture governing the Toggle Notes issued by the Parent Company, the Parent Company is required to (i) pay the interest due on the Toggle Notes in cash, unless it is entitled to pay interest on up to a specified percentage of the then-outstanding principal amount of the Toggle Notes as PIK Interest (defined herein), based on the amount of the Cash Available for Debt Service and, (ii) to the extent that cash interest is payable, cause us and the Parent Company’s other restricted subsidiaries (including our subsidiaries) to take all such shareholder, corporate and other actions necessary or appropriate to permit the making of any such dividends or other distribution or other form of return on capital, provided that any such shareholder and corporate and other actions would not violate applicable law and such actions would otherwise be consistent with fiduciary and directors’ duties of the relevant companies.
We anticipate that the expected quarterly dividend will be sufficient to enable the Parent Company to satisfy its cash interest obligations under the Toggle Notes; however, because our dividends will be declared in U.S. dollars and the Parent Company’s interest obligations for the Toggle Notes are payable in a combination of U.S. dollars and euro, exchange rate fluctuations may affect the amount of the Parent Company’s interest obligations, which may require us to make a special dividend to the extent of any shortfall, which will be payable to holders of both Class A and Class B common shares.
|
B. |
|
Significant Changes |
There have been no significant changes since the approval date of the financial statements included elsewhere in this annual report. Please see note 29 of the Consolidated Financial Statements elsewhere in this annual report for details of events after the reporting period.
|
A. |
|
Offer and listing details |
Our Class A common shares are listed on the NYSE under the symbol “ARD”.
|
B. |
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Plan of distribution |
Not applicable
|
C. |
|
Markets |
New York Stock Exchange (“NYSE”)
|
D. |
|
Selling shareholders |
Not applicable
|
E. |
|
Dilution |
Not applicable
|
F. |
|
Expenses of the issue |
Not applicable
Ardagh Group S.A.
86
Item 10. Additional Information
|
A. |
|
Share Capital |
Not Applicable
|
B. |
|
Memorandum and articles of association |
The information under the headings “Description of Share Capital” and “Comparison of Luxembourg Corporate Law and Delaware Corporate Law” in Amendment No. 5 to our Registration Statement on Form F-1 (303-214684) filed on March 6, 2017 are incorporated herein by reference. There have been no changes to the Company’s Articles, except for increases in the amount of outstanding share capital, as reflected in the Company’s financial statements.
|
C. |
|
Material contracts |
In connection with the Group’s combination of its Food & Specialty Metal Packaging business with the Exal business to form Trivium, the Group entered into a Transaction Agreement with the holding company for Exal (“Element”) and Trivium, dated July 14, 2019, as amended on October 31, 2019, which effected (i) the transfer of the Group’s Food & Specialty Metal Packaging business to Trivium in exchange for approximately $2.6 billion in cash proceeds and an approximately 42% equity interest in Trivium and (ii) the transfer of Element’s Exal business to Trivium in exchange for an approximately 58% equity interest in Trivium. The equity interests issued to Ardagh and Element are subject to certain customary post-closing adjustments to reflect the amounts of net debt, cash and net working capital of the contributed businesses on the closing date. Ardagh has agreed to provide an indemnity in respect of certain losses that Trivium might incur in connection with an investigation by the European Commission of metal packaging manufacturers. See “Item 8. Financial Information—Legal or arbitration proceedings.” For further information on Trivium, see “Item 4.—Information on the Company—B. Business Overview—Joint Venture”.
|
D. |
|
Exchange controls |
There are no legislative or other legal provisions currently in force in Luxembourg or arising under the Company’s Articles that restrict the export or import of capital, including the availability of cash and cash equivalents for use by our affiliated companies, or that restrict the payment of dividends to holders of Class A common shares not resident in Luxembourg, except for regulations restricting the remittance of dividends and other payments in compliance with United Nations and EU sanctions. There are no limitations, either under the laws of Luxembourg or in the Articles, on the right of non-Luxembourg nationals to hold or vote Class A common shares.
|
E. |
|
Taxation |
Material U.S. Federal Income Tax Considerations
The following summary is a discussion of material U.S. federal income tax considerations relevant to the acquisition, ownership and disposition of our Class A common shares by U.S. Holders (as defined below). This discussion deals only with U.S. Holders who hold our Class A common shares as capital assets for U.S. federal income tax purposes. Furthermore, this discussion assumes that U.S. Holders are qualified “residents of a Contracting State” as defined in Article 4 of the U.S. Luxembourg Income Tax Treaty. This discussion is based on the tax laws of the United States, including the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations promulgated thereunder, and administrative and judicial decisions thereof, in each case as in effect on the date hereof. All of the foregoing authorities are subject to change, which change could apply retroactively and could affect the tax consequences described below. There can be no assurance that the United States Internal Revenue Service (the “IRS”) or U.S. courts will agree with the tax consequences described in this discussion.
Ardagh Group S.A.
87
This discussion does not cover all aspects of U.S. federal income taxation that may be relevant to an investor in light of such investor’s particular circumstances, including the potential application of the Medicare contribution tax on net investment income or the alternative minimum tax, any U.S. federal tax consequences other than U.S. federal income tax consequences (such as U.S. federal gift or estate tax consequences), or the U.S. federal income tax consequences to investors subject to special treatment (such as banks or other financial institutions; insurance companies; tax‑exempt entities; regulated investment companies; real estate investment trusts; investors liable for the alternative minimum tax; U.S. expatriates; dealers in securities or currencies; traders in securities; persons that directly, indirectly or constructively own 10% or more of the Company’s equity interests; investors that will hold the Class A common shares as part of straddles, hedging transactions or conversion transactions for U.S. federal income tax purposes; or U.S. Holders whose functional currency is not the U.S. dollar).
In addition, the Tax Cuts and Jobs Act of 2017, which was enacted into law on December 22, 2017, includes substantial changes to the U.S. federal income taxation of individuals and businesses which became effective from January 1, 2018. Although the new law substantially decreased corporate tax rates, all of the consequences of the new law and the proposed and final regulations promulgated thereunder, including the unintended consequences, if any, are not yet known. For the avoidance of doubt, this discussion does not cover any implications of Code section 965 (Treatment of deferred foreign income upon transition to participation exemption system of taxation) or Code section 245A (Deduction for foreign source-portion of dividends received by domestic corporations from specified 10% owned foreign corporations).
No ruling has been or will be requested from the Internal Revenue Service (the “IRS”) regarding any matter affecting us or our shareholders. The statements made herein may be challenged by the IRS and, if so challenged, may not be sustained upon review in a court.
As used herein, a “U.S. Holder” is a beneficial owner of Class A common shares that is for U.S. federal income tax purposes (i) an individual who is a citizen or resident of the United States; (ii) a corporation (or any other entity taxable as a corporation for U.S. federal income tax purposes) created in or organized under the laws of the United States, any state thereof or the District of Columbia; (iii) an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or (iv) a trust, if (a) a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. persons control all substantial decisions of the trust or (b) a valid election is in place to treat the trust as a domestic trust for U.S. federal income tax purposes.
If any entity or arrangement classified as a partnership for U.S. federal income tax purposes invests in the Class A common shares, the U.S. tax treatment of a partner in the partnership will depend on the status of the partner and the activities of the partnership. Investors that are partnerships or partners in partnerships should consult their tax advisors concerning the U.S. federal income tax consequences of the acquisition, ownership and disposition of Class A common shares.
THE DISCUSSION OF U.S. FEDERAL INCOME TAX CONSEQUENCES SET FORTH BELOW IS FOR GENERAL INFORMATION ONLY. ALL INVESTORS SHOULD CONSULT THEIR TAX ADVISORS CONCERNING THE TAX CONSEQUENCES OF ACQUIRING, OWNING AND DISPOSING CLASS A COMMON SHARES IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, INCLUDING THE APPLICABILITY AND EFFECT OF OTHER FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND POSSIBLE CHANGES IN TAX LAW.
Distributions
Subject to the discussion under “—Passive Foreign Investment Company” below, distributions made on the Class A common shares (without reduction for any Luxembourg taxes withheld) generally will be included in a U.S. Holder’s gross income as ordinary income from foreign sources to the extent such distributions are paid out of our current or accumulated earnings and profits (as determined for U.S. federal income tax purposes), in the taxable year in which the distribution is actually or constructively received. Generally, distributions in excess of our current and accumulated
Ardagh Group S.A.
88
earnings and profits will be treated as a non‑taxable return of capital to the extent of the U.S. Holder’s adjusted tax basis in the Class A common shares, and thereafter as capital gain from the disposition of our Class A common shares.
Subject to certain holding period requirements and other conditions, dividends paid to individuals and other non corporate U.S. Holders of the Class A common shares may be eligible for the special reduced rate normally applicable to long term capital gains if the dividends are “qualified dividends” for U.S. federal income tax purpose. Dividends received with respect to the Class A common shares may be qualified dividends if (a) our Class A common shares are readily tradable on the NYSE, or (b) the Company is eligible for the benefits of a comprehensive income tax treaty with the United States that the IRS has approved for purposes of the qualified dividend rules, and certain other requirements are met. Notwithstanding the foregoing, dividends received with respect to Class A common shares will not be qualified dividends if (i) the Company was a passive foreign investment company (“PFIC”) under Code section 1297(a) during the year in which the dividend is paid or the prior taxable year or (ii) the Company first became a “surrogate foreign corporation” under Code section 7874(a)(2)(B) (other than a surrogate foreign corporation treated as a domestic corporation) after December 22, 2017. Accordingly, provided that we are not and do not become a PFIC or a “surrogate foreign corporation,” dividends on our Class A common shares will be qualified dividends so long as our Class A common shares are listed on NYSE. U.S. Holders should consult their tax advisors regarding the availability of the preferential rate on dividends to their particular circumstances. Distributions received on the Class A common shares will not be eligible for the dividends received deduction allowed to corporations; however, certain 10% corporate shareholders may be eligible for a deduction under section 245A (Deduction for foreign source-portion of dividends received by domestic corporations from specified 10% owned foreign corporations), if applicable.
Distributions on the Class A common shares will be paid in U.S. dollars with an election for U.S. Holders to receive amounts paid in euro. U.S. Holders electing to receive distributions in euro should consult their tax advisors regarding the impact of such election in their particular circumstances.
Effect of Luxembourg Withholding Taxes
As discussed in “—Material Luxembourg Tax Considerations”, under current Luxembourg Law payments of dividends made on the Class A common shares generally are subject to a 15% Luxembourg withholding tax. This rate is not generally reduced under the U.S.‑Luxembourg Treaty. For U.S. federal income tax purposes, U.S. Holders will be treated as having received the amount of any Luxembourg taxes withheld, and as then having paid over the withheld taxes to the Luxembourg taxing authorities. As a result, the amount of dividend income included in gross income for U.S. federal income tax purposes by a U.S. Holder with respect to a payment of dividends may be greater than the amount of cash actually received by the U.S. Holder.
Subject to certain limitations and restrictions, a U.S. Holder may be able to claim a foreign tax credit for U.S. federal income tax purposes with respect to any non‑U.S. withholding tax (including any Luxembourg withholding tax) imposed on distributions, so long as the U.S. Holder elects not to take a deduction for any non‑U.S. taxes for that taxable year.
For purposes of the foreign tax credit limitation, foreign source income is classified in one of four “baskets,” and the credit for foreign taxes on income in any basket is limited to U.S. federal income tax allocable to that income. Dividends paid on the Class A common shares generally will constitute foreign source income in the “passive income” basket, which generally includes dividends, interest, royalties, rents, income from interest equivalents and notional principal contracts, foreign currency gains and certain other categories of income, subject to exceptions. If a U.S. Holder receives a dividend that qualifies for the special reduced rate normally applicable to long‑term capital gains described above under “—Distributions,” the amount of the dividend taken into account in calculating the foreign tax credit limitation will in general be limited to the gross amount of the dividend, multiplied by the reduced rate divided by the highest rate of tax normally applicable to dividends. A U.S. Holder may be unable to claim foreign tax credits (and may instead be allowed deductions) for non‑U.S. withholding taxes, including any Luxembourg withholding taxes, imposed on a dividend if the U.S. Holder has not held the shares for at least 16 days in the 31‑day period beginning 15 days before the ex‑dividend date. U.S. Holders are urged to consult their tax advisors.
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The rules relating to foreign tax credits and deductions are complex. U.S. Holders should consult their tax advisors concerning the application of these rules in their particular circumstances.
Sale, Exchange or other Taxable Disposition
Subject to the discussion under “—Passive Foreign Investment Company” below, a U.S. Holder generally will recognize capital gain or loss on the sale, exchange or other taxable disposition of the Class A common shares in an amount equal to the difference, if any, between the amount realized on such sale, exchange or other taxable disposition and its adjusted tax basis in the Class A common shares. The adjusted tax basis in Class A common shares generally will be equal to the cost of such Class A common shares. The capital gain or loss will be long‑term capital gain or loss if a U.S. Holder has held the Class A common shares for more than one year. In the case of non‑corporate U.S. Holders, long‑term capital gain is generally subject to U.S. federal income tax at preferential rates. The deductibility of capital losses is subject to significant limitations.
Any gain or loss recognized by a U.S. Holder on the sale, exchange or other taxable disposition of the Class A common shares generally will be treated as U.S. source gain or loss for U.S. foreign tax credit purposes. Accordingly, if any gain from the sale, exchange or other taxable disposition of the Class A common shares is subject to a non‑U.S. tax, U.S. Holders may not be able to obtain a credit or claim a deduction against their U.S. federal income tax liability because the gain generally would not qualify as foreign source income. U.S. Holders should consult their tax advisors regarding the availability of foreign tax credits or deductions in connection with non‑U.S. taxes imposed on the gain realized upon the sale, exchange or other taxable disposition of the Class A common shares.
See “—Passive Foreign Investment Company” below for a discussion of more adverse rules that will apply to a sale, exchange or other taxable disposition of Class A common shares if the Company is or becomes a PFIC for U.S. federal income tax purposes.
Passive Foreign Investment Company & Surrogate Foreign Corporation Status
The Company believes it was not a PFIC for U.S. federal income tax purposes in the 2019 taxable year and based on the nature of the Company’s business, the projected composition of the Company’s income and the projected composition and estimated fair market values of the Company’s assets, the Company does not expect to be a PFIC for U.S. federal income tax purposes in 2020 or in the foreseeable future. However, the determination of whether the Company is a PFIC is made annually, after the close of the relevant taxable year. Therefore, it is possible that the Company could be classified as a PFIC depending on, among other things, changes in the nature of the Company’s business, composition of its assets or income, as well as changes in its market capitalization. Accordingly, no assurance can be given that the Company will not be a PFIC in any given taxable year.
A non‑U.S. corporation generally will be a PFIC for U.S. federal tax purposes in any taxable year in which, after taking into account the income and assets of the corporation and certain subsidiaries pursuant to applicable look‑through rules, either:
(i)at least 75% of its gross income is “passive income”; or
(ii)at least 50% of the average quarterly value of its gross assets (which may be determined in part by the market value of Class A common shares, which is subject to change) is attributable to assets that produce “passive income” or are held for the production of “passive income”.
Passive income for this purpose generally includes dividends, interest, royalties, rents and certain gains from commodities (other than commodities sold in an active trade or business) and securities transactions.
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The Company believes it was not a surrogate foreign corporation for U.S. federal income tax purposes in the 2019 taxable year and furthermore the Company does not expect to be a surrogate foreign corporation for U.S. federal income tax purposes in 2020 or in the foreseeable future. However, the determination of whether the Company is a surrogate foreign corporation is made on a real-time basis. Accordingly, no assurance can be given that the Company will not be a surrogate foreign corporation in any given taxable year.
A non U.S. corporation generally will be a surrogate foreign corporation for U.S. federal tax purposes following a transaction under which:
(i)it acquires (after March 4, 2003) substantially all of the properties held by a U.S. corporation;
(ii)after the acquisition, the U.S. corporation’s former shareholders own at least 60 percent of the stock (by vote or value) of the foreign acquiring corporation; and
(iii)the expanded affiliated group that includes the foreign acquiring corporation does not have substantial business activities in the country where the foreign acquiring corporation is organized or created compared to the total business activities of the expanded affiliated group
If the Company is treated as a PFIC for any taxable year during which a U.S. Holder holds Class A common shares, any gain recognized by a U.S. Holder upon a sale or other taxable disposition (including certain pledges) of Class A common shares generally will be allocated ratably over the U.S. Holder’s holding period for such Class A common shares. The amounts allocated to the taxable year of the sale or other taxable disposition and to years before the Company became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest marginal rate in effect for that taxable year for individuals or corporations, as appropriate, (regardless of the U.S. Holder’s actual tax rate and without reduction for any losses) and an interest charge would be imposed on the tax attributable to the allocated amount to reflect the value of the tax deferral. Further, to the extent that any distribution received by a U.S. Holder on Class A common shares exceeds 125% of the average of the annual distributions on such Class A common shares received during the preceding three years or the U.S. Holder’s holding period, whichever is shorter, that distribution would be subject to taxation in the same manner as gain, as described immediately above.
Certain elections may be available that would result in alternative treatments (such as mark‑to‑market treatment) of the Class A common shares. An election for mark‑to‑market treatment is available only if the Class A common shares are considered “marketable stock”, which generally includes stock that is regularly traded in more than de minimis quantities on a qualifying exchange (such as the NYSE). No assurance can be given that the Class A common shares are considered regularly traded on a qualifying exchange, and therefore considered “marketable stock,” for purposes of the PFIC mark‑to‑market election. Each U.S. Holder is encouraged to consult its tax advisor as to whether a mark‑to‑market election is available or desirable in their particular circumstances. The Company does not intend to prepare or provide the information that would enable U.S. Holders to make a “qualified electing fund” election.
U.S. Holders should consult their tax advisors concerning the Company’s possible PFIC and/or surrogate foreign corporation status and the consequences to them if the Company were a PFIC and/or surrogate foreign corporation for any taxable year.
Information Reporting and Backup Withholding
In general, payments of dividends and proceeds from the sale or other disposition, with respect to the Class A common shares held by a U.S. Holder may be required to be reported to the IRS unless the U.S. Holder is an exempt recipient and, when required, demonstrates this fact. In addition, a U.S. Holder that is not an exempt recipient may be subject to backup withholding (currently at a rate of 28%) unless it provides a taxpayer identification number and otherwise complies with applicable certification requirements.
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Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a U.S. Holder’s U.S. federal income tax liability and may entitle a U.S. Holder to a refund, provided that the appropriate information is timely furnished to the IRS. U.S. Holders should consult with their tax advisors regarding the application of the U.S. information reporting and backup withholding regime.
Foreign Financial Asset Reporting
Certain non‑corporate U.S. Holders are required to report information with respect to investments in Class A common shares not held through an account with certain financial institutions. U.S. Holders that fail to report required information could become subject to substantial penalties. Potential investors are encouraged to consult with their tax advisors about these and any other reporting obligations arising from their investment in Class A common shares.
Material Luxembourg Tax Considerations
Luxembourg Tax Considerations
Scope of Discussion
This summary is based on the laws of Luxembourg, including the Income Tax Act of December 4, 1967, as amended, the Municipal Business Tax Act of December 1, 1936, as amended and the Net Wealth Tax Act of October 16, 1934, as amended, to which we jointly refer as the “Luxembourg tax law”, existing and proposed regulations promulgated thereunder, and published judicial decisions and administrative pronouncements, each as in effect on the date hereof. This discussion does not generally address any aspects of Luxembourg taxation other than income tax, corporate income tax, municipal business tax, withholding tax and net wealth tax. This discussion, while not being a complete analysis or listing of all of the possible tax consequences of holding and disposing of Class A common shares, addresses the material tax issues. Also, there can be no assurance that the Luxembourg tax authorities will not challenge any of the Luxembourg tax consequences described below; in particular, changes in law and/or administrative practice, as well as changes in relevant facts and circumstances, may alter the tax considerations described below.
For purposes of this discussion, a “Luxembourg holder” is any beneficial owner of Class A common shares that for Luxembourg income tax purposes is:
1.an individual resident of Luxembourg under article 2 of the Luxembourg Income Tax Act, as amended; or
2.a corporation or other entity taxable as a corporation that is organized under the laws of Luxembourg under article 159 of the Income Tax Act, as amended.
A “non‑Luxembourg holder” of Class A common shares is a holder that is not a Luxembourg holder. For purposes of this summary, “holder” or “shareholder” means either a Luxembourg holder or a non‑Luxembourg holder or both, as the context may require.
This discussion does not constitute tax advice and is intended only as a general guide. However, the summary, while not being exhaustive, addresses the material tax issues. Shareholders should also consult their own tax advisors as to the Luxembourg tax consequences of the ownership and disposition of the Company’s Class A common shares. The summary applies only to shareholders who own the Company’s Class A common shares as capital assets and does not apply to other categories of shareholders, such as dealers in securities, trustees, insurance companies, collective investment schemes and shareholders who have, or who are deemed to have, acquired their Class A common shares in the capital of the Company by virtue of an office or employment.
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Company
The Company is a Luxembourg tax resident entity and it will therefore be subject to Luxembourg corporate income tax, municipal business tax, withholding tax, and net wealth tax.
Corporate Income Tax / Municipal Business Tax
A Luxembourg resident company is subject to corporate income tax and municipal business tax on its worldwide income at the global tax rate (including solidarity surcharge) of 24.94% in 2020 (on the basis the Company is established in Luxembourg City). This rate is composed of the corporate income tax rate of 17%, the solidarity surcharge of 1.19% (7% on the corporate income tax rate) and the municipal business tax rate of 6.75%.
Qualifying dividend income, liquidation proceeds and net capital gains on the sale of qualifying investments in subsidiaries generally is exempt from corporate income tax and municipal business tax under Luxembourg’s “participation exemption” rules, which also includes specific anti‑hybrid and anti‑abuse rules. Based on the Luxembourg participation exemption regime, dividends, liquidation proceeds received by the Company from its qualifying subsidiaries and capital gains from sales by the Company of investments in its qualifying subsidiaries should be exempt from corporate income tax and municipal business tax.
Since January 1, 2019, Luxembourg is operating controlled foreign corporation (CFC) rules. The CFC rules apply under specific conditions, the impact being to attribute and tax undistributed profits from a low-taxed foreign subsidiary or permanent establishment at the level of its Luxembourg parent company. The CFC income will be subject to corporate income tax in Luxembourg, but not to municipal business tax.
Net Wealth Tax
A Luxembourg resident company is subject annually to net wealth tax on its worldwide net wealth up to €500,000,000 at a rate of 0.5%. A reduced rate of 0.05% however applies to the portion of net wealth base which exceeds the amount of €500,000,000. Qualifying investments in subsidiaries generally are exempt from net wealth tax. Consequently, the fair market value of qualifying investments held by the Company should be exempt from net wealth tax.
An annual minimum net wealth tax (ranging between €535 and €32,100) may apply depending on the balance sheet composition of the Company.
Registration duty
The issuance of shares and increases in the capital of Luxembourg corporations is subject to a Luxembourg flat registration duty of €75 (this flat registration duty would actually be due on any modification of the Luxembourg corporation’s bylaws).
Shareholders
The tax consequences discussed below, while not being a complete analysis or listing of all the possible tax consequences that may be relevant to our shareholders, are materially complete. Shareholders should consult their own tax advisor in respect of the tax consequences related to ownership, sale or other disposition of Class A common shares in the Company.
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Luxembourg Income Tax on Dividends and Similar Distributions
A non‑Luxembourg resident holder will not be subject to Luxembourg income taxes on dividend income and similar distributions in respect of Class A common shares in the Company unless such shares are attributable to a permanent establishment or a fixed place of business maintained in Luxembourg by such non‑Luxembourg resident holder. However, dividends and similar distributions are generally subject to Luxembourg withholding tax. We assume the non resident holder is resident in a tax treaty country. We will disregard cases where holders may be residents in a non-tax treaty country.
A Luxembourg resident individual holder will be subject to Luxembourg individual income taxes on dividend income and similar distributions in respect of Class A common shares in the Company. Luxembourg individual income tax will be levied on 50% of the gross amount of the dividends, under certain conditions, at progressive rates. Taxable dividends are also subject to dependence insurance contribution levied at a rate of 1.4% on the net income in presence of Luxembourg resident holders affiliated to the Luxembourg social security. The dependence insurance contribution on private income not exceeding €24.79 per annum is considered to be nil. The first €1,500 (or €3,000 for couples filing jointly) of investment income (including dividends and other types of investment income) is exempt from individual income tax in Luxembourg. In addition, investment related expenses may be tax deductible.
A Luxembourg resident corporation may benefit from the Luxembourg participation exemption with respect to dividends received if certain conditions are met: (a) the holder’s Class A common shares form a stake of at least 10% of the total issued share capital in the Company or have a cost price of at least €1,200,000 and (b) such qualifying shareholding has been held for an uninterrupted period of at least 12 months or the Luxembourg corporate entity holder undertakes to continue to own such qualifying shareholding until such time as the entity has held the minimum stake for an uninterrupted period of at least 12 months.
The application of the Luxembourg participation exemption to a Luxembourg resident corporation is not granted if the dividend distributed by taxable companies which are resident in other EU Member States is part of a tax avoidance scheme (general anti‑abuse rule) or if such distributions are deductible by the payer located in another EU Member State or outside the EU in certain cases (anti-hybrid rule).
If the conditions with respect to the Luxembourg participation exemption are not met, the aforementioned 50% exemption may also apply to dividends received by a Luxembourg resident corporation.
Luxembourg Wealth Tax
A non‑Luxembourg holder will not be subject to Luxembourg wealth taxes unless the holder’s Class A common shares are attributable to a permanent establishment or a fixed place of business maintained in Luxembourg by such non‑Luxembourg holder.
Luxembourg resident individual holders are not subject to Luxembourg wealth tax. A Luxembourg corporate entity holder will be subject to Luxembourg net wealth tax, in respect of the Class A common shares held in the capital of the Company unless such shares form a stake of at least 10% of the total issued share capital of the Company or have a cost price of at least €1,200,000.
Luxembourg Capital Gains Tax upon Disposal of Class A Common Shares
A non‑Luxembourg holder will be subject to Luxembourg income taxes for capital gains in the following cases:
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holder is required to recognize capital gains or losses on the sale of such shares, which will be subject to income tax and municipal business tax, unless the participation exemption applies; or |
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At any time within a five‑year period prior to the disposal of Class A common shares in the Company, the holder’s shares and those held by close relatives belong to a substantial shareholding of more than 10% (directly or indirectly) of the total issued share capital of the Company and the shares sold have been disposed (or deemed disposed) of within a period of six months following their acquisition or the holder of the above‑mentioned shares has been a Luxembourg resident taxpayer for more than 15 years and has become a non‑resident taxpayer less than 5 years prior to the disposal of the shares, provided no provisions of a treaty for the avoidance of double taxation can be invoked to override this domestic law result. |
For non‑Luxembourg individual holders, no taxation should occur in principle in Luxembourg on the sale of Class A common shares where the individual holder is a resident of a tax treaty country.
A Luxembourg resident individual holder will be subject to Luxembourg income taxes for capital gains in the following cases:
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If the Class A common shares (1) represent the assets of a business or (2) were acquired for speculative purposes (i.e. disposed of within six months after acquisition), then any capital gain will be taxed at ordinary income tax rates and subject to dependence insurance contribution levied at a rate of 1.4% (note that a “step up in basis” mechanism could be applicable for holders transferring their residence to Luxembourg); and |
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Provided that the Class A common shares do not represent the assets of a business, and the Luxembourg resident individual has disposed of them more than six months after their acquisition, then the capital gains are taxable at half the overall tax rate if such shares belong to a substantial participation (i.e., a shareholder representing more than 10% of the share capital, owned by the Luxembourg resident individual or together with his spouse/registered partner and dependent children, directly or indirectly at any time during the five years preceding the disposal). In this case, the first €50,000 (€100,000 for jointly taxed couples) in an 11-year period are however tax exempt. In addition, the capital gains would be subject to dependence insurance contribution levied at a rate of 1.4% in presence of Luxembourg resident holders affiliated to the Luxembourg social security. |
Different rules may apply in the scenario of exchange of shares, which may under certain conditions be tax neutral.
A Luxembourg corporate entity holder will be subject to Luxembourg corporate income tax and municipal business tax for capital gains unless (a) the holder’s Class A common shares form a stake of at least 10% of the total issued share capital in the Company or have a cost price of at least €6,000,000 and (b) such qualifying shareholding has been held for an uninterrupted period of at least 12 months or the Luxembourg corporate entity holder undertakes to continue to own such qualifying shareholding until such time as the entity has held the minimum stake for an uninterrupted period of at least 12 months. Expenses directly related to a participation that qualifies for the exemption (e.g., interest expenses) are only deductible for the amount exceeding exempt income arising from the relevant participation in a given year. Decreases in the acquisition cost of a participation that qualifies for the exemption are deductible. The exempt amount of a capital gain realized on a qualifying participation is, however, reduced by the amount of any expenses related to the participation, including decreases in the acquisition cost, that have previously reduced the company’s Luxembourg taxable income. However, decreases in the acquisition cost that result from dividend distributions are not tax deductible because the dividends are tax exempt. If a parent company writes off part or all of a loan to its subsidiary, the value adjustment is treated in the same way as decreases in the acquisition cost of the participation, i.e., this is taken into account when calculating the exempt capital gain.
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Luxembourg Withholding Tax—Distributions to Shareholders
A Luxembourg withholding tax of 15% is due on dividends and similar distributions to the Company’s holders (subject to the exceptions discussed under “Exemption from Luxembourg Withholding Tax—Distributions to Shareholders”). The Company will be required to withhold at such rate from amounts payable to the shareholder and pay such withheld amounts to the Luxembourg tax authorities.
Exemption from Luxembourg Withholding Tax—Distributions to Shareholders
Dividends and similar distributions paid to the Company’s Luxembourg and non‑Luxembourg holders may be exempt from Luxembourg dividend withholding tax if: (1) the shareholder is a qualifying corporate entity holding a stake of at least 10% of the total issued and outstanding share capital of the Company or acquired the Company’s Class A common shares for at least €1,200,000; and (2) such qualifying shareholder has either held this qualifying stake in the capital of the Company for an uninterrupted period of at least 12 months at the time of the payment of the dividend. If the minimum 12‑month retention period is not met at the distribution date, the tax is first withheld and refunded by the Luxembourg tax authorities once the 12 months retention period is effectively met. However, based on the current practice the Luxembourg tax authorities usually accept to not levy the dividend withholding tax if a commitment to hold the qualifying shareholding for an uninterrupted period of at least 12 months is made. Examples of qualifying corporate shareholders are taxable Luxembourg companies, certain taxable companies resident in other EU member states, qualifying permanent establishments, capital companies resident in Switzerland subject to income tax (without benefiting from an exemption) and share capital companies fully subject to a tax corresponding to Luxembourg corporate income tax (levied on a similar taxable basis compared to what it would be in Luxembourg) that are resident in countries that have concluded a treaty for the avoidance of double taxation with Luxembourg. Residents of countries that have concluded a treaty for avoidance of double taxation with Luxembourg might claim application of a reduced rate on or exemption from dividend withholding tax, depending on the terms of the relevant tax treaty.
The application of the dividend withholding tax exemption to taxable companies resident in other EU member states or to their EU permanent establishments is not granted if the income allocated is part of a tax avoidance scheme (general anti‑abuse rule).
Reduction of Luxembourg Withholding Tax—Distributions to Shareholders
As mentioned above, pursuant to the provisions of certain bilateral treaties for the avoidance of double taxation concluded between Luxembourg and other countries, and under certain circumstances, the aforementioned Luxembourg dividend withholding tax may be reduced, but only with respect to corporate direct investment dividends. Luxembourg has entered into bilateral treaties for the avoidance of double taxation with:
Andorra; Armenia; Austria; Azerbaijan; Bahrain; Barbados; Belgium; Brazil; Brunei; Bulgaria; Canada; China; Croatia; Czech Republic; Cyprus; Denmark; Estonia; Finland; France; Georgia; Germany; Greece; Guernsey; Hong Kong; Hungary; Iceland; India; Indonesia; Ireland; Isle of Man; Israel; Italy; Jersey; Japan; Kazakhstan; Kosovo; Laos; Latvia; Liechtenstein; Lithuania; Macedonia; Malta; Malaysia; Mauritius; Mexico; Moldova; Monaco; Morocco; The Netherlands; Norway; Panama; Poland; Portugal; Qatar; Romania; Russia; Saudi Arabia; San Marino; Senegal; Serbia; Seychelles; Singapore; Slovak Republic; Slovenia; Sri Lanka; South Africa; South Korea; Spain; Sweden; Switzerland; Tajikistan; Taiwan; Thailand; Trinidad and Tobago; Tunisia; Turkey; Ukraine; United Arab Emirates; United Kingdom; United States of America; Uruguay; Uzbekistan; and Vietnam.
U.S. Holders. The Luxembourg‑U.S. Tax Treaty provides that U.S. residents eligible for benefits under the treaty can seek a refund of the Luxembourg withholding tax on dividends for the portion exceeding 15% in respect of portfolio dividends, i.e., dividends distributed on shareholdings of less than 10% of the total issued share capital of the dividend paying entity. Given that the domestic Luxembourg withholding tax rate is 15%, no further reductions can be obtained in respect of these portfolio dividends received by a U.S. holder.
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Credit of Luxembourg Withholding Tax on Dividends and Other Distributions
Luxembourg Holders. Subject to the satisfaction of certain conditions and assuming, in the case of corporate holders, that the participation exemption does not apply, only half of the gross amount of a dividend distributed to a Luxembourg corporate or individual holder will be subject to respectively Luxembourg corporate income tax and municipal business tax for the Luxembourg corporate holder or Luxembourg income tax for the Luxembourg individual holder. All or part of the withholding tax levied can in principle be credited against the applicable tax.
THE LUXEMBOURG TAX CONSIDERATIONS SUMMARIZED ABOVE ARE FOR GENERAL INFORMATION ONLY. EACH SHAREHOLDER IN THE COMPANY SHOULD CONSULT HIS OR HER TAX ADVISOR AS TO THE PARTICULAR CONSEQUENCES THAT MAY APPLY TO SUCH SHAREHOLDER.
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Statement by experts |
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Documents on display |
We provide our shareholders with annual reports on Form 20‑F containing financial statements audited by our independent auditors within 120 days after the end of each fiscal year. We also issue quarterly earnings press releases as soon as practicable after the end of each quarter and quarterly reports containing interim unaudited financial statements within 60 days after the end of each fiscal quarter. We furnish these earnings press releases and quarterly reports to the SEC on Form 6‑K and these are publicly available on our website at https://www.ardaghgroup.com/corporate/investors and in print to any shareholder who requests a copy.
The SEC maintains a website at www.sec.gov that contains reports and information statements and other information regarding registrants like us that file electronically with the SEC. For further information about us and our shares, you can also inspect our registration statement and the reports and other information that we file or furnish with the SEC on this website. Our filings with the SEC are available through the electronic data gathering, analysis and retrieval (EDGAR) system of the SEC.
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Subsidiary Information |
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Item 11. Quantitative and Qualitative Disclosures About Market Risk
The statements about market risk below relate to our historical financial information included in this annual report.
Interest Rate Risk
The Board’s policy, in the management of interest rate risk, is to strike the right balance between the Group’s fixed and floating rate financial instruments, which occasionally includes the use of CCIRS. The balance struck by the Board is dependent on prevailing interest rate markets at any point in time.
At December 31, 2019, the Group’s external borrowings were 88.1% (2018: 90.1%) fixed, with a weighted average interest rate of 4.6% (2018: 5.4%; 2017: 5.5%). The weighted average interest rate of the Group for the year ended December 31, 2019 was 4.0% (2018: 5.0%; 2017: 4.9%).
Holding all other variables constant, including levels of the Group’s external indebtedness, at December 31, 2019 a one percentage point increase in variable interest rates would increase interest payable by approximately $11 million (2018: $9 million).
Currency Exchange Risk
The Group presents its consolidated financial information in U.S. dollar. The functional currency of the Company is the euro.
The Group operates in 12 countries, across three continents and its main currency exposure in the year to December 31, 2019, from the euro functional currency, was in relation to the U.S. dollar, British pound, Swedish krona, Polish zloty, Danish krone and Brazilian real. Currency exchange risk arises from future commercial transactions, recognized assets and liabilities, and net investments in foreign operations.
As a result of the consolidated financial statements being presented in U.S dollar, the Group’s results are also impacted by fluctuations in the U.S. dollar exchange rate versus the euro.
The Group has a limited level of transactional currency exposure arising from sales or purchases by operating units in currencies other than their functional currencies.
The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed primarily through borrowings and swaps denominated in the Group’s principal foreign currencies.
Fluctuations in the value of these currencies with respect to the euro functional currency may have a significant impact on the Group’s financial condition and results of operations. The Group believes that a strengthening of the euro exchange rate (the functional currency) by 1% against all other foreign currencies from the December 31, 2019 rate would decrease shareholders’ equity by approximately $4 million (2018: $2 million decrease).
Commodity Price Risk
The Group is exposed to changes in prices of our main raw materials, primarily energy, aluminum and steel. Production costs in our Metal Beverage Packaging division are exposed to changes in prices of our main raw materials, primarily aluminum and steel. Aluminum ingot is traded daily as a commodity on the London Metal Exchange, which has historically been subject to significant price volatility. Because aluminum is priced in U.S. dollars, fluctuations in the U.S. dollar/ euro rate also affect the euro cost of aluminum ingot. The price and foreign currency risk on the aluminum purchases in Metal Beverage Packaging Europe and Metal Beverage Packaging Americas are hedged by entering into swaps under
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which we pay fixed euro and U.S. dollar prices, respectively. Steel price has a variable cost associated with its raw material components, coking coal and iron ore. Similarly to aluminum ingots, coking coal and iron ore are priced in U.S. dollars. The price and foreign currency risk on the steel purchases in Metal Beverage Packaging Europe are hedged by entering into swaps under which we pay fixed euro. The hedging market for coking coal is a relatively new market which does not have the depth of the aluminum market and as a consequence, there might be limitations to placing hedges in the market. Furthermore, the relative price of oil and its by products may materially impact our business, affecting our transport, lacquer and ink costs.
Where we do not have pass through contracts in relation to the underlying metal raw material cost the Group uses derivative agreements to manage this risk. The Group depends on an active liquid market and available credit lines with counterparty banks to cover this risk. The use of derivative contracts to manage our risk is dependent on robust hedging procedures. Increasing raw material costs over time has the potential, if we are unable to pass on price increases, to reduce sales volume and could therefore have a significant impact on our financial condition. The Group is also exposed to possible interruptions of supply of aluminum and steel or other raw materials and any inability to purchase raw materials could negatively impact our operations.
Production costs in our Glass Packaging division are sensitive to the price of energy. Our main energy exposure is to the cost of gas and electricity. These energy costs have experienced significant volatility in recent years with a corresponding effect on our production costs. In terms of gas, which represents 50% of our energy costs, there is a continuous de coupling between the cost of gas and oil, whereby now only significant changes in the price of oil have an impact on the price of gas. The volatility in gas pricing is driven by shale gas development (United States only), the availability of liquefied natural gas in Europe, as both Europe and Asia compete for shipments, and storage levels. Volatility in the price of electricity is caused by the German Renewable Energy policy, the phasing out of nuclear generating capacity, fluctuations in the price of gas and coal and the influence of carbon dioxide costs on electricity prices.
As a result of the volatility of gas and electricity prices, the Group has either included energy pass through clauses in our sales contracts or developed an active hedging strategy to fix a significant proportion of our energy costs through contractual arrangements directly with our suppliers, where there is no energy clause in the sales contract.
Where pass through contracts do not exist the Group policy is to purchase gas and electricity by entering into forward price fixing arrangements with suppliers for the bulk of our anticipated requirements for the year ahead. Such contracts are used exclusively to obtain delivery of our anticipated energy supplies. The Group does not net settle, nor do we sell within a short period of time after taking delivery. The Group avails of the own use exemption and, therefore, these contracts are treated as executory contracts.
The Group typically builds up these contractual positions in tranches of approximately 10% of the anticipated volumes. Any gas and electricity which is not purchased under forward price fixing arrangements is purchased under index tracking contracts or at spot prices. As at December 31, 2019, we have 92% and 59% of our energy risk covered for 2020 and 2021, respectively.
Credit Risk
Credit risk arises from derivative contracts, cash and deposits held with banks and financial institutions, as well as credit exposures to the Group’s customers, including outstanding receivables. Group policy is to place excess liquidity on deposit, only with recognized and reputable financial institutions. For banks and financial institutions, only independently rated parties with a minimum rating of “BBB+” from at least two credit rating agencies are accepted, where possible. The credit ratings of banks and financial institutions are monitored to ensure compliance with Group policy. Risk of default is controlled within a policy framework of dealing with high quality institutions and by limiting the amount of credit exposure to any one bank or institution.
Group policy is to extend credit to customers of good credit standing. Credit risk is managed on an on‑going basis, by experienced people within the Group. The Group’s policy for the management of credit risk in relation to trade
Ardagh Group S.A.
99
receivables involves periodically assessing the financial reliability of customers, taking into account their financial position, past experience and other factors. Provisions are made, where deemed necessary, and the utilization of credit limits is regularly monitored. Management does not expect any significant counterparty to fail to meet its obligations. The maximum exposure to credit risk is represented by the carrying amount of each asset. For the year ended December 31, 2019, the Group’s ten largest customers accounted for approximately 47% of total revenues from continuing operations (2018: 48%; 2017: 42%). There is no recent history of default with these customers.
Surplus cash held by the operating entities over and above the balance required for working capital management is transferred to Group Treasury. Group Treasury invests surplus cash in interest‑bearing current accounts and time deposits with appropriate maturities to provide sufficient headroom as determined by the below‑mentioned forecasts.
Liquidity Risk
The Group is exposed to liquidity risk which arises primarily from the maturing of short term and long term debt obligations and from the normal liquidity cycle of the business throughout the course of a year. The Group’s policy is to ensure that sufficient resources are available either from cash balances, cash flows or undrawn committed bank facilities, to ensure all obligations can be met as they fall due.
To effectively manage liquidity risk, the Group:
|
· |
|
has committed borrowing facilities that it can access to meet liquidity needs; |
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· |
|
maintains cash balances and liquid investments with highly‑rated counterparties; |
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· |
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limits the maturity of cash balances; |
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· |
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borrows the bulk of its debt needs under long term fixed rate debt securities; and |
|
· |
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has internal control processes to manage liquidity risk. |
Cash flow forecasting is performed in the operating entities of the Group and is aggregated by Group Treasury. Group Treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans.
Item 12. Description of Securities Other than Equity Securities
Not applicable
Item 13. Defaults, Dividend Arrearages and Delinquencies
None
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
Not applicable
Ardagh Group S.A.
100
Item 15. Controls and Procedures
|
A. |
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Disclosure Controls and Procedures |
Management maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported within time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Ardagh Group S.A.’s controls and procedures are designed to provide reasonable assurance of achieving their objectives.
Management carried out an evaluation, under the supervision and with the participation of its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of December 31, 2019. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2019 so as to provide reasonable assurance that (1) information required to be disclosed by the Company in the reports that the Company files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and its Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.
There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.
|
B. |
|
Management’s annual report on internal control over financial reporting |
Management, under the supervision and with the participation of its Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over the Company’s financial reporting. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS as adopted by IASB and includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS as adopted by IASB, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the consolidated financial statements.
Management assessed the effectiveness of the Company’s internal control over financial reporting (as defined in Rules 13(a)-13(f) and 15(d)-15(f) under the U.S. Securities Exchange Act of 1934) as of December 31, 2019. In making this assessment, it used the criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our assessment, management concluded that, as of December 31, 2019, the Company’s internal control over financial reporting is effective based on those criteria.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Ardagh Group S.A.
101
PricewaterhouseCoopers, an independent registered public accounting firm, has issued an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting, which is included in this annual report under “Item 18. Financial Statements—Report of independent registered public accounting firm.”
|
C. |
|
Attestation report of the registered public accounting firm |
See the report of PricewaterhouseCoopers, an independent registered public accounting firm, included under “Item 18. Financial Statements—Report of independent registered public accounting firm.”
|
D. |
|
Changes in internal control over financial reporting |
During the period covered by this report, we have not made any changes to our internal controls over financial reporting that have materially, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 16A. Audit committee financial expert
Our board of directors has determined that Edward White is an “audit committee financial expert” as defined by the SEC item 16A of Form 20-F. All members of the audit committee are independent directors as defined in the NYSE corporate governance standards and Rule 10A-3 under the Exchange Act.
Our board of directors has adopted a code of conduct that establishes the standards of ethical conduct applicable to all of our directors, officers, employees, consultants and contractors. The code addresses, among other things, competition and fair dealing, conflicts of interest, financial matters and external reporting, compliance with applicable governmental laws, rules and regulations, company funds and assets, confidentiality and corporate opportunity requirements and the process for reporting violations of the code, employee misconduct, conflicts of interest or other violations. Any waiver of the code with respect to any director or executive officer will be promptly disclosed and posted on our website. Amendments to the code must be approved by our board of directors and will be promptly disclosed and posted on our website.
The code is publicly available on our website at https://www.ardaghgroup.com/corporate/investors and in print to any shareholder who requests a copy.
Ardagh Group S.A.
102
Item 16C. Principal Accountant Fees and Services
PricewaterhouseCoopers have acted as our principal accountants for the years ended December 31, 2019 and December 31, 2018.
The following table summarizes the total amounts charged for professional fees rendered in those periods:
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Year ended |
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|
|
December 31, |
||
|
|
2019 |
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2018 |
|
|
(in $ millions) |
||
Audit services fees |
|
8 |
|
8 |
Audit-related services fees |
|
2 |
|
1 |
Tax services fees |
|
1 |
|
1 |
Total |
|
11 |
|
10 |
Audit Services Fees
Audit services are defined as standard audit work that needs to be performed each year in order to issue opinions on our consolidated financial statements, to issue an attestation report on internal control required by Section 404 of the Sarbanes‑Oxley Act of 2002 and to issue reports on our local financial statements.
Audit-Related Services Fees
Audit-related fees include services such as auditing of non-recurring transactions, reviews of quarterly financial results, consents and comfort letters and any other audit services required for SEC or other regulatory filings.
Tax Services Fees
Tax services relate to the aggregated fees for services on tax compliance.
The Company’s audit committee approves all auditing services and permitted non-audit services performed for the Company by its independent auditor in advance of an engagement. All auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for the Company by its independent auditor must be approved by the Committee in advance, subject to the de minimis exceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act which are approved by the Committee prior to the completion of the audit.
All audit-related service fees and tax service fees were approved by the audit committee.
Item 16D. Exemptions from the Listing Standards for Audit Committees
No exemptions from the listing standards for our audit committee
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
Not applicable
Item 16F. Changes in Registrant’s Certifying Accountant
Not applicable
Ardagh Group S.A.
103
Item 16G. Corporate Governance
We are exempt from certain corporate governance requirements of the NYSE by virtue of being a “foreign private issuer.” Although our foreign private issuer status exempts us from most of the NYSE’s corporate governance requirements, we intend to voluntarily comply with these requirements, except those from which we would be exempt by virtue of being a “controlled company.” Our Parent Company controls, directly or indirectly, a majority of the voting power of our issued and outstanding shares and is a controlled company within the meaning of the NYSE corporate governance standards (pursuant to Section 303A of the NYSE’s Listed Company Manual), entitled to certain limited corporate governance exemptions. Under these NYSE standards, a company of which more than 50% of the voting power is held by another person or group of persons acting together is a controlled company and may elect not to comply with certain NYSE corporate governance requirements, including the requirements that:
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· |
|
a majority of the board of directors consist of independent directors; |
|
· |
|
the nominating and governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; |
|
· |
|
the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and |
|
· |
|
there be an annual performance evaluation of the nominating and corporate governance and compensation committees. |
As a controlled company, we utilize these exemptions, including the exemption from the requirement to have a board of directors composed of a majority of independent directors. In addition, although we have adopted charters for our audit, compensation and nominating and governance committees, our compensation and nominating and governance committees are not expected to be composed entirely of independent directors.
As a result of the foregoing exemptions, we can cease voluntary compliance at any time, and our shareholders may not have the same protections afforded to shareholders of companies that are subject to all of the NYSE corporate governance requirements.
Item 16H. Mine Safety Disclosure
Not applicable
See Item 18
See the Consolidated Financial Statements from F-1 – F-68.
Ardagh Group S.A.
104
The following exhibits are filed as part of this annual report:
Ardagh Group S.A.
105
99.5 |
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|
|
|
|
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99.6 |
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|
|
|
|
99.7 |
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|
|
|
|
|
|
101 |
|
Interactive Data Files (XBRL – Related Documents) |
|
|
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|
|
+ |
|
Certain identified information has been excluded from the exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed. Exhibits and schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K and will be supplementally provided to the SEC upon request. |
|
Ardagh Group S.A.
106
The registrant hereby certifies that it meets all the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
Date: February 27, 2020
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Ardagh Group S.A. |
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By: |
/s/ DAVID MATTHEWS |
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Name: |
David Matthews |
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|
Title: |
Chief Financial Officer |
|
Ardagh Group S.A.
107
INDEX TO THE FINANCIAL STATEMENTS
Ardagh Group S.A.
F-1
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of Ardagh Group S.A.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated statement of financial position of Ardagh Group S.A. and its subsidiaries (the “Company”) as of December 31, 2019 and 2018, and the related consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for each of the three years in the period ended December 31, 2019, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Change in Accounting Principle
As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for leases in 2019, the manner in which it accounts for revenues from contracts with customers in 2018 and the manner in which it accounts for financial instruments in 2018.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Annual Report on Internal Control over Financial Reporting appearing under Item 15 of Form 20-F. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control
Ardagh Group S.A.
F-2
over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/PricewaterhouseCoopers
Dublin, Ireland
February 20, 2020
We have served as the Company’s auditor since at least 1968, which includes periods before the Company became subject to SEC reporting requirements in 2017. We have not been able to determine the specific year we began serving as auditor of the Company or its predecessors.
Ardagh Group S.A.
F-3
ARDAGH GROUP S.A.
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|
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|
|
Year ended December 31, 2019 |
|
Year ended December 31, 2018 |
|
Year ended December 31, 2017 |
|||||||||||||||
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Before |
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Before |
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|
|
|
Before |
|
|
|
|
|
|
|
|
|
exceptional |
|
Exceptional |
|
|
|
|
exceptional |
|
Exceptional |
|
|
|
|
exceptional |
|
Exceptional |
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|
|
|
|
|
|
items |
|
Items |
|
Total |
|
items |
|
Items |
|
Total |
|
items |
|
Items |
|
Total |
|||
|
|
Note |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|||
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|
Note 4 |
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|
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|
Note 4 |
|
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|
Note 4 |
|
|
|
Revenue |
|
3 |
|
6,660 |
|
— |
|
|
6,660 |
|
6,676 |
|
— |
|
|
6,676 |
|
6,390 |
|
— |
|
|
6,390 |
Cost of sales |
|
|
|
(5,595) |
|
(2) |
|
|
(5,597) |
|
(5,623) |
|
(108) |
|
|
(5,731) |
|
(5,309) |
|
(78) |
|
|
(5,387) |
Gross profit |
|
|
|
1,065 |
|
(2) |
|
|
1,063 |
|
1,053 |
|
(108) |
|
|
945 |
|
1,081 |
|
(78) |
|
|
1,003 |
Sales, general and administration expenses |
|
|
|
(311) |
|
(51) |
|
|
(362) |
|
(300) |
|
(17) |
|
|
(317) |
|
(286) |
|
(45) |
|
|
(331) |
Intangible amortization and impairment |
|
9 |
|
(233) |
|
— |
|
|
(233) |
|
(237) |
|
(186) |
|
|
(423) |
|
(237) |
|
— |
|
|
(237) |
Operating profit |
|
|
|
521 |
|
(53) |
|
|
468 |
|
516 |
|
(311) |
|
|
205 |
|
558 |
|
(123) |
|
|
435 |
Net finance expense |
|
5 |
|
(456) |
|
(203) |
|
|
(659) |
|
(457) |
|
(22) |
|
|
(479) |
|
(506) |
|
(132) |
|
|
(638) |
Share of post-tax loss in equity accounted joint venture |
|
12 |
|
(10) |
|
(39) |
|
|
(49) |
|
— |
|
— |
|
|
— |
|
— |
|
— |
|
|
— |
Profit/(loss) before tax |
|
|
|
55 |
|
(295) |
|
|
(240) |
|
59 |
|
(333) |
|
|
(274) |
|
52 |
|
(255) |
|
|
(203) |
Income tax (charge)/credit |
|
6 |
|
(41) |
|
(3) |
|
|
(44) |
|
(67) |
|
49 |
|
|
(18) |
|
(47) |
|
124 |
|
|
77 |
Profit/(loss) from continuing operations |
|
|
|
14 |
|
(298) |
|
|
(284) |
|
(8) |
|
(284) |
|
|
(292) |
|
5 |
|
(131) |
|
|
(126) |
Profit from discontinued operation |
|
25 |
|
215 |
|
1,527 |
|
|
1,742 |
|
211 |
|
(13) |
|
|
198 |
|
201 |
|
(12) |
|
|
189 |
Profit/(loss) for the year |
|
|
|
229 |
|
1,229 |
|
|
1,458 |
|
203 |
|
(297) |
|
|
(94) |
|
206 |
|
(143) |
|
|
63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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Profit/(loss) attributable to: |
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|
Equity holders |
|
|
|
|
|
|
|
|
1,458 |
|
|
|
|
|
|
(94) |
|
|
|
|
|
|
63 |
Non-controlling interests |
|
|
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
Profit/(loss) for the year |
|
|
|
|
|
|
|
|
1,458 |
|
|
|
|
|
|
(94) |
|
|
|
|
|
|
63 |
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
Earnings/(loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings/(loss) for the year attributable to equity holders |
|
7 |
|
|
|
|
|
$ |
6.17 |
|
|
|
|
|
$ |
(0.40) |
|
|
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|
|
$ |
|
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|
Loss per share from continuing operations: |
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per share from continuing operations attributable to equity holders |
|
7 |
|
|
|
|
|
$ |
(1.20) |
|
|
|
|
|
$ |
(1.24) |
|
|
|
|
|
$ |
(0.55) |
The accompanying notes to the consolidated financial statements are an integral part of these consolidated financial statements.
Ardagh Group S.A.
F-4
ARDAGH GROUP S.A.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
|
|
2019 |
|
2018 |
|
2017 |
|
|
Note |
|
$'m |
|
$'m |
|
$'m |
|
|
|
|
|
|
|
|
|
Profit/(loss) for the year |
|
|
|
1,458 |
|
(94) |
|
63 |
|
|
|
|
|
|
|
|
|
Other comprehensive income/(expense): |
|
|
|
|
|
|
|
|
Items that may subsequently be reclassified to income statement |
|
|
|
|
|
|
|
|
Foreign currency translation adjustments: |
|
|
|
|
|
|
|
|
—Arising in the year |
|
|
|
47 |
|
75 |
|
(178) |
|
|
|
|
47 |
|
75 |
|
(178) |
Effective portion of changes in fair value of cash flow hedges: |
|
|
|
|
|
|
|
|
—New fair value adjustments into reserve |
|
|
|
54 |
|
54 |
|
(254) |
—Movement out of reserve to income statement |
|
|
|
(10) |
|
(73) |
|
258 |
—Movement in deferred tax |
|
|
|
1 |
|
5 |
|
1 |
|
|
|
|
45 |
|
(14) |
|
5 |
(Loss)/gain recognized on cost of hedging: |
|
|
|
|
|
|
|
|
—New fair value adjustments into reserve |
|
|
|
(8) |
|
15 |
|
— |
—Movement out of reserve |
|
|
|
(12) |
|
(2) |
|
— |
|
|
|
|
(20) |
|
13 |
|
— |
|
|
|
|
|
|
|
|
|
Share of other comprehensive income in equity accounted joint venture |
|
12 |
|
5 |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
Items that will not be reclassified to income statement |
|
|
|
|
|
|
|
|
—Re-measurement of employee benefit obligations |
|
21 |
|
(140) |
|
11 |
|
49 |
—Deferred tax movement on employee benefit obligations |
|
|
|
32 |
|
(1) |
|
(6) |
|
|
|
|
(108) |
|
10 |
|
43 |
|
|
|
|
|
|
|
|
|
Share of other comprehensive income in equity accounted joint venture |
|
12 |
|
2 |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
Total other comprehensive (expense)/income for the year |
|
|
|
(29) |
|
84 |
|
(130) |
|
|
|
|
|
|
|
|
|
Total comprehensive income/(expense) for the year |
|
|
|
1,429 |
|
(10) |
|
(67) |
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Equity holders |
|
|
|
1,429 |
|
(10) |
|
(67) |
Non-controlling interests |
|
|
|
— |
|
— |
|
— |
Total comprehensive income/(expense) for the year |
|
|
|
1,429 |
|
(10) |
|
(67) |
|
|
|
|
|
|
|
|
|
Attributable to equity holders: |
|
|
|
|
|
|
|
|
Continuing operations |
|
|
|
(312) |
|
(173) |
|
(370) |
Discontinued operation |
|
|
|
1,741 |
|
163 |
|
303 |
Total comprehensive income/(expense) for the year |
|
|
|
1,429 |
|
(10) |
|
(67) |
The accompanying notes to the consolidated financial statements are an integral part of these consolidated financial statements.
Ardagh Group S.A.
F-5
ARDAGH GROUP S.A.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
At December 31, |
||
|
|
|
|
2019 |
|
2018 |
|
|
Note |
|
$'m |
|
$'m |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
Intangible assets |
|
9 |
|
2,884 |
|
3,601 |
Property, plant and equipment |
|
10 |
|
2,677 |
|
3,388 |
Derivative financial instruments |
|
20 |
|
4 |
|
11 |
Deferred tax assets |
|
13 |
|
204 |
|
254 |
Investment in material joint venture |
|
12 |
|
375 |
|
— |
Other non-current assets |
|
11 |
|
68 |
|
24 |
|
|
|
|
6,212 |
|
7,278 |
Current assets |
|
|
|
|
|
|
Inventories |
|
14 |
|
964 |
|
1,284 |
Trade and other receivables |
|
15 |
|
734 |
|
1,053 |
Contract assets |
|
16 |
|
151 |
|
160 |
Derivative financial instruments |
|
20 |
|
3 |
|
9 |
Cash and cash equivalents |
|
17 |
|
614 |
|
530 |
|
|
|
|
2,466 |
|
3,036 |
TOTAL ASSETS |
|
|
|
8,678 |
|
10,314 |
|
|
|
|
|
|
|
Equity attributable to owners of the parent |
|
|
|
|
|
|
Issued capital |
|
18 |
|
23 |
|
23 |
Share premium |
|
|
|
1,292 |
|
1,292 |
Capital contribution |
|
|
|
485 |
|
485 |
Other reserves |
|
|
|
165 |
|
45 |
Retained earnings |
|
|
|
(2,181) |
|
(3,355) |
|
|
|
|
(216) |
|
(1,510) |
Non-controlling interests |
|
|
|
1 |
|
1 |
TOTAL EQUITY |
|
|
|
(215) |
|
(1,509) |
Non-current liabilities |
|
|
|
|
|
|
Borrowings |
|
20 |
|
5,524 |
|
7,729 |
Lease obligations |
|
20 |
|
291 |
|
32 |
Employee benefit obligations |
|
21 |
|
716 |
|
957 |
Derivative financial instruments |
|
20 |
|
44 |
|
107 |
Deferred tax liabilities |
|
13 |
|
344 |
|
543 |
Provisions |
|
22 |
|
29 |
|
38 |
|
|
|
|
6,948 |
|
9,406 |
Current liabilities |
|
|
|
|
|
|
Borrowings |
|
20 |
|
22 |
|
114 |
Lease obligations |
|
20 |
|
73 |
|
4 |
Interest payable |
|
|
|
60 |
|
81 |
Derivative financial instruments |
|
20 |
|
17 |
|
38 |
Trade and other payables |
|
23 |
|
1,628 |
|
1,983 |
Income tax payable |
|
|
|
97 |
|
114 |
Provisions |
|
22 |
|
48 |
|
83 |
|
|
|
|
1,945 |
|
2,417 |
TOTAL LIABILITIES |
|
|
|
8,893 |
|
11,823 |
TOTAL EQUITY and LIABILITIES |
|
|
|
8,678 |
|
10,314 |
The accompanying notes to the consolidated financial statements are an integral part of these consolidated financial statements.
Ardagh Group S.A.
F-6
ARDAGH GROUP S.A.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to the owner of the parent |
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
Foreign |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
currency |
|
Cash flow |
|
Cost of |
|
|
|
|
|
Non‑ |
|
|
|
|
Share |
|
Share |
|
Capital |
|
translation |
|
hedge |
|
hedging |
|
Retained |
|
|
|
controlling |
|
Total |
|
|
capital |
|
premium |
|
contribution |
|
reserve |
|
reserve |
|
reserve |
|
earnings |
|
Total |
|
interests |
|
equity |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
|
Note 18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2017 |
|
— |
|
274 |
|
485 |
|
189 |
|
(37) |
|
— |
|
(3,093) |
|
(2,182) |
|
3 |
|
(2,179) |
Profit for the year |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
63 |
|
63 |
|
— |
|
63 |
Other comprehensive (expense)/income |
|
— |
|
— |
|
— |
|
(178) |
|
5 |
|
— |
|
43 |
|
(130) |
|
— |
|
(130) |
Share re-organization (Note 18) |
|
23 |
|
(23) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
Share issuance (Note 18) |
|
— |
|
323 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
323 |
|
— |
|
323 |
Conversion of related party loan (Note 18) |
|
— |
|
716 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
716 |
|
— |
|
716 |
Dividends paid (Note 26) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(165) |
|
(165) |
|
— |
|
(165) |
Non-controlling interest in disposed business |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(2) |
|
(2) |
At December 31, 2017 |
|
23 |
|
1,290 |
|
485 |
|
11 |
|
(32) |
|
— |
|
(3,152) |
|
(1,375) |
|
1 |
|
(1,374) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2018 (i) |
|
23 |
|
1,290 |
|
485 |
|
11 |
|
(48) |
|
18 |
|
(3,139) |
|
(1,360) |
|
1 |
|
(1,359) |
Loss for the year |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(94) |
|
(94) |
|
— |
|
(94) |
Other comprehensive income/(expense) |
|
— |
|
— |
|
— |
|
75 |
|
(14) |
|
13 |
|
10 |
|
84 |
|
— |
|
84 |
Hedging gains transferred to cost of inventory |
|
— |
|
— |
|
— |
|
— |
|
(10) |
|
— |
|
— |
|
(10) |
|
— |
|
(10) |
Share issuance |
|
— |
|
2 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
2 |
|
— |
|
2 |
Dividends paid (Note 26) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(132) |
|
(132) |
|
— |
|
(132) |
At December 31, 2018 |
|
23 |
|
1,292 |
|
485 |
|
86 |
|
(72) |
|
31 |
|
(3,355) |
|
(1,510) |
|
1 |
|
(1,509) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2019 (ii) |
|
23 |
|
1,292 |
|
485 |
|
86 |
|
(72) |
|
31 |
|
(3,401) |
|
(1,556) |
|
1 |
|
(1,555) |
Profit for the year |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,458 |
|
1,458 |
|
— |
|
1,458 |
Other comprehensive income/(expense) |
|
— |
|
— |
|
— |
|
52 |
|
45 |
|
(20) |
|
(106) |
|
(29) |
|
— |
|
(29) |
Hedging losses transferred to cost of inventory |
|
— |
|
— |
|
— |
|
— |
|
16 |
|
— |
|
— |
|
16 |
|
— |
|
16 |
Recycle to income statement on disposal of subsidiary (Note 25) |
|
— |
|
— |
|
— |
|
27 |
|
— |
|
— |
|
— |
|
27 |
|
— |
|
27 |
Dividends paid (Note 26) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(132) |
|
(132) |
|
— |
|
(132) |
At December 31, 2019 |
|
23 |
|
1,292 |
|
485 |
|
165 |
|
(11) |
|
11 |
|
(2,181) |
|
(216) |
|
1 |
|
(215) |
The accompanying notes to the consolidated financial statements are an integral part of these consolidated financial statements.
(i) Retained earnings at January 1, 2018 were re-presented by $13 million reflecting $20 million in respect of the impact of the adoption of IFRS 15 “Revenue from contracts with customers”, partly offset by $7 million in respect of the adoption of IFRS 9 “Financial instruments”. Further, following the adoption of IFRS 9 “Financial instruments”, the cash flow hedge reserve was re-presented by $16 million, and cost of hedging reserve was re-presented to $18 million.
(ii) Retained earnings at January 1, 2019 have been re-presented by $46 million reflecting the impact of the adoption of IFRS 16 ‘Leases’. Please refer to Note 2 for further details in respect of the impact of this recently adopted accounting standard.
Ardagh Group S.A.
F-7
ARDAGH GROUP S.A.
CONSOLIDATED STATEMENT OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
|
|
2019 |
|
2018 |
|
2017 |
|
|
Note |
|
$'m |
|
$'m |
|
$'m |
|
|
|
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Cash generated from continuing operations |
|
24 |
|
1,179 |
|
991 |
|
1,185 |
Interest paid |
|
|
|
(417) |
|
(414) |
|
(458) |
Income tax paid |
|
|
|
(64) |
|
(97) |
|
(95) |
Net cash from operating activities - continuing operations |
|
|
|
698 |
|
480 |
|
632 |
Net cash from operating activities - discontinued operation (i) |
|
|
|
141 |
|
375 |
|
330 |
Net cash from operating activities |
|
|
|
839 |
|
855 |
|
962 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
|
|
(498) |
|
(465) |
|
(391) |
Purchase of intangible assets |
|
|
|
(10) |
|
(12) |
|
(13) |
Proceeds from disposal of property, plant and equipment |
|
|
|
3 |
|
10 |
|
4 |
Investing cash flows used in continuing operations |
|
|
|
(505) |
|
(467) |
|
(400) |
Proceeds from disposal of discontinued operation, net of cash disposed of |
|
|
|
2,539 |
|
— |
|
— |
Investing cash flows used in discontinued operation |
|
|
|
(107) |
|
(108) |
|
(92) |
Net cash from/(used in) investing activities |
|
|
|
1,927 |
|
(575) |
|
(492) |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Repayment of borrowings |
|
20 |
|
(4,088) |
|
(442) |
|
(4,384) |
Proceeds from borrowings |
|
20 |
|
1,806 |
|
110 |
|
3,730 |
Dividends paid |
|
26 |
|
(132) |
|
(132) |
|
(165) |
Consideration received/(paid) on extinguishment of derivative financial instruments |
|
20 |
|
9 |
|
(44) |
|
46 |
Deferred debt issue costs paid |
|
|
|
(14) |
|
(5) |
|
(38) |
Lease payments |
|
|
|
(78) |
|
(4) |
|
— |
Early redemption premium paid |
|
|
|
(165) |
|
(7) |
|
(91) |
Proceeds from share issuance |
|
|
|
— |
|
— |
|
326 |
Financing cash flows from continuing operations |
|
|
|
(2,662) |
|
(524) |
|
(576) |
Financing cash flows from discontinued operation |
|
|
|
– |
|
3 |
|
(1) |
Net cash outflow from financing activities |
|
|
|
(2,662) |
|
(521) |
|
(577) |
|
|
|
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents |
|
|
|
104 |
|
(241) |
|
(107) |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at the beginning of the year |
|
17 |
|
530 |
|
784 |
|
813 |
Exchange (losses)/gains on cash and cash equivalents |
|
|
|
(20) |
|
(13) |
|
78 |
Cash and cash equivalents at the end of the year |
|
17 |
|
614 |
|
530 |
|
784 |
The accompanying notes to the consolidated financial statements are an integral part of these consolidated financial statements.
(i) Operating cash flows for discontinued operation for the year ended December 31, 2019, include interest and income tax payments of $6 million and $15 million respectively (2018: $2 million and $8 million, 2017: $nil and $8 million).
Ardagh Group S.A.
F-8
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. General information
Ardagh Group S.A. (the “Company”) was incorporated in Luxembourg on May 6, 2011. The Company’s registered office is 56, rue Charles Martel, L‑2134 Luxembourg, Luxembourg.
On March 20, 2017, the Company closed its initial public offering (“IPO”) of 18,630,000 Class A common shares on the New York Stock Exchange (“NYSE”).
Ardagh Group S.A. and its subsidiaries (together the “Group” or “Ardagh”) is a leading supplier of sustainable innovative, value‑added rigid packaging solutions. The Group’s products include metal beverage cans, as well as glass containers primarily for beverage and food markets. End‑use categories include beer, wine, spirits, carbonated soft drinks, energy drinks, juices and water, as well as food and pharmaceuticals. Ardagh also holds a stake of approximately 42% in Trivium Packaging B.V. (“Trivium”), a leading supplier of metal packaging in the form of cans and aerosol containers, serving a broad range of end-use categories, principally including food, seafood, pet food and nutrition, as well as beauty and personal care.
These consolidated financial statements reflect the consolidation of the legal entities forming the Group for the periods presented. The principal operating legal entities forming the Group are listed in Note 27.
The principal accounting policies that have been applied to the consolidated financial statements are described in Note 2.
2. Summary of significant accounting policies
Basis of preparation
The consolidated financial statements of the Group have been prepared in accordance with, and are in compliance with, International Financial Reporting Standards (“IFRS”) and related interpretations as adopted by the International Accounting Standards Board (“IASB”). IFRS is comprised of standards and interpretations approved by the IASB and IFRS and interpretations approved by the predecessor International Accounting Standards Committee that have been subsequently approved by the IASB and remain in effect. References to IFRS hereafter should be construed as references to IFRS as adopted by the IASB.
On October 31, 2019, the Group completed the combination of its Food & Specialty Metal Packaging business (“Food & Specialty”), operating as part of the Metal Packaging Europe and Metal Packaging Americas segments, with the business of Exal Corporation (“Exal”), to form Trivium, a global leader in metal packaging. As consideration, Ardagh received a stake of approximately 42% in Trivium and approximately $2.6 billion in cash proceeds, subject to customary completion adjustments. The remaining approximate 58% is held by Ontario Teachers’ Pension Plan Board (“Ontario Teachers”). Trivium is jointly controlled by Ardagh Group S.A. and Ontario Teachers. As a result of the completion of the transaction, Food & Specialty has been reported as a discontinued operation for the ten months period ended October 31, 2019 and previous years have been re-presented accordingly. Consequently, the Group’s segments have been updated. Please refer to note 3, Segment analysis, for further details.
The consolidated financial statements, are presented in U.S. dollar, rounded to the nearest million and have been prepared under the historical cost convention except for the following:
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· |
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derivative financial instruments are stated at fair value; and |
Ardagh Group S.A.
F-9
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· |
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employee benefit obligations are measured at the present value of the future estimated cash flows related to benefits earned and pension assets valued at fair value. |
The preparation of consolidated financial information in conformity with IFRS requires the use of critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and income and expenses. It also requires management to exercise judgment in the process of applying Group accounting policies. These estimates, assumptions and judgments are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances and are subject to continual re‑evaluation. However, actual outcomes may differ from these estimates. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are discussed in the critical accounting estimates, assumptions and judgments.
The consolidated financial statements for the Group were authorized for issue by the board of directors of Ardagh Group S.A. (the “Board”) on February 19, 2020.
Recently adopted accounting standards and changes in accounting policies
IFRS 16, ‘Leases’ (“IFRS 16”) sets out the principles for the recognition, measurement, presentation and disclosure of leases. The objective is to ensure that lessees and lessors provide relevant information in a manner that appropriately represents those transactions. This information provides a basis for users of financial statements to assess the effect that leases have on the financial position, financial performance and cash flows of the entity. IFRS 16 replaces IAS 17, ‘Leases’ (“IAS 17”), and later interpretations including IFRIC 4, ‘Determining whether an Arrangement contains a Lease’ (“IFRIC 4”), and has resulted in the majority of the Group’s operating leases being recognized on the consolidated statement of financial position. Under IFRS 16, at the lease commencement date the Group recognizes a lease liability as the present value of expected future lease payments, excluding any amounts which are variable based on the usage of the underlying asset and a right-of-use asset generally at the same amount plus any directly attributable costs.
The Group adopted IFRS 16 effective January 1, 2019 applying the simplified approach, with the right-of-use assets being calculated as if IFRS 16 had always been applied and the lease liabilities being calculated as the present value of expected remaining future lease payments, discounted at the Group’s incremental borrowing rate as at January 1, 2019, which resulted in the Group retaining prior period figures as reported under the previous standards and recognizing the cumulative effect of applying IFRS 16 as an adjustment to retained earnings as at the date of initial adoption. Upon adoption, the Group has availed of the practical expedients to use hindsight in determining the lease term where the contract contains options to extend or terminate the lease and has also elected not to apply IFRS 16 to contracts that were not identified before as containing a lease under IAS 17 and IFRIC 4. The Group has made an accounting policy election to combine lease and non-lease components.
The Group has completed its assessment of the impact of and subsequently adopted IFRS 16. This involved the establishment of a cross-functional project team to implement the new standard. The Group has gathered and assessed the data relating to approximately 2,000 leases to which the Group is party to and have designed and implemented a system solution and business process, with appropriate internal controls applied, in order to meet the new accounting and disclosure requirements post-adoption. The Group leases various types of assets, with lease terms being negotiated on an individual basis and subject to a wide range of different terms and conditions. Extension options or periods after termination options have been considered by management if it is reasonably certain that the lease will be extended or not terminated.
The principal impact on the consolidated statement of financial position as at the adoption date of January 1, 2019, was an increase in property, plant and equipment of $290 million due to the recognition of right-of-use assets, and an increase in borrowings of $349 million, as lease liabilities were recognized based on the new treatment. As a result of the aforementioned impact, deferred tax assets increased by $13 million.
Ardagh Group S.A.
F-10
Net cash from continuing operations for the year ended December 31, 2019 decreased by $74 million due to certain lease expenses no longer being recognized as operating cash outflows following the adoption of IFRS 16, however this is offset by a corresponding increase in cash used in financing activities due to repayments of the principal on lease liabilities.
In addition to the above impact, the adoption of IFRS 16 also had an impact on the consolidated income statement and certain of the Group’s key financial metrics as a result of changes in the classification of charges recognized in the consolidated income statement. The application of the new standard decreased both cost of sales and operating costs (excluding depreciation) in the income statement, giving rise to an increase in Adjusted EBITDA of the continuing operations for the year ended December 31, 2019 of $83 million of which $63 million is related to such leases recognized as part of the initial adoption of IFRS 16, offset by increases in depreciation and net finance expense. Please refer to Note 3 for the reconciliation of Adjusted EBITDA.
The weighted average lessee’s incremental borrowing rate applied to the lease liabilities recognized upon adoption of IFRS 16 was 5.4%. The total lease liability recognized at January 1, 2019 reconciles as follows to the total commitments under non-cancellable operating leases disclosed by the Group as of December 31, 2018:
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$'m |
Total commitments under non-cancellable operating leases as of December 31, 2018 |
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Different treatment of extension and termination options and non-lease components |
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Impact from discounting |
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Lease liabilities due to initial adoption of IFRS 16 as of January 1, 2019 |
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Finance lease obligations as of December 31, 2018 |
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Total lease liabilities as of January 1, 2019 |
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During 2019, the continuing operations of the Group incurred variable lease expense of $67 million, primarily related to warehouse leases.
Please refer to Notes 5, 10 and 20 for further information related to the Group’s leasing obligations.
IFRIC 23 – Uncertainty over income tax treatments
The IFRS Interpretations Committee issued IFRIC 23 ‘Uncertainty over income tax treatments’ (“IFRIC 23”), which clarifies how the recognition and measurement requirements of IAS 12 ‘Income taxes’ are applied where there is uncertainty over income tax treatments.
The Group applied IFRIC 23 on its mandatory adoption date of January 1, 2019. The application of this interpretation did not have a material impact on the consolidated financial statements of the Group.
Recent accounting pronouncements
The impact of new standards, amendments to existing standards and interpretations issued and effective for annual periods beginning on or after January 1, 2019 have been assessed by the Board and, with the exception of those identified above, no new standards or amendments to existing standards effective January 1, 2019 are currently relevant for the Group. The Board’s assessment of the impact of new standards, which are not yet effective and which have not been early adopted by the Group, on the consolidated financial statements and disclosures is on-going.
Ardagh Group S.A.
F-11
Basis of consolidation
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(i) |
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Subsidiaries |
Subsidiaries are fully consolidated from the date on which control is transferred to the Group and are de‑consolidated from the date on which control ceases. Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity.
The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is the consideration given in exchange for control of the identifiable assets, liabilities and contingent liabilities of the acquired legal entities. Directly attributable transaction costs are expensed and included as exceptional items within sales, general and administration expenses. The acquired net assets are initially measured at fair value. The excess of the cost of acquisition over the fair value of the identifiable net assets acquired is recorded as goodwill. Any goodwill and fair value adjustments are recorded as assets and liabilities of the acquired legal entity in the currency of the primary economic environment in which the legal entity operates (the “functional currency”). If the cost of acquisition is less than the fair value of the Group’s share of the net assets of the legal entity acquired, the difference is recognized directly in the consolidated income statement. The Group considers obligations of the acquiree in a business combination that arise as a result of the change in control, to be cash flows arising from obtaining control of the controlled entity, and classifies these obligations as investing activities in the consolidated statement of cash flows.
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(ii) |
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Non-controlling interests |
Non-controlling interests represent the portion of the equity of a subsidiary which is not attributable to the Group. Non-controlling interests are presented separately in the consolidated financial statements. Changes in ownership of a subsidiary which do not result in a change in control are treated as equity transactions.
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(iii) |
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Transactions eliminated on consolidation |
Transactions, balances and unrealized gains or losses on transactions between Group companies are eliminated. Subsidiaries’ accounting policies have been changed where necessary to ensure consistency with the policies adopted by the Group.
Foreign currency
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(i) |
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Functional and presentation currency |
The functional currency of the Company is euro. The consolidated financial statements are presented in U.S. dollar which is the Group’s presentation currency.
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(ii) |
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Foreign currency transactions |
Items included in the financial statements of each of the Group’s entities are measured using the functional currency of that entity.
Transactions in foreign currencies are translated into the functional currency at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognized in the consolidated income statement, except: (i) differences on foreign currency borrowings that provide an effective hedge against a net investment in a foreign entity (“net investment hedges”), which are taken to other comprehensive income until the disposal of the net investment, at which time they are recognized in the consolidated
Ardagh Group S.A.
F-12
income statement; and (ii) differences on certain derivative financial instruments discussed under “Derivative financial instruments” below. Net investment hedges are accounted for in a similar manner to cash flow hedges. The gain or loss relating to the ineffective portion of a net investment hedge is recognized immediately in the consolidated income statement within finance income or expense.
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(iii) |
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Financial statements of foreign operations |
The assets and liabilities of foreign operations are translated into euro at foreign exchange rates ruling at the reporting date. The revenues and expenses of foreign operations are translated to euro at average exchange rates for the year. Foreign exchange differences arising on retranslation and settlement of such transactions are recognized in other comprehensive income. Gains or losses accumulated in other comprehensive income are recycled to the consolidated income statement when the foreign operation is disposed of.
Non‑monetary items measured at fair value in foreign currency are translated using the exchange rates as at the date when the fair value is determined.
Business combinations and goodwill
All business combinations are accounted for by applying the acquisition method of accounting. This involves measuring the cost of the business combination and allocating, at the acquisition date, the cost of the business combination to the assets acquired and liabilities assumed. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.
The cost of an acquisition is measured as the aggregate of the consideration transferred, which is measured at acquisition date fair value, and the amount of any non‑controlling interests in the acquiree. For each business combination, the Group elects whether to measure the non‑controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition‑related costs are expensed as incurred and included in sales, general and administration expenses.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.
Any contingent consideration is recognized at fair value at the acquisition date.
Goodwill represents the excess of the cost of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to those groups of cash‑generating units (“CGUs”) that are expected to benefit from the business combination in which the goodwill arose for the purpose of assessing impairment. Goodwill is tested annually for impairment.
Where goodwill has been allocated to a CGU and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash‑generating unit retained.
Joint ventures
The Group participates in a number of joint ventures where control is shared with one or more other parties. The Group’s investment and share of results of joint ventures are shown within single line items in the consolidated statement
Ardagh Group S.A.
F-13
of financial position and consolidated income statement respectively. The Group uses the equity method of accounting to account for its joint ventures. See note 12 “Investment in material joint venture” to the consolidated financial statements.
Discontinued Operations
A discontinued operation is a component of the Group’s business that represents a separate major line of the business, geographical area of operations or is material to revenue or operating profit and has been disposed of or is held for sale. When an operation is classified as a discontinued operation, the comparative income statement is restated as if the operation had been discontinued from the start of the earliest period presented. Cash flows relating to discontinued operations are presented as a separate line item within each of the operating, investing and financing cash flow.
Intangible assets
Intangible assets are initially recognized at cost.
Intangible assets acquired as part of a business combination are capitalized separately from goodwill if the intangible asset is separable or arises from contractual or other legal rights. They are initially recognized at cost which, for intangible assets arising in a business combination, is their fair value at the date of acquisition.
Subsequent to initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses. The carrying values of intangible assets with finite useful lives are reviewed for indicators of impairment at each reporting date and are subject to impairment testing when events or changes in circumstances indicate that the carrying values may not be recoverable.
The amortization of intangible assets is calculated to write off the book value of finite lived intangible assets over their useful lives on a straight‑line basis on the assumption of zero residual value as follows:
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Computer software |
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2 |
- |
7 |
years |
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Customer relationships |
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5 |
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15 |
years |
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Technology |
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8 |
- |
15 |
years |
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(i) |
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Computer software |
Computer software development costs are recognized as assets. Costs associated with maintaining computer software programs are recognized as an expense as incurred.
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(ii) |
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Customer relationships |
Customer relationships acquired in a business combination are recognized at fair value at the acquisition date. Customer relationships have a finite useful economic life and are carried at cost less accumulated amortization.
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(iii) |
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Technology |
Technology based intangibles acquired in a business combination are recognized at fair value at the acquisition date and reflect the Group’s ability to add value through accumulated technological expertise surrounding product and process development.
Ardagh Group S.A.
F-14
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(iv) |
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Research and development costs |
Research costs are expensed as incurred. Development costs relating to new products are capitalized if the new product is technically and commercially feasible. All other development costs are expensed as incurred.
Property, plant and equipment
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(i) |
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Owned assets |
Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, except for land which is shown at cost less impairment. Spare parts which form an integral part of plant and machinery and which have an estimated useful economic life greater than one year are capitalized. Spare parts which do not form an integral part of plant and machinery and which have an estimated useful economic life less than one year are included as consumables within inventory and expensed when utilized.
Where components of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.
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(ii) |
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Leased assets |
Effective January 1, 2019 on adoption of IFRS 16
At the lease commencement date or the effective date of a lease modification, the Group recognizes a lease liability as the present value of expected future lease payments, discounted at the Group’s incremental borrowing rate unless the rate implicit in the lease is readily determinable, excluding any amounts which are variable based on the usage of the underlying asset and a right-of-use asset generally at the same amount plus any directly attributable costs. The Group combines lease and non-lease components and accounts for them as a single lease component. Extension options or periods after termination options are considered by management if it is reasonably certain that the lease will be extended or not terminated.
Effective prior to adoption of IFRS 16 on January 1, 2019
The determination of whether an arrangement is, or contains a lease, is based on the substance of the arrangement and requires an assessment of whether the fulfillment of the arrangement is dependent on the use of a specific asset or assets, and the arrangement conveys a right to use the asset.
Leases of property, plant and equipment where the Group has substantially all the risks and rewards of ownership are classified as finance leases.
Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the consolidated income statement on a straight‑line basis over the period of the lease.
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(iii) |
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Subsequent costs |
The Group recognizes in the carrying amount of an item of property, plant and equipment, the cost of replacing the component of such an item when that cost is incurred, if it is probable that the future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. When a component is replaced the old component is de‑recognized in the period. All other costs are recognized in the consolidated income statement as an expense as incurred. When a major overhaul is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria above are met.
Ardagh Group S.A.
F-15
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(iv) |
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Depreciation |
Depreciation is charged to the consolidated income statement on a straight‑line basis over the estimated useful lives of each part of an item of property, plant and equipment. Land is not depreciated. The estimated useful lives are as follows:
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Buildings |
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30 |
- |
40 |
years |
Plant and machinery |
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3 |
- |
40 |
years |
Molds |
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2 |
- |
3 |
years |
Office equipment and vehicles |
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3 |
- |
10 |
years |
Assets’ useful lives and residual values are adjusted if appropriate, at each balance sheet date.
Impairment of non‑financial assets
Assets that have an indefinite useful economic life are not subject to amortization and are tested annually for impairment or whenever indicators suggest that impairment may have occurred. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount.
For the purposes of assessing impairment, assets excluding goodwill and long lived intangible assets, are grouped at the lowest levels at which cash flows are separately identifiable. Goodwill and long lived intangible assets are allocated to groups of CGUs. The groupings represent the lowest level at which the related assets are monitored for internal management purposes.
Non‑financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.
The recoverable amount of other assets is the greater of their value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value, using a pre‑tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the CGU to which the asset belongs.
Inventories
Inventories are measured at the lower of cost and net realizable value. The cost of inventories is based on the first‑in, first‑out basis and includes expenditure incurred in acquiring the inventories and bringing them to their current location and condition. In the case of finished goods and work‑in‑progress, cost includes direct materials, direct labor and attributable overheads based on normal operating capacity.
Net realizable value is the estimated proceeds of sale less all further costs to completion, and less all costs to be incurred in marketing, selling and distribution.
Spare parts which are deemed to be of a consumable nature, are included within inventories and expensed when utilized.
Ardagh Group S.A.
F-16
Non‑derivative financial instruments
Non‑derivative financial instruments comprise trade and other receivables, cash and cash equivalents, borrowings and trade and other payables. Non‑derivative financial instruments are recognized initially at fair value plus any directly attributable transaction costs, except as described below. Subsequent to initial recognition, non‑derivative financial instruments are measured as described below.
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(i) |
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Trade and other receivables |
Effective January 1, 2018 on adoption of IFRS 9
Trade and other receivables are recognized initially at fair value and are thereafter measured at amortized cost using the effective interest rate method less any provision for impairment, in accordance with the Group’s held to collect business model. A provision for impairment of specific trade receivables is recognized when there is evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. For all other trade receivables, the Group will use an allowance matrix to measure the expected credit loss, based on historical actual credit loss experiences, adjusted for forward-looking information.
Effective prior to adoption of IFRS 9 on January 1, 2018
Trade and other receivables are recognized initially at fair value and are thereafter measured at amortized cost using the effective interest rate method, less any provision for impairment. A provision for impairment of trade receivables is recognized when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables.
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(ii) |
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Securitized assets |
The Group has entered into securitization transactions involving certain of its trade receivables. The securitized assets are recognized on the consolidated statement of financial position, until all of the rights to the cash flows from those assets have expired or have been fully transferred outside the Group, or until substantially all of the related risks, rewards and control of the related assets have been transferred to a third party.
The Group has also entered into a Global Asset Based Loan Facility (“ABL”) involving certain of its trade receivables and inventory. The lenders under the ABL have security over those receivables, inventory and the bank accounts where the associated cash flows are received. The risks, rewards and control of these assets are still retained by the Group and are, therefore, recognized on the statement of financial position.
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(iii) |
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Contract assets |
Contract assets represent revenue required to be accelerated or recognized over time based on production completed in accordance with the Group’s revenue recognition policy (as set out below). A provision for impairment of a contract asset will be recognized when there is evidence that the revenue recognized will not be recoverable. The provision is measured based on an allowance matrix to measure the expected credit loss, based on historical actual credit loss experiences, adjusted for forward-looking information.
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(iv) |
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Cash and cash equivalents |
Cash and cash equivalents include cash on hand and call deposits held with banks and restricted cash. Cash and cash equivalents are carried at amortized cost.
Ardagh Group S.A.
F-17
Short term bank deposits of greater than three months’ maturity which do not meet the definition of cash and cash equivalents are classified as financial assets within current assets and stated at amortized cost.
Restricted cash comprises cash held by the Group but which is ring‑fenced or used as security for specific financing arrangements, and to which the Group does not have unfettered access. Restricted cash is measured at amortized cost.
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(v) |
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Borrowings |
Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the Group’s consolidated income statement over the period of the borrowings using the effective interest rate method.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
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(vi) |
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Trade and other payables |
Trade and other payables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest rate method.
Derivative financial instruments
Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re‑measured at their fair value. The method of recognizing the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.
The fair values of various derivative instruments used for hedging purposes are disclosed in Note 20. The full fair value of a hedging derivative is classified as a non‑current asset or liability when the remaining maturity of the hedged item is more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. Trading derivatives are classified as a current asset or liability.
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(i) |
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Cash flow hedges |
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognized in other comprehensive income, allocated between cash flow hedge gains or losses and cost of hedging gains or losses. For cash flow hedges which subsequently result in the recognition of a non-financial asset, the amounts accumulated in the cash flow hedge reserve are reclassified to the asset in order to adjust its carrying value. Amounts accumulated in the cash flow hedge reserve and cost of hedging reserve, or as adjustments to carrying value of non-financial assets, are recycled to the consolidated income statement in the periods when the hedged item will affect profit or loss.
The gain or loss relating to the ineffective portion is recognized immediately in the consolidated income statement. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing at that time remains in equity and is recognized in the consolidated income statement when the forecast cash flow arises. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the consolidated income statement.
Ardagh Group S.A.
F-18
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(ii) |
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Net investment hedges |
Derivative financial instruments are classified as net investment hedges when they hedge changes in the Group’s net investments in its subsidiaries due to exposure to foreign currency. Net investment hedges are accounted for in a similar manner to cash flow hedges.
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(iii) |
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Fair value hedges |
Derivative financial instruments are classified as fair value hedges when they hedge the Group’s exposure to changes in the fair value of a recognized asset or liability. Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the Group’s consolidated income statement, together with any changes in the fair value of the hedged item that is attributable to the hedged risk. Changes in the fair value of derivatives relating to the cost of hedging are recognized in other comprehensive income.
The gain or loss relating to the effective portion of derivatives with fair value hedge accounting is recognized in the consolidated income statement within “net finance expense”. The gain or loss relating to the ineffective portion is also recognized in the consolidated income statement within “net finance expense”. If a hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest rate method is used is amortized to profit or loss over the period to maturity.
When a hedging instrument expires or is sold, or when a fair value hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing at that time remains in equity and is recognized in the consolidated income statement when the forecast cash flow arises. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the consolidated income statement.
Fair value measurement
The Group measures financial instruments such as derivatives and pension assets at fair value at each balance sheet date. Fair value related disclosures for financial instruments and pension assets that are measured at fair value or where fair values are disclosed, are summarized in the following notes:
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· |
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Disclosures for valuation methods, significant estimates and assumptions (Notes 20 and 21) |
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· |
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Quantitative disclosures of fair value measurement hierarchy (Note 20) |
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· |
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Financial instruments (including those carried at amortized cost) (Note 20) |
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
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· |
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in the principal market for the asset or liability; or |
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· |
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in the absence of a principal market, in the most advantageous market for the asset or liability. |
The principal or the most advantageous market must be accessible by the Group.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
Ardagh Group S.A.
F-19
A fair value measurement of a non‑financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
Employee benefits
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(i) |
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Defined benefit pension plans |
Typically, defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.
The liability recognized in the consolidated statement of financial position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the reporting date less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity in other comprehensive income in the period in which they arise. Past service costs are recognized immediately in the consolidated income statement.
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(ii) |
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Multi‑employer pension plans |
Multi‑employer craft or industry based pension schemes (“multi‑employer schemes”) have arrangements similar to those of defined benefit schemes. In each case it is not possible to identify the Group’s share of the underlying assets and liabilities of the multi‑employer schemes and therefore in accordance with IAS 19(R), the Group has taken the exemption for multi‑employer pension schemes to account for them as defined contribution schemes recognizing the contributions payable in each period in the consolidated income statement.
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(iii) |
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Other long term employee benefits |
The Group’s obligation in respect of other long term employee benefit plans represents the amount of future benefit that employees have earned in return for service in the current and prior periods for post‑retirement medical schemes, partial retirement contracts and long service awards. These are included in the category of employee benefit obligations on the consolidated statement of financial position. The obligation is computed on the basis of the projected unit credit method and is discounted to present value using a discount rate equating to the market yield at the reporting date on high quality corporate bonds of a currency and term consistent with the currency and estimated term of the obligations. Actuarial gains and losses are recognized in full in the Group’s consolidated statement of comprehensive income in the period in which they arise.
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(iv) |
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Defined contribution plans |
A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. The contributions are recognized as employee benefit expense when they are due.
Ardagh Group S.A.
F-20
Provisions
Provisions are recognized when the Group has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and the amount can be reliably estimated.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre‑tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.
Revenue recognition
Effective January 1, 2018 on adoption of IFRS 15
Our products include metal and glass containers primarily for food and beverage markets. consumer-driven demand. In addition to metal containers, within the Metal Beverage Europe and Metal Beverage Americas reportable segments, the Group manufactures and supplies a wide range of can ends. Containers and ends are usually distinct items and can be sold separately from each other. A significant portion of our sales volumes are supplied under contracts which include input cost pass-through provisions.
The Group usually enters into framework agreements with its customers, which establish the terms under which individual orders to purchase goods or services may be placed. As the framework agreements do not identify each party’s rights regarding the goods or services to be transferred, they do not create enforceable rights and obligations on a stand-alone basis. Therefore, the Group has concluded that only individual purchase orders create enforceable rights and obligations and meet the definition of a contract in IFRS 15. The individual purchase orders have, in general, a duration of one year or less and, as such, the Group does not disclose any information about remaining performance obligations under these contracts. The Group’s payment terms are in line with customary business practice, which can vary by customer and region. The Group has availed of the practical expedient from considering the existence of a significant financing component as, based on past experience, we expect that, at contract inception, the period between when a promised good is transferred to the customer and when the customer pays for that good will be one year or less.
Revenue is recognized when control of a good or service has transferred to the customer. For certain contracts in the Metal Beverage Europe and Metal Beverage Americas reportable segment, the Group manufactures products for customers that have no alternative use and for which the Group has an enforceable right to payment for production completed to date. Therefore, the Group will recognize revenue over time such that a portion of revenue, net of any related estimated rebates and cash discounts, excluding sales or value added tax, will be recognized prior to the dispatch of goods as the Group satisfies the contractual performance obligations for those contracts. For all other contracts, the Group will continue to recognize revenue primarily on dispatch of the goods, net of any related customer rebates and cash discounts, excluding sales and value added taxes.
Effective prior to adoption of IFRS 15 on January 1, 2018
Revenue from the sale of goods is recognized in the consolidated income statement when the significant risks and rewards of ownership have been transferred to the buyer, primarily on dispatch of the goods. Allowances for customer rebates are provided for in the same period as the related revenues are recorded. Revenue is presented net of such rebates as well as cash discounts and value added tax.
Exceptional items
The Group’s consolidated income statement, cash flow and segmental analysis separately identify results before specific items. Specific items are those that in management’s judgment need to be disclosed by virtue of their size, nature
Ardagh Group S.A.
F-21
or incidence to provide additional information. Such items include, where significant, restructuring, redundancy and other costs relating to permanent capacity realignment or footprint reorganization, directly attributable acquisition costs and acquisition integration costs, and other transaction-related costs, profit or loss on disposal or termination of operations, start‑up costs incurred in relation to and associated with plant builds, significant new line investments or furnaces, major litigation costs and settlements and impairments of non‑current assets. In this regard the determination of “significant” as included in our definition uses qualitative and quantitative factors. Judgment is used by the Group in assessing the particular items, which by virtue of their scale and nature, are disclosed in the Group’s consolidated income statement, and related notes as exceptional items. Management considers columnar presentation to be appropriate in the consolidated income statement as it provides useful additional information and is consistent with the way that financial performance is measured by management and presented to the Board. Exceptional restructuring costs are classified as restructuring provisions and all other exceptional costs when outstanding at the balance sheet date are classified as exceptional items payable.
Finance income and expense
Finance income comprises interest income on funds invested, gains on disposal of financial assets, ineffective portions of derivative instruments designated as hedging instruments and gains on derivative instruments that are not designated as hedging instruments and are recognized in profit or loss.
Finance expense comprises interest expense on borrowings (including amortization of deferred debt issuance costs), finance lease expenses, certain net foreign currency translation related to financing, net interest cost on net pension plan liabilities, losses on extinguishment of borrowings, ineffective portions of derivative instruments designated as hedging instruments, losses on derivative instruments that are not designated as hedging instruments and are recognized in profit or loss, and other finance expense.
The Group capitalizes borrowing costs directly attributable to the acquisition, construction or production of manufacturing plants that require a substantial period of time to build that would have been avoided if the expenditure on the qualifying asset had not been made.
Costs related to the issuance of new debt are deferred and amortized within finance expense over the expected terms of the related debt agreements by using the effective interest rate method.
Income tax
Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognized in the consolidated income statement except to the extent that it relates to items recognized in other comprehensive income.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date and any adjustment to tax payable in respect of previous years.
Deferred income tax is recognized, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are generally not recognized if they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.
Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except for deferred income tax liability where the timing
Ardagh Group S.A.
F-22
of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.
Segment reporting
The Board has been identified as the Chief Operating Decision Maker (“CODM”) for the Group.
Operating segments are identified on the basis of the internal reporting provided to the Board in order to allocate resources to the segment and assess its performance.
Critical accounting estimates, assumptions and judgments
Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
|
(i) |
|
Estimated impairment of goodwill and other long lived assets |
In accordance with IAS 36 “Impairment of assets” (“IAS 36”), the Group tests whether goodwill and other long lived assets have suffered any impairment in accordance with the accounting policies stated. The determination of the recoverable amounts of goodwill requires the use of estimates as outlined in Note 9. The Group’s judgments relating to the impairment of goodwill and other long lived assets are included in Notes 9 and 10.
|
(ii) |
|
Establishing lives for the purposes of depreciation and amortization of property, plant and equipment and intangibles |
Long lived assets, consisting primarily of property, plant and equipment, customer intangibles and technology intangibles, comprise a significant portion of the Group’s total assets. The annual depreciation and amortization charges depend primarily on the estimated lives of each type of asset and, in certain circumstances, estimates of fair values and residual values. The Board regularly review these asset lives and change them as necessary to reflect current thinking on remaining lives in light of technological change, prospective economic utilization and physical condition of the assets concerned. Changes in asset lives can have a significant impact on the depreciation and amortization charges for the period. It is not practical to quantify the impact of changes in asset lives on an overall basis, as asset lives are individually determined and there are a significant number of asset lives in use.
|
(iii) |
|
Lease term |
Several lease agreements include renewal and termination options. The Group assesses all facts and circumstances that create an economic incentive to exercise a renewal option, or not exercise a termination option. Renewal options (or periods after termination options) are only included in the lease term if the conclusion is that the lease is reasonably certain to be renewed (or not terminated). The lease term is reassessed if an option is actually exercised (or not exercised) or the Group becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the Group.
Ardagh Group S.A.
F-23
|
(iv) |
|
Income taxes |
The Group is subject to income taxes in numerous jurisdictions and judgment is therefore required in determining the worldwide provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognizes liabilities for anticipated tax audit matters based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.
|
(v) |
|
Measurement of employee benefit obligations |
The Group follows guidance of IAS 19(R) to determine the present value of its obligations to current and past employees in respect of defined benefit pension obligations, other long term employee benefits, and other end of service employee benefits which are subject to similar fluctuations in value in the long term. The Group values its liabilities, with the assistance of professional actuaries, to ensure consistency in the quality of the key assumptions underlying the valuations. The critical assumptions and estimates applied are discussed in detail in Note 21.
|
(vi) |
|
Exceptional items |
The consolidated income statement and segment analysis separately identify results before exceptional items. Exceptional items are those that in our judgment need to be disclosed by virtue of their size, nature or incidence.
The Group believes that this presentation provides additional analysis as it highlights exceptional items. The determination of “significant” as included in our definition uses qualitative and quantitative factors which remain consistent from period to period. Management uses judgment in assessing the particular items, which by virtue of their scale and nature, are disclosed in the consolidated income statement and related notes as exceptional items. Management considers the consolidated income statement presentation of exceptional items to be appropriate as it provides useful additional information and is consistent with the way that financial information is measured by management and presented to the Board. In that regard, management believes it to be consistent with paragraph 85 of IAS 1 “Presentation of financial statements” (“IAS 1”), which permits the inclusion of line items and subtotals that improve the understanding of performance.
Revenue is recognized when control of a good or service has transferred to the customer. For certain contracts, the Group manufactures products for customers that have no alternative use and for which the Group has an enforceable right to payment for production completed to date. The determination of goods or contracts having no alternative use and the enforceable right to payment involves and relies upon management judgment, and can result in the Group accelerating the recognition of revenue over time as the Group satisfies the contractual performance obligations for those contracts.
(viii) Business combinations and goodwill
Goodwill only arises in business combinations. The amount of goodwill initially recognized is dependent on the allocation of the purchase price to the fair value of the identifiable assets acquired and the liabilities assumed. The determination of the fair value of the assets and liabilities is based, to a considerable extent, on management’s judgment. Allocation of the purchase price affects the results of the Group as finite lived intangible assets are amortized, whereas indefinite lived intangible assets, including goodwill, are not amortized and could result in differing amortization charges based on the allocation to indefinite lived and finite lived intangible assets.
Ardagh Group S.A.
F-24
3. Segment analysis
Following the Group’s announcement to combine Food & Specialty with Exal to form Trivium, the composition of the Group’s operating and reporting segments changed. Food & Specialty has been classified as a discontinued operation. This reflects the basis on which the Group performance is reviewed by management and presented to the Board, which has been identified as the Chief Operating Decision Maker (“CODM”) for the Group. The comparative amounts have been restated in accordance with the requirements of IFRS 8. The following are the Group’s four operating and reportable segments:
|
· |
|
Metal Beverage Packaging Europe |
|
· |
|
Metal Beverage Packaging Americas |
|
· |
|
Glass Packaging Europe |
|
· |
|
Glass Packaging North America. |
Reconciliation of (loss)/profit for the year to Adjusted EBITDA.
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Loss from continuing operations |
|
(284) |
|
(292) |
|
(126) |
Income tax charge/(credit) (Note 6) |
|
44 |
|
18 |
|
(77) |
Net finance expense (Note 5) |
|
659 |
|
479 |
|
638 |
Depreciation and amortization (Notes 9, 10) |
|
652 |
|
599 |
|
583 |
Exceptional operating items (Note 4) |
|
53 |
|
311 |
|
123 |
Share of post-tax loss in equity accounted joint venture (Note 12) |
|
49 |
|
— |
|
— |
Adjusted EBITDA from continuing operations |
|
1,173 |
|
1,115 |
|
1,141 |
|
|
|
|
|
|
|
Profit from discontinued operation (Note 25) |
|
1,742 |
|
198 |
|
189 |
Income tax charge (Note 25) |
|
19 |
|
26 |
|
37 |
Net finance expense (Note 5) |
|
4 |
|
6 |
|
11 |
Depreciation and amortization (Notes 9, 10) |
|
71 |
|
115 |
|
104 |
Exceptional operating items |
|
(1,510) |
|
18 |
|
26 |
Adjusted EBITDA from discontinued operation |
|
326 |
|
363 |
|
367 |
|
|
|
|
|
|
|
Adjusted EBITDA |
|
1,499 |
|
1,478 |
|
1,508 |
Performance of the business is assessed based on Adjusted EBITDA. Adjusted EBITDA is the profit or loss for the period before income tax charge or credit, net finance expense, depreciation and amortization, exceptional operating items and share of profit or loss in equity accounted joint venture. Other items are not allocated to segments, as these are reviewed by the CODM on a group-wide basis. Segmental revenues are derived from sales to external customers. Inter-segment revenue and revenue with joint ventures are not material.
Segment assets consist of intangible assets, property, plant and equipment, derivative financial instrument assets, deferred tax assets, other non‑current assets, inventories, contract assets, trade and other receivables and cash and cash equivalents. The accounting policies of the segments are the same as those in the consolidated financial statements of the Group as set out in Note 2.
Ardagh Group S.A.
F-25
Segment results for the year ended December 31, 2019 are:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal |
|
Metal |
|
|
|
|
|
|
|
|
|
|
|
|
Beverage |
|
Beverage |
|
Glass |
|
Glass |
|
|
|
|
|
|
|
|
Packaging |
|
Packaging |
|
Packaging |
|
Packaging |
|
Continuing |
|
Discontinued |
|
|
|
|
Europe |
|
Americas |
|
Europe |
|
North America |
|
Operations |
|
Operation |
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Revenue |
|
1,556 |
|
1,816 |
|
1,613 |
|
1,675 |
|
6,660 |
|
2,003 |
|
8,663 |
Adjusted EBITDA |
|
253 |
|
250 |
|
391 |
|
279 |
|
1,173 |
|
326 |
|
1,499 |
Capital expenditure |
|
95 |
|
110 |
|
163 |
|
137 |
|
505 |
|
107 |
|
612 |
Segment assets (excluding Investment in material joint venture) |
|
2,360 |
|
1,725 |
|
1,977 |
|
2,241 |
|
8,303 |
|
— |
|
8,303 |
Segment results for the year ended December 31, 2018 are:
|
|
che |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal |
|
Metal |
|
|
|
|
|
|
|
|
|
|
|
|
Beverage |
|
Beverage |
|
Glass |
|
Glass |
|
|
|
|
|
|
|
|
Packaging |
|
Packaging |
|
Packaging |
|
Packaging |
|
Continuing |
|
Discontinued |
|
|
|
|
Europe |
|
Americas |
|
Europe |
|
North America |
|
Operations |
|
Operation |
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Revenue |
|
1,616 |
|
1,742 |
|
1,623 |
|
1,695 |
|
6,676 |
|
2,421 |
|
9,097 |
Adjusted EBITDA |
|
270 |
|
230 |
|
358 |
|
257 |
|
1,115 |
|
363 |
|
1,478 |
Capital expenditure |
|
103 |
|
79 |
|
151 |
|
134 |
|
467 |
|
108 |
|
575 |
Segment assets |
|
2,274 |
|
1,549 |
|
1,916 |
|
2,197 |
|
7,936 |
|
2,378 |
|
10,314 |
Segment results for the year ended December 31, 2017 are:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal |
|
Metal |
|
|
|
|
|
|
|
|
|
|
|
|
Beverage |
|
Beverage |
|
Glass |
|
Glass |
|
|
|
|
|
|
|
|
Packaging |
|
Packaging |
|
Packaging |
|
Packaging |
|
Continuing |
|
Discontinued |
|
|
|
|
Europe |
|
Americas |
|
Europe |
|
North America |
|
Operations |
|
Operation |
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Revenue |
|
1,535 |
|
1,529 |
|
1,549 |
|
1,777 |
|
6,390 |
|
2,206 |
|
8,596 |
Adjusted EBITDA |
|
257 |
|
195 |
|
340 |
|
349 |
|
1,141 |
|
367 |
|
1,508 |
Capital expenditure |
|
95 |
|
69 |
|
110 |
|
126 |
|
400 |
|
92 |
|
492 |
Segment assets |
|
2,392 |
|
1,425 |
|
2,187 |
|
2,622 |
|
8,626 |
|
2,526 |
|
11,152 |
Capital expenditure is the sum of purchases of property, plant and equipment and software and other intangibles, net of proceeds from disposal of property, plant and equipment, as per the consolidated statement of cash flows.
One customer accounted for greater than 10% of total revenue from continuing operations in 2019 (2018: none; 2017: one).
Ardagh Group S.A.
F-26
Total revenue from continuing operations and non‑current assets, excluding derivative financial instruments, taxes, pensions and goodwill arising on acquisitions, in countries which account for more than 10% of total revenue or non‑current assets, in the current or prior years presented, are as follows:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
Revenue |
|
$'m |
|
$'m |
|
$'m |
U.S. |
|
2,974 |
|
2,911 |
|
2,852 |
United Kingdom |
|
736 |
|
778 |
|
702 |
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
Non-current assets |
|
$'m |
|
$'m |
U.S. |
|
2,100 |
|
2,190 |
Germany |
|
713 |
|
847 |
United Kingdom |
|
665 |
|
659 |
The revenue above is attributed to countries on a destination basis.
The Company is domiciled in Luxembourg. During the year the continuing operations had revenues of $2 million (2018: $2 million, 2017: $2 million) with customers in Luxembourg. Non‑current assets located in Luxembourg were $nil (2018: $nil).
Within each reportable segment our respective packaging containers have similar production processes and classes of customers. Further, they have similar economic characteristics, as evidenced by similar profit margins, similar degrees of risk and similar opportunities for growth. Based on the foregoing, we do not consider that they constitute separate product lines and therefore additional disclosures relating to product lines is not necessary.
The following illustrates the disaggregation of revenue by destination for the year ended December 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
North |
|
Rest of the |
|
|
|
|
Europe |
|
America |
|
world |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Metal Beverage Packaging Europe |
|
1,541 |
|
5 |
|
10 |
|
1,556 |
Metal Beverage Packaging Americas |
|
2 |
|
1,419 |
|
395 |
|
1,816 |
Glass Packaging Europe |
|
1,554 |
|
7 |
|
52 |
|
1,613 |
Glass Packaging North America |
|
– |
|
1,674 |
|
1 |
|
1,675 |
Continuing operations |
|
3,097 |
|
3,105 |
|
458 |
|
6,660 |
Discontinued operation |
|
1,480 |
|
389 |
|
134 |
|
2,003 |
Group |
|
4,577 |
|
3,494 |
|
592 |
|
8,663 |
The following illustrates the disaggregation of revenue by destination for the year ended December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
North |
|
Rest of the |
|
|
|
|
Europe |
|
America |
|
world |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Metal Beverage Packaging Europe |
|
1,601 |
|
2 |
|
13 |
|
1,616 |
Metal Beverage Packaging Americas |
|
1 |
|
1,339 |
|
402 |
|
1,742 |
Glass Packaging Europe |
|
1,572 |
|
9 |
|
42 |
|
1,623 |
Glass Packaging North America |
|
– |
|
1,687 |
|
8 |
|
1,695 |
Continuing operations |
|
3,174 |
|
3,037 |
|
465 |
|
6,676 |
Discontinued operation |
|
1,795 |
|
447 |
|
179 |
|
2,421 |
Group |
|
4,969 |
|
3,484 |
|
644 |
|
9,097 |
Ardagh Group S.A.
F-27
4. Exceptional items
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Legal matter |
|
15 |
|
— |
|
— |
Start-up related costs |
|
13 |
|
48 |
|
8 |
Restructuring and other costs |
|
6 |
|
50 |
|
32 |
Impairment - property, plant and equipment |
|
5 |
|
5 |
|
38 |
Past service (credit)/charge |
|
(37) |
|
5 |
|
— |
Exceptional items - cost of sales |
|
2 |
|
108 |
|
78 |
Transaction-related costs |
|
51 |
|
17 |
|
45 |
Exceptional items - SGA expenses |
|
51 |
|
17 |
|
45 |
Impairment - goodwill |
|
— |
|
186 |
|
— |
Exceptional items - impairment of intangible assets |
|
— |
|
186 |
|
— |
Debt refinancing and settlement costs |
|
200 |
|
16 |
|
117 |
Loss on derivative financial instruments |
|
3 |
|
6 |
|
15 |
Exceptional items - finance expense |
|
203 |
|
22 |
|
132 |
Share of exceptional items in material joint venture |
|
39 |
|
— |
|
— |
Exceptional items from continuing operations |
|
295 |
|
333 |
|
255 |
Exceptional income tax charge/(credit) |
|
3 |
|
(49) |
|
(124) |
Exceptional items from continuing operations, net of tax |
|
298 |
|
284 |
|
131 |
Exceptional items from discontinued operation, net of tax |
|
(1,527) |
|
13 |
|
12 |
Total exceptional (credit)/charge, net of tax |
|
(1,229) |
|
297 |
|
143 |
Exceptional items are those that in management’s judgment need to be disclosed by virtue of their size, nature or incidence.
2019
Exceptional items of $1,229 million have been recognized for the year ending December 31, 2019, primarily comprising:
|
· |
|
$15 million related to a legal matter as described in Note 28 of the consolidated financial statements. |
|
· |
|
$24 million related to the Group’s capacity realignment programs, including start-up related costs ($13 million), restructuring costs ($6 million), property, plant and equipment impairment charges ($5 million). These costs were incurred in Glass Packaging North America ($15 million), Glass Packaging Europe ($5 million), Metal Beverage Packaging America ($2 million) and Metal Beverage Packaging Europe ($2 million). |
|
· |
|
$37 million pension service credit recognized in Glass Packaging North America following amendments to a pension scheme. |
|
· |
|
$51 million transaction-related costs, primarily comprising costs relating to the combination of the Group’s Food & Specialty Metal Packaging business with the business of Exal Corporation to form Trivium. |
|
· |
|
$200 million debt refinancing and settlement costs related to the redemption of notes in August and November 2019 as described in Note 20, premium payable on the early redemption of the notes of $165 million, accelerated amortization of deferred finance costs, and include interest charges from the call date to date of redemption and $3 million exceptional loss on the termination of derivative financial instruments. |
|
· |
|
$39 million from the share of exceptional items in the Trivium joint venture. |
Ardagh Group S.A.
F-28
|
· |
|
$3 million from tax charge, as described in Note 6. |
|
· |
|
$1,527 million from discontinued operation, net of tax, primarily related to the gain, net of directly attributable disposal costs, on the disposal of the Food & Specialty Metal Packaging business. |
2018
Exceptional items of $297 million have been recognized for the year ending December 31, 2018, primarily comprising:
|
· |
|
$103 million related to the Group’s capacity realignment programs, including start-up related costs ($48 million) restructuring costs ($50 million), property, plant and equipment impairment charges ($5 million). These costs were incurred in Glass Packaging North America ($78 million), Metal Beverage Packaging Europe ($24 million), Glass Packaging Europe ($5 million) and a cost reduction in Metal Beverage Packaging Americas ($4 million). |
|
· |
|
$5 million pension service cost recognized in Metal Beverage Packaging Europe and Glass Packaging Europe following a High Court ruling in the U.K. in October 2018 in respect of GMP equalization (Note 21). |
|
· |
|
$17 million transaction-related costs, primarily comprised of costs relating to acquisition, integration and other transactions. |
|
· |
|
$186 million impairment of goodwill in Glass Packaging North America. |
|
· |
|
$16 million debt refinancing and settlement costs primarily relating to the redemption of the Group’s $440 million 6.000% Senior Notes due 2021 in July 2018, principally comprising an early redemption premium and accelerated amortization of deferred finance costs. |
|
· |
|
$6 million exceptional loss on the termination of the Group’s $440 million U.S. dollar to euro CCIRS in July 2018. |
|
· |
|
$49 million from tax credits, as described in Note 6. |
|
· |
|
$13 million related to exceptional items from discontinued operation, net of tax. |
2017
Exceptional items of $143 million have been recognized for the year ending December 31, 2017, primarily comprising:
|
· |
|
$78 million related to the Group’s capacity realignment programs, including restructuring costs ($32 million), start-up related costs ($8 million) and property, plant and equipment impairment charges ($38 million). These costs were incurred in Glass Packaging North America ($43 million), Metal Beverage Packaging Europe ($33 million) and Metal Beverage Packaging Americas ($2 million). |
|
· |
|
$45 million transaction related costs, primarily comprised of costs directly attributable to the Beverage Can Acquisition and integration of that business and other IPO and transaction-related costs. |
|
· |
|
$117 million debt refinancing and settlement costs relating to the notes and loans redeemed and repaid in January, March, April, June, and August 2017, principally comprising premiums payable on the early redemption of the notes and accelerated amortization of deferred finance costs and issue discounts. |
|
· |
|
$15 million exceptional loss on the termination in June 2017, of $500 million of the Group’s U.S. dollar to British pound CCIRS, of which $12 million relates to cumulative losses recycled from other comprehensive income. |
|
· |
|
$124 million from tax credits, as described in Note 6. |
|
· |
|
$12 million related to exceptional items from discontinued operation, net of tax. |
Ardagh Group S.A.
F-29
5. Finance income and expense
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Senior secured and senior notes |
|
367 |
|
421 |
|
431 |
Other interest expense |
|
40 |
|
22 |
|
5 |
Term loan |
|
— |
|
— |
|
5 |
Interest expense |
|
407 |
|
443 |
|
441 |
Net pension interest cost (Note 21) |
|
18 |
|
16 |
|
18 |
Foreign currency translation losses |
|
27 |
|
8 |
|
21 |
Loss/(gain) on derivative financial instruments |
|
9 |
|
(10) |
|
27 |
Other finance income |
|
(5) |
|
— |
|
(1) |
Finance expense before exceptional items |
|
456 |
|
457 |
|
506 |
Exceptional finance expense (Note 4) |
|
203 |
|
22 |
|
132 |
Net finance expense from continuing operations |
|
659 |
|
479 |
|
638 |
Net finance expense from discontinued operation |
|
4 |
|
6 |
|
11 |
Net finance expense |
|
663 |
|
485 |
|
649 |
During the year ended December 31, 2019, the continuing operations of the Group recognized $19 million related to lease liabilities within other interest expense and interest paid in cash used in operating activities.
6. Income tax
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Current tax: |
|
|
|
|
|
|
Current tax for the year |
|
70 |
|
73 |
|
60 |
Adjustments in respect of prior years |
|
7 |
|
11 |
|
1 |
Total current tax |
|
77 |
|
84 |
|
61 |
Deferred tax: |
|
|
|
|
|
|
Deferred tax for the year |
|
(31) |
|
(58) |
|
(133) |
Adjustments in respect of prior years |
|
(2) |
|
(8) |
|
(5) |
Total deferred tax |
|
(33) |
|
(66) |
|
(138) |
Income tax charge/(credit) |
|
44 |
|
18 |
|
(77) |
Ardagh Group S.A.
F-30
Reconciliation of income tax charge/(credit) and the loss before tax multiplied by the Group’s domestic tax rate for 2019, 2018 and 2017 is as follows:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Loss before tax |
|
(240) |
|
(274) |
|
(203) |
Loss before tax multiplied by the standard rate of Luxembourg corporation tax: 24.94% (2018: 26.01%; 2017: 27.08%) |
|
(60) |
|
(71) |
|
(55) |
Tax losses for which no deferred income tax asset was recognized |
|
32 |
|
— |
|
— |
Re-measurement of deferred taxes |
|
(2) |
|
1 |
|
(69) |
Adjustment in respect of prior years |
|
5 |
|
3 |
|
(4) |
Income subject to state and other local income taxes |
|
11 |
|
12 |
|
12 |
Income taxed at rates other than standard tax rates |
|
7 |
|
5 |
|
(6) |
Non-deductible items |
|
48 |
|
55 |
|
42 |
Other |
|
3 |
|
13 |
|
3 |
Income tax charge/(credit) |
|
44 |
|
18 |
|
(77) |
The total income tax charge/(credit) outlined above for each year includes a tax charge of $3 million in 2019 (2018 tax credit of $49 million; 2017 tax credit of $124 million) in respect of exceptional items, being the tax effect of the items set out in Note 4. The $124 million exceptional income tax credit recognized in the year ended December 31, 2017 includes a credit of $71 million on remeasurement of deferred tax positions following the enactment of the Tax Cuts and Jobs Act of 2017 (“TCJA”) in the United States of America.
Tax losses for which no deferred income tax asset was recognized relates to tax losses incurred in Ireland in respect of exceptional finance expense, in addition to the carry-forward of interest expense in certain jurisdictions.
Non‑deductible items principally relate to non‑deductible interest expense in Ireland and Luxembourg, in addition to the elimination of intercompany recharges and finance expense relating to discontinued operations. Income taxed at non‑standard rates takes account of foreign tax rate differences (versus the Luxembourg standard 24.94% rate) on earnings.
The tax charge associated with discontinued operation is recognized separately in the results of discontinued operation. See note 25 for further details.
Ardagh Group S.A.
F-31
7. Earnings per share
Basic earnings per share (“EPS”) is calculated by dividing the profit/(loss) for the year attributable to equity holders by the weighted average number of common shares outstanding during the year.
The following table reflects the income statement profit/(loss) and share data used in the basic EPS calculations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||||||
|
|
2019 |
|
2018 |
|
2017 |
|
|||
|
|
$'m |
|
$'m |
|
$'m |
|
|||
Profit/(loss) attributable to equity holders |
|
|
1,458 |
|
|
(94) |
|
|
63 |
|
Weighted average number of common shares for EPS (millions) |
|
|
236.4 |
|
|
236.3 |
|
|
229.6 |
|
Earnings/(loss) per share |
|
$ |
6.17 |
|
$ |
(0.40) |
|
$ |
0.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||||||
|
|
2019 |
|
2018 |
|
2017 |
|
|||
|
|
$'m |
|
$'m |
|
$'m |
|
|||
Loss from continuing operations attributable to equity holders |
|
|
(284) |
|
|
(292) |
|
|
(126) |
|
Weighted average number of common shares for EPS (millions) |
|
|
236.4 |
|
|
236.3 |
|
|
229.6 |
|
Loss per share from continuing operations |
|
$ |
(1.20) |
|
$ |
(1.24) |
|
$ |
(0.55) |
|
Diluted earnings per share is consistent with basic earnings per share as there are no dilutive potential common shares.
Please refer to Note 18 for details of transactions involving ordinary shares for the years ended December 31, 2019 and 2018. See Note 25 for basic and diluted earnings per share from discontinued operation.
There have been no material transactions involving common shares or potential ordinary shares between the reporting date and the authorization of these financial statements.
8. Employee costs
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Wages and salaries |
|
1,048 |
|
962 |
|
1,028 |
Social security costs |
|
155 |
|
154 |
|
139 |
Defined benefit plan pension costs (Note 21) |
|
31 |
|
42 |
|
36 |
Defined benefit past service (credit)/charge (Note 21) |
|
(54) |
|
6 |
|
— |
Defined contribution plan pension costs (Note 21) |
|
40 |
|
32 |
|
30 |
Net employee costs from continuing operations |
|
1,220 |
|
1,196 |
|
1,233 |
Net employee costs from discontinued operation |
|
370 |
|
424 |
|
392 |
Group employee costs |
|
1,590 |
|
1,620 |
|
1,625 |
|
|
|
|
|
|
|
|
|
At December 31, |
||||
Employees |
|
2019 |
|
2018 |
|
2017 |
Production |
|
14,463 |
|
14,666 |
|
14,809 |
Administration |
|
1,877 |
|
1,986 |
|
1,924 |
Continuing operations |
|
16,340 |
|
16,652 |
|
16,733 |
Discontinued operation |
|
— |
|
6,775 |
|
6,758 |
Group |
|
16,340 |
|
23,427 |
|
23,491 |
Ardagh Group S.A.
F-32
9. Intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer |
|
Technology |
|
|
|
|
|
|
Goodwill |
|
relationships |
|
and other |
|
Software |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Cost |
|
|
|
|
|
|
|
|
|
|
At January 1, 2018 |
|
2,201 |
|
2,355 |
|
251 |
|
88 |
|
4,895 |
Additions |
|
— |
|
— |
|
12 |
|
25 |
|
37 |
Impairment (i) |
|
(186) |
|
— |
|
— |
|
— |
|
(186) |
Exchange |
|
(45) |
|
(55) |
|
(8) |
|
(3) |
|
(111) |
At December 31, 2018 |
|
1,970 |
|
2,300 |
|
255 |
|
110 |
|
4,635 |
Amortization |
|
|
|
|
|
|
|
|
|
|
At January 1, 2018 |
|
|
|
(607) |
|
(126) |
|
(58) |
|
(791) |
Charge for the year |
|
|
|
(227) |
|
(30) |
|
(8) |
|
(265) |
Exchange |
|
|
|
17 |
|
3 |
|
2 |
|
22 |
At December 31, 2018 |
|
|
|
(817) |
|
(153) |
|
(64) |
|
(1,034) |
Net book value |
|
|
|
|
|
|
|
|
|
|
At December 31, 2018 |
|
1,970 |
|
1,483 |
|
102 |
|
46 |
|
3,601 |
Cost |
|
|
|
|
|
|
|
|
|
|
At January 1, 2019 |
|
1,970 |
|
2,300 |
|
255 |
|
110 |
|
4,635 |
Additions |
|
— |
|
— |
|
12 |
|
13 |
|
25 |
Disposal of Food & Specialty |
|
(328) |
|
(203) |
|
(103) |
|
(44) |
|
(678) |
Disposal |
|
— |
|
— |
|
— |
|
(1) |
|
(1) |
Transfers |
|
— |
|
— |
|
(11) |
|
11 |
|
— |
Exchange |
|
(18) |
|
(14) |
|
(3) |
|
(2) |
|
(37) |
At December 31, 2019 |
|
1,624 |
|
2,083 |
|
150 |
|
87 |
|
3,944 |
Amortization |
|
|
|
|
|
|
|
|
|
|
At January 1, 2019 |
|
|
|
(817) |
|
(153) |
|
(64) |
|
(1,034) |
Charge for the year |
|
|
|
(214) |
|
(27) |
|
(8) |
|
(249) |
Disposal of Food & Specialty |
|
|
|
146 |
|
60 |
|
6 |
|
212 |
Disposal |
|
|
|
— |
|
— |
|
1 |
|
1 |
Exchange |
|
|
|
5 |
|
3 |
|
2 |
|
10 |
At December 31, 2019 |
|
|
|
(880) |
|
(117) |
|
(63) |
|
(1,060) |
Net book value |
|
|
|
|
|
|
|
|
|
|
At December 31, 2019 |
|
1,624 |
|
1,203 |
|
33 |
|
24 |
|
2,884 |
Amortization expense of $233 million (2018: $237 million, 2017: $237 million) has been charged to the consolidated income statement of the Group in respect of continuing operations. An amortization expense of $16 million (2018: $28 million, 2017: $27 million) has been charged to the consolidated income statement of the Group in respect of the discontinued operation.
(i) An impairment charge of $186 million, before the impact of deferred tax, was recognized in the year ended December 31, 2018 in respect of the goodwill in Glass Packaging North America. The impairment testing performed used a FVLCTS calculation for the Glass Packaging North America CGU.
Goodwill
Allocation of goodwill
Goodwill has been allocated to groups of CGUs for the purpose of impairment testing. The groupings represent the lowest level at which the related goodwill is monitored for internal management purposes. Goodwill acquired through
Ardagh Group S.A.
F-33
business combination activity is allocated to CGUs that are expected to benefit from synergies arising from that combination.
The lowest level within the Group at which the goodwill is monitored for internal management purposes and consequently the CGUs to which goodwill is allocated is set out below. The Group changed the composition of its operating and reporting segments following the disposal of its Food & Specialty Metal Packaging business which completed on October 31, 2019. On this basis the Group’s CGUs are identified as follows:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Metal Beverage Packaging Europe |
|
566 |
|
577 |
Metal Beverage Packaging Americas |
|
437 |
|
437 |
Glass Packaging Europe |
|
61 |
|
62 |
Glass Packaging North America |
|
560 |
|
560 |
Total Goodwill from continuing operations |
|
1,624 |
|
1,636 |
Discontinued operation Europe |
|
— |
|
305 |
Discontinued operation North America |
|
— |
|
29 |
Total Goodwill |
|
1,624 |
|
1,970 |
Impairment tests for goodwill
The Group performs its impairment test of goodwill annually following approval of the annual budget.
Recoverable amount and carrying amount
The Group used the value in use (“VIU”) model for the purposes of goodwill impairment testing, as this reflects the Group’s intention to hold and operate the assets. However, if an impairment indicator exists for a CGU, the Group uses both the VIU model and the fair value less costs to sell (“FVLCTS”) model to establish the higher of the recoverable amount.
Value in use
The VIU model used the 2020 budget approved by the Board and a two year forecast for 2021 to 2022. The budget and forecast results were then extended for a further two‑year period (2018: two-year period) making certain assumptions, including that long-term depreciation equals capital expenditure and that any increase in input cost will be passed through to customers, in line with historic practice and contractual terms.
Cash flows considered in the VIU model included the cash inflows and outflows related to the continuing use of the assets over their remaining useful lives, expected earnings, required maintenance capital expenditure, depreciation and working capital.
The discount rate applied to cash flows in the VIU model was estimated using our weighted average cost of capital as determined by the Capital Asset Pricing Model with regard to the risks associated with the cash flows being considered (country, market and specific risks of the asset).
The modelled cash flows take into account the Group’s established history of earnings, cash flow generation and the nature of the markets in which we operate, where product obsolescence is low. The key assumptions employed in modelling estimates of future cash flows are subjective and include projected Adjusted EBITDA, discount rates and growth rates, replacement capital expenditure requirements, rates of customer retention and the ability to maintain margin through the pass through of input cost inflation.
Ardagh Group S.A.
F-34
The terminal value assumed long-term growth based on a combination of factors including long-term inflation in addition to industry and market specific factors. The range of growth rates applied by management in respect of the terminal values applicable to all groups of CGU’s were 1.0% - 1.5% (2018: 1.5%).
A sensitivity analysis was performed reflecting potential variations in terminal growth rate and discount rate assumptions. In all cases the recoverable values calculated were in excess of the carrying values of the CGUs. The variation applied to terminal value growth rates and discount rates was a 50 basis points decrease and increase respectively and represents a reasonably possible change to the key assumptions of the VIU model. Further, a reasonably possible change to the operating cash flows would not reduce the recoverable amounts below the carrying value of the CGUs.
The FVLCTS calculation in the prior year for the Glass Packaging North America CGU resulted in a higher recoverable amount than the VIU model. The FVLCTS calculation used the 2019 projected Adjusted EBITDA multiplied by an earnings multiple of 6.7x, based on comparable market transactions, and adjusted for selling costs.
The additional disclosures required under IAS 36 in relation to significant goodwill amounts arising in the groups of CGUs are as follows:
|
|
|
|
|
|
|
|
|
|
|
Metal |
|
Metal |
|
|
|
Glass |
|
|
Beverage |
|
Beverage |
|
Glass |
|
Packaging |
|
|
Packaging |
|
Packaging |
|
Packaging |
|
North |
|
|
Europe |
|
Americas |
|
Europe |
|
America |
|
|
$'m/% |
|
$'m/% |
|
$'m/% |
|
$'m/% |
2019 |
|
|
|
|
|
|
|
|
Carrying amount of goodwill |
|
566 |
|
437 |
|
61 |
|
560 |
Excess of recoverable amount |
|
|
|
|
|
|
|
|
Pre-tax discount rate applied |
|
5.1 |
|
8.5 |
|
6.5 |
|
7.2 |
2018 |
|
|
|
|
|
|
|
|
Carrying amount of goodwill |
|
577 |
|
437 |
|
62 |
|
560 |
Excess of recoverable amount |
|
|
|
|
|
|
|
N/A |
Pre-tax discount rate applied |
|
6.7 |
|
9.6 |
|
8.5 |
|
N/A |
2017 |
|
|
|
|
|
|
|
|
Carrying amount of goodwill |
|
604 |
|
437 |
|
65 |
|
746 |
Excess of recoverable amount |
|
|
|
|
|
|
|
|
Pre-tax discount rate applied |
|
7.4 |
|
9.6 |
|
8.2 |
|
9.1 |
Ardagh Group S.A.
F-35
10. Property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office |
|
|
|
|
|
|
|
|
equipment, |
|
|
|
|
Land and |
|
Plant and |
|
vehicles |
|
|
|
|
buildings |
|
machinery |
|
and other |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Cost |
|
|
|
|
|
|
|
|
At January 1, 2018 |
|
1,094 |
|
4,142 |
|
71 |
|
5,307 |
Additions |
|
15 |
|
539 |
|
37 |
|
591 |
Disposals |
|
(16) |
|
(190) |
|
(11) |
|
(217) |
Impairment (Note 4) |
|
— |
|
(11) |
|
— |
|
(11) |
Transfers |
|
— |
|
— |
|
5 |
|
5 |
Exchange |
|
(49) |
|
(182) |
|
(8) |
|
(239) |
At December 31, 2018 |
|
1,044 |
|
4,298 |
|
94 |
|
5,436 |
Depreciation |
|
|
|
|
|
|
|
|
At January 1, 2018 |
|
(258) |
|
(1,656) |
|
(25) |
|
(1,939) |
Charge for the year |
|
(37) |
|
(388) |
|
(24) |
|
(449) |
Disposals |
|
10 |
|
187 |
|
9 |
|
206 |
Exchange |
|
21 |
|
107 |
|
6 |
|
134 |
At December 31, 2018 |
|
(264) |
|
(1,750) |
|
(34) |
|
(2,048) |
Net book value |
|
|
|
|
|
|
|
|
At December 31, 2018 |
|
780 |
|
2,548 |
|
60 |
|
3,388 |
Cost |
|
|
|
|
|
|
|
|
At January 1, 2019, as reported |
|
1,044 |
|
4,298 |
|
94 |
|
5,436 |
Impact of adoption of IFRS 16 on January 1, 2019 (Note 2) |
|
193 |
|
78 |
|
19 |
|
290 |
At January 1, 2019 |
|
1,237 |
|
4,376 |
|
113 |
|
5,726 |
Additions |
|
148 |
|
528 |
|
60 |
|
736 |
Disposals |
|
(21) |
|
(194) |
|
(8) |
|
(223) |
Disposal of Food & Specialty |
|
(337) |
|
(1,443) |
|
(39) |
|
(1,819) |
Impairment (Note 4) |
|
— |
|
(5) |
|
— |
|
(5) |
Exchange |
|
(9) |
|
(26) |
|
— |
|
(35) |
At December 31, 2019 |
|
1,018 |
|
3,236 |
|
126 |
|
4,380 |
Depreciation |
|
|
|
|
|
|
|
|
At January 1, 2019 |
|
(264) |
|
(1,750) |
|
(34) |
|
(2,048) |
Charge for the year |
|
(75) |
|
(363) |
|
(36) |
|
(474) |
Disposals |
|
6 |
|
190 |
|
8 |
|
204 |
Disposal of Food & Specialty |
|
55 |
|
530 |
|
21 |
|
606 |
Exchange |
|
2 |
|
7 |
|
— |
|
9 |
At December 31, 2019 |
|
(276) |
|
(1,386) |
|
(41) |
|
(1,703) |
Net book value |
|
|
|
|
|
|
|
|
At December 31, 2019 |
|
742 |
|
1,850 |
|
85 |
|
2,677 |
Depreciation expense of $408 million (2018: $354 million; 2017: $340 million) has been charged in cost of sales and $11 million (2018: $8 million; 2017: $6 million) in sales, general and administration expenses in respect of the continuing operations of the Group. Depreciation expense of $53 million (2018: $86 million, 2017: $76 million) has been charged in cost of sales and $2 million (2018: $1 million. 2017: $1 million) in sales, general and administration expenses in respect of the discontinued operation of the Group.
Construction in progress at December 31, 2019 was $173 million (2018: $254 million).
Included in property, plant and equipment is an amount for land of $185 million (2018: $213 million).
Ardagh Group S.A.
F-36
Substantially all of the Group’s property, plant and equipment is pledged as security under the terms and conditions of the Group’s financing arrangements. No interest was capitalized in the year (2018: $nil).
Impairment
The Board has considered the carrying value of the Group’s property, plant and equipment and assessed the indicators of impairment as at December 31, 2019 in accordance with IAS 36. In the year ended December 31, 2019 an impairment charge of $5 million (2018: $11 million) has been recognized, which relates to the impairment of plant and machinery in Glass Packaging North America. In 2018, the Group recognized an impairment charge of $11 million, of which $4 million related to the impairment of plant and machinery in Glass Packaging North America, $1 million related to the impairment of plant and machinery in Metal Beverage Packaging Europe and $6 million related to the impairment of plant and machinery in the discontinued operation.
Right of Use assets – Net Book Value and depreciation
At December 31, 2019 the following right-of-use assets were included in property, plant and equipment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office |
|
|
|
|
|
|
|
|
equipment, |
|
|
|
|
Land and |
|
Plant and |
|
vehicles |
|
|
|
|
buildings |
|
machinery |
|
and other |
|
Total |
Net book value |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
At December 31, 2019 |
|
|
|
|
|
|
|
|
The net carrying amount of the right-of use assets at December 31, 2019 is primarily the result of existing finance leases as at December 31, 2018 of $29 million, the impact of adoption of IFRS 16 on January 1, 2019 of $290 million, total additions to the right-of-use assets during the year ended December 31, 2019 of $169 million, offset by an amount of $74 million de-recognized on the disposal of Food & Specialty and a depreciation charge of $76 million (Land and buildings: $41 million, Plant and machinery: $21 million, Office equipment, vehicles and other: $14 million).
Operating lease commitments
The Group adopted IFRS 16 effective January 1, 2019, resulting in the majority of the Group’s operating leases being recognized on the consolidated statement of financial position. Please refer to Note 2 for more details.
During 2018 and 2017, the expense in respect of operating lease commitments was as follows:
|
|
|
|
|
|
|
Year ended December 31, |
||
|
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
Plant and machinery |
|
22 |
|
21 |
Land and buildings |
|
51 |
|
38 |
Office equipment and vehicles |
|
17 |
|
9 |
|
|
90 |
|
68 |
Ardagh Group S.A.
F-37
At December 31, 2018 and 2017, the Group had total commitments under non-cancellable operating leases which expire:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
Not later than one year |
|
67 |
|
64 |
Later than one year and not later than five years |
|
150 |
|
132 |
Later than five years |
|
147 |
|
106 |
|
|
364 |
|
302 |
Capital commitments
The following capital commitments in relation to property, plant and equipment were authorized by management, but have not been provided for in the consolidated financial statements:
|
|
|
|
|
|
|
|
|
At December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Contracted for |
|
77 |
|
118 |
|
101 |
Not contracted for |
|
82 |
|
76 |
|
14 |
|
|
159 |
|
194 |
|
115 |
11. Other non‑current assets
At December 31, 2019, other non‑current assets of $68 million includes the receivable for the tax adjusted indemnity as set out in Note 28.
Other non-current assets also includes $6 million relating to certain of the Group’s investment in its joint ventures, excluding the investment in Trivium Packaging B.V., which is further discussed in Note 12.
Ardagh Group S.A.
F-38
12. Investment in material joint venture
Investment in material joint venture is comprised of the Group’s approximate 42% investment in Trivium which is a global leader in metal packaging in the form of cans and aerosol containers, serving a broad range of end-use categories, including food, seafood, pet food and nutrition, as well as beauty and personal care. The Group investment in Trivium arose from the combination of its Food & Specialty Metal Packaging business with that of Exal, a leading producer of aluminum containers. The remaining approximate 58% is held by Ontario Teachers. As the Group jointly controls both the financial and operating policy decisions of Trivium, the investment is accounted for under the equity method. The shareholders of Trivium have entered into a Shareholders Agreement, dated October 31, 2019, which governs their relationship as owners of Trivium, including in respect of the governance of Trivium and its subsidiaries, their ability to transfer their shares in Trivium and other customary matters. Trivium Packaging B.V. is incorporated in the Netherlands, with corporate offices in Amsterdam.
The following table provides aggregated financial information for Trivium as it relates to the amounts recognized in the income statement, statement of comprehensive income and statement of financial position.
|
|
|
Year ended December 31, |
|
2019 |
|
$'m |
Investment in joint venture |
375 |
Loss for the period |
(49) |
Other comprehensive income |
7 |
Total comprehensive loss |
(42) |
Summarized financial information for Trivium for the two months ended and as at December 31, 2019 is set out below.
|
|
|
Period ended December 31, |
|
2019 |
|
$'m |
Revenue |
351 |
Expenses |
(408) |
Operating loss |
(57) |
Net finance expense |
(56) |
Loss before tax |
(113) |
Income tax |
(1) |
Loss after tax1 |
(114) |
1 The income statement for the two month period ended December 31, 2019 includes $92 million in relation to exceptional items of which $31 million is in respect of exceptional interest expense. Also included is $25 million of non-exceptional interest expense.
Ardagh Group S.A.
F-39
|
|
|
At December 31, |
|
2019 |
|
$'m |
Non-current assets |
4,109 |
Current assets |
924 |
Total assets |
5,033 |
|
|
Total equity |
875 |
Non-current liabilities |
3,444 |
Current liabilities |
714 |
Total liabilities |
4,158 |
Total equity and liabilities |
5,033 |
As at December 31, 2019, Trivium had net debt of $2.8 billion.
Trivium management have included a provisional estimate of the fair values at the acquisition date in the above information.
The reconciliation of summarized financial information presented to the carrying amount of the Group’s interest in Trivium is set out below.
|
|
|
2019 |
|
$'m |
Group's interest in net assets of joint venture - November 12 |
|
Share of total comprehensive loss |
(42) |
Exchange |
5 |
Carrying amount of interest in joint venture - December 31 |
375 |
2 The Group used a comparable market multiples approach including Adjusted EBITDA multiplied by an earnings multiple (based on comparable market transactions) as adjusted for debt in order to assess the fair value of its 42% initial equity investment in Trivium of $412 million.
Mutual Services Agreement (“MSA”)
The Group has entered into an MSA, with Trivium pursuant to which the Group and Trivium provide services to each other. The Services generally relate to administrative support in respect of treasury activities, tax reporting, procurement and logistics, R&D, product development and certain IT services. The MSA provides for the sharing of certain facilities leased by the Group in connection with the provision of Services, with appropriate segregations in place between the Group’s entities, on the one hand, and Trivium, on the other hand.
Ardagh Group S.A.
F-40
13. Deferred income tax
The movement in deferred tax assets and liabilities during the year was as follows:
|
|
|
|
|
|
|
|
|
Assets |
|
Liabilities |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
At January 1, 2018 |
|
428 |
|
(790) |
|
(362) |
Credited to the income statement (Note 6) |
|
49 |
|
17 |
|
66 |
(Charged)/credited to the income statement (Discontinued operation) |
|
(13) |
|
12 |
|
(1) |
Credited/(charged) to other comprehensive income |
|
7 |
|
(3) |
|
4 |
Reclassification |
|
(36) |
|
36 |
|
— |
Exchange |
|
(3) |
|
7 |
|
4 |
At December 31, 2018 |
|
432 |
|
(721) |
|
(289) |
IFRS 16 |
|
14 |
|
(1) |
|
13 |
Credited to the income statement (Note 6) |
|
17 |
|
16 |
|
33 |
Charged to the income statement (Discontinued operation) |
|
(12) |
|
(1) |
|
(13) |
Credited to other comprehensive income |
|
30 |
|
3 |
|
33 |
Exchange |
|
1 |
|
3 |
|
4 |
Disposal of Food & Specialty |
|
(76) |
|
155 |
|
79 |
At December 31, 2019 |
|
406 |
|
(546) |
|
(140) |
The components of deferred income tax assets and liabilities are as follows:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Tax losses |
|
40 |
|
49 |
Employee benefit obligations |
|
142 |
|
179 |
Depreciation timing differences |
|
84 |
|
83 |
Provisions |
|
74 |
|
69 |
Other |
|
66 |
|
52 |
|
|
406 |
|
432 |
Available for offset |
|
(202) |
|
(178) |
Deferred tax assets |
|
204 |
|
254 |
Intangible assets |
|
(295) |
|
(344) |
Accelerated depreciation and other fair value adjustments |
|
(206) |
|
(343) |
Other |
|
(45) |
|
(34) |
|
|
(546) |
|
(721) |
Available for offset |
|
202 |
|
178 |
Deferred tax liabilities |
|
(344) |
|
(543) |
Ardagh Group S.A.
F-41
The tax credit recognized in the consolidated income statement is analyzed as follows:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Tax losses |
|
(4) |
|
18 |
|
(2) |
Employee benefit obligations |
|
(11) |
|
3 |
|
(21) |
Depreciation timing differences |
|
21 |
|
4 |
|
(6) |
Provisions |
|
(2) |
|
(1) |
|
(26) |
Other deferred tax assets |
|
1 |
|
12 |
|
(12) |
Intangible assets |
|
19 |
|
52 |
|
155 |
Accelerated depreciation and other fair value adjustments |
|
(12) |
|
(20) |
|
29 |
Other deferred tax liabilities |
|
8 |
|
(3) |
|
23 |
|
|
20 |
|
65 |
|
140 |
Deferred tax assets are only recognized on tax loss carry‑forwards to the extent that the realization of the related tax benefit through future taxable profits is probable based on management’s forecasts. The Group did not recognize deferred tax assets of $37 million (2018: $32 million) in respect of tax losses amounting to $146 million (2018: $145 million) that can be carried forward against future taxable income due to uncertainty regarding their utilization.
No provision has been made for temporary differences applicable to investments in subsidiaries as the Group is in a position to control the timing of reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Given that exemptions and tax credits would be available in the context of the Group’s investments in subsidiaries in the majority of jurisdictions in which it operates, the aggregate amount of temporary differences in respect of which deferred tax liabilities have not been recognized would not be material.
14. Inventories
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Raw materials and consumables |
|
299 |
|
389 |
Mold parts |
|
50 |
|
51 |
Work-in-progress |
|
19 |
|
114 |
Finished goods |
|
596 |
|
730 |
|
|
964 |
|
1,284 |
Certain inventories held by the Group have been pledged as security under the Group’s Global Asset Based Loan Facility (Note 20). The amount recognized as a write down in inventories or as a reversal of a write down in the year ended December 31, 2019 was not material.
At December 31, 2019, the hedging loss included in the carrying value of inventories, which will be recognized in the income statement when the related finished goods have been sold, is not material.
Ardagh Group S.A.
F-42
15. Trade and other receivables
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Trade receivables |
|
516 |
|
823 |
Other receivables and prepayments |
|
178 |
|
230 |
Related party receivables |
|
40 |
|
— |
|
|
734 |
|
1,053 |
The fair values of trade and other receivables approximate the amounts shown above.
Movements on the provision for impairment of trade receivables are as follows:
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
At January 1, as reported |
|
17 |
|
23 |
|
15 |
Impact of adoption of IFRS 9 on January 1, 2018 |
|
— |
|
(4) |
|
— |
At January 1, |
|
17 |
|
19 |
|
15 |
Provision for receivables impairment |
|
7 |
|
2 |
|
6 |
Receivables written off during the year as uncollectible |
|
— |
|
(3) |
|
— |
Disposal of Food & Specialty |
|
(18) |
|
— |
|
— |
Exchange |
|
— |
|
(1) |
|
2 |
At December 31, |
|
6 |
|
17 |
|
23 |
The majority of the provision above relates to balances which are more than six months past due. The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable set out above.
Provisions against specific balances
Significant balances are assessed for evidence of increased credit risk. Examples of factors considered are high probability of bankruptcy, breaches of contract or major concession being sought by the customer. Instances of significant single customer related bad debts are rare and there is no significant concentration of risk associated with particular customers.
Providing against the remaining population of customers
The Group monitors actual historical credit losses and adjusts for forward-looking information to measure the level of expected losses. Adverse changes in the payment status of customers of the Group, or national or local economic conditions that correlate with defaults on receivables owing to the Group, may also provide a basis for an increase in the level of provision above historic loss experience.
As of December 31, 2019, trade receivables of $34 million (2018: $68 million) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Up to three months past due |
|
28 |
|
56 |
Three to six months past due |
|
1 |
|
5 |
Over six months past due |
|
5 |
|
7 |
|
|
34 |
|
68 |
Ardagh Group S.A.
F-43
16. Contract assets
The following table provides information about significant changes in contract assets:
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
At January 1, |
|
160 |
|
168 |
Transfers from contract assets recognized at beginning of year to receivables |
|
(155) |
|
(168) |
Increases as a result of new contract assets recognized during the year |
|
175 |
|
157 |
Decrease due to disposal of Food & Specialty |
|
(32) |
|
— |
Other |
|
3 |
|
3 |
At December 31, |
|
151 |
|
160 |
17. Cash and cash equivalents
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Cash at bank and in hand |
|
598 |
|
494 |
Short term bank deposits |
|
11 |
|
26 |
Restricted cash |
|
5 |
|
10 |
|
|
614 |
|
530 |
Within cash and cash equivalents, the Group had $5 million of restricted cash at December 31, 2019 (2018: $10 million).
18. Issued capital and reserves
Share capital
Issued and fully paid shares:
|
|
|
|
|
|
|
|
|
|
|
Class A
|
|
Class B
|
|
Total shares |
|
Total |
|
|
(million) |
|
(million) |
|
(million) |
|
$'m |
At December 31, 2018 |
|
18.65 |
|
217.70 |
|
236.35 |
|
23 |
Share issuance |
|
0.01 |
|
– |
|
0.01 |
|
– |
At December 31, 2019 |
|
18.66 |
|
217.70 |
|
236.36 |
|
23 |
2019
There were no material share transactions in the year ended December 31, 2019 or the year ended December 31, 2018.
Ardagh Group S.A.
F-44
19. Financial risk factors
The Group’s activities expose it to a variety of financial risks: capital risk, interest rate risk, currency exchange risk, commodity price risk, credit risk, and liquidity risk.
Capital structure and risk
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and provide returns to its shareholders. The Group funds its operations primarily from the following sources of capital: borrowings, cash flow and shareholders’ capital. The Group aims to achieve a capital structure that results in an appropriate cost of capital to accommodate material investments or acquisitions, while providing flexibility in short and medium term funding. The Group also aims to maintain a strong balance sheet and to provide continuity of financing by having a range of maturities and borrowing from a variety of sources.
The Group’s overall treasury objectives are to ensure sufficient funds are available for the Group to carry out its strategy and to manage certain financial risks to which the Group is exposed, details of which are provided below.
Financial risks are managed on the advice of Group Treasury and senior management. The Group does not permit the use of treasury instruments for speculative purposes, under any circumstances. Group Treasury regularly reviews the level of cash and debt facilities required to fund the Group’s activities, plans for repayment and refinancing of debt, and identifies an appropriate amount of headroom to provide a reserve against unexpected funding requirements.
Additionally, financial instruments, including derivative financial instruments, are used to hedge exposure to interest rate, currency exchange risk and commodity price risk.
One of the Group’s key metrics has been the ratio of consolidated external net debt as a multiple of Adjusted EBITDA. Adjusted EBITDA is the profit or loss for the period before income tax charge or credit, net finance expense, depreciation and amortization, exceptional operating items and share of profit or loss in equity accounted joint venture. As at December 31, 2019 the ratio was 4.5x (2018: 5.0x; 2017: 5.2x).
Interest rate risk
The Board’s policy, in the management of interest rate risk, is to strike the right balance between the Group’s fixed and floating rate financial instruments, which occasionally includes the use of CCIRS. The balance struck by the Board is dependent on prevailing interest rate markets at any point in time.
At December 31, 2019, the Group’s external borrowings were 88.1% (2018: 90.1%) fixed, with a weighted average interest rate of 4.6% (2018: 5.4%; 2017: 5.5%). The weighted average interest rate for the Group for the year ended December 31, 2019 was 4.0% (2018: 5.0%; 2017: 4.9%).
Holding all other variables constant, including levels of the Group’s external indebtedness, at December 31, 2019 a one percentage point increase in variable interest rates would increase interest payable by approximately $11 million (2018: $9 million).
Currency exchange risk
The Group presents its consolidated financial information in U.S. dollar. The functional currency of the Company will continue to be the euro.
The Group operates in 12 countries, across three continents and its main currency exposure in the year to December 31, 2019, from the euro functional currency, was in relation to the U.S. dollar, British pound, Swedish krona,
Ardagh Group S.A.
F-45
Polish zloty, Danish krone and Brazilian real. Currency exchange risk arises from future commercial transactions, recognized assets and liabilities, and net investments in foreign operations.
As a result of the consolidated financial statements being presented in U.S dollar, the Group’s results are also impacted by fluctuations in the U.S. dollar exchange rate versus the euro.
The Group has a limited level of transactional currency exposure arising from sales or purchases by operating units in currencies other than their functional currencies.
The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed primarily through borrowings and swaps denominated in the Group’s principal foreign currencies.
Fluctuations in the value of these currencies with respect to the euro functional currency may have a significant impact on the Group’s financial condition and results of operations. The Group believes that a strengthening of the euro exchange rate (the functional currency) by 1% against all other foreign currencies from the December 31, 2019 rate would decrease shareholders’ equity by approximately $4 million (2018: $2 million decrease).
The Group is exposed to changes in prices of our main raw materials, primarily energy, aluminum and steel. Production costs in our Metal Beverage Packaging division are exposed to changes in prices of our main raw materials, primarily aluminum and steel. Aluminum ingot is traded daily as a commodity on the London Metal Exchange, which has historically been subject to significant price volatility. Because aluminum is priced in U.S. dollars, fluctuations in the U.S. dollar/ euro rate also affect the euro cost of aluminum ingot. The price and foreign currency risk on the aluminum purchases in Metal Beverage Packaging Europe and Metal Beverage Packaging Americas are hedged by entering into swaps under which we pay fixed euro and U.S. dollar prices, respectively. Steel price has a variable cost associated with its raw material components, coking coal and iron ore. Similarly to aluminum ingots, coking coal and iron ore are priced in U.S. dollars. The price and foreign currency risk on the steel purchases in Metal Beverage Packaging Europe are hedged by entering into swaps under which we pay fixed euro. The hedging market for coking coal is a relatively new market which does not have the depth of the aluminum market and as a consequence, there might be limitations to placing hedges in the market. Furthermore, the relative price of oil and its by products may materially impact our business, affecting our transport, lacquer and ink costs.
Where we do not have pass through contracts in relation to the underlying metal raw material cost the Group uses derivative agreements to manage this risk. The Group depends on an active liquid market and available credit lines with counterparty banks to cover this risk. The use of derivative contracts to manage our risk is dependent on robust hedging procedures. Increasing raw material costs over time has the potential, if we are unable to pass on price increases, to reduce sales volume and could therefore have a significant impact on our financial condition. The Group is also exposed to possible interruptions of supply of aluminum and steel or other raw materials and any inability to purchase raw materials could negatively impact our operations.
Production costs in our Glass Packaging division are sensitive to the price of energy. Our main energy exposure is to the cost of gas and electricity. These energy costs have experienced significant volatility in recent years with a corresponding effect on our production costs. In terms of gas, which represents 50% of our energy costs, there is a continuous de‑coupling between the cost of gas and oil, whereby now only significant changes in the price of oil have an impact on the price of gas. The volatility in gas pricing is driven by shale gas development (United States only), the availability of liquefied natural gas in Europe, as both Europe and Asia compete for shipments, and storage levels. Volatility in the price of electricity is caused by the German Renewable Energy policy, the phasing out of nuclear generating capacity, fluctuations in the price of gas and coal and the influence of carbon dioxide costs on electricity prices.
Ardagh Group S.A.
F-46
As a result of the volatility of gas and electricity prices, the Group has either included energy pass‑through clauses in our sales contracts or developed an active hedging strategy to fix a significant proportion of our energy costs through contractual arrangements directly with our suppliers, where there is no energy clause in the sales contract.
Where pass through contracts do not exist, the Group policy is to purchase gas and electricity by entering into forward price fixing arrangements with suppliers for the bulk of our anticipated requirements for the year ahead. Such contracts are used exclusively to obtain delivery of our anticipated energy supplies. The Group does not net settle, nor do we sell within a short period of time after taking delivery. The Group avails of the own use exemption and, therefore, these contracts are treated as executory contracts.
The Group typically builds up these contractual positions in tranches of approximately 10% of the anticipated volumes. Any gas and electricity which is not purchased under forward price‑fixing arrangements is purchased under index tracking contracts or at spot prices. As at December 31, 2019, we have 92% and 59% of our energy risk covered for 2020 and 2021, respectively.
Credit risk
Credit risk arises from derivative contracts, cash and deposits held with banks and financial institutions, as well as credit exposures to the Group’s customers, including outstanding receivables. Group policy is to place excess liquidity on deposit, only with recognized and reputable financial institutions. For banks and financial institutions, only independently rated parties with a minimum rating of “BBB+” from at least two credit rating agencies are accepted, where possible. The credit ratings of banks and financial institutions are monitored to ensure compliance with Group policy. Risk of default is controlled within a policy framework of dealing with high quality institutions and by limiting the amount of credit exposure to any one bank or institution.
Group policy is to extend credit to customers of good credit standing. Credit risk is managed on an on‑going basis, by experienced people within the Group. The Group’s policy for the management of credit risk in relation to trade receivables involves periodically assessing the financial reliability of customers, taking into account their financial position, past experience and other factors. Provisions are made, where deemed necessary, and the utilization of credit limits is regularly monitored. Management does not expect any significant counterparty to fail to meet its obligations. The maximum exposure to credit risk is represented by the carrying amount of each asset. For the year ended December 31, 2019, the Group’s ten largest customers accounted for approximately 47% of total revenues from continuing operations (2018: 48%; 2017: 42%). There is no recent history of default with these customers.
Surplus cash held by the operating entities over and above the balance required for working capital management is transferred to Group Treasury. Group Treasury invests surplus cash in interest‑bearing current accounts and time deposits with appropriate maturities to provide sufficient headroom as determined by the below‑mentioned forecasts.
Liquidity risk
The Group is exposed to liquidity risk which arises primarily from the maturing of short term and long term debt obligations and from the normal liquidity cycle of the business throughout the course of a year. The Group’s policy is to ensure that sufficient resources are available either from cash balances, cash flows or undrawn committed bank facilities, to ensure all obligations can be met as they fall due.
To effectively manage liquidity risk, the Group:
|
· |
|
has committed borrowing facilities that it can access to meet liquidity needs; |
|
· |
|
maintains cash balances and liquid investments with highly‑rated counterparties; |
Ardagh Group S.A.
F-47
|
· |
|
limits the maturity of cash balances; |
|
· |
|
borrows the bulk of its debt needs under long term fixed rate debt securities; and |
|
· |
|
has internal control processes to manage liquidity risk. |
Cash flow forecasting is performed in the operating entities of the Group and is aggregated by Group Treasury. Group Treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans.
Ardagh Group S.A.
F-48
20. Financial assets and liabilities
The Group’s net external debt was as follows:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Loan notes |
|
5,529 |
|
7,737 |
Other borrowings |
|
381 |
|
142 |
Total borrowings |
|
5,910 |
|
7,879 |
Cash and cash equivalents |
|
(614) |
|
(530) |
Derivative financial instruments used to hedge foreign currency and interest rate risk |
|
32 |
|
113 |
Net debt |
|
5,328 |
|
7,462 |
The Group’s net borrowings of $5,910 million (2018: $7,879 million) are classified as non-current liabilities of $5,815 million (2018: $7,761 million) and current liabilities of $95 million (2018: $118 million) in the consolidated statement of financial position at December 31, 2019.
At December 31, 2019, the Group’s net debt and available liquidity was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum |
|
Final |
|
|
|
|
|
|
|
|
|
|
|
|
amount |
|
maturity |
|
Facility |
|
|
|
|
|
Undrawn |
Facility |
|
Currency |
|
drawable |
|
date |
|
type |
|
Amount drawn |
|
amount |
||
|
|
|
|
Local |
|
|
|
|
|
Local |
|
|
|
|
|
|
|
|
currency |
|
|
|
|
|
currency |
|
$'m |
|
$'m |
|
|
|
|
m |
|
|
|
|
|
m |
|
|
|
|
2.750% Senior Secured Notes |
|
EUR |
|
741 |
|
15-Mar-24 |
|
Bullet |
|
741 |
|
832 |
|
– |
4.250% Senior Secured Notes |
|
USD |
|
695 |
|
15-Sep-22 |
|
Bullet |
|
695 |
|
695 |
|
– |
2.125% Senior Secured Notes |
|
EUR |
|
439 |
|
15-Aug-26 |
|
Bullet |
|
439 |
|
493 |
|
– |
4.125% Senior Secured Notes |
|
USD |
|
500 |
|
15-Aug-26 |
|
Bullet |
|
500 |
|
500 |
|
– |
4.750% Senior Notes |
|
GBP |
|
400 |
|
15-Jul-27 |
|
Bullet |
|
400 |
|
528 |
|
– |
6.000% Senior Notes |
|
USD |
|
1,700 |
|
15-Feb-25 |
|
Bullet |
|
1,700 |
|
1,708 |
|
– |
5.250% Senior Notes |
|
USD |
|
800 |
|
15-Aug-27 |
|
Bullet |
|
800 |
|
800 |
|
– |
Global Asset Based Loan Facility |
|
USD |
|
663 |
|
07-Dec-22 |
|
Revolving |
|
– |
|
– |
|
663 |
Lease obligations |
|
Various |
|
– |
|
|
|
Amortizing |
|
– |
|
364 |
|
– |
Other borrowings/credit lines |
|
EUR/USD |
|
– |
|
Rolling |
|
Amortizing |
|
– |
|
22 |
|
1 |
Total borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
5,942 |
|
664 |
Deferred debt issue costs and bond premium |
|
|
|
|
|
|
|
|
|
|
|
(32) |
|
– |
Net borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
5,910 |
|
664 |
Cash and cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
(614) |
|
614 |
Derivative financial instruments used to hedge foreign currency and interest rate risk |
|
|
|
|
|
|
|
|
|
|
|
32 |
|
– |
Net debt / available liquidity |
|
|
|
|
|
|
|
|
|
|
|
5,328 |
|
1,278 |
Net debt includes the fair value of associated derivative financial instruments that are used to hedge foreign exchange and interest rate risks relating to finance debt.
Certain of the Group’s borrowing agreements contain certain covenants that restrict the Group’s flexibility in certain areas such as incurrence of additional indebtedness (primarily maximum borrowings to Adjusted EBITDA and a minimum Adjusted EBITDA to interest expense), payment of dividends and incurrence of liens. The Global Asset Based Loan Facility is subject to a number of financial covenants including a fixed charge coverage ratio. The facility also
Ardagh Group S.A.
F-49
includes cash dominion, representations, warranties, events of default and other covenants that are generally of a nature customary for such facilities.
At December 31, 2018, the Group’s net debt and available liquidity was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum |
|
Final |
|
|
|
|
|
|
|
|
|
|
|
|
amount |
|
maturity |
|
Facility |
|
|
|
|
|
Undrawn |
Facility |
|
Currency |
|
drawable |
|
date |
|
type |
|
Amount drawn |
|
amount |
||
|
|
|
|
Local |
|
|
|
|
|
Local |
|
$'m |
|
$'m |
|
|
|
|
currency |
|
|
|
|
|
currency |
|
|
|
|
|
|
|
|
m |
|
|
|
|
|
m |
|
|
|
|
2.750% Senior Secured Notes |
|
EUR |
|
|
|
15-Mar-24 |
|
Bullet |
|
750 |
|
859 |
|
— |
4.625% Senior Secured Notes |
|
USD |
|
|
|
15-May-23 |
|
Bullet |
|
1,000 |
|
1,000 |
|
— |
4.125% Senior Secured Notes |
|
EUR |
|
|
|
15-May-23 |
|
Bullet |
|
440 |
|
504 |
|
— |
4.250% Senior Secured Notes |
|
USD |
|
|
|
15-Sep-22 |
|
Bullet |
|
715 |
|
715 |
|
— |
4.750% Senior Notes |
|
GBP |
|
|
|
15-Jul-27 |
|
Bullet |
|
400 |
|
512 |
|
— |
6.000% Senior Notes |
|
USD |
|
|
|
15-Feb-25 |
|
Bullet |
|
1,700 |
|
1,685 |
|
— |
7.250% Senior Notes |
|
USD |
|
|
|
15-May-24 |
|
Bullet |
|
1,650 |
|
1,650 |
|
— |
6.750% Senior Notes |
|
EUR |
|
|
|
15-May-24 |
|
Bullet |
|
750 |
|
859 |
|
— |
Global Asset Based Loan Facility |
|
USD |
|
|
|
07-Dec-22 |
|
Revolving |
|
— |
|
100 |
|
639 |
Finance lease obligations |
|
Various |
|
— |
|
|
|
Amortizing |
|
— |
|
36 |
|
— |
Other borrowings/credit lines |
|
EUR/USD |
|
— |
|
Rolling |
|
Amortizing |
|
— |
|
15 |
|
1 |
Total borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
7,935 |
|
640 |
Deferred debt issue costs and bond premium |
|
|
|
|
|
|
|
|
|
|
|
(56) |
|
— |
Net borrowings / undrawn facilities |
|
|
|
|
|
|
|
|
|
|
|
7,879 |
|
640 |
Cash and cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
(530) |
|
530 |
Derivative financial instruments used to hedge foreign currency and interest rate risk |
|
|
|
|
|
|
|
|
|
|
|
113 |
|
— |
Net debt / available liquidity |
|
|
|
|
|
|
|
|
|
|
|
7,462 |
|
1,170 |
The following table summarizes movement in the Group’s net debt:
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Net (increase)/decrease in cash and cash equivalents per consolidated statement of cash flows |
|
(84) |
|
254 |
Decrease in net borrowings and derivative financial instruments |
|
(2,050) |
|
(617) |
Decrease in net debt |
|
(2,134) |
|
(363) |
Net debt at January 1, |
|
7,462 |
|
7,825 |
Net debt at December 31, |
|
5,328 |
|
7,462 |
The decrease in net borrowings and derivative financial instruments primarily includes repayments of borrowings of $4.1 billion (2018: $0.4 billion), proceeds from borrowings of $1.8 billion (2018: $0.1 billion), an increase in lease obligations of $0.3 billion (2018: $nil), a fair value gain on derivative financial instruments used to hedge foreign currency and interest rate risk of $0.1 billion (2018: gain of $0.2 billion) which partially offsets a corresponding foreign exchange loss on borrowings of $0.1 billion (2018: loss of $0.2 billion), and an increase to cash and cash equivalents of $0.1 billion (2018: decrease of $0.3 billion).
Ardagh Group S.A.
F-50
The maturity profile of the Group’s borrowings is as follows:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Within one year or on demand |
|
95 |
|
118 |
Between one and three years |
|
796 |
|
4 |
Between three and five years |
|
897 |
|
2,213 |
Greater than five years |
|
4,122 |
|
5,544 |
|
|
5,910 |
|
7,879 |
The maturity profile of the contractual undiscounted cash flows related to the Group’s lease liabilities as of December 31, 2019, is as follows:
|
|
|
|
|
$'m |
Not later than one year |
|
|
Later than one year and not later than five years |
|
|
Later than five years |
|
|
|
|
|
The table below analyzes the Group’s financial liabilities (including interest payable) into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contracted undiscounted cash flows.
|
|
|
|
|
|
|
|
|
|
|
Derivative |
|
Trade and |
|
|
|
|
financial |
|
other |
|
|
Borrowings |
|
instruments |
|
payables |
At December 31, 2019 |
|
$'m |
|
$'m |
|
$'m |
Within one year or on demand |
|
363 |
|
17 |
|
1,519 |
Between one and three years |
|
1,328 |
|
9 |
|
— |
Between three and five years |
|
1,345 |
|
35 |
|
— |
Greater than five years |
|
4,426 |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
Derivative |
|
Trade and |
|
|
|
|
financial |
|
other |
|
|
Borrowings |
|
instruments |
|
payables |
|
|
$'m |
|
$'m |
|
$'m |
At December 31, 2018 |
|
Re-presented |
|
|
|
|
Within one year or on demand |
|
541 |
|
38 |
|
1,872 |
Between one and three years |
|
859 |
|
2 |
|
— |
Between three and five years |
|
3,000 |
|
105 |
|
— |
Greater than five years |
|
5,845 |
|
— |
|
— |
Ardagh Group S.A.
F-51
The carrying amount and fair value of the Group’s borrowings excluding lease obligations are as follows:
|
|
|
|
|
|
|
|
|
|
|
Carrying value |
|
|
||||
|
|
|
|
Deferred debt |
|
|
|
|
|
|
Amount |
|
issue costs and |
|
|
|
|
|
|
drawn |
|
premium |
|
Total |
|
Fair value |
At December 31, 2018 |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Loan notes |
|
7,784 |
|
(46) |
|
7,738 |
|
7,563 |
Global Asset Based Loan Facility and other borrowings |
|
|
|
(10) |
|
105 |
|
115 |
|
|
7,899 |
|
(56) |
|
7,843 |
|
7,678 |
Financing activity
2019
Lease obligations of $364 million primarily reflect increases related to $349 million lease liabilities due to initial adoption of IFRS 16 as of January 1, 2019, as well as $169 million of new lease liabilities, partly offset by $84 million of lease liabilities divested at October 31, 2019, $78 million of principal repayments in continuing operations and $14 million of principal repayments in discontinued operation in the year ended December 31, 2019.
On August 12, 2019, the Group issued €440 million 2.125% Senior Secured Notes due 2026, $500 million 4.125% Senior Secured Notes due 2026, and $800 million 5.250% Senior Notes due 2027. The net proceeds from the issuance of these notes were used to redeem on August 13, 2019 the $1,650 million 7.250% Senior Notes due 2024 and to pay applicable redemption premiums and accrued interest in accordance with their terms.
Following the completion of the combination of its Food & Specialty business with the business of Exal, on October 31, 2019, the Group issued tender offers, at par, in respect of its $715 million 4.250% Senior Secured Notes due 2022, €750 million 2.750% Senior Secured Notes due 2024, €440 million 2.125% Senior Secured Notes due 2026 and $500 million 4.125% Senior Secured Notes due 2026. Following the expiration of the offer on November 28, 2019 notice was given to repurchase the following amounts, $20 million of the $715 million 4.250% Senior Secured Notes due 2022, €9 million of the €750 million 2.750% Senior Secured Notes due 2024, and €1 million of the €440 million 2.125% Senior Secured Notes due 2026. On December 2, 2019, in accordance with the terms of the offer, the redemptions were completed.
On November 14, 2019, the Group redeemed $1,000 million 4.625% Senior Secured Notes due 2023 and €440 million 4.125% Senior Secured Notes due 2023, and paid the applicable redemption premiums and accrued interest in accordance with their terms.
On November 29, 2019, the Group redeemed €750 million 6.750% Senior Notes due 2024 and paid the applicable redemption premium and accrued interest in accordance with their terms.
As at December 31, 2019, the Group had $663 million available under the Global Asset Based Loan Facility. During 2019, the Group reduced the facility size from $850 million to $700 million as a result of the disposal of the Food & Specialty Metal Packaging business.
Ardagh Group S.A.
F-52
2018
On July 31, 2018, the Group redeemed in full its $440 million 6.000% Senior Notes due 2021 and paid applicable redemption premium and accrued interest in accordance with their terms. The redemption was funded by a combination of cash-on-hand and available liquidity, drawing from the Group’s Global Asset Based Loan Facility.
As at December 31, 2018, the Group had $639 million available under the Global Asset Based Loan Facility.
The effective interest rates of borrowings at the reporting date are as follows:
The carrying amounts of the Group’s net borrowings are denominated in the following currencies:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Euro |
|
1,411 |
|
2,221 |
U.S. dollar |
|
3,909 |
|
5,149 |
British pound |
|
559 |
|
509 |
Other |
|
31 |
|
— |
|
|
5,910 |
|
7,879 |
The Group has the following undrawn borrowing facilities:
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Expiring within one year |
|
1 |
|
1 |
Expiring beyond one year |
|
663 |
|
639 |
|
|
664 |
|
640 |
Ardagh Group S.A.
F-53
Fair value methodology
The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments:
Level 1Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices).
Fair values are calculated as follows:
|
(i) |
|
Senior secured and senior notes - The fair value of debt securities in issue is based on valuation techniques in which all significant inputs are based on observable market data. In the year ended December 31, 2019 the classification for all senior secured and senior notes was changed from Level 1 to Level 2 based on management’s assessment that quoted prices in the market for such debt securities are not regularly available. |
|
(ii) |
|
Global Asset Based Loan facility and other borrowings - The estimated value of fixed interest bearing deposits is based on discounted cash flows using prevailing money-market interest rates for debts with similar credit risk and remaining maturity and represents Level 2 inputs. |
|
(iii) |
|
Cross currency interest rate swaps (“CCIRS”) - The fair values of the CCIRS are based on quoted market prices and represent Level 2 inputs. |
|
(iv) |
|
Commodity and foreign exchange derivatives - The fair value of these derivatives are based on quoted market prices and represent Level 2 inputs. |
Derivative financial instruments
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
Liabilities |
||||
|
|
|
|
Contractual |
|
|
|
Contractual |
|
|
|
|
or notional |
|
|
|
or notional |
|
|
Fair values |
|
amounts |
|
Fair values |
|
amounts |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Fair value derivatives |
|
|
|
|
|
|
|
|
Metal forward contracts |
|
4 |
|
100 |
|
10 |
|
252 |
Cross currency interest rate swaps |
|
3 |
|
600 |
|
35 |
|
913 |
Forward foreign exchange contracts |
|
— |
|
31 |
|
13 |
|
351 |
NYMEX gas swaps |
|
— |
|
3 |
|
3 |
|
24 |
At December 31, 2019 |
|
7 |
|
734 |
|
61 |
|
1,540 |
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
Liabilities |
||||
|
|
|
|
Contractual |
|
|
|
Contractual |
|
|
|
|
or notional |
|
|
|
or notional |
|
|
Fair values |
|
amounts |
|
Fair values |
|
amounts |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Fair value derivatives |
|
|
|
|
|
|
|
|
Metal forward contracts |
|
9 |
|
79 |
|
22 |
|
262 |
Cross currency interest rate swap |
|
9 |
|
282 |
|
122 |
|
2,219 |
Forward foreign exchange contracts |
|
2 |
|
354 |
|
1 |
|
98 |
NYMEX gas swaps |
|
— |
|
7 |
|
— |
|
8 |
At December 31, 2018 |
|
20 |
|
722 |
|
145 |
|
2,587 |
For metal forward contracts with a notional amount of $22 million and a fair value of $1 million, offsetting derivatives with identical terms are in place with Trivium.
Derivative instruments with a fair value of $4 million (2018: $11 million) are classified as non-current assets and $3 million (2018: $9 million) as current assets in the consolidated statement of financial position at December 31, 2019. Derivative instruments with a fair value of $44 million (2018: $107 million) are classified as non-current liabilities and
Ardagh Group S.A.
F-54
$17 million (2018: $38 million) as current liabilities in the consolidated statement of financial position at December 31, 2019.
The majority of derivative assets and liabilities are non-current, including certain of the Group’s CCIRS which mature at dates between August 2021 and November 2025 and certain metal forward contracts which mature at dates between January 2021 and December 2022.
With the exception of interest on the CCIRS, all cash payments in relation to derivative instruments are paid or received when they mature. Bi‑annual and quarterly interest cash payments and receipts are made and received in relation to the CCIRS.
The Group mitigates the counterparty risk for derivatives by contracting with major financial institutions which have high credit ratings.
Cross currency interest rate swaps
2019
The Group hedges certain of its external borrowings and interest payable thereon using cross-currency interest rate swaps (“CCIRS”), with a net asset at December 31, 2019 of $32 million (December 31, 2018: $113 million net liability).
On February 15, 2019 the Group’s $200 million U.S dollar to euro CCIRS matured. The fair value of these swaps at maturity was $14 million and the cash settlement of these swaps was $14 million. The Group entered into new $200 million U.S dollar to euro CCIRS on March 1, 2019.
On August 12, 2019, the Group terminated a number of CCIRS. The total fair value of these swaps at termination was $17 million and the cash receipt on these swaps was $23 million. The Group entered into a new $500 million U.S dollar to euro CCIRS on August 12, 2019.
2018
The Group hedges certain portions of its external borrowings and interest payable thereon using CCIRS, with a net liability at December 31, 2018 of $113 million (December 31, 2017: $301 million).
On July 11, 2018, the Group terminated its $440 million U.S. dollar to euro CCIRS, due for maturity in 2019. The Group paid net consideration of $44 million on termination and recognized a related exceptional loss of $6 million (Note 4).
Net investment hedge in foreign operations
The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed primarily through borrowings denominated in the relevant foreign currencies.
Hedges of net investments in foreign operations are accounted for whereby any gain or loss on the hedging instruments relating to the effective portion of the hedge is recognized in other comprehensive income. The gain or loss relating to an ineffective portion is recognized immediately in the consolidated income statement within finance income or expense respectively. Gains and losses accumulated in other comprehensive income are recycled to the consolidated income statement when the foreign operation is disposed of. The amount that has been recognized in the consolidated income statement due to ineffectiveness is $1 million (2018: $nil; 2017: $nil).
Ardagh Group S.A.
F-55
Metal forward contracts
The Group hedges a substantial portion of its anticipated metal purchases. Excluding conversion and freight costs, the physical metal deliveries are priced based on the applicable indices agreed with the suppliers for the relevant month.
Fair values have been based on quoted market prices and are valued using Level 2 valuation inputs. The fair value of these contracts when initiated is $nil; no premium is paid or received.
Forward foreign exchange contracts
The Group operates in a number of currencies and, accordingly, hedges a portion of its currency transaction risk. The fair values are based on Level 2 valuation techniques and observable inputs including the contract prices. The fair value of these contracts when initiated is $nil; no premium is paid or received.
NYMEX gas swaps
The Group hedges a portion of its Glass Packaging North America anticipated energy purchases on the New York Mercantile Exchange (“NYMEX”).
Fair values have been based on NYMEX‑quoted market prices and Level 2 valuation inputs have been applied. The fair value of these contracts when initiated is $nil; no premium is paid or received.
21. Employee benefit obligations
The Group operates defined benefit or defined contribution pension schemes in most of its countries of operation and the assets are held in separately administered funds. The principal funded defined benefit schemes, which are funded by contributions to separately administered funds, are in the United States and the United Kingdom.
Other defined benefit schemes are unfunded and the provision is recognized in the consolidated statement of financial position. The principal unfunded schemes are in Germany.
The contribution rates to the funded plans are agreed with the Trustee boards, plan actuaries and the local pension regulators periodically. The contributions paid in 2019 were those recommended by the actuaries.
In addition, the Group has other employee benefit obligations in certain territories.
Total employee obligations recognized in the consolidated statement of financial position of $716 million (2018: $957 million) includes other employee benefit obligations of $101 million (2018: $127 million).
The employee obligations and assets of the defined benefit schemes included in the consolidated statement of financial position are analyzed below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. |
|
Germany |
|
UK |
|
Other |
|
Total |
||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Obligations |
|
(1,318) |
|
(1,217) |
|
(176) |
|
(386) |
|
(830) |
|
(862) |
|
(25) |
|
(38) |
|
(2,349) |
|
(2,503) |
Assets |
|
1,139 |
|
1,040 |
|
— |
|
— |
|
585 |
|
624 |
|
10 |
|
9 |
|
1,734 |
|
1,673 |
Net obligations |
|
(179) |
|
(177) |
|
(176) |
|
(386) |
|
(245) |
|
(238) |
|
(15) |
|
(29) |
|
(615) |
|
(830) |
Ardagh Group S.A.
F-56
Defined benefit pension schemes
The amounts recognized in the consolidated income statement are:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Current service cost and administration costs: |
|
|
|
|
|
|
Cost of sales - current service cost (Note 8) |
|
(28) |
|
(38) |
|
(33) |
Cost of sales - past service credit/(charge) (Note 8) |
|
54 |
|
(6) |
|
— |
SGA - current service cost (Note 8) |
|
(3) |
|
(4) |
|
(3) |
|
|
23 |
|
(48) |
|
(36) |
Finance expense (Note 5) |
|
(18) |
|
(16) |
|
(18) |
|
|
5 |
|
(64) |
|
(54) |
Discontinued operation |
|
1 |
|
— |
|
(6) |
|
|
6 |
|
(64) |
|
(60) |
The amounts recognized in the consolidated statement of comprehensive income are:
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Re-measurement of defined benefit obligation: |
|
|
|
|
|
|
Actuarial (loss)/gain arising from changes in demographic assumptions |
|
(4) |
|
18 |
|
(3) |
Actuarial (loss)/gain arising from changes in financial assumptions |
|
(272) |
|
116 |
|
(85) |
Actuarial (loss)/gain arising from changes in experience |
|
(23) |
|
19 |
|
(1) |
|
|
(299) |
|
153 |
|
(89) |
Re-measurement of plan assets: |
|
|
|
|
|
|
Actual return/(loss) less expected return on plan assets |
|
203 |
|
(144) |
|
129 |
Actuarial (loss)/gain for the year on defined benefit pension schemes |
|
(96) |
|
9 |
|
40 |
Actuarial (loss)/gain on other long term and end of service employee benefits |
|
(6) |
|
6 |
|
(2) |
|
|
(102) |
|
15 |
|
38 |
Discontinued operation |
|
(38) |
|
(4) |
|
11 |
|
|
(140) |
|
11 |
|
49 |
The actual return on plan assets was a gain of $271 million in 2019 (2018: $96 million loss; 2017: $228 million gain).
Ardagh Group S.A.
F-57
Movement in the defined benefit obligations and assets:
|
|
|
|
|
|
|
|
|
|
|
At December 31, |
||||||
|
|
Obligations |
Assets |
|||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
At January 1, |
|
(2,503) |
|
(2,762) |
|
1,673 |
|
1,897 |
Interest income |
|
— |
|
— |
|
54 |
|
55 |
Current service cost |
|
(28) |
|
(40) |
|
— |
|
— |
Past service credit |
|
62 |
|
3 |
|
— |
|
— |
Interest cost |
|
(72) |
|
(72) |
|
— |
|
— |
Administration expenses paid from plan assets |
|
— |
|
— |
|
(1) |
|
(1) |
Re-measurements |
|
(351) |
|
157 |
|
217 |
|
(151) |
Employer contributions |
|
— |
|
— |
|
47 |
|
52 |
Benefits paid |
|
151 |
|
140 |
|
(151) |
|
(140) |
Disposal of Food & Specialty |
|
408 |
|
— |
|
(123) |
|
— |
Exchange |
|
(16) |
|
71 |
|
18 |
|
(39) |
At December 31, |
|
(2,349) |
|
(2,503) |
|
1,734 |
|
1,673 |
The defined benefit obligations above include $182 million (2018: $403 million) of unfunded obligations. Employer contributions above include no contributions under schemes extinguished during the year (2018: $nil). The defined benefit obligations above also include a movement of $17 million relating to the disposed Food & Specialty Metal Packaging business which had a defined obligation of $285 million at October 31, 2019. The above movements include $3 million current service costs (2018: $4 million), $8 million of a past service credit (2018: $9 million), $4 million net interest expense (2018: $5 million), $38 million of remeasurement losses (2018: $3 million of remeasurement gains) and $14 million of benefits paid (2018: $20 million) relating to the Food & Specialty Metal Packaging business.
Interest income and interest cost above does not include interest cost of $3 million (2018: $4 million; 2017: $3 million) relating to other employee benefit obligations. Current service costs above does not include current service costs of $7 million (2018: $6 million) relating to other employee benefit obligations.
During the year ended December 31, 2019, the Group elected to re-design the pension plans in Metal Beverage Packaging Germany, moving from a current defined benefit scheme into a contribution orientated scheme. This resulted in the recognition of a past service credit of $17 million in the year within the income statement. During the year ended December 31, 2019, as part of the 2019 Collective Bargaining Agreement, Glass Packaging North America successfully concluded a process involving the hourly defined benefit pension plan, moving to a future service only plan. This resulted in the recognition of an exceptional gain of $37 million within the income statement for the year ended December 31, 2019. There was also an $8 million past service credit recognized in October 2019 in respect of the second step in the redesign of the pension scheme in Germany which is noted below.
During the year ended December 31, 2018, the Group elected to re-design one of its pension schemes in Germany, moving from a defined benefit pension scheme to a contribution orientated system. This amendment resulted in the recognition of a past service credit of $12 million (2017: $nil) in the year within cost of sales. The past service credit was partly offset by a past service cost of $8 million (2017: $nil) following a high court judgment in the U.K. in October 2018 guaranteeing gender equality in U.K. pension schemes for accrued benefits (“GMP Equalization”) and a further $1 million past service cost arising from amendments to the defined benefit pension scheme in Metal Beverage U.K. during the year. The GMP equalization past service cost has been recognized as exceptional within the income statement for the year ended December 31, 2018.
Ardagh Group S.A.
F-58
Plan assets comprise:
|
|
|
|
|
|
|
|
|
|
|
At December 31, |
||||||
|
|
2019 |
|
2019 |
|
2018 |
|
2018 |
|
|
$'m |
|
% |
|
$'m |
|
% |
Equities / multi strategy |
|
1,107 |
|
|
|
1,039 |
|
|
Target return funds |
|
267 |
|
|
|
267 |
|
|
Bonds |
|
178 |
|
|
|
184 |
|
|
Cash/other |
|
182 |
|
|
|
183 |
|
|
|
|
1,734 |
|
100 |
|
1,673 |
|
100 |
The pension assets do not include any of the Company’s ordinary shares, securities or other Group assets.
Investment strategy
The choice of investments takes account of the expected maturity of the future benefit payments. The plans invest in diversified portfolios consisting of an array of asset classes that attempt to maximize returns while minimizing volatility. The asset classes include national and international equities, fixed income government and non‑government securities and real estate, as well as cash.
Characteristics and associated risks
Glass Packaging North America and Metal Beverage Packaging Americas each sponsor a defined benefit pension plan which is subject to Federal law (“ERISA”), reflecting regulations issued by the Internal Revenue Service (“IRS”) and the U.S. Department of Labor.
The Glass Packaging North America plan covers both hourly and salaried employees. The plan benefits are determined using a formula which reflects an employee’s years of service and either their final average salary or a dollar per month benefit level. The plan is governed by a Fiduciary Benefits Committee (“the Committee”) which is appointed by the Company and contains only employees of Ardagh Group. The Committee is responsible for the investment of the plan’s assets, which are held in a trust for the benefit of employees, retirees and their beneficiaries, and which can only be used to pay plan benefits and expenses.
The defined benefit pension plan is subject to IRS funding requirements with actuaries calculating the minimum and maximum allowable contributions each year. The defined benefit pension plan currently has no cash contribution requirement due to the existence of a credit balance following a contribution of approximately $200 million made in 2014 in connection with the acquisition of Verallia North America. The Pension Benefit Guaranty Corporation (“PBGC”) protects the pension benefits of employees and retirees when a plan sponsor becomes insolvent and can no longer meet its obligation. All plan sponsors pay annual PBGC premiums that have two components: a fixed rate based on participant count and a variable rate which is determined based on the amount by which the plan is underfunded.
The Metal Beverage Packaging Americas plan covers hourly employees only. Plan benefits are determined using a formula which reflects the employees’ years of service and is based on a final average pay formula.
The Group operates a number of defined benefit pension schemes in Germany. The pension plans in Germany operate under the framework of German Company Pension Law (BetrAVG) and general regulations based on German labor law. The entitlements of the plan members depend on years of service and final salary. Furthermore, the plans provide lifelong pensions. No separate assets are held in trust, i.e. the plans are unfunded defined benefit plans. During the years ended December 31, 2019 and 2018, the Group elected to re-design two of its pension schemes in Germany, moving to contribution orientated schemes.
Ardagh Group S.A.
F-59
The U.K. pension plans are trust‑based U.K. funded final salary defined benefit schemes providing pensions and lump sum benefits to members and dependents. There is one pension plan in place relating to Metal Beverage Packaging Europe. It is closed to new entrants and was closed to future accrual effective December 31, 2018. For this plan, pensions are calculated based on service to retirement, with members’ benefits based on final career earnings. The U.K. pension plans are each governed by a board of trustees, which includes members who are independent of the Company. The trustees are responsible for managing the operation, funding and investment strategy. The U.K. pension plans are subject to the U.K. regulatory framework, the requirements of the Pensions Regulator and are subject to a statutory funding objective.
There are two pension plans in place in Glass Packaging Europe. The pension plans relating to Glass Packaging Europe have been closed to future accrual from March 31, 2013 and September 30, 2015 respectively.
Assumptions and sensitivities
The principal pension assumptions used in the preparation of the financial statements take account of the different economic circumstances in the countries of operations and the different characteristics of the respective plans, including the duration of the obligations. The ranges of the principal assumptions applied in estimating defined benefit obligations were:
Assumptions regarding future mortality experience are based on actuarial advice in accordance with published statistics and experience.
These assumptions translate into the following average life expectancy in years for a pensioner retiring at age 65. The mortality assumptions for the countries with the most significant defined benefit plans are set out below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. |
|
Germany |
|
UK |
||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
Years |
|
Years |
|
Years |
|
Years |
|
Years |
|
Years |
Life expectancy, current pensioners |
|
21 |
|
22 |
|
22 |
|
22 |
|
21 |
|
20 |
Life expectancy, future pensioners |
|
23 |
|
23 |
|
24 |
|
24 |
|
22 |
|
21 |
If the discount rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would increase by an estimated $186 million (2018: $193 million). If the discount rate were to increase by 50 basis points, the carrying amount of the pension obligations would decrease by an estimated $166 million (2018: $173 million).
If the inflation rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would decrease by an estimated $56 million (2018: $85 million). If the inflation rate were to increase by 50 basis points, the carrying amount of the pension obligations would increase by an estimated $63 million (2018: $94 million).
If the salary increase rate were to decrease by 50 basis points from management estimates, the carrying amount of the pension obligations would decrease by an estimated $61 million (2018: $90 million). If the salary increase rate were to increase by 50 basis points, the carrying amount of the pension obligations would increase by an estimated $69 million (2018: $99 million).
Ardagh Group S.A.
F-60
The impact of increasing the life expectancy by one year would result in an increase in the Group’s liability of $68 million at December 31, 2019 (2018: $66 million), holding all other assumptions constant.
The Group’s best estimate of contributions expected to be paid to defined benefit plans in 2020 is $30 million (2019: $21 million).
The principal defined benefit schemes are described briefly below:
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal Beverage Packaging |
|
Glass Packaging |
||||||||
|
|
Europe |
|
Europe |
|
North |
|
Europe |
|
Europe |
|
North |
|
|
UK |
|
Germany |
|
America |
|
UK |
|
Germany |
|
America |
Nature of the schemes |
|
Funded |
|
Unfunded |
|
Funded |
|
Funded |
|
Unfunded |
|
Funded |
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
Active members |
|
— |
|
893 |
|
822 |
|
— |
|
977 |
|
3,827 |
Deferred members |
|
808 |
|
198 |
|
44 |
|
1,240 |
|
689 |
|
2,638 |
Pensioners including dependents |
|
475 |
|
117 |
|
41 |
|
815 |
|
783 |
|
6,571 |
Weighted average duration (years) |
|
19 |
|
21 |
|
20 |
|
21 |
|
17 |
|
12 |
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
Active members |
|
467 |
|
939 |
|
825 |
|
— |
|
1,027 |
|
4,193 |
Deferred members |
|
478 |
|
161 |
|
23 |
|
1,240 |
|
747 |
|
2,589 |
Pensioners including dependents |
|
385 |
|
70 |
|
19 |
|
815 |
|
775 |
|
6,455 |
Weighted average duration (years) |
|
19 |
|
22 |
|
19 |
|
20 |
|
18 |
|
12 |
The expected total benefit payments over the next five years are:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent |
|
|
|
|
|
|
|
|
|
|
|
|
five years |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Benefits |
|
101 |
|
100 |
|
102 |
|
104 |
|
106 |
|
550 |
The Group also has defined contribution plans; the contribution expense associated with these plans for 2019 was $40 million (2018: $32 million; 2017: $30 million). The Group’s best estimate of the contributions expected to be paid to these plans in 2020 is $44 million (2019: $31 million).
Other employee benefits
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
End of service employee benefits |
|
2 |
|
25 |
Long term employee benefits |
|
99 |
|
102 |
|
|
101 |
|
127 |
End of service employee benefits principally comprise amounts due to be paid to employees leaving the Group’s service in Poland and Italy.
Long term employee benefit obligations comprise amounts due to be paid under post‑retirement medical schemes in Glass Packaging North America and Metal Beverage Packaging Americas, partial retirement contracts in Germany and other obligations to pay benefits primarily related to long service awards.
Ardagh Group S.A.
F-61
22. Provisions
|
|
|
|
|
|
|
|
|
|
|
Other |
|
Total |
|
|
Restructuring |
|
provisions |
|
provisions |
|
|
$'m |
|
$'m |
|
$'m |
At January 1, 2018 |
|
25 |
|
89 |
|
114 |
Provided |
|
39 |
|
103 |
|
142 |
Released |
|
(17) |
|
(24) |
|
(41) |
Paid |
|
(26) |
|
(67) |
|
(93) |
Exchange |
|
(1) |
|
— |
|
(1) |
At December 31, 2018 |
|
20 |
|
101 |
|
121 |
Provided |
|
16 |
|
90 |
|
106 |
Released |
|
(1) |
|
(18) |
|
(19) |
Paid |
|
(21) |
|
(89) |
|
(110) |
Disposal of Food & Specialty |
|
(9) |
|
(11) |
|
(20) |
Exchange |
|
— |
|
(1) |
|
(1) |
At December 31, 2019 |
|
5 |
|
72 |
|
77 |
The restructuring provision relates to redundancy and other restructuring costs. Other provisions relate to probable environmental claims, customer quality claims, onerous leases and specifically in Glass Packaging North America, workers’ compensation provisions.
The provisions classified as current are expected to be paid in the next twelve months. The majority of the restructuring provision is expected to be paid in 2020. The remaining balance represents longer term provisions for which the timing of the related payments is subject to uncertainty.
23. Trade and other payables
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
$'m |
|
$'m |
Trade payables |
|
1,166 |
|
1,517 |
Other payables and accruals |
|
279 |
|
339 |
Other tax and social security payable |
|
109 |
|
111 |
Payables and accruals for exceptional items |
|
65 |
|
16 |
Related party payables |
|
9 |
|
— |
|
|
1,628 |
|
1,983 |
The fair values of trade and other payables approximate the amounts shown above.
Other payables and accruals mainly comprise accruals for operating expenses, deferred income and value added tax payable.
Ardagh Group S.A.
F-62
24. Cash generated from operating activities
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Loss from continuing operations |
|
(284) |
|
(292) |
|
(126) |
Income tax charge/(credit) (Note 6) |
|
44 |
|
18 |
|
(77) |
Net finance expense (Note 5) |
|
659 |
|
479 |
|
638 |
Depreciation and amortization (Notes 9, 10) |
|
652 |
|
599 |
|
583 |
Exceptional operating items (Note 4) |
|
53 |
|
311 |
|
123 |
Share of post-tax loss in equity accounted joint venture (Note 12) |
|
49 |
|
— |
|
— |
Movement in working capital |
|
105 |
|
(9) |
|
116 |
Transaction-related, start-up and other exceptional costs paid |
|
(87) |
|
(92) |
|
(70) |
Exceptional restructuring paid |
|
(12) |
|
(23) |
|
(2) |
Cash generated from continuing operations |
|
1,179 |
|
991 |
|
1,185 |
25. Business combinations and disposals
On October 31, 2019, the Group completed the combination of Food & Specialty with the business of Exal to form Trivium. Consequently, Food & Specialty has been accounted for as a discontinued operation in the year ended December 31, 2019 and previous years have been represented accordingly below.
Results of discontinued operation
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||||
|
|
|
2019 |
|
|
2018 |
|
|
2017 |
|
|
|
$'m |
|
|
$'m |
|
|
$'m |
Revenue |
|
|
2,003 |
|
|
2,421 |
|
|
2,206 |
Expenses |
|
|
(1,769) |
|
|
(2,197) |
|
|
(1,980) |
Profit before tax |
|
|
234 |
|
|
224 |
|
|
226 |
Income tax charge |
|
|
(19) |
|
|
(26) |
|
|
(37) |
Profit from discontinued operation after tax |
|
|
215 |
|
|
198 |
|
|
189 |
Gain on disposal of discontinued operation, net of costs of disposal and tax |
|
|
1,527 |
|
|
– |
|
|
– |
Profit from discontinued operation |
|
|
1,742 |
|
|
198 |
|
|
189 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive income from discontinued operation |
|
|
1,741 |
|
|
163 |
|
|
303 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share from discontinued operation |
|
$ |
7.37 |
|
$ |
0.84 |
|
$ |
0.82 |
Ardagh Group S.A.
F-63
The Group has recognized a significant gain on the transaction on closing, which is detailed below.
The cash consideration, which is subject to customary completion adjustments, and the net assets disposed in the transaction were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
|
|
|
|
2019 |
|
|
|
|
|
|
$'m |
Cash consideration |
|
|
|
|
|
2,573 |
42% equity investment in Trivium |
|
|
|
|
|
412 |
|
|
|
|
|
|
2,985 |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
1,717 |
Current assets |
|
|
|
|
|
805 |
Total assets |
|
|
|
|
|
2,522 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
542 |
Current liabilities |
|
|
|
|
|
555 |
Total liabilities |
|
|
|
|
|
1,097 |
Net assets disposed |
|
|
|
|
|
(1,425) |
|
|
|
|
|
|
|
Cumulative foreign currency translation adjustments |
|
|
|
|
|
(27) |
Gain on disposal of discontinued operation |
|
|
|
|
|
1,533 |
The net cash flow relating to the disposal is summarized below:
|
|
|
|
|
|
|
$'m |
Cash consideration |
|
|
2,573 |
Cash and cash equivalents disposed |
|
|
(18) |
Net proceeds from disposal * |
|
|
2,555 |
* Please refer to the proceeds from disposal of discontinued operation, net of cash disposed of, as presented on the consolidated statement of cashflows.
Ardagh Group S.A.
F-64
26. Dividends
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Cash dividends on common shares declared and paid: |
|
|
|
|
|
|
Interim dividend: $0.14 per share (Prior year: $0.14 per share) |
|
(33) |
|
(33) |
|
(67) |
Interim dividend: $0.14 per share (Prior year: $0.14 per share) |
|
(33) |
|
(33) |
|
(33) |
Interim dividend: $0.14 per share (Prior year: $0.14 per share) |
|
(33) |
|
(33) |
|
(32) |
Interim dividend: $0.14 per share (Prior year: $0.14 per share) |
|
(33) |
|
(33) |
|
(33) |
|
|
(132) |
|
(132) |
|
(165) |
|
· |
|
On February 8, 2019, the Company declared a cash dividend of $0.14 per common share. The dividend of $33 million was paid on March 13, 2019 to shareholders of record on February 27, 2019. |
|
· |
|
On April 25, 2019, the Company declared a cash dividend of $0.14 per common share. The dividend of $33 million was paid on May 31, 2019 to shareholders of record on May 17, 2019. |
|
· |
|
On July 24, 2019 the Company declared a cash dividend of $0.14 per common share. The dividend of $33 million was paid on August 30, 2019 to shareholders of record on August 16, 2019. |
|
· |
|
On October 31, 2019 the Company declared a cash dividend of $0.14 per common share. The dividend of $33 million was paid on November 29, 2019 to shareholders of record on November 15, 2019. |
27. Related party information
|
(i) |
|
Interests of Paul Coulson |
As of February 19, 2020, the approval date of these financial statements, a company owned by Paul Coulson owns approximately 25% of the issued share capital of ARD Holdings S.A., the ultimate parent company. Through its non-controlling interest in the Yeoman group of companies, this company has an interest in a further approximate 34% of the issued share capital of ARD Holdings S.A..
|
(ii) |
|
Yeoman Capital S.A. |
At December 31, 2019, Yeoman Capital S.A. owned approximately 34% of the ordinary shares of ARD Holdings S.A..
|
(iii) |
|
Common directorships |
Four of the ARD Holdings S.A. directors (Paul Coulson, Brendan Dowling, Gerald Moloney and Hermanus Troskie) also serve as directors in the Yeoman group of companies. With the exception of Philip Hammond, Damien O’Brien and Edward White, all of the directors of Ardagh Group S.A. are members of the board of directors of ARD Holdings S.A..
|
(iv) |
|
Joint ventures |
The Group’s interests held in joint ventures are related parties and these are set out in further detail in notes 11 and 12. Balances outstanding with Trivium are set out in notes 15 and 23. Transactions with joint ventures were not material for any of the years presented.
Ardagh Group S.A.
F-65
|
(v) |
|
Key management compensation |
Key management are those persons who have the authority and responsibility for planning, directing and controlling the activities of the Group. Key management is comprised of the members who served on the Board and the Group’s executive leadership team during the reporting period. The amount outstanding at year end was $5 million (2018: $1 million, 2017: $7 million).
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
Salaries and other short-term employee benefits |
|
14 |
|
10 |
|
12 |
Post-employment benefits |
|
— |
|
1 |
|
1 |
|
|
14 |
|
11 |
|
13 |
Other compensation |
|
6 |
|
— |
|
7 |
|
|
20 |
|
11 |
|
20 |
|
(vi) |
|
Pension schemes |
The Group’s pension schemes are related parties. For details of all transactions during the year, please see Note 21.
|
(vii) |
|
Related party balances |
With the exception of the balances outlined in (i) to (vi) above, there are no material balances outstanding with related parties at December 31, 2019.
|
(viii) |
|
Toggle / PIK Notes |
In November 2019, ARD Finance S.A. issued the Toggle Notes to, among other things, refinance certain toggle notes issued by it in September 2016 (the "September 2016 Toggle Notes") and certain PIK notes issued by ARD Securities Finance SARL in January 2018 (“January 2018 PIK Notes”). Certain directors of the Company that held September 2016 Toggle Notes and January 2018 PIK Notes prior to the refinancing acquired and hold Toggle Notes issued in the refinancing.
Ardagh Group S.A.
F-66
|
(ix) |
|
Subsidiaries |
The following table provides information relating to our principal operating subsidiaries, all of which are wholly owned, at December 31, 2019.
|
|
|
|
|
|
|
Country of |
|
|
Company |
|
incorporation |
|
Activity |
Ardagh Metal Beverage Manufacturing Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Latas Indústria de Embalagens de Alumínio do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Indústria de Embalagens de Metálicas do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Glass Holmegaard A/S |
|
Denmark |
|
Glass Packaging |
Ardagh Metal Beverage Trading France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Metal Beverage France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Glass GmbH |
|
Germany |
|
Glass Packaging |
Heye International GmbH |
|
Germany |
|
Glass Engineering |
Ardagh Metal Beverage Trading Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Glass Sales Limited |
|
Ireland |
|
Glass Packaging |
Ardagh Packaging Holdings Limited |
|
Ireland |
|
Glass and Metal Beverage Packaging |
Ardagh Glass Italy S.r.l. |
|
Italy |
|
Glass Packaging |
Ardagh Glass Dongen B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Glass Moerdijk B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Metal Beverage Trading Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Glass S.A. |
|
Poland |
|
Glass Packaging |
Ardagh Metal Beverage Trading Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Glass Limmared AB |
|
Sweden |
|
Glass Packaging |
Ardagh Metal Beverage Europe GmbH |
|
Switzerland |
|
Metal Beverage Packaging |
Ardagh Glass Limited |
|
United Kingdom |
|
Glass Packaging |
Ardagh Metal Beverage Trading UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Metal Beverage UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Glass Inc. |
|
United States |
|
Glass Packaging |
Ardagh Metal Beverage USA Inc. |
|
United States |
|
Metal Beverage Packaging |
Ardagh Group S.A.
F-67
28. Contingencies
Environmental issues
The Group is regulated under various national and local environmental, occupational health and safety and other governmental laws and regulations relating to:
|
· |
|
the operation of installations for manufacturing of metal packaging and surface treatment using solvents; |
|
· |
|
the operation of installations for manufacturing of container glass; |
|
· |
|
the generation, storage, handling, use and transportation of hazardous materials; |
|
· |
|
the emission of substances and physical agents into the environment; |
|
· |
|
the discharge of waste water and disposal of waste; |
|
· |
|
the remediation of contamination; |
|
· |
|
the design, characteristics, collection and recycling of its packaging products; and |
|
· |
|
the manufacturing, sale and servicing of machinery and equipment for the container glass and metal packaging industry. |
The Group believes, based on current information that it is in substantial compliance with applicable environmental laws and regulations and permit requirements. It does not believe it will be required, under existing or anticipated future environmental laws and regulations, to expend amounts, over and above the amounts accrued, which will have a material effect on its business, financial condition or results of operations or cash flows. In addition, no material proceedings against the Group arising under environmental laws are pending.
In 2015, the German competition authority (the Federal Cartel Office) initiated an investigation of the practices in Germany of metal packaging manufacturers, including Ardagh’s Food & Specialty Metal Packaging business which was sold to Trivium. In 2018, the European Commission took over this investigation and the German investigation is, as a result, at an end. Ardagh has agreed to provide an indemnity in respect of certain losses that Trivium might incur in connection with this investigation. The European Commission’s investigation is ongoing, and there is, at this stage no certainty as to the extent of any charge which may arise. Accordingly, no provision has been recognized.
On April 21, 2017, a jury in the United States awarded $50 million in damages against the Group’s U.S. glass packaging business, formerly Verallia North America (“VNA”), in respect of one of two asserted patents alleged to have been infringed by VNA. On March 8, 2018, the trial judge confirmed the jury verdict. On July 12, 2019, the US Court of Appeals for the Federal Circuit affirmed the District Court’s decision of March 2018. The case was filed before Ardagh acquired VNA and customary indemnifications are in place between Ardagh and the seller of VNA. Arbitration proceedings are ongoing to enforce the indemnity. On October 8, 2019, Ardagh paid the court award and related interests to the plaintiffs. The results for the year ended December 31, 2019 include the receivable for the tax adjusted indemnity.
With the exception of the above legal matters, the Group is involved in certain other legal proceedings arising in the normal course of its business. The Group believes that none of these proceedings, either individually or in aggregate, are expected to have a material adverse effect on its business, financial condition, results of operations or cash flows.
29. Events after the reporting period
On February 19, 2020, the Company approved a cash dividend of $0.14 per common share. The dividend of $33 million will be payable on April 1, 2020 to shareholders of record on March 18, 2020.
Ardagh Group S.A.
F-68
30. Company financial information
This note has been included in these financial statements in accordance with the requirements of Regulation S‑X rule 12.04 Condensed financial information of registrant. The financial information provided below relates to the individual company financial statements for Ardagh Group S.A. as presented in accordance with IFRS as issued by the IASB.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with International Financial Reporting Standards have been condensed or omitted. The footnote disclosures contain supplemental information only and, as such, these statements should be read in conjunction with the notes to the accompanying consolidated financial statements.
The condensed financial information has been prepared using the same accounting policies as set out in the consolidated financial statements, except that investments in subsidiaries are included at cost less any provision for impairment in value.
The functional currency of the Company is euro and accordingly, the company financial information set out below is presented in euro.
|
i) |
|
Statement of financial position |
|
|
|
|
|
|
|
At December 31, |
||
|
|
2019 |
|
2018 |
|
|
€'m |
|
€'m |
Non-current assets |
|
|
|
|
Investments in subsidiary undertakings |
|
2,484 |
|
1,809 |
Investments in joint venture |
|
371 |
|
— |
|
|
2,855 |
|
1,809 |
Current assets |
|
|
|
|
Amounts receivable from subsidiary undertakings |
|
88 |
|
1 |
|
|
88 |
|
1 |
Total assets |
|
2,943 |
|
1,810 |
Equity attributable to owners of the parent |
|
|
|
|
Issued capital |
|
22 |
|
22 |
Share premium |
|
1,092 |
|
1,092 |
Legal reserve |
|
2 |
|
2 |
Capital contribution |
|
431 |
|
431 |
Retained earnings |
|
1,394 |
|
261 |
Total equity |
|
2,941 |
|
1,808 |
Current liabilities |
|
|
|
|
Other payables |
|
2 |
|
2 |
|
|
2 |
|
2 |
Total liabilities |
|
2 |
|
2 |
Total equity and liabilities |
|
2,943 |
|
1,810 |
Ardagh Group S.A.
F-69
|
ii) |
|
Statement of comprehensive income |
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
` |
|
€'m |
|
€'m |
|
€'m |
|
|
|
|
|
|
|
Dividend income |
|
89 |
|
110 |
|
150 |
Other external charges |
|
(3) |
|
(1) |
|
(1) |
Finance expense |
|
(1) |
|
(1) |
|
(1) |
Profit before tax and gain on disposal of investment |
|
85 |
|
108 |
|
148 |
Income tax |
|
— |
|
— |
|
— |
Gain on disposal of investment * |
|
1,164 |
|
— |
|
— |
Profit and total comprehensive income for the year |
|
1,249 |
|
108 |
|
148 |
*The gain recognized in the Company for the year ended December 31, 2019, relates to the divestment of the Food & Specialty Metal Packaging business completed on October 31, 2019 and the recognition of shares issued to the Company by Trivium Packaging B.V. as part consideration for the disposal.
|
iii) |
|
Statement of cash flows |
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
€'m |
|
€'m |
|
€'m |
Cash flows from operating activities |
|
|
|
|
|
|
Cash generated from operations |
|
(3) |
|
(1) |
|
(1) |
Tax paid |
|
— |
|
(1) |
|
— |
Increase in receivables |
|
— |
|
— |
|
(10) |
Increase/(decrease) in payables |
|
1 |
|
(6) |
|
— |
Net cash from operating activities |
|
(2) |
|
(8) |
|
(11) |
Cash flows from investing activities |
|
|
|
|
|
|
Proceeds from disposal of investment |
|
2,307 |
|
— |
|
— |
(Repayment)/receipt of loans from subsidiary undertakings |
|
(1,601) |
|
9 |
|
— |
Contribution to subsidiary undertaking (i) |
|
(675) |
|
— |
|
(299) |
Dividends received |
|
89 |
|
110 |
|
150 |
Net cash received from/(used in) investing activities |
|
120 |
|
119 |
|
(149) |
Cash flows from financing activities |
|
|
|
|
|
|
Proceeds from share issuance |
|
— |
|
— |
|
309 |
Dividends paid |
|
(118) |
|
(112) |
|
(148) |
Net cash (outflow)/inflow from financing activities |
|
(118) |
|
(112) |
|
161 |
Net (decrease)/increase in cash and cash equivalents |
|
— |
|
(1) |
|
1 |
Cash and cash equivalents at the beginning of the year |
|
— |
|
1 |
|
— |
Cash and cash equivalents at the end of the year |
|
— |
|
— |
|
1 |
(i) In November 2019 AGSA made a capital contribution of €675 million into Ardagh Packaging Group Limited a wholly owned
subsidiary. Ardagh Packaging Group Limited is an Irish registered company that acts as an intermediate holding company for the
Ardagh Group.
|
iv) |
|
Maturity analysis of the Company’s borrowings |
At December 31, 2019, the Company had €nil borrowings (2018: €nil).
Ardagh Group S.A.
F-70
|
v) |
|
Distributions paid and received |
During the year ended December 31, 2019 the Company received a dividend of €89 million (2018: €110 million, 2017: €150 million) from a subsidiary company. The Company also paid a dividend to its equity holders of €118 million (2018: €112 million, 2016: €148 million).
|
vi) |
|
Commitments and contingencies |
The Company has guaranteed certain liabilities of a number of its subsidiaries for the year ended December 31, 2019 including guarantees under Section 357 of the Irish Companies Act, 2014 and Section 264 of the German Commercial Code. Furthermore, the Company has assumed joined and several liability in accordance with Section 403, Book 2 of the Dutch Civil Code for the liabilities of a number of its Dutch subsidiaries.
With exception of the above guarantees the Company had no commitments and contingencies at December 31, 2019 (2018: €nil).
|
vii) |
|
Additional information |
The following reconciliations are provided as additional information to satisfy the Schedule I SEC Requirements for parent‑only financial information, and are presented in both euro and U.S. dollars.
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
€'m |
|
€'m |
|
€'m |
IFRS profit/(loss) reconciliation: |
|
|
|
|
|
|
Parent only—IFRS profit for the year |
|
1,249 |
|
108 |
|
148 |
Additional gain/(loss) if subsidiaries had been accounted for using the equity method of accounting as opposed to cost |
|
78 |
|
(191) |
|
(94) |
Consolidated IFRS profit/(loss) for the year |
|
1,327 |
|
(83) |
|
54 |
|
|
|
|
|
|
|
|
|
At December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
€'m |
|
€'m |
|
€'m |
IFRS equity reconciliation: |
|
|
|
|
|
|
Parent only—IFRS equity |
|
2,941 |
|
1,808 |
|
1,812 |
Additional loss if subsidiaries had been accounted for using the equity method of accounting as opposed to cost |
|
(3,128) |
|
(3,127) |
|
(2,961) |
Consolidated—IFRS equity |
|
(187) |
|
(1,319) |
|
(1,149) |
|
|
|
|
|
|
|
|
|
Year ended December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
IFRS profit/(loss) reconciliation: |
|
|
|
|
|
|
Parent only—IFRS profit for the year |
|
1,400 |
|
128 |
|
166 |
Additional gain/(loss) if subsidiaries had been accounted for using the equity method of accounting as opposed to cost |
|
58 |
|
(222) |
|
(103) |
Consolidated IFRS profit/(loss) for the year |
|
1,458 |
|
(94) |
|
63 |
|
|
|
|
|
|
|
|
|
At December 31, |
||||
|
|
2019 |
|
2018 |
|
2017 |
|
|
$'m |
|
$'m |
|
$'m |
IFRS equity reconciliation: |
|
|
|
|
|
|
Parent only—IFRS equity |
|
3,304 |
|
2,064 |
|
2,173 |
Additional loss if subsidiaries had been accounted for using the equity method of accounting as opposed to cost |
|
(3,520) |
|
(3,574) |
|
(3,548) |
Consolidated—IFRS equity |
|
(216) |
|
(1,510) |
|
(1,375) |
Ardagh Group S.A.
F-71
Exhibit 1.1
Ardagh Group S.A.
Société anonyme
Siège social : L-2134 Luxembourg, 56, Rue Charles Martel
R.C.S. Luxembourg section B numéro 160804
**************************************************
STATUTS COORDONNÉS AU
18 DECEMBRE 2019
**************************************************
TABLE OF CONTENTS
INTERPRETATION
1. Definitions
FORM, NAME, DURATION AND REGISTERED OFFICE
2. Form and Name
3. Duration
4. Registered Office
CORPORATE OBJECTS
5. Corporate Objects
SHARES
6. Share Capital and Rights Attaching to Shares
7. Power to Issue Shares
8. Variation of Rights Attaching to Shares
9. Power of the Company to Purchase or otherwise Acquire its own Shares
10. Suspension and/or Waiver of Voting Right; Voting by Incapacitated Holders
11. Statements of Share Ownership
REGISTRATION OF SHARES
12. Register of Shareholders
13. Transfer of Shares
14. Conversion of Class B Common Shares
15. Compulsory Transfer of Shares
ALTERATION OF SHARE CAPITAL
16. Power to Alter Capital
DIVIDENDS AND LEGAL RESERVE
17. Dividends
18. Legal Reserve
MEETINGS OF SHAREHOLDERS
19. General Meetings
20. Record Date For Shareholder Notice; Voting.
21. Convening of General Meetings
22. Participation by telephone or video conference
23. Quorum at General Meetings
24. Voting on Ordinary and Special Resolutions
25. Instrument of Proxy
26. Adjournment of General Meeting
DIRECTORS AND OFFICERS
27. Number of Directors
28. Election of Directors
29. Classes of Directors
30. Term of Office of Directors
31. Removal of Directors
32. Vacancy in the Office of Director
33. Remuneration of Directors
34. Directors to Manage Business
35. Powers of the Board of Directors
36. Appointment of Chairman and Secretary
37. Appointment, Duties and Remuneration of Officers
38. Indemnification of Directors and Officers
39. Binding Signatures
MEETINGS OF THE BOARD OF DIRECTORS
40. Board Meetings
41. Notice of Board Meetings
42. Participation by telephone or video conference
43. Quorum at Board Meetings
44. Board to Continue in the Event of Vacancy
45. Written Resolutions
46. Validity of Acts of Directors
CORPORATE RECORDS
47. Minutes of the Meetings of the Shareholders
48. Minutes of the Meetings of the Board
49. Place Where Corporate Records Kept
50. Service of Notices
FINANCIAL YEAR
51. Financial Year
AUDITOR
52. Appointment of Auditor
VOLUNTARY WINDING-UP AND DISSOLUTION
53. Winding-Up
CHANGES TO CONSTITUTION
54. Changes to Articles
55. Governing Law
INTERPRETATION
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1. Definitions |
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1.1 In these Articles, the following words and expressions shall, where not inconsistent with the context, have the following meanings, respectively: |
Acquiror has the meaning ascribed in Article 15.1;
Acquiror Expert has the meaning ascribed in Article 15.1;
Acquiror Purchase Price has the meaning ascribed in Article 15.2;
Act the Luxembourg law of 10 August 1915 pertaining to commercial companies, as amended from time to time;
Affected Class B common share has the meaning ascribed in Article 14.4;
Affiliate with respect to a person, means any person directly or indirectly controlling, controlled by or under common control with such person;
Articlesmeans these articles, as amended from time to time in accordance with Article 54;
Article 15 Notice has the meaning ascribed in Article 15.1;
Auditor means one or more independent auditors (réviseurs d’enterprises) appointed in accordance with these Articles and includes an individual, company or partnership;
Board the board of directors appointed or elected from time to time pursuant to these Articles;
Chairman the chairman of the Board;
Class A common shares has the meaning ascribed in Article 6.1;
Class B common shares has the meaning ascribed in Article 6.1;
clear days in relation to the period of a notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect;
Common Shares has the meaning ascribed in Article 6.1;
Company the company for which these Articles are approved and confirmed;
Compulsory Acquisition Notice has the meaning ascribed in Article 15.2;
Control with respect to any person, means the possession, directly or indirectly, by another person of the power to direct or cause the direction of the management and policies of such first person, whether through the ownership of voting securities, by contract or otherwise;
Conversion has the meaning ascribed in Article 14.2;
Conversion Trigger has the meaning ascribed in Article 14.3;
Depository has the meaning ascribed in Article 12.4;
Director a director of the Company;
EUR the single currency of participating member states of the European Union and the lawful currency for the time being of Luxembourg;
Fair Market Value has the meaning ascribed in Article 9.6;
Family Member with respect to any natural person who is a Pre-IPO Equity Interest Holder, such person’s spouse, domestic partner, parents, stepparents, grandparents, lineal descendants, siblings and lineal descendants of siblings. Lineal descendants include adopted persons and stepchildren;
Indemnified party has the meaning ascribed in Article 38.1;
Luxembourg has the meaning ascribed in Article 4.1;
notice written notice as further provided in these Articles unless otherwise specifically stated;
Notice of Objection has the meaning ascribed in Article 15.3;
notice to the Company written notice addressed to the Secretary or another officer identified by the Company to Shareholders from time to time, delivered to the registered office of the Company by hand or mail, or to the Company by facsimile or electronic mail (with customary proof of confirmation that such notice has been transmitted);
Officer any person appointed as an officer of the Company by the Board, with such title, powers and duties as designated by resolution of the Board in accordance with Article 37;
Ordinary Resolution a resolution adopted at an ordinary general meeting (including the annual general meeting) with the quorum set forth in Article 23.1 and the majority set forth in Article 24.1;
Parent ARD Holdings S.A. and any successors thereto;
Permitted Entity (a) a Permitted Trust solely for the benefit of (i) a Pre-IPO Equity Interest Holder, (ii) one or more Family Members of such Pre-IPO Equity Interest Holder and/or (iii) any other Permitted Entity of such Pre-IPO Equity Interest Holder;
(b) any general partnership, limited partnership, limited liability company, corporation or other entity exclusively owned by (i) a Pre-IPO Equity Interest Holder, (ii) one or more Family Members of such Pre-IPO Equity Interest Holder and/or (iii) any other Permitted Entity of such Pre-IPO Equity Interest Holder;
(c) the personal representative of the estate of a Pre-IPO Equity Interest Holder upon the death of such Pre-IPO Equity Interest Holder solely to the extent such individual or entity is acting in the capacity as personal representative of such estate;
(d) a revocable living trust, which revocable living trust is itself a Permitted Trust, following the death of the natural person grantor of such trust, solely to the extent that such shares are held in such trust pending distribution to the beneficiaries designated in such trust, all of whom are Qualified Holders; and
(e) a guardian or conservator of a Qualified Holder who has been adjudged disabled, incapacitated, incompetent or otherwise unable to manage his own affairs by a court of competent jurisdiction, solely in that guardian's or conservator's capacity as such.
Except as explicitly provided for in these Articles, a Permitted Entity of a Pre-IPO Equity Interest Holder shall not cease to be a Permitted Entity of that Pre-IPO Equity Interest Holder solely by reason of his death;
Permitted Transfer any transfer of a Class B common share to a Qualified Holder;
Permitted Trust a trust where each trustee is (a) a Pre-IPO Equity Interest Holder, (b) a Family Member of a Pre-IPO Equity Interest Holder, or (c) a professional (including an attorney or accountant) in the business of providing trustee services, including private professional fiduciaries, trust companies and bank trust departments.
person any individual, corporation, partnership, joint venture, limited liability company, trust or other incorporated or unincorporated organisation or any other entity, including a governmental entity or authority;
Pre-IPO Equity Interest a beneficial direct or indirect equity interest in (i) Parent, including as a holder of a beneficial equity interest in any corporation, partnership, limited liability company or similar business entity that holds the beneficial interest in shares in Parent, or (ii) any Subsidiary of Parent, including as a holder of a beneficial equity interest in any corporation, partnership, limited liability company or similar business entity that holds the beneficial interest in shares in such Subsidiary;
Pre-IPO Equity Interest Holder a person who, as of the date of the closing of the initial public offering of Class A common shares, is a beneficial owner (and thus ignoring and excluding any holder who is a nominee for the benefit of a beneficial owner, no such nominee being a Pre-IPO Equity Interest Holder for these purposes) of a Pre-IPO Equity Interest, including any natural person who has transferred his Pre-IPO Equity Interest to a Permitted Entity as of such date;
Purchase Price has the meaning ascribed in Article 15.3;
Qualified Holder (i) Parent or any Subsidiary of Parent (or any successor to Parent or any of its Subsidiaries), or (ii) any Pre-IPO Equity Interest Holder or any Family Member or Permitted Entity of such Pre-IPO Equity Interest Holder;
Register of Shareholders the register of shareholders referred to in these Articles;
Relevant Shareholder has the meaning ascribed in Article 14.5;
Remaining Holder Expert has the meaning ascribed in Article 15.3;
Reorganisation Event an event in which the shareholders of Parent and/or other Subsidiaries of Parent (or any successors thereto) will receive direct ownership in a number of Class B common shares or Class A common shares (in proportion to their respective ownership interest in Parent and/or other Subsidiaries of Parent), whether by dividend, distribution, exchange offer or other means; provided that the aggregate number of Class B common shares received by such shareholders in such event shall be substantially the same as or fewer than (adjusting for fractional shares) the number of the Class B common shares owned by Parent and any Subsidiaries of Parent (or any successors thereto) immediately prior to the date of such event;
Remaining Holders has the meaning ascribed in Article 15.1;
Remaining Shares has the meaning ascribed in Article 15.1;
Secretary the person appointed as secretary of the Company by the Board, including any deputy or assistant secretary and any person appointed by the Board to perform any of the duties set forth in Article 36.2 and specifically entrusted by resolution to the Secretary;
Share Capital in Issue the sum of the aggregate par value of the issued Common Shares, taking into account that the par value of each Class A common share is EUR 0.01 and the par value of each Class B common share is EUR 0.10;
Shareholder any person registered in the Register of Shareholders as the holder of shares in the Company;
Special Resolution a resolution adopted at an extraordinary general meeting with the quorum set forth in Article 23.2 and the majority set forth in Article 24.2;
Subsidiary an incorporated or unincorporated entity in which another person (i) has a majority of the shareholders' or members' voting rights or (ii) has the right to appoint or remove a majority of the members of the administrative, management or supervisory body and is at the same time a shareholder in or member of such entity;
Transfer has the meaning ascribed in Article 13.6; and
Treasury Share a share of the Company that was or is treated as having been acquired and held by the Company and has been held (or is treated as having been held) continuously by the Company since it was so acquired and has not been cancelled.
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1.2 In these Articles, where not inconsistent with the context: |
(a)words denoting the plural number include the singular number and vice versa;
(b)words denoting the masculine gender include the feminine and neuter genders;
(c)the word:
(i)"may" shall be construed as permissive;
(ii) "shall" shall be construed as imperative; and
(iii) "including" shall be deemed to be followed by the words "without limitation";
(d)a reference to statutory provision shall be deemed to include any amendment or re-enactment thereof;
(e)the word "corporation" means a legal entity (personne morale);
(f)unless otherwise provided herein, words or expressions used in these Articles and defined in the Act shall bear the same meaning in these Articles as in the Act.
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1.3 In these Articles expressions referring to writings shall, unless the contrary intention appears, include facsimile, printing, lithography, photography, electronic mail and other modes of representing words in visible form. |
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1.4 Headings used in these Articles are for convenience only and are not to be used or relied upon in the construction hereof. |
FORM, NAME, DURATION AND REGISTERED OFFICE
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2. Form and Name |
The Company’s legal name is "Ardagh Group S.A." and it is a public limited liability company (société anonyme).
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3. Duration |
The Company is incorporated for an unlimited duration.
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4. Registered Office |
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4.1 The registered office of the Company is established in the City of Luxembourg, Grand Duchy of Luxembourg ("Luxembourg"). It may be transferred within Luxembourg by a resolution of the Board, which may amend the Articles accordingly. |
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4.2 If the Board determines that extraordinary political or military developments or events have occurred or are imminent and that these developments or events would interfere with the normal activities of the Company at its registered office, or with the ease of communication between such office and persons abroad, the registered office may be temporarily transferred abroad until the complete cessation of these extraordinary circumstances. Such |
temporary measures shall have no effect on the nationality of the Company which, notwithstanding the temporary transfer of its registered office, will remain a Luxembourg incorporated company. Such temporary measures will be taken by the Board and notified to the Shareholders of the Company. |
CORPORATE OBJECTS
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5. Corporate Objects |
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5.1 The corporate objects of the Company are to hold, directly or indirectly, equity or other interests in other persons, including its Subsidiaries, and take all actions as are necessary or useful to realise these objects. |
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5.2 The Company has the power to carry out the following actions: |
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(a) the acquisition, holding, management and disposal, in any form, by any means, directly or indirectly, of participations, rights and interests in, and obligations of, Luxembourg and non-Luxembourg companies, partnerships or other incorporated or non-incorporated entities; |
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(b) the acquisition by purchase, subscription, assumption or in any other manner and the transfer by sale, exchange or in any other manner of equity securities, bonds, debentures, notes and other securities or financial instruments of any kind and contracts thereon or related thereto; |
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(c) the ownership, administration, development and management of a portfolio of assets, including real estate assets and the assets referred to in paragraphs (a) and (b) above; |
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(d) the holding, acquisition, disposal, development, licensing or sublicensing, and management of, or the investment in, any patents or other intellectual property rights of any nature or origin as well as the rights deriving therefrom; |
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(e) the issuance of debt and equity securities in any currency and in any form including by way of: |
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(i) the issue of shares, notes, bonds, debentures or any other form of debt or equity security and in any manner, whether by way of private placement, public offering or otherwise; and |
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(ii) borrowing from any third party, including banks, financial institutions, or other person whether or not affiliated with the Company; |
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(f) to the extent permitted under Luxembourg law, the provision of any form of equity or debt funding or any other form of financial assistance in any currency and whether or not financed by any of the methods mentioned in (e) above and whether subordinated or unsubordinated, to any person including to the Company’s subsidiaries, Affiliates and/or any other persons that may or may not be Shareholders or Affiliates of the Company; |
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(g) the giving of guarantees or the creation of any form of encumbrance or security over all or any of its assets to guarantee or secure its own obligations or those obligations and undertakings of any other companies or persons that may or may not be Shareholders or Affiliates, and, generally, for its own benefit and/or the benefit of any other persons that may or may not be Shareholders or Affiliates of the Company; and |
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(h) taking any actions designed or intended to protect the Company against credit, currency exchange, interest rate or other risks. |
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5.3 The objects and powers described in this Article 5 are to be interpreted in their broadest sense and any transaction or agreement which is entered into by the Company that is not inconsistent with the foregoing objects or powers will be deemed to be within the scope of such objects or powers. |
SHARES
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6. Share Capital and Rights Attaching to Shares |
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6.1 The authorised share capital of the Company is EUR 55,000,000, divided into (i) 1,000,000,000 Class A common shares, with a par value of EUR 0.01 each (the "Class A common shares”), and (ii) 450,000,000 of Class B common shares, with a par value of EUR 0.10 per share (the “Class B common shares,” and, together with the Class A common shares, the “Common Shares”). The Company shall at all times reserve and keep available out of its authorised but unissued share capital such number of Class A common shares as shall from time to time be sufficient to affect the conversion of all Class B common shares outstanding from time to time in accordance with Article 14. |
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6.2 6.2 the Share Capital in issue of the company amounts to twenty-one million nine hundred fifty-six thousand two hundred and seven Euro and sixty eight Cents (EUR 21,956,207.68) divided into eighteen million six hundred sixty thousand seven hundred and sixty eight (18,660,768) Class A common shares, with a par value of one Euro Cents (EUR 0.01) each, and two hundred seventeen million six hundred ninety-six thousand (217,696,000) Class B common shares with a par value of ten Euro Cents (EUR 0.10) each. The Company may issue additional shares, including Class A common shares, in accordance with these Articles. |
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6.3 The holders of Class A common shares shall, subject to these Articles: |
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(a) be entitled to one vote per Class A common share (being one vote per EUR 0.01 of the share capital); |
|
(b) not be entitled to convert the Class A common shares into any other class of shares; |
|
(c) be entitled, with holders of Class B common shares in accordance with Article 17.2, to such dividends or other distributions as the Company may from time to time declare; |
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(d) in the event of a winding-up or dissolution of the Company, whether voluntary or involuntary or for the purpose of a reorganisation or otherwise, be entitled, with holders of Class B common shares in accordance with Article 53.2, to the surplus assets of the Company; and |
|
(e) generally be entitled to enjoy all of the rights attaching to shares. |
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6.4 The holders of Class B common shares shall, subject to these Articles: |
|
(a) be entitled to ten votes per Class B common share (being one vote per EUR 0.01 of the share capital as each Class B common share has a par value of EUR 0.10); |
|
(b) (i) be entitled, at the option of the holder exercised in accordance with Article 14, to convert each Class B common share into one Class A common share at any time, and (ii) be subject to mandatory conversion, as provided in Article 14; |
|
(c) be entitled, with holders of Class A common shares in accordance with Article 17.2, to such dividends or other distributions as the Company may from time to time declare; |
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(d) in the event of a winding-up or dissolution of the Company, whether voluntary or involuntary or for the purpose of a reorganisation or otherwise be entitled, with holders of Class A common shares in accordance with Article 53.2, to the surplus assets of the Company; and |
|
(e) generally be entitled to enjoy all of the rights attaching to shares. |
|
6.5 The holders of Class A common shares and Class B common shares will vote together on all matters, unless otherwise required by the Act or these Articles. |
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7. Power to Issue Shares |
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7.1 Without prejudice to any special rights conferred on the Shareholders of any existing shares or class of shares (which special rights shall not be affected, modified or abrogated except with such consent or sanction as is provided in these Articles), and subject to the provisions of the Act, any share may be issued either at par or at a premium and with such rights and/or restrictions, whether in respect of dividends, voting, return of capital, transferability or otherwise, as the Company may from time to time direct. |
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7.2 Any share premium created upon the issue of shares pursuant to Article 7.1 shall be available for repayment to the Shareholders, the payment of which shall be within the absolute discretion of the Board. Without limiting the foregoing, the Board is authorised to use any share premium for the purpose of making any share premium repayment to Shareholders or repurchasing shares of the Company. |
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7.3 (a)The Board is generally and unconditionally authorised for a period of five years from 3 March 2017, to issue Common Shares, to grant options to subscribe for Common Shares and to issue any other instruments convertible into Common Shares up to a maximum of the authorised but as yet unissued share capital of the Company to such persons and on such terms as the Board determines in its absolute discretion. The Board may set the subscription price for the Common Shares so issued, as well as determining the form of consideration to be paid for any such Common Shares which may include (i) cash, including the setting off of claims against the Company that are certain, due and payable, (ii) payment in kind, and (iii) reallocation of the share premium, profit reserves or other reserves of the Company. The Board is also authorised to issue Common Shares free of charge within the limitations of Article 32-3 (5bis) of the Act. |
(b)Notwithstanding the foregoing, the Board may not pursuant to Article 7.3(a) issue Class B common shares in excess of the 1,111,120 Class B common shares issued on 3 March 2017 except:
(i) in connection with stock splits or share dividends (also known as bonus issues) being made to all holders of outstanding Common Shares in accordance with Article 17.2; or
(ii) in connection with a Reorganisation Event, provided that the number of Class B common shares issued in such Reorganisation Event is substantially the same as or less than the number of Class B common shares received by the Company in such Reorganisation Event as treasury shares which are to be cancelled by the Company in due course; or
(iii) in connection with the conversion, prior to initial public offering of the Company’s Class A common shares, of the Convertible Loan Note that the Company issued to ARD Group Finance Holdings S.A., on 16 September 2016.
The Board is authorised to withdraw or limit the Luxembourg statutory preemption provisions upon the issuance of Common Shares pursuant to the authority conferred by Article 7.3.
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7.4 The Board shall be authorised to appoint, in its absolute discretion, a representative, to appear before a public notary in Luxembourg for the purpose of amending the Articles to reflect the changes resulting from the increases to the issued share capital of the Company in accordance with Article 7.3. |
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8. Variation of Rights Attaching to Shares |
Where a resolution of an extraordinary general meeting is such as to change the respective rights of the Class A common shares or the Class B common shares, the Special Resolution must, in order to be valid, fulfil the quorum and majority requirements with respect to each such class of shares.
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9. Power of the Company to Purchase or otherwise Acquire its own Shares |
|
9.1 The Company may purchase, acquire or receive its own shares for cancellation or to hold them as Treasury Shares within the limits, and subject to the conditions, set forth in the Act and other applicable laws and regulations. |
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9.2 Pursuant to and in conformity with the provisions of Article 49-2 of the Act, and in conformity with all other applicable laws and regulations, (including any rules and regulations of any stock market, exchange or securities settlement system on which the shares are traded, as may be applicable to the Company), the Company is authorised to purchase, acquire, receive and/or hold shares, including the Common Shares, from time to time, provided that: |
|
(a) the shares hereby authorised to be purchased shall all be fully paid-up issued shares in the Company; |
|
(b) the maximum number of shares purchased, acquired or received by the Company shall be such that the aggregate nominal value or the aggregate accounting par value of the shares held by persons other than the Company does not fall below the minimum issued share capital prescribed by the Act; |
|
(c) the maximum price which may be paid for each share shall not exceed the Fair Market Value (as defined in Article 9.6); |
|
(d) the minimum price which may be paid for each share shall be the par value of the share; |
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(e) the acquisitions, including the shares previously acquired by the Company and held by it, and shares acquired by a person acting in his own name but on the Company’s behalf, may not have the effect of reducing the net assets of the Company below the amount mentioned in paragraphs (1) and (2) of Article 72-1 of the Act. |
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9.3 This authority, (unless previously revoked, varied or renewed by the general meeting) is granted for a period of five years from 3 March 2017. |
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9.4 This authority relates only to: |
|
(a) one or more market purchases (being a purchase of Class A common shares by the Company of shares offered for sale by any Shareholder on any stock exchange on which the Class A common shares are traded), as the Board shall determine without such acquisition offer having to be made to all Shareholders; and |
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(b) purchases effected in circumstances other than those referred to in Article 9.4(a), where an offer on the same terms has been made by the Company to all Shareholders in a similar situation. |
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9.5 The Board shall be authorised to appoint, in its absolute discretion, a representative, to appear before a public notary in Luxembourg for the purpose of amending the Articles to reflect the changes resulting from the cancellation of any shares repurchased in accordance with the terms of this Article 9, if such election is made to cancel the shares. |
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9.6 For the purposes of this Article 9, "Fair Market Value" means, in respect of any share: |
|
(a) the actual price at which the Company effects a purchase of its own shares pursuant to an announced open market repurchase program on the New York Stock Exchange or, if the Company's shares are not listed on the New York Stock Exchange, on such other securities exchange on which the Company's shares are then listed or traded; or |
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(b) in the case of any repurchase of shares that is not affected pursuant to an announced open market repurchase program on the New York Stock Exchange or another securities exchange, the fair market value determined in good faith by an independent auditor (réviseur d'entreprises) appointed by the Board on the basis of such information and facts as available to, and deemed relevant by, the independent auditor. |
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9.7 Voting rights attaching to a Treasury Share shall be suspended and shall not be exercised by the Company while it holds such Treasury Shares and, except where required by the Act, all Treasury Shares shall be excluded from the calculation of any percentage or fraction of the share capital, or shares, of the Company for determining the quorum and majority requirements of any general meeting. The aforementioned restrictions on voting rights shall apply to shares issued by the Company and held by direct and indirect subsidiaries, in accordance with Article 49bis of the Act. |
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10. Suspension and/or Waiver of Voting Right; Voting by Incapacitated Holders |
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10.1 The Board may suspend the right to vote of any Shareholder if such Shareholder does not fulfil his obligations under the Articles (as in effect on 3 March 2017) or any deed of subscription or deed of commitment entered into by such Shareholder. |
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10.2 Any Shareholder may individually decide not to exercise, temporarily or definitively, such Shareholder’s right to vote all or any of such Shareholder’s shares. Any such Shareholder shall be bound by such waiver, which shall be enforceable by the Company from the date of the Company’s receipt of notice from such Shareholder of such waiver. |
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10.3 If the voting rights of one or more Shareholders are suspended in accordance with this Article 10 or a Shareholder has temporarily or permanently waived such Shareholder’s voting right in accordance with this Article 10, such Shareholders shall receive notice of and may attend any general meeting of Shareholders but the shares with respect to which such Shareholder does not have, or has waived, voting rights in accordance with this Article 10 shall not be taken into account for determining whether the quorum and majority vote requirements are satisfied. |
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10.4 A Shareholder of unsound mind, or in respect of whom an order has been made by any court having jurisdiction (whether in Luxembourg or elsewhere) in matters concerning mental disorder, may vote, by such Shareholder’s committee, receiver, guardian or other person appointed by that court and any such committee, receiver, guardian or other person may vote by proxy. Evidence to the satisfaction of the Board of the authority of the person claiming to exercise the right to vote shall be deposited at the registered office of the Company or at such other place as is specified in accordance with these Articles for the deposit of proxies, not less than forty-eight (48) hours before the time appointed for holding the meeting or adjourned meeting at which the right to vote is exercised, failing which the right to vote shall not be exercised. |
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11. Statements of Share Ownership |
At the request of a Shareholder, the Company shall issue a statement of share ownership evidencing the number of Common Shares registered in such Shareholder’s name in the Register of Shareholders on the date of such statement.
REGISTRATION OF SHARES
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12. Register of Shareholders |
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12.1 The shares are and will remain in registered form (actions nominatives) and the Shareholders are not permitted to request the conversion of their shares into bearer form. |
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12.2 The Board shall cause to be kept a Register of Shareholders and shall enter therein the particulars required by the Act. |
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12.3 The Company shall be entitled to treat the registered holder of any share as the absolute owner thereof and accordingly shall not be bound to recognise any equitable claim or other claim to, or interest in, such share on the part of any other person. |
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12.4 Where shares are recorded in the Register of Shareholders on behalf of one or more persons in the name of a securities settlement system or the operator of such system, or in the name of a professional depository of securities, or any other depository (such system, professional or other depository, being referred to as "Depository") or of a sub-depository designated by one or more Depositories, the Company, subject to it having received from the Depository with which those shares are kept in account satisfactory evidence of the underlying ownership of Common Shares by those persons and their authority to vote the shares, will permit those persons to exercise the rights attaching to those shares, including admission to and voting at general meetings. A notice may be given by the Company to the holders of shares held through a Depository by giving such notice to the Depository whose name is listed in the Register of Shareholders in respect of the shares, and any such notice shall be regarded as proper notice to all underlying holders of shares. Notwithstanding the foregoing, the Company shall make payments, by way of dividends or otherwise, in cash, shares or other assets as permitted pursuant to these Articles, only to the Depository or sub-depository recorded in the Register of Shareholders or in accordance with its instructions, and such payment by the Company shall release the Company from any and all obligations in respect of such payment. |
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12.5 In the case of joint holders of shares, the Company shall treat the first named holder on the Register of Shareholders as having been appointed by the joint holders to receive all notices and to give a binding receipt for any dividend(s) payable in respect of such share(s) on behalf of all joint holders, without prejudice to the rights of the other holders to information as set out in the Act. |
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13. Transfer of Shares |
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13.1 Any Shareholder may, subject to the provisions of the Act and the restrictions contained in these Articles, transfer all or any of such Shareholder’s shares by written instrument of transfer; provided that shares listed or admitted to trading on a stock exchange may be transferred in accordance with the rules and regulations of such exchange. |
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13.2 Any Transfer (as defined below) of a Class B common share that is not first determined by the Board to be a Permitted Transfer shall be a breach of these Articles with the effect that (i) such Class B common share shall immediately be deemed to be an Affected Class B common share with respect to which a Conversion Trigger described |
in Article 14.3(a)(ii) occurred at the time of the Transfer and (ii) the Board may suspend the voting rights of such Class B common share until such Class B common share is converted in accordance with Article 14.5. |
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13.3 At such time as a Qualified Holder of a Class B common share ceases to be a Qualified Holder without first effecting a conversion of such Class B common share into a Class A common share, there shall be a breach of these Articles with the effect that (i) such Class B common share shall immediately be considered an Affected Class B common share with respect to which a Conversion Trigger described in Article 14.3(a)(ii) occurred at the time such person ceased to be a Qualified Holder and (ii) the Board may suspend the voting rights of such Class B common share until such Class B common share is converted in accordance with Article 14.5. |
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13.4 If a holder of Class B common shares wishes to Transfer any such shares, he shall provide notice to the Company, (a) specifying the number of Class B common shares he wishes to Transfer and the identity of the transferee(s) of such shares (which shall not exceed four (4) transferees for any one share), (b) representing to the Company that the proposed Transfer is a Permitted Transfer and (c) describing such holder’s basis for such representation. In determining whether any such Transfer is a Permitted Transfer, the Board may request such additional information from the holder of such Class B common share as it determines is reasonably necessary to enable the Board to make such determination. The Board shall determine whether such Transfer meets (or does not meet) the definition of a Permitted Transfer, which determination will be final and binding on the holder of such share. The Board shall not be required to give any reasons for its determination, and the Company shall not be held liable for any losses resulting from any such determination or any delay by the Board in making such determination. |
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13.5 The Board may, from time to time, establish such additional policies and procedures (not in violation of the Act or applicable laws or regulations, including these Articles) relating to the Transfer of Class B common shares as the Board may determine necessary or advisable in connection therewith. |
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13.6 For purposes of this Article 13, a “Transfer” of any Class B common share (a) means any direct or indirect sale, assignment, transfer, conveyance or other transfer or disposition of such Class B common share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law, including the transfer of voting control with respect to such share by proxy or otherwise, and (b) shall be deemed to occur with respect to a Class B common share held by a Qualified Holder if there occurs any act or circumstance that would result in such person ceasing to be a Qualified Holder, including as a result of the transfer, in one transaction or a series of transactions, of voting securities in such person or the right to elect or appoint the directors or managers of such person to persons who are not otherwise Qualified Holders. “Transferred” shall have a correlative meaning. |
Notwithstanding the foregoing, the following shall not be considered a “Transfer” for such purposes:
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(a) the granting of a revocable proxy to directors or officers of the Company in connection with actions to be taken at general meetings of the Company; |
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(b) the entering into a voting trust, agreement or arrangement solely with other holders of Class B common shares, which voting trust, agreement or arrangement is disclosed in writing to the Secretary of the Company; |
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(c) any change in the trustees or the persons having or exercising voting control over Class B common shares held by any Permitted Entity, so long as, after such change, such Permitted Entity continues to be a Qualified Holder; |
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(d) the pledging or granting of a security interest over a Class B common share in connection with a bona fide loan or indebtedness transaction and, following acceleration but prior to enforcement, the exercise of or entitlement to voting rights in respect of such share, by the pledgee or holder of such other security interest to the extent provided for in such pledge or security interest, excluding, for the avoidance of doubt, any sale, assignment, transfer, conveyance or other transfer or disposition of such Class B common share as a result of the enforcement of such pledges or security interests; |
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(e) any existing or replacement pledges of or security interests in Class B common Shares by Parent or any Subsidiary of Parent pursuant to the security documents relating to the 7.125%/7.875% Senior Secured Toggle Notes due 2023 and the 6.625%/7.375% Senior Secured Toggle Notes due 2023 issued by ARD Finance S.A. (or any renewal, extension, substitution, refinancing or replacement of such notes) and, following acceleration but prior to enforcement, the exercise of or entitlement to voting rights in respect of such Class B common shares, by the pledgee or holder of such other security interest to the extent provided for in such pledge or security interest, excluding, for the avoidance of doubt, any sale, assignment, transfer, conveyance or other transfer or disposition of such Class B common shares as a result of the enforcement of such pledges or security interests; |
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(f) a transfer to the Acquiror pursuant to Article 15; or |
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(g) any transfer to the Company. |
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14. Conversion of Class B Common Shares |
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14.1 All Class B common shares are issued as repurchasable shares (actions rachetables) pursuant to the terms of Article 49-8 of the Act. |
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14.2 Following the occurrence of a Conversion Trigger, each Class B common share will be converted into one Class A common share at the time and in accordance with the procedures set forth in this Article 14 (the "Conversion"). |
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14.3 For purposes of this Article 14, a “Conversion Trigger” will occur: |
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(a) with respect to any Class B common share, (i) at any time at the option of the holder of such Class B common share, exercised by notice to the Company, or (ii) upon the holder of such Class B common share ceasing to be a Qualified Holder; or |
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(b) with respect to all Class B common shares, at such time as the Register of Shareholders reflects (or the Board otherwise determines) that Qualified Holders cease to own, directly or indirectly, in the aggregate, Class B common shares constituting at least ten per cent (10%) of the aggregate number of then issued Common Shares, excluding for purposes of such calculation any Treasury Shares. |
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14.4 The Board shall effect the Conversion of any Class B common share in respect of which a Conversion Trigger shall have occurred (the “Affected Class B common share”) no later than 14 days following the receipt by the Company of notice to the Company (in the case of the Conversion Trigger described in Article 14.3(a)) or the Company becoming aware of the occurrence of the Conversion Trigger (in the case of a Conversion Trigger described |
in Article 14.3(b)), provided that the Company shall not be liable for any losses incurred by any person resulting from any delay in effecting any Conversion. |
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14.5 The Conversion will be implemented in the following manner: |
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(a) each Affected Class B common share will be repurchased by the Company for its par value, with no cash payment being made to a Shareholder whose Class B common share is being so repurchased (the “Relevant Shareholder”); |
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(b) the Company shall issue one Class A common share to the Relevant Shareholder for each Affected Class B common share repurchased and the purchase price for each Affected Class B common share shall remain outstanding as a claim of the Relevant Shareholder against the Company which claim will be set off against the subscription price payable by the Relevant Shareholder for each Class A common share; |
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(c) upon set-off of the claim pursuant to Article 14.5(b) in satisfaction of the subscription price in respect of each Class A common share the Company shall credit EUR 0.09 to the share premium account of the Company and EUR 0.01 to the share capital account of the Company in respect of each Class A common share; and |
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(d) each Affected Class B common share that is repurchased by the Company will be cancelled by the Company and not available for reissuance. |
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14.6 In furtherance (but not in limitation) of the provisions of this Article 14, the Chairman for the time being (or some other person appointed by the Company for this purpose) shall be deemed to have been appointed attorney of each of the Relevant Shareholders with full power to execute, complete and deliver, in the name and on behalf of each Relevant Shareholder any closing documents and deliverables as the Board may reasonably require so as to implement a Conversion. |
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14.7 The Board shall be authorised to appoint, in its absolute discretion, a representative, to appear before a public notary in Luxembourg for the purpose of amending the Articles to reflect the changes resulting from the cancellation of any Class B common shares repurchased, and the corresponding issue of any Class A common shares issued, in accordance with the terms of this Article 14. |
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14.8 The Company may, from time to time, establish such additional policies and procedures (not in violation of the Act or applicable laws or regulations, including these Articles) relating to the conversion of Class B common shares as the Board may determine necessary or advisable in connection therewith. |
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15. Compulsory Transfer of Shares |
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15.1 If, at any time, a person is or becomes, directly or indirectly, the owner of seventy-five per cent (75%) or more of the number of issued shares of the Company, such person (the “Acquiror”) may require the holders (the “Remaining Holders”) of the remaining issued shares of the Company (the “Remaining Shares”) to sell their shares to him. The Acquiror shall exercise his right to acquire such shares by giving notice to the Company (an "Article 15 Notice") that specifies: (a) the identity and contact details of the Acquiror, (b) the price that the Acquiror will pay for the Remaining Shares (being the fair market value thereof as determined in accordance with this Article 15) or, if not yet determined, the identity of the independent investment banking firm of international reputation that will be engaged by the Acquiror (the “Acquiror Expert”) to determine the fair market value of the Remaining Shares; (c) the Acquiror’s sources of payment of the purchase price for the Remaining Shares (which payment must be in the form |
of cash), and evidence that the Acquiror has secured funds sufficient to make such payment; and (d) subject to this Article 15, any other conditions governing the purchase of the shares. |
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15.2 Promptly (but, in any event, within fourteen (14) days) following receipt by the Company of an Article 15 Notice, the Company shall (a) serve notice in writing on all the Remaining Holders (the "Compulsory Acquisition Notice"), indicating that the Acquiror has served an Article 15 Notice and outlining the consequences of such service pursuant to this Article 15, (b) the name of the Acquiror Expert retained by the Acquiror to determine the fair market value of the Remaining Shares, and (c) if the Acquiror has so notified the Company, the price determined by the Acquiror Expert as the fair market value of the Remaining Shares (the “Acquiror Purchase Price”). If the Acquiror Purchase Price has not been determined by the Acquiror Expert on the date of the delivery by the Acquiror of the Article 15 Notice, the Acquiror shall cause the Acquiror Expert to determine the Acquiror Purchase Price within 21 days of such date, and shall promptly (but in any event within three (3) days)) following such determination, give notice to the Company thereof. The Company shall promptly thereafter serve notice in writing on all the Remaining Holders indicating the Acquiror Purchase Price. |
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15.3 If Remaining Holders holding at least 10% of the Remaining Shares object to the Acquiror Purchase Price, such Remaining Holders may provide written notice of such objection to the Acquiror (the “Notice of Objection”), with a copy to the Company, no later than 10 days after the date on which the Company notified the Remaining Holders of the Acquiror Purchase Price. If no Notice of Objection is provided to the Acquiror within such time period, the Acquiror Purchase Price shall be final and binding on the Acquiror and all the Remaining Holders and shall be the “Purchase Price” for purposes of this Article 15. The Acquiror and the objecting Remaining Holders may attempt to agree on the fair market value of the Remaining Shares, and any fair market value agreed by the Acquiror and Remaining Holders holding a majority of the Remaining Shares held by all objecting Remaining Holders shall be final and binding on the Acquiror and all the Remaining Holders and shall the “Purchase Price” for purposes of this Article 15. Failing agreement on such fair market value within 15 days of the date of the Notice of Objection, the objecting Remaining Holders may engage, at the expense of the Company, an investment banking firm of international reputation (the “Remaining Holder Expert”) to determine the fair market value of the Remaining Shares. The Remaining Holder Expert shall determine such fair market value within 35 days of the date of the Notice of Objection. If the difference between the fair market value determined by the Remaining Holder Expert and the Acquiror Purchase Price is not more than 10% of the higher valuation, the purchase price for the Remaining Shares shall be the average of the Acquiror Purchase Price and the fair market value determined by the Remaining Holder Expert. If the difference between the fair market value determined by the Remaining Holder Expert and the Acquiror Purchase Price is greater than 10% of the higher valuation, the Acquiror Expert and the Remaining Holder Expert shall select and engage, at the expense of the Company, a third investment banking firm of international reputation to determine the fair market value of the Remaining Shares within 65 days of the date of the Notice of Objection. The fair market value of the Remaining Shares shall be the average of the fair market value of the two (2) closest valuations of the three (3) investment banking firms, and such valuation shall be final and binding on the Acquiror and all the Remaining Holders (the fair market value as determined by the Acquiror Expert, as agreed by the Acquiror and the objecting Remaining Holders in accordance with the second sentence of this Article 15.3 or as determined by the |
investment banking firms in accordance with this Article 15.3, the “Purchase Price”). Subject to execution by the Acquiror Expert, the Remaining Holder Expert and the third investment banking firm of customary confidentiality agreements, the Company shall provide each of them with such financial and other information as they reasonably request to enable them to make their determinations under this Article 15; provided that all three (3) investment banking firms shall receive the same financial and other information. Promptly following the determination of the Purchase Price, the Company shall serve notice in writing on all the Remaining Holders indicating the Purchase Price. |
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15.4 Upon the service of the Compulsory Acquisition Notice, or, if later, the date on which the Remaining Holders are notified by the Company of the Purchase Price, subject to Article 15.5, each of the Remaining Holders shall be required to sell all of the Remaining Shares held by them to the Acquiror, and, subject to Article 15.4, Article 15.5 and the conditions set forth in the Article 15 Notice, the Acquiror shall be bound to acquire all of such shares, for the Purchase Price, and, in furtherance thereof, pay to the Company at the closing of the sale and purchase of the Remaining Shares, for remittance to the Remaining Holders, the consideration to be paid by the Acquiror for all the Remaining Shares. |
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15.5 In selling his Remaining Shares to the Acquiror and accepting the Purchase Price therefor, each Remaining Holder shall represent (or be deemed by virtue of Article 15.7 to represent) to the Acquiror that (i) he has full right, title and interest to such shares, (ii) has all necessary power and authority, and has taken all necessary actions to sell such shares to the Acquiror, and (iii) such shares are free and clear of all liens or encumbrances except those imposed by applicable law or these Articles. Other than the foregoing representations, no Remaining Holder shall be required to make any representations to the Acquiror in connection with the sale of his Remaining Shares under this Article 15. If any Remaining Holder does not (or cannot) make any such representations, or the Acquiror determines before or after its acquisition of the Remaining Shares held by such Remaining Holder that such representations are incorrect, then the Acquiror may, at his option, determine not to acquire such Remaining Holder’s Remaining Shares or, if he has already acquired such shares, pursue any remedies he has against such Remaining Holder for breach of such representations, as applicable. |
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15.6 The closing of such sale and purchase shall occur as promptly as practicable after the service of the Compulsory Acquisition Notice or the determination of the Purchase Price (whichever is later), provided that no Remaining Holder shall be required to sell, and the Acquiror shall not be required to purchase, any Remaining Shares if such purchase or sale would violate any applicable law, regulation or order. |
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15.7 Upon the service of the Compulsory Acquisition Notice, the Company shall be required to take all such actions as may reasonably be requested by the Acquiror to enable it to implement the acquisition by it, and registration in the Register of Shareholders in its name (and/or those of its designee(s)), of all of the Remaining Shares on the terms and conditions set forth in this Article 15. |
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15.8 In furtherance (but not in limitation) of the provisions of this Article 15, the Chairman for the time being (or some other person appointed by the Company for this purpose) shall be deemed to have been appointed attorney of each of the Remaining Holders with full power (and obligation, if so requested by the Acquiror) to execute, complete and deliver, in the name and on behalf of each Remaining Holder (a) a transfer in favor of the Acquiror and/or its designee(s) of all of the shares held by such Remaining Holder against delivery to the Company of the |
Purchase Price for such Remaining Holder’s remaining Shares and (b) subject to Article 15.4, such other closing documents and deliverables as the Acquiror may reasonably require so as to vest all rights and entitlements in or in respect of the shares held by such Remaining Holder in the Acquiror and/or its designee(s) (including a power of attorney in favor of the Acquiror and/or its designee(s) to vote and exercise all rights in respect of such shares pending the registration in the Register of Shareholders of the Acquiror and/or its designee(s) as the holder(s) of such shares). |
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15.9 The Acquiror, on delivery to the Company of the consideration to which the Remaining Holders are entitled in accordance with this Article 15, shall be deemed to have obtained a good discharge for such consideration and, on delivery of such consideration and execution and delivery of the closing documents required to be executed by the Acquiror to effect its purchase of the Remaining Shares, the Acquiror shall be entitled to require the Company to register its name (or that of its designee) in the Register of Shareholders as the holder by transfer of each of the Remaining Shares. |
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15.10 The Company shall, as soon as practicable after its receipt of the consideration for the Remaining Shares and the other closing documents and deliverables required to effect the transfer of such shares, deliver to each Remaining Holder the consideration to which such Remaining Holder is entitled in accordance with this Article 15 or, if in the opinion of the Board it is not reasonably practical to do so at such time, pay the same into a separate bank account, in the name of the Company and shall hold such consideration in trust for the applicable Remaining Holder until such time as the Board considers it appropriate to release such consideration. |
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15.11 If, at the end of the 180th day after delivery by the Acquiror of the Article 15 Notice, the sale of all of the Remaining Shares has not been completed because of the failure of the Acquiror to take any action required to effect such sale within such time period, the Article 15 Notice shall be deemed null and void, the Acquiror shall no longer have the right (or obligation) to purchase the Remaining Shares under this Article 15, and each Remaining Holder and the Company shall be released from their obligations under this Article 15 in respect of the sale of the Remaining Shares. |
ALTERATION OF SHARE CAPITAL
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16. Power to Alter Capital |
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16.1 The Company may from time to time by Special Resolution and subject to Articles 8 and 54.3 and to any greater quorum or majority requirements as may be provided for in the Act, increase, divide, consolidate, subdivide, change the currency denomination of, diminish or otherwise alter or reduce its share capital in any manner permitted by the Act or these Articles, provided that nothing herein shall affect or diminish the authority granted to the Board under Article 7, Article 9 or Article 14. |
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16.2 If, following any alteration or reduction of share capital, a Shareholder would receive a fraction of a share, the Board may, subject to the Act, address such issue in such manner as it thinks fit, including by disregarding such fractional entitlement. |
DIVIDENDS, OTHER DISTRIBUTIONS AND LEGAL RESERVE
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17. Dividends and Other Distributions |
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17.1 Subject to the provisions of the Act, the general meeting may declare dividends by Ordinary Resolution, but no dividend shall exceed the amount recommended by the Board. |
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17.2 No dividend or other distribution may be declared or paid in respect of Class B common shares unless a dividend or distribution in the same amount per share is declared or paid at the same time in respect of the Class A common shares, and vice versa, without regard to the par value of the shares. With respect to share dividends (also known as bonus issues), holders of Class B common shares shall receive a relevant number of Class B common shares corresponding to the amount of the dividend and holders of Class A common shares shall receive a relevant number of Class A common shares corresponding to the amount of the dividend. |
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17.3 The Board may, subject to these Articles and in accordance with the Act, declare an interim dividend (acompte sur dividendes) if it determines that it is appropriate to pay such an interim dividend based on the amount of distributable reserves of the Company. Any such interim dividend will be paid to the Shareholders, in proportion to the number of shares held by them, in accordance with Article 17.2, and such dividend may be paid in cash or wholly or partly in specie in which case the Board may fix the value for distribution in specie of any assets. Any interim dividends declared by the Board and paid during a financial year will be put to the Shareholders at the following general meeting to be declared as final. The Company shall not be required to pay interest with respect to any dividend or distribution declared by the Company, regardless of when or if paid. |
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17.4 Subject to applicable laws and regulations, in order for the Company to determine which Shareholders shall be entitled to receipt of any dividend, the Board may fix a record date, which record date will be the close of business (or such other time as the Board may determine) on the date determined by the Board. In the absence of a record date being fixed, the record date for determining Shareholders entitled to receipt of any dividend shall the close of business in Luxembourg on the day the dividend is declared. |
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17.5 The Board may propose to the general meeting such other distributions (in cash or in specie) to the Shareholders as may be lawfully made out of the assets of the Company. |
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17.6 Any dividend or other payment to any particular Shareholder or Shareholders may be paid in such currency or currencies as may from time to time be determined by the Board and any such payment shall be made in accordance with such rules and regulations (including in relation to the conversion rate or rates) as may be determined by the Board in relation thereto. |
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17.7 Any dividend or other payment which has remained unclaimed for five (5) years from the date the dividend or other payment became due for payment shall, if the Board so resolves, be forfeited and cease to remain owing by the Company. The payment by the Board of any unclaimed dividend or other moneys payable in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof. |
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18. Legal Reserve |
The Company shall be required to allocate a sum of at least five per cent (5%) of its annual net profit to a legal reserve, until such time as the legal reserve amounts to ten per cent (10%) of the Share Capital in Issue. If and to the extent that this legal reserve falls below such ten per cent (10%) amount, the Company shall allocate a sum of at least five per cent (5%) of its annual net profit to restore the legal reserve to the minimum amount required by law.
MEETINGS OF SHAREHOLDERS
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19. General Meetings |
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19.1 An annual general meeting shall be held in each year within six (6) months following the end of the financial year at the Company’s registered office or at such other place in Luxembourg as may be specified in the convening notice. |
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19.2 For at least eight (8) days prior to the annual general meeting, each Shareholder may obtain a copy of the annual accounts of the Company for the preceding financial year at the registered office of the Company and inspect all documents of the Company required by the Act to be made available by the Company for their inspection. |
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19.3 Other general meetings may be held at such place and time as may be specified in the respective convening notices of the meeting whenever such a meeting is necessary. |
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20. Record Date For Shareholder Notice; Voting. |
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20.1 In order for the Company to determine which Shareholders are entitled to notice of or to vote at any meeting of Shareholders or any adjournment thereof, the Board may fix, in advance, a record date, which shall not be more than sixty (60) days before the date of such meeting. If the Board does not fix a record date, the record date for determining Shareholders entitled to notice of or to vote at a meeting of Shareholders shall be at the close of business in Luxembourg on the day that is not a Saturday, Sunday or Luxembourg public holiday next preceding the day on which notice is given. |
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20.2 A determination of Shareholders of record entitled to notice of or to vote at a meeting of Shareholders shall apply to any adjournment of the meeting; provided, however, that the Board may, acting in its sole discretion, fix a new record date for the adjourned meeting. |
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21. Convening of General Meetings |
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21.1 The Board may convene a general meeting whenever in its judgment such a meeting is necessary. The Board may delegate its authority to call the general meeting to the Chairman or any committee of the Board or to one or more board members by resolution. The convening notice for every general meeting shall contain the agenda, be communicated to Shareholders in accordance with the provisions of the Act on at least eight (8) clear days’ notice, unless otherwise provided in the Act, and specify the time and place of the meeting and the general nature of the business to be transacted. The convening notice need not bear the signature of any Director or Officer of the Company. |
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21.2 The Board shall convene a general meeting within a period of one month upon notice to the Company from Shareholders representing at least ten per cent (10%) of the Share Capital in Issue on the date of such notice. In addition, one or more Shareholders who together hold at least ten per cent (10%) of the Share Capital in Issue on the date of the notice to the Company may require that the Company include on the agenda of such general meeting one or more additional items. Such notice to the Company shall be sent at least five (5) clear days prior to the holding of such general meeting. The rights of Shareholders under this Article 21.2 to require that a general meeting be convened or an item be included on the agenda for a general meeting shall be subject to compliance by such Shareholders with Article 21.3. |
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21.3 To be in proper form for purposes of the actions to be taken pursuant to Article 21.2, the notice to the Company given pursuant to Article 21.2 must set forth as to each Shareholder(s) requesting the general meeting or the addition of an item to the agenda for a general meeting: (i) a brief description of, as applicable, the purpose of the general meeting or the business desired to be brought before the general meeting, the text of the proposal or business |
(including the text of any resolutions proposed for consideration and, in the event that such business includes a proposal to amend these Articles, the language of the proposed amendment) and the reasons for conducting such business at the general meeting; (ii) the name and record address of such Shareholder(s) and the name and address of the beneficial owner, if any, on whose behalf the business is being proposed, and (iii) the class or series and number of shares of the Company which are registered in the name of or beneficially owned by such Shareholder(s) or beneficial owner (including any shares as to which such Shareholder(s) or beneficial owner has a right to acquire ownership at any time in the future); (iv) a description of all derivatives, swaps or other transactions or series of transactions engaged in, directly or indirectly, by such Shareholder(s) or beneficial owner, the purpose or effect of which is to give such Shareholder(s) or beneficial owner economic risk similar to ownership of shares of the Company; and (v) a description of all agreements, arrangements, understandings or relationships between such Shareholder(s) or beneficial owner and any other person or persons (including their names) in connection with the proposal of such business by such Shareholder(s) and any material interest of such Shareholder(s) or beneficial owner in such business. |
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21.4 No business may be transacted at a general meeting, other than business that is properly brought before the general meeting by or at the direction of the Board, including upon the request of any Shareholder or Shareholders in accordance with the Act or these Articles. Except as otherwise provided by law, the chairman of the general meeting at which the business proposed by a Shareholder is to be transacted shall have the power and duty to determine whether such Shareholder has complied with this Article 21 in proposing such business, and if any such proposal was not made in accordance with this Article 21, to declare that such proposed business shall not be transacted. |
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22. Participation by telephone or video conference |
The Board may organise participation of the Shareholders in general meetings by telephone or video conference and participation in such a meeting shall constitute presence in person at such meeting. The participation in a meeting by these means is deemed equivalent to a participation in person at the general meeting.
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23. Quorum at General Meetings |
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23.1 At any ordinary general meeting (including the annual general meeting) the holders of in excess of one-third (1/3) of the Share Capital in Issue present in person or by proxy shall form a quorum for the transaction of business. |
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23.2 At any extraordinary general meeting the holders of in excess of one half (1/2) of the Share Capital in Issue present in person or by proxy shall form a quorum for the transaction of business. |
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24. Voting on Ordinary and Special Resolutions |
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24.1 Subject to the Act, any question proposed for the consideration of the Shareholders at any ordinary general meeting shall be decided by the affirmative votes of a simple majority of the votes validly cast on such resolution by Shareholders entitled to vote in accordance with these Articles and in the case of an equality of votes the resolution shall fail. |
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24.2 Subject to the Act, any question proposed for the consideration of the Shareholders at any extraordinary general meeting shall be decided by the affirmative votes of at least two-thirds (2/3) of the votes validly cast on such resolution by Shareholders entitled to vote in accordance with these Articles. |
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25. Instrument of Proxy |
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25.1 A Shareholder may appoint a proxy by an instrument in writing in such form as the Board may approve from time to time and make available to Shareholders to represent such Shareholder at the general meetings of Shareholders. |
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25.2 The Shareholders may vote in writing (by way of a voting form provided by the Company) on resolutions submitted to the general meeting, provided that the voting form includes (a) the name, first name, address and the signature of the relevant Shareholder, (b) the indication of the shares for which the Shareholder will exercise such right, (c) the agenda as set forth in the convening notice and (d) the voting instructions (approval, refusal, abstention) for each point of the agenda. |
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25.3 The appointment of a proxy or submission of a completed voting form must be received by the Company no later than forty-eight (48) hours prior to the scheduled meeting date (or such other time as may be determined by the Company and notified in writing to the Shareholders) at the registered office or at such other place or in such manner as is specified in the notice convening the meeting or in any instrument of proxy or voting form sent out by the Company in relation to the meeting at which the person named in the appointment proposes to vote, and appointment of a proxy or the submission of a voting form which is not received in the manner so permitted shall be invalid. |
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25.4 A Shareholder who is the holder of two or more shares may appoint more than one proxy to represent such Shareholder and vote on his behalf in respect of different shares. |
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25.5 The decision of the chairman of any general meeting as to the validity of any appointment of a proxy or any voting form shall be final. |
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26. Adjournment of General Meeting |
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26.1 The chairman of a general meeting is entitled, at the request or with the authorisation of the Board, to adjourn a general meeting, while in session, for four (4) weeks. The chairman shall so adjourn the meeting at the request of one or more Shareholders representing at least one tenth (1/10) of the Share Capital in Issue. No general meeting may be adjourned more than once. Any adjournment of a general meeting shall cancel any resolution passed at such meeting prior to such adjournment. |
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26.2 Unless the meeting is adjourned to a specific date, place and time announced at the meeting being adjourned, which date, place and time will be publicly announced by the Company, fresh notice of the date, place and time for the resumption of the adjourned meeting shall be given to each Shareholder entitled to attend and vote at the meeting in accordance with these Articles. No business shall be transacted at any adjourned meeting other than business which might properly have been transacted at the meeting had the adjournment not taken place. |
DIRECTORS AND OFFICERS
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27. Number of Directors |
The Board shall consist of no fewer than three (3) Directors and no more than fifteen (15) Directors, with the number of Directors within that range being determined by the Board from time to time. The Board consists of twelve (12) Directors as of 3 March 2017.
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28. Election of Directors |
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28.1 The Board or one or more Shareholders who together hold at least ten per cent (10%) of the Share Capital in Issue on the date of the notice to the Company may nominate any person for election as a Director. Where any person, other than a person proposed for re-election or election as a Director by the Board, is to be nominated for election as a Director, notice to the Company, complying with the requirements of this Article 28.1, must be given of the intention to nominate such person. Where a person is nominated for election as a Director other than by the Board: |
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(a) such notice to the Company must set forth: (i) in respect of each person whom the Shareholder proposes to nominate for election as a Director, (A) the name, age, business address and residence address of the person, (B) the principal occupation or employment of the person, (C) the class or series and number of shares of the Company owned beneficially or of record by the person and (D) any other information relating to the person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of Directors pursuant to applicable laws or regulations or that the Company may reasonably request in order to determine the eligibility of such person to serve as a Director of the Company; (ii) the name and record address of each Shareholder giving the notice and the name and address of the beneficial owner, if any, on whose behalf the person is being nominated; and (iii) the class or series and number of shares of the Company which are registered in the name of or beneficially owned by such Shareholder or beneficial owner (including any shares as to which any such Shareholder or beneficial owner has a right to acquire ownership at any time in the future); (iv) a description of all derivatives, swaps or other transactions or series of transactions engaged in, directly or indirectly, by such Shareholder or beneficial owner, the purpose or effect of which is to give such Shareholder or beneficial owner economic risk similar to ownership of shares of the Company; and (v) a description of all agreements, arrangements, understandings or relationships between such Shareholder or beneficial owner and any other person or persons (including their names) in connection with the proposed nomination by such Shareholder and any material relationship between such Shareholder or beneficial owner and the person proposed to be nominated for election; and |
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(b) such notice must be accompanied by a written consent of each person whom the Shareholder proposes to nominate for election as a Director to being named as a nominee and to serve as a Director if elected. |
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28.2 Except as otherwise provided by law, the chairman of the general meeting at which Directors are to be elected shall have the power and duty to determine whether a proposal to elect Directors made by a Shareholder was made in accordance with this Article 28, and if any such proposal was not made in accordance with this Article 28, to declare that such proposal shall be disregarded. |
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28.3 Except in the case of a vacancy in the office of Director filled by the Board, as provided for in Article 32, the Company may elect Directors by Ordinary Resolution. In a contested election where the number of persons validly proposed for election or re-election to the Board exceeds the number of seats to be filled on the Board at the applicable general meeting, Directors shall be elected by the votes cast by Shareholders present in person or by proxy at such meeting, such that the persons receiving the most affirmative votes (up to the number of Directors to be elected) shall be elected as Directors at such general meeting, and the affirmative vote of a simple majority of the votes cast by Shareholders present in person or by proxy at such meeting shall not be required to elect Directors in such circumstance. Shareholders shall not be entitled to cumulate their votes in such circumstance, but may only cast a for or against vote for each candidate for each share they own. |
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29. Classes of Directors |
The Directors shall be divided into three (3) classes designated Class I, Class II and Class III. The Board shall designate the Directors who will initially serve in each of Class I, Class II and Class III. Each class of Directors shall consist, as nearly as possible, of one third (1/3) of the total number of Directors constituting the entire Board.
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30. Term of Office of Directors |
At the first general meeting which is held after the date of adoption of these Articles for the purpose of electing Directors, the Class I Directors shall be elected for a three (3) year term of office, the Class II Directors shall be elected for a two (2) year term of office and the Class III Directors shall be elected for a one (1) year term of office. At each succeeding annual general meeting, successors to the class of Directors whose term expires at that annual general meeting shall be elected for a three (3) year term of office. If the number of Directors is changed, any increase or decrease shall be apportioned by the Board among the classes so as to maintain the number of Directors in each class as near to equal as possible, and any Director of any class elected to fill a vacancy shall hold office for a term that shall coincide with the remaining term of the other Directors of that class, but in no case shall a decrease in the number of Directors shorten the term of any Director then in office. A Director shall hold office until the annual general meeting for the year in which his term expires, subject to his office being vacated pursuant to Article 32.
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31. Removal of Directors |
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31.1 The mandate of any Director may be terminated, at any time and with or without cause, by the general meeting of Shareholders by means of an Ordinary Resolution in favour of such termination. |
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31.2 If a Director is removed from the Board under Article 31.1, the Shareholders may by means of an Ordinary Resolution fill the vacancy at the meeting at which such Director is removed, provided that any nominee for the vacancy who is proposed by Shareholders shall be proposed in accordance with Article 28.1. |
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32. Vacancy in the Office of Director |
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32.1 The office of Director shall be vacated if the Director: |
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(a) is removed from office pursuant to these Articles or is prohibited from being a Director by law; |
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(b) is or becomes bankrupt, or makes any arrangement or composition with his creditors generally; |
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(c) is or becomes of unsound mind or dies; or |
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(d) resigns his office by notice to the Company. |
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32.2 The Board shall have the power to appoint any person as a Director to fill a vacancy on the Board occurring for any reason other than where the appointment of a Director to fill a vacancy has been made by the Shareholders in accordance with Article 31.2. A Director so appointed shall be appointed to the class of Directors that the Director he is replacing belonged to, provided that such Director shall hold office only until ratification by the Shareholders of his appointment at the next following general meeting and, if such general meeting does not ratify the appointment, such Director shall vacate his office at the conclusion thereof. |
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33. Remuneration of Directors |
The remuneration (if any) of the Directors shall be determined by the Board subject to ratification by Shareholders at a general meeting of Shareholders. Such remuneration shall be deemed to accrue from day to day. Any Director who holds an executive office (including for this purpose the office of Chairman) or who serves on any
Board committee, or who otherwise performs services that in the opinion of the Board are outside the scope of the ordinary duties of a director, may be paid such additional remuneration for such additional services as the Board may determine. The Directors may also be paid all travel, hotel and other expenses properly incurred by them in attending and returning from Board meetings or general meetings, or in connection with the business of the Company or their duties as Directors generally.
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34. Directors to Manage Business |
The business of the Company shall be managed and conducted by or under the direction of the Board. In managing the business of the Company, the Board may exercise all such powers of the Company as are not, by the Act or by these Articles, required to be exercised by the Company in general meeting.
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35. Powers of the Board of Directors |
Without limiting the powers of the Board as described in Article 34, the Board shall represent and bind the Company vis-à-vis third parties and may:
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(a) appoint, suspend, or remove any manager, secretary, clerk, agent or employee of the Company and may fix their remuneration and determine their duties; |
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(b) exercise all the powers of the Company to borrow money and to mortgage or charge or otherwise grant a security interest in its undertaking, property and uncalled capital, or any part thereof, and may authorise the issuance by the Company of debentures, debenture stock and other securities whether outright or as security for any debt, liability or obligation of the Company or any third party; |
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(c) appoint one or more persons to the office of chief executive officer of the Company, who shall, subject to the control of the Board, supervise and administer all of the general business and affairs of the Company; |
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(d) appoint a person to act as manager of the Company's day-to-day business (délégué à la gestion journalière) and may entrust to and confer upon such manager such powers and duties as it deems appropriate for the management and conduct of such daily management and affairs of the Company; |
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(e) by power of attorney, appoint any one or more persons, whether nominated directly or indirectly by the Board, to be an attorney of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Board) and for such period and subject to such conditions as it may think fit and any such power of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board may think fit and may also authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions so vested in the attorney; |
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(f) delegate any of its powers (including the power to sub-delegate) to one or more committees of one or more persons appointed by the Board which may consist partly of non-Directors, provided that every such committee shall consist of a majority of Directors and shall conform to such directions as the Board shall impose on them, and the meetings and proceedings of any such committee shall be governed by the provisions of these Articles regulating the meetings and proceedings of the Board, so far as the same are applicable and are not superseded by directions imposed by the Board; |
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(g) delegate any of its powers (including the power to sub-delegate) to any person on such terms and in such manner as the Board may see fit (not exceeding those vested in or exercisable by the Board); |
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(h) present any petition and make any application in connection with the liquidation or reorganisation of the Company, take any action, both as plaintiff and as defendant before any court, obtain any judgments, decrees, decisions, awards and proceed therewith to execution, acquiesce in settlement, compound and compromise any claim in any manner determined by the Board to be in the interest of the Company; |
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(i) in connection with the issue of any share, pay such commission and brokerage as may be permitted by law; |
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(j) subject to the provisions of Article 33, provide benefits, whether by way of pensions, gratuities or otherwise, for any Director, former Director or other officer or former officer of the Company or to any person who holds or has held any employment with the Company or any of its Subsidiaries or associated companies or any predecessor of the Company or of any such Subsidiary or associated company and to any member of his family or any person who is or was dependent on him, and may set up, establish, support, alter, maintain and continue any scheme for providing all or any such benefits, and for such purposes any Director may be, become or remain a member of, or rejoin, any scheme and receive or retain for his own benefit all benefits to which such Director may be or become entitled thereunder, and the Board may authorise the payment out of the funds of the Company of any premiums, contributions or sums payable by the Company under the provisions of any such scheme in respect of any of the persons described in this Article 35(j); and |
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(k) authorise any person or persons to act on behalf of the Company for any specific purpose and in connection therewith to execute any deed, agreement, document or instrument on behalf of the Company. |
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36. Appointment of Chairman and Secretary |
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36.1 A Chairman may be appointed by the Board from among its members from time to time for such term as the Board deems fit. Unless otherwise determined by the Board, the Chairman shall preside at all meetings of the Board and the Shareholders. In the absence of the Chairman from any meeting of the Board or the Shareholders, the Board shall designate an alternative person to serve as the chairman of such meeting. |
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36.2 A Secretary may be appointed by the Board from time to time for such term as the Board deems fit. The Secretary need not be a Director and shall be responsible for (i) sending convening notices of general meetings as per the instruction of the Board, (ii) calling Board meetings as per the instruction of the Chairman, (iii) keeping the minutes of the meetings of the Board and of the Shareholders and (iv) any other duties entrusted from time to time to the Secretary by the Board. |
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37. Appointment, Duties and Remuneration of Officers |
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37.1 The Board may appoint such Officers (who may or may not be Directors) as the Board may determine for such terms as the Board deems fit. |
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37.2 The Officers shall have such powers and perform such duties in the management, business and affairs of the Company as may be designated by resolution of the Board from time to time. |
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37.3 The Officers shall receive such remuneration as the Board may determine. |
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38. Indemnification of Directors and Officers |
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38.1 The Directors, Chairman, Secretary and other Officers (such term to include any person appointed to any committee by the Board) acting in their capacities as such or, at the request of the Company, as a director, officer, |
employee or agent of another person, including any Subsidiary of the Company, or as the liquidator or trustee (if any) for the Company or any Subsidiary thereof, and every one of them (whether for the time being or formerly), and their heirs, executors and administrators (each, an "indemnified party"), shall, to the extent possible under applicable law, be indemnified and held harmless by the Company from and against all actions, costs, charges, losses, damages and expenses which any of them incur or sustain by or by reason of any act performed or omitted to be performed by any Director, Chairman, Secretary or Officer in their capacities as such or in the other capacities described above, and, to the extent possible under applicable law, no Director, Chairman, Secretary or Officer shall be liable for the actions, omissions or defaults of any other indemnified party, or for the actions of any advisors to the Company or any other persons, including financial institutions, with whom any moneys or assets belonging to the Company are lodged or deposited for safe custody, or for insufficiency or deficiency of any security received by the Company in respect of any of its moneys or assets, or for any other loss, misfortune or damage which may happen in the course of their serving as a Director, Chairman, Secretary or Officer of the Company or, at the request of the Company, as a director, officer, employee or agent of another person, including any Subsidiary of the Company, or as the liquidator or trustee (if any) for the Company or any Subsidiary thereof, or in connection therewith, provided that these indemnity and exculpation provisions shall not extend to any matter in respect of any fraud or dishonesty, gross negligence, wilful misconduct or action giving rise to criminal liability in relation to the Company which may attach to any of the indemnified parties. Each Shareholder agrees to waive any claim or right of action such Shareholder might have, whether individually or by or in the right of the Company, against any Director, Chairman, Secretary or Officer on account of any action taken by such person, or the failure of such person to take any action in the performance of his duties with or for the Company or, at the request of the Company, any other person, provided that such waiver shall not extend to any matter in respect of any fraud or dishonesty, gross negligence, wilful misconduct or action giving rise to criminal liability in relation to the Company which may attach to such person. |
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38.2 The Company may, to the extent possible under applicable law, purchase and maintain insurance for the benefit of any Director or Officer against any liability (to the extent permitted by law) incurred by him under the Act in his capacity as a Director or Officer or indemnifying such Director or Officer in respect of any loss arising or liability attaching to him by virtue of any rule of law in respect of any negligence, default, breach of duty or breach of trust of which the Director or Officer may be guilty in relation to the Company or any Subsidiary thereof. |
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38.3 The Company may, to the extent possible under applicable law, advance moneys to an indemnified party for the costs, charges and expenses incurred by such indemnified party in defending any civil or criminal proceedings against such person, on condition that such indemnified party shall repay the advance if any allegation of fraud or dishonesty in relation to the Company is proved against such person. |
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38.4 The rights conferred on indemnified parties under this Article 38 are contract rights, and any right to indemnification or advancement of expenses under this Article 38 shall not be eliminated or impaired by an amendment to these Articles after the occurrence of the act or omission with respect to which indemnification or advancement of expenses is sought. |
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38.5 The Company is authorised to enter into agreements with any indemnified party providing indemnification or advance of expenses rights to any such person, to the extent possible under applicable law. |
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39. Binding Signatures |
Towards third parties, the Company is in all circumstances committed either by the joint signatures of any two (2) Directors or by the sole signature of the delegate of the Board acting within the limits of his powers.
MEETINGS OF THE BOARD OF DIRECTORS
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40. Board Meetings |
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40.1 The Board may meet for the transaction of business, adjourn and otherwise regulate its meetings as it sees fit. Each Director shall have one (1) vote, and a resolution put to the vote at a Board meeting shall be carried by the affirmative votes of a majority of the votes cast and in the case of an equality of votes, the resolution shall fail and the Chairman of the meeting shall not have a casting vote. |
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40.2 Each Director present at a meeting of the Board shall, in addition to his or her own vote, be entitled to one (1) vote in respect of each other Director not present at the meeting who shall have authorised such Director in respect of such meeting to vote for such other Director in the absence of such other Director. |
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40.3 Any such authority may relate generally to all meetings of the Board or to any specified meeting or meetings and must be in writing and may be sent by mail, facsimile or electronic mail (with customary proof of confirmation that such notice has been transmitted) or any other means of communication approved by the Board and may bear a printed or facsimile signature of the Director giving such authority. The authority must be delivered to the Company for filing prior to or must be produced at the meeting at which a vote is to be cast pursuant thereto. |
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41. Notice of Board Meetings |
A Director may, and the Secretary on the requisition of a Director shall, at any time convene a Board meeting. Notice of a Board meeting shall be deemed to be duly given to a Director if it is given to such Director verbally (including in person or by telephone) or otherwise communicated or sent to such Director by mail or facsimile or electronic mail (with customary proof of confirmation that such notice has been transmitted) at such Director's last known address or in accordance with any other instructions given by such Director to the Company for this purpose.
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42. Participation by telephone or video conference |
Directors may participate in any meeting by video conference or by such telephonic or other communication facilities or means as permit all persons participating in the meeting to communicate with each other simultaneously, and participation in such a meeting shall constitute presence in person at such meeting.
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43. Quorum at Board Meetings |
The quorum necessary for the transaction of business at a Board meeting shall be two (2) Directors present in person.
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44. Board to Continue in the Event of Vacancy |
The Board may act notwithstanding any vacancy in its number, provided that, if the number of Directors is less than the number fixed by the Act as the minimum number of directors, the continuing Director(s) shall, on behalf of the Board, summon a general meeting for the purpose of appointing new Directors to fill the vacancies or for the purpose of adopting any measures within the competence of the general meeting.
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45. Written Resolutions |
A resolution signed by all the Directors, which may be in counterparts, shall be as valid as if it had been passed at a Board meeting duly called and constituted, such resolution to be effective on the date on which the resolution is signed by the last Director.
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46. Validity of Acts of Directors |
All actions taken at any meeting of the Board or by any Director, notwithstanding that it is subsequently discovered that there was a defect in the appointment of a Director or that a Director was disqualified from holding office or had vacated office, shall be as valid as if such Director had been duly appointed, was qualified or had continued to be a Director and had been entitled to take any such action.
CORPORATE RECORDS
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47. Minutes of the Meetings of the Shareholders |
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47.1 The minutes of general meetings of Shareholders shall be drawn up and shall be signed by the Chairman of the general meeting. |
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47.2 Copies of or extracts from the minutes of the general meeting of Shareholders may be certified by the Chairman or the Secretary. |
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48. Minutes of the Meetings of the Board |
The minutes of any meeting of the Board, or extracts thereof, shall be signed by the Chairman or the member of the Board who presided at such meeting.
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49. Place Where Corporate Records Kept |
Minutes prepared in accordance with the Act and these Articles shall be kept by the Secretary at the registered office of the Company.
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50. Service of Notices |
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50.1 A notice (including a notice convening a general meeting) or any other document to be served or delivered by the Company to Shareholders pursuant to these Articles may be served on or delivered to any Shareholder by the Company: |
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(a) by hand delivery to such Shareholder or his authorised agent (and in the case of a notice convening a general meeting, only if such Shareholder has individually agreed to receive notice in such manner); |
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(b) by mailing such notice or document to such Shareholder at his address as recorded in the Register of Shareholders (and in the case of a notice convening a general meeting, only if such Shareholder has individually agreed to receive notice in such manner); |
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(c) by facsimile telecommunication, when directed to a number at which such Shareholder has individually consented in writing to receive notices or documents from the Company (including a notice convening a general meeting); |
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(d) by electronic mail, when directed to an electronic mail address at which such Shareholder has individually consented in writing to receive notice or documents from the Company (including a notice convening a general meeting); or |
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(e) by registered letter to such Shareholder at his address as recorded in the Register of Shareholders in respect of a notice convening a general meeting in circumstances where a Shareholder has not individually consented to receiving notice by other means of communication. |
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50.2 Where a notice or document is served or delivered pursuant to Article 50.1(a), the service or delivery thereof shall be deemed to have been affected at the time such notice or document was delivered to the Shareholder or his authorised agent. |
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50.3 Where a notice or document is served or delivered pursuant to Article 50.1(b), service or delivery thereof shall be deemed to have been affected at the expiration of forty-eight (48) hours after such notice or document was mailed. In proving service or delivery it shall be sufficient to prove that the envelope containing such notice or document was properly addressed, stamped and mailed. |
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50.4 Where a notice or document is served or delivered pursuant to Article 50.1(c) or Article 50.1(d), service or delivery thereof shall be deemed to be affected at the time the facsimile or electronic mail was sent, as evidenced by the records of the Company generated at such time and available to the recipient of such electronically transmitted notice or document upon his request. |
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50.5 Without prejudice to the provisions of Articles 50.1(b) and 50.3, if at any time by reason of the suspension or curtailment of postal services within Luxembourg, the Company is unable to convene a general meeting by notices sent through the mail, a general meeting may be convened by a notice advertised in at least one (1) leading national daily newspaper in Luxembourg, filed with the register of commerce and companies and published on the Recueil Electronique des Sociétés et Associations at least fifteen days before the affected general meeting. In such case, such notice shall be deemed to have been duly served on all Shareholders entitled thereto at noon on the day on which such advertisement shall appear. In any such case the Company shall send, from Luxembourg or elsewhere (as the Board in its opinion considers practical), confirmatory copies of the notice convening the general meeting at least eight (8) days before the meeting by mail (or by facsimile or electronic mail in the case of Shareholders who have consented in writing to receive notices by facsimile or electronic mail as described in Article 50.1(c) and Article 50.1(d)) to those Shareholders whose registered addresses are outside Luxembourg or are in areas of Luxembourg unaffected by such suspension or curtailment of postal services. If at least eight (8) days prior to the time appointed for the holding of the general meeting, the mailing of notices to Shareholders in Luxembourg, or any part thereof that was previously affected, has again (in the opinion of the Board) become practical, to the extent such Shareholders have not received notices convening such meeting by facsimile or electronic mail, the Company shall send confirmatory copies of the notice by mail to such Shareholders. The accidental omission to give any such confirmatory copy of a notice of a general meeting to, or the non-receipt of any such confirmatory copy by, any Shareholder (whether by mail or, if applicable, facsimile or electronic mail) shall not invalidate the proceedings at such general meeting, and no proof need be given that this formality has been complied with. |
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50.6 Notwithstanding anything contained in this Article 50, the Company shall not be obliged to take account of or make any investigations as to the existence of any suspension or curtailment of postal services within or in relation to all or any part of any jurisdiction or other area other than Luxembourg. |
FINANCIAL YEAR
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51. Financial Year |
The financial year of the Company shall begin on 1 January and shall end on 31 December in each year.
AUDITOR
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52. Appointment of Auditor |
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52.1 The operations of the Company shall be supervised by one or several approved statutory auditors (réviseur(s) d'entreprises agréé) as applicable. |
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52.2 Subject to the Act, the Shareholders shall appoint the auditor(s) selected by the audit committee of the Company to hold office for such term as the Shareholders deem fit but not exceeding six (6) years or until a successor is appointed. The auditor shall be eligible for re-appointment. |
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52.3 The Auditor may be a Shareholder but no Director, Officer or employee of the Company shall, during his continuance in office, be eligible to act as an Auditor of the Company. |
VOLUNTARY WINDING-UP AND DISSOLUTION
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53. Winding-Up |
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53.1 The Company may be dissolved at any time by the Shareholders by means of a Special Resolution. In the event of dissolution of the Company, liquidation shall be carried out by one or more liquidators, who may be natural or legal persons, appointed by the general meeting, which shall determine the powers and remuneration of such liquidators. |
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53.2 If the Company shall be dissolved and the assets available for distribution among the Shareholders shall be insufficient to repay the total paid up share capital of the Class A common shares and one-tenth (1/10) of the paid up share capital of the Class B common shares, such assets shall be distributed to the Shareholders in proportion to the number of shares held by them, without regard to the par value of their shares. If in a dissolution the assets available for distribution among the Shareholders shall be more than sufficient to repay the total paid up share capital of the Class A common shares and one-tenth (1/10) of the paid up share capital of the Class B common shares at the commencement of the dissolution, the excess shall be distributed among the Shareholders in proportion to the number of shares held by them at the commencement of the dissolution, without regard to the par value of their shares. |
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53.3 The liquidator may, with the sanction of the Shareholders by means of an Ordinary Resolution, divide amongst the Shareholders in specie or in kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not) and may, for such purpose, set such value as the liquidator deems fair upon any property to be divided as aforesaid and, subject to these Articles and the rights attaching to each share, may determine how such division shall be carried out as between the Shareholders or different classes of Shareholders. The determinations of the liquidator in respect of the distributions described in Article 53.2 and this Article 53.3 shall be final. |
CHANGES TO CONSTITUTION
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54. Changes to Articles |
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54.1 No Article may be rescinded, altered or amended and no new Article may be made save in accordance with the Act and until it has been approved by the Shareholders by means of a Special Resolution or approved by the Board in accordance with these Articles. |
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54.2 The following provisions of these Articles may not be rescinded, altered or amended until such rescission, alteration or amendment has been approved by the affirmative vote of a simple majority of the votes validly cast by holders of Class A common shares voting as a class at an ordinary general meeting at which the holders of in excess of one-third (1/3) of the Class A common shares are present in person or by proxy and subject to any applicable greater quorum or majority requirements as may be provided for in the Act: Articles 6.4 and 6.5, Article 7.3(b), Article 10.1, Article 13, Article 14, Article 15, Article 17.2 and this Article 54, including in each case any related definitions, except to the extent any such rescission, alteration or amendment is intended to correct a manifest error or otherwise would not adversely affect the holders of Class A common shares. |
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54.3 Notwithstanding Article 7.1, except as provided in clauses (i) and (ii) of Article 7.3(b), Shareholders shall not, whether by granting authorisation to the Board to do so from authorised share capital or resolving upon such issuance at a general meeting, approve the issuance by the Company of Class B common shares unless such authorisation or issuance has been approved by the affirmative vote of a simple majority of the votes validly cast by holders of Class A common shares voting as a class at an ordinary general meeting at which the holders of in excess of one-third (1/3) of the Class A common shares are present in person or by proxy, subject to any applicable greater quorum or majority requirements as may be provided for in the Act. |
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55. Governing Law |
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55.1 All matters not governed by these Articles shall be determined in accordance with the laws of Luxembourg. |
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55.2 Notwithstanding anything contained in these Articles, the provisions of these Articles are subject to any applicable law and legislation, including the Act, except where these Articles contain provisions which are stricter than those required pursuant to any applicable law and legislation, including the Act. |
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55.3 Should any clause of these Articles be declared null and void, this shall not affect the validity of the other clauses of these Articles. |
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55.4 In the case of any divergences between the English and the French text, the English text will prevail. |
Exhibit 2.1
DESCRIPTION OF SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934
The following description of our share capital summarizes certain provisions of the Articles of Association of Ardagh Group S.A. (our “Articles”). Such summaries do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all of the provisions of our Articles, the form of which has been filed as an exhibit to our Annual Report on Form 20-F.
Common shares
Ardagh Group S.A. (the “Company,” “we,” “us” and “our”) has two classes of common shares: Class A common shares, with a par value of €0.01 per share (the “Class A common shares”) and Class B common shares, with a par value of €0.10 per share (the “Class B common shares,” and together with the Class A common shares, collectively, the “common shares”). Our Class A common shares are registered pursuant to Section 12(b) of the Exchange Act and listed on the New York Stock Exchange under the symbol “ARD”. Our class B common shares are not listed or registered pursuant to the Exchange Act.
The rights of the holders of our Class A common shares and Class B common shares are identical except for par value, voting and conversion rights. The Class A common shares and Class B common shares are entitled to participate equally in distributions made by the Company, with economic entitlement being proportionate to the number of shares held in the Company and not the percentage of share capital of a shareholder. Each Class A common share is entitled to one vote per share. Each Class B common share is entitled to ten votes per share.
Common shares are issued in registered form only and no certificates are issued. The Company is entitled to treat the registered holder of any common share as the absolute owner thereof and is not bound to recognize any equitable claim or other claim or interest in such share on the part of any other person.
Issuance of common shares
Our shareholders have authorized the board of directors to issue common shares up to the maximum amount of the authorized unissued share capital of the Company for a period of five years from March 3, 2017 to such persons, on such terms and for such consideration as the board of directors determines in its absolute discretion. Shareholders may at a general meeting renew or extend such authorized share capital and authorization to the board of directors to issue shares. Notwithstanding the foregoing, the authorization to the board of directors to issue common shares does not permit the issuance of Class B common shares in excess of the 217,696,000 Class B common shares currently issued and outstanding except (i) in connection with stock splits or share dividends (also known as bonus issues) being made to all holders of outstanding common shares in accordance with the principles applicable to dividends described under “Dividend Rights” or (ii) in connection with a reorganization of ARD Holdings S.A. in which the number of Class B common shares issued in connection with such reorganization is substantially the same as or less than the number of Class B common shares received by the Company in connection with such reorganization and which are to be cancelled by the Company in due course.
The Company may issue additional shares, including preference shares, from time to time, either at par or at a premium and with such rights and restrictions (with respect to dividends, voting, return of capital, or otherwise) as we may direct by resolution passed at an extraordinary general meeting held in the manner required for an amendment to the Articles, or as may be determined by the board of directors pursuant to the authority to issue authorized shares, as provided for in the Articles.
No Preemptive Rights
Our Articles provide (subject to the limitations described above) that the board of directors is authorized to issue shares for a period of 5 years from March 3, 2017 within the limits of the authorized share capital and to limit or withdraw any and all statutory preemptive rights which would be applicable in respect of such issuance. This authorization may be renewed, amended or extended by special resolution at a general meeting of shareholders, and the Company plans to seek such renewal in the future.
Meetings of shareholders
The Company convenes at least one general meeting of shareholders each calendar year (the “annual general meeting”) for the purpose of, among other things, approving the annual accounts and electing directors. Under Luxembourg Law, the annual general meeting must be held within six months of the end of the fiscal year. A general meeting can be adjourned at the request of one or more shareholders representing at least 10% of the share capital in issue, taking into account the par value of each Class A common share (€0.01) and the par value of each Class B common share (€0.10) (the “10% threshold”).
The board of directors may convene any general meeting whenever in its judgment such a meeting is necessary. The board of directors may delegate its authority to call the general meeting to the Chairman or any committee of the board of directors or to one or more board members by resolution. The board of directors must convene a general meeting within a period of one month upon notice, which notice must set forth certain information specified in the Articles, to the Company from shareholders holding at least the 10% threshold on the date of such notice. In addition, one or more shareholders who together hold the 10% threshold on the date of the notice to the Company, which notice must set forth certain information specified in the Articles, may require that the Company include on the agenda of such general meeting one or more additional items. At least eight days’ notice to shareholders is required for a general meeting. No business may be transacted at a general meeting, other than business that is properly brought before the general meeting in accordance with our Articles.
Voting rights
Holders of our Class B common shares are entitled to ten votes per share and holders of our Class A common shares are entitled to one vote per share on all matters submitted to a vote of holders of common shares. The holders of our Class A common shares and Class B common shares vote together on all matters, unless otherwise required by Luxembourg Law or our Articles. Luxembourg Law does not provide for cumulative voting in the election of directors. Voting of shareholders at a general meeting may be in person, by proxy or by voting form. Our Articles specify how the Company shall determine the shareholders of record entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof.
Our Articles distinguish ordinary resolutions and special resolutions.
Ordinary Resolutions. Our Articles require a quorum of at least one‑third (1/3) of the share capital in issue present in person or by proxy, taking into account the par value of each Class A common share (€0.01) and the par value of each Class B common share (€0.10) (in effect one‑third (1/3) of the total voting rights), for any ordinary resolutions to be considered at a general meeting, and such ordinary resolutions are adopted by a simple majority of votes validly cast on such resolution by shareholders entitled to vote. Abstentions and nil votes are not taken into account.
Special Resolutions. Our Articles require special resolutions adopted at an extraordinary general meeting for any of the following matters, among other things: (a) an increase or decrease of the authorized or issued share capital, (b) an amendment to our Articles and (c) dissolving the Company. Pursuant to our Articles, for any special resolutions to be considered at a general meeting the quorum is at least one‑half (1/2) of the share capital in issue present in person or by proxy, taking into account the par value of each Class A common share (€0.01) and the par value of each Class B common share (€0.10) (in effect one‑half (1/2) of the voting rights), unless otherwise mandatorily required by Luxembourg Law. Any special resolution may be adopted at a general meeting at which a quorum is present (except as otherwise provided by mandatory law) by the affirmative vote of holders of at least two‑thirds (2/3) of the votes validly cast on such resolution by shareholders entitled to vote.
ARD Finance S.A. (the “Parent Company”), by virtue of its ownership of our Class B common shares, can control the outcome of any action requiring the general approval of our shareholders (except for any action which relates to variation of class rights or requires unanimous approval).
The board of directors may suspend the right to vote of any shareholder if such shareholder fails to fulfill its obligations under the Articles or any deed of subscription or deed of commitment entered into by such shareholder.
Amendment of the Articles
Except where the Articles authorize the board of directors to approve an increase or a reduction in share capital and subsequently record such change within thirty (30) days in the presence of a Luxembourg notary, our Articles require a special resolution approved at an extraordinary general meeting of shareholders to amend the Articles. The agenda of the extraordinary general meeting of shareholders must indicate the proposed amendments to the Articles. Any resolutions to amend the Articles must be taken before a Luxembourg notary and such amendments must be published in accordance with Luxembourg Law.
Certain provisions of our Articles relating to the rights of Class B common shareholders, the ability of the board of directors to issue additional Class B common shares, the ability of the board of directors to suspend voting rights for breach of the Articles, the provisions described under “—Conversion” below, the provisions described under “Compulsory Transfer of Shares,” the provisions requiring equivalent dividends for Class A common shares and Class B common shares and the amendment provisions of the Articles, may not be rescinded, altered or amended without approval by the affirmative vote of a simple majority of the votes validly cast by holders of Class A common shares voting as a class at which holders of in excess of one‑third (1/3) of the Class A common shares are
present in person or by proxy (the “Class A Approval”) and subject to any applicable greater quorum or majority requirements as may be provided for under Luxembourg Law; provided that no such class vote is required to correct a manifest error or for an amendment that would not adversely affect the holders of Class A common shares.
Under Luxembourg Law, where a resolution of an extraordinary general meeting of shareholders will change the rights of the Class A common shares or the Class B common shares or any other outstanding class of shares, the resolution must, in order to be valid, fulfil the quorum and voting requirements for an extraordinary general meeting with respect to each such class.
Conversion
The Class A common shares are not subject to any conversion right.
Each Class B common share is issued as a repurchasable share under Luxembourg Law, and may therefore be repurchased by the Company in exchange for one Class A common share in accordance with the procedure set out in our Articles.
Dividend rights
Under Luxembourg Law, dividends may only be declared from the freely available distributable reserves of the Company. Interim dividends may be declared by the board of directors, subject to certain mandatory legal requirements as detailed in the Articles. The general meeting of shareholders would in the normal course be asked to declare as final the interim dividends paid during the year. The shareholders may declare dividends at a general meeting, but, in accordance with the Articles, such dividends may not exceed the amount recommended by the board of directors.
Our Articles provide that no dividends or other distributions may be declared or paid in respect of Class B common shares unless a dividend or distribution in the same amount per share or, in the case of share dividends (also known as bonus issues) in the same ratio, is declared or paid at the same time in respect of the Class A common shares, and vice versa, without regard to the par value of the shares, provided that with respect to share dividends (also known as bonus issues), holders of Class B common shares will receive a relevant number of Class B common shares corresponding to the amount of the dividend and holders of Class A common shares will receive a relevant number of Class A common shares corresponding to the amount of the dividend.
Distributions on winding up of the Company
Any voluntary dissolution of the Company will take place in accordance with the provisions of Luxembourg Law. We may only be placed into voluntary dissolution if shareholders vote in favor of such dissolution by means of a special resolution passed at an extraordinary general meeting.
In the event of our liquidation, dissolution or winding up, the holders of common shares are entitled to share equally and ratably in our assets, if any, remaining after the payment of all of our debts and liabilities in proportion to the number of shares owned by them, without regard to the par value of the shares.
Because all shares of the Company are fully paid, shareholders will have no liability in the event of a winding up of the Company, unless they are deemed to be a de facto manager (gérant de fait) exercising effective and continuing control over the Company by positive actions.
Share repurchases
Pursuant to our Articles, our board of directors may purchase our own shares in accordance with Luxembourg Law on such terms and in such manner as may be authorized by the general meeting of shareholders in an ordinary resolution, subject to the rules of any stock exchange on which our shares are traded.
Our Articles provide that the board of directors is authorized for a period of 5 years from March 3, 2017 to make (i) open market repurchases of Class A common stock subject to certain conditions and (ii) repurchases of shares other than as described in (i) where the same terms are offered to all shareholders in a similar situation.
Board of Directors
Our Articles provide that our business is to be managed and conducted by or under the direction of our board of directors. In managing the business of the Company, the board of directors may exercise all the powers of the Company that are not reserved by Luxembourg Law or by the Articles to the general meeting of shareholders. There is no requirement in our Articles or Luxembourg Law that directors hold any of our shares. There is also no requirement in our Articles or Luxembourg Law that directors must retire at a certain age.
Our board of directors is classified into three classes of directors that are, as nearly as possible, one third (1/3) of the total number of directors constituting the entire board of directors. Each class of directors is elected for a three‑year term of office, but the terms are staggered so that the term of only one class of directors expires at each annual general meeting. Any director appointed to fill any vacancy on the board of directors must be put in a specific class and only serves until the term of such class expires.
Our Articles provide that any director may be removed at a shareholders meeting with or without cause by an ordinary resolution and any vacancy on the board of directors, may be filled by our board of directors (other than where a director is removed from office by the shareholders, in which case the shareholders shall elect a director to fill such vacancy by ordinary resolution in accordance with our Articles), acting by a simple majority, on a provisional basis until the provisional appointment of the director appointed by the board of directors is confirmed at the next general meeting of shareholders.
The compensation of our directors will be determined by our board of directors subject to ratification by shareholders, and there is no requirement that a specified number or percentage of independent directors must approve any such determination. Our directors may also be paid all travel, hotel and other expenses properly incurred by them in connection with our business or their duties as directors. Our directors who are also employees of the Company are not expected to receive separate compensation for their service as directors.
Mergers and de‑mergers
A merger by absorption whereby a Luxembourg company, after its dissolution without liquidation, transfers to the absorbing company all of its assets and liabilities in exchange for the issuance to the shareholders of the company being acquired of shares in the acquiring company, or a merger effected by transfer of assets to a newly incorporated company, must, in principle, subject to certain exceptions, be approved by a special resolution of shareholders of the Luxembourg company to be held before a notary. Similarly, a de‑merger of a Luxembourg company is, in principle, subject to certain exceptions subject to the approval by a special resolution of shareholders.
Compulsory Transfer of Shares
Our Articles provide that at any time a person is or becomes, directly or indirectly, the owner of 75% or more of the number of issued shares of the Company, such person (the “Acquiror”) may require, by giving notice to the Company as specified in our Articles, the holders of the remaining issued shares of the Company to sell their shares to the Acquiror for cash at a price that reflects the fair market value of such shares as initially determined by an independent investment banking firm of international reputation retained by the Acquiror. Our Articles contain procedures for determining the fair market value of the shares held by the minority shareholders, which include a dispute resolution provision permitting holders of at least 10% of the remaining shares of the Company to dispute the purchase price proposed by the Acquiror in accordance with the procedures set forth in our Articles.
Anti‑Takeover Provisions
Certain provisions of our Articles may have the effect of delaying, deferring or discouraging another person from acquiring control of us, including the following:
•Control by Class B common shareholders. As described above in “—Voting Rights,” our Articles provide for a dual class share structure, which, for so long as Class B common shares are issued and outstanding, will allow our Parent Company to control the outcome of most matters requiring shareholder approval, even if it owns Class B common shares representing significantly less than a majority of the Company’s issued and outstanding common shares. As a result, the holders of our Class B common shares could delay or prevent the approval of a change of control transaction that may otherwise be approved by the holders of the issued and outstanding Class A common shares.
•Classified Board. Our board of directors is classified into three classes of directors that are, as nearly as possible, of equal size. Each class of directors are elected for a three‑year term of office, but the terms are staggered so that the term of only one class of directors expires at each annual general meeting. The existence of a classified board might deter a potential offeror from seeking to acquire the Company, as, among other things, a potential offeror could not obtain majority control of the Board through a single contested election.
•Notice Requirements for Shareholder Proposals. Luxembourg Law and our Articles provide that one or more shareholders together holding at least the 10% threshold may request the addition of one or more items to the agenda of any general meeting. The request must be sent to the registered office by registered
mail, at last five clear days before the meeting is held. Our Articles also specify certain requirements regarding the form and content of a shareholder’s notice. These requirements may make it more difficult for our shareholders to bring matters before a general meeting.
•Purchase of own shares. Luxembourg Law provides that if the acquisition of the Company’s own shares is necessary to prevent serious and imminent harm to the Company, the acquisition can be made without prior authorization of the general meeting of shareholders.
Indemnification of Directors and Officers
Our Articles provide that we will, to the extent permitted by law, indemnify our directors and officers against liability and expenses reasonably incurred or paid by them in connection with claims, actions, suits or proceedings in which they become involved as a party or otherwise by virtue of performing or having performed as a director or officer, and against amounts paid or incurred by them in the settlement of such claims, actions, suits or proceedings, except in cases of fraud, dishonesty, gross negligence, willful misconduct or action giving rise to criminal liability. The indemnification extends, among other things, to legal fees, costs and amounts paid in the context of a settlement. We have entered into separate indemnification agreements with our directors and executive officers.
Our Articles further provide that we may purchase and maintain insurance or furnish similar protection or make other arrangements, including, but not limited to, providing a trust fund, letter of credit or surety bond on behalf of our directors or officers against any liability asserted against them in their capacity as a director or officer.
COMPARISON OF LUXEMBOURG CORPORATE LAW AND DELAWARE CORPORATE LAW
The following comparison between Luxembourg corporate law, which applies to the Company, and Delaware corporate law, the law under which many corporations in the United States are incorporated, discusses additional matters not otherwise described above. In certain respects, the Articles may provide for provisions that vary the minimum requirements of Luxembourg Law.
Meetings of Shareholders
Luxembourg
Under Luxembourg Law, at least one general meeting of shareholders must be held each financial year in Luxembourg.
Luxembourg Law provides that any general meeting of shareholders may be called by the board of directors of a company or the supervisory auditor of a company and must be called so that it is held within a period of one month upon the written request of shareholders holding not less than the 10% voting rights threshold. One or more shareholders who together hold at least the 10% voting rights threshold may request that one or more additional items be put on the agenda of any general meeting.
Delaware
Shareholders generally do not have the right to call meetings of shareholders unless that right is granted in the certificate of incorporation or by‑laws. However, if a corporation fails to hold its annual meeting within a period of 30 days after the date designated for the annual meeting, or if no date has been designated for a period of 13 months after its last annual meeting, the Delaware Court of Chancery may order a meeting to be held upon the application of a shareholder.
Amendments to the articles of association
Luxembourg
Luxembourg Law provides that amendments to the articles of association of a company generally require an extraordinary general meeting of shareholders held in front of a public notary at which at least 50% of the total voting rights is represented. The notice of the extraordinary general meeting shall indicate the proposed amendments to the articles of association. If the aforementioned quorum is not reached, a second general meeting may be convened by means of a notice published fifteen days before the meeting in the Luxembourg Recueil électronique des sociétés et associations (RESA) and in a Luxembourg newspaper. The second general meeting shall be validly constituted regardless of the proportion of the share capital represented, unless otherwise required in the articles of association. At both meetings, resolutions will be adopted if approved by a majority of 66.67% of the votes validly cast on such resolution by shareholders entitled to vote and subject in certain circumstances to a higher majority and/or separate class votes as required under the articles of association of a company or Luxembourg Law.
However, where classes of shares (i.e., Class A common shares, Class B common shares and, as the case may be, preference shares) exist and the resolution to be adopted by the general meeting of shareholders changes the respective rights attaching to such shares, the resolution will be adopted only if the conditions as to quorum and majority set out above are fulfilled with respect to each class of shares. In addition, as described above under “—Amendment of the Articles”, certain of our Articles may be amended only if the Class A Approval has first been obtained. The shareholders may change the nationality of a Luxembourg company by a resolution of the general meeting of shareholders adopted in the manner required for an amendment of the articles of association of the company. An increase of the commitments of its shareholders requires, however, the unanimous consent of the shareholders.
In very limited circumstances the board of directors may be authorized by the shareholders to amend the articles of association, albeit always within the limits set forth by the shareholders. These include (i) where the board of directors is authorized to transfer the registered office within Luxembourg, (ii) where the board of directors is authorized to issue shares within the company’s authorized unissued share capital and (iii) a cancellation of shares following a repurchase of shares. The board of directors is then authorized to appoint a representative to appear in front of a Luxembourg notary to record the transfer of registered office out of the city of Luxembourg, the capital increase or decrease and to amend the share capital set forth in the articles of association.
Delaware
Amendments to the certificate of incorporation of a Delaware corporation require the affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon or such greater vote as is provided for in the certificate of incorporation. A provision in the certificate of incorporation requiring the vote of a greater number or proportion of the directors or of the holders of any class of shares than is required by Delaware corporate law may not be amended, altered or repealed except by such greater vote.
Duties of directors
Luxembourg
The board of directors must act as a collegiate body in the corporate interest of a company and has the power to take any action necessary or useful to realize the corporate objects of the company, with the exception of the powers reserved by Luxembourg Law or by the articles of association to the general meeting of shareholders. Luxembourg Law imposes a duty on directors of a Luxembourg company to: (i) act in good faith with a view to the best interests of the company; and (ii) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. The standard of care required from directors in the execution of their mandate vis‑à‑vis the company is the standard that the ordinary or reasonable man would apply to his own affairs. The standard of care is more onerous where a director has special skills or where such director receives remuneration for his office.
In addition, Luxembourg Law imposes specific duties on directors and officers of a company to comply with Luxembourg Law and the articles of association of the company.
Delaware
Except as otherwise provided in its certificate of incorporation, the board of directors of a Delaware corporation bears the ultimate responsibility for managing the business and affairs of a corporation. In discharging this function, directors of a Delaware corporation owe fiduciary duties of care and loyalty to the corporation and its shareholders. Delaware courts have decided that the directors of a Delaware corporation are required to exercise an informed business judgment in the performance of their duties. An informed business judgment means that the directors have informed themselves of all material information reasonably available to them. Delaware courts have also subjected directors’ actions to enhanced scrutiny in certain situations, including if directors take certain actions intended to prevent a threatened change in control of the corporation or in connection with transactions involving a conflicted controlling shareholder. In addition, under Delaware law, when the board of directors of a Delaware corporation determines to sell or break‑up a corporation, the board of directors may, in certain circumstances, have a duty to obtain the highest value reasonably available to the shareholders at that time.
Director terms
Luxembourg
Under Luxembourg Law and except as specified differently in the Articles, directors may be re‑elected but the term of their office may not exceed six years. The articles of association may provide for different classes of directors with each class being appointed for a different term.
Delaware
The Delaware General Corporation Law generally provides for a one‑year term for directors, but permits directors to be divided into up to three classes with up to three‑year terms, with the terms for each class expiring in different years, if permitted by the certificate of incorporation, an initial bylaw or a bylaw adopted by the shareholders.
Director vacancies
Luxembourg
Under Luxembourg Law and our Articles, in case of vacancy of the office of a director appointed by the general meeting, unless the vacancy results from the removal of a director by the shareholders, the remaining directors so appointed may fill the vacancy on a provisional basis. In such circumstances, the next general meeting shall make the final appointment. The decision to fill a vacancy is taken by the remaining directors by simple majority vote.
Delaware
The Delaware General Corporation Law provides that vacancies and newly created directorships may be filled by a majority of the directors then in office (even though less than a quorum) unless (a) otherwise provided in the certificate of incorporation or by‑laws of the corporation or (b) the certificate of incorporation directs that a particular class of stock is to elect such director, in which case any other directors elected by such class, or a sole remaining director elected by such class, will fill such vacancy.
Anti‑takeover provisions
Luxembourg
There are no special powers granted by Luxembourg Law to the board of directors of a Luxembourg company, which would enable them to prevent a takeover of the company.
Delaware
In addition to other aspects of Delaware law governing fiduciary duties of directors during a potential takeover, the Delaware General Corporation Law contains a business combination statute that protects Delaware corporations from hostile takeovers and from actions following the takeover by prohibiting some transactions once an acquirer has gained a significant holding in the corporation. Section 203 of the Delaware General Corporation Law prohibits “business combinations,” including mergers, sales and leases of assets, issuances of securities and similar transactions by a corporation or a subsidiary with an interested shareholder that beneficially owns 15% or more of a corporation’s voting stock, within three years after the person becomes an interested shareholder, unless:
•the transaction that caused the person to become an interested shareholder is approved by the board of directors of the corporation prior to the transaction;
•after the completion of the transaction in which the person becomes an interested shareholder, the interested shareholder holds at least 85% of the voting stock of
the corporation not including shares owned by persons who are directors and also officers and shares owned by specified employee benefit plans; or
•after the person becomes an interested shareholder, the business combination is approved by the board of directors of the corporation and holders of at least two‑thirds of the outstanding voting stock, excluding shares held by the interested shareholder.
A Delaware corporation may elect not to be governed by Section 203 by a provision contained in the original certificate of incorporation of the corporation or an amendment to the original certificate of incorporation or to the by‑laws of the company, which amendment must be approved by a majority of the shares entitled to vote and may not be further amended by the board of directors of the corporation. Such an amendment is not effective until twelve months following its adoption.
Compulsory Acquisition
Luxembourg
Luxembourg Law does not provide for the ability of majority shareholders to acquire the interests of a minority shareholder except in the case of a Luxembourg company whose securities to which voting rights are attached are traded on a regulated securities market in one or more member states of the European Economic Area or were admitted on such a market provided that the withdrawal from trading on such a regulated market has become effective not more than five years earlier or were offered to the public which triggered the obligation to publish a prospectus in accordance with Article 3 of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the “Prospectus Regulation”) or for which the obligation to publish a prospectus did not apply in accordance with Article 1 of the Prospective Regulation (in which case, a shareholder holding alone or with persons acting in concert with it, directly or indirectly at least 95% of the company’s shares may acquire the remaining shares for cash at a “fair price”).
We have included in our Articles provisions that allow the direct or indirect holder of 75% of the number of our outstanding shares to acquire the remaining shares for a purchase price payable in cash that is equal to the fair market value of such shares (as determined in accordance with our Articles). See “Description of Share Capital—Compulsory Transfer of Shares”.
Delaware
Under Delaware law, unless the certificate of incorporation of a company provides for a higher standard, subject to the approval of the boards of the directors of the constituent companies, the holder of a majority of the outstanding shares of a corporation can effect the merger of that corporation with another corporation such that the shares of the minority stockholders are converted into the right to receive the merger consideration offered by the majority stockholder. As described under “Duties of Directors,” Delaware courts may subject these types of transactions to enhanced scrutiny, including, in certain circumstances, requiring that these types of transaction be “entirely fair” to the minority stockholders. In addition, stockholders of a Delaware company who do not vote their shares in favor of such a merger are, as a general matter, entitled to an appraisal by the Delaware Court of Chancery of
the fair value of such stockholders’ shares. As described under “Appraisal Rights,” Luxembourg Law does not provide appraisal rights to shareholders.
Removal of directors
Luxembourg
Under Luxembourg Law a director may be removed from office by the shareholders at a general meeting of the shareholders, at any time and with or without cause, by ordinary resolution.
Delaware
Under the Delaware General Corporation Law, any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors, except (a) unless the certificate of incorporation provides otherwise, in the case of a corporation whose board of directors is classified, shareholders may effect such removal only for cause, and (b) in the case of a corporation having cumulative voting, if less than the entire board of directors is to be removed, no director may be removed without cause if the votes cast against his/her removal would be sufficient to elect him if then cumulatively voted at an election of the entire board of directors, or, if there are classes of directors, at an election of the class of directors of which he/she is a part.
Limitation of liability of directors and officers
Luxembourg
Pursuant to Luxembourg Law on agency, agents are generally entitled to be reimbursed any advances or expenses made or incurred in the course of their duties, except in cases of fault or negligence on their part. Luxembourg Law provisions on agency are generally applicable to the mandate of directors and agents of the company. Pursuant to Luxembourg Law, a company is generally liable for any violations committed by employees in the performance of their functions except where such violations are not in any way linked to the duties of the employee.
It is possible to include indemnification provisions in the articles of association of a company setting forth the scope of indemnification of directors and officers. These provisions typically indemnify directors and officers against liability (to the extent permitted by Luxembourg Law) and expenses reasonably incurred or paid by them in connection with claims, actions, suits or proceedings in which they become involved as a party or otherwise by virtue of performing or having performed as a director or officer, and against amounts paid or incurred by them in the settlement of such claims, actions, suits or proceedings, except in cases of fraud, dishonesty, gross negligence, willful misconduct or action giving rise to criminal liability. It is also possible under Luxembourg Law to enter into indemnification agreements with directors and executive officers of a company. Our Articles provide, subject to certain exceptions, for a waiver by shareholders of any claims they may have against our directors.
Delaware
The certificate of incorporation may provide for the elimination of personal monetary liability of directors for breach of fiduciary duties as directors to the fullest extent permissible under the laws of the State of Delaware, except for liability (i) for any breach of a director’s loyalty to the corporation or its shareholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law (iii) under Section 174 of the DGCL (relating to the liability of directors for unlawful payment of a dividend or an unlawful stock purchase or redemption) or (iv) for any transaction from which the director derived an improper personal benefit. The certificate of incorporation may also provide that if the DGCL is amended so as to allow further elimination of, or limitations on, director liability, then the liability of directors will be eliminated or limited to the fullest extent permitted by the DGCL as so amended. A Delaware corporation may also indemnify its directors, officers, employees or agents for certain losses incurred by any of them if such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, in the case of any criminal action, had no reason to believe that his actions were unlawful.
Interested director transactions
Luxembourg
There are no rules under Luxembourg Law preventing a director from entering into contracts or transactions with the company to the extent the contract or the transaction is in the corporate interest of the company.
Luxembourg Law prohibits a director from participating in deliberations and voting on a transaction which has to be considered by the board of directors if that director has a direct or indirect financial interest conflicting with that of the company. The concerned director must advise the board of directors thereof and cause a record of his statement to be included in the minutes of the meeting. Such director may not take part in these deliberations. At the next general meeting of shareholders, before any other resolution is put to the vote, a special report must be made on any transactions in which the directors may have had an interest conflicting with that of the company. These restrictions will not apply where the decision of the board of directors relates to ordinary business entered into under normal conditions.
Delaware
Interested director transactions are permissible and may not be legally voided if:
•either a majority of disinterested directors, or a majority in interest of holders of shares of the corporation’s capital stock entitled to vote upon the matter, approves the transaction upon disclosure of all material facts; or
•the transaction is determined to have been fair as to the corporation as of the time it is authorized, approved or ratified by the board of directors, a committee thereof or the shareholders.
Appraisal rights
Luxembourg
Luxembourg Law does not provide for appraisal rights to shareholders.
Delaware
A shareholder of a Delaware corporation participating in certain corporate transactions may, under certain circumstances, be entitled to appraisal rights under which the shareholder may receive cash in the amount of the fair value of the shares held by that shareholder (as determined by the Delaware Court of Chancery) in lieu of the consideration the shareholder would otherwise receive in the transaction.
Cumulative voting
Luxembourg
The election of directors by cumulative voting is generally not possible under Luxembourg Law.
Delaware
The certificate of incorporation of a Delaware corporation may provide that shareholders of any class or classes or of any series may vote cumulatively either at all elections or at elections under specified circumstances.
Approval of corporate matters by written consent
Luxembourg
Pursuant to Luxembourg Law, shareholders of a public limited liability company may not take actions by written consent. A shareholder meeting must always be called if the matter to be considered requires a shareholder resolution under Luxembourg Law or our Articles. Shareholders may vote by proxy or by submission of a voting form.
Delaware
Unless otherwise specified in a corporation’s certificate of incorporation, shareholders may take action permitted to be taken at an annual or special meeting, without a meeting, notice or a vote, if consents, in writing, setting forth the action, are signed by shareholders with not less than the minimum number of votes necessary to authorize such action at a meeting at which all shareholders entitled to vote were present and voted.
Share repurchases
Luxembourg
Pursuant to Luxembourg Law, a company (or any party acting on its behalf) may repurchase its own shares and hold them in treasury, provided, except in limited circumstances:
•the shareholders at a general meeting have previously authorized the board of directors to acquire company shares. The general meeting shall determine the terms and conditions of the proposed acquisition and in particular the maximum number of shares to be acquired, the period for which the authorization is given (which may not exceed five years) and, in the case of acquisition for value, the maximum and minimum consideration.
•the acquisitions, including shares previously acquired by the company and held by it, and shares acquired by a person acting in his own name but on behalf of the company, may not have the effect of reducing the net assets below the amount of the issued share capital plus the reserves, which may not be distributed by law or under the articles of association.
•only fully paid‑up shares may be repurchased.
As long as shares are held in treasury, the voting rights attached thereto are suspended. Further, to the extent the treasury shares are reflected as assets on the balance sheet of the company, a non‑distributable reserve of the same amount must be reflected as a liability.
Delaware
The board of directors is permitted to authorize share repurchases without shareholder consent.
Shareholder suits
Luxembourg
Pursuant to Luxembourg Law, the board of directors has the widest power to take any action necessary or useful to achieve the corporate object. The board of directors’ powers are limited only by law and the articles of association of the company.
Luxembourg Law generally does not require shareholder approval before legal action may be initiated on behalf of the company. The board of directors has sole authority to decide whether to initiate legal action to enforce the company’s rights (other than, in certain circumstances, in the case of an action against board members). Luxembourg procedural law does not recognize the concept of class actions.
Shareholders do not generally have authority to initiate legal action on the company’s behalf. However, the general meeting of shareholders may vote to initiate legal action against directors on grounds that such directors have failed to perform their duties. Further, one or more shareholders holding at least 10% of the voting rights can take (on behalf of the company) legal action against directors or members of the board of directors for management fault, violation of the articles of association or law. Finally, if a director is responsible for a breach of the Luxembourg Law or of a provision of the articles of association, an action can be initiated by any third party, including a shareholder, that has suffered a loss that is independent and separate from the damage suffered by the company.
Delaware
Class actions and derivative actions generally are available to the shareholders of a Delaware corporation for, among other things, breach of fiduciary duty, corporate waste and actions not taken in accordance with applicable law. In such actions, the court has discretion to permit the winning party to recover attorneys’ fees incurred in connection with such action.
Inspection of books and records
Luxembourg
The register of shareholders of a company is open to inspection, at the company’s registered office, by shareholders.
Each year, the shareholders have the right to inspect, at the Company’s registered office, eight calendar days prior to the annual general meeting among other things (i) the annual accounts and the list of directors and of the supervisory auditors, (ii) the report of the supervisory auditors and (iii) in case of amendments to the articles of association, the text of the proposed amendments and the draft of the resulting consolidated articles of association. Each shareholder shall be entitled to obtain free of charge, upon request and against evidence of his title, eight days before the general meeting, a copy of the annual accounts as well as the report from the management report and of the supervisory auditors.
Delaware
All shareholders of a Delaware corporation have the right, upon written demand, to inspect or obtain copies of the corporation’s shares ledger and its other books and records for any purpose reasonably related to such person’s interest as a shareholder.
Declaration and payment of dividends
Luxembourg
Pursuant to Luxembourg Law, distributions may be made (i) by decision of the general meeting out of available profits (up to the prior year end and after approval of accounts as of the end of and for the prior year) and reserves and (ii) by the board of directors as interim dividends out of available profits and reserves if the articles of association authorize the board of directors to do so. Furthermore, up to 5% of any net profits generated by the company must be allocated to a legal reserve that is not available for distribution, until such legal reserve is equal to 10% of the company’s issued share capital. Generally, distributions may only be made if the following conditions are met:
•except in the event of a reduction of the issued share capital, a distribution to shareholders may not be made if net assets on the closing date of the preceding fiscal year are, or following such distribution would become, less than the sum of the issued share capital plus reserves, which may not be distributed by law or under the articles of association.
•the amount of a distribution to shareholders may not exceed the sum of net profits at the end of the preceding fiscal year plus any profits carried forward and any amounts drawn from reserves which are available for that purpose, less any losses
carried forward and with certain amounts to be placed in reserve in accordance with the law or the articles of association
•Interim distributions may only be made if the following conditions are met:
•interim accounts indicate sufficient funds available for distribution;
•the amount to be distributed may not exceed total profits since the end of the preceding fiscal year for which the annual accounts have been approved, plus any profits carried forward and sums drawn from reserves available for this purpose, less losses carried forward and any sums to be placed in reserves in accordance with the law or the articles of association;
•the board of directors may declare interim distributions no more than 2 months after the date at which the interim accounts have been drawn up;
•review report issued by the company auditor(s) confirming that the above conditions for an interim distribution are met.
The amount of distributions declared by the annual general meeting of shareholders may include (i) the amount previously declared by the board of directors (i.e., the interim distributions for the year of which accounts are being approved), and if proposed (ii) the (new) distributions declared on the annual accounts. Where the payments made on account of interim dividends exceed the amount of the dividends subsequently approved by the shareholders at the annual general meeting, the excess amount shall be deemed to have been paid on account of the next dividend.
Delaware
Under the DGCL, subject to any restrictions contained in the certificate of incorporation, the directors of a corporation may declare and pay dividends upon the shares of its capital stock either (i) out of its surplus or (ii) if there is no surplus, out of its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year, except when the capital of the corporation is diminished by depreciation in the value of its property, or by losses, or otherwise, to an amount less than the aggregate amount of capital represented by the issued and outstanding shares of all classes having a preference on the distribution of assets. “Surplus” is defined in the DGCL as the excess of the net assets of the corporation over capital, as such capital may be adjusted by the board of directors.
Exhibit 4.4
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
TRANSACTION AGREEMENT
by and among
ARDAGH GROUP S.A.,
ELEMENT HOLDINGS II L.P.
and
TRIVIUM PACKAGING B.V.
Dated as of July 14, 2019
1
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Certain Rules of Construction18
TRANSFER; ISSUANCE AND PAYMENT19
Local Acquisition Agreements26
Works Council/Consultation Matters26
Representations and Warranties of Ardagh33
Governmental Consents and Approvals35
Absence of Certain Changes or Events36
Compliance with Law; Permits; Anti-Corruption36
No Other Representations or Warranties50
Representations and Warranties of Element51
Ownership and Operations of NewCo53
Governmental Consents and Approvals53
Absence of Certain Changes or Events54
Compliance with Law; Permits; Anti-Corruption55
No Other Representations or Warranties68
AGREEMENTS OF ARDAGH and ELEMENT68
Conduct of the Ardagh Business68
Conduct of the Exal Business71
Use of Ardagh Names and Marks83
Credit and Performance Support Obligations84
German Profit and Loss Transfer Agreements85
Mutual Services Agreement Matters95
Asset Transfers; Wrong Pockets.95
Fiscal Unity Tax Cooperation97
Terms and Conditions of Employment103
No Third Party Beneficiaries; No Amendment104
Conditions Precedent to the Obligations of the Parties104
Conditions Precedent to the Obligations of Ardagh105
Conditions Precedent to the Obligations of Element105
Frustration of Closing Conditions106
Post-Closing Disputes; Arbitration111
i
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
List of Exhibits [*]
Exhibit A |
Ardagh Sample Closing Statement and Closing Statement Methodologies |
Exhibit B |
Element Sample Closing Statement and Closing Statement Methodologies |
Exhibit C |
Form of Shareholders Agreement |
Exhibit D |
Form of Mutual Services Agreement |
Exhibit E |
Form of IP Cross-License Agreement |
Exhibit F |
French Offer Letter |
Exhibit G |
Dutch Offer Letter |
Exhibit H |
Accrued Benefits Assumptions |
ii
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
TRANSACTION AGREEMENT
THIS TRANSACTION AGREEMENT (this “Agreement”) is made as of July 14, 2019, by and among (i) Ardagh Group S.A., a société anonyme organized under the laws of Luxembourg (“Ardagh”), (ii) Element Holdings II L.P., a Cayman Islands exempted limited partnership (“Element”), and (iii) Trivium Packaging B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized under the laws of the Netherlands (“NewCo”) (each of Ardagh, Element and NewCo, a “Party” and together, the “Parties”).
WITNESSETH:
WHEREAS, on the terms and subject to the conditions set forth herein and in the Related Agreements, Ardagh and Element desire to jointly own Ardagh’s metal food and specialty business (the “Ardagh Business”) and Element’s business (the “Exal Business”);
WHEREAS, the Ardagh Business is currently principally operated by the direct and indirect Subsidiaries of Ardagh set forth on Part A of Schedule 1 (the “Ardagh Purchased Entities”), and the Exal Business is currently operated by the direct and indirect Subsidiaries of Element (excluding NewCo and any of its Subsidiaries prior to the Closing) set forth on Part A of Schedule 2 (the “Exal Purchased Entities”);
WHEREAS, NewCo has been formed by Element as a wholly-owned Subsidiary of Element Netherlands Holding Cooperatief, U.A. to, following the Closing, be jointly owned by Ardagh and Element in accordance with this Agreement and the Shareholders Agreement and to own and operate the Ardagh Business and the Exal Business through its ownership of the Ardagh Purchased Entities and Exal Purchased Entities, respectively;
WHEREAS, in connection therewith, the Parties desire that, at the Closing, (a) Ardagh will, and/or will cause the Ardagh Sellers (as applicable) to, contribute, transfer, grant, sell, convey, assign and deliver to NewCo or its designated Subsidiary all of the Ardagh Equity Interests and (b) Element and the Element Sellers contribute, transfer, grant, sell, convey, assign and deliver to NewCo or its designated Subsidiary all of the Exal Equity Interests, in the manner and subject to the terms and conditions set forth herein;
WHEREAS, under applicable labor Laws, one or more Employee Representative Bodies of certain of the Specified French Entities and of the Specified Dutch Entities are required to be informed and consulted with respect to (a) the offer made by NewCo to acquire the issued share capital of the Specified French Entities held, directly or indirectly, by Ardagh (the “French Shares”) and the issued share capital of the Specified Dutch Entities held, directly or indirectly, by Ardagh (the “Dutch Shares”), respectively, and (b) any security that is contemplated to be granted by or financing undertaken in respect of the Specified French Entities or the Specified Dutch Entities, respectively, in connection with the contemplated Debt Financing;
WHEREAS, the Parties have agreed that, unless and until such consultation has been satisfactorily completed in accordance with Section 2.8 and applicable Law, and Ardagh has accepted, as the case may be, the French Offer or the Dutch Offer, as applicable, (i) this Agreement
1
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
shall not apply to the Specified French Entities and the French Shares or the Specified Dutch Entities and the Dutch Shares, respectively, and (ii) the Closing shall not occur; and
WHEREAS, prior to the date hereof, in order that Ardagh may continue to exploit certain intellectual property for the purpose of the business of developing and manufacturing aluminum bottles, certain intellectual property rights have been transferred by one or more Ardagh Purchased Entities to an Affiliate of Ardagh that is not an Ardagh Purchased Entity; and in order to ensure that NewCo and Ardagh may both independently pursue the business of developing and manufacturing aluminum bottles, Ardagh and NewCo will license to one another pursuant to the IP Cross-License Agreement certain intellectual property (including such transferred intellectual property) commencing as of the Closing relating to the development and manufacture of aluminum bottles and which might facilitate the development of technology to produce commercially viable aluminum bottles.
NOW, THEREFORE, in consideration of the foregoing and of the mutual agreements, covenants, representations, and warranties contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows.
“Action” means any action, suit, proceeding, arbitration, claim, demand, litigation, prosecution, contest, investigation, inquiry, hearing, inquest, audit, complaint, dispute or other legal recourse, in each case, by or before a Governmental Authority or arbitration tribunal, whether civil, criminal, administrative, disciplinary or otherwise.
“Additional Facility” means (a) an asset backed lending facility or (b) as mutually agreed by the Parties, an alternative liquidity facility, in each case, (i) in the principal amount of at least $250 million and to be arranged by Citibank N.A. and provided to NewCo and/or its Subsidiaries and (ii) on terms reasonably satisfactory to each of the Parties.
“Affiliate” means, with respect to any Person, any other Person that, directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person; provided that no Party nor any of its Subsidiaries shall be deemed to be an Affiliate of another Party or its Subsidiaries regardless of any joint venture transaction between them, except that, prior to the Closing, NewCo shall be an Affiliate of Element.
“Ardagh Bank Account” means a bank account to be designated by Ardagh in a written notice to NewCo and Element at least five (5) Business Days prior to the Closing Date.
“Ardagh Business Employee” means any (a) current or former employee of any Ardagh Purchased Entity except any Out-of-Scope Employee and (b) employee of Ardagh or its
2
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Affiliates (other than an Ardagh Purchased Entity) who is named on Section 6.1(a)(ii) of the Ardagh Disclosure Schedule.
“Ardagh Combined Financial Statements” means the audited combined financial statements of the Ardagh Purchased Entities prepared on a carve-out basis from the consolidated financial statements of Ardagh Group S.A. to represent the financial position and performance of the Ardagh Business as if the Ardagh Business had existed on a stand-alone basis as at and for each of the fiscal years ending December 31, 2018, 2017 and 2016 (together with the notes, if any, relating thereto).
“Ardagh Combined Interim Financial Statements” means the unaudited combined financial statements of the Ardagh Purchased Entities prepared on a carve-out basis from the consolidated financial statements of Ardagh Group S.A. to represent the financial position and performance of the Ardagh Business as if the Ardagh Business had existed on a stand-alone basis as at and for the fiscal quarter ending March 31, 2019 (together with the notes, if any, relating thereto).
“Ardagh Disclosure Schedule” means the disclosure schedule delivered by Ardagh to Element immediately prior to the execution and delivery of this Agreement.
“Ardagh Equity Interests” means all of the equity and other ownership interests in those Ardagh Purchased Entities set forth on Part B of Schedule 1.
“Ardagh Existing Indebtedness” means, collectively, (i) that certain Credit and Guaranty Agreement, dated as of December 7, 2017, by and among, inter alios, Ardagh, as the parent, the borrowers from time to time party thereto, the guarantors from time to time party thereto, the lenders from time to time party thereto and Citibank, N.A., as administrative agent and collateral agent, (ii) that certain indenture, dated as of May 16, 2016, by and among Ardagh Packaging Finance plc and Ardagh Holdings USA, Inc., as issuers (collectively, the “Issuers”), Citibank, N.A., London Branch, as trustee, principal paying agent, transfer agent and security agent, Citibank, N.A., as U.S. paying agent, Ardagh, as parent guarantor, the subsidiary guarantors listed therein and Citigroup Global Markets Deutschland AG (as registrar, the “Registrar”), (iii) that certain indenture, dated as of May 16, 2016, by and among the Issuers, Citibank, N.A., London Branch, as trustee, principal paying agent, transfer agent and security agent, Citibank, N.A., as U.S. paying agent, the Company, as parent guarantor, the subsidiary guarantors listed therein and the Registrar, (iv) that certain indenture, dated as of January 30, 2017, by and among the Issuers, Citibank, N.A., London Branch, as trustee, principal paying agent, transfer agent and security agent, Citibank, N.A., as U.S. paying agent, the Company, as parent guarantor, the subsidiary guarantors listed therein and the Registrar, (v) that certain indenture, dated as of March 8, 2017, by and among the Issuers, Citibank, N.A., London Branch, as trustee, principal paying agent, transfer agent and security agent, Citibank, N.A., as U.S. paying agent, Ardagh, as parent guarantor, the subsidiary guarantors listed therein and the Registrar, (vi) that certain indenture, dated as of June 12, 2017, by and among the Issuers, Citibank, N.A., London Branch, as trustee, principal paying agent, transfer agent and security agent, Citibank, N.A., as U.S. paying agent, the Company, as parent guarantor, the subsidiary guarantors listed therein and the Registrar and (vii) that certain indenture, dated as of September 16, 2016, by and among ARD Finance S.A. as issuer,
3
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Citibank, N.A., as U.S. paying agent and the Registrar, in each case of the foregoing clauses (i) through (vii), as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the Closing Date and any security agreements, intercreditor agreements, pledge agreements, mortgages, deeds of trust, collateral assignment, control agreements and related agreements, as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time executed in connection therewith.
“Ardagh Fundamental Representations” means the representations and warranties of Ardagh as set forth in Sections 3.1 (Organization; Authority), 3.2 (Capitalization), 3.3(a) (No Conflict with Organizational Documents), 3.9 (Brokers), and 3.20(b) (Sufficiency of Assets).
“Ardagh Retained Plan” means a Plan sponsored, maintained or contributed to by Ardagh or any of its Affiliates in which any Ardagh Business Employee participates or with respect to which Ardagh or any of its Affiliates has or could reasonably be expected to have any liability related to any Ardagh Business Employee, which includes for this purpose the Ardagh Long Term Incentive Plan and the Ardagh UK Plan other than the Ardagh UK Impress Plan; provided, however, that no Ardagh Transferred Plan shall be an Ardagh Retained Plan.
“Ardagh Sellers” means the Persons set forth on Part C of Schedule 1.
“Ardagh Shared Contracts” means the Contracts set forth on Section 5.17 of the Ardagh Disclosure Schedule (as such schedule may be updated by Ardagh prior to Closing in consultation with Element to add any Contract not identified prior to the date hereof that inures in part to the benefit or burden of an Ardagh Purchased Entity, on the one hand, and Ardagh or its Affiliates (other than the Ardagh Purchased Entities) on the other hand).
“Ardagh Transferred Plan” means a Plan sponsored or maintained by the Ardagh Purchased Entities, which includes for this purpose the Ardagh UK Impress Plan.
“Ardagh UK Impress Plan” means the section of the Ardagh UK Plan known as the Impress Section established by an agreement dated April 5, 2017 and currently governed by a definitive trust deed and rules dated March 28, 2013, as amended, and the related agreement dated April 5, 2017.
“Ardagh UK Plan” means the sectionalized pension plan known as the Ardagh (UK) 2017 Pension Scheme, which is currently governed by a definitive trust deed and rules dated March 28, 2013, as amended.
“Business Day” means a day other than (a) a Saturday or Sunday or (b) any other day on which banks located in New York, NY, Ontario, Canada, London, England, Luxembourg City, Luxembourg or Amsterdam, the Netherlands are required or authorized by Law to be closed for business.
“Business Information Technology” means all tangible or digital computer systems (including computers, screens, servers, workstations, routers, hubs, switches, networks, data communications lines and hardware), software (including source code and object code) and
4
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
telecommunications systems used or held for use by the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable.
“Business IP Agreements” means all licenses of and covenants not to sue regarding Intellectual Property granted to the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable, from any third party (excluding “shrink-wrap” and “click-wrap” licenses and licenses concerning generally commercially available software with aggregate annual license and maintenance fees of less than $25,000) or granted by the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable, to any third party.
“Cash” means, with respect to the Ardagh Purchased Entities or the Exal Purchased Entities, the amount of all cash and cash equivalents (including short term deposits and marketable securities), including all checks that have cleared and in respect of which funds have not yet been received (provided that any such amount is not included in the calculation of the Closing Working Capital Amount), minus (a) overdrafts, (b) outstanding outbound checks and other negotiable instruments used like checks, including outstanding outbound wire transfers issued prior to the Closing Date (provided that any such amount is not included in the calculation of the Closing Working Capital Amount), and (c) the amount of any dividends declared but not yet paid with a record date on or prior to the Closing Date, in each case of the foregoing definition, as determined in accordance with the applicable Closing Statement Methodologies.
“Closing Cash” means all Cash of the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable, as of the Closing.
“Closing Indebtedness” means all Indebtedness of the Ardagh Purchased Entities or the Exal Purchased Entities, as the case may be, as of the Closing (including, with respect to Element, the R&W Costs of Element and its Affiliates).
“Closing Indebtedness Adjustment Amount” means (a) with respect to the Ardagh Purchased Entities, the amount (which may be a positive or negative number) equal to the difference, if any, between the Closing Indebtedness of the Ardagh Purchased Entities and [*] and (b) with respect to the Exal Purchased Entities, the amount (which may be a positive or negative number) equal to the difference, if any, between the Closing Indebtedness of the Exal Purchased Entities and [*]. For the avoidance of doubt, Closing Indebtedness of the Ardagh Purchased Entities or the Exal Purchased Entities (i) in excess of [*], respectively, shall be deemed to be a positive number and (ii) below [*], respectively, shall be deemed to be a negative number.
“Closing Working Capital Amount” means the amount equal to (a) the assets of the Ardagh Purchased Entities or Exal Purchased Entities, as the case may be, with respect to the line items specified in Exhibit A or Exhibit B, respectively, minus (b) the liabilities of the Ardagh Purchased Entities or Exal Purchased Entities, as the case may be, with respect to the line items specified in Exhibit A or Exhibit B, respectively, in each case, calculated as of the Closing (but without giving effect to the consummation of the Transactions unless provided otherwise in the Closing Statement Methodologies) in accordance with the applicable Closing Statement Methodologies. For the avoidance of doubt, (i) each line item so specified shall be treated as an asset or liability, as applicable, for the purposes of the definition of “Closing Working Capital
5
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Amount” and (ii) the determination of the Closing Working Capital Amount shall exclude any amounts (including those line items identified in Exhibit A or Exhibit B, respectively) included in Closing Cash and Closing Indebtedness.
“Closing Working Capital Excess” means (a) with respect to the Ardagh Purchased Entities, the amount, if any, by which the Closing Working Capital Amount of the Ardagh Purchased Entities exceeds the Target Closing Working Capital Amount of the Ardagh Purchased Entities and (b) with respect to the Exal Purchased Entities, the amount, if any, by which the Closing Working Capital Amount of the Exal Purchased Entities exceeds the Target Closing Working Capital Amount of the Exal Purchased Entities.
“Closing Working Capital Shortfall” means (a) with respect to the Ardagh Purchased Entities, the amount, if any, by which the Target Closing Working Capital Amount of the Ardagh Purchased Entities exceeds the Closing Working Capital Amount of the Ardagh Purchased Entities and (b) with respect to the Exal Purchased Entities, the amount, if any, by which the Target Closing Working Capital Amount of the Exal Purchased Entities exceeds the Closing Working Capital Amount of the Exal Purchased Entities.
“Collective Bargaining Agreement” means any collective bargaining agreement, works council agreement or similar labor contract.
“Confidentiality Agreement” means the Confidentiality Agreement, dated December 9, 2018, between Ardagh and Element.
“Contract” means any contract, agreement, indenture, note, bond, mortgage, lease, license (other than Permits), instrument or other commitment or obligation, whether written or oral (to the extent legally binding), including arising out of any course of conduct.
“Control” (including the terms “Controlled by” and “under common Control with”) 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, as a trustee, by contract, or otherwise.
“Conveyance Tax” means any and all excise, sales, use, value added, registration, stamp, recording, documentary, property, transfer and similar Taxes.
“Debt Financing” means (a) the debt financing to be incurred by NewCo (or one or more of its Subsidiaries) in respect of the Transactions, in the amount of $2,750,000,000 and on terms reasonably satisfactory to each of the Parties and (b) the Additional Facility.
“Debt Financing Sources” means each Person that shall provide or facilitate the provision of the Debt Financing to NewCo or one or more of its Subsidiaries.
“Element Bank Account” means a bank account to be designated by Element in a written notice to NewCo and Ardagh at least five (5) Business Days prior to the Closing Date.
6
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Element Disclosure Schedule” means the disclosure schedule delivered by Element to Ardagh immediately prior to the execution and delivery of this Agreement.
“Element Fundamental Representations” means the representations and warranties of Element as set forth in Sections 4.1 (Organization; Authority), 4.2 (Capitalization), 4.3 (Ownership and Operations of NewCo), 4.4(a) (No Conflict with Organizational Documents), 4.10 (Brokers) and 4.21(b) (Sufficiency of Assets).
“Element Plan” means a Plan sponsored, maintained or contributed to by (a) the Exal Purchased Entities or (b) Element or any of its Affiliates in which any Exal Business Employee participates or with respect to which Element or any of its controlled Affiliates (including, for the avoidance of doubt, all Exal Purchased Entities) has or could reasonably be expected to have any liability related to any Exal Business Employee.
“Element Sellers” means those Persons set forth on Part C of Schedule 2.
“Employee Representative Body” means any works’ council, labor union, trade union or similar employee representative body.
“Encumbrance” means any encumbrance, mortgage, fixed or floating charge, pledge, lien, restriction, guarantee, trust, right to acquire, option or right of pre-emption or first refusal, assignment, hypothecation, security interest, title retention, legal or equitable third party right or interest, including any assignment by way of security or trust arrangement for the purpose of providing security, encroachment, deed of trust or deed to secure debt, recorded or unrecorded easement, right of way, covenant, condition, license, reservation, subdivision and other defects of title of any kind or rights of others for rights of way, utilities and similar purposes that adversely affect real property.
“Environmental Law” means any Law pertaining to: (i) the protection of the environment (including air quality, surface water, groundwater, soils, subsurface strata, sediments, drinking water, noise, natural resources and biota) or human health and safety (but only with respect to exposure to Hazardous Materials); or (ii) the use, registration, management, generation, storage, treatment, recycling, disposal, discharge, transportation, Release, threatened Release, investigation or remediation of Hazardous Materials.
“Environmental Permit” means any license, permit, approval, certificate, registration, restriction or other authorization issued by or required from any Governmental Authority, issued under Environmental Laws.
“ERISA” means the U.S. Employee Retirement Income Security Act of 1974, as amended.
“ERISA Affiliate” means, with respect to any Person, any entity that is a member of a “controlled group of corporations” with, or is under “common control” with, or is a member of the same “affiliated service group” with such Person, in each case, as defined in Sections 414(b), (c), (m) or (o) of the U.S. Code.
7
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Escrow Contribution Amount” means the amount, if any, by which the Special Mandatory Redemption Price payable upon a Special Mandatory Redemption (including accrued interest and Additional Amounts (if any) due with respect to the Notes from the Issue Date to the Special Mandatory Redemption Date) exceeds the Escrowed Property (each of the foregoing capitalized terms having the meaning ascribed to such term in the preliminary offering memorandum of Trivium Packaging Finance B.V., dated July 15, 2019, issued with respect to the notes portion of the Debt Financing).
“Estimated Closing Indebtedness Adjustment Amount” means (a) with respect to the Ardagh Purchased Entities, the amount (which may be a positive or negative number) equal to the difference, if any, between the Estimated Ardagh Closing Indebtedness and [*] and (b) with respect to the Exal Purchased Entities, the amount (which may be a positive or negative number) equal to the difference, if any, between the Estimated Exal Closing Indebtedness and [*]. For the avoidance of doubt, Estimated Ardagh Closing Indebtedness or Estimated Exal Closing Indebtedness (i) in excess of [*], respectively, shall be deemed to be a positive number and (ii) below [*], respectively, shall be deemed to be a negative number.
“Estimated Closing Working Capital Excess” means (a) with respect to the Ardagh Purchased Entities, the amount, if any, by which the Estimated Ardagh Closing Working Capital Amount exceeds the Target Closing Working Capital Amount of the Ardagh Purchased Entities and (b) with respect to the Exal Purchased Entities, the amount, if any, by which the Estimated Exal Closing Working Capital Amount exceeds the Target Closing Working Capital Amount of the Exal Purchased Entities.
“Estimated Closing Working Capital Shortfall” means (a) with respect to the Ardagh Purchased Entities, the amount, if any, by which the Target Closing Working Capital Amount of the Ardagh Purchased Entities exceeds the Estimated Ardagh Closing Working Capital Amount and (b) with respect to the Exal Purchased Entities, the amount, if any, by which the Target Closing Working Capital Amount of the Exal Purchased Entities exceeds the Estimated Exal Closing Working Capital Amount.
“Exal Business Employee” means any current or former employee of the Exal Purchased Entities.
“Exal Dividend Overage” means the amount by which any dividends or distributions paid by any Exal Purchased Entity to any equityholder of Element Parent or its Subsidiaries (other than an Exal Purchased Entity) between the date hereof and the Closing Date in accordance with and subject to Section 5.2(e) exceeds [*].
“Exal Equity Interests” means all of the equity and ownership interests in the Exal Purchased Entities set forth on Part B of Schedule 2.
“Exal Existing Indebtedness” means that certain Third Amended and Restated Credit Agreement, dated as of March 3, 2017, by and among Element, as a guarantor, the other guarantors from time to time party thereto, the borrowers from time to time party thereto, the lenders from time to time party thereto, Bank of Montreal, as administrative agent, U.S. collateral
8
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
agent and Dutch collateral agent and TMF Brasil Administração e Gestão de Ativos Ltda., as Brazilian collateral agent, as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the Closing Date and any security agreements, intercreditor agreements, pledge agreements, mortgages, deeds of trust, collateral assignment, control agreements and related agreements, as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time executed in connection therewith.
“Final Closing Statement” means, with respect to an Initial Closing Statement, (a) such Initial Closing Statement, if Ardagh (with respect to the Initial Element Closing Statement) or Element (with respect to the Initial Ardagh Closing Statement) delivers a Notice of Acceptance or fails to deliver a Notice of Disagreement by the Objection Deadline Date or (b) such Initial Closing Statement as modified in accordance with Section 2.9, if Ardagh (with respect to the Initial Element Closing Statement) or Element (with respect to the Initial Ardagh Closing Statement) timely delivers a Notice of Disagreement.
“GAAP” means U.S. generally accepted accounting principles, as in effect from time to time.
“German Fiscal Unities” means the currently existing fiscal unities (Organschaften) for German corporate income and trade Tax purposes (i) between AGMP, as subsidiary, and AGG, as parent, and (ii) between AMPG, as subsidiary, and AGMP, as parent.
“Governmental Authority” means any national, federal, state, local, supranational, regional, or provincial government or any court of competent jurisdiction, administrative or regulatory agency, board, bureau, arbitrator, tribunal, or arbitral body or commission or other national, state, local, supranational, regional or provincial governmental authority or instrumentality entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power.
“Governmental Order” means any order, writ, judgment, injunction, ruling, decision, decree, settlement, stipulation, determination or award of, entered by or with any Governmental Authority.
“Hazardous Materials” means any material, substances or waste that is defined, regulated or otherwise characterized as toxic, hazardous, radioactive, or as a contaminant, pollutant or words of similar meaning or effect under any applicable Environmental Law, and any pesticides, petroleum products, used or waste petroleum products, polychlorinated biphenyls and asbestos.
“IFRS” means the International Financial Reporting Standards as issued by the International Accounting Standards Board.
“Indebtedness” means, as of any time, without duplication, as applied to any Person, (a) all indebtedness of such Person for borrowed money; (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments or debt securities and warrants; (c) all liabilities and obligations of such Person in respect of all performance bonds, banker’s acceptances or letters of credit, to the extent drawn; (d) all interest, fees, prepayment or redemption
9
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
premiums or penalties and other expenses (including breakage costs) owed with respect to any indebtedness, liabilities or obligations of the type referred to in clauses (a) to (c); and (e) all indebtedness, liabilities or obligations of the type referred to in the foregoing clauses (a) through (d) that is directly or indirectly guaranteed by such Person or which such Person has agreed (contingently or otherwise) to purchase, guarantee or otherwise acquire or in respect of which it has otherwise assured a creditor against loss, in each such case in this clause (e), only to the extent such guarantee, or agreement to purchase, guarantee or otherwise acquire is recognized by, and consistent with, the Closing Statement Methodologies. For purposes of this definition, all lease obligations of such Person, including those which are required to be capitalized in accordance with GAAP or IFRS, shall be excluded.
“Indemnified Party” means (a) Element and its Affiliates and (b) NewCo and its Affiliates (for the avoidance of doubt, other than Ardagh and any of its other Affiliates), and each of their respective successors.
“Initial Closing Statement” means, with respect to the Ardagh Purchased Entities, the Initial Ardagh Closing Statement, and with respect to the Exal Purchased Entities, the Initial Element Closing Statement.
“Intellectual Property” means all intellectual property worldwide (i.e., in any country), including all right, title and interest in or to the following: (a) patents and patent applications, (b) trademarks, service marks, trade dress, trade names and internet domain names, together with the goodwill associated exclusively therewith, (c) copyrights, including copyrights in computer software, (d) registrations and applications for registration for any of the foregoing and (e) confidential and proprietary information, including trade secrets and rights in know-how.
“IP Cross-License Agreement” means the agreement to be entered into by and between Ardagh and NewCo on substantially the terms set forth on Exhibit E.
“Knowledge of Ardagh” means the actual knowledge, after reasonable inquiry or investigation, of [*], which reasonable inquiry includes the reasonable inquiry by them of [*].
“Knowledge of Element” means the actual knowledge, after reasonable inquiry or investigation, of [*], which reasonable inquiry includes the reasonable inquiry by them of [*].
“Law” means any national, federal, state, local, supranational or provincial law (including common law), statute, code, Governmental Order, consent decree, doctrine, ordinance, rule, regulation, treaty or other legal requirement of any Governmental Authority.
“Leased Real Property” means real property leased, subleased, sub-subleased, licensed or otherwise occupied by an Ardagh Purchased Entity or an Exal Purchased Entity, as applicable.
“Liabilities” means any and all liabilities and obligations, whether accrued or unaccrued, fixed or variable, known or unknown, absolute or contingent, determined or determinable, or matured or unmatured.
10
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Losses” means any and all losses, Liabilities, damages, assessments, fines, costs and expenses, interest, awards, judgments and penalties (including reasonable lawyers’ and consultants’ fees and expenses of investigation, enforcement or collection in connection therewith) actually suffered or incurred by a Person, but excluding punitive, incidental, consequential, special or indirect losses, Liabilities and damages (including loss of revenues or profits, whether in the present or future, diminution in value or loss of business reputation or opportunity), except to the extent such losses are actually awarded pursuant to a third-party claim.
“Material Adverse Effect” means, with respect to the Ardagh Business (including the Ardagh Purchased Entities) (on the one hand) or the Exal Business (including the Exal Purchased Entities) (on the other hand), any fact, condition, change, effect, event, occurrence, or development that (when taken together with all such other facts, conditions, changes, effects, events, occurrences or developments), individually or in the aggregate, is or would reasonably be expected to (1) prevent or materially impair or materially delay the ability of Ardagh or the Ardagh Sellers (with respect to the Ardagh Business) or Element or the Element Sellers (with respect to the Exal Business), as applicable, to perform their respective obligations under this Agreement or to consummate the Transactions, or (2) have a material adverse effect on the business, properties, assets, financial condition or results of operations of the Ardagh Business, taken as a whole, or the Exal Business, taken as a whole, as applicable; provided, however, that none of the following shall be taken into account in determining whether there has been a Material Adverse Effect under clause (2) hereof: (a) any fact, condition, change, effect, event, occurrence or development arising out of or resulting from the execution of this Agreement, the disclosure (but, for the avoidance of doubt, not the consummation) or pendency of the Transactions, including by reason of the identity of Element (with respect to the Ardagh Business) or Ardagh (with respect to the Exal Business) as a party to this Agreement; (b) any change, effect, event, occurrence or development: (i) in the financial or securities markets (including interest rates, exchange rates and commodity prices) in general, or economic, regulatory or political conditions in general; (ii) generally affecting the industries in which the Ardagh Business or the Exal Business, as applicable, operates; or (iii) resulting from natural disasters, acts of God, war, sabotage or terrorism, or an escalation or worsening thereof; (c) any failure by the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable, to meet any internal or published projections, forecasts or revenue or earnings predictions (it being understood that this clause (c) shall not prevent or otherwise affect a determination that any event, circumstance, change or effect underlying such failure has resulted in, or contributed to, a Material Adverse Effect); (d) changes in Law or accounting standards or authoritative interpretations thereof; (e) any action expressly required to be taken pursuant to this Agreement; and (f) any action or inaction approved or consented to by Element (with respect to the Ardagh Purchased Entities) or by Ardagh (with respect to the Exal Purchased Entities); provided that in the case of the foregoing clauses (b) and (d), any such change, effect, event, occurrence or development may be taken into account to the extent it has a disproportionately adverse effect on the Ardagh Business (taken as a whole) or Exal Business (taken as a whole), as applicable, as compared to other participants in the industries and markets in which the Ardagh Business or Exal Business, as applicable, operates (in respect of the business conducted by them in such industries), but solely to the extent of such disproportionate effect.
“Multiemployer Plan” means a “multiemployer plan” within the meaning of Section 3(37) of ERISA and subject to ERISA.
11
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Mutual Services Agreement” means the agreement to be entered into by and between Ardagh and NewCo on substantially the terms set forth on Exhibit D.
“Neutral Accountant” means a United Kingdom office of KPMG LLP (or, if such firm shall decline or is unable to act, a United Kingdom office of Deloitte LLP, or, if such firm shall decline of is unable to act, a United Kingdom office of another independent accounting firm of international reputation reasonably acceptable to Ardagh and Element).
“NewCo Per Share Price” means [*].
“NewCo Shares” means ordinary shares of NewCo.
“Objection Deadline Date” means (a) in the case of the Initial Ardagh Closing Statement, the date that is forty-five (45) days after delivery of such Initial Closing Statement to Element and (b) in the case of the Initial Element Closing Statement, that date that is forty-five (45) days after delivery of such Initial Closing Statement to Ardagh.
“Out-of-Scope Employee” means any employee who is identified in Section 6.1(a)(i) of the Ardagh Disclosure Schedule (as such schedule may be updated by Ardagh prior to Closing in consultation with Element solely to remove those employees of the Ardagh Business that Ardagh and Element agree should be an Ardagh Business Employee).
“Owned Intellectual Property” means all Intellectual Property owned by any of the Ardagh Purchased Entities or the Exal Purchased Entities, as applicable.
“Owned Real Property” means real property in which an Ardagh Purchased Entity, or an Exal Purchased Entity, as applicable, has valid title in fee simple (or any equivalent interest), together with all buildings and other structures, facilities or improvements located thereon, all fixtures, systems, equipment and items of personal property of such party attached or appurtenant thereto and all easements, licenses, rights and appurtenances relating to the foregoing.
“Permit” means any permit, approval, consent, license, franchise, registration, certificate, or similar authorization, from any Governmental Authority.
“Permitted Encumbrances” means any (a) Encumbrances for Taxes, assessments or other Governmental Authority charges or levies that are (i) not yet due and payable, (ii) due but not delinquent or (iii) that are being contested in good faith by appropriate proceedings and for which adequate reserves have been maintained in accordance with GAAP or IFRS, as applicable, (b) statutory Encumbrances of landlords, carriers, warehousemen, mechanics, materialmen and repairmen for amounts not yet due or due but not delinquent or being contested in good faith by appropriate proceedings, (c) Encumbrances incurred or deposits made to a Governmental Authority in connection with a Permit, (d) Encumbrances incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other types of social security, (e) imperfections of title and other recorded or unrecorded Encumbrances, in each case, that do not, individually or in the aggregate, (1) interfere with the present use of or occupancy of the affected real property in any material respect or (2) impair in any material respect the ability of such parcel to be mortgaged or sold, leased or subleased for its present use,
12
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
(f) Encumbrances not created by Ardagh, Element or any of their respective Affiliates that affect the underlying fee interest of any Leased Real Property, (g) rights of a lessor under an operating lease or capitalized lease or of any licensor under a license, in each case, entered into in the ordinary course of business, (h) all non-exclusive licenses and covenants not to assert granted in the ordinary course of business with respect to Intellectual Property, (i) zoning, building, subdivision, land use, environmental regulations and other similar restrictions or requirements, in each case, that do not, individually or in the aggregate, (1) interfere with the present use of or occupancy of the affected real property in any material respect or (2) impair in any material respect the ability of such parcel to be mortgaged or sold, leased or subleased for its present use, (j) Encumbrances resulting from any facts or circumstances caused by Element or its Affiliates (with respect to the Ardagh Purchased Entities) or Ardagh or its Affiliates (with respect to the Exal Purchased Entities), and (k) Encumbrances resulting from the Debt Financing.
“Person” means any individual, corporation, partnership, company, partnership (exempt, general or limited), limited liability company, association, trust, joint venture or other entity or organization or any Governmental Authority.
“Personal Information” means, in addition to any definition for any similar term (e.g., “personally identifiable information” or “PII”) provided by applicable Law, or by Ardagh or any of the Ardagh Purchased Entities, or by Element or any of the Exal Purchased Entities, as applicable, in any of its privacy policies or notices, contracts or other public-facing statements, all information, in any form, regarding identifying an individual person or device, including (a) information that identifies, could be used to identify or is otherwise identifiable with an individual or a device, including name, physical address, telephone number, email address, financial information, financial account number or government-issued identifier, (b) any data regarding an individual’s activities online or on a mobile device or other application, whether or not such information is associated with an identifiable individual, and (c) Internet Protocol addresses, device identifiers or other persistent identifiers. Personal Information may relate to any individual, including a current, prospective, or former customer or employee of any Person, and includes information in any form or media, whether paper, electronic, or otherwise.
“Plan” means any “employee benefit plan” (within the meaning of Section 3(3) of ERISA, whether or not subject to ERISA), and any other employment, bonus, compensation, equity-based arrangement, stock purchase, deferred compensation, medical or life insurance, severance, pension, retirement plan, retiree medical or life insurance, old-age part-time (Altersteilzeit), employee assistance, fringe benefit and any other employee benefit program, agreement, policy or arrangement but excluding any plan, program or arrangement sponsored by a Governmental Authority.
“Post-Closing Tax Period” means any taxable period beginning after the Closing Date, and, in the case of any taxable period that includes, but does not begin on, the day after the Closing Date, the portion of such taxable period which begins the day after the Closing Date.
“Pre-Closing Tax Period” means any taxable period ending on or prior to the Closing Date, and, in the case of any taxable period beginning on or prior to and ending after the Closing Date, the portion of such taxable period which ends on the Closing Date.
13
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Privacy Laws” means any and all applicable Laws and legal requirements relating to privacy, data security, and Personal Information, and similar applicable consumer protection laws, including with respect to the receipt, collection, compilation, use, storage, processing, sharing, safeguarding, security, disposal, destruction, disclosure or transfer (including cross-border) of Personal Information, including the U.S. Federal Trade Commission Act, U.S. Payment Card Industry Data Security Standard, U.S. Controlling the Assault of Non-Solicited Pornography and Marketing Act, U.S. Telephone Consumer Protection Act, General Data Protection Regulation, Regulation 2016/679/EU on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (GDPR), and any and all applicable Laws governing breach notification in connection with Personal Information.
“Registered” means issued by, registered, recorded or filed with, renewed by or the subject of a pending application before any Governmental Authority or Internet domain name registrar.
“Regulatory Approvals” means the filings, consents, clearances or other approvals or permissions of Governmental Authorities required for the consummation of the Transactions for the jurisdictions that are set forth on Schedule 7.1(b).
“Related Agreements” means the Shareholders Agreement, the Mutual Services Agreement, the IP Cross-License Agreement and any Local Acquisition Agreement(s), including in each case, the schedules and exhibits thereto.
“Release” means any release, spill, emission, discharge, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into or through the environment of any Hazardous Materials.
“Representatives” means, with respect to any Person, such Person’s Affiliates and professional advisors and its and their respective directors, officers, members, managers, partners, employees and agents.
“Shareholders Agreement” means the agreement to be entered into among the Parties in substantially the form attached hereto as Exhibit C.
“Specified Dutch Entities” means Ardagh Metal Packaging Netherlands B.V. and Ardagh Aluminium Packaging Netherlands B.V.
“Specified French Entities” means Ardagh Group France S.A.S., Ardagh MP Group France S.A., Ardagh MP West France S.A.S., Ardagh Aluminium Packaging France S.A.S. and Ardagh Metal Packaging France S.A.S.
“Subsidiary” of any Person means another Person, of which at least a majority of the outstanding securities or ownership interests having, by their terms, ordinary voting power to elect a majority of the board of directors or other persons performing similar functions is owned or controlled directly or indirectly by such first Person or by one or more of its Subsidiaries.
14
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
“Target Closing Working Capital Amount” means (a) with respect to the Ardagh Purchased Entities, [*] and (b) with respect to the Exal Purchased Entities, [*].
“Tax” or “Taxes” means any and all taxes, charges, fees, levies or other assessments imposed by a Taxing Authority (whether national, state, provincial or local), including income, excise, franchise, real or personal property, sales, transfer, gains, gross receipts, occupation, privilege, payroll, wage, unemployment, workers’ compensation, Social Security, Medicare, use, value-added, capital, license, severance, stamp, recording, documentary, premium, windfall profits, environmental, capital stock, profits, withholding, registration, customs duties, employment, alternative or add-on minimum, estimated, escheat or other taxes of any kind whatsoever (whether disputed or not), including any related charges, fees, interest, penalties, additions to tax or other assessments imposed by the Taxing Authority.
“Tax Returns” means any return, declaration, report or form, claim for refund, information return or other statement (including estimated returns and withholding returns) filed or required to be filed with any Governmental Authority with respect to Taxes, including any schedules or attachments thereto and any amendments thereof.
“Taxing Authority” means any Governmental Authority that is responsible for the administration or imposition of any Tax.
“U.S. Code” means the U.S. Internal Revenue Code of 1986, as amended.
“U.S. Treasury Regulations” means the regulations promulgated under the U.S. Code, by the United States Department of the Treasury, as such regulations may be amended from time to time.
“Unresolved Objections” means the objections set forth on any Notice of Disagreement delivered pursuant to Section 2.9(a) that remain unresolved following discussions pursuant to Section 2.9(e)(i).
Accrued Benefits |
Section 6.2(e)(i) |
AGG |
Section 5.12(a)(i) |
AGMP |
Section 5.12(a)(i) |
Agreed Court |
Section 10.4(b) |
Agreement |
Preamble |
Ardagh |
Preamble |
Ardagh Actuary |
Section 6.2(e)(iii) |
Ardagh Additional Adjustment Amount |
Section 2.2(a)(i) |
Ardagh Business |
Recitals |
Ardagh Cash Consideration |
Section 2.2(a)(ii) |
Ardagh Estimated Closing Statement |
Section 2.4(a) |
Ardagh Existing Stock |
Section 5.10(a) |
Ardagh Hedging Arrangements |
Section 5.14(a) |
15
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Ardagh Initial Adjustment |
Section 2.2(a)(ii) |
Ardagh Insurance Policies |
Section 3.18 |
Ardagh Leases |
Section 3.13(b) |
Ardagh Licensed Intellectual Property |
Section 3.12(b) |
Ardagh Marks |
Section 5.10(a) |
Ardagh Material Contracts |
Section 3.17(a) |
Ardagh NewCo Shares |
Section 2.2(a)(i) |
Ardagh Owned Intellectual Property |
Section 3.12(b) |
Ardagh Purchased Entities |
Recitals |
Ardagh Terminable Breach |
Section 9.1(d) |
Ardagh U.S. DB Plan |
Section 6.2(e) |
Balance Sheet Date |
Section 3.6 |
Closing |
Section 2.5(a) |
Closing Date |
Section 2.5(a) |
Closing Statement Methodologies |
Section 2.9(a) |
Delayed Transfer Asset |
Section 5.18(b) |
Dispute |
Section 10.5(a) |
Dispute Notice |
Section 10.5(b) |
Disputed Items |
Section 2.9(d) |
Dutch Acceptance Notice |
Section 2.8(c) |
Dutch Offer |
Section 2.8(c) |
Dutch Offer Letter |
Section 2.8(c) |
Dutch Shares |
Recitals |
Element |
Preamble |
Element Estimated Closing Statement |
Section 2.4(b) |
Element Initial Adjustment |
Section 2.2(b) |
Element Insurance Policies |
Section 4.19 |
Element NewCo Shares |
Section 2.2(b) |
Element Note |
Section 2.2(b) |
Element Owed Amount |
Section 2.2(b) |
Element Parent Plans |
Section 6.2(a)(ii) |
Element Prorated Bonuses |
Section 6.2(c)(i) |
Element Terminable Breach |
Section 9.1(c) |
Enforceability Exceptions |
Section 3.1(b) |
Estimated Ardagh Closing Cash |
Section 2.4(a) |
Estimated Ardagh Closing Indebtedness |
Section 2.4(a) |
Estimated Ardagh Closing Working Capital Amount |
Section 2.4(a) |
Estimated Exal Closing Cash |
Section 2.4(b) |
Estimated Exal Closing Indebtedness |
Section 2.4(b) |
Estimated Exal Closing Working Capital Amount |
Section 2.4(b) |
EU Regulatory Investigation |
Section 5.15(a) |
Exal Business |
Recitals |
Exal Financial Statements |
Section 4.6(a) |
Exal Interim Financial Statements |
Section 4.6(c) |
Exal Key Customer |
Section 4.18(a)(ii) |
Exal Key Supplier |
Section 4.18(a)(i) |
16
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Exal Leases |
Section 4.14(b) |
Exal Licensed Intellectual Property |
Section 4.13(b) |
Exal Material Contracts |
Section 4.18(a) |
Exal Owned Intellectual Property |
Section 4.13(b) |
Exal Purchased Entities |
Recitals |
Excluded Compensation Payments |
Section 6.2(c)(i) |
Excluded Guarantees |
Section 5.11(b) |
Expense Cap |
Section 2.3 |
French Acceptance Notice |
Section 2.8(b) |
French Offer |
Section 2.8(b) |
French Offer Letter |
Section 2.8(b) |
French Shares |
Recitals |
German GAAP |
Section 5.12(a)(iv) |
Freshfields |
Section 5.15(c) |
ICC Rules |
Section 10.5(c) |
Indemnity Payment |
Section 5.15(l) |
Initial Ardagh Closing Statement |
Section 2.9(b) |
Initial Element Closing Statement |
Section 2.9(b) |
Initial Settlement |
Section 5.12(b)(iii) |
Insurance Proceeds |
Section 5.15(l) |
Insured Party |
Section 5.9(e)(i) |
Issuers |
Section 1.1 |
Key Customer |
Section 3.17(a)(ii) |
Key Supplier |
Section 3.17(a)(i) |
Legacy Organizational Documents |
Section 5.9(e)(i) |
Local Acquisition Agreements |
Section 2.7 |
Local Transfer Documents |
Section 2.6(a)(v) |
Loss Compensation Receivables |
Section 5.12(a)(v)(A) |
Management Liability Policies |
Section 5.9(e)(ii) |
National Regulatory Investigation |
Section 5.15(a) |
NewCo |
Preamble |
NewCo Actuary |
Section 6.2(e)(iii) |
NewCo Certification Date |
Section 6.2(e)(iii) |
NewCo Plans |
Section 6.4(b) |
NewCo UK DB Plan |
Section 6.2(d) |
NewCo U.S. DB Plan |
Section 6.2(e)(i) |
Notice of Acceptance |
Section 2.9(d) |
Notice of Disagreement |
Section 2.9(d) |
Party or Parties |
Preamble |
PBGC |
Section 3.14(g) |
PLTA |
Section 5.12(a)(i) |
PLTA Difference |
Section 5.12(b)(iii) |
PLTA Period 2019 |
Section 5.12(a)(iv) |
PLTA Termination Accounts |
Section 5.12(a)(iv) |
Pre-Closing Dispute |
Section 10.4(a) |
Profit Transfer Payables |
Section 5.12(a)(v)(A) |
17
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
R&W Costs |
Section 8.2 |
R&W Insurance Policy |
Section 8.2 |
Reference Assets Amount |
Section 6.2(e)(ii) |
Regulatory Investigations |
Section 5.15(a) |
Registrar |
Section 1.1 |
Relevant Fiscal Year |
Section 5.12(b)(i) |
Relevant PLTA Amendments |
Section 5.12(b)(ii) |
Review Period |
Section 6.2(e)(iii) |
Rule 144A/Reg S Offering |
Section 5.7(a) |
Sample Closing Statement |
Section 2.9(a) |
Termination Date |
Section 9.1(b) |
Third Party Claim |
Section 5.15(a) |
Transactions |
Section 2.5(a) |
Transferred Ardagh Business Employees |
Section 6.1(b) |
Transferred Assets |
Section 6.2(e)(ii) |
Transferred Business Employees |
Section 6.1(c) |
Transferred Guarantees |
Section 5.11(a) |
U.S. DB Funding True-Up |
Section 6.2(e)(ii) |
U.S. DB Transfer Date |
Section 6.2(e)(ii) |
U.S. Pension Plan |
Section 3.14(f) |
18
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
following Business Day. The words “made available,” “provided” or “delivered” to a Party, or similar formulations, means that such materials were available to such Party in the electronic data room hosted by the providing Party in connection with the Transactions no later than one (1) Business Day prior to the date hereof, or were provided by electronic transmission directly to a Party’s legal counsel or financial advisor prior to such time. |
19
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
than those imposed by applicable securities Laws), and NewCo shall acquire and accept, and shall cause its designated Subsidiaries to acquire and accept, as applicable, from Element or such Subsidiaries, all of their respective right, title and interest as of the Closing in, to and under the Exal Equity Interests. |
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(a) In exchange for the Ardagh Equity Interests transferred by Ardagh or its Subsidiaries, NewCo shall, at the Closing: |
20
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
pursuant to the preceding proviso shall not result in an Estimated Closing Working Capital Shortfall of the Ardagh Purchased Entities; and |
21
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
or the fifth (5th) anniversary of the Closing Date) for such Element Note customary for similar instruments or otherwise reasonably acceptable to Ardagh and Element acting in good faith. Until the Element Note has been repaid in full, all dividends and distributions to which Element would otherwise be entitled as a shareholder of NewCo shall be applied to pay the Element Note. |
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(c) When calculating the adjustments contemplated by Section 2.2(a) and 2.2(b), the adjustment contemplated by Section 2.2(a) shall be calculated after giving effect to the adjustment contemplated by Section 2.2(b). |
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(d) In connection with the Closing, NewCo shall cause the Existing Exal Indebtedness to be repaid in full in accordance with its terms with the proceeds from the Debt Financing. |
22
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
23
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions), or at such other place or at such other time or on such other date as the Parties may mutually agree upon in writing (the day on which the Closing takes place being the “Closing Date”). |
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(a) Closing Deliveries by Ardagh. At the Closing, Ardagh shall authorize, execute and/or deliver to Element or NewCo, as the case may be: |
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(i) a duly executed counterpart to each of the Related Agreements to which Ardagh or any of its Affiliates is to be a party; |
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(ii) a certificate, duly executed by an authorized officer of Ardagh, certifying as to (A) the fulfillment of the conditions set forth in Section 7.2(a) and Section 7.2(b) and (B) the termination by Ardagh or its Affiliates of all material intercompany arrangements (other than the Ardagh Hedging Arrangements) effective as of the Closing, in accordance with Section 5.8(a)(i); |
24
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
form that is consistent with the terms and conditions of this Agreement) (collectively, the “Local Transfer Documents”), in such form as the Parties mutually agree is necessary or appropriate to effect the transfer of the Ardagh Equity Interests to NewCo or its designated Subsidiary in such jurisdiction, free and clear of all Encumbrances (other than Encumbrances arising under securities Laws or the Shareholders Agreement), duly executed by Ardagh and/or its applicable Affiliates; |
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(vii) such documentation provided by Ardagh to the trustee or agent, as the case may be, required under the instruments described in clauses (i) through (vii) of the definition of Ardagh Existing Indebtedness, evidencing that the consummation of the Transactions on the Closing Date complies with the terms of such instruments. |
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(b) Closing Deliveries by Element. At the Closing, Element shall authorize, execute and/or deliver to Ardagh or NewCo, as the case may be: |
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(i) a duly executed counterpart to each of the Related Agreements to which Element or any of its Affiliates is to be a party; |
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(v) such other customary instruments of transfer, assumptions, filings or documents, in form and substance reasonably satisfactory to Ardagh or NewCo, as the case may be, required to give effect to this Agreement. |
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(c) Closing Deliveries by NewCo. At the Closing, NewCo shall authorize, execute and/or deliver to Ardagh or Element, as the case may be: |
25
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(ii) a certificate evidencing the Ardagh NewCo Shares to be issued to Ardagh in accordance with Section 2.2(a), registered in the name of Ardagh or its designated Affiliate; |
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(iii) a certificate evidencing the Element NewCo Shares to be issued to NewCo in accordance with Section 2.2(b), registered in the name of Element or its designated Affiliate; |
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(v) a duly executed counterpart to each of the Local Transfer Documents to which NewCo and/or any of its Subsidiaries is a party; and |
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(vi) such other customary instruments of transfer, assumptions, filings or documents, in form and substance reasonably satisfactory to Ardagh and Element required to give effect to this Agreement. |
26
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
have the provisions of this Agreement apply to such French Shares following completion of the employee consultation process described in the French Offer Letter. Subject to acceptance of the French Offer by Ardagh following completion of the employee consultation process and upon delivery to NewCo of the executed acceptance notice attached as Schedule 2 to the French Offer Letter (the “French Acceptance Notice”), this Agreement shall apply to the French Shares and, the Specified French Entities shall be included in the Ardagh Purchased Entities. |
27
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Transactions that are appropriate, in accordance with the terms and conditions set forth in the French Offer Letter and/or the Dutch Offer Letter, as applicable. |
28
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
29
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(ii) Any resolution agreed to in writing by Ardagh and Element as to any such Disputed Items pursuant to Section 2.9(e)(i) shall be final and binding upon the Parties. |
30
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(vii) The fees and disbursements of the Neutral Accountant with respect to a Notice of Disagreement delivered by Element shall be allocated between Element, on the one hand, and Ardagh, on the other hand, in proportion to the aggregate amount of Unresolved Objections so submitted to the Neutral Accountant that are unsuccessfully disputed by Element (as finally determined by the Neutral Accountant) bears to the total amount of the Unresolved Objections so submitted, as determined by the Neutral Accountant in its final determination. |
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(viii) In acting under this Agreement, the Parties agree that the Neutral Accountant shall be acting as an expert and not an arbitrator, provided that the Neutral Accountant shall be entitled to the immunities of an arbitrator. |
31
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
32
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Except as set forth in the Ardagh Disclosure Schedule (subject to the limitations set forth in Section 1.3(b)), Ardagh represents and warrants to Element and NewCo, as of the date hereof and as of the Closing Date, as follows:
33
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
(or any of the stockholders or other equityholders of Ardagh) is necessary to authorize this Agreement and the Related Agreements to which Ardagh (or such Ardagh Seller) is a party or the consummation of the transactions contemplated hereby and thereby. This Agreement has been, and upon their execution and delivery each of the Related Agreements to which Ardagh or any of its Affiliates is a party shall have been, duly executed and delivered by it, and (assuming due authorization, execution and delivery by the other parties thereto) this Agreement constitutes, and upon their execution the Related Agreements to which Ardagh or such Affiliate is a party shall constitute, the legal, valid and binding obligations of Ardagh (or such Affiliate, as applicable), enforceable against it in accordance with their respective terms, except as the enforceability hereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally or applicable equitable principles (whether considered in a proceeding at law or in equity) (the “Enforceability Exceptions”). |
34
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
other Related Agreements by the Ardagh Affiliates party thereto), and the consummation of the transactions contemplated hereby and thereby by Ardagh and its Affiliates, do not and shall not (a) violate, conflict with or result in the breach of any provision of the charter, bylaws or similar organizational or governing documents of Ardagh, any Ardagh Seller or any of the Ardagh Purchased Entities; (b) assuming that all Regulatory Approvals have been obtained, contravene, conflict with or violate any Law or Governmental Order applicable to Ardagh or any of the Ardagh Purchased Entities or by which Ardagh or any of the assets or properties of the Ardagh Business is bound or subject; or (c) violate, conflict with, result in any breach of, constitute a default (or an event which, with or without the giving of notice or lapse of time, or both, would become a default) under, or result in the loss of any right or benefit under, or result in the creation or imposition of any Encumbrance (other than a Permitted Encumbrance) on, require any consent, approval or waiver under, or give to others any rights of termination, amendment, acceleration or cancellation of, any Ardagh Material Contract or Permit, except in the case of clauses (b) and (c) (other than, in the case of clause (c), as such clause relates to the Ardagh Existing Indebtedness) for any such breaches, defaults, rights or Encumbrances as would not, individually or in the aggregate, reasonably be expected to be material to the Ardagh Business, taken as a whole, or prevent or materially impair or delay the ability of Ardagh or any Ardagh Seller to consummate the Transactions. |
|
(a) True and complete copies of the Ardagh Combined Financial Statements have been made available to Element by Ardagh. |
35
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
not have any Liabilities that would be required to be reflected or reserved against in a combined balance sheet of the Ardagh Purchased Entities prepared in accordance with IFRS, except, in each case, those which would not, individually or in the aggregate, reasonably be expected to be material to the Ardagh Business. |
36
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
not reasonably be expected to be, individually or in the aggregate, material to the Ardagh Business (taken as a whole). As of the date of this Agreement, no Action is pending or, to the Knowledge of Ardagh, threatened, seeking the revocation or cancellation of any such Permit relating to the Ardagh Business. |
37
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
remediation pursuant to Environmental Laws or which would reasonably be expected to result in any Ardagh Purchased Entity incurring Liabilities. |
38
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
otherwise exploit (as the case may be) all Intellectual Property licensed to it pursuant to the Business IP Agreements (subject to the terms thereof) (“Ardagh Licensed Intellectual Property”), in each case, free and clear of all exclusive licenses and Encumbrances (other than Permitted Encumbrances), except as would not reasonably be expected to be, individually or in the aggregate, material to the Ardagh Business (taken as a whole). The Ardagh Owned Intellectual Property and the Ardagh Licensed Intellectual Property, taken together with the rights granted pursuant to the IP Cross License Agreement, the Mutual Services Agreement and Section 5.10 of this Agreement (in each case, subject to the terms thereof), constitute all of the Intellectual Property necessary and sufficient for the conduct and operation of the Ardagh Business; provided, however, that this sentence shall not be construed to mean the Ardagh Business does not infringe, misappropriate or violate the Intellectual Property of any other Person, which is solely the subject of Section 3.12(e) (first sentence). |
|
(c) At Closing, neither Ardagh nor any of its Subsidiaries will own any Intellectual Property relating to aluminum bottles other than Intellectual Property that is licensed to NewCo pursuant to the IP Cross License Agreement. |
39
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Intellectual Property, except as would not reasonably be expected to be, individually or in the aggregate, material to the Ardagh Business (taken as a whole). |
40
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
held for use primarily in the Ardagh Business and which are necessary for its continued operation as currently conducted. |
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(e) All improvements and fixtures, and building equipment and machinery having an individual book value of at least $150,000 located on the Owned Real Property, and all improvements and fixtures, and building equipment and machinery having an individual book value of at least $150,000 owned by the Ardagh Purchased Entities located on the Leased Real Property, if any, are in good working order and repair (subject to ordinary wear and tear), and except for any defects that would not impair the use of such improvements, fixtures, building equipment or machinery. |
41
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
claims for benefits, and, to the Knowledge of Ardagh, as of the date hereof, no fact or event exists that could give rise to any such material Action, investigation or audit. |
42
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
43
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Body is not required for Ardagh to enter into this Agreement or to consummate the Transactions. There has been no strike, slowdown, work stoppage, lockout or material labor dispute, or other material collective bargaining dispute since December 31, 2016, with respect to the Ardagh Business or the Ardagh Business Employees. All Collective Bargaining Agreements to which the Ardagh Purchased Entities or, solely with respect to any Ardagh Business Employee, Ardagh or any of its Affiliates other than the Ardagh Purchased Entities is a party are in full force and effect, and neither the execution and delivery of this Agreement and the Related Agreements, nor the consummation of the transactions contemplated by this Agreement and the Related Agreements, shall constitute a termination event thereunder. |
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(d) All Ardagh Business Employees listed on Section 6.1(a)(ii) of the Ardagh Disclosure Schedule are wholly or primarily assigned to the Ardagh Business. No Out-of-Scope Employee is wholly assigned to the Ardagh Business. |
44
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(e) There are no Tax liens on any assets of the Ardagh Purchased Entities or the Ardagh Business (other than Permitted Encumbrances). |
45
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
(n) None of the Ardagh Purchased Entities has elected the installment method for the payment of Taxes incurred pursuant to Section 965 of the U.S. Code. |
|
(o) The (i) PLTA between AGMP, as subsidiary, and AGG, as parent, and (ii) the profit and loss transfer agreement (Gewinnabführungsvertrag) between AGMP and AMPG |
46
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
dated June 24, 2011 satisfy the requirements for Tax consolidation under German Law, including the requirement that the underlying profit and loss pooling agreement is legally valid and binding and has been performed during its term (Durchführung der Verträge). |
47
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(viii) any Contract under which the Ardagh Business or any Ardagh Purchased Entity has continuing material indemnification obligations to any Person, or under which any Ardagh Purchased Entity has, or is required to, assume or guarantee any material Liability of any Person; |
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(ix) any Contract (A) relating to the acquisition or disposition of any business (whether by merger, sale of stock or assets, or otherwise), under which the Ardagh Business or any Ardagh Purchased Entity has any material obligation with respect to any “earn-out,” deferred or contingent purchase price or other similar contingent obligations or (B) imposing material obligations on any Ardagh Purchased Entity under any conditional sale or title retention provisions; |
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(x) any Contract relating to the acquisition or disposition of any business (whether by merger, sale of stock or other equity interests, sale of assets or otherwise) or any material assets or real property, in each case, other than acquisitions or dispositions of equipment, materials, supplies, inventory or products in the ordinary course of business consistent with past practice and other than any Contract pursuant to which no party thereto has any outstanding obligation on the date hereof; |
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(xi) all Contracts that contain exclusivity obligations that are material to the Ardagh Business, that restrict the ability of the Ardagh Purchased Entities to conduct their business in any material respect or that limit, or purport to limit, in any material respect the ability of the Ardagh Purchased Entities or the Ardagh Business to compete or do business with any Person or in any geographic area (other than any Contract required to be disclosed pursuant to clauses (i) or (ii) above); |
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(xii) any Contract containing any “most favored nation” (or equivalent pricing provision) in favor of any third party (other than any Contract required to be disclosed pursuant to clauses (i) or (ii) above); and |
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(xiii) any Contract or arrangement providing for the securitization of any receivables related to the Ardagh Business. |
48
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
not committed any material breach or default thereunder and, to the Knowledge of Ardagh, the counterparties thereto have not committed any material breach of, and are not in default under, any Ardagh Material Contract, and no event has occurred that, with notice or lapse of time or both, would constitute such a material breach, violation or default by any of the Ardagh Purchased Entities, or, to the Knowledge of Ardagh, the counterparties thereto. Ardagh has made available to Element true, correct and complete copies of each written Ardagh Material Contract (including all material amendments, supplements and modifications thereto as are in effect as of the date hereof). |
49
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(c) No director or officer, or to the Knowledge of Ardagh, employee of Ardagh or any of its Affiliates, or any member of such Person’s immediate family, (i) owes any significant amounts to, or is owed any significant amounts by the Ardagh Business, (ii) has any material claim or cause of action against any of the Ardagh Purchased Entities or the Ardagh Business, or (iii) owns any material property or right, tangible or intangible (including Intellectual Property), that is used or held for use in connection with or that relates to the Ardagh Business. |
50
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Except as set forth in the Element Disclosure Schedule (subject to the limitations set forth in Section 1.3(b)), Element represents and warrants to Ardagh and NewCo, as of the date hereof and as of the Closing Date, as follows:
51
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
it, and (assuming due authorization, execution and delivery by the other parties thereto) this Agreement constitutes, and upon their execution the Related Agreements to which Element or such Affiliate is a party shall constitute, the legal, valid and binding obligations of Element (or such Affiliate, as applicable), enforceable against it in accordance with their respective terms, except as the enforceability hereof may be limited by the Enforceability Exceptions. |
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(c) No 30% Rule Designee (as such term is defined in the Shareholders Agreement) has any economic rights or voting rights in any Exal Purchased Entity, other than (i) as set forth in the organizational documents of such Exal Purchased Entity and any voting agreement, shareholders agreement or similar agreement related thereto, in each case, as made available to Ardagh prior to the date hereof, and (ii) the right of such designees to receive an amount (not to exceed CAD$10,000 in the aggregate) per year, together with any gross-up thereon for applicable withholding Taxes. |
52
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
53
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
thereof and for the respective periods indicated therein; and (iii) were prepared in accordance with GAAP. |
54
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
55
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Purchased Entities; all such Environmental Permits are in full force and effect, and neither Element nor any of its Affiliates have received any written notice from any Governmental Authority relating to the revocation, termination or modification of any such Environmental Permit; (iii) there are no Actions against Exal or any of its Affiliates, including any Exal Purchased Entity, relating to the Exal Business, the Owned Real Property or Leased Real Property of the Exal Purchased Entities or the Exal Purchased Entities pursuant to any Environmental Law pending or, to the Knowledge of Element, threatened in writing; and (iv) there has been no Release of any Hazardous Materials (A) at, in, on or under any Owned Real Property of the Exal Purchased Entities, (B) by any Exal Purchased Entity or, to the Knowledge of Element, by any other Person, at, in, on or under any of the Leased Real Property of the Exal Purchased Entities, or (C) during the period of their ownership or operation thereof, at, in, on or under any facilities formerly owned or operated by the Exal Purchased Entities, or at, in, on or under any third-party sites where the Exal Purchased Entities are or have been alleged in writing to have Liabilities, in the case of (A), (B) and (C), in a condition that requires investigation or remediation pursuant to Environmental Laws or which would reasonably be expected to result in any Exal Purchased Entity incurring Liabilities. |
56
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
use thereof, except as would not reasonably be expected to be, individually or in the aggregate, material to the Exal Business (taken as a whole). |
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(c) The only Intellectual Property relating to aluminum bottles owned by Element or any of its Subsidiaries is owned, directly or indirectly, by the Exal Purchased Entities. |
57
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
writing, against Element or any of the Exal Purchased Entities alleging that the Exal Business or any of the Exal Owned Intellectual Property or Exal Purchased Entities infringes, misappropriates or otherwise violates the Intellectual Property rights of any other Person or challenging any of the Exal Purchased Entities’ rights in or to any of its Intellectual Property; provided that any Action that has been initiated but with respect to which process or other comparable notice has not been served on or delivered to Element or an Exal Purchased Entity shall be deemed to be “threatened” rather than “pending”. To the Knowledge of Element, as of the date hereof, no Person is engaging or has since December 31, 2016 been engaging in any activity that infringes, misappropriates or otherwise violates, any of the Exal Owned Intellectual Property, except as would not reasonably be expected to be, individually or in the aggregate, material to the Exal Business (taken as a whole). |
58
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
real property to which it is a party as of the date hereof, including all amendments, modifications, extensions and guaranties thereto relating to Leased Real Property of the Exal Purchased Entities (the “Exal Leases”). There has not been any sublease, assignment or any other transfer of rights entered into by Element in respect of the Exal Leases. |
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(e) All improvements and fixtures, and building equipment and machinery having an individual book value of at least $150,000 located on the Owned Real Property, and all improvements and fixtures, and building equipment and machinery having an individual book value of at least $150,000 owned by the Exal Purchased Entities located on the Leased Real Property, if any, are in good working order and repair (subject to ordinary wear and tear), and except for any defects that would not impair the use of such improvements, fixtures, building equipment or machinery. |
59
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
of Element, threatened, by any party, including any Governmental Authority, relating to any Element Plan, other than routine claims for benefits, and, to the Knowledge of Element, as of the date hereof, no fact or event exists that could give rise to any such material Action, investigation or audit. |
60
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
any assessments or demands for payment of withdrawal liability and (3) any audits or third party analyses with respect to the status of or withdrawal liability. |
61
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
the transactions contemplated by this Agreement and the Related Agreements, shall constitute a termination event thereunder. |
62
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(e) There are no Tax liens on any assets of the Exal Purchased Entities or the Exal Business (other than Permitted Encumbrances). |
63
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the U.S. Code) in conjunction with the Transactions. |
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(n) None of the Exal Purchased Entities has elected the installment method for the payment of Taxes incurred pursuant to Section 965 of the U.S. Code. |
64
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(iii) all Contracts (including any mortgages, deeds of trusts, indentures, guarantees, loans or credit agreements and security agreements) relating to existing Indebtedness in excess [*], other than, in each case, (i) Permitted Encumbrances, (ii) intercompany Indebtedness and (iii) the Exal Existing Indebtedness; |
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(v) all material Business IP Agreements of the Exal Purchased Entities; |
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(vi) the material Exal Leases; |
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(vii) any Contract under which there has been an advance or loan to or guarantee in respect of any other Person which amount is in excess [*] in the aggregate, other than the Exal Existing Indebtedness; |
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(viii) any Contract under which the Exal Business or any Exal Purchased Entity has continuing material indemnification obligations to any Person, or under which any Exal Purchased Entity has, or is required to, assume or guarantee any material Liability of any Person; |
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(ix) any Contract (A) relating to the acquisition or disposition of any business (whether by merger, sale of stock or assets, or otherwise), under which the Exal Business or any Exal Purchased Entity has any material obligation with respect to any “earn-out,” deferred or contingent purchase price or other similar contingent obligations or (B) imposing material obligations on any Exal Purchased Entity under any conditional sale or title retention provisions; |
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(x) any Contract relating to the acquisition or disposition of any business (whether by merger, sale of stock or other equity interests, sale of assets or otherwise) or any material assets or real property, in each case, other than acquisitions or dispositions of equipment, materials, supplies, inventory or products in the ordinary course of business consistent with past practice and other than any Contract pursuant to which no party thereto has any outstanding obligation on the date hereof; |
65
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(xi) all Contracts that contain exclusivity obligations that are material to the Exal Business, restrict the ability of the Exal Purchased Entities to conduct their business in any material respect or that limit, or purport to limit, in any material respect the ability of the Exal Purchased Entities or the Exal Business to compete or do business with any Person or in any geographic area (other than any Contract required to be disclosed pursuant to clauses (i) or (ii) above); |
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(xii) any Contract containing any “most favored nation” (or equivalent pricing provision) in favor of any third party (other than any Contract required to be disclosed pursuant to clauses (i) or (ii) above); and |
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(xiii) any Contract or arrangement providing for the securitization of any receivables related to the Exal Business. |
66
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
in connection with normal renewals) of any such Element Insurance Policies, nor has Element or any of its Affiliates received any recommendation from any insurer that would require any material amount of capital expenditure in respect of the Exal Business in order to remediate. To the Knowledge of Element, no event has occurred, including the failure by Element or its Affiliates to give any notice or information, or Element or its Affiliates giving any inaccurate or erroneous notice or information, which limits or impairs the rights of Element or its Affiliates under any Element Insurance Policy. |
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(c) No director or officer, or to the Knowledge of Element, employee of Element or any of its Affiliates, or any member of such Person’s immediate family, (i) owes any significant amounts to, or is owed any significant amounts by the Exal Business, (ii) has any material claim or cause of action against any of the Ardagh Purchased Entities or the Exal |
67
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Business, or (iii) owns any material property or right, tangible or intangible (including Intellectual Property), that is used or held for use in connection with or that relates to the Exal Business. |
68
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(g) not amend or make any changes to the accounting policies applicable to any Ardagh Purchased Entity or otherwise relating to the Ardagh Business, unless required by GAAP, IFRS or applicable Law; |
69
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(l) not make any deferred payments of any accounts payable other than in the ordinary course of business consistent with past practice; |
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(m) not give any discount, accommodation or other concession to accelerate or induce the collection of any receivable other than in the ordinary course of business consistent with past practice; |
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(q) except for Out-of-Scope Employees, not transfer to Ardagh or any of its Affiliates (other than any Ardagh Purchased Entity) the employment of any person employed by an Ardagh Purchased Entity; |
70
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(t) other than policies that are replaced or renewed without any gaps in (and without any significant decrease in scope of) coverage, not voluntarily permit any Ardagh Insurance Policy to be canceled or terminated; |
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(u) not allow any of the Ardagh Purchased Entities to enter into any line of business that is unrelated to the Ardagh Business; |
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(w) not enter into an enforceable agreement, or otherwise agree or commit to do any of the foregoing. |
Nothing contained in this Agreement shall be construed to give to Element, NewCo or any of their respective Affiliates, directly or indirectly, rights to control or direct the operations of the Ardagh Business.
71
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(g) not amend or make any changes to the accounting policies applicable to any Exal Purchased Entity or otherwise relating to the Exal Business, unless required by GAAP, IFRS or applicable Law; |
72
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Entity, or permit any Encumbrances to be imposed on any such interests (other than any Encumbrance that will be released on or prior to the Closing); |
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(l) not make any deferred payments of any accounts payable other than in the ordinary course of business consistent with past practice; |
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(m) not give any discount, accommodation or other concession to accelerate or induce the collection of any receivable other than in the ordinary course of business consistent with past practice; |
73
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
on substantially similar terms or as required as a result of the Transactions or by Law (in each case, only after prior consultation with Ardagh to the extent permitted under applicable Law); |
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(q) not transfer to Element or any of its Affiliates (other than any Exal Purchased Entity) the employment of any person employed by an Exal Purchased Entity; |
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(u) not allow any of the Exal Purchased Entities to enter into any line of business that is unrelated to the Exal Business; |
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(w) not enter into an enforceable agreement, or otherwise agree or commit, to do any of the foregoing. |
Nothing contained in this Agreement shall be construed to give to Ardagh, NewCo or any of their respective Affiliates, directly or indirectly, rights to control or direct the operations of the Exal Business.
74
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
requirements of any Governmental Authority, securities exchange or other regulatory organization with whose rules Ardagh or Element is required to comply, each of Ardagh and Element shall provide to the other and their respective Representatives reasonable access during normal business hours to all books, records, information, documents, personnel, offices, facilities and properties which such Party may reasonably request relating to the Exal Business or the Ardagh Business, as applicable (including, for the avoidance of doubt, maintaining access to such Party’s electronic data room); provided that such access shall only be upon the written request of Ardagh or Element submitted reasonably in advance, shall not unreasonably disrupt personnel, operations and properties of the Exal Business or the Ardagh Business, as applicable, and shall be at the requesting Party’s sole risk and expense. In exercising its rights hereunder, the requesting Party shall conduct itself so as not to interfere unreasonably in the conduct of the Ardagh Business or the Exal Business, as applicable, prior to the Closing. For the avoidance of doubt, each of Ardagh and Element shall assist each other in obtaining any information necessary to obtain a R&W Insurance Policy (or other policy relating to liabilities of the other Party for the period prior to Closing), or facilitate obtaining insurance for NewCo (in each case, if applicable); provided, however, that such access shall not include authorization to take samples of building materials or subsurface samples of soil or groundwater. Each of Ardagh and Element acknowledge and agree that any contact or communication by it and its representatives with officers, employees or agents of the Ardagh Business or the Exal Business, as applicable, hereunder shall be arranged and supervised by representatives of such Party granting access, unless such granting Party otherwise expressly consents in writing with respect to any specific contact. Notwithstanding anything to the contrary set forth in this Agreement, neither Ardagh, Element nor any of their respective Affiliates shall be required to disclose to the other parties or any of their Representatives (i) any information (A) if doing so could violate any contract or Law to which the Party granting access or any of its Affiliates is a party or is subject or which it believes in good faith could result in a loss of the ability to successfully assert a claim of privilege (including attorney-client and work product privileges), (B) if the requesting Party or any of its Affiliates, on the one hand, and the Party from whom access has been requested or any of its Affiliates, on the other hand, are adverse parties in a litigation and such information is reasonably pertinent thereto, or (C) if the Party from whom access has been requested reasonably determines that such information is competitively sensitive (provided that in such case such information shall be made available pursuant to the Parties’ previously established “clean team” procedures, to the extent permissible and necessary for the valuation and assessment of the Ardagh Business or Exal Business (as the case may be)), or (ii) any other information relating to Taxes or Tax Returns other than information relating solely to the Ardagh Business or the Exal Business, as applicable. All information made available hereunder prior to the Closing, shall be subject to the Confidentiality Agreement, and each of Ardagh and Element shall not (and shall cause its respective Affiliates and Representatives not to) use any information obtained pursuant to this Section 5.3 or otherwise under this Agreement for any purpose unrelated to the Transactions. No investigation pursuant to this Section 5.3 shall affect any representation or warranty in this Agreement of either Ardagh, Element or any condition to the obligations of either Ardagh or Element. |
75
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
case of NewCo) or of the retained Ardagh business (in the case of Ardagh) with respect to periods or occurrences prior to or on the Closing Date (including customary period end adjustments made post-Closing to facilitate a hard close trial balance preparation at the Closing Date) as Ardagh or NewCo, as applicable, may reasonably request for its financial reporting and Tax reporting purposes or, in the case of NewCo, for the purposes of assessing, underwriting and otherwise procuring insurance for the combined business of NewCo. Unless otherwise consented to in writing by the applicable Party, for a period of seven (7) years following the Closing Date, or, in the case of Tax related records, the period in which the statute of limitations for any Pre-Closing Tax Period remains unexpired, if longer than seven (7) years, NewCo shall not destroy, alter or otherwise dispose of any books and records of any Ardagh Purchased Entity or Exal Purchased Entity, or any portions thereof, relating to periods prior to the Closing Date without first giving reasonable prior notice to Ardagh or Element, as applicable, and offering to surrender to Ardagh or Element, as applicable, such books and records or such portions thereof. |
76
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
be disclosed to employees, representatives, officers, or directors of the recipient without written consent of the party providing such materials. |
77
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
in connection with NewCo’s efforts to obtain the Debt Financing (provided that such requested cooperation does not unreasonably interfere with the ongoing operations of Element or Ardagh), including: (i) participation in meetings, offering memorandum drafting sessions, lender presentations, investor presentations and rating agency presentations and due diligence sessions and reasonably promptly furnishing NewCo and its Debt Financing Sources with the required information regarding the Ardagh Purchased Entities or the Exal Purchased Entities that is required to be delivered to the Debt Financing Sources pursuant to any definitive documentation entered into therewith, and other financial and pertinent information regarding the Ardagh Purchased Entities or the Exal Purchased Entities, as is customary for Debt Financing or may be reasonably required by the lenders, initial purchasers or investors and is customary for similar debt financings; (ii) assisting NewCo and its Debt Financing Sources in the preparation of (A) pro forma financial information and financial statements and other materials, including carve-out financial statements (and related audit and review reports) for any bank financing, bond offering memorandum and similar documents in connection with any of the Debt Financing (including customary (i) lender presentations and confidential information memoranda and customary authorization letters for distribution thereof; and (ii) offering documents for high yield offerings pursuant to Rule 144A and/or Regulation S under the U.S. Securities Act of 1933, as amended (a “Rule 144A/Reg S Offering”)) and (B) materials for rating agency presentations; (iii) facilitating customary due diligence and furnishing, or using reasonable efforts to cause third parties to furnish, to NewCo and the lenders, initial purchasers or investors or their advisers with due diligence materials prepared on behalf of Element and/or Ardagh (and their officers and employees) and other information reasonably required by any lender, initial purchaser or investor or its advisers in connection with their due diligence investigation of the Ardagh Purchased Entities and the Exal Purchased Entities, including the furnishing of customary certificates of officers or directors of Element and/or Ardagh; (iv) using commercially reasonable efforts to (A) obtain from Element’s and/or Ardagh’s auditors such accountants’ customary SAS-72 style comfort letters (with customary negative assurance) in the form and substance customary for a Rule 144A/Reg S Offering and reports as may be required to implement or obtain the Debt Financing, and the consent of such auditors to the use of their reports in any materials relating to the Debt Financing and (B) cause such accountants to cooperate with NewCo in connection with the Debt Financing, including reviewing and commenting on the offering memorandum and participating in drafting sessions; (v) using commercially reasonable efforts to obtain such consents, legal opinions, surveys and title insurance as may be required to implement or obtain the Debt Financing; (vi) facilitating, effective as of the Closing, the pledging of collateral and the repayment or defeasance of any Indebtedness (including obtaining payoff, redemption or similar notices, effective as of the Closing) and the release of related liens and termination of security interests (including obtaining the lien releases contemplated by Section 2.5(c) and Section 2.5(d)); (vii) taking reasonable actions necessary to (A) permit the lenders and prospective lenders involved in the Debt Financing to evaluate the current assets, cash management and accounting systems of the Ardagh Purchased Entities and the Exal Purchased Entities, and the policies and procedures relating thereto for the purposes of establishing collateral arrangements as of the Closing and to assist with other collateral audits and due diligence examinations reasonable and customary for debt financings and (B) establish bank and other accounts and blocked account agreements and lock-box arrangements to the extent necessary in connection with the Debt Financing; (viii) causing NewCo to provide at least three (3) Business Days prior to the anticipated Closing Date all documentation and other information regarding NewCo or its applicable |
78
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Subsidiaries as is required by applicable “know your customer” and anti-money laundering rules and regulations including the USA PATRIOT Act and requested by the lenders in writing ten (10) Business Days prior to the anticipated Closing Date; (ix) subject to the occurrence of the Closing and in each case effective as of the Closing, executing or causing NewCo to execute, customary definitive financing documents, as may be required to implement or obtain the Debt Financing (including a certificate of the chief financial officer of NewCo with respect to solvency matters); (x) assisting NewCo to obtain waivers, consents, estoppels and approvals from other parties to material leases to which Element and/or Ardagh is a party; and (xi) taking corporate and other actions necessary to permit the consummation of the Debt Financing. In connection with the marketing materials (including confidential information memoranda and lender presentations) and rating agency presentations related to the syndication of the Debt Financing, Element and Ardagh consent to the use of their name, logos, trademarks and service marks in a manner customary for such financing transactions; provided that such logos are used solely in a manner that is not intended to nor reasonably likely to harm or disparage Element or Ardagh or the reputation or goodwill of Element or Ardagh and their marks. |
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(iii) Element shall cause NewCo and its Subsidiaries (x) to enter into the agreements and other documents required to be entered by NewCo or any of its Subsidiaries in connection with the Debt Financing in form and substance reasonably satisfactory to Ardagh and Element and (y) not to amend or replace any such agreements |
79
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
or documents (or waive any material rights thereunder) without the prior written consent of Ardagh (not to be unreasonably withheld, conditioned or delayed). |
80
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
cause to be paid to NewCo the amount of any such intercompany receivables or loans owing to an Ardagh Purchased Entity and NewCo shall pay or cause to be paid to Ardagh or its Affiliates the amount of any such intercompany receivables or loans owing to Ardagh or its Affiliates (in each case, as reflected in such Final Closing Statement), unless otherwise agreed between Ardagh and Element. |
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(i) Upon the request of NewCo or the relevant Ardagh Purchased Entity or Exal Purchased Entity, Ardagh or Element, as applicable, shall (at NewCo’s cost), as promptly as practicable and subject to the reporting and other terms of the applicable policy, assert a claim under the applicable policy, including making all necessary notifications and submitting any reasonably required supporting documentation, and use reasonable best efforts to retain and administer such claim; provided that NewCo shall, and shall cause its relevant Subsidiaries to, provide such assistance, information and cooperation as is reasonably requested by Ardagh or its Representatives or Element or its |
81
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Representatives, as applicable (including their respective insurers, appointed claims handlers and any lawyers engaged in relation to such claim), in connection therewith; |
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(ii) Ardagh or Element, as applicable, shall have no obligation to make any such claim if and to the extent such claim is covered by an insurance policy held by NewCo or its Subsidiaries; |
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(iii) NewCo shall notify Ardagh or Element, as applicable, within fifteen (15) Business Days of an officer, director or manager of NewCo becoming aware of the claim; |
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(iv) NewCo shall, or shall cause its Subsidiaries to, reimburse Ardagh or Element, as applicable, for any deductible under the Ardagh Insurance Policy or Element Insurance Policy, as applicable, payable in respect of the claim; |
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(v) NewCo shall reimburse Ardagh or Element, as applicable, for any premium increases under the insurance policy under which the claim is made, where such increases are reasonably demonstrated by Ardagh (with respect to its insurance policy) or Element (with respect to its insurance policy) to be a direct result of any claim made pursuant to this Section 5.9(c); and |
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(vi) Ardagh or Element, as applicable, shall promptly pay to NewCo (or its designated Subsidiary) any proceeds actually received under the Ardagh Insurance Policy or Element Insurance Policy, as applicable (less any deductible or excess paid by Ardagh or any of its Affiliates or Element or any of its Affiliates (other than NewCo and its Subsidiaries), as applicable, in respect of such claim, and less any Tax incurred or withheld on the proceeds thereof and any reasonable out of pocket expenses actually incurred by Ardagh or any of its Affiliates or Element or any of its Affiliates (other than NewCo and its Subsidiaries), as applicable. |
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(vii) The Parties acknowledge and agree that the provisions of this Section 5.9(c) shall terminate on the sixth (6th) anniversary of the Closing Date. |
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(d) Filing Claims. In the event that NewCo requests that Ardagh or Element, as applicable, make a claim pursuant to Section 5.9: |
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(i) Ardagh or Element, as applicable, shall not be required to undertake or threaten litigation without NewCo having advanced to Ardagh or Element, as applicable, the funds reasonably estimated to be incurred in connection therewith; and |
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(ii) neither NewCo nor any of its Subsidiaries shall be entitled to any proceeds received by Ardagh or its Affiliates or Element or its Affiliates under any Ardagh Insurance Policy or Element Insurance Policy, as applicable, except to the extent that such proceeds relate to a claim covered under this Section 5.9 and are in respect of Losses for which NewCo or the relevant Subsidiary of NewCo has not already been reimbursed, indemnified or otherwise compensated in full by Ardagh or Element, as applicable, whether under this Agreement or otherwise; |
82
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(iii) NewCo shall, and shall cause the relevant Subsidiary of NewCo to, provide all assistance, information and cooperation reasonably requested by Ardagh or its Representatives or Element or its Representatives, as applicable (including its insurers, appointed claims handlers or any lawyers instructed in relation to such claim); and |
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(iv) NewCo shall, and shall cause the relevant Subsidiary of NewCo to, pay or bear any deductible or excess element of any such claim. |
83
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
letterheads, advertisements and promotional materials, inventory and other documents and materials included in the Ardagh Business (the “Ardagh Existing Stock”) that contain the “Ardagh” name or the other names, marks or identifiers set forth on Section 5.10 of the Ardagh Disclosure Schedule (collectively, the “Ardagh Marks”), after which period NewCo shall, and shall cause its applicable Subsidiaries to, remove, obliterate or cover the Ardagh Marks from such Ardagh Existing Stock or cease using such Ardagh Existing Stock. |
84
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Element, as applicable, shall cooperate and use commercially reasonable efforts after the Closing to relieve, remove, release and/or replace Ardagh and its Affiliates (other than the Ardagh Purchased Entities) and Element and its Affiliates (other than the Exal Purchased Entities) from any remaining Transferred Guarantees. For the avoidance of doubt, the Transferred Guarantees with respect to the Ardagh Business shall include (i) any joint and several liability statements issued by Ardagh or any of its Affiliates (other than an Ardagh Purchased Entity) in respect of any Ardagh Purchased Entity pursuant to Section 2:403 of the Dutch Civil Code or Section 264 (3) of the German Commercial Code, (ii) the guarantee issued by Ardagh MP Group Netherlands B.V. in relation to the Ardagh UK Impress Plan section of the Ardagh UK Plan and (iii) any statutory guarantee or statutory Liability of Ardagh or any of its Affiliates (other than an Ardagh Purchased Entity) in respect of Ardagh Metal Packaging Italy S.r.l, therewith including those pursuant to articles 2112, 2506 bis and 2506 quater, of the Italian civil code. |
85
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(ii) In the period between the date of this Agreement and the Closing Date, Ardagh shall cause the shareholders and managing directors of AGG and AGMP to take all steps required for the registration of the termination of the PLTA with the German Commercial Register, including a shareholders resolution of AGG approving the termination notice delivered pursuant to Section 5.12(a)(i). If, by the Closing Date, the termination of the PLTA has not been registered with the German Commercial Register, NewCo undertakes to use commercially reasonable efforts to cause the managing directors of AGMP to take all steps following the Closing Date required to register the termination of the PLTA with the German Commercial Register. |
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(v) The Parties acknowledge that: |
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(B) the amount of the Loss Compensation Receivable or of the Profit Transfer Payables, as the case may be, shall be determined on the basis of the PLTA Termination Accounts. |
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(vi) For purposes of Section 2.2, Section 2.4 and Section 2.9 and the related determinations therein, any Loss Compensation Receivables shall be included as Closing Cash and any Profit Transfer Payables shall be included as Closing Indebtedness, irrespective of when the actual due date for payment, or actual payment, of such amounts occur. |
86
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(ix) The Loss Compensation Receivable or Profit Transfer Payable will be reflected in the Initial Ardagh Closing Statement and Final Ardagh Closing Statement as determined in the Closing Statement Methodologies set forth on Exhibit A. For the avoidance of doubt, and notwithstanding Section 5.12(a)(iii), Section 5.12(a)(vii) and Section 5.12(a)(viii), this mechanism will be the sole satisfaction and settlement of the Loss Compensation Receivable or Profit Transfer Payable as may arise. |
87
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
ensure the recognition of a fiscal unity, require amendment, NewCo undertakes to procure that AGMP or AMPG, as the case may be, shall immediately make such amendments in accordance with applicable Tax Law, including any consequential amendments required to be made to any other financial statements or Tax Return or other declarations resulting from such amendments (the “Relevant PLTA Amendments”). |
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(C) for each Relevant Fiscal Year that requires an amendment of the financial statements of AMPG that results either in an increase or decrease of profits or, as the case may be, an increase or decrease of losses of AMPG in any Relevant Fiscal Year (in each case as compared with the profits and losses paid or settled under the Initial Settlement), NewCo shall procure that the respective PLTA Difference shall be settled between AGMP and AMPG within ten (10) Business Days after such PLTA Difference is determined. |
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(iv) The Parties acknowledge and agree that: |
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(A) an amount equal to each payment (if any) to be made by AGG to AGMP pursuant to Section 5.12(b)(iii)(A) shall be paid by NewCo to Ardagh; and |
88
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(B) an amount equal to each payment (if any) to be made by AGMP to AGG pursuant to Section 5.12(b)(iii)(B) shall be paid by Ardagh to NewCo, |
in each case, at the same time, or immediately upon, the relevant payment being made pursuant to Section 5.12(b)(iii)(A) or Section 5.12(b)(iii)(B), as applicable.
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(ii) The indemnification obligations of NewCo pursuant to Section 5.12(c)(i) shall terminate and cease to have any force and effect with respect to any Tax or decrease of current Tax losses or Tax loss carry forwards on the date that is nine (9) months following the date that such Tax or, in respect of the decrease of current Tax losses or Tax loss carry forwards, the decision of the Tax Authorities became final, binding and non-appealable. |
89
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
90
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
implement arrangements reasonably acceptable to both Parties to both (i) provide NewCo and its Subsidiaries, to the fullest extent practicable, with all claims, rights and benefits under the Ardagh Hedging Arrangements, including, for the avoidance of doubt, the mark-to-market position existing on the Closing Date and (ii) cause NewCo and its Subsidiaries to bear all Liabilities thereunder, including, for the avoidance of doubt, the mark-to-market position existing on the Closing Date. Upon maturity of any Ardagh Hedging Arrangements (or earlier crystallization of a hedge position upon NewCo’s instructions), (i) Ardagh shall remit funds to NewCo in respect of any such hedging arrangements that are in-the-money and (ii) NewCo will remit funds to Ardagh in respect of any that are out-of-the money, in each case, on the relevant date of settlement in accordance with market convention. |
91
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(i) disclosing to Ardagh, [*] all information in the possession, custody or control (in any form or medium, including documents) of NewCo or its Subsidiaries with respect to the activities of the Ardagh Purchased Entities [*]; |
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(ii) producing to Ardagh, the European Commission or any other relevant Governmental Authority all documents, records or other tangible evidence in the possession, custody or control of NewCo or its Subsidiaries relating to the Regulatory Investigations. [*]; |
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(iii) providing Ardagh with access to copies of original documents and records relating to the Regulatory Investigations in the possession, custody or control of NewCo or its Subsidiaries [*]; |
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(iv) [*] and |
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(v) providing such information (including testimony) as is reasonably necessary to identify or establish the original location, authenticity or other evidentiary foundation necessary to admit into evidence documents in any proceeding as requested by Ardagh related to the Regulatory Investigations. |
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(f) NewCo and Ardagh shall promptly inform and disclose to the other any developments or communications between such Party or any of its Subsidiaries, on the one hand, and any Governmental Authority or third party, on the other hand, with respect to the Regulatory Investigations, except as prohibited by Law. NewCo shall not engage in any negotiations with any Governmental Authority or third party with respect to the Regulatory Investigations without the express prior written consent of Ardagh. [*]. |
92
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(k) Procedures for Indemnification of Third Party Claims. |
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(iii) [*] |
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(iv) Unless Ardagh has failed to assume the defense of the Third Party Claim for which indemnification is available under this Section 5.15 in accordance with the terms of this Agreement, no Indemnified Party may settle or compromise such Third Party Claim without the consent of Ardagh. |
93
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(v) Ardagh shall not consent to entry of any judgment or enter into any settlement of the Third Party Claim without the prior written consent of an Indemnified Party if the effect thereof[*]. |
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(m) Mitigation of Damages. Each of Element and NewCo agrees to attempt to mitigate, and to cause each of their respective Affiliates to attempt to mitigate, any Losses that such party may suffer as a consequence of any matter giving rise to a right to indemnification under this Section 5.15. |
94
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
95
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Purchased Entity, including, for the avoidance of doubt, those Contracts set forth on Section 5.18(a)(ii) of the Ardagh Disclosure Schedule. |
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(i) Ardagh shall, and shall cause its Affiliates to, without further consideration therefor, pay and remit to NewCo promptly all monies, rights and other consideration received, net of any reasonable documented out-of-pocket costs payable to a third party, in respect of such performance. From and after the Closing, Ardagh on behalf of itself and its Affiliates, authorizes NewCo and its Subsidiaries, to the maximum extent permitted by applicable Law and the terms of the Delayed Transfer Asset, at NewCo’s expense, to perform all the obligations and receive all the benefits of Ardagh or its Affiliates under the Delayed Transfer Asset. |
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(ii) NewCo shall, and shall cause its Affiliates to, without further consideration therefor, pay and remit to Ardagh promptly all monies, rights and other consideration received, net of any reasonable documented out-of-pocket costs payable to a third party, in respect of such performance. From and after the Closing, NewCo on behalf of itself and its Affiliates, authorizes Ardagh and its Affiliates, to the maximum extent permitted by applicable Law and the terms of the Delayed Transfer Asset, at Ardagh’s expense, to perform all the obligations and receive all the benefits of NewCo or its Affiliates under the Delayed Transfer Asset. |
96
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
97
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
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(i) As of the Closing, NewCo shall, or shall cause a Subsidiary to, assume or continue, as the case may be, sponsorship of, and all obligations with respect to, each Ardagh Transferred Plan and honor and discharge all obligations under such Ardagh Transferred Plan. |
98
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
forth on Section 4.15(a) of the Element Disclosure Schedules under the header “Element Parent Plans”. |
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(iv) Neither NewCo nor any of its Affiliates, including the Exal Purchased Entities, shall (A) assume sponsorship of, or subject to the Mutual Services Agreement, or any costs or Liabilities under any of the Element Parent Plans, or (B) receive any right or interest in any trusts relating to, any assets of or any insurance, administration or other contracts pertaining to any of the Element Parent Plans. Except as otherwise specifically provided in this Agreement or the Mutual Services Agreement, effective as of the Closing Date, all Element Business Employees shall cease any benefit accrual under all Element Parent Plans and all Exal Purchased Entities shall cease being participating employers under all Element Parent Plans. |
|
(c) [*]. |
99
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Closing occurs starting on January 1 of such calendar year and ending on the day prior to the Closing Date. All Liabilities related to the Excluded Compensation Payments shall be borne exclusively by Element and its Affiliates (including through the adjustments contemplated by Section 2.2 and Section 2.9 in accordance with the Closing Statement Methodologies), and Ardagh and its Affiliates shall not have any Liability with respect to the Excluded Compensation Payments (whether by virtue of Ardagh’s position as a voting shareholder of NewCo or otherwise). Upon request by Ardagh, NewCo shall provide a schedule of any or all Excluded Compensation Payments and a summary of the calculation method for the payment amounts on such schedule. |
|
(ii) NewCo shall not assume the Element Parent Plans or have any obligations, nor make any payments, with respect thereto. |
|
(iv) NewCo shall, or shall cause a Subsidiary to, assume or continue, as the case may be, sponsorship of, and all obligations with respect to, and honor and discharge all obligations with respect to any [*] to any current or former Ardagh Business Employee, in each case as a result of the execution and delivery of this Agreement or the consummation of the Transactions (including [*]) alone or in conjunction with any other event (including post-Closing service); provided that, all Liabilities related to such payments shall be borne exclusively by Ardagh and its Affiliates and that, upon request by Element, NewCo shall provide a schedule of any or all such payments and a summary of the calculation method for the payment amounts on such schedule. |
100
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Impress Plan into another appropriate arrangement (the “NewCo UK DB Plan”) separate from the Ardagh UK Plan. |
101
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
102
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Plan or other Plan (that is not an Ardagh Transferred Plan) that is sponsored or maintained by Ardagh or any of its Affiliates or with respect to which Ardagh or any of its Affiliates may have any Liability (whether contingent or otherwise) that, in each case, is incurred with respect to any Person other than an Ardagh Business Employee, and in each case that is assessed against NewCo or any of its Affiliates. From and after the Closing, NewCo shall indemnify, defend and hold harmless Ardagh and its Affiliates from and against any Liability assumed or continued by NewCo or its Subsidiaries pursuant to Section 6.2. |
|
(d) From and after the Closing, Element shall indemnify, defend and hold harmless NewCo and its Affiliates from and against any Liability relating to any Element Parent Plan or other Plan (that is not an Element Plan) that is sponsored or maintained by Element or any of its Affiliates or with respect to which Element or any of its controlled Affiliates may have any Liability (whether contingent or otherwise) that, in each case, is incurred with respect to any Person other than an Exal Business Employee, and in each case that is assessed against NewCo or any of its controlled Affiliates. From and after the Closing, NewCo shall indemnify, defend and hold harmless Element and its Affiliates from and against any Liability assumed or continued by NewCo or its Subsidiaries pursuant to Section 6.2. |
103
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Transferred Business Employee and any covered dependent for any co-payments and deductibles and use commercially reasonable efforts to credit out-of-pocket expenses paid by such Transferred Business Employee or any covered dependent under the corresponding Ardagh Transferred Plan, Ardagh Retained Plan or Element Plan during the relevant plan year, up to and including the Closing Date and (iii) credit each Transferred Business Employee with all vacation and personal holiday time that such Transferred Business Employee has accrued but had not used as of the Closing. |
104
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
(d) Acceptance of the French and Dutch Offers. The French Acceptance Notice and the Dutch Acceptance Notice shall have been delivered to NewCo as set forth in Section 2.8. |
|
(c) Closing Deliverables. Ardagh shall have received each of the deliverables, documents and instruments required to be delivered to it pursuant to Sections 2.5(d), 2.6(b) and 2.6(c). |
105
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
relate to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date), (ii) the representation and warranty set forth in Section 3.7(a) shall be true and correct in all respects as of the Closing Date as though made on and as of such date and (iii) the representations and warranties of Ardagh set forth in this Agreement (other than the Ardagh Fundamental Representations and the representation and warranty set forth in Section 3.7(a)) shall be true and correct as of the Closing Date as though made as of such date (except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date), except where the failure of such representations and warranties to be so true and correct (without giving effect to any limitation as to materiality or “Material Adverse Effect” or similar qualifications set forth therein) individually or in the aggregate has not had, and would not reasonably be expected to have, a Material Adverse Effect. |
|
(c) Closing Deliverables. Element shall have received each of the deliverables, documents and instruments required to be delivered to it pursuant to Sections 2.5(c), 2.6(a) and 2.6(c). |
106
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
and all rights, claims and causes of action it may have against any Party or its Affiliates (or any of their respective their respective current and former directors, officers, members, managers, partners, employees, advisors, consultants, agents or other representatives), or any of their respective successors or permitted assigns, relating to the breach of any representation or warranty in this Agreement or in any document, agreement, certificate or instrument delivered pursuant to this Agreement, or of any covenant or agreement to be performed prior to the Closing, other than the covenants contained in Section 5.1 and Section 5.2 or any covenant and agreement that contemplates performance after the Closing (including, for the avoidance of doubt, the rights to indemnification set forth in Section 5.7(b)(i), Section 5.9(e), Section 5.11, Section 5.15 and Section 6.3), whether for breach of contract, in tort, or pursuant to any other theory of liability or under, or based upon, any applicable Law or otherwise (including any right, whether arising at law or in equity, to seek indemnification, contribution, cost recovery, damages or any other recourse or remedy, including as may arise under common law) are hereby irrevocably waived. |
107
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
108
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Ardagh Group S.A.
56, rue Charles Martel
L-2134 Luxembourg, Luxembourg
[*]
With a copy (which shall not constitute notice) to:
109
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
Shearman & Sterling, LLP
599 Lexington Avenue
New York, NY 10022-6069
[*]
c/o Ontario Teachers’ Pension Plan Board
5656 Yonge Street
Toronto, Ontario, Canada M2M 4H5
[*]
With a copy (which shall not constitute notice) to:
767 Fifth Avenue
New York, NY 10153
[*]
Trivium Packaging B.V.
Atrium Building, 8th Floor
Strawinskylaan 3127
1077 ZX, Amsterdam, the Netherlands
With a copy (which shall not constitute notice) to Ardagh and Element at the addresses set forth above.
|
10.3 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to conflicts of laws principles. |
110
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
the jurisdiction of any Agreed Court, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the Transactions may not be enforced in or by any of the above named courts. In any such Action, the Parties irrevocably consent to service of process in the manner provided for notices in Section 10.2, or in any other manner permitted by applicable Law. The Parties further agree that, to the extent permitted by Law, that any final and unappealable judgment against a Party in any such Action shall be conclusive and may be enforced in any other jurisdiction within or outside the United States by suit on the judgment, a certified or exemplified copy of which shall be conclusive evidence of the fact and amount of such judgment. |
111
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
(g) To the extent permitted by Law, the Parties waive any right to appeal points of law provided under Sections 46 or 69 of the English Arbitration Act of 1996. |
|
(h) The International Bar Association Rules on the Taking of Evidence in International Arbitration (2010) shall apply. |
|
(l) Each Party participating in such arbitration shall pay its own legal fees and expenses incurred in connection with the arbitration, unless otherwise determined by the arbitral tribunal. |
112
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
validly be made. Judgment upon the award may be entered by any court having jurisdiction thereof or having jurisdiction over the relevant Party or its assets. |
|
(o) Any monetary damages awarded shall be payable in U.S. Dollars unless otherwise agreed by the parties thereto. |
113
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
10.11 Amendment. This Agreement may be amended, supplemented, modified or restated only by a written agreement executed by each of the Parties. |
[Remainder of page intentionally left blank]
114
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the date first written above.
ARDAGH GROUP S.A.
By: /s/ W.O.H. Fry
Name: W.O.H. Fry
Title: Director
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
ELEMENT HOLDINGS II, L.P.
By: Element General Partner, Ltd.,
its general partner
By: /s/ Russell Hammond
Name: Russell Hammond
Title: Director
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
TRIVIUM PACKAGING B.V.
duly represented by its sole director,
Element Netherlands Holding Coöperatief U.A.
By: /s/ Michael Mapes
Name: Michael Mapes
Title: Director
By: /s/ S. Haver
Name: S. Haver
Title: Director
[*] Certain information in this document has been omitted from this exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
SUBSIDIARIES OF ARDAGH GROUP S.A.
The following table provides information relating to our principal operating subsidiaries, all of which are wholly owned, at December 31, 2019.
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|
|
|
|
Country of |
|
|
Company |
|
incorporation |
|
Activity |
Ardagh Metal Beverage Manufacturing Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Austria GmbH |
|
Austria |
|
Metal Beverage Packaging |
Latas Indústria de Embalagens de Alumínio do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Indústria de Embalagens de Metálicas do Brasil Ltda. |
|
Brazil |
|
Metal Beverage Packaging |
Ardagh Glass Holmegaard A/S |
|
Denmark |
|
Glass Packaging |
Ardagh Metal Beverage Trading France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Metal Beverage France SAS |
|
France |
|
Metal Beverage Packaging |
Ardagh Glass GmbH |
|
Germany |
|
Glass Packaging |
Heye International GmbH |
|
Germany |
|
Glass Engineering |
Ardagh Metal Beverage Trading Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Germany GmbH |
|
Germany |
|
Metal Beverage Packaging |
Ardagh Glass Sales Limited |
|
Ireland |
|
Glass Packaging |
Ardagh Packaging Holdings Limited |
|
Ireland |
|
Glass and Metal Beverage Packaging |
Ardagh Glass Italy S.r.l. |
|
Italy |
|
Glass Packaging |
Ardagh Glass Dongen B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Glass Moerdijk B.V. |
|
Netherlands |
|
Glass Packaging |
Ardagh Metal Beverage Trading Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Netherlands B.V. |
|
Netherlands |
|
Metal Beverage Packaging |
Ardagh Glass S.A. |
|
Poland |
|
Glass Packaging |
Ardagh Metal Beverage Trading Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Poland Sp. z o.o |
|
Poland |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Trading Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Metal Beverage Spain SL |
|
Spain |
|
Metal Beverage Packaging |
Ardagh Glass Limmared AB |
|
Sweden |
|
Glass Packaging |
Ardagh Metal Beverage Europe GmbH |
|
Switzerland |
|
Metal Beverage Packaging |
Ardagh Glass Limited |
|
United Kingdom |
|
Glass Packaging |
Ardagh Metal Beverage Trading UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Metal Beverage UK Limited |
|
United Kingdom |
|
Metal Beverage Packaging |
Ardagh Glass Inc. |
|
United States |
|
Glass Packaging |
Ardagh Metal Beverage USA Inc. |
|
United States |
|
Metal Beverage Packaging |
Exhibit 12.1
CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Paul Coulson, certify that:
|
3. |
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
|
4. |
|
The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
|
a. |
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
b. |
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
c. |
|
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
d. |
|
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
|
5. |
|
The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
|
a. |
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
|
b. |
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: February 27, 2020
|
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|
|
Ardagh Group S.A. |
|
|
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|
|
|
|
By: |
/s/ PAUL COULSON |
|
|
Name: |
Paul Coulson |
|
|
Title: |
Chief Executive Officer |
|
Exhibit 12.2
CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, David Matthews, certify that:
|
2. |
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
|
3. |
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
|
4. |
|
The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
|
a. |
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
b. |
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
c. |
|
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
d. |
|
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
|
5. |
|
The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
|
a. |
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
|
b. |
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: February 27, 2020
|
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|
Ardagh Group S.A. |
|
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By: |
/s/ DAVID MATTHEWS |
|
Name: |
David Matthews |
|
Title: |
Chief Financial Officer |
Exhibit 13.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the annual report on Form 20-F of Ardagh Group S.A. (the “Company”) for the period ending December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certify that to the best of our knowledge:
|
1. |
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|
2. |
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: February 27, 2020
|
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|
|
Ardagh Group S.A. |
|
|
|
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|
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By: |
/s/ PAUL COULSON |
|
|
Name: |
Paul Coulson |
|
|
Title: |
Chief Executive Officer |
|
Exhibit 13.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the annual report on Form 20-F of Ardagh Group S.A. (the “Company”) for the period ending December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certify that to the best of our knowledge:
|
1. |
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|
2. |
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: February 27, 2020
|
|
|
|
Ardagh Group S.A. |
|
|
|
|
|
By: |
/s/ DAVID MATTHEWS |
|
Name: |
David Matthews |
|
Title: |
Chief Financial Officer |
Exhibit 99.4
ARDAGH PACKAGING FINANCE PLC
AND
ARDAGH HOLDINGS USA INC.
AS ISSUERS,
ARDAGH GROUP S.A.,
AS PARENT GUARANTOR,
CITIBANK, N.A., LONDON BRANCH,
AS TRUSTEE, PRINCIPAL PAYING AGENT AND TRANSFER AGENT,
and
CITIGROUP GLOBAL MARKETS DEUTSCHLAND AG,
AS REGISTRAR
_____________________________
INDENTURE
Dated as of June 12, 2017
_____________________________
4.750% SENIOR NOTES DUE 2027
TABLE OF CONTENTS
Page
ARTICLE One
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.Definitions.............................................................................................................................1
SECTION 1.02.Other Definitions.................................................................................................................30
SECTION 1.03.Rules of Construction...........................................................................................................31
SECTION 1.04.Agency of Irish Issuer...........................................................................................................32
ARTICLE Two
THE NOTES
SECTION 2.01.The Notes...........................................................................................................................32
SECTION 2.02.Execution and Authentication...............................................................................................33
SECTION 2.03.Registrar, Transfer Agent and Paying Agent...........................................................................34
SECTION 2.04.Paying Agent to Hold Money...............................................................................................35
SECTION 2.05.Holder Lists.........................................................................................................................35
SECTION 2.06.Transfer and Exchange.........................................................................................................36
SECTION 2.07.Replacement Notes.............................................................................................................38
SECTION 2.08.Outstanding Notes...............................................................................................................38
SECTION 2.09.Notes Held by Issuers.........................................................................................................38
SECTION 2.10.Certificated Notes...............................................................................................................39
SECTION 2.11.Cancellation.......................................................................................................................39
SECTION 2.12.Defaulted Interest...............................................................................................................39
SECTION 2.13.Computation of Interest.......................................................................................................40
SECTION 2.14.ISIN and Common Code Numbers.........................................................................................40
SECTION 2.15.Issuance of Additional Notes...............................................................................................40
ARTICLE Three
REDEMPTION; OFFERS TO PURCHASE
SECTION 3.01.Right of Redemption...........................................................................................................40
SECTION 3.02.Notices to Trustee...............................................................................................................40
SECTION 3.03.Selection of Notes to Be Redeemed.....................................................................................41
SECTION 3.04.Notice of Redemption.........................................................................................................41
SECTION 3.05.Deposit of Redemption Price...............................................................................................42
SECTION 3.06.Payment of Notes Called for Redemption.............................................................................42
SECTION 3.07.Notes Redeemed in Part.....................................................................................................43
ARTICLE Four
COVENANTS
SECTION 4.01.Payment of Notes...............................................................................................................43
SECTION 4.02.Corporate Existence.............................................................................................................43
SECTION 4.03.Maintenance of Properties...................................................................................................44
SECTION 4.04.Insurance...........................................................................................................................44
SECTION 4.05.Statement as to Compliance.................................................................................................44
SECTION 4.06.Limitation on Debt...............................................................................................................44
SECTION 4.07.Limitation on Liens...............................................................................................................48
SECTION 4.08.Limitation on Restricted Payments.......................................................................................49
SECTION 4.09.Limitation on Sale of Certain Assets.....................................................................................53
SECTION 4.10.Limitation on Transactions with Affiliates...............................................................................55
SECTION 4.11.Purchase of Notes upon a Change of Control.........................................................................57
SECTION 4.12.Additional Amounts.............................................................................................................59
SECTION 4.13.Additional Intercreditor Agreements...................................................................................61
SECTION 4.14.Additional Subsidiary Guarantees.........................................................................................62
SECTION 4.15.Limitation on Guarantees of Debt by Restricted Subsidiaries...................................................62
SECTION 4.16.Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries.......64
SECTION 4.17.Designation of Unrestricted and Restricted Subsidiaries.........................................................66
SECTION 4.18.Payment of Taxes and Other Claims.....................................................................................66
SECTION 4.19.Reports to Holders...............................................................................................................66
SECTION 4.20.Further Instruments and Acts...............................................................................................67
SECTION 4.21.Limitation on Layered Debt...................................................................................................67
SECTION 4.22.Suspension of Covenants.....................................................................................................68
SECTION 4.23.Accession of Excluded Group................................................................................................68
ARTICLE Five
CONSOLIDATION, MERGER AND SALE OF ASSETS
SECTION 5.01.Consolidation, Merger and Sale of Assets.............................................................................68
SECTION 5.02.Successor Substituted.........................................................................................................70
ARTICLE Six
DEFAULTS AND REMEDIES
SECTION 6.01.Events of Default.................................................................................................................70
SECTION 6.02.Acceleration.......................................................................................................................72
SECTION 6.03.Other Remedies.................................................................................................................73
SECTION 6.04.Waiver of Past Defaults.......................................................................................................73
SECTION 6.05.Control by Majority.............................................................................................................73
SECTION 6.06.Limitation on Suits...............................................................................................................74
SECTION 6.07.Unconditional Right of Holders to Bring Suit for Payment.......................................................74
SECTION 6.08.Collection Suit by Trustee.....................................................................................................74
SECTION 6.09.Trustee May File Proofs of Claim...........................................................................................75
SECTION 6.10.Application of Money Collected...........................................................................................75
SECTION 6.11.Undertaking for Costs.........................................................................................................76
SECTION 6.12.Restoration of Rights and Remedies.....................................................................................76
SECTION 6.13.Rights and Remedies Cumulative.........................................................................................76
SECTION 6.14.Delay or Omission Not Waiver.............................................................................................76
SECTION 6.15.Record Date.......................................................................................................................76
SECTION 6.16.Waiver of Stay or Extension Laws.........................................................................................76
ARTICLE Seven
TRUSTEE
SECTION 7.01.Duties of Trustee.................................................................................................................77
SECTION 7.02.Certain Rights of Trustee.....................................................................................................78
SECTION 7.03.Individual Rights of Trustee.................................................................................................80
SECTION 7.04.Disclaimer of Trustee...........................................................................................................80
SECTION 7.05.Compensation and Indemnity...............................................................................................80
SECTION 7.06.Replacement of Trustee.......................................................................................................81
SECTION 7.07.Successor Trustee by Merger...............................................................................................82
SECTION 7.08.Eligibility; Disqualification...................................................................................................82
SECTION 7.09.Appointment of Co-Trustee.................................................................................................82
SECTION 7.10.Resignation of Agents.........................................................................................................83
SECTION 7.11.Agents General Provisions...................................................................................................84
ARTICLE Eight
DEFEASANCE; SATISFACTION AND DISCHARGE
SECTION 8.01.Issuers’ Option to Effect Defeasance or Covenant Defeasance.................................................85
SECTION 8.02.Defeasance and Discharge...................................................................................................85
SECTION 8.03.Covenant Defeasance.........................................................................................................86
SECTION 8.04.Conditions to Defeasance.....................................................................................................86
SECTION 8.05.Satisfaction and Discharge of Indenture.................................................................................88
SECTION 8.06.Survival of Certain Obligations.............................................................................................88
SECTION 8.07.Acknowledgment of Discharge by Trustee.............................................................................88
SECTION 8.08.Application of Trust Money...................................................................................................89
SECTION 8.09.Repayment to Issuers.........................................................................................................89
SECTION 8.10.Indemnity for Government Securities...................................................................................89
SECTION 8.11.Reinstatement...................................................................................................................89
ARTICLE Nine
AMENDMENTS AND WAIVERS
SECTION 9.01.Without Consent of Holders.................................................................................................90
SECTION 9.02.With Consent of Holders.....................................................................................................91
SECTION 9.03.Effect of Supplemental Indentures.......................................................................................92
SECTION 9.04.Notation on or Exchange of Notes.........................................................................................92
SECTION 9.05.Notice of Amendment or Waiver...........................................................................................92
SECTION 9.06.Trustee to Sign Amendments, Etc..........................................................................................92
SECTION 9.07.Additional Voting Terms; Calculation of Principal Amount.......................................................92
ARTICLE Ten
GUARANTEE
SECTION 10.01.Notes Guarantees...............................................................................................................93
SECTION 10.02.Subrogation.........................................................................................................................94
SECTION 10.03.Release of Subsidiary Guarantees.........................................................................................95
SECTION 10.04.Limitation and Effectiveness of Guarantees...........................................................................95
SECTION 10.05.Notation Not Required.........................................................................................................95
SECTION 10.06.Successors and Assigns.........................................................................................................96
SECTION 10.07.No Waiver...........................................................................................................................96
SECTION 10.08.Modification.......................................................................................................................96
ARTICLE Eleven
SUBORDINATION
SECTION 11.01.Agreement to Subordinate...................................................................................................96
SECTION 11.02.Liquidation, Dissolution, Bankruptcy.....................................................................................96
SECTION 11.03.Payment Blockage...............................................................................................................97
SECTION 11.04.Trustee Entitled to Rely.......................................................................................................98
SECTION 11.05.Trustee to Effectuate Subordination of Each Subsidiary Guarantee; Intercreditor Agreement...98
SECTION 11.06.Trustee Not Fiduciary for the Holders of Senior Debt.............................................................99
SECTION 11.07.Reliance on Subordination Provisions; Amendments.............................................................99
SECTION 11.08.Trustee’s Compensation Not Prejudiced...............................................................................99
SECTION 11.09.Subrogation to Rights of Holders of Senior Debt.....................................................................99
SECTION 11.10.Provisions Solely to Define Relative Rights.........................................................................100
SECTION 11.11.Notice to Trustee.............................................................................................................100
SECTION 11.12.No Suspense of Remedies.................................................................................................100
SECTION 11.13.Trust Moneys Not Subordinated.......................................................................................100
ARTICLE Twelve
MISCELLANEOUS
SECTION 12.01.Release of U.S. Issuer’s Obligations...................................................................................101
SECTION 12.02.Notices...............................................................................................................................101
SECTION 12.03.Certificate and Opinion as to Conditions Precedent.............................................................104
SECTION 12.04.Statements Required in Certificate or Opinion...................................................................104
SECTION 12.05.Rules by Trustee, Paying Agent and Registrar.....................................................................104
SECTION 12.06.Legal Holidays.................................................................................................................104
SECTION 12.07.Governing Law.................................................................................................................104
SECTION 12.08.Jurisdiction.....................................................................................................................105
SECTION 12.09.No Recourse Against Others.............................................................................................105
SECTION 12.10.Successors.......................................................................................................................105
SECTION 12.11.Multiple Originals.............................................................................................................105
SECTION 12.12.Table of Contents, Cross-Reference Sheet and Headings.....................................................105
SECTION 12.13.Severability.....................................................................................................................106
SECTION 12.14.Currency Indemnity.........................................................................................................106
SECTION 12.15.Contractual Recognition of Bail-In.....................................................................................106
Schedules
Schedule I-Agreed Security Principles
Exhibits
Exhibit A-Form of Notes
Exhibit B-Form of Transfer Certificate for Transfer from Restricted Global Note to Regulation S Global Note
Exhibit C-Form of Transfer Certificate for Transfer from Regulation S Global Note to Restricted Global Note
INDENTURE dated as of June 12, 2017 among Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland (the “Irish Issuer”), Ardagh Holdings USA Inc., a Delaware corporation (the “U.S. Issuer” and, together with the Irish Issuer, the “Issuers”), Ardagh Group S.A., a public limited liability company (société anonyme) organised and existing in accordance with the laws of Luxembourg, with registered office at 56, rue Charles Martel, L-2134 Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B160804 (the “Parent Guarantor”), Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as transfer agent (the “Transfer Agent”) and Citigroup Global Markets Deutschland AG, as Registrar.
RECITALS OF THE ISSUERS AND THE PARENT GUARANTOR
The Issuers have duly authorized the execution and delivery of this Indenture to provide for the issuance of their 4.750% Senior Notes due 2027 issued on the date hereof (the “Original Notes”) and any additional notes that may be issued after the Issue Date under this Indenture (“Additional Notes”). The Original Notes and Additional Notes together are the “Notes”. The Issuers and the Parent Guarantor have received good and valuable consideration for the execution and delivery of this Indenture. The Parent Guarantor will derive substantial direct and indirect benefits from the issuance of the Notes. All necessary acts and things have been done to make (i) the Notes, when duly issued and executed by the Issuers and authenticated and delivered hereunder, the legal, valid and binding obligations of the Issuers and (ii) this Indenture (including the Guarantees included herein) a legal, valid and binding agreement of the Issuers and the Parent Guarantor in accordance with the terms of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:
“Acquired Business” means the properties, businesses, assets and liabilities acquired pursuant to the Equity and Asset Purchase Agreement and in connection therewith, including under any annexes, schedules and related documents.
“Acquired Debt” means Debt of a Person:
(a)existing at the time such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Parent Guarantor or any Restricted Subsidiary; or
(b)assumed in connection with the acquisition of assets from any such Person,
in each case; provided that such Debt was not Incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary or such acquisition, as the case may be.
Acquired Debt will be deemed to be Incurred on the date the acquired Person becomes a Restricted Subsidiary or the date of the related acquisition of assets from any such Person.
“Acquisition” means the acquisition of the Acquired Business pursuant to the Equity and Asset Purchase Agreement.
“Affiliate” means, with respect to any specified Person:
(a)any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person;
(b)any other Person that owns, directly or indirectly, 5% or more of such specified Person’s Capital Stock or any officer or director of any such specified Person or other Person or, with respect to any natural Person, any Person having a relationship with such Person by blood, marriage or adoption not more remote than first cousin; or
(c)any other Person 5% or more of the Voting Stock of which is beneficially owned or held, directly or indirectly, by such specified Person.
For the purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Agreed Security Principles” means the Agreed Security Principles as set forth on Schedule I hereto.
“Applicable Law” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Asset Sale” means any sale, issuance, conveyance, transfer, lease or other disposition (including, without limitation, by way of merger, consolidation or sale and leaseback transaction) (collectively, a “transfer”), directly or indirectly, in one or a series of related transactions, of:
(a)any Capital Stock of any Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Parent Guarantor or a Restricted Subsidiary);
(b)all or substantially all of the properties and assets of any division or line of business of the Parent Guarantor or any Restricted Subsidiary; or
(c)any other of the Parent Guarantor’s or any Restricted Subsidiary’s properties or assets.
Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(i)any transfer or disposition of assets that is governed by the provisions of Article Five and Section 4.11 or any transfer or disposition of assets consummated in connection with a Permitted Reorganization;
(ii)any transfer or disposition of assets by the Parent Guarantor to the Issuers or any Restricted Subsidiary, or by any Restricted Subsidiary to the Parent Guarantor, the Issuers or any Restricted Subsidiary in accordance with the terms of this Indenture;
(iii)any transfer or disposition of obsolete or permanently retired equipment or facilities that are no longer useful in the conduct of the Parent Guarantor’s and any Restricted Subsidiary’s business and that are disposed of in the ordinary course of business;
(iv)any disposition of accounts receivable and related assets in a Permitted Receivables Financing;
(v)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(vi)the foreclosure, condemnation or any similar action with respect to any property or other assets;
(vii)any unwinding or termination of hedging obligations not for speculative purposes;
(viii)any single transaction or series of related transactions that involves assets or Capital Stock having a Fair Market Value of less than €25,000,000;
(ix)for the purposes of Section 4.09 only, the making of a Permitted Investment or a disposition permitted under Section 4.08;
(x)the sale, lease or other disposition of equipment, inventory, property or other assets in the ordinary course of business;
(xi)the lease, assignment or sublease of any real or personal property in the ordinary course of business;
(xii)an issuance of Capital Stock by a Restricted Subsidiary to the Parent Guarantor or to another Restricted Subsidiary;
(xiii)a Permitted Investment or a Restricted Payment (or a transaction that would constitute a Restricted Payment but for the exclusions from the definition thereof) that is not prohibited by Section 4.08;
(xiv)any disposition of Capital Stock, Debt or other securities of any Unrestricted Subsidiary or a Permitted Joint Venture;
(xv)sales of assets received by the Parent Guarantor or any Restricted Subsidiary upon the foreclosure on a Lien granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(xvi)sales or grants of licenses to use the patents, trade secrets, know-how and other intellectual property of the Parent Guarantor or any of its Restricted Subsidiaries to the extent that such license does not prohibit the Parent Guarantor or any of its Restricted Subsidiaries from using the technologies licensed (other than pursuant to exclusivity or non-competition arrangements negotiated on an arm’s–length basis) or require the Parent Guarantor or any of its Restricted Subsidiaries to pay any fees for any such use;
(xvii)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business; or
(xviii)sales, issuances, conveyances, transfers, leases or other dispositions to the extent constituting Permitted Liens.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Average Life” means, as of the date of determination with respect to any Debt, the quotient obtained by dividing:
(a)the sum of the products of:
(i)the numbers of years from the date of determination to the date or dates of each successive scheduled principal payment of such Debt; multiplied by
(ii)the amount of each such principal payment;
by
(b)the sum of all such principal payments.
“Bankruptcy Law” means any law relating to bankruptcy, insolvency, receivership, moratorium, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law, including, without limitation, (i) bankruptcy law of Ireland, (ii) bankruptcy law of The Netherlands, (iii) bankruptcy law of England, (iv) bankruptcy law of Germany, (v) bankruptcy law of Sweden, (vi) bankruptcy law of Denmark, (vii) bankruptcy law of Poland, (viii) bankruptcy law of Italy, or (ix) Title 11, United States Bankruptcy Code of 1978, as amended or (x) insolvency law of Luxembourg.
“Book-Entry Interest” means a beneficial interest in a Global Note held through and shown on, and transferred only through, records maintained in book-entry form by Euroclear or Clearstream and their respective nominees and successors, acting through themselves or the Common Depositary and its nominees and successors.
“Business Day” means a day of the year on which banks are not required or authorized by law to close in Dublin, New York City or London.
“Capital Stock” means, with respect to any Person, any and all shares, interests, partnership interests (whether general or limited), participations, rights in or other equivalents (however designated) of such Person’s equity, any other interest or participation that confers the right to receive a share of the profits and losses, or distributions of assets of, such Person and any rights (other than debt securities convertible into or exchangeable for Capital Stock), warrants or options exchangeable for or convertible into such Capital Stock, whether now outstanding or issued after the Issue Date.
“Capitalized Lease Obligation” means, with respect to any Person, any obligation of such Person under a lease of (or other agreement conveying the right to use) any property (whether real, personal or mixed), which obligation is required to be classified and accounted for as a capital lease obligation under IFRS, and, for purposes of this Indenture, the amount of such obligation at any date will be the capitalized amount thereof at such date, determined in accordance with IFRS and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Cash Equivalents” means any of the following:
(a)any evidence of Debt with a maturity of 180 days or less from the date of acquisition issued or directly and fully guaranteed or insured by a member state of the European Union or European Economic Area, the United States of America, any state thereof or the District of Columbia, Canada, Switzerland, Australia or any agency or instrumentality thereof (each, an “Approved Jurisdiction”);
(b)time deposit accounts, certificates of deposit, money market deposits or bankers’ acceptances with a maturity of 180 days or less from the date of acquisition issued by a bank or trust company having combined capital and surplus and undivided profits of not less than €500 million, whose debt has a rating, at the time any investment is made therein, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s;
(c)commercial paper with a maturity of 180 days or less from the date of acquisition issued by a corporation that is not either Issuer’s or any Restricted Subsidiary’s Affiliate and is at the time of acquisition, rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s;
(d)repurchase obligations with a term of not more than seven days for underlying securities of the type described in clause (a) or (b) above entered into with a financial institution meeting the qualifications described in clause (b) above;
(e)investments in money market mutual funds at least 95% of the assets of which constitute Cash Equivalents of the kind described in clauses (a) through (d) above; or
(f)any investments classified as cash equivalents under IFRS.
“Change of Control” means the occurrence of any of the following events:
(a)the consummation of any transaction (including a merger or consolidation) the result of which is that (i) any person or group, other than one or more Permitted Holders, is or as a result of such transaction becomes, the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of the Parent Guarantor and (ii) the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such other person or group; or
(b)the sale, transfer, conveyance or other disposition (other than by way of merger, consolidation or transfer of the Parent Guarantor’s Voting Stock or in connection with a Permitted Reorganization) of all or substantially all of the assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor, the Issuers and the Restricted Subsidiaries, on a consolidated basis, to any person or group other than one or more Permitted Holders; or
(c)the Parent Guarantor or either Issuer is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which does not violate the provisions described under Article Five or in connection with a Permitted Reorganization; or
(d)the Parent Guarantor or any Surviving Entity ceases to beneficially own, directly or indirectly, 100% of the Voting Stock of either Issuer, other than director’s qualifying shares and other shares required to be issued by law.
For the purposes of this definition, (i) “person” and “group” have the meanings they have in Sections 13(d) and 14(d) of the Exchange Act; (ii) “beneficial owner” is used as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time; and (iii) a Person or group will be deemed to beneficially own all Voting Stock of an entity held by a parent entity, if such Person or group is or becomes the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of such parent entity and the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such Person or group.
“Clearstream” means Clearstream Banking, société anonyme or any successor thereof.
“Code” means the Internal Revenue Code of 1986, as amended.
“Commission” means the U.S. Securities and Exchange Commission.
“Commodity Hedging Agreements” means any type of commodity hedging agreement designed to protect against or manage exposure to fluctuations in commodity prices and entered into in good faith in the ordinary course of business for such purposes.
“Common Depositary” means a depositary common to Euroclear and Clearstream, being initially Citibank Europe plc, until a successor Common Depositary, if any, shall have become such pursuant to this Indenture, and thereafter Common Depositary shall mean or include each Person who is then a Common Depositary hereunder.
“Consolidated Adjusted Net Income” means, for any period, the Parent Guarantor’s and the Restricted Subsidiaries’ consolidated net income (or loss) for such period as determined in accordance with IFRS, adjusted by excluding (to the extent included in such consolidated net income or loss), without duplication:
(a)any net after-tax extraordinary gains or losses;
(b)any net after-tax gains or losses attributable to sales of assets of the Parent Guarantor or any Restricted Subsidiary that are not sold in the ordinary course of business;
(c)the portion of net income or loss of any Person (other than the Parent Guarantor or a Restricted Subsidiary), including Unrestricted Subsidiaries, in which the Parent Guarantor or any Restricted Subsidiary has an equity ownership interest, except that the Parent Guarantor’s or a Restricted Subsidiary’s equity in the net income of such Person for such period shall be included in such Consolidated Adjusted Net Income to the extent of the aggregate amount of dividends or other distributions actually paid to the Parent Guarantor or any Restricted Subsidiary in cash dividends or other distributions during such period;
(d)the net income or loss of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary is not at the date of determination permitted, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Restricted Subsidiary or its shareholders (other than restrictions contained in the Credit Facilities and related agreements permitted by Section 4.06(b)(ii));
(e)any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves or provisions therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering or refinancing of debt or equity securities;
(f)the non-cash accounting effects of any acquisition, purchase, merger, reorganization or other similar transaction, including any increase in amortization or depreciation resulting from adjustments to tangible or intangible assets, the consequence of any revaluation of inventory or other non-cash charges or effects (including losses on derivatives);
(g)the cumulative effect of a change in accounting principles after the Issue Date;
(h)any charge or expense recorded for non-cash or capitalized interest on Deeply Subordinated Funding;
(i)net after tax gains or losses attributable to (i) the termination of pension plans, (ii) the acquisition of securities or the extinguishment of debt or (iii) currency exchange transactions that are not in the ordinary course of business;
(j)net income or loss attributable to discontinued operations; and
(k)any restoration to net income of any contingency reserve, except to the extent it was provided for in a prior period.
“Consolidated Fixed Charge Coverage Ratio” of the Parent Guarantor means, for any period, the ratio of:
(a)the sum of Consolidated Adjusted Net Income, plus in each case to the extent deducted in computing Consolidated Adjusted Net Income for such period:
(i)Consolidated Net Interest Expense;
(ii)Consolidated Tax Expense; and
(iii)Consolidated Non-cash Charges, less all non-cash items increasing Consolidated Adjusted Net Income for such period and less all cash payments during such period relating to non-cash charges that were added back to Consolidated Adjusted Net Income in determining the Consolidated Fixed Charge Coverage Ratio in any prior period;
(b)to the sum of:
(i)Consolidated Net Interest Expense; and
(ii)cash and non-cash dividends due (whether or not declared) on the Parent Guarantor’s and any Restricted Subsidiary’s Preferred Stock (to any Person other than the Parent Guarantor and any Wholly Owned Restricted Subsidiary), in each case for such period;
provided that in calculating the Consolidated Fixed Charge Coverage Ratio or any element thereof for any period, pro forma effect will be given to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation;
provided, further, without limiting the application of the previous proviso, that:
(w)if the Parent Guarantor or any Restricted Subsidiary has incurred any Debt since the beginning of such period that remains outstanding or if the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio is an incurrence of Debt or both, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Debt as if such Debt had been incurred on the first day of such period and the discharge of any other Debt repaid, repurchased, defeased or otherwise discharged with the proceeds of such new Debt as if such discharge had occurred on the first day of such period;
(x)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary shall have made any Asset Sale, Consolidated Adjusted Net Income for such period shall be reduced by an amount equal to the Consolidated Adjusted Net Income (if positive) directly attributable to the assets which are the subject of such Asset Sale for such period, or increased by an amount equal to the Consolidated Adjusted Net Income (if negative) directly attributable thereto, for such period and the Consolidated Net Interest Expense for such period shall be reduced by an amount equal to the Consolidated Net Interest Expense directly attributable to any Debt of the Parent Guarantor or of any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to the Parent Guarantor and the continuing Restricted Subsidiaries in connection with such Asset Sale for such period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated Net Interest Expense for such period directly attributable to the Debt of such Restricted Subsidiary to the extent the Parent Guarantor and the continuing Restricted Subsidiaries are no longer liable for such Debt after such sale);
(y)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of an asset occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the incurrence of any Debt) as if such Investment or acquisition occurred on the first day of such period; and
(z)if, since the beginning of such period, any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Parent Guarantor or any Restricted Subsidiary since the beginning of such period) shall have made any Asset Sale or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (x) or (y) above if made by the Parent Guarantor or a Restricted Subsidiary during such period, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Asset Sale or Investment or acquisition occurred on the first day of such period.
If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt for a period equal to the remaining term of such Interest Rate Agreement).
“Consolidated Leverage Ratio” of the Parent Guarantor means, as of the date of determination, the ratio of (a)(i) the sum of consolidated Debt of the Parent Guarantor (other than working capital) less (ii) cash and Cash Equivalents on the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19 to (b) the aggregate consolidated EBITDA of the Parent Guarantor for the period of the most recent four consecutive quarters for which financial statements are available under Section 4.19, in each case with such pro forma adjustments to consolidated Debt and consolidated EBITDA as are appropriate and consistent with the pro forma provisions set forth in the definition of “Consolidated Fixed Charge Coverage Ratio.”
“Consolidated Net Interest Expense” means, for any period, without duplication and in each case determined on a consolidated basis in accordance with IFRS, the sum of:
(a)the Parent Guarantor’s and the Restricted Subsidiaries’ total interest expense for such period, including, without limitation:
(i)amortization of debt discount;
(ii)the net costs of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements (including amortization of fees and discounts);
(iii)commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and similar transactions; and
(iv)the interest portion of any deferred payment obligation and amortization of debt issuance costs; plus
(b)the interest component of the Parent Guarantor’s and the Restricted Subsidiaries’ Capitalized Lease Obligations accrued and/or scheduled to be paid or accrued during such period other than the interest component of Capitalized Lease Obligations between or among the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; plus
(c)the Parent Guarantor’s and the Restricted Subsidiaries non-cash interest expenses and interest that was capitalized during such period; plus
(d)the interest expense on Debt of another Person to the extent such Debt is guaranteed by the Parent Guarantor or any Restricted Subsidiary or secured by a Lien on the Parent
Guarantor’s or any Restricted Subsidiary’s assets, but only to the extent that such interest is actually paid by the Parent Guarantor or such Restricted Subsidiary; minus
(e)the interest income of the Parent Guarantor and the Restricted Subsidiaries during such period.
Notwithstanding any of the foregoing, Consolidated Net Interest Expense shall not include any of the following:
(a)interest accrued, capitalized or paid in respect of Deeply Subordinated Funding;
(b)gains, losses, expenses or charges associated with refinancing of debt;
(c)gains, losses, expenses or charges associated with the total or partial extinguishment of debt;
(d)gains, losses, expenses or charges resulting from “mark to market” provisions or fair value charges applied to or resulting from derivatives; or
(e)any non-cash pension expense.
“Consolidated Non-cash Charges” means, for any period, the aggregate depreciation, amortization and other non-cash expenses of the Parent Guarantor and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS (excluding any such non-cash charge that requires an accrual of or reserve for cash charges for any future period).
“Consolidated Tax Expense” means, for any period with respect to any Relevant Taxing Jurisdiction, the provision for all national, local and foreign federal, state or other income taxes of the Parent Guarantor and the Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with IFRS.
“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
“Contribution Debt” means Debt of the Parent Guarantor or any Restricted Subsidiary in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions and any such cash contributions that have been used to make a Restricted Payment or a Permitted Investment) made to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case, after the Issue Date, provided that (without prejudice to the rights of the Parent Guarantor and the Restricted Subsidiaries, including the right to divide and/or classify and/or reclassify as described in Section 4.06) such Contribution Debt is so designated as Contribution Debt pursuant to an Officer’s Certificate on the Incurrence date thereof.
“Credit Facility” or “Credit Facilities” means one or more debt facilities, indentures or other arrangements with banks, insurance companies, other financial institutions or investors providing for revolving credit loans, term loans, notes, receivables financings, letters of credit or other forms of guarantees and assurances, or other Debt, including overdrafts, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, repaid or refinanced (and whether in whole or in part and whether or not with the original administrative agent or lenders or another administrative agent or agents or other
bank or institutions and whether provided under one or more other credit or other agreements, indentures, financing agreements or otherwise) and, for the avoidance of doubt, includes any agreement extending the maturity of, refinancing or restructuring all or any portion of the indebtedness under such agreements or any successor agreements.
“Currency Agreements” means, in respect of a Person, any spot or forward foreign exchange agreements and currency swap, currency option or other similar financial agreements or arrangements designed to protect such Person against or manage exposure to fluctuations in foreign currency exchange rates.
“Custodian” means any receiver, trustee, assignee, liquidator, custodian, administrator or similar official under any Bankruptcy Law.
“Debt” means, with respect to any Person, without duplication:
(a)all liabilities of such Person for borrowed money (including overdrafts) or for the deferred purchase price of property or services, excluding any trade payables and other accrued current liabilities Incurred in the ordinary course of business;
(b)all obligations of such Person evidenced by bonds, notes, debentures or other similar instruments;
(c)all obligations, contingent or otherwise, of such Person in connection with any letters of credit, bankers’ acceptances, receivables facilities or other similar facilities;
(d)all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even if the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade payables arising in the ordinary course of business;
(e)all Capitalized Lease Obligations of such Person;
(f)all obligations of such Person under or in respect of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements; and
(g)all Redeemable Capital Stock of such Person valued at the greater of its voluntary maximum fixed repurchase price and involuntary maximum fixed repurchase price plus accrued and unpaid dividends;
if and to the extent any of the preceding items would appear as debt on a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS; provided that the term “Debt” shall not include (i) non-interest bearing installment obligations and accrued liabilities Incurred in the ordinary course of business that are not more than 90 days past due; (ii) Debt in respect of the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of standby letters of credit, performance bonds or surety bonds provided by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business to the extent such letters of credit or bonds are not drawn upon or, if and to the extent drawn upon are honored in accordance with their terms and if, to be reimbursed, are reimbursed no later than the fifth Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit or bond; (iii) anything accounted for as an operating lease in accordance with IFRS as at the Issue Date; (iv) any pension obligations of the Parent Guarantor or a Restricted
Subsidiary; (v) Debt Incurred by the Parent Guarantor or one of the Restricted Subsidiaries in connection with a transaction where (x) such Debt is borrowed from a bank or trust company having a combined capital and surplus and undivided profits of not less than €500 million, whose debt has a rating immediately prior to the time such transaction is entered into, of at least A or the equivalent thereof by S&P and A2 or the equivalent thereof by Moody’s and (y) a substantially concurrent Investment is made by the Parent Guarantor or a Restricted Subsidiary in the form of cash deposited with the lender of such Debt, or a Subsidiary or Affiliate thereof, in amount equal to such Debt; and (vi) Deeply Subordinated Funding. In addition, “Debt” of the specified Person shall include all Debt of another Person secured by a Lien on any asset of the specified Person (whether or not such Debt is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of Debt of another Person, and Preferred Stock of any Restricted Subsidiary.
For purposes of this definition, the “maximum fixed repurchase price” of any Redeemable Capital Stock that does not have a fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Redeemable Capital Stock as if such Redeemable Capital Stock were purchased on any date on which Debt will be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the Fair Market Value of such Redeemable Capital Stock, such Fair Market Value will be determined in good faith by the board of directors of the issuer of such Redeemable Capital Stock; provided, that if such Redeemable Capital Stock is not then permitted to be redeemed, repaid or repurchased, the redemption, repayment or repurchase price shall be the book value of such Redeemable Capital Stock as reflected in the most recent financial statements of such Person.
“Deeply Subordinated Funding” means any funds provided to the Parent Guarantor pursuant to an agreement, note, security or other instrument, other than Capital Stock, that (i) is subordinated in right of payment to all Debt of the Parent Guarantor, (ii) (A) does not mature or require any amortization, redemption or other repayment of principal, (B) does not require payment of any cash interest or any similar cash amounts, and (C) contains no change of control or similar provisions and does not accelerate and has no right to declare a default or event of default or take any enforcement action or otherwise require any cash payment (other than as a result of insolvency proceedings of the Parent Guarantor), in each case prior to the 90th day following the repayment in full of the Notes and all other amounts due under this Indenture, (iii) does not provide for or require any security interest or encumbrance over any asset of the Parent Guarantor or any Restricted Subsidiary and (iv) does not contain any covenants (financial or otherwise) other than a covenant to pay such Deeply Subordinated Funding.
“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.
“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Parent Guarantor or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, executed by the principal financial officer of the Parent Guarantor, less the amount of Cash Equivalents received in connection with a subsequent sale, redemption, repurchase of, or collection or payment on, such Designated Non-cash Consideration.
“Designated Senior Debt” means (a) any Debt outstanding under the Senior Credit Facilities and the Existing Secured Notes and (b) any other Senior Debt permitted under this Indenture the principal amount of which is €30,000,000 or more as of the date of determination and that has been designated by the Issuers, the Parent Guarantor or the relevant Restricted Subsidiary as “Designated Senior Debt”.
“Disinterested Director” means, with respect to any transaction or series of related transactions, a member of the Parent Guarantor’s board of directors who does not have any material direct or indirect financial interest in or with respect to such transaction or series of related transactions or is not an Affiliate, or an officer, director or employee of any Person (other than the Parent Guarantor or any Restricted Subsidiary) who has any direct or indirect financial interest in or with respect to such transaction or series of related transactions; provided that no member of the Parent Guarantor’s board of directors shall be deemed to have any such direct or indirect financial interest solely as a result of such member’s ownership of the Parent Guarantor or any successor or any company holding shares, directly or indirectly, in the Parent Guarantor or such member’s serving on the board of directors of any company holding shares, directly or indirectly, in the Parent Guarantor.
“Enforcement Action” means, in relation to any Debt of a Subsidiary Guarantor, any action (whether taken by the relevant creditor or creditors or an agent or trustee on its or their behalf) to:
(a)demand payment, declare prematurely due and payable or otherwise seek to accelerate payment of all or any part of such Debt;
(b)recover all or any part of such Debt (including, by exercising any rights of set-off or combination of accounts);
(c)exercise or enforce any rights under or pursuant to any guarantee or other assurance given by such Subsidiary Guarantor in respect of such Debt;
(d)exercise or enforce any rights under any security interest whatsoever which secures such Debt;
(e)commence legal proceedings against any Person; or
(f)commence, or take any other steps which could lead to the commencement of:
(i)any insolvency, liquidation, dissolution, winding-up, administration, receivership, compulsory merger or judicial re-organization of any Person;
(ii)the appointment of a trustee in bankruptcy, or insolvency conciliator, ad hoc official, judicial administrator, a liquidator or other similar officer in respect of any Person; or
(iii)any other similar process or appointment.
“Equity and Asset Purchase Agreement” means the definitive equity and asset purchase agreement in relation to the Acquisition as amended, modified or supplemented from time to time, together with all exhibits, schedules, annexes and other documents related thereto.
“euro” or “€” means the lawful currency of the member states of the European Union who have agreed to share a common currency in accordance with the provisions of the Maastricht Treaty dealing with European monetary union.
“Euroclear” means Euroclear SA/NV or any successor thereof.
“Euro Equivalent” means, with respect to any monetary amount in a currency other than euro, at any time for the determination thereof, the amount of euro obtained by converting such foreign currency
involved in such computation into euro at the spot rate for the purchase of euro with the applicable foreign currency as published under “Currency Rates” in the section of the Financial Times entitled “Currencies, Bonds & Interest Rates” on the date that is two Business Days prior to such determination.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Excluded Contribution” means Net Cash Proceeds or property or assets received by the Parent Guarantor as capital contributions (other than Contribution Debt and any contributions used to make a Restricted Payment or a Permitted Investment) to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case, after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary or an employee stock ownership plan or trust established by the Parent Guarantor or any Subsidiary of the Parent Guarantor for the benefit of its employees to the extent funded by the Parent Guarantor or any Restricted Subsidiary) of Capital Stock (other than Redeemable Capital Stock) of the Parent Guarantor, in each case, to the extent designated as an Excluded Contribution pursuant to an Officer’s Certificate of the Parent Guarantor.
“Excluded Group” means the Ardagh Group S.A., Ardagh Packaging Group Limited and Ardagh Packaging Group Holdings Limited.
“Existing Ardagh Bonds” means (i) the Existing Secured Notes and (ii) the Existing Unsecured Notes and any other international debt securities of the Parent Guarantor or any of its Restricted Subsidiaries outstanding on the Issue Date.
“Existing Debt” means all Debt of the Parent Guarantor and its Restricted Subsidiaries outstanding on the Issue Date after giving effect to the issue of the Notes and the use of proceeds therefrom.
“Existing Secured Notes” means the July 2014 Secured Notes, the May 2016 Secured Notes and the March 2017 Secured Notes.
“Existing Unsecured Notes” means the July 2014 Senior Notes, the May 2016 Senior Notes and the January 2017 Senior Notes.
“Fair Market Value” means, with respect to any asset or property, the sale value that would be obtained in an arm’s-length free market 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 Parent Guarantor’s board of directors.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in section 1471(b) of the Code, or otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, or any law implementing an intergovernmental approach thereto.
“Gilt Rate” means, with respect to any redemption date, the yield to maturity as of such redemption date of U.K. Government Securities with a fixed maturity (as compiled by the Office for National Statistics and published in the most recent Financial Statistics that have become publicly available at least two Business Days in London prior to such redemption date (or, if such Financial Statistics are no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to July 15, 2022; provided, however, that if the period from such redemption date to July
15, 2022 is less than one year, the weekly average yield on actually traded U.K. Government Securities denominated in sterling adjusted to a fixed maturity of one year shall be used.
“Guarantee” means any guarantee of the Issuers’ obligations under this Indenture and the Notes by the Parent Guarantor, any Restricted Subsidiary or any other Person in accordance with the provisions of this Indenture, including the Guarantees by the Guarantors dated as of the Issue Date. When used as a verb, “Guarantee” shall have a corresponding meaning.
“guarantees” means, as applied to any obligation,
(a)a guarantee (other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business), direct or indirect, in any manner, of any part or all of such obligation; and
(b)an agreement, direct or indirect, contingent or otherwise, the practical effect of which is to assure in any way the payment or performance (or payment of damages in the event of non-performance) of all or any part of such obligation, including, without limiting the foregoing, by the pledge of assets and the payment of amounts drawn down under letters of credit.
“Guarantor” means the Parent Guarantor and the Subsidiary Guarantors, together, and any other Person that is a guarantor of the Notes, including any Person that is required after the Issue Date to execute a guarantee of the Notes pursuant to Section 4.14 or Section 4.15 until a successor replaces such party pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such successor.
“Holder” means the Person in whose name a Note is registered on the Registrar’s books.
“IFRS” means International Financial Reporting Standards as adopted by the European Union, as in effect from time to time.
“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof.
“Incremental Facility” means the incremental facilities under the Term Loan Facilities Credit Agreement.
“Intercreditor Agreement” means the Intercreditor Agreement entered into on December 7, 2010, as amended and restated most recently on March 21, 2017 and from time to time among, inter alia, Ardagh Packaging Finance Plc, Ardagh Packaging Holdings Limited and Citibank, N.A., London Branch in its capacity as security agent thereunder and trustee for the Existing Secured Notes, and to which the Trustee will accede as soon as reasonably practicable.
“Interest Payment Date” means the Stated Maturity of an installment of interest on the Notes.
“Interest Rate Agreements” means, in respect of a Person, any interest rate protection agreements and other types of interest rate hedging agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements) designed to protect such Person against or manage exposure to fluctuations in interest rates.
“Investment” means, with respect to any Person, any direct or indirect advance, loan or other extension of credit (including guarantees) or capital contribution to (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 others), or any purchase, acquisition or ownership by such Person of any Capital Stock, bonds, notes, debentures or other securities or evidences of Debt issued or owned by, any other Person and all other items that would be classified as investments on a balance sheet prepared in accordance with IFRS. In addition, the portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary will be deemed to be an “Investment” that the Parent Guarantor made in such Unrestricted Subsidiary at such time. The portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Unrestricted Subsidiary at the time that such Unrestricted Subsidiary is designated a Restricted Subsidiary will be considered a reduction in outstanding Investments. “Investments” excludes extensions of trade credit on commercially reasonable terms in accordance with normal trade practices.
“Investment Grade Status” shall occur when the Notes receive both of the following:
(1) a rating of “BBB-” or higher from S&P; and
(2) a rating of “Baa3” or higher from Moody’s;
or the equivalent of such rating by either such rating organization or, if no rating of Moody’s or S&P then exists, the equivalent of such rating by any other Nationally Recognized Statistical Rating Organization.
“Issue Date” means June 12, 2017.
“Issuers Order” means a written order signed in the name of the Issuers by any Person authorized by a resolution of the board of directors of each Issuer.
“January 2017 Senior Notes” means the existing $1,000,000,000 aggregate principal amount of 6.000% Senior Notes and $700,000,000 aggregate principal amount of 6.000% additional Senior Notes due 2025 issued by the Issuers.
“July 2014 Secured Notes” means the existing €405,000,000 aggregate principal amount of 4.250% First Priority Senior Secured Notes due 2022.
“July 2014 Senior Notes” means the existing $440,000,000 aggregate principal amount of 6.000% Senior Notes due 2021.
“Lien” means any mortgage or deed of trust, charge, pledge, lien (statutory or otherwise), privilege, security interest, hypothecation, assignment for security, standard security, assignation in security claim, or preference or priority or other encumbrance upon or with respect to any property of any kind, real or personal, movable or immovable, now owned or hereafter acquired. A Person shall be deemed to own subject to a Lien any property which such Person has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement.
“March 2017 Secured Notes” means the existing $715,000,000 aggregate principal amount of 4.250% Senior Secured Notes due 2022 and the €750,000,000 aggregate principal amount of 2.750% Senior Secured Notes due 2024 issued by the Issuers on March 8, 2017.
“Material Subsidiary” means any Restricted Subsidiary that represents 5% or more of the Total Assets or consolidated EBITDA of the Parent Guarantor, measured, in the case of Total Assets, as of the last day of the most recent fiscal quarter for which financial statements are available, and in the case of consolidated EBITDA, for the four fiscal quarters ended most recently for which financial statements are available.
“Maturity” means, with respect to any indebtedness, the date on which any principal of such indebtedness becomes due and payable as therein or herein provided, whether at the Stated Maturity with respect to such principal or by declaration of acceleration, call for redemption or purchase or otherwise.
“May 2016 Secured Notes” means the existing $500,000,000 aggregate principal amount of Floating Rate Notes due 2021, the existing €440,000,000 aggregate principal amount of 4.125% Senior Secured Notes due 2023 and the existing $1,000,000,000 aggregate principal amount of 4.625% Senior Secured Notes due 2023 issued by the Issuers on May 16, 2016.
“May 2016 Senior Notes” means the existing €750,000,000 aggregate principal amount of 6.750% Senior Notes due 2024 and the existing $1,650,000,000 aggregate principal amount of 7.250% Senior Notes due 2024 issued by the Issuers on May 16, 2016.
“Moody’s” means Moody’s Investors Service, Inc. and its successors.
“Nationally Recognized Statistical Rating Organization” means a nationally recognized statistical rating organization within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act.
“Net Cash Proceeds” means:
(a)with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents including (x) payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor or any Restricted Subsidiary) and (y) any cash or Cash Equivalents received upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale, net of:
(i)brokerage commissions and other fees and expenses (including, without limitation, fees and expenses of legal counsel, accountants, investment banks and other consultants) related to such Asset Sale;
(ii)provisions for all taxes paid or payable, or required to be accrued as a liability under IFRS as a result of such Asset Sale;
(iii)all distributions and other payments required to be made to any Person (other than the Parent Guarantor or any Restricted Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale; and
(iv)appropriate amounts required to be provided by the Parent Guarantor or any Restricted Subsidiary, as the case may be, as a reserve in accordance with IFRS against any liabilities associated with such Asset Sale and retained by the Parent Guarantor or any Restricted Subsidiary, 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, all as reflected in an Officer’s Certificate delivered to the Trustee; and
(b)with respect to any capital contributions, issuance or sale of Capital Stock or options, warrants or rights to purchase Capital Stock, or debt securities or Capital Stock that have been converted into or exchanged for Capital Stock as referred to in Section 4.08, the proceeds of such issuance or sale in the form of cash or Cash Equivalents, payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed of for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor or any Restricted Subsidiary), net of attorney’s fees, accountant’s fees and brokerage, consultation, underwriting and other fees and expenses actually Incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.
“Offering Memorandum” means the confidential offering memorandum of the Issuers, dated June 2, 2017, relating to the Notes.
“Officer’s Certificate” means a certificate signed by an officer of the Parent Guarantor, of either Issuer, a Guarantor or a Surviving Entity, as the case may be, and delivered to the Trustee.
“Opinion of Counsel” means a written opinion from legal counsel. The counsel may be an employee of or counsel to the Issuers.
“Pari Passu Debt” means (a) any Debt of the applicable Issuer that ranks equally in right of payment with the Notes or (b) with respect to any Guarantee, any Debt that ranks equally in right of payment to such Guarantee.
“Parties” means the Issuers, the Parent Guarantor, the Trustee, the Principal Paying Agent and any other party from time to time hereto (each, a “Party”).
“Permitted Debt” has the meaning given to such term under Section 4.06(b).
“Permitted Holders” means (a) Yeoman Capital S.A., (b) any of Paul Coulson, Brendan Dowling, Houghton Fry, Edward Kilty, John Riordan or Niall Wall, and any trust created for the benefit of one or more of the foregoing or their respective natural person Affiliates, or the estate, executor, administrator, committee or beneficiaries of any thereof and (c) any of their respective Affiliates.
“Permitted Investments” means any of the following:
(a)Investments in cash or Cash Equivalents;
(b)intercompany Debt to the extent permitted under clause (iv) of the definition of “Permitted Debt”;
(c)Investments in (i) the form of loans borrowed by or advances to, or debt securities issued by, the Parent Guarantor, (ii) a Restricted Subsidiary or (iii) another Person if as a result of such Investment such other Person becomes a Restricted Subsidiary or such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, the Parent Guarantor or a Restricted Subsidiary;
(d)Investments made by the Parent Guarantor or any Restricted Subsidiary as a result of or retained in connection with an Asset Sale that does not violate Section 4.09;
(e)expenses or advances to cover payroll, travel, entertainment, moving, other relocation and similar matters;
(f)Investments in the Notes and the Existing Ardagh Bonds;
(g)Investments existing at the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on, or made pursuant to a binding commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased as required by the terms of such Investment existing on the Issue Date;
(h)Investments in Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements permitted under clauses (b)(viii), (b)(ix) and (b)(x) of Section 4.06;
(i)Investments made in the ordinary course of business, the Fair Market Value of which in the aggregate does not exceed €10,000,000 in any transaction or series of related transactions;
(j)loans and advances (or guarantees to third‑party loans) to directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary made in the ordinary course of business and consistent with the Parent Guarantor’s past practices or past practices of the Restricted Subsidiaries, as the case may be, in an amount outstanding not to exceed at any one time €20,000,000;
(k)Investments in a Person to the extent that the consideration therefor consists of the issue and sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding or the net proceeds thereof (other than any Excluded Contribution or the proceeds of any Contribution Debt); provided that the net proceeds of such sale have been excluded from, and shall not have been included in, the calculation of the amount determined under clause (b)(iii)(B) of Section 4.08;
(l)pledges or deposits with respect to leases or utilities provided to third parties in the ordinary course of business;
(m)Investments of the Parent Guarantor or the Restricted Subsidiaries described under item (v) to the proviso to the definition of “Debt”;
(n)Investments, the amount of which, measured by reference to the Fair Market Value of each such Investment on the date it was made, not to exceed the sum of (x) the greater of €160,000,000 and 2.0% of Total Assets in the aggregate outstanding at any one time and (y) the sum of (i) the aggregate net after-tax amount returned in cash or through interest payments, principal payments, dividends or other distributions or payments on account of such Investment and (ii) the net after-tax cash proceeds received by the Parent Guarantor or any Restricted Subsidiary from the disposition of all or any portion of such Investments (other than to a Subsidiary); provided, however, that such net after-tax amounts have not been included in Consolidated Adjusted Net Income for the purpose of calculating clause (b)(iii)(A) of Section 4.08;
(o)Investments resulting from the acquisition of a Person that at the time of such acquisition held instruments constituting Investments that were not acquired in contemplation of the acquisition of such Person;
(p)Investments by the Parent Guarantor or any Restricted Subsidiary in connection with a Permitted Receivables Financing;
(q)loans or advances to (i) directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof pursuant to management equity plans or similar management or employee benefit arrangement or (ii) stock option plans, trust and similar asset pools to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof not to exceed €20,000,000 in the aggregate outstanding at any one time;
(r)(i) stock, obligations or securities received in satisfaction of judgments, foreclosure of liens, or settlement of debts or arbitration awards, and (ii) any Investments received in compromise of obligations of such persons Incurred in the ordinary course of trade creditors or customers that were Incurred in the ordinary course of business, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer;
(s)any Investments received in comprise or resolution of litigation, arbitration or other disputes;
(t)any guarantee of Debt permitted to be incurred by Section 4.06, performance guarantees and contingent obligations incurred in the ordinary course of business and creation of Liens on the assets of the Parent Guarantor or any Restricted Subsidiary in compliance with Section 4.07;
(u)any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with the provisions of Section 4.10(b) (except transactions described in clauses (b)(ii), (v) and (x) thereof);
(v)advances, loans, rebates and extensions of credit (including the creation of receivables) to suppliers, customers and vendors, and advance payment made and deferred consideration and performance guarantees, in each case in the ordinary course of business; and
(w)any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business.
“Permitted Joint Venture” means any joint venture or similar combinations or other transaction pursuant to which the Parent Guarantor or any Restricted Subsidiary enters into, acquires or subscribes for any shares, stock, securities or other interest in or transfers any assets to any joint venture; provided, however, that the primary business of such joint venture is a Similar Business.
“Permitted Junior Securities” means, with respect to a Subsidiary Guarantor: (a) Capital Stock in such Subsidiary Guarantor or (b) debt securities of the Subsidiary Guarantor that are subordinated to all
Senior Debt and any debt securities issued in exchange for Senior Debt to substantially the same extent as, or to a greater extent than, the Notes are subordinated to Senior Debt pursuant to this Indenture.
“Permitted Liens” means the following types of Liens:
(a)Liens existing as of the Issue Date;
(b)Liens (i) securing Debt under Credit Facilities and any other Senior Debt permitted to be Incurred pursuant to Section 4.06 and (ii) Liens on any property or assets of the Parent Guarantor or a Restricted Subsidiary to secure Debt permitted to be Incurred pursuant to clause (b)(ii) of Section 4.06;
(c)Liens on assets given, disposed of, or otherwise transferred in connection with a Permitted Receivables Financing permitted to be Incurred pursuant to clause (b)(xiii) of Section 4.06;
(d)Liens on any property or assets of a Restricted Subsidiary granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(e)Liens on any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets securing the Notes or any Guarantees;
(f)any interest or title of a lessor under any Capitalized Lease Obligation and Liens to secure Debt (including Capitalized Lease Obligations) permitted under Section 4.06 covering only the assets acquired with such Debt;
(g)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business;
(h)statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen, employees, pension plan administrators or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings or Liens arising solely by virtue of any statutory or common law provisions relating to attorney’s liens or bankers’ liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depositary institution;
(i)Liens for taxes, assessments, government charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings for which a reserve or other appropriate provision, if any, as shall be required in conformity with IFRS shall have been made;
(j)Liens Incurred or deposits made to secure the performance of tenders, bids or trade or government contracts, or to secure leases, statutory or regulatory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature Incurred in the ordinary course of business (other than obligations for the payment of money);
(k)zoning restrictions, easements, licenses, reservations, title defects, rights of others for rights-of-way, utilities, sewers, electrical lines, telephone lines, telegraph wires, restrictions, encroachments and other similar charges, encumbrances or title defects and Incurred in the ordinary course of business that do not in the aggregate materially interfere
with in any material respect the ordinary conduct of the business of the Parent Guarantor and its Restricted Subsidiaries on the properties subject thereto, taken as a whole;
(l)Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
(m)Liens on property existing at the time such property is acquired or on property of, or on shares of Capital Stock or Debt of, any Person existing at the time such Person is acquired by, merged with or into or consolidated with, the Parent Guarantor or any Restricted Subsidiary; provided that such Liens (i) do not extend to or cover any property or assets of the Parent Guarantor or any Restricted Subsidiary other than (A) the property or assets acquired or (B) the property or assets of the Person acquired, merged with or into or consolidated with the Parent Guarantor or Restricted Subsidiary and (ii) were created prior to, and not in connection with or in contemplation of such acquisition, merger or consolidation;
(n)Liens securing the Parent Guarantor’s or any Restricted Subsidiary’s obligations under Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements permitted under sub-clauses (viii), (ix) and (x) of Section 4.06(b) or any collateral for the Debt to which such Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements relate;
(o)Liens Incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or other insurance (including unemployment insurance) or deposits to secure public or statutory obligations of such Person or deposits of cash or government bonds to secure performance, bid, surety or appeal bonds and completion bonds and guarantees to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;
(p)Liens Incurred in connection with a cash management program established in the ordinary course of business;
(q)Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Parent Guarantor or any Restricted Subsidiary, including rights of offset and set-off;
(r)any extension, renewal or replacement, in whole or in part, of any Permitted Lien; provided that any such extension, renewal or replacement shall not extend in any material respect to any additional property or assets;
(s)Liens securing Debt Incurred to refinance Permitted Refinancing Debt permitted to be incurred under the Secured Indenture; provided that any such Lien shall not extend to or cover materially any assets not securing the Debt so refinanced plus improvements and accessions to such property and assets and proceeds and distributions thereof;
(t)purchase money Liens to finance property or assets of the Parent Guarantor or any Restricted Subsidiary acquired in the ordinary course of business; provided that the related
purchase money Debt shall not exceed the cost of such property or assets and shall not be secured by any property or assets of the Parent Guarantor or any Restricted Subsidiary other than the property and assets so acquired;
(u)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;
(v)Liens over the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture that secure Debt of such Unrestricted Subsidiary or Permitted Joint Venture;
(w)Liens Incurred in the ordinary course of business of the Parent Guarantor or any Restricted Subsidiary with respect to an amount that does not exceed the greater of €115,000,000 and 1.5% of Total Assets at any one time outstanding and any replacements, extensions, modifications or renewals thereof;
(x)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created in the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(y)leases, licenses, subleases and sublicenses of assets in the ordinary course of business;
(z)Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third-party relating to such property or assets;
(aa) Liens on equipment of the Issuer or any Restricted Subsidiary granted in the ordinary course of business;
(bb)customary Liens on and in respect of deposits required in connection with the purchase of property, equipment and inventory, in each case incurred in the ordinary course of business; and
(cc)(i) Liens on escrowed proceeds for the benefit of the related holders of debt securities or other Debt (or the underwriters or arrangers thereof) or (ii) Liens on cash set aside at the time of the incurrence of any Debt or government securities purchased with such cash, in either case, to the extent such cash or government securities prefund the payment of interest on such Debt and are held in escrow accounts or similar arrangements to be applied for such purpose.
“Permitted Receivables Financing” means any financing pursuant to which the Parent Guarantor or any Restricted Subsidiary may sell, convey or otherwise transfer to any other Person or grant a security interest in, any accounts receivable (and related assets) in an aggregate principal amount equivalent to the Fair Market Value of such accounts receivable (and related assets) of the Parent Guarantor or any Restricted Subsidiary; provided that (a) the covenants, events of default and other provisions applicable to such financing shall be customary for such transactions and shall be on market terms (as determined in good faith by the Parent Guarantor’s board of directors) at the time such financing is entered into, (b) the interest rate applicable to such financing shall be a market interest rate (as determined in good faith by the Parent Guarantor’s board of directors) at the time such financing is entered into, and (c) such financing shall be
non-recourse to the Parent Guarantor or any Restricted Subsidiary except to a limited extent customary for such transactions.
“Permitted Refinancing Debt” means any renewals, extensions, substitutions, refinancings or replacements (each, for purposes of this definition and clause (b)(xiv) of Section 4.06, a “refinancing”) of any Debt of the Parent Guarantor or a Restricted Subsidiary or pursuant to this definition, including any successive refinancings, so long as:
(a)such Debt is in an aggregate principal amount (or if Incurred with original issue discount, an aggregate issue price) not in excess of the sum of (i) the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being refinanced and (ii) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, related to such refinancing;
(b)the Average Life of such Debt is equal to or greater than the Average Life of the Debt being refinanced;
(c)the Stated Maturity of such Debt is no earlier than the Stated Maturity of the Debt being refinanced;
(d)the new Debt is not senior in right of payment to the Debt that is being refinanced; and
(e)such Debt is unsecured or is secured by a Silent Second Lien, if the Debt being refinanced is unsecured.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, winding up or corporate reconstruction, directly or indirectly, in one or a series of related transactions involving the Parent Guarantor or any of its Restricted Subsidiaries (a “Reorganization”) that is made on a solvent basis; provided that any payments or assets distributed in connection with such Reorganization remain within the applicable Issuer and its Restricted Subsidiaries. For the avoidance of doubt, the term “Permitted Reorganization” shall include the closure of bank accounts and the conversion of debt instruments into Capital Stock or other equity instruments.
“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“pounds sterling” or “£” means the lawful currency of the United Kingdom.
“Preferred Stock” means, with respect to any Person, Capital Stock of any class or classes (however designated) of such Person which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over the Capital Stock of any other class of such Person whether now outstanding, or issued after the Issue Date, and including, without limitation, all classes and series of preferred or preference stock of such Person.
“pro forma” means, with respect to any calculation made or required to be made pursuant to the terms of this Indenture, a calculation made in good faith by a responsible financial or accounting officer of the Parent Guarantor; provided that any such calculation shall (x) give effect to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would
reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given, as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation and (y) eliminate any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves therefor) relating to, or directly or indirectly resulting from, or Incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering of debt or equity securities.
“Property” means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock, and other securities of, any other Person. For purposes of any calculation required pursuant to this Indenture, the value of any Property shall be its Fair Market Value.
“Public Equity Offering” means an offer and sale of Qualified Capital Stock that are listed on an international securities exchange or publicly offered (which shall include an offering pursuant to Rule 144A and/or Regulation S under the Securities Act to professional market investors or similar persons).
“QIB” means a “Qualified Institutional Buyer” as defined in Rule 144A.
“Qualified Capital Stock” of any Person means any and all Capital Stock of such Person other than Redeemable Capital Stock.
“Record Date” for the interest payable on any Interest Payment Date means January 1 or July 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.
“Redeemable Capital Stock” means any class or series of Capital Stock that, either by its terms, by the terms of any security into which it is convertible or exchangeable, or by contract or otherwise, is, or upon the happening of an event or passage of time would be, required to be redeemed prior to the final Stated Maturity of the Notes or is redeemable at the option of the holder thereof at any time prior to such final Stated Maturity (other than upon a Change of Control of the Parent Guarantor in circumstances in which the Holders would have similar rights), or is convertible into or exchangeable for debt securities at any time prior to such final Stated Maturity; provided that any Capital Stock that would constitute Qualified Capital Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of any “asset sale” or “change of control” occurring prior to the Stated Maturity of the Notes will not constitute Redeemable Capital Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Section 4.09 and Section 4.11 and such Capital Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Parent Guarantor’s or the Issuers’ repurchase of such Notes as are required to be repurchased pursuant to Section 4.09 and Section 4.11.
“Redemption Date” means, when used with respect to any Note to be redeemed, in whole or in part, the date fixed for such redemption by or pursuant to this Indenture.
“Redemption Price” means, when used with respect to any Note to be redeemed, the price at which it is to be redeemed pursuant to this Indenture.
“Refinance” means, with respect to any Debt, to amend, modify, extend, substitute, renew, replace, refund, prepay, repay, repurchase, redeem, defease or retire, or to issue other Debt, in exchange or replacement for, such Debt. “Refinanced” and “Refinancing” shall have correlative meanings.
“Regulation S” means Regulation S under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Replacement Assets” means properties and assets that replace the properties and assets that were the subject of an Asset Sale or properties and assets that are, or will be, used in the Parent Guarantor’s business or in that of the Restricted Subsidiaries or in Similar Business or any and all businesses that in the good faith judgment of the board of directors of the Parent Guarantor are reasonably related, and, in each case, any capital expenditure relating thereto.
“Restricted Investment” means any Investment other than a Permitted Investment.
“Restricted Subsidiary” means any Subsidiary of the Parent Guarantor other than an Unrestricted Subsidiary.
“Reversion Date” means, after the Notes have achieved Investment Grade Status, the date, if any, that such Notes shall cease to have such Investment Grade Status.
“Rule 144” means Rule 144 under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Rule 144A” means Rule 144A under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“S&P” means Standard and Poor’s Ratings Service, a division of The McGraw-Hill Companies, Inc. and its successors.
“Securities Act” means the U.S. Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Senior Agent” means any agent, trustee or successor agent or trustee appointed under any Senior Credit Facility or the Existing Secured Notes to which any Subsidiary Guarantor is a party or designated as “Senior Agent” in any instrument or document evidencing Senior Debt.
“Senior Debt” means:
(a)all Debt under any Credit Facility permitted to be Incurred under Section 4.06 and all Commodity Hedging Agreements, Currency Agreements and Interest Rate Agreements and other obligations with respect thereto;
(b)any other Debt permitted to be incurred by either Issuer, the Parent Guarantor or any Restricted Subsidiary that provides a Guarantee under the terms of this Indenture unless, with respect to such a Restricted Subsidiary, the instrument under which such Debt is incurred expressly provides that it is on a parity with or subordinated in right of payment to its Guarantee, as the case may be; and
(c)all obligations with respect to the items listed in the preceding clauses (a) and (b).
Notwithstanding anything to the contrary in the preceding, Senior Debt will not include:
(i)any liability for taxes owed or owing by the Issuers or the Guarantors;
(ii)any Debt that is Incurred in violation of this Indenture or the terms of the Notes, as the case may be; or
(iii)any trade payables.
“Senior Toggle Notes” means the existing €845,000,000 aggregate principal amount of 6.625% / 7.375% Senior Secured Toggle Notes due 2023 and $770,000,000 aggregate principal amount of 7.125% / 7.875% Senior Secured Toggle Notes due 2023 issued by ARD Finance S.A. and any replacements or refinancings thereof, directly or indirectly.
“Silent Second Liens” means Liens granted in favor of Debt (the “second priority Debt”) on property or assets of the Parent Guarantor or any of its Restricted Subsidiaries that:
(a)are by law or under the terms of an intercreditor agreement reasonably acceptable to the Trustee second in priority to first priority Liens on such property or assets; and
(b)are subject to arrangements in form and substance reasonably satisfactory to the Trustee which provide (x) that any payments on enforcement of the Liens in such property or assets (other than payments to the security agent, trustee, administrative agent or other representative of the holders of the second priority Debt) to the holders of the second priority Debt (or their representatives) will only be made once the Debt secured by the first priority Liens on such property or assets have been satisfied in full and (y) that the holders of the second priority Debt (and their representatives) will have no ability to cause the enforcement of, or direct the relevant security agent in the enforcement of, the Liens in such property or assets until the Debt secured by the first priority Liens on such property or assets have been satisfied in full.
“Similar Business” means any business, service or other activity engaged in by the Parent Guarantor or any Restricted Subsidiaries of the Parent Guarantor on the Issue Date and any business, service or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which the Parent Guarantor and the Restricted Subsidiaries are engaged on the Issue Date or any business that, in the good faith business judgment of the Parent Guarantor, constitutes a reasonable diversification of business conducted by the Parent Guarantor and its Subsidiaries.
“Stated Maturity” means, when used with respect to any note or any installment of interest thereon, the date specified in such note as the fixed date on which the principal of such note or such installment of interest, respectively, is due and payable, and, when used with respect to any other indebtedness, means the date specified in the instrument governing such indebtedness as the fixed date on which the principal of such indebtedness, or any installment of interest thereon, is due and payable.
“Subordinated Debt” means Debt of either Issuer or any of the Guarantors (other than the Existing Ardagh Bonds, the Incremental Facility and any Permitted Refinancing Debt in respect of the foregoing) that is subordinated in right of payment to the Notes or the Guarantees of such Guarantors, as the case may be; provided that no Debt shall be deemed to be subordinated in right of payment to any other Debt solely by virtue of being unsecured or by virtue of being secured on a junior Lien basis.
“Subsidiary” means, with respect to any Person:
(a)a corporation a majority of whose Voting Stock is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof; and
(b)any other Person (other than a corporation), including, without limitation, a partnership, limited liability company, business trust or joint venture, in which such Person, one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other Person performing similar functions).
“Subsidiary Guarantee” means any Guarantee given by a Subsidiary Guarantor.
“Subsidiary Guarantors” means any Restricted Subsidiary that provides a Guarantee, in each case until it is released from its obligations under its Guarantee and this Indenture in accordance with the terms of this Indenture.
"Substitution Date" means March 21, 2017.
“Term Loan Facilities Credit Agreement” means the credit agreement dated as of December 17, 2013, by and among, inter alios, Ardagh Holdings USA and Ardagh Packaging Finance S.A., as co-borrowers, the Parent Guarantor, as parent guarantor, the subsidiaries of the Parent Guarantor party thereto as subsidiary guarantors, the lenders from time to time party thereto, Citibank, N.A. as administrative agent and Citibank, N.A., London Branch, as security agent, in respect of the Term Loan Facilities and the Incremental Facility as amended or modified from time to time.
“Total Assets” means the consolidated total assets of the Parent Guarantor and its Restricted Subsidiaries as shown on the most recent consolidated balance sheet of the Parent Guarantor.
“Total Inventories” means, as of any date, the amount of raw materials, packaging materials, work-in-progress and finished goods of the Parent Guarantor and the Restricted Subsidiaries, net of any provisions in respect of the foregoing items, in each case as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Total Receivables” means, as of any date, (a) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries plus (b) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries that has been sold, conveyed or otherwise transferred in Permitted Receivables Financings and is outstanding in each case as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Trust Officer” means any officer within the agency and corporate trust group, division or section of the Trustee (however named, or any successor group of the Trustee) and also means, with respect to any particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“U.K. Government Securities” means direct obligations of, or obligations guaranteed by, the United Kingdom, and the payment for which the United Kingdom pledges its full faith and credit.
“Unrestricted Subsidiary” means:
(a)any Subsidiary of the Parent Guarantor that at the time of determination is an Unrestricted Subsidiary (as designated by the Parent Guarantor’s board of directors pursuant to Section 4.17); and
(b)any Subsidiary of an Unrestricted Subsidiary.
“U.S. dollar” or “$” means the lawful currency of the United States of America.
“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees (or Persons performing similar functions) of any Person (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency).
“Wholly Owned Restricted Subsidiary” means any Restricted Subsidiary, all of the outstanding Capital Stock (other than directors’ qualifying shares or shares of Restricted Subsidiaries required to be owned by third parties pursuant to applicable law) of which are owned by the Parent Guarantor or by one or more other Wholly Owned Restricted Subsidiaries or by the Parent Guarantor and one or more other Wholly Owned Restricted Subsidiaries.
Term |
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Defined in Section |
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“Acceptable Commitment” |
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4.09(b) |
“Additional Amounts”................................................... |
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4.12(a) |
“Additional Notes”....................................................... |
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Recitals |
“Additional Intercreditor Agreement”........................... |
|
4.13(a) |
“Agents”......................................................................... |
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2.03 |
“Applicable Procedures” |
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2.06(b)(ii) |
“Authorized Agent”....................................................... |
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12.08 |
“Change of Control Offer”............................................. |
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4.11(a) |
“Change of Control Purchase Date”............................... |
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4.11(a) |
“Change of Control Purchase Price”............................. |
|
4.11(a) |
“covenant defeasance”............................................... |
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8.03 |
“Defaulted Interest”................................................... |
|
2.12 |
“Notes”......................................................................... |
|
Recitals |
“Event of Default”....................................................... |
|
6.01(a) |
“Excess Proceeds”....................................................... |
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4.09(b) |
“Excess Proceeds Offer”............................................... |
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4.09(c) |
“Global Notes”........................................................... |
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2.01(c) |
“Holdings USA Disposition”......................................... |
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12.01(a) |
“Incur”......................................................................... |
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4.06(a) |
“Incurrence”............................................................... |
|
4.06(a) |
“Irish Issuer”............................................................... |
|
Preamble |
“Issuers”....................................................................... |
|
Preamble |
“legal defeasance”..................................................... |
|
8.02 |
“Notes”......................................................................... |
|
Recitals |
“Obligations”............................................................. |
|
10.01(a) |
“Original Notes”......................................................... |
|
Recitals |
Term |
|
Defined in Section |
“Parent Guarantor”..................................................... |
|
Preamble |
“Participants”............................................................. |
|
2.01(c) |
“Paying Agent”........................................................... |
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2.03 |
“Permitted Debt”....................................................... |
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4.06(b) |
“Principal Paying Agent”............................................. |
|
Preamble |
“Registrar”................................................................. |
|
2.03 |
“Regulation S Global Note”......................................... |
|
2.01(b) |
“Relevant Fiscal Year”................................................. |
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4.08(c)(xi) |
“Relevant Taxing Jurisdiction”..................................... |
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4.12(a) |
“Required Currency”................................................... |
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12.14 |
“Restricted Global Note”............................................. |
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2.01(b) |
“Restricted Payment”................................................. |
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4.08(a) |
“Security Register”..................................................... |
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2.03 |
“Standstill Period”....................................................... |
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10.01(d)(iii) |
“Successor Parent Guarantor” |
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5.01(c) |
“Surviving Entity”....................................................... |
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5.01(b)(i) |
“Suspension Event”..................................................... |
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4.22 |
“Taxes”......................................................................... |
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4.12(a) |
“Transfer Agent”......................................................... |
|
2.03 |
“Trustee”................................................................... |
|
Preamble |
“U.S. Issuer”............................................................... |
|
Preamble |
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(i) a term has the meaning assigned to it; |
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(ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS; |
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(iii) “or” is not exclusive; |
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(iv) “including” or “include” means including or include without limitation; |
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(v) words in the singular include the plural and words in the plural include the singular; |
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(vi) unsecured or unguaranteed Debt shall not be deemed to be subordinate or junior to secured or guaranteed Debt merely by virtue of its nature as unsecured or unguaranteed Debt; and |
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(vii) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, clause or other subdivision. |
Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A hereto, with such applicable legends as are provided in Exhibit A hereto, except as otherwise permitted herein (the “Restricted Global Note”), which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Common Depositary, and registered in the name of the Common Depositary or its nominee, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Global Note and recorded in the Security Register, as hereinafter provided.
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(c) Book-Entry Provisions. This Section 2.01(c) shall apply to the Regulation S Global Notes and the Restricted Global Notes (together, the “Global Notes”) deposited with the Common Depositary. |
Members of, or participants and account holders in Euroclear and Clearstream, (“Participants”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Common Depositary or by the Trustee or any custodian of the Common Depositary or under such Global Note, and the Common Depositary or its nominees may be treated by the Issuers, a Guarantor, the Trustee and any agent of the Issuers, a Guarantor or the Trustee as the sole owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, a Guarantor, the Trustee or any agent of the Issuers from giving effect to any written certification, proxy or other authorization furnished by Euroclear and Clearstream or impair, as between Euroclear and Clearstream, on the one hand, and the Participants, on the other, the operation of customary practices of such persons governing the exercise of the rights of a Holder of a beneficial interest in any Global Note.
Subject to the provisions of Section 2.10(b), the registered Holder of a Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action that a Holder is entitled to take under this Indenture or the Notes.
Except as provided in Section 2.10, owners of a beneficial interest in Global Notes will not be entitled to receive physical delivery of certificated Notes.
If an authorized member of either of the Issuers’ boards of directors or an executive officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.
A Note shall not be valid or obligatory for any purpose until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Issuers shall execute and, upon receipt of an Issuers Order, the Trustee shall authenticate (whether itself or via the authenticating agent) (a) Original Notes, on the date hereof, for original issue up to an aggregate principal amount of £400,000,000 and (b) Additional Notes, from time to time, subject to compliance at the time of issuance of such Additional Notes with the provisions of Section 4.06; provided that, if any Additional Notes are not fungible with any series of original Notes for U.S. income tax purposes, such Additional Notes will have a separate ISIN and/or Common Code number, as the case may be.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuers to authenticate the Notes. Unless limited by the terms of such appointment, any such authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by any such agent. An authenticating agent has the same rights as any Registrar, co-Registrar, Transfer Agent or Paying Agent to deal with the Issuers or an Affiliate of the Issuers.
The Trustee shall have the right to decline to authenticate and deliver any Notes under this Section 2.02 if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability to existing Holders.
Either Issuer or any of their respective Affiliates may act as Transfer Agent, Registrar, co-Registrar, Paying Agent and agent for service of notices and demands in connection with the Notes; provided that neither Issuer nor any of their respective Affiliates shall act as Paying Agent for the purposes of Articles Three and Eight and Sections 4.09 and 4.11.
The Issuers hereby appoint (i) Citibank, N.A., London Branch located at 25 Canada Square, London E14 5LB, United Kingdom as Transfer Agent, as Principal Paying Agent (the “Principal Paying Agent”) in London, United Kingdom, and as agent for service of notices and demands in connection with the Notes and (ii) Citigroup Global Markets Deutschland AG, at 5th Floor Reuterweg 16, 60323 Frankfurt, Germany, as Registrar. Each hereby accepts such appointments. The Transfer Agent, Principal Paying Agent and Registrar and any authenticating agent are collectively referred to in this Indenture as the “Agents”. The roles, duties and functions of the Agents are of a mechanical nature and each Agent shall only perform those acts and duties as specifically set out in this Indenture and no other acts, covenants, obligations or duties shall be implied or read into this Indenture against any of the Agents. For the avoidance of doubt, a Paying Agent’s obligation to disburse any funds shall be subject to prior receipt by it of those funds to be disbursed.
The Issuers shall maintain a Paying Agent in the United Kingdom or an EU Member State that is not obliged to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of November 26 and 27, 2000 on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, any such Directive.
Subject to any applicable laws and regulations, the Issuers shall cause the Registrar to keep a register (the “Security Register”) at its corporate trust office in which, subject to such reasonable regulations it may prescribe, the Issuers shall provide for the registration of ownership, exchange, and transfer of the Notes. Such registration in the Security Register shall be conclusive evidence of the ownership of Notes. Included in the books and records for the Notes shall be notations as to whether such Notes have been paid, exchanged or transferred, canceled, lost, stolen, mutilated or destroyed and whether such Notes have been replaced. In the case of the replacement of any of the Notes, the Registrar shall keep a record of the Note
so replaced and the Note issued in replacement thereof. In the case of the cancellation of any of the Notes, the Registrar shall keep a record of the Note so canceled and the date on which such Note was canceled.
The Issuers shall enter into an appropriate agency agreement with any Paying Agent or co-Registrar not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuers shall notify the Trustee of the name and address of any such agent. If the Issuers fail to maintain a Registrar or Paying Agent, the Trustee may appoint a suitably qualified and reputable party to act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.05.
The Trustee may, if the Issuers have notified it in writing that the Issuers intend to effect a defeasance or to satisfy and discharge this Indenture in accordance with the provisions of Article Eight, notify the Paying Agent in writing of this fact and require the Paying Agent (until notified by the Trustee to the contrary), to act thereafter as Paying Agent of the Trustee and not the Issuers in relation to any amounts deposited with it in accordance with the provisions of Article Eight.
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(a) Where Notes are presented to the Registrar or a co-Registrar with a request to register a transfer or to exchange them for an equal principal amount of Notes of other denominations, the Registrar shall register the transfer or make the exchange in accordance with the requirements of this Section 2.06. To permit registrations of transfers and exchanges, the Issuers shall execute and the Trustee (or the authenticating agent) shall, upon receipt of an Issuers Order, authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes, of any authorized denominations and of a like aggregate principal amount, at the Registrar’s request provided that no Note of less than £100,000 may be transferred or exchanged. No service charge shall be made for any registration of transfer or exchange of Notes (except as otherwise expressly permitted herein), but the Issuers may require payment of a sum sufficient to cover any agency fee or similar charge payable in connection with any such registration of transfer or exchange of Notes (other than any agency fee or similar charge payable in connection with any redemption of the Notes or upon exchanges pursuant to Sections 2.10, 3.07 or 9.05) or in accordance with an Excess Proceeds Offer pursuant to Section 4.09 or Change of Control Offer pursuant to Section 4.11, not involving a transfer. |
Upon presentation for exchange or transfer of any Note as permitted by the terms of this Indenture and by any legend appearing on such Note, such Note shall be exchanged or transferred upon the Security Register and one or more new Notes shall be authenticated and issued in the name of the Holder (in the case of exchanges only) or the transferee, as the case may be. No exchange or transfer of a Note shall be effective under this Indenture unless and until such Note has been registered in the name of such Person in the Security Register. Furthermore, the exchange or transfer of any Note shall not be effective under this Indenture unless the request for such exchange or transfer is made by the Holder or by a duly authorized attorney-in-fact at the office of the Registrar.
Every Note presented or surrendered for registration of transfer or for exchange shall (if so required by the Issuers or the Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Issuers and the Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.
All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuers evidencing the same indebtedness, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.
Neither the Issuers nor the Trustee, Registrar or any Paying Agent shall be required (i) to issue, register the transfer of, or exchange any Note during a period beginning at the opening of 15 Business Days before the day of the mailing of a notice of redemption of Notes selected for redemption under Section 3.02 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.
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(b) Notwithstanding any provision to the contrary herein, so long as a Global Note remains outstanding and is held by or on behalf of the Common Depositary, transfers of a Global Note, in whole or in part, or of any beneficial interest therein, shall only be made in accordance with Section 2.01(c), Section 2.06(a) and this Section 2.06(b); provided, that a beneficial interest in a Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Global Note in accordance with the transfer restrictions set forth in the restricted Note legend on the Note, if any. |
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(i) Except for transfers or exchanges made in accordance with any of sub-clauses (ii) through (v) of this Section 2.06(b), transfers of a Global Note shall be limited to transfers of such |
Global Note in whole, but not in part, to nominees of the Common Depositary or to a successor of the Common Depositary or such successor’s nominee. |
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(ii) Restricted Global Note to Regulation S Global Note. If the holder of a beneficial interest in the Restricted Global Note at any time wishes to exchange its interest in such Restricted Global Note for an interest in the Regulation S Global Note, or to transfer its interest in such Restricted Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Global Note, such transfer or exchange may be effected, only in accordance with this sub-clause (ii) and the rules and procedures of Euroclear and Clearstream, to the extent applicable (the “Applicable Procedures”). Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Global Note and shall increase or cause to be increased the principal amount of the Regulation S Global Note by the aggregate principal amount of the interest in the Restricted Global Note to be exchanged or transferred. |
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(iii) Regulation S Global Note to Restricted Global Note. If the holder of a beneficial interest in the Regulation S Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Global Note, such transfer may be effected only in accordance with this sub-clause (iii) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuers or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Global Note and to increase or cause to be increased the principal amount of the Restricted Global Note by the aggregate principal amount of the interest in such Regulation S Global Note to be exchanged or transferred. |
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(c) If Notes are issued upon the transfer, exchange or replacement of Notes bearing the restricted Notes legends set forth in Exhibit A, the Notes so issued shall bear the restricted Notes legends, and a request to remove such restricted Notes legends from Notes shall not be honored unless there is delivered to the Issuers such satisfactory evidence, which may include an Opinion of Counsel licensed to practice law in the State of New York, as may be reasonably required by the Issuers, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A or Rule 144 under the Securities Act. Upon provision of such satisfactory |
evidence, the Trustee, at the direction of the Issuers, shall (or shall direct the authenticating agent to) authenticate and deliver Notes that do not bear the legend. |
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(d) The Trustee and the Agents shall have no responsibility for any actions taken or not taken by Euroclear or Clearstream. |
In the event any such mutilated, lost, destroyed or wrongfully taken Note has become or is about to become due and payable, the Issuers in its discretion may pay such Note instead of issuing a new Note in replacement thereof.
Every replacement Note shall be an additional obligation of the Issuers.
The provisions of this Section 2.07 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or wrongfully taken Notes.
If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory to them that the Note that has been replaced is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal, interest and Additional Amounts, if any, payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Notes and that the pledgee is not either Issuer or any of their respective Affiliates. |
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(a) A Global Note deposited with the Common Depositary pursuant to Section 2.01 shall be transferred in whole to the beneficial owners thereof in the form of certificated Notes only if such transfer complies with Section 2.06 and (i) Euroclear or Clearstream notifies the Issuers that it is unwilling or unable to continue to act as depositary and a successor depositary is not appointed by the Issuers within 120 days of such notice, or (ii) the owner of a Book-Entry Interest requests such an exchange in writing delivered through Euroclear or Clearstream following an Event of Default under this Indenture. Notice of any such transfer shall be given by the Issuers in accordance with the provisions of Section 12.02(a). |
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(c) In the event of the occurrence of any of the events specified in Section 2.10(a), the Issuers shall promptly make available to the Trustee and the authenticating agent a reasonable supply of certificated Notes in definitive, fully registered form without interest coupons. |
aggregate amount proposed to be paid in respect of such Defaulted Interest; or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause (a). In addition, the Issuers shall fix a special record date for the payment of such Defaulted Interest, such date to be not more than 15 days and not less than 10 days prior to the proposed payment date and not less than 15 days after the receipt by the Trustee of the notice of the proposed payment date. The Issuers shall promptly but, in any event, not less than 15 days prior to the special record date, notify the Trustee of such special record date and, in the name and at the expense of the Issuers, the Trustee shall cause notice of the proposed payment date of such Defaulted Interest and the special record date therefor to be mailed first-class, postage prepaid to each Holder as such Holder’s address appears in the Security Register, not less than 10 days prior to such special record date. Notice of the proposed payment date of such Defaulted Interest and the special record date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes are registered at the close of business on such special record date and shall no longer be payable pursuant to clause (b) of this Section 2.12. |
Subject to the foregoing provisions of this Section 2.12, each Note delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.
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SECTION 2.13. Computation of Interest. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. |
of Notes to be redeemed, the Redemption Price and the paragraph of the Notes pursuant to which the redemption will occur. If and so long as the Notes are listed on the Irish Stock Exchange and the rules and regulations of the Irish Stock Exchange so require, the Issuers shall publish the notice of redemption in a newspaper having general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of the Irish Stock Exchange, posted on the official website of the Irish Stock Exchange (www.ise.ie)). |
The Issuers shall give each notice to the Trustee provided for in this Section 3.02 in writing at least 10 days before the date notice is mailed to the Holders pursuant to Section 3.04 unless the Trustee consents to a shorter period. Such notice shall be accompanied by an Officer’s Certificate from the Issuers to the effect that such redemption will comply with the conditions herein. If fewer than all the Notes are to be redeemed, the record date relating to such redemption shall be selected by the Issuers and given to the Trustee.
The Trustee or the Registrar shall make the selection from the Notes outstanding and not previously called for redemption. The Trustee or the Registrar may select for redemption portions equal to £1,000 in principal amount and any integral multiple thereof; provided that no Notes of £100,000 in principal amount or less may be redeemed in part. Provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee or the Registrar, as applicable, shall notify the Issuers promptly in writing of the Notes or portions of Notes to be called for redemption.
Neither the Trustee nor the Registrar shall be liable for selections made in accordance with the provisions of this Section 3.03.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such redemption or notice shall state that in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date or by the redemption date so delayed.
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(a) At least 10 days but not more than 60 days before a date for redemption of Notes, the Issuers shall mail a notice of redemption by first-class mail to each Holder to be redeemed and shall comply with the provisions of Section 12.02(b). |
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(b) The notice shall identify the Notes to be redeemed (including ISIN and Common Code numbers, as applicable) and shall state: |
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(i) the Redemption Date and the record date; |
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(ii) the appropriate calculation of the Redemption Price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid; |
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(iii) the name and address of the Paying Agent; |
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(iv) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any, and Additional Amounts, if any; |
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(v) that, if any Note is being redeemed in part, the portion of the principal amount (equal to £1,000 in principal amount or any integral multiple thereof) of such Note to be redeemed and that, on and after the Redemption Date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be reissued; |
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(vi) that, if any Note contains an ISIN or Common Code number, no representation is being made as to the correctness of such ISIN or Common Code number either as printed on the Notes or as contained in the notice of redemption and that reliance may be placed only on the other identification numbers printed on the Notes; |
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(vii) that, unless the Issuers and the Guarantors default in making such redemption payment, interest on the Notes (or portion thereof) called for redemption shall cease to accrue on and after the Redemption Date; |
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(viii) the paragraph of the Notes pursuant to which the Notes called for redemption are being redeemed; and |
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(ix) whether the redemption is conditioned on any events and, if so, the notice shall specify such events. |
At the Issuers’ written request, the Trustee shall give a notice of redemption in the Issuers’ name and at the Issuers’ expense. In such event, the Issuers shall provide the Trustee with the notice and the other information required by this Section 3.04.
of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders registered as such at the close of business on the relevant Record Date. |
Notice of redemption shall be deemed to be given when mailed, whether or not the Holder receives the notice. In any event, failure to give such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of Notes held by Holders to whom such notice was properly given.
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(a) Upon surrender of a Global Note that is redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on the Security Register to reduce the principal amount of such Global Note to an amount equal to the unredeemed portion of the Global Note surrendered; provided that each such Global Note shall be in a principal amount at final Stated Maturity of £100,000 or an integral multiple of £1,000 in excess thereof. |
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(b) Upon surrender and cancellation of a certificated Note that is redeemed in part, the Issuers shall execute and the Trustee shall authenticate for the Holder (at the Issuers’ expense) a new Note equal in principal amount to the unredeemed portion of the Note surrendered and canceled; provided that each such certificated Note shall be in a principal amount at final Stated Maturity of £100,000 or an integral multiple of £1,000 in excess thereof. |
The Issuers or the Guarantors shall pay interest on overdue principal at the rate specified therefor in the Notes. The Issuers or the Guarantors shall pay interest on overdue installments of interest at the same rate to the extent lawful.
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(a) The Parent Guarantor shall deliver to the Trustee, within 120 days after the end of each fiscal year or within 14 days of written request by the Trustee, an Officer’s Certificate stating that in the course of the performance by the signer of its duties as an officer of the Parent Guarantor he would normally have knowledge of any Default and whether or not the signer knows of any Default that occurred during such period and if any specifying such Default, its status and what action the Parent Guarantor is taking or proposed to take with respect thereto. For purposes of this Section 4.05(a), such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. |
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(b) If the Parent Guarantor or the Issuers shall become aware that (i) any Default or Event of Default has occurred and is continuing or (ii) any Holder seeks to exercise any remedy hereunder with respect to a claimed Default under this Indenture or the Notes, the Parent Guarantor or the Issuers, as the case may be, shall immediately deliver to the Trustee an Officer’s Certificate specifying such event, notice or other action (including any action the Parent Guarantor or the Issuers are taking or propose to take in respect thereof). |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, create, issue, Incur, assume, guarantee or in any manner become directly or indirectly liable with respect to or otherwise become responsible for, contingently or otherwise, the payment of (individually and collectively, to “Incur” or, as appropriate, an “Incurrence”), any Debt (including any Acquired Debt); provided that the Parent Guarantor, each Issuer and any Restricted Subsidiary shall be permitted to Incur Debt (including Acquired Debt) if in each case (i) after giving effect to the Incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, no Default or Event of Default would occur or be continuing and (ii) at the time of such Incurrence and after giving effect to the Incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio for the four full fiscal quarters for which financial statements are available immediately preceding the Incurrence of such Debt, taken as one period, would be greater than 2.0 to 1.0. |
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(b) Section 4.06(a) shall not, however, prohibit the following (collectively, “Permitted Debt”): |
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(i) the Notes issued on the Issue Date; |
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(ii) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Credit Facilities in an aggregate principal amount not to exceed the greater of (i) €350,000,000 and (ii) an amount equal to (I) 85% of Total Receivables plus 60% of Total Inventories less (II) €250,000,000; |
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(iii) any Existing Debt of the Parent Guarantor or any Restricted Subsidiary (other than Debt described in clauses (i) and (ii) of this Section 4.06(b)); |
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(iv) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of intercompany Debt between the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; provided that: |
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(A) if an Issuer or a Guarantor is the obligor on any such Debt, unless required by a Credit Facility and only to the extent legally permitted, such Debt must be unsecured (except in respect of the intercompany current liabilities Incurred in the ordinary course of business in connection with cash management, cash pooling, tax and accounting operations of the Parent Guarantor and its Restricted Subsidiaries); and |
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(B) (x) any disposition, pledge or transfer of any such Debt to a Person (other than a disposition, pledge or transfer to the Parent Guarantor or a Restricted Subsidiary) and (y) any transaction pursuant to which any Restricted Subsidiary that has Debt owing by the Parent Guarantor or another Restricted Subsidiary ceases to be a Restricted Subsidiary, will, in each case, be deemed to be an Incurrence of such Debt not permitted by this clause (iv); |
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(v) guarantees of the Parent Guarantor or any Restricted Subsidiary of Debt of the Parent Guarantor or any Restricted Subsidiary to the extent that the guaranteed Debt was permitted to be incurred by another provision of this Section 4.06; |
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(vi) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt represented by Capitalized Lease Obligations, mortgage financings, purchase money obligations or other Debt Incurred or assumed in connection with the acquisition or development of real or personal, movable or immovable, property or assets, in each case, Incurred for the purpose of financing or refinancing all or any part of the purchase price, lease expense or cost of construction or improvement of property, plant, equipment or other assets used in the Parent Guarantor’s or any Restricted Subsidiary’s business (including any reasonable related fees or expenses Incurred in connection with such acquisition or development); provided that the principal amount of such Debt so Incurred when aggregated with other Debt previously Incurred in reliance on this clause (vi) and still outstanding shall not in the aggregate exceed the greater of €150,000,000 and 2.0% of Total Assets; and provided, further, that the total principal amount of any Debt Incurred in connection with an acquisition or development permitted under this clause (vi) did not in each case at the time of Incurrence exceed (A) the Fair Market Value of the acquired or constructed asset or improvement so financed or (B) in the case of an uncompleted constructed asset, the amount of the asset to be constructed, as determined on the date the contract for construction of such asset was entered into by the Parent Guarantor or the relevant Restricted Subsidiary (including, in each case, any reasonable related fees and expenses Incurred in connection with such acquisition, construction or development); |
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(vii) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt arising from agreements providing for guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock (other than guarantees or similar credit support given by the Parent Guarantor or any Restricted Subsidiary of Debt Incurred by any Person acquiring all or any portion of such assets for the purpose of financing such acquisition); provided that the maximum aggregate liability in respect of all such Debt permitted pursuant to this clause (vii) shall at no time exceed the net proceeds, including non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received from the sale of such assets; |
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(viii) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Commodity Hedging Agreements entered into in the ordinary course of business and not for speculative purposes; |
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(ix) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Currency Agreements entered into in the ordinary course of business and not for speculative purposes; |
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(x) the Incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Interest Rate Agreements entered into in the ordinary course of business and not for speculative purposes; |
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(xi) the Incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of workers’ compensation and claims arising under similar legislation, or pursuant to self-insurance obligations and not in connection with the borrowing of money or the obtaining of advances or credit; |
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(xii) the Incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary arising from (A) the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Debt is extinguished within five Business Days of Incurrence, (B) bankers’ acceptances, performance, surety, judgment, completion, payment, appeal or similar bonds, instruments or obligations, (C) completion guarantees, advance payment, customs, VAT or other tax guarantees or similar instruments provided or letters of credit obtained by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business, and (D) the financing of insurance premiums in the ordinary course of business; |
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(xiii) any Debt of the Parent Guarantor or any Restricted Subsidiary Incurred pursuant to any Permitted Receivables Financing; |
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(xiv) the Incurrence by a Person of Permitted Refinancing Debt in exchange for or the net proceeds of which are used to refund, replace or refinance Debt Incurred by it pursuant to, or described in, Section 4.06(a), sub-clauses (i) and (iii), this sub-clause (xiv) and sub-clauses (xviii), (xix) and (xx) of this Section 4.06(b), as the case may be; |
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(xv) guarantees by the Parent Guarantor or a Restricted Subsidiary of Debt Incurred by Permitted Joint Ventures in an aggregate principal amount at any one time outstanding not to exceed an amount equal to the greater of €75,000,000 and 1.0% of Total Assets; |
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(xvi) cash management obligations and Debt in respect of netting services, pooling arrangements or similar arrangements in connection with cash management in the ordinary course of business consistent with past practice; |
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(xvii) (i) take-or-pay obligations in the ordinary course of business, (ii) customer deposits and advance payments in the ordinary course of business received from customers for goods or services purchased in the ordinary course of business and (iii) manufacturer, vendor financing, customer and supply arrangements in the ordinary course of business; |
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(xviii) the Incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary (other than and in addition to Debt permitted under clauses (i) through (xvii) above and clauses (xix) and (xx) below) in an aggregate principal amount at any one time outstanding not to exceed, together with any Permitted Refinancing Debt in respect thereof, the greater of €265,000,000 and 3.5% of Total Assets; |
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(xix) Debt of any Person (x) Incurred and outstanding on the date on which such Person becomes a Restricted Subsidiary of the Parent Guarantor or another Restricted Subsidiary of the Parent Guarantor or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Parent Guarantor or any Restricted Subsidiary or (y) Incurred to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary; provided, however, with respect to each of sub-clause (x) and (y) of this Section 4.06(b)(xix), that at the time of such acquisition or other transaction (1) the Parent Guarantor would have been able to Incur €1.00 of additional Indebtedness pursuant to Section 4.06(a) after giving effect to the Incurrence of such Indebtedness pursuant to this Section 4.06(b)(xix) or (2) the Fixed Charge Coverage Ratio of the Parent Guarantor and its Restricted Subsidiaries would not be less than it was immediately prior to giving pro forma effect to such acquisition or other transaction; and |
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(xx) Contribution Debt. |
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(c) Accrual of interest or dividends, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest or dividends in the form of additional Debt of the same class will not be deemed to be an Incurrence of Debt for purposes of this Section 4.06. |
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(d) For purposes of determining compliance with any restriction on the Incurrence of Debt in euros where Debt is denominated in a different currency, the amount of such Debt will be the Euro Equivalent determined on the date of such determination; provided that if any such Debt denominated in a different currency is subject to a Currency Agreement (with respect to euros) covering principal amounts payable on such Debt, the amount of such Debt expressed in euros shall be adjusted to take into account the effect of such agreement. The principal amount of any Permitted Refinancing Debt Incurred in the same currency as the Debt being refinanced shall be the Euro Equivalent of the Debt refinanced determined on the date such Debt being refinanced was initially Incurred. Notwithstanding any other provision of this Section 4.06, for purposes of determining compliance with this Section 4.06, increases in Debt solely due to fluctuations in the exchange rates of currencies will not be deemed to exceed the maximum amount that an Issuer, the Parent Guarantor or a Subsidiary Guarantor may Incur under this Section 4.06. |
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(e) For purposes of determining any particular amount of Debt under this Section 4.06: |
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(i) obligations with respect to letters of credit, guarantees or Liens, in each case supporting Debt otherwise included in the determination of such particular amount shall not be included; |
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(ii) any Liens granted pursuant to the equal and ratable provisions referred to in Section 4.07 shall not be treated as Debt; |
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(iii) accrual of interest, accrual of dividends, the accretion of accreted value, the obligation to pay commitment fees and the payment of interest in the form of additional preferred stock or Debt shall not be treated as Debt; and |
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(iv) the reclassification of preferred stock as Debt due to a change in accounting principles shall not be treated as Debt. |
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(f) In the event that an item of Debt meets the criteria of more than one of the types of Debt described in this Section 4.06, the Parent Guarantor, in its sole discretion, shall classify items of Debt and shall only be required to include the amount and type of such Debt in one of such clauses and the Parent Guarantor shall be entitled to divide and classify an item of Debt in more than one of the types of Debt described in this Section 4.06, and may change the classification of an item of Debt (or any portion thereof) to any other type of Debt described in this Section 4.06 at any time. |
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(g) The amount of any Debt outstanding as of any date will be: |
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(i) in the case of any Debt issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS; |
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(ii) the principal amount of the Debt, in the case of any other Debt; and |
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(iii) in respect of Debt of another Person secured by a Lien on the assets of the specified Person, the lesser of: |
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(A) the Fair Market Value of such assets at the date of determination; and |
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(B) the amount of the Debt of the other Person. |
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(a) in the case of any Lien securing Subordinated Debt, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Subordinated Debt of a Guarantor) are directly secured by a Lien on such property, assets or proceeds that is senior in priority to the Lien securing the Subordinated Debt until such time as the Subordinated Debt is no longer secured by a Lien; and |
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(b) in the case of any other Lien, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Debt of a Guarantor), and all other amounts due under this Indenture are equally and ratably secured with the obligation or liability secured by such Lien. |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, take any of the following actions (each of which is a “Restricted Payment” and which are collectively referred to as “Restricted Payments”): |
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(i) declare or pay any dividend on or make any distribution (whether made in cash, securities or other property) with respect to any of the Parent Guarantor’s or any Restricted Subsidiary’s Capital Stock (including, without limitation, any payment in connection with any merger or consolidation involving the Parent Guarantor or any Restricted Subsidiary) (other than (A) to the Parent Guarantor or any Restricted Subsidiary or (B) to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Parent Guarantor or a Restricted Subsidiary of dividends or distributions of greater value than the Parent Guarantor or such Restricted Subsidiary would receive on a pro rata basis; provided that any amount so paid or distributed to holders of Capital Stock of a Restricted Subsidiary other than the Parent Guarantor or a Restricted Subsidiary shall be included in the calculation of the aggregate amount of all Restricted Payments declared or made after the Issue Date for the purposes of Section 4.08(b)), except for dividends or distributions payable solely in shares of the Parent Guarantor’s Qualified Capital Stock or in options, warrants or other rights to acquire such shares of Qualified Capital Stock, or make any payment of cash interest on Deeply Subordinated Funding; |
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(ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation), directly or indirectly, any shares of the Parent Guarantor’s Capital Stock held by persons other than the Parent Guarantor or a Restricted Subsidiary (other than Capital Stock of any Restricted Subsidiary or any entity that becomes a Restricted Subsidiary as a result thereof) or any options, warrants or other rights to acquire such shares of Capital Stock; |
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(iii) make any principal payment on, or repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled principal payment, sinking fund payment or maturity, any Subordinated Debt or any Deeply Subordinated Funding; or |
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(iv) make any Investment (other than any Permitted Investment) in any Person. |
If any Restricted Payment described in this Section 4.08(a) is not made in cash, the amount of the proposed Restricted Payment shall be the Fair Market Value of the asset to be transferred as of the date of transfer.
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(b) Notwithstanding Section 4.08(a), the Parent Guarantor or any Restricted Subsidiary may make a Restricted Payment if, at the time of and after giving pro forma effect to such proposed Restricted Payment: |
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(i) no Default or Event of Default has occurred and is continuing; |
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(ii) the Parent Guarantor could Incur at least €1.00 of additional Debt (other than Permitted Debt) pursuant to Section 4.06; and |
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(iii) the aggregate amount of all Restricted Payments declared or made after the Issue Date does not exceed the sum of: |
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(A) 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during the period beginning on July 1, 2014 and ending on the last day of the Parent Guarantor’s last fiscal quarter ending prior to the date of such proposed Restricted Payment (or, if such aggregate cumulative Consolidated Adjusted Net Income shall be a negative number, minus 100% of such negative amount), plus |
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(B) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received by the Parent Guarantor after the Issue Date as a contribution to its common equity capital or from the issuance or sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (including upon the exercise of options, warrants or rights) or warrants, options or rights to purchase shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (except, in each case to the extent such proceeds are used to purchase, redeem or otherwise retire Capital Stock or Subordinated Debt or Deeply Subordinated Funding as set forth in sub-clause (ii) or (iii) of Section 4.08(c) or constitute an Excluded Contribution or the proceeds of any Contribution Debt) (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid and Excluded Contributions), plus |
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(C) (x) the amount by which the Parent Guarantor’s Debt or Debt of any Restricted Subsidiary is reduced after the Issue Date upon the conversion or exchange (other than by the Parent Guarantor or its Subsidiary) of such Debt into the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, and (y) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received after the Issue Date by the Parent Guarantor from the issuance or sale (other than to any Subsidiary) of Redeemable Capital Stock that has been converted into or exchanged for the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, to the extent such Redeemable Capital Stock was originally sold for cash or Cash Equivalents, together with, in the case of both sub-clauses (x) and (y) of this Section 4.08(b)(iii)(C), the aggregate Net Cash Proceeds received by the Parent Guarantor at the time of such conversion or exchange (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid), plus |
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(D) (x) in the case of the disposition or repayment of any Investment constituting a Restricted Payment made after the Issue Date, an amount (to the extent not included in Consolidated Adjusted Net Income) equal to the cash proceeds of such disposition or repayment or the Fair Market Value of property received by the Parent Guarantor or a Restricted Subsidiary thereof in either case, less the cost of the disposition of such Investment and net of taxes, and (y) in the case of the designation of an Unrestricted Subsidiary as a Restricted Subsidiary (as long as the designation of such Subsidiary as an Unrestricted Subsidiary was deemed a Restricted Payment), the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary; provided that such amount shall not in any case exceed the amount of the Restricted Payment deemed made at the time that the Subsidiary was designated as an Unrestricted Subsidiary, plus |
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(E) €70,000,000. |
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(c) Notwithstanding clauses (a) and (b) of this Section 4.08, the Parent Guarantor and any Restricted Subsidiary may take the following actions so long as (with respect to sub-clauses (viii), (xi), (xii) and (xvii) of this clause (c)) no Default or Event of Default has occurred and is continuing: |
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(i) the payment of any dividend within 180 days after the date of its declaration if at such date of its declaration such payment would have been permitted by this Section 4.08; |
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(ii) the repurchase, redemption or other acquisition or retirement for value of any shares of the Parent Guarantor’s Capital Stock or options, warrants or other rights to acquire such Capital Stock in exchange for (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares or scrip), or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock, options, warrants or other rights to acquire such Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iii) the repurchase, redemption, defeasance or other acquisition or retirement for value or payment of principal of any Subordinated Debt or Deeply Subordinated Funding in exchange for, or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iv) the purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Debt (other than Redeemable Capital Stock) in exchange for, or out of the Net Cash Proceeds of a substantially concurrent Incurrence (other than to a Subsidiary) of, Permitted Refinancing Debt; |
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(v) the repurchase of Capital Stock deemed to occur upon the exercise of stock options with respect to which payment of the cash exercise price has been forgiven if the cumulative aggregate value of such deemed repurchases does not exceed the cumulative aggregate amount of the exercise price of such options received; |
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(vi) payments or distributions to dissenting shareholders pursuant to applicable law in connection with or in contemplation of a merger, consolidation or transfer of assets that complies with the provisions of Article Five; |
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(vii) cash payments in lieu of issuing fractional shares pursuant to the exchange or conversion of any exchangeable or convertible securities; |
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(viii) cash payments, advances, loans or expense reimbursements made to any parent company of the Parent Guarantor to permit any such company to pay (i) general operating expenses, customary directors’ fees, accounting, legal, corporate reporting and administrative expenses Incurred in the ordinary course of business in an amount not to exceed €20,000,000 in the aggregate in any fiscal year, and (ii) any taxes, duties or similar governmental fees of any such parent company to the extent such tax obligations are directly attributable to its ownership of the Parent Guarantor and its Restricted Subsidiaries; |
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(ix) any payments (including pursuant to a tax sharing agreement or similar arrangement) between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries files a consolidated tax return or with which the Parent Guarantor or any of its Restricted Subsidiaries is part of a group for tax purposes (including a fiscal unity) or any tax advantageous group contribution made pursuant to applicable legislation; provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand‑alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(x) the repurchase, redemption or other acquisition or retirement, and any loans, advances, dividends or distributions by the Parent Guarantor to any direct or indirect parent company to repurchase, redeem or otherwise acquire or retire, for value of any Capital Stock of the Parent Guarantor or any Restricted Subsidiary or any direct or indirect parent company held by any current or former officer, director, employee or consultant of the Parent Guarantor or any of its Restricted Subsidiaries; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Capital Stock may not exceed €7,500,000 plus an amount equal to €7,500,000 multiplied by the number of years that have elapsed since the Issue Date; provided, further that such amount in any calendar year may be increased by an amount not to exceed (A) the cash proceeds from the sale of Capital Stock of the Parent Guarantor or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Parent Guarantor, any of its Restricted Subsidiaries or any of its direct or indirect parent companies and (B) the cash proceeds of key man life insurance policies of the Parent Guarantor or a Restricted Subsidiary received by the Parent Guarantor or a Restricted Subsidiary after the Issue Date less any amount previously applied to the making of Restricted Payments pursuant to this clause (x), in each case, to the extent the cash proceeds have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.08(b)(iii)(B) or Section 4.08(c)(iii); |
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(xi) the declaration and payment by the Parent Guarantor of, or loans, advances, dividends or distributions to any parent company of the Parent Guarantor to pay, dividends on the common stock or common equity interests of the Parent Guarantor or any parent company following a Public Equity Offering, in an amount not to exceed in any fiscal year, 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during such fiscal year (the “Relevant Fiscal Year”); provided that such dividends shall be declared and paid no later than 180 days after the end of the Relevant Fiscal Year; |
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(xii) any Restricted Payment in connection with or in relation to or to permit or facilitate (including, but not limited to, payments to minority shareholders), directly or indirectly, the repayment, redemption, reduction, replacement or refinancing, in whole or in part, of the Senior Toggle Notes; provided that (x) the Consolidated Leverage Ratio of the Parent Guarantor on a pro forma basis after giving effect to any such Restricted Payment made pursuant to this clause (xii) but not including any Restricted Payment in connection with such repayment, redemption, reduction, replacement or refinancing made in reliance on Section 4.08(b) or another clause of Section 4.08(c) (other than this sub-clause (xii)) does not exceed 5.25 to 1.0; and (y) the Qualified Capital Stock of the Parent Guarantor or a holding company or a controlled affiliate thereof is listed on an international securities exchange; provided, further, that the total amount of Restricted Payments made pursuant to this clause (xii) shall not exceed the principal amount outstanding of the Senior Toggle Notes on the Issue Date, plus the amount of all accreted interest thereon, plus all fees and expenses incurred in connection with such repayment, reduction, replacement or refinancing, less the total principal amount thereof repaid or redeemed with the proceeds received |
from the sale of such listed Capital Stock by the issuer of the Senior Toggle Notes (or a parent entity or other affiliate thereof); |
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(xiii) Restricted Payments in an amount equal to the amount of Excluded Contributions made; |
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(xiv) the payment, purchase, redemption, defeasance or other acquisition or retirement for value of any Subordinated Debt of the Parent Guarantor and its Restricted Subsidiaries pursuant to Section 4.09 and Section 4.11; provided that, prior to such payment, purchase, redemption, defeasance or other acquisition or retirement for value, the Issuers or the Parent Guarantor has made a Change of Control Offer or Asset Sale Offer, as the case may be, with respect to Notes as a result of such Change of Control or Asset Sale, as the case may be, and has repurchased all such Notes validly tendered and not withdrawn in connection with such Change of Control Offer or Asset Sale Offer, as the case may be; |
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(xv) the declaration and payment of dividends to holders of any class or series of Redeemable Capital Stock Incurred in accordance with Section 4.06; |
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(xvi) dividends or other distributions of Capital Stock of Unrestricted Subsidiaries; and |
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(xvii) any other Restricted Payment; provided that the total aggregate amount of Restricted Payments made under this clause (xvii) does not exceed the greater of €125,000,000 and 1.5% of Total Assets. |
The actions described in sub-clauses (i), (vi), (xi) and (xvii) of Section 4.08(c) are Restricted Payments that will be permitted to be made in accordance with Section 4.08(c) but that reduce the amount that would otherwise be available for Restricted Payments under Section 4.08(b)(iii).
For purposes of determining compliance with this Section 4.08, in the event that a Restricted Payment meets the criteria of more than one of the categories described in sub-clauses (i) through (xvii) of Section 4.08(c), or is permitted pursuant to this Section 4.08, the Parent Guarantor and its Restricted Subsidiaries will be entitled to classify such Restricted Payment (or portion thereof) on the date of its payment or later reclassify such Restricted Payment (or portion thereof) in any manner that complies with this Section 4.08. The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Parent Guarantor or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, consummate any Asset Sale unless: |
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(i) the consideration the Parent Guarantor or such Restricted Subsidiary receives for such Asset Sale is not less than the Fair Market Value of the assets sold (as determined in good faith by the Parent Guarantor’s board of directors); |
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(ii) at least 75% of the consideration the Parent Guarantor or such Restricted Subsidiary receives in respect of such Asset Sale consists of (A) cash (including any Net Cash Proceeds received from the conversion within 90 days of such Asset Sale of securities, notes or other obligations received in consideration of such Asset Sale); (B) Cash Equivalents; (C) the assumption by the purchaser of (x) the Parent Guarantor’s Debt or Debt of any Restricted |
Subsidiary (other than Subordinated Debt) as a result of which neither the Parent Guarantor nor any of the Restricted Subsidiaries remains obligated in respect of such Debt or (y) Debt of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, if the Parent Guarantor and each other Restricted Subsidiary is released from any guarantee of such Debt as a result of such Asset Sale; (D) Replacement Assets; (E) any Designated Non-cash Consideration received by the Parent Guarantor or such Restricted Subsidiary in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (ii), not to exceed the greater of €100,000,000 and 1.25% of Total Assets at the time of the receipt of such Designated Non-cash Consideration, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value; or (F) a combination of the consideration specified in sub-clauses (A) to (E) of this Section 4.09(a)(ii); and |
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(iii) the Parent Guarantor delivers an Officer’s Certificate to the Trustee certifying that such Asset Sale complies with sub-clauses (i) and (ii) of this Section 4.09(a). |
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(b) If the Parent Guarantor or any Restricted Subsidiary consummates an Asset Sale, the Net Cash Proceeds from such Asset Sale, within 360 days after the consummation of such Asset Sale, may be used by the Parent Guarantor or such Restricted Subsidiary to (i) permanently repay or prepay any then outstanding Debt (other than Debt that is subordinated to the Notes or the Guarantees of the Notes) of the Parent Guarantor or any Restricted Subsidiary (and to effect a corresponding commitment reduction if such Debt is revolving credit borrowings) owing to a Person other than the Parent Guarantor or a Restricted Subsidiary, (ii) invest in any Replacement Assets, (iii) acquire all or substantially all of the assets of, or any Capital Stock of, another Similar Business, if, after giving effect to any such acquisition of Capital Stock, the Similar Business is or becomes a Restricted Subsidiary, or (iv) any combination of the foregoing; provided that in the case of sub-clause (ii) of this Section 4.09(b), if the Parent Guarantor or such Restricted Subsidiary, as the case may be, has entered into a binding commitment in definitive form within such 360-day period to so apply such Net Cash Proceeds with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”), such binding commitment shall be treated as a permitted application of such Net Cash Proceeds; provided, further, that if any Acceptable Commitment is later cancelled or terminated for any reason before such Net Cash Proceeds are applied and after such initial 360-day period, then such Net Cash Proceeds shall constitute Excess Proceeds. The amount of such Net Cash Proceeds not so used as set forth in this Section 4.09(b) constitutes “Excess Proceeds.” The Parent Guarantor may reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. |
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(c) The Parent Guarantor or the Issuers may also at any time, and the Parent Guarantor or the Issuers shall within 20 Business Days after the aggregate amount of Excess Proceeds exceeds €50,000,000, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in this Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of £1,000) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase. |
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(d) To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the |
Parent Guarantor may use the amount of such Excess Proceeds not used to purchase the Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by this Indenture. If the aggregate principal amount of the Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each Holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero. |
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(e) If the Parent Guarantor or the Issuers are obligated to make an Excess Proceeds Offer, the Parent Guarantor or the Issuers shall purchase the Notes and Pari Passu Debt, at the option of the holders thereof, in whole or in part (as an integral multiple of £1,000), on a date that is not earlier than 30 days and not later than 60 days from the date the notice of the Excess Proceeds Offer is given to such holders, or such later date as may be required under the Exchange Act; provided that Notes of £100,000 will be purchased in full. |
If the Parent Guarantor or the Issuers are required to make an Excess Proceeds Offer, the Parent Guarantor and the Issuers shall comply with the applicable tender offer rules, including Rule 14e-1 under the Exchange Act, and any other applicable securities laws and regulations, including any securities laws of Ireland and the requirements of any applicable securities exchange on which Notes or the Existing Ardagh Bonds are then listed. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09, the Issuers shall comply with such securities laws and regulations and shall not be deemed to have breached its obligations described in this Section 4.09 by virtue thereof.
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(i) such transaction or series of transactions is on terms that, taken as a whole, are not materially less favorable to the Parent Guarantor or such Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable arm’s‑length transaction with third parties that are not Affiliates; and |
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(ii) with respect to any transaction or series of related transactions involving aggregate payments or the transfer of assets or provision of services, in each case having a value greater than €50,000,000, the Parent Guarantor shall deliver a resolution of its board of directors (set out in an Officer’s Certificate to the Trustee) resolving that such transaction complies with clause (a)(i) of this Section 4.10 and that the fairness of such transaction has been approved by a majority of the Disinterested Directors (or in the event there is only one Disinterested Director, by such Disinterested Director) of the Parent Guarantor’s board of directors. |
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(f) Notwithstanding the foregoing, the restrictions set forth in Section 4.10(a) will not apply to: |
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(i) customary directors’ fees, indemnification and similar arrangements (including the payment of directors’ and officers’ insurance premiums), consulting fees, employee salaries, bonuses, employment agreements and arrangements, compensation or employee benefit arrangements, including stock options or legal fees; |
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(ii) any Restricted Payment not prohibited by Section 4.08 or the making of an Investment that is a Permitted Investment; |
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(iii) the agreements and arrangements existing on the Issue Date and any amendment, modification or supplement thereto; provided that any such amendment, modification or supplement to the terms thereof is not more disadvantageous to the Holders and to the Parent Guarantor and the Restricted Subsidiaries, as applicable, in any material respect than the original agreement or arrangement as in effect on the Issue Date; |
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(iv) any payments or other transactions pursuant to a tax sharing agreement between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries file a consolidated tax return or with which the Issuers are part of a consolidated group for tax purposes or any tax advantageous group contribution made pursuant to applicable legislation, provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand‑alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(v) transactions in the ordinary course of business with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of the Parent Guarantor solely because the Parent Guarantor owns, directly or through a Restricted Subsidiary, Capital Stock in, or controls, such Person; |
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(vi) the issuance of securities pursuant to, or for the purpose of the funding of, employment arrangements, stock options, and stock ownership plans, as long as the terms thereof are or have been previously approved by the Parent Guarantor’s board of directors; |
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(vii) the granting and performance of registration rights for the Parent Guarantor’s securities; |
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(viii) (A) issuances or sales of Qualified Capital Stock of the Parent Guarantor or Deeply Subordinated Funding and (B) any amendment, waiver or other transaction with respect to any Deeply Subordinated Funding in compliance with the other provisions of this Indenture; |
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(ix) pledges by the Parent Guarantor or any Restricted Subsidiary of the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture securing Debt owing by such Unrestricted Subsidiary or a Permitted Joint Venture; |
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(x) transactions with a joint venture made in the ordinary course of business |
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(xi) transactions between or among the Parent Guarantor and the Restricted Subsidiaries or between or among Restricted Subsidiaries; |
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(xii) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are fair to the Parent Guarantor or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Parent Guarantor or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person; |
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(xiii) any transaction effected as part of a Permitted Receivables Financing; |
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(xiv) pledges of equity interests of Unrestricted Subsidiaries; and |
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(xv) any employment agreement, consultancy agreement or employee benefit arrangement with any employee, consultant, officer or director of the Parent Guarantor or any Restricted Subsidiary, including under any stock option, stock appreciation rights, stock incentive or similar plans, entered into in the ordinary course of business. |
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(a) If a Change of Control occurs at any time, then the Issuers or the Parent Guarantor shall make an offer (a “Change of Control Offer”) to each Holder to purchase such Holder’s Notes, at a purchase price (the “Change of Control Purchase Price”) in cash in an amount equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (the “Change of Control Purchase Date”) (subject to the rights of holders of record on relevant regular Record Dates that are prior to the Change of Control Purchase Date to receive interest due on an Interest Payment Date). |
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(b) Within 30 days following any Change of Control, the Issuers or the Parent Guarantor shall: |
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(i) cause a notice of the Change of Control Offer to be: |
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(A) |
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delivered to holders of the Notes electronically or mailed by first-class mail, postage prepaid; and |
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(B) |
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if at the time of such notice the Notes are listed on the Irish Stock Exchange and the rules of the Irish Stock Exchange so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of the Irish Stock Exchange, posted on the official website of the Irish Stock Exchange (www.ise.ie)); and |
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(ii) send notice of the Change of Control Offer by first‑class mail, with a copy to the Trustee, to each Holder to the address of such Holder appearing in the Security Register, which notice shall state: |
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(A) that a Change of Control has occurred, and the date it occurred; |
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(B) the circumstances and relevant facts regarding such Change of Control (including, but not limited to, applicable information with respect to pro forma historical income, cash flow and capitalization after giving effect to the Change of Control); |
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(C) the Change of Control Purchase Price and the Change of Control Purchase Date, which shall be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations; |
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(D) that any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Purchase Date unless the Change of Control Purchase Price is not paid; |
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(E) that any Note (or part thereof) not tendered shall continue to accrue interest; and |
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(F) any other procedures that a Holder must follow to accept a Change of Control Offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on the Irish Stock Exchange). |
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(c) On the Change of Control Purchase Date, the Issuers shall, to the extent lawful: |
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(i) accept for payment all Notes or portions thereof (equal to £100,000 or an integral multiple of £1,000 in excess thereof) properly tendered pursuant to the Change of Control Offer; |
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(ii) deposit with the Paying Agent an amount equal to the Change of Control Purchase Price in respect of all Notes or portions thereof so tendered; and |
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(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Issuers. |
The Issuers or the Parent Guarantor will publicly announce the results of the Change of Control Offer on, or as soon as practical after, the Change of Control Purchase Date.
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(d) The Paying Agent shall promptly mail to each Holder that has properly tendered its Notes pursuant to the Change of Control Offer an amount equal to the Change of Control Purchase Price for such Notes and the Trustee shall itself or via the authenticating agent promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder a new Note or Notes equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note shall be in a principal amount of £100,000 and in integral multiples of £1,000 in excess thereof. |
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(e) If the Change of Control Purchase Date is on or after an interest Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest, if any, shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date, and no additional interest shall be payable to Holders who tender pursuant to the Change of Control Offer. |
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(f) Neither the Issuers nor the Parent Guarantor shall be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth herein applicable to a Change of Control Offer made by the Issuers or the Parent Guarantor and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. |
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(g) The Issuers and the Parent Guarantor shall comply with the applicable tender offer rules, including Rule 14e-l under the Exchange Act, and any other applicable securities laws and regulations in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Indenture, the Issuers and the Parent Guarantor shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Indenture by virtue of such conflict. |
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(h) Notwithstanding anything to the contrary contained in this Section 4.11, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. |
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(a) All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on the Notes or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If an Issuer, Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to the Notes or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted. |
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(b) None of the Issuers or Guarantors shall, however, pay Additional Amounts in respect or on account of: |
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(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of the Notes, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee); |
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(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of the Notes, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction); |
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(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes; |
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(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to the Notes or any Guarantee; |
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(v) any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note; |
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(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union; |
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(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Note been presented on the last day of such 30-day period); |
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(viii) any withholding or deduction in respect of any Taxes where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to the European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meetings of November 26 and 27, 2000 on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, any such Directive; |
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(ix) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or |
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(x) any combination of the foregoing. |
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(c) The Issuers and the Guarantors, if the applicable withholding agent, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law. |
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(d) At least 30 calendar days prior to each date on which any payment under or with respect to the Notes or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to the Notes or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. |
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of the Notes or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, the Notes or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuer and the Guarantors (and not otherwise in the possession of the Trustee) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
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(e) Whenever this Indenture or the Notes refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to any Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable. |
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(f) This Section 4.12 will survive any termination, defeasance or discharge of this Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on the Notes (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax. |
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(a) At the request and direction of the Parent Guarantor and without the consent of the Holders, in connection with the Incurrence by the Parent Guarantor or its Restricted Subsidiaries of any Permitted Debt, the Parent Guarantor, the relevant Restricted Subsidiaries and the Trustee shall enter into with the Holders (or their duly authorized representatives) an intercreditor agreement (an “Additional Intercreditor Agreement”) or a restatement, amendment or other modification of the existing Intercreditor Agreement, in each case on substantially the same terms as the Intercreditor Agreement or terms not violating the terms of this Indenture (for such matters covered by this Indenture) or terms not affecting adversely the rights of the holders of the Notes in material respects (for such matters not covered by this Indenture), including containing substantially the same terms with respect to release of Guarantees; provided that such Additional Intercreditor Agreement will not impose any personal obligations on the Trustee or, in the opinion of the Trustee, adversely affect the rights, duties, liabilities or immunities of the Trustee under this Indenture or the Intercreditor Agreement. |
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(b) At the request and direction of the Parent Guarantor and without the consent of the Holders, the Trustee shall from time to time enter into one or more amendments to any Intercreditor Agreement to: (i) cure any ambiguity, omission, defect or inconsistency of any such agreement, (ii) increase the amount or types of Debt covered by any such agreement that may be Incurred by an Issuer or a Guarantor that is subject to any such agreement (including with respect to any Intercreditor Agreement or Additional Intercreditor Agreement, the addition of provisions relating to new Debt ranking junior in right of payment to the Notes), (iii) add Restricted Subsidiaries to the Intercreditor Agreement or an Additional Intercreditor Agreement, (iv) amend the Intercreditor Agreement or any Additional Intercreditor Agreement in accordance with the terms thereof or (v) make any other change to any such agreement that does not violate the terms of this Indenture. The Parent Guarantor shall not otherwise direct the Trustee to enter into any amendment to any Intercreditor Agreement without the consent of the Holders of the majority in aggregate |
principal amount of the Notes then outstanding, except as otherwise permitted under Article Nine, and the Parent Guarantor may only direct the Trustee to enter into any amendment to the extent such amendment does not impose any personal obligations on the Trustee or, in the opinion of the Trustee, adversely affect their respective rights, duties, liabilities or immunities under this Indenture, the Intercreditor Agreement or any Additional Intercreditor Agreement. |
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(c) In relation to any Intercreditor Agreement or Additional Intercreditor Agreement, the Trustee shall consent on behalf of the Holders to the payment, repayment, purchase, repurchase, defeasance, acquisition, retirement or redemption of any obligations subordinated to the Notes thereby; provided, however, that such transaction would comply with Section 4.08. |
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(d) Each Holder, by accepting a Note, shall be deemed to have agreed to and accepted the terms and conditions of the Intercreditor Agreement or any Additional Intercreditor Agreement (whether then entered into or entered into in the future pursuant to the provisions of this Section 4.13) and to have directed the Trustee to enter into any such Additional Intercreditor Agreement. The Issuers shall make a copy of the Intercreditor Agreement or any Additional Intercreditor Agreement available for inspection by Holders during normal business hours on any Business Day upon prior written request at the offices of the Listing Agent. |
On or prior to the 90th day following the Issue Date and subject to the Agreed Security Principles, the Parent Guarantor shall ensure that each of the Subsidiaries of the Parent Guarantor (other than the Issuers) that is a guarantor of the Existing Ardagh Bonds shall become a Guarantor and, in connection therewith, cause such Subsidiary to deliver such agreements, instruments, certificates and opinions of counsel that may be reasonably requested by the Trustee.
In addition, subject to the Agreed Security Principles, the Parent Guarantor will be required to ensure that entities owning, in whole or in part, the Acquired Business (except in Spain, France and Brazil) become Subsidiary Guarantors.
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(a) The Parent Guarantor shall not permit any Restricted Subsidiary that is not an Issuer or a Guarantor, directly or indirectly, to guarantee, assume or in any other manner become liable for the payment of any Pari Passu Debt or Subordinated Debt of either Issuer (other than the Notes), the Parent Guarantor or any Subsidiary Guarantor, unless: |
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(i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to this Indenture providing for a Guarantee of payment of the Notes by such Restricted Subsidiary on the same terms as the guarantee of such Debt; and |
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(ii) with respect to any guarantee of Subordinated Debt by such Restricted Subsidiary, any such guarantee shall be subordinated to such Restricted Subsidiary’s Guarantee with respect to the Notes at least to the same extent as such Subordinated Debt is subordinated to the Notes. |
This clause (a) shall not be applicable to any guarantees of any Restricted Subsidiary:
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(A) existing on the Issue Date, guaranteeing Debt under Credit Facilities permitted to be Incurred pursuant to sub-clauses (ii) and (xiii) of Section 4.06(b) or guaranteeing Debt in an aggregate principal amount that is less than €75,000,000 ; |
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(B) that existed at the time such Person became a Restricted Subsidiary if the guarantee was not Incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary; or |
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(C) given to a bank or trust company having combined capital and surplus and undivided profits of not less than €500 million, whose debt has a rating, at the time such guarantee was given, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s, in connection with the operation of cash management programs established for the Parent Guarantor’s benefit or that of any Restricted Subsidiary. |
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(b) Notwithstanding the foregoing, any Guarantee of the Notes created pursuant to the provisions described in Section 4.15(a) may provide by its terms that it will be automatically and unconditionally released and discharged upon: |
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(i) any sale, exchange or transfer, to any Person who is not the Parent Guarantor or a Restricted Subsidiary of all of the Capital Stock owned by the Parent Guarantor and its other Restricted Subsidiaries in, or all or substantially all the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by this Indenture); or |
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(ii) (with respect to any Guarantee created after the Issue Date) the release by the Holders of the applicable Issuer’s, the Parent Guarantor’s or the Subsidiary Guarantor’s Debt described in Section 4.15(a), of their Guarantee by such Restricted Subsidiary (including any deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee), at a time when: |
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(A) no other Debt of either Issuer, the Parent Guarantor or any Subsidiary Guarantor has been guaranteed by such Restricted Subsidiary; or |
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(B) the holders of all such other Debt that is guaranteed by such Restricted Subsidiary also release their guarantee by such Restricted Subsidiary (including any deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee); or |
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(iii) the release of the Guarantees on the terms and conditions and in the circumstances described in Section 10.03. |
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(c) Notwithstanding the foregoing, the Parent Guarantor shall not be obligated to cause any such Restricted Subsidiary to guarantee the Notes to the extent that such Guarantee would reasonably be expected to give rise to or result in (A) any violation of applicable law, rule, regulation or order that cannot be avoided or otherwise prevented through measures reasonably available to the Parent Guarantor or such Restricted Subsidiary, (B) personal liability for the officers, directors or shareholders of such Restricted Subsidiary or (C) any significant cost, expense, liability or obligation (including with respect to any Taxes but excluding any reasonable guarantee or similar fee payable to the Parent Guarantor or a Restricted Subsidiary) other than any governmental or regulatory filings required as a result of, or any measures pursuant to sub-clause (A) of this Section 4.15(c) undertaken in connection with, such Guarantee, which |
cannot be avoided through measures reasonably available to the Parent Guarantor or the Restricted Subsidiary; provided, however, that any Restricted Subsidiary who directly or indirectly, guarantees, assumes or in any other manner become liable for the payment of any obligations under the Existing Ardagh Bonds shall also be required to Guarantee payment of the Notes on the same terms as the guarantee of such obligations. |
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(d) Each such additional Guarantee will be limited as necessary to recognize certain defenses generally available to guarantors (including those that relate to fraudulent conveyance or transfer, voidable preference, financial assistance, corporate purpose and corporate benefit, thin capitalization, distributable reserves, capital maintenance or similar laws, regulations or defenses affecting the rights of creditors generally) or other considerations under applicable law. |
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SECTION 4.16. Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries. |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Restricted Subsidiary to: |
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(i) pay dividends, in cash or otherwise, or make any other distributions on or in respect of its Capital Stock or any other interest or participation in, or measured by, its profits; |
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(ii) pay any Debt owed to the Parent Guarantor or any other Restricted Subsidiary; |
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(iii) make loans or advances to the Parent Guarantor or any other Restricted Subsidiary; or |
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(iv) transfer any of its properties or assets to the Parent Guarantor or any other Restricted Subsidiary. |
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(b) The provisions of Section 4.16(a) shall not apply to: |
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(i) encumbrances and restrictions imposed by the Notes, the Existing Ardagh Bonds, this Indenture, any Credit Facility, the indentures governing the Existing Ardagh Bonds, the Intercreditor Agreement (or any Additional Intercreditor Agreement), and the security documents related thereto or by other indentures or agreements governing other Debt Incurred ranking equally with the Notes; |
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(ii) any customary encumbrances or restrictions created under any agreements with respect to Debt of the Parent Guarantor or any Restricted Subsidiary permitted to be Incurred subsequent to the Issue Date pursuant to the provisions of Section 4.06, including encumbrances or restrictions imposed by Debt permitted to be Incurred under Credit Facilities or any guarantees thereof in accordance with Section 4.06; provided that such agreements do not prohibit the payment of interest with respect to the Notes or the Guarantees absent a default or event of default under such agreement; |
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(iii) encumbrances or restrictions contained in any agreement in effect on the Issue Date (other than an agreement described in another sub-clause of this Section 4.16(b)); |
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(iv) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), encumbrances and restrictions that restrict in a customary manner the subletting, assignment or |
transfer of any properties or assets that are subject to a lease, license, conveyance or other similar agreement to which the Parent Guarantor or any Restricted Subsidiary is a party; |
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(v) encumbrances or restrictions contained in any agreement or other instrument of a Person (including its Subsidiaries), acquired by the Parent Guarantor or any Restricted Subsidiary in effect at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired (including its Subsidiaries); |
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(vi) encumbrances or restrictions contained in contracts for sales of Capital Stock or assets permitted by the provisions of Section 4.09 with respect to the assets or Capital Stock to be sold pursuant to such contract or in customary merger or acquisition agreements (or any option to enter into such contract) for the purchase or acquisition of Capital Stock or assets or any of the Parent Guarantor’s Subsidiaries by another Person; |
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(vii) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), any customary encumbrances or restrictions pertaining to any asset or property subject to a Lien to the extent set forth in the security document or any related document governing such Lien; |
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(viii) encumbrances or restrictions imposed by applicable law or regulation or by governmental licenses, concessions, franchises or permits; |
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(ix) encumbrances or restrictions on cash or other deposits or net worth imposed by customers under contracts entered into the ordinary course of business; |
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(x) customary limitations on the distribution or disposition of assets or property in joint venture agreements entered into the ordinary course of business and in good faith by any Restricted Subsidiary; provided that such encumbrance or restriction is applicable only to such Restricted Subsidiary and its Subsidiaries; |
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(xi) in the case of Section 4.16(a)(iv), customary encumbrances or restrictions in connection with purchase money obligations, mortgage financings and Capitalized Lease Obligations for property acquired in the ordinary course of business; |
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(xii) any encumbrance or restriction arising by reason of customary non-assignment provisions in agreements; |
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(xiii) encumbrances or restrictions with respect to any Permitted Receivables Financing; provided that such encumbrances or restrictions are customarily required by the institutional sponsor or arranger of such Permitted Receivables Financing in similar types of documents relating to the purchase of similar receivables in connection with the financing thereof; |
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(xiv) encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to a Permitted Joint Venture; |
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(xv) encumbrances or restrictions Incurred in accordance with Section 4.07; or |
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(xvi) any encumbrances or restrictions existing under any agreement that extends, renews, amends, modifies, restates, supplements, refunds, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing sub-clauses (i) through (xv); provided |
that the terms and conditions of any such encumbrances or restrictions are not materially less favorable, taken as a whole, to the Holders of the Notes than those under or pursuant to the agreement so extended, renewed, amended, modified, restated, supplemented, refunded, refinanced or replaced. |
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(a) The Parent Guarantor’s board of directors may designate any Subsidiary (including newly acquired or newly established Subsidiaries) to be an “Unrestricted Subsidiary” only if no Default has occurred and is continuing at the time of or after giving effect to such designation. |
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(b) In the event of any designation of a Subsidiary as an Unrestricted Subsidiary in accordance with this Section 4.17, the Parent Guarantor shall be deemed to have made an Investment constituting a Restricted Payment pursuant to Section 4.08 for all purposes of this Indenture in an amount equal to the greater of (i) the net book value of the Parent Guarantor’s interest in such Subsidiary calculated in accordance with IFRS or (ii) the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary. |
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(c) The Parent Guarantor’s board of directors may designate any Unrestricted Subsidiary as a Restricted Subsidiary if: |
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(i) no Default or Event of Default has occurred and is continuing at the time of or will occur and be continuing after giving effect to such designation; and |
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(ii) (x) the Parent Guarantor could Incur at least €1.00 of additional Debt (pursuant to Section 4.06(a)) or (y) the Fixed Charge Coverage Ratio would not be less than it was immediately prior to giving effect to such designation, in each case, on a pro forma basis taking into account such designation. |
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(d) Any designation of a Subsidiary as an Unrestricted Subsidiary or Restricted Subsidiary by the Parent Guarantor’s board of directors in accordance with this Section 4.17 shall be evidenced to the Trustee by filing a resolution of the Parent Guarantor’s board of directors with the Trustee giving effect to such designation and an Officer’s Certificate certifying that such designation complies with the foregoing conditions, and giving the effective date of such designation. Any such filing with the Trustee must occur within 45 days after the end of the Parent Guarantor’s fiscal quarter in which such designation is made (or, in the case of a designation made during the last fiscal quarter of the Parent Guarantor’s fiscal year, within 90 days after the end of such fiscal year). |
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SECTION 4.19. Reports to Holders. So long as any Notes are outstanding, the Issuers or the Parent Guarantor shall furnish to the Trustee: |
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(a) within 120 days after the end of each of the Parent Guarantor’s fiscal year’s annual reports containing the following information: (a) audited consolidated balance sheets of the Parent Guarantor as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Parent Guarantor for the two most recent fiscal years, including footnotes to such financial statements and the report of the Parent Guarantor’s independent auditors on the financial statements; (b) an operating and financial review of the audited financial statements, including a discussion of the results of operations, financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (c) a description of the business and management of the Parent Guarantor; and (d) material recent developments to the extent not previously reported; |
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(b) within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Parent Guarantor’s quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year-to-date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Parent Guarantor, together with condensed footnote disclosure; (b) operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Parent Guarantor and any material change between the current quarterly period and the corresponding period of the prior year; and (c) material recent developments to the extent not previously reported; and |
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(c) promptly after the occurrence of any material acquisition, disposition or restructuring of the Parent Guarantor and the Restricted Subsidiaries, taken as a whole, or any change of the entire board of directors, chairman of the board of directors, chief executive officer or chief financial officer at the Parent Guarantor or change in auditors of the Parent Guarantor, a press release containing a description of such event. |
In addition, the Issuers or the Parent Guarantor shall furnish to the Holders and to prospective investors, upon the requests of such Holders, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the Exchange Act by Persons who are not “affiliates” under the Securities Act.
The Issuers or the Parent Guarantor shall also make available copies of all reports furnished to the Trustee (a) on the website of the Ardagh group of companies and (b) through the newswire service of Bloomberg, or, if Bloomberg does not then operate, any similar agency.
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(a) The Parent Guarantor shall not, in a single transaction or through a series of transactions, consolidate with or merge with or into any other Person or sell, assign, convey, transfer, lease or otherwise dispose of, or take any action pursuant to any resolution passed by the Parent Guarantor’s board of directors or shareholders with respect to a demerger or division pursuant to which the Parent Guarantor would dispose of, all or substantially all of the Parent Guarantor’s properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) to any Person or Persons and the Parent Guarantor shall not permit any Restricted Subsidiary to enter into any such transaction or series of transactions if such transaction or series of transactions, in the aggregate, would result in the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor and its Restricted Subsidiaries on a consolidated basis to any other Person or Persons. |
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(b) Section 5.01(a) shall not apply if: |
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(i) at the time of, and immediately after giving effect to, any such transaction or series of transactions, either the Parent Guarantor will be the continuing corporation or the Person (if |
other than the Parent Guarantor) formed by or surviving any such consolidation or merger or to which such sale, assignment, conveyance, transfer, lease or disposition of all or substantially all the properties and assets of the Parent Guarantor and the Restricted Subsidiaries on a consolidated basis has been made (the “Surviving Entity”): |
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(A) will be a corporation duly incorporated and validly existing under the laws of any member state of the European Union or the European Economic Area, the United States of America, any state thereof, the District of Columbia, Canada, Switzerland, Australia or Bermuda; and |
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(B) expressly assumes, by a supplemental indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture and the Notes and this Indenture shall remain in full force and effect as so supplemented; |
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(ii) immediately after giving effect to such transaction or series of transactions on a pro forma basis (and treating any Obligation of the Parent Guarantor or any Restricted Subsidiary Incurred in connection with or as a result of such transaction or series of transactions as having been Incurred by the Parent Guarantor or such Restricted Subsidiary at the time of such transaction), no Default or Event of Default will have occurred and be continuing; |
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(iii) immediately before and immediately after giving effect to such transaction or series of transactions on a pro forma basis (on the assumption that the transaction or series of transactions occurred on the first day of the four-quarter fiscal period immediately prior to the consummation of such transaction or series of transactions with the appropriate adjustments with respect to the transaction or series of transactions being included in such pro forma calculation), the Parent Guarantor (or the Surviving Entity if the Parent Guarantor is not the continuing obligor under this Indenture) could Incur at least €1.00 of additional Debt under the provisions of Section 4.06; |
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(iv) any Subsidiary Guarantor, unless it is the other party to the transactions described in this Section 5.01, shall have by supplemental indenture confirmed that its Guarantee will apply to such Person’s obligations under this Indenture and the Notes; |
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(v) any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets would thereupon become subject to any Lien, Section 4.07 complied with; and |
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(vi) the Parent Guarantor or the Surviving Entity shall have delivered to the Trustee, in form and substance satisfactory to the Trustee, an Officer’s Certificate (attaching the computations to demonstrate compliance with Section 5.01(b)(iii)) and an opinion of independent counsel, each stating that such consolidation, merger, sale, assignment, conveyance, transfer, lease or other disposition, and if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with the requirements of this Indenture and that this Indenture and the Notes constitute legal, valid and binding obligations of the continuing person, enforceable in accordance with their terms. |
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(c) Notwithstanding anything to the contrary contained in Section 5.01(b) , the Parent Guarantor may designate any Person as a successor parent guarantor (the “Successor Parent Guarantor”), provided that the Parent Guarantor could have merged or amalgamated in to such Person in accordance with the provisions of this Section 5.01, at the time of, and immediately after giving effect to such designation; provided, further that such Successor Parent Guarantor expressly assumes, by a supplemental |
indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture. |
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(d) The Surviving Entity or Successor Parent Guarantor, as applicable, shall succeed to, and be substituted for, and may exercise every right and power of, the Parent Guarantor under this Indenture, but, in the case of a lease of all or substantially all of the Parent Guarantor’s assets or in the case of the designation of a Successor Parent Guarantor in accordance with Section 5.01(c), the Parent Guarantor shall not be released from the obligation to pay the principal of, premium, if any, and interest, on the Notes. |
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(e) Nothing in this Indenture shall prevent (i) any Restricted Subsidiary from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor or any other Restricted Subsidiary or (ii) any Subsidiary Guarantor from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor, either Issuer or another Subsidiary Guarantor (and upon any such transfer, the Guarantee of the transferring Subsidiary Guarantor shall automatically be released); or (iii) the Parent Guarantor from appointing any Person as Successor Parent Guarantor that such appointment is made in accordance with Section 5.01(b). |
The Parent Guarantor shall publish a notice of any consolidation, merger or sale of assets described in Section 5.01(a) in accordance with Section 12.02 and, so long as the rules of the Irish Stock Exchange so require, notify such exchange of any such consolidation, merger or sale.
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(a) “Event of Default,” wherever used herein, means any of the following events: |
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(i) a default for 30 days in the payment when due of any interest or any Additional Amounts on any Note; or |
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(ii) default in the payment of the principal of or premium, if any, on any Note at its Maturity (upon acceleration, optional or mandatory redemption, if any, required repurchase or otherwise), whether or not prohibited by the subordination provisions of this Indenture or the Intercreditor Agreement (and/or any Additional Intercreditor Agreement); or |
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(iii) failure to comply with the provisions of Article Five; or |
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(iv) failure to comply with any covenant or agreement of the Parent Guarantor or of any Restricted Subsidiary that is contained herein or any Guarantees (other than specified in sub- |
clause (i), (ii) or (iii) of this Section 6.01(a)) and such failure continues for a period of 60 days or more, in each case after the written notice specified in Section 6.02(a); or |
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(v) default under the terms of any instrument evidencing or securing the Debt of the Parent Guarantor or any Restricted Subsidiary having an outstanding principal amount in excess of €75,000,000, in each case, individually or in the aggregate, if that default: (x) results in the acceleration of the payment of such Debt or (y) is caused by the failure to pay such Debt at final maturity thereof after giving effect to the expiration of any applicable grace periods and other than by regularly scheduled required prepayment, and such failure to make any payment has not been waived or the maturity of such Debt has not been extended, and in either case the total amount of such Debt unpaid or accelerated exceeds €75,000,000 or its equivalent at the time; or |
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(vi) any Guarantee ceases to be, or shall be asserted in writing by any Guarantor, or any Person acting on behalf of any Guarantor, not to be in full force and effect or enforceable in accordance with its terms (other than as provided for in this Indenture, any Guarantee, the Intercreditor Agreement or any Additional Intercreditor Agreement); or |
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(vii) one or more final judgments, orders or decrees (not subject to appeal and not covered by insurance) shall be rendered against the Parent Guarantor or any Material Subsidiary, either individually or in an aggregate amount, in excess of €75,000,000 or its equivalent at the time, and either a creditor shall have commenced an enforcement proceeding upon such judgment, order or decree or there shall have been a period of 60 consecutive days or more during which a stay of enforcement of such judgment, order or decree was not (by reason of pending appeal or otherwise) in effect; or |
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(viii) the entry by a court of competent jurisdiction of (A) a decree or order for relief in respect of the Parent Guarantor or any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or (B) a decree or order adjudging the Parent Guarantor or any Material Subsidiary bankrupt or insolvent, or seeking reorganization, arrangement, adjustment or composition of or in respect of the Parent Guarantor or any Material Subsidiary under any applicable law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Parent Guarantor or any Material Subsidiary or of any substantial part of their respective properties or ordering the winding up or liquidation of their affairs, and any such decree, order or appointment pursuant to any Bankruptcy Law for relief shall continue to be in effect, or any such other decree, appointment or order shall be unstayed and in effect, for a period of 100 consecutive days; or |
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(ix) (A) the Parent Guarantor or any Material Subsidiary (x) commences a voluntary case or proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent or (y) consents to the filing of a petition, application, answer or consent seeking reorganization or relief under any applicable Bankruptcy Law, (B) the Parent Guarantor or any Material Subsidiary consents to the entry of a decree or order for relief in respect of the Parent Guarantor or such Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it or, (C) the Parent Guarantor or any Material Subsidiary (x) consents to the appointment of, or taking possession by, a custodian, receiver, liquidator, administrator, supervisor, assignee, trustee, sequestrator or similar official of the Parent Guarantor or such Material Subsidiary or of any substantial part of their respective properties, (y) makes an assignment for the benefit of creditors or (z) admits in writing its inability to pay its debts generally as they become due. |
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(b) If a Default or an Event of Default occurs and is continuing and is known to a responsible officer of the Trustee, the Trustee shall mail to each Holder notice of the Default or Event of Default within 15 Business Days after its occurrence by registered or certified mail or facsimile transmission of an Officer’s Certificate specifying such event, notice or other action, its status and what action the Issuers are taking or proposes to take with respect thereto. Except in the case of a Default or an Event of Default in payment of principal of, premium, if any, and Additional Amounts or interest on any Notes, the Trustee may withhold the notice to the Holders of such Notes if its Trust Officers in good faith determine that withholding the notice is in the interests of the Holders. The Trustee shall not be deemed to have knowledge of a Default unless a Trust Officer has actual knowledge of such Default. The Issuers and the Parent Guarantor shall also notify the Trustee within 15 Business Days of the occurrence of any Default stating what action, if any, they are taking with respect to that Default. |
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(a) If an Event of Default with respect to the Notes (other than an Event of Default specified in sub-clauses (viii) or (ix) of Section 6.01(a)) occurs and is continuing, the Trustee or the Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders) may, and the Trustee, upon the written request of such Holders shall, declare the principal amount of, premium, if any, and any Additional Amounts and accrued interest on all of the outstanding Notes immediately due and payable, and upon any such declaration all such amounts payable in respect of the Notes shall become immediately due and payable. |
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(b) If an Event of Default specified in sub-clause (viii) or (ix) of Section 6.01(a) occurs and is continuing, then the principal amount of, premium, if any, and Additional Amounts and accrued and unpaid interest on all of the outstanding Notes shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. |
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(c) At any time after a declaration of acceleration under this Indenture, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in aggregate principal amount of the outstanding Notes, by written notice to the Issuers, the Parent Guarantor and the Trustee, may rescind and annul such declaration of acceleration and its consequences if: |
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(i) the Parent Guarantor or either Issuer has paid or deposited with the Trustee a sum sufficient to pay: |
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(A) all overdue interest and Additional Amounts, if any, on all Notes then outstanding; |
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(B) all unpaid principal of and premium, if any, on any outstanding Notes that have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Notes; |
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(C) to the extent that payment of such interest is lawful, interest upon overdue interest and overdue principal at the rate borne by the Notes; and |
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(D) all sums paid or advanced by the Trustee under this Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; |
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(ii) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and |
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(iii) all Events of Default, other than the non-payment of amounts of principal of, premium, if any, and any Additional Amounts and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.04. |
No such rescission shall affect any subsequent default or impair any right consequent thereon.
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(d) In the event of a declaration of acceleration of the Notes because an Event of Default as described in Section 6.01(a)(v) has occurred and is continuing, the declaration of acceleration of the Notes shall be automatically annulled if the event of default or payment default triggering such Event of Default pursuant to Section 6.01(a)(v) shall be remedied or cured, or waived by the holders of the Debt that gave rise to such Event of Default, or such Debt shall have been discharged in full, within 20 days after the Event of Default arose and if (1) the annulment of the acceleration (if applicable) of the Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, except nonpayment of principal, premium or interest, including Additional Amounts, if any, on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived. |
All rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee without the possession of any of the Notes or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.
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(a) in the payment of the principal of, premium, if any, Additional Amounts, if any, or interest on any Note; or |
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(b) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the holders of 90% of the outstanding Notes. |
Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
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(a) the Trustee may refuse to follow any direction that conflicts with law, this Indenture or that the Trustee determines, without obligation, in good faith may be unduly prejudicial to the rights of Holders not joining in the giving of such direction; |
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(b) the Trustee may refuse to follow any direction that the Trustee determines is unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability; and |
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(c) the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. |
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SECTION 6.06. Limitation on Suits. A Holder may not institute any proceedings or pursue any remedy with respect to this Indenture or the Notes unless: |
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(a) the Holders of at least 30% in aggregate principal amount of outstanding Notes shall have made a written request to the Trustee to pursue such remedy; |
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(b) such Holder or Holders offer the Trustee indemnity and/or security (including by way of pre-funding) reasonably satisfactory to the Trustee against any costs, liability or expense; |
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(c) the Trustee does not comply with the request within 30 days after receipt of the request and the offer of indemnity and/or security (including by way of pre-funding); and |
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(d) during such 30-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes do not give the Trustee a direction that is inconsistent with the request. |
The limitations in the foregoing provisions of this Section 6.06, however, do not apply to a suit instituted by a Holder for the enforcement of the payment of the principal of, premium, if any, Additional Amounts, if any, or interest, if any, on such Note on or after the respective due dates expressed in such Note.
A Holder may not use this Indenture to prejudice the rights of any other Holder or to obtain a preference or priority over another Holder.
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SECTION 6.08. Collection Suit by Trustee. The Issuers covenant that if default is made in the payment of: |
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(a) any installment of interest on any Note when such interest becomes due and payable and such default continues for a period of 30 days, or |
the Issuers shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Notes, the whole amount then due and payable on such Notes for principal (and premium, if any), Additional Amounts, if any and interest, and interest on any overdue principal (and premium, if any) and Additional Amounts, if any and, to the extent that payment of such interest shall be legally enforceable,
upon any overdue installment of interest, at the rate borne by the Notes, and, in addition thereto, such further amount as shall be sufficient to cover the amounts provided for in Section 7.05 and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Issuers fail to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuers or any other obligor upon the Notes and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Issuers or any other obligor upon the Notes, wherever situated.
Nothing herein contained shall be deemed to empower the Trustee to authorize or consent to, or accept or adopt on behalf of any Holder, any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
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SECTION 6.10. Application of Money Collected. If the Trustee collects any money or property pursuant to this Article Six, it shall pay out the money or property in the following order: |
FIRST:to the Trustee and any Agent for amounts due under Section 7.05;
SECOND:to Holders for amounts due and unpaid on the Notes for principal of, premium, if any, interest, if any, and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, interest, if any, and Additional Amounts, if any, respectively; and
THIRD:to the Issuers, any Guarantor or any other obligors of the Notes, as their interests may appear, or as a court of competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 30 days before such record date, the Issuers shall mail to each Holder and the Trustee
a notice that states the record date, the payment date and amount to be paid. This Section 6.10 is subject at all times to the provisions set forth in Section 11.02.
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(a) If an Event of Default has occurred and is continuing of which a Trust Officer of the Trustee has actual knowledge, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. |
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(b) Subject to the provisions of Section 7.01(a), (i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement. In the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine same to determine whether they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein). |
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(c) The Trustee shall not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: |
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(i) this clause (c) does not limit the effect of Section 7.01(b); |
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(ii) the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer of the Trustee unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and |
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(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.02 or Section 6.05. |
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(d) The Trustee and any Paying Agent not be liable for interest on any money received by it except as the Trustee and any Paying Agent may agree in writing with the Issuers or the Subsidiary Guarantors. Money held in trust by the Trustee or the Principal Paying Agent need not be segregated from other funds except to the extent required by law and, for the avoidance of doubt, shall not be held in accordance with the UK Client Money Rules. |
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(e) No provision of this Indenture, the Intercreditor Agreement or any Additional Intercreditor Agreement shall require the Trustee, each Agent, or the Paying Agents to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not assured to it; and |
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(f) Any provisions hereof or of the Intercreditor Agreement or any Additional Intercreditor Agreement relating to the conduct or affecting the liability of or affording protection to the Trustee or each Agent, as the case may be, shall be subject to the provisions of this Section 7.01. |
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(a) Subject to Section 7.01: |
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(i) following the occurrence of a Default or an Event of Default, the Trustee is entitled to require all Agents to act under its direction; |
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(ii) the Trustee may rely conclusively, and shall be protected in acting or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper person; |
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(iii) before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both, which shall conform to Section 12.04. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion and such certificate or opinion will be equal to complete authorization; |
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(iv) the Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care by it hereunder; |
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(v) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee security and/or indemnity (including by way of pre-funding) satisfactory to the Trustee against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction; |
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(vi) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from either Issuer will be sufficient if signed by an officer of such Issuer; |
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(vii) the Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; |
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(viii) whenever, in the administration of this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement, the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate; |
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(ix) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuers personally or by agent or attorney; |
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(x) the Trustee shall not be required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture; |
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(xi) in the event the Trustee receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal |
amount of the Notes then outstanding, pursuant to the provisions of this Indenture, the Trustee, in its discretion, may determine what action, if any, will be taken; |
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(xii) the permissive rights of the Trustee to take the actions permitted by this Indenture will not be construed as an obligation or duty to do so; |
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(xiii) delivery of reports, information and documents to the Trustee under Section 4.19 is for informational purposes only and the Trustee’s receipt of the foregoing will not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Parent Guarantor’s or any Restricted Subsidiary’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates); |
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(xiv) the rights, privileges, protections, immunities and benefits given to the Trustee in this Indenture, including, without limitation, its rights to be indemnified, are extended to, and will be enforceable by, the Trustee in each of its capacities hereunder, by the Registrar, the Agents, and each agent, custodian and other Person employed to act hereunder; |
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(xv) the Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel will, subject to Section 7.01(c), be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; |
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(xvi) the Trustee shall have no duty to inquire as to the performance of the covenants of the Parent Guarantor and/or its Restricted Subsidiaries in Article Four; |
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(xvii) the Trustee shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Indenture or under applicable law or regulation with respect to any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Notes, but may at its sole discretion, choose to do so; |
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(xviii) in no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of, or caused by, directly or indirectly, forces beyond its control, including, without limitation, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances; and |
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(xix) the Trustee shall not under any circumstance be liable for any consequential loss or punitive damages (including loss of business, goodwill, opportunity or profit of any kind) of the Issuers, any Guarantor or any Restricted Subsidiary. |
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(b) The Trustee may request that the Issuers deliver an Officer’s Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. |
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(c) The Trustee is not required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture or the Notes. |
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(d) The Trustee will not be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control. |
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(e) No provision of this Indenture shall require the Trustee to do anything which, in its opinion, may be illegal or contrary to applicable law or regulation. |
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(f) The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York. |
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(g) The Trustee may assume without inquiry in the absence of actual knowledge that the Issuers are duly complying with their obligations contained in this Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Notes has occurred. |
The Issuers, failing which the Guarantors, shall indemnify the Trustee against any and all loss, liability or expense (including attorneys’ fees and expenses) incurred by it without willful misconduct or negligence on its part arising out of or in connection with the administration of this trust and the performance of its duties hereunder (including the costs and expenses of enforcing this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement against the Issuers and the Guarantors
(including this Section 7.05) and defending itself against any claim, whether asserted by the Issuers, the Guarantors, any Holder or any other Person, or liability in connection with the execution and performance of any of their powers and duties hereunder). The Trustee shall notify the Issuers promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Issuers shall not relieve the Issuers or any Guarantor of its obligations hereunder. The Issuers shall, at the sole discretion of the Trustee, defend the claim and may cooperate and may participate at the Issuers’ expense in such defense. Alternatively, the Trustee may at its option have separate counsel of its own choosing and the Issuers shall pay the properly incurred fees and expenses of such counsel. The Issuers need not pay for any settlement made without its consent, which consent may not be unreasonably withheld. The Issuers shall not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
To secure the Issuers’ payment obligations in this Section 7.05, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, in its capacity as Trustee, except money or property held in trust to pay principal of, premium, if any, additional amounts, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of all Notes under this Indenture.
When the Trustee incurs expenses after the occurrence of a Default specified in sub-clauses (viii) or (ix) of Section 6.01(a) with respect to the Issuers, the Guarantors, or any Restricted Subsidiary, the expenses are intended to constitute expenses of administration under Bankruptcy Law.
The Issuers’ obligations under this Section 7.05 and any claim or Lien arising hereunder shall survive the resignation or removal of any Trustee, the satisfaction and discharge of the Issuers’ obligations pursuant to Article Eight and any rejection or termination under any Bankruptcy Law, and the termination of this Indenture.
The Trustee may resign at any time without giving any reason by so notifying the Issuers. The Holders of a majority in outstanding principal amount of the outstanding Notes may remove the Trustee by so notifying the Trustee and the Issuers. The Issuers shall remove the Trustee if:
If the Trustee resigns or is removed, or if a vacancy exists in the office of Trustee for any reason, the Issuers shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Issuers. If the successor Trustee does not deliver its written acceptance required by the next succeeding paragraph of this Section 7.06 within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the Holders of a majority in principal amount of the outstanding Notes may, at the expense of the Issuers, petition any court of competent jurisdiction for the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Issuers. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee; provided that all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.05.
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the Holders of at least 30% in outstanding principal amount of the Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee at the expense of the Issuers. Without prejudice to the right of the Issuers to appoint a successor Trustee in accordance with the provisions of this Indenture, the retiring Trustee may appoint a successor Trustee at any time prior to the date on which a successor Trustee takes office.
If the Trustee fails to comply with Section 7.08, any Holder who has been a bona fide Holder of a Note for at least six months may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section 7.06, the Issuers’ and the Guarantors’ obligations under Section 7.05 shall continue for the benefit of the retiring Trustee.
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(a) It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture, and in particular in case of the enforcement thereof on Default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to |
the Trustee or hold title to the properties, in trust, as herein granted or take any action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an individual or institution as a separate or co-trustee. |
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(b) In the event that the Trustee appoints an additional individual or institution as a separate or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and Lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co-trustee but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and only to the extent that the Trustee by the laws of any jurisdiction is incapable of exercising such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of them. |
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(c) Should any instrument in writing from the Issuers be required by the separate or co-trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to him or it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall to the extent permitted by the laws of the State of New York and the jurisdictions of organization of the Issuers, on request, be executed, acknowledged and delivered by the Issuers; provided that if an Event of Default shall have occurred and be continuing, if the Issuers do not execute any such instrument within 15 days after request therefore, the Trustee shall be empowered as an attorney-in-fact for the Issuers to execute any such instrument in the Issuers’ name and stead. In case any separate or co-trustee or a successor to either shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate or co-trustee. |
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(d) Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: |
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(i) all rights and powers, conferred or imposed upon the Trustee shall be conferred or imposed upon and may be exercised or performed by such separate trustee or co-trustee; and |
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(ii) no trustee hereunder shall be liable by reason of any act or omission of any other trustee hereunder. |
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(e) Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article Seven. |
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(f) Any separate trustee or co-trustee may at any time appoint the Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successors trustee. |
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(a) Any Agent may resign its appointment hereunder at any time without the need to give any reason and without being responsible for any costs associated therewith by giving to the Issuers and the Trustee and (except in the case of resignation of the Principal Paying Agent) the Principal Paying Agent 30 |
days’ written notice to that effect (waivable by the Issuers and the Trustee); provided that in the case of resignation of the Principal Paying Agent no such resignation shall take effect until a new Principal Paying Agent (approved in advance in writing by the Trustee) shall have been appointed by the Issuers to exercise the powers and undertake the duties hereby conferred and imposed upon the Principal Paying Agent. Following receipt of a notice of resignation from any Agent, the Issuers shall promptly give notice thereof to the Holders in accordance with Section 12.02. Such notice shall expire at least 30 days before or after any due date for payment in respect of the Notes. |
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(b) If any Agent gives notice of its resignation in accordance with this Section 7.10 and a replacement Agent is required and by the tenth day before the expiration of such notice such replacement has not been duly appointed, such Agent may itself appoint as its replacement any reputable and experienced financial institution. Immediately following such appointment, the Issuers shall give notice of such appointment to the Trustee, the remaining Agents and the Holders whereupon the Issuers, the Trustee, the remaining Agents and the replacement Agent shall acquire and become subject to the same rights and obligations between themselves as if they had entered into an agreement in the form mutatis mutandis of this Indenture. |
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(c) Upon its resignation becoming effective the Principal Paying Agent shall forthwith transfer all moneys held by it hereunder hereof to the successor Principal Paying Agent or, if none, the Trustee or to the Trustee’s order, but shall have no other duties or responsibilities hereunder, and shall be entitled to the payment by the Issuers of its remuneration for the services previously rendered hereunder and to the reimbursement of all reasonable expenses (including legal fees) incurred in connection therewith. |
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(a) Actions of Agents. The rights, powers, duties and obligations and actions of each Agent under this Indenture are several and not joint or joint and several. |
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(b) Agents of Trustee. The Issuers and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuers and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee. Prior to receiving such written notification from the Trustee, the Agents shall be the agents of the Issuers and need have no concern for the interests of the Holders. |
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(c) Funds held by Agents. The Agents will hold all funds as banker subject to the terms of this Indenture and as a result, such money will not be held in accordance with the rules established by the Financial Conduct Authority in the Financial Conduct Authority’s Handbook of rules and guidance from time to time in relation to client money. |
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(d) Publication of Notices. Any obligation the Agents may have to publish or mail notices to Holders of Global Notes on behalf of the Issuers will be met upon delivery of the notice to Euroclear and/or Clearstream. |
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(e) Instructions. In the event that instructions given to any Agent are not reasonably clear, then such Agent shall be entitled to seek clarification from the Issuers or other party entitled to give the Agents instructions under this Indenture by written request promptly, and in any event within one Business Day of receipt by such Agent of such instructions. If an Agent has sought clarification in accordance with this Section 7.11, then such Agent shall be entitled to take no action until such clarification is provided, and shall not incur any liability for not taking any action pending receipt of such clarification. |
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(f) No Fiduciary Duty. No Agent shall be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust, for or with any person other than the Issuers. |
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(g) Mutual Undertaking. Each Party shall, within ten Business Days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this Section 7.11(g) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality. For purposes of this Section 7.11(g), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature. |
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(h) Tax Withholding. |
(i) The Issuers shall notify each Agent in the event that they determine that any payment to be made by an Agent under the Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated; provided, however, that the Issuers’ obligations under this Section 7.11(h) shall apply only to the extent that such payments are so treated by virtue of characteristics of either Issuer, the Notes, or both.
(ii) Notwithstanding any other provision of this Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuers the amount so deducted or withheld, in which case, the Issuers shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.11(h)(ii).
defeasance”). For this purpose, such legal defeasance means that the Issuers shall be deemed to have paid and discharged the entire Debt represented by the outstanding Notes and to have satisfied all their other obligations under the Notes and this Indenture (and the Trustee, at the expense of the Issuers, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive, solely from the trust fund described in Section 8.08 and as more fully set forth in such Section, payments in respect of the principal of (and premium, if any, on) and interest on such Notes when such payments are due, (b) the provisions set forth in Section 8.06, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Issuers’ and the Guarantors’ obligations in connection therewith and (d) this Section 8.02. Subject to compliance with this Article Eight, the Issuers and the Parent Guarantor may exercise their option under this Section 8.02 notwithstanding the prior exercise of their option under Section 8.03 with respect to the Notes. If the Issuers or the Parent Guarantor exercises their legal defeasance option, payment of the Notes may not be accelerated because of an Event of Default. |
If the Issuers exercise their legal defeasance option, each Guarantor, if any, shall be released from all its obligations under its Guarantee, and the Trustee shall execute a release of such Guarantee.
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SECTION 8.04. Conditions to Defeasance. In order to exercise either legal defeasance or covenant defeasance: |
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(b) in the case of an election under Section 8.02, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee stating that (A) the U.S. Internal Revenue Service has either published a revenue ruling or issued to the Issuers a private letter ruling, or (B) since the Issue Date, there has been a change in applicable U.S. federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result |
of such legal defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred; |
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(c) in the case of an election under Section 8.03, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee to the effect that the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred; |
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(e) such legal defeasance or covenant defeasance shall not cause the Trustee to have a conflicting interest as defined in this Indenture with respect to any of the Issuers’ securities; |
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(k) the Issuers or the Parent Guarantor shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the legal defeasance or the covenant defeasance, as the case may be, have been complied with. |
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(l) If the funds deposited with the Trustee to effect covenant defeasance are insufficient to pay the principal of, premium, if any, and interest on the Notes when due because of any acceleration occurring after an Event of Default, then the Issuers and the Guarantors shall remain liable for such payments. |
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(a) the Issuers or the Parent Guarantor has irrevocably deposited or caused to be deposited with the Trustee (or such other party as directed by the Trustee) as funds in trust for such purpose an amount in cash in pounds sterling, U.K. Government Securities or a combination thereof sufficient to pay and discharge the entire Debt on such Notes not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and accrued and unpaid interest, Additional Amounts, if any, to the date of such deposit (in the case of Notes which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be and the Issuers or the Parent Guarantor shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of such Notes at Maturity or on the Redemption Date, as the case may be, and either: |
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(i) all Notes previously authenticated and delivered (other than lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuers and thereafter repaid to the Issuers or discharged from such trust, as provided in Section 8.07) have been delivered to the Trustee for cancellation; or |
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(ii) all Notes not theretofore delivered to the Trustee for cancellation (A) have become due and payable (by reason of the mailing of a notice of redemption or otherwise) or (B) will become due and payable at Stated Maturity within one year or (C) 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 Issuers’ name, and at the Issuers’ expense; |
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(b) the Issuers or the Parent Guarantor has paid or caused to be paid all other amounts payable by the Issuers under this Indenture; and |
acknowledge in writing the discharge of all of the Issuers’, Parent Guarantor’s and Subsidiary Guarantor’s obligations under this Indenture except for those surviving obligations specified in this Article Eight. |
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(a) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), the Guarantors and the Trustee may modify, amend or supplement this Indenture, any Guarantee or the Notes without notice to or consent of any Holder: |
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(i) to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants herein and in the Notes; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with the provisions of Article Five; provided, further, that such transaction need not be of a specific type identified in such covenant (it being understood that in the case of any other transaction, the requirements of such covenant shall apply mutatis mutandis); |
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(ii) to add to the covenants of the Issuers, any Guarantor or any other obligor upon the Notes for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon the Notes, as applicable, herein, in the Notes or in any Guarantees; |
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(iii) to cure any ambiguity, or to correct or supplement any provision herein, in the Notes or any Guarantees that may be defective or inconsistent with any other provision herein or in the Notes or any Guarantee or to make any other provisions with respect to matters or questions arising under this Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect; |
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(iv) to conform the text of this Indenture, the Guarantees, or the Notes to any provision of the “Description of the Notes” in the Offering Memorandum to the extent that such provision in such “Description of the Notes” was intended to be a verbatim recitation of a provision of this Indenture, the Guarantees or the Notes; |
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(v) to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in this Indenture and to add a Subsidiary Guarantor or other guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s)); |
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(vi) to evidence and provide the acceptance of the appointment of a successor Trustee hereunder; |
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(vii) to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations hereunder, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to this Indenture or otherwise; or |
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(viii) to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in this Indenture. |
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(b) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), the Parent Guarantor, the Trustee and the |
Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under this Indenture may supplement this Indenture to add a Subsidiary Guarantor or other Guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other Guarantor(s)) in each case without notice to or consent of any Holder. |
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(c) In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate. |
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(a) Except as provided in Section 9.02(b) and Section 6.04 and without prejudice to Section 9.01, the Issuers, the Guarantors and the Trustee may: |
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(i) modify, amend or supplement this Indenture or the Notes; or |
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(ii) waive compliance by the Issuers with any provision of this Indenture or the Notes, |
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes); provided that, if any amendment, waiver, or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
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(b) Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 and an amendment, modification or supplement pursuant to Section 9.01, may: |
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(i) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note; |
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(ii) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note; |
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(iii) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable; |
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(iv) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date); |
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(v) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver of certain provisions of this Indenture; |
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(vi) modify any of the provisions of this Article Nine or any provisions herein relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions |
of this Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby; |
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(vii) make any change to the Intercreditor Agreement (and/or any Additional Intercreditor Agreement) or any provisions of this Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders; or |
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(viii) make any change in Section 4.12 that adversely affects the rights of any Holder or amend the terms of the Notes or this Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture. |
(c)The consent of the Holders will not be necessary under this Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under this Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
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(b) The aggregate principal amount of the Notes, at any date of determination, shall be the principal amount of the Notes at such date of determination. With respect to any matter requiring consent, waiver, approval or other action of the Holders of a specified percentage of the principal amount of all the Notes, such percentage shall be calculated, on the relevant date of determination, by dividing (i) the principal amount, as of such date of determination, of Notes, the Holders of which have so consented by (b) the aggregate principal amount, as of such date of determination, of the Notes then outstanding, in each case, as determined in accordance with the preceding sentence, Section 2.08 and Section 2.09 of this Indenture. Any such calculation made pursuant to this Section 9.07(b) shall be made by the Issuers and delivered to the Trustee pursuant to an Officer’s Certificate. |
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(a) (i) The Parent Guarantor hereby fully and, subject to the limitations on the effectiveness and enforceability set forth in Section 10.04, unconditionally guarantees, on a senior, unsecured, joint and several basis, and (ii) each Subsidiary Guarantor by execution of a supplemental indenture hereto, fully and, subject to the limitations on the effectiveness and enforceability set forth in such supplemental indenture, unconditionally guarantees, on a senior subordinated, unsecured, joint and several basis, in each case to each Holder and to the Trustee and its successors and assigns on behalf of each Holder, the full payment of principal of, premium, if any, interest, if any, and Additional Amounts, if any, on, and all other monetary obligations of the Issuers under this Indenture and the Notes (including obligations to the Trustee and the obligations to pay Additional Amounts, if any) with respect to each Note authenticated and delivered by the Trustee or its agent pursuant to and in accordance with this Indenture, in accordance with the terms of this Indenture (all the foregoing being hereinafter collectively called the “Obligations”). The Guarantors further agree that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from the Guarantors and that the Guarantors shall remain bound under this Article Ten notwithstanding any extension or renewal of any Obligation. All payments under each Guarantee will be made in pounds sterling. |
exercising its rights under a Guarantee (including, for the avoidance of doubt, any right which a Guarantor may have to require the seizure and sale of the assets of such Issuer to satisfy the outstanding principal of, interest on or any other amount payable under each Note prior to recourse against such Guarantor or its assets), protest or notice with respect to any Note or the Debt evidenced thereby and all demands whatsoever, and each covenant that their Guarantee will not be discharged with respect to any Note except by payment in full of the principal thereof and interest thereon or as otherwise provided in this Indenture, including Section 10.04. If at any time any payment of principal of, premium, if any, interest, if any, or Additional Amounts, if any, on such Note is rescinded or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of either Issuer, the Guarantors’ obligations hereunder with respect to such payment shall be reinstated as of the date of such rescission, restoration or returns as though such payment had become due but had not been made at such times. |
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(c) The Guarantors also agree to pay any and all costs and expenses (including reasonable attorneys’ fees) Incurred by the Trustee or any Holder in enforcing any rights under this Section 10.01. |
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(d) Each Subsidiary Guarantor agrees and each Holder by accepting a Note agrees, for the benefit of the holders of Senior Debt from time to time of such Subsidiary Guarantor, that prior to the date upon which any Senior Debt of a Subsidiary Guarantor has been unconditionally discharged in full, the obligations of such Subsidiary Guarantor under its Guarantee may not become due, and neither the Holders nor the Trustee may take any Enforcement Action against such Subsidiary Guarantor without the prior consent of the applicable Senior Agent or Senior Agents unless: |
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(i) an Event of Default specified in sub-clause (viii) or (ix) of Section 6.01(a) has occurred in relation to such Subsidiary Guarantor; or |
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(ii) the holders of Designated Senior Debt have taken any Enforcement Action in relation to such Subsidiary Guarantor; or |
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(iii) a Default has occurred under the Notes; and |
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(A) the Holders or the Trustee has notified the applicable Senior Agents; and |
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(B) a period of not less than 90 days (in the case of a default specified under sub-clause (i) or (ii) of Section 6.01(a) or 179 days (in the case of a non-payment default specified under sub-clauses (iii), (iv), (v), (vi) or (vii) of Section 6.01(a)) has passed from the date the applicable Senior Agents were first notified of the Default (a “Standstill Period”); and |
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(C) at the end of the Standstill Period, the Default is continuing and has not been waived by the Holders. |
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(e) Each Guarantee of a Guarantor hereunder is on parity with such Guarantor’s guarantee of the Existing Unsecured Notes. |
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(a) Each Guarantor shall be subrogated to all rights of the Holders against the Issuers in respect of any amounts paid to such Holders by such Guarantor pursuant to the provisions of its Guarantee. |
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(b) The Guarantors agree that they shall not be entitled to any right of subrogation in relation to the Holders in respect of any Obligations guaranteed hereby until payment in full of all Obligations. The |
Guarantors further agree that, as between them, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the Obligations guaranteed hereby may be accelerated as provided in Section 6.02 for the purposes of the Guarantees herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such Obligations as provided in Section 6.02, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purposes of this Section 10.02 subject to Article Eleven. |
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(a) upon any sale or disposition of (i) Capital Stock of a Subsidiary Guarantor following which such Subsidiary Guarantor is no longer a Restricted Subsidiary or, (ii) all or substantially all of the properties and assets of a Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary that does not violate Section 4.09; |
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(b) in the event that all of the Capital Stock of such Subsidiary Guarantor is sold or otherwise disposed of pursuant to an enforcement of the security over the Capital Stock of such Subsidiary Guarantor in accordance with the terms of the Intercreditor Agreement and any Additional Intercreditor Agreement; |
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(c) upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary; |
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(d) upon legal defeasance under Section 8.02, covenant defeasance under Section 8.03 or upon satisfaction and discharge under Section 8.05; |
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(e) in the circumstances set forth in Section 5.01(e); and |
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(f) as described in Article Nine. |
Each Subsidiary Guarantor agrees and each Holder by accepting a Note agrees, that the provisions of Section 10.03(b) are for the benefit of and enforceable by the Holders of Senior Debt of such Subsidiary Guarantor.
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(a) Each Guarantee is limited to (i) an amount not to exceed the maximum amount that can be guaranteed by the Guarantor that gave such Guarantee without rendering such Guarantee, as it relates to such Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally or (ii) the maximum amount otherwise permitted by law. |
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(b) Ireland. The Guarantee by a Guarantor organized under the laws of Ireland shall not be lawful if it constitutes financial assistance to any person for the purpose of an acquisition by subscription, purchase, exchange or otherwise of any shares in such Guarantor or a holding company of such Guarantor contrary to Section 82 of the Companies Act 2014. |
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(a) The holders of Senior Debt of each Subsidiary Guarantor will be entitled to receive payment in full in cash of all obligations in respect of such Senior Debt (including interest after the commencement of any proceedings in respect thereof at the rate specified therein whether or not such interest is an allowed claim enforceable against such Subsidiary Guarantor under applicable Bankruptcy Law) before the Holders of Notes will be entitled to receive any payment from such Subsidiary Guarantor (including, without limitation, as a result of redemption, purchase or other acquisition) with respect to its Subsidiary Guarantee (except that Holders of Notes may receive and retain Permitted Junior Securities and payments made from the trust (if any) described in Section 8.04), in the event of any payment, distribution, division or application, partial or complete, voluntary or involuntary, by operation of law or otherwise, of all or any part of the assets of any kind or character or the proceeds thereof to creditors of such Subsidiary Guarantor in any: |
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(i) liquidation or dissolution of such Subsidiary Guarantor; |
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(ii) insolvency, bankruptcy, reorganization, composition, receivership, administration, voluntary arrangement or similar proceeding relating to such Subsidiary Guarantor or its property; |
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(iii) assignment for the benefit of the creditors of such Subsidiary Guarantor; or |
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(iv) marshaling of such Subsidiary Guarantor’s assets and liabilities. |
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(b) Notwithstanding the foregoing, any payment or distribution of any kind or character (other than Permitted Junior Securities and payments made from trust (if any) described in Section 8.04) and all and any rights in respect thereof, whether in cash, securities or other property which is payable or deliverable upon or with respect to the Subsidiary Guarantee owed by a Subsidiary Guarantor, or any part thereof, by a liquidator, administrator or receiver (or the equivalent thereof) of such Subsidiary Guarantor (“rights”) made to or paid to, or received by the Trustee, or to which the Trustee is entitled, before all amounts with respect to the Senior Debt of such Subsidiary Guarantor are paid in full and, with respect to a payment or distribution to the Trustee, which the Trustee or such Holder has actual knowledge that such payment or distribution was so prohibited prior to distributing that payment in accordance with the terms of this Indenture, shall be held in trust by the Trustee, for the holders of Senior Debt of such Subsidiary Guarantor and shall forthwith be paid or, as the case may be, transferred or assigned to the applicable Senior Agent or any other proper representative of the holders of the relevant Senior Debt. |
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(c) If the trust referred to in clause (b) above fails or cannot be given effect to, or the Trustee (and any agent or trustee on its behalf) receives and retains any such payment or distribution (and has actual knowledge that such payment or distribution was so prohibited) or the Issuer, will pay over such rights in the form received to the Senior Agent or any other proper representative of the holders of the relevant Senior Debt to be applied against the relevant Senior Debt (after taking into account any concurrent payment or distribution being made to the holders of such Senior Debt). |
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(a) a payment default on Designated Senior Debt of such Subsidiary Guarantor has occurred and is continuing beyond any applicable grace period; or |
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(b) any other default occurs and is continuing on any Designated Senior Debt of such Subsidiary Guarantor that permits the holders of that Designated Senior Debt to accelerate its maturity and the Trustee receives a notice of such default (a “Payment Blockage Notice”) from the Issuer or the holders of such Designated Senior Debt. |
Payments on any such Guarantee of a Subsidiary Guarantor shall and will be resumed:
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(i) in the case of a payment default, when such default is cured or waived; or |
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(ii) in the case of a non-payment default, upon the earlier of the date on which such non-payment default is cured or waived and 179 days after the date on which the applicable Payment Blockage Notice is received, unless the maturity of any Designated Senior Debt has been accelerated. |
Neither the Trustee, the Issuers nor any such Subsidiary Guarantor shall be required to give effect to any new Payment Blockage Notice that may be delivered unless and until (A) 360 days have elapsed since the delivery of the immediately prior Payment Blockage Notice and (B) all scheduled payments of principal, premium, if any, and interest on the Notes that have come due have been paid in full in cash. No non-payment default that existed or was continuing on the date of delivery of a Payment Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice.
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SECTION 11.05. Trustee to Effectuate Subordination of Each Subsidiary Guarantee; Intercreditor Agreement. |
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(a) Each Holder by accepting the Notes guaranteed by each Subsidiary Guarantor authorizes and expressly directs the Trustee on such Holder’s behalf to take such action as may be necessary or appropriate to acknowledge or effectuate the subordination of such Subsidiary Guarantor’s Guarantee between the Holders and the holders of Senior Debt of such Subsidiary Guarantor as provided in Section 10.01(d) and this Article Eleven, including by entering into the Intercreditor Agreement or any Additional Intercreditor Agreement or deed in favor of holders of Senior Debt and appoints the Trustee as attorney-in-fact for any and all such purposes, and the Trustee shall not be required to take any actions inconsistent with this Indenture. |
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(b) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), any Subsidiary Guarantor and the Trustee may, without notice to or consent of any Holder, enter into any Additional Intercreditor Agreement to give effect to the ranking and subordination provisions in Section 10.01(d) and this Article Eleven hereof for the benefit of any holders of Designated Senior Debt of any Subsidiary Guarantor. Each Holder, by accepting its Note, shall be deemed to have: |
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(i) appointed and authorized the Trustee to give effect to such ranking and subordination provisions; |
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(ii) authorized the Trustee to become a party to any Additional Intercreditor Agreement; |
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(iii) agreed to be bound by such subordination provisions and the provisions of any Additional Intercreditor Agreement that do not materially adversely affect the rights of Holders; and |
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(iv) irrevocably appointed the Trustee to act on its behalf to enter into and comply with such subordination provisions and the provisions of any Additional Intercreditor Agreements. |
For the avoidance of doubt, the parties hereto agree that in the event of conflict between the provisions of this Article Eleven and the provisions of the Intercreditor Agreement or any Additional Intercreditor Agreement, the Intercreditor Agreement or any Additional Intercreditor Agreement shall prevail.
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(a) Each Holder by accepting a Note acknowledges and agrees that the foregoing subordination provisions in Section 10.01(d) and this Article Eleven are intended to be an inducement and a consideration to any and all holders of existing and future Senior Debt of a Subsidiary Guarantor to acquire and continue to hold, or to continue to hold such Senior Debt and such holders of Senior Debt shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Debt and no amendment or modification of the provisions contained herein shall diminish the rights of any such holder of Senior Debt unless such holder shall have agreed in writing thereto. |
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(b) The Parent Guarantor and each Subsidiary Guarantor agree, for the benefit of each existing and future holder of Senior Debt that, as long as any Existing Ardagh Bonds or any amounts under the indentures governing the Existing Ardagh Bonds remain outstanding, no amendment or modification of the provisions of such indentures shall diminish the rights of any such holder of Senior Debt unless such holder shall have agreed in writing thereto. |
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SECTION 11.08. Trustee’s Compensation Not Prejudiced. Nothing in this Article Eleven shall apply to amounts due to the Trustee pursuant to other Sections of this Indenture. |
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(a) Each Subsidiary Guarantor shall give prompt written notice to the Trustee of any fact known to such Subsidiary Guarantor which would prohibit the making of any payment to or by the Trustee in respect of its Subsidiary Guarantee. Notwithstanding the provisions of this Article Eleven or any other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of any facts which would prohibit the making of any payment to or by the Trustee in respect of any Subsidiary Guarantee, unless and until a Trust Officer of the Trustee shall have received written notice thereof from the relevant Subsidiary Guarantor, the representative of the holders of Senior Debt of such Subsidiary Guarantor or from any trustee, fiduciary or agent therefor; and, prior to the receipt of any such written notice, the Trustee shall be entitled in all respects to assume that no such facts exist; provided that, if a Trust Officer of the Trustee shall not have received the notice provided for in this Section at least three Business Days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of (and premium, if any) or interest on any Note), then anything herein contained to the contrary notwithstanding, the Trustee shall have full power and authority to receive such money and to apply the same to the purpose for which such money was received and shall not be affected by any notice to the contrary which may be received by it within three Business Days prior to such date. |
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(b) The Trustee shall be entitled to rely on the delivery to it of a written notice by a Person representing himself to be a holder of Senior Debt of a Subsidiary Guarantor (or a trustee, fiduciary or agent therefor) to establish that such notice has been given by a holder of Senior Debt of a Subsidiary Guarantor (or a trustee, fiduciary or agent therefor). In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any Person as a holder of Senior Debt of a Subsidiary Guarantor to participate in any payment or distribution pursuant to this Article Eleven, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Debt of the relevant Subsidiary Guarantor held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article Eleven and, if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. |
of Article Eight hereof and not in violation of Section 11.03 for the payment of principal of (and premium, if any) and interest on any Subordinated Guarantee shall not be subordinated to the prior payment of any Senior Debt of the Subsidiary Guarantor that granted such Subsidiary Guarantee or subject to the restrictions set forth in this Article Eleven, and none of the Holders shall be obligated to pay over any such amount to such Subsidiary Guarantor or any holder of Senior Debt of such Subsidiary Guarantor or any other creditor of such Subsidiary Guarantor. |
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(a) Notwithstanding anything to the contrary in this Indenture, upon the sale or disposition directly or indirectly of the Capital Stock of the U.S. Issuer pursuant to an enforcement by a security agent in accordance with the Intercreditor Agreement (or any Additional Intercreditor Agreement) and the indentures and/or agreements governing Senior Debt (a “Holdings USA Disposition”), the obligations of the U.S. Issuer under the Notes and this Indenture will be automatically and unconditionally released (and thereupon shall terminate and be discharged and be of no further effect); provided that each other guarantee by the U.S. Issuer in respect of any Credit Facility and any other capital markets debt of the Parent Guarantor or any of its subsidiaries has been released (or is released simultaneously upon such Holdings USA Disposition). Upon a Holdings USA Disposition, the Irish Issuer shall be the sole Issuer under the Notes and this Indenture, and the Notes and this Indenture shall remain in full force and effect and any reference in this indenture, the Notes and the Intercreditor Agreement (or any Additional Intercreditor Agreement) to the “Issuers” or the U.S. Issuer shall be deemed to be references only to the “Issuer” or the Irish Issuer, mutatis mutandis. |
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(b) The Parent Guarantor shall publish a notice of a Holdings USA Disposition described in clause (a) above in accordance with the provisions described under Section 12.02 and, so long as the rules of the Irish Stock Exchange so require, notify such exchange of a Holdings USA Disposition. |
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(c) The U.S. Issuer agrees, and each Holder by accepting a Note agrees, that the provisions of this Section 12.01 are for the benefit of and enforceable by the security agent referred to therein. |
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(a) Any notice or communication shall be in writing and delivered in person or mailed by first class mail or sent by facsimile transmission addressed as follows: |
if to the Irish Issuer:
Ardagh House
South County Business Park
Leopardstown
Dublin 18
D18 PX68
Ireland
Facsimile: +353 1 668 3416
Attention: Finance Director
if to the U.S. Issuer:
The Corporation Trust Company
1209 Orange Street
Wilmington, Delaware 19801
United States
if to the Guarantors:
Ardagh Group S.A.
56, rue Charles Martel
L-2134 Luxembourg
Luxembourg
Facsimile: +352 26 38 94 44
Attention: Cindy Cooper
With copies to:
Shearman & Sterling
9 Appold Street
London, EC2A 2AP
United Kingdom
Telephone: +44 (0)20 7655 5000
Facsimile: +44 (0)20 7655 5500
Attention: Mr. Apostolos Gkoutzinis
if to the Trustee, Principal Paying Agent or Transfer Agent:
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
(i) for the Trustee
Facsimile: +44 20 7500 5877
Attention: The Directors, Agency & Trust
(ii) for the Principal Paying Agent
Facsimile: +353 1 622 2210
Attention: PPA desk
(iii) for the Transfer Agent
Facsimile: +353 1 622 2031
Attention: Transfer Agent
The Issuers, the Guarantors or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
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(b) Notices regarding the Notes shall be: |
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(i) delivered to Holders electronically or mailed by first-class mail, postage paid, and, if and so long as the Notes are listed on the Irish Stock Exchange and the rules and regulations of such exchange so require, published in a newspaper having a general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of the Irish Stock Exchange, posted on the official website of the Irish Stock Exchange (www.ise.ie)); and |
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(ii) in the case of certificated Notes, mailed to each Holder by first-class mail at such Holder’s respective address as it appears on the registration books of the Registrar. |
Notices given by first-class mail shall be deemed given five calendar days after mailing and notices given by publication shall be deemed given on the first date on which publication is made. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
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(c) If and so long as the Notes are listed on any securities exchange instead of or in addition to the Irish Stock Exchange, notices shall also be given in accordance with any applicable requirements of such alternative or additional securities exchange. |
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(d) If and so long as the Notes are represented by Global Notes, notices may be given by delivery of the relevant notices to Euroclear and Clearstream for communication to entitled account holders in substitution for the mailing required under Section 12.02(b)(i). |
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(e) Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. |
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(b) an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with. |
Any Officer’s Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless the officer signing such certificate knows, or in the exercise of reasonable care should know, that such Opinion of Counsel with respect to the matters upon which such Officer’s Certificate is based are erroneous. Any Opinion of Counsel may be based and may state that it is so based, insofar as it relates to factual matters, upon certificates of public officials or an Officer’s Certificate stating that the information with respect to such factual matters is in the possession of the Issuers, unless the counsel signing such Opinion of Counsel knows, or in the exercise of reasonable care should know, that the Officer’s Certificate with respect to the matters upon which such Opinion of Counsel is based are erroneous.
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SECTION 12.04. Statements Required in Certificate or Opinion. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: |
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(a) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; |
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(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; |
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(c) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and |
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(d) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. |
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SECTION 12.07. Governing Law. THIS INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. |
convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof. |
Definitions:
"Liability" means any liability of Citigroup Global Markets Deutschland AG to the Issuers arising under or in connection with the Agreement;
"Resolution Authority" means the German Federal Agency for Financial Markets Stabilisation (Bundesanstalt für Finanzmarktstabilisierung), or any other body which has authority to exercise any Write-down and Conversion Powers;
"Write-down and Conversion Powers" means any write-down, conversion, transfer, modification or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in Germany, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time, including but not limited to the German Recovery and Resolution Act (Sanerungs- und Abwicklungsgesetz) as amended from time to time, and the instruments, rules and standards created thereunder, pursuant to which:
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(a) any obligation of Citigroup Global Markets Deutschland AG (or other affiliate of such entity) can be reduced, cancelled, modified or converted into shares, other securities or other obligations of such entity or any other person (or suspended for a temporary period); and |
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(b) any right in a contract governing an obligation of Citigroup Global Markets Deutschland AG may be deemed to have been exercised. |
Clause:
The Issuers acknowledge and accept that, notwithstanding any other provision of the Agreement or any other agreement, arrangement or understanding between the parties:
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(a) any Liability may be subject to the exercise of Write-down and Conversion Powers by the Resolution Authority; |
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(a) The Issuers will be bound by the effect of any application of any Write-down and Conversion Powers in relation to any Liability and in particular (but without limitation) by: |
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(i) any reduction in the principal amount, in full or in part, or outstanding amount due (including any accrued but unpaid interest) due in respect of any Liability; and |
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(i) any conversion of all or part of any Liability into ordinary shares or other instruments of ownership of Citigroup Global Markets Deutschland AG or any other person; |
that may result from any exercise of any Write-down and Conversion Powers in relation to any Liability;
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(a) the terms of the Agreement and the rights of the Issuers hereunder may be varied, to the extent necessary, to give effect to any exercise of any Write-down and Conversion Powers in relation to any Liability and the Issuers will be bound by any such variation; |
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(a) ordinary shares or other instruments of ownership of Citigroup Global Markets Deutschland AG or any other person may be issued to or conferred on Issuers as a result of any exercise of any Write-down and Conversion Powers in relation to any Liability; |
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
ARDAGH PACKAGING FINANCE PLC,
as Irish Issuer
By:
Name:
Title:
ARDAGH HOLDINGS USA INC.
as U.S. Issuer
By:
Name:
Title:
ARDAGH GROUP S.A.,
as Parent Guarantor
By:
Name:
Title:
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Principal Paying Agent and Transfer Agent
By:
Name:
Title:
CITIGROUP GLOBAL MARKETS
DEUTSCHLAND AG,
as Registrar
By:
Name:
Title:
Schedule I
AGREED SECURITY PRINCIPLES
1.agreed security principles
The guarantees to be provided under and in connection with this Indenture will be given in accordance with the guarantee principles set out in this Schedule I (the “Agreed Security Principles”).
2.GENERAL PRINCIPLES
2.1The Agreed Security Principles embody a recognition by all parties that there may be certain legal and practical difficulties in obtaining effective guarantees from the Parent Guarantor and its Subsidiaries (collectively, the “Group”) in certain jurisdictions. In particular:
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(a) general statutory limitations, capital maintenance, the prohibition of an intervention threatening the existence of a German member of the Group (Verstoß gegen das Verbot des existenzvernichtenden Eingriffs), financial assistance, corporate benefit, fraudulent preference, “thin capitalization” rules, retention of title claims, regulatory restrictions and similar principles may limit the ability of a member of the Group to provide a guarantee or may require that the guarantee be limited by an amount or otherwise. If any such limit applies, the guarantees provided will be limited to the maximum amount which the relevant member of the Group may provide having regard to applicable law; |
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(b) unless each consent required by law, statute, the terms of any applicable contract, instrument or constitutional document or otherwise from the minority shareholders in, or any relevant corporate body of, any member of the Group which is not wholly owned (directly or indirectly) by another member of the Group is obtained, such Group member shall not be required to grant guarantees provided that the relevant company and the Parent Guarantor have used reasonable efforts to obtain such consent; |
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(c) guarantees should not be granted to the extent that it would result in a risk to the directors or officers of the relevant grantor of such guarantee of contravention of any statutory duty in such capacity or their fiduciary duties and/or which could reasonably be expected to result in personal, civil or criminal liability on the part of any such director or officer; |
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(d) the maximum guaranteed amount may be limited to minimize stamp duty, notarization, registration or other applicable fees, taxes and duties where the benefit of increasing the guaranteed amount is disproportionate to the level of such fee, taxes and duties; and |
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(e) the giving of a guarantee will not be required if: |
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(i) it would have a material adverse effect on the ability of the relevant member of the Group to conduct its operations and business in the ordinary course as otherwise permitted by the Indenture; or |
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(ii) it would have a material adverse effect on the tax arrangements of the Group or any member of the Group, |
provided that, in each case, the relevant member of the Group shall use reasonable efforts to overcome such obstacle. The guaranteed obligations will be limited where necessary to prevent any material additional tax liability of any member of the Group.
3.guarantees
3.1Where a member of the Group requires prior consideration of or consultation with any corporate body and/or anybody representing employees of such a member of the Group before granting guarantees, such guarantees shall not be granted until any procedure that must be followed under applicable law in respect of that consideration or consultation has been completed.
3.2In the case of guarantees to be granted by a Guarantor incorporated in The Netherlands or France or any other jurisdictions requiring receipt of advice from a works council such guarantees shall not be granted until neutral or positive advice is received from any relevant works council.
3.3Each guarantee will be an upstream, cross-stream and downstream guarantee and each guarantee will be for all liabilities of the relevant members of the Group under the Indenture in accordance with, and subject to, the requirements of the Agreed Security Principles in each relevant jurisdiction.
3.4No subsidiary of the Parent Guarantor that is a Controlled Foreign Corporation (as defined in the United States Internal Revenue Code of 1986, as amended) (or that is a disregarded entity for U.S. federal income tax purposes owned by any such Controlled Foreign Corporation) shall be required to give a guarantee. These principles also apply with respect to any entity that becomes a United States Person and/or a Controlled Foreign Corporation following any guarantee.
3.5No Subsidiary of the Parent Guarantor shall guarantee the Notes unless such Subsidiary provides a Guarantee.
4.Jurisdictions
4.1The guarantees to be provided under and in connection with the Notes and the Indenture will only be granted by members of the Group organized under the laws of the following jurisdictions:
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(i) Australia; |
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(i) Austria; |
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(i) Czech Republic; |
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(i) Denmark; |
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(i) France; |
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(i) Germany; |
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(i) Guernsey; |
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(i) Ireland; |
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(i) Italy; |
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(i) Luxembourg |
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(i) New Zealand; |
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(i) Norway; |
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(i) Poland; |
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(i) Sweden; |
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(i) Switzerland; |
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(i) The Netherlands; |
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(i) The United Kingdom; and |
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(i) The United States of America. |
EXHIBIT A
[FORM OF FACE OF NOTE]
ARDAGH PACKAGING FINANCE PLC
ARDAGH HOLDINGS USA INC.
If Regulation S Global Note – Common Code Number [●]/ISIN [●]
If Restricted Global Note – Common Code Number [●]/ISIN [●]
No. [●]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF CITIVIC NOMINEES LIMITED AS NOMINEE FOR CITIBANK EUROPE PLC (THE “COMMON DEPOSITARY”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CITIBANK EUROPE PLC, AS COMMON DEPOSITARY OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY (AND ANY PAYMENT IS MADE TO CITIVIC NOMINEES LIMITED OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CITIVIC NOMINEES LIMITED, HAS AN INTEREST HEREIN.
TRANSFERS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF THE COMMON DEPOSITARY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS CERTIFICATE AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF THIS CERTIFICATE TO REFLECT ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS CERTIFICATE SHALL BE DEEMED, BY THE ACCEPTANCE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON-U.S. PERSON ACQUIRING THIS NOTE IN AN ‘‘OFFSHORE TRANSACTION’’ PURSUANT TO RULE 144A OR RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED NOTES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE ‘‘RESALE RESTRICTION TERMINATION DATE’’) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUERS OR ANY AFFILIATE OF THE ISSUERS WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE NOTES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO THE ISSUERS OR THE PARENT GUARANTOR, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO THE ISSUERS’ AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN £100,000.
BY ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST THEREIN), THE PURCHASER OR HOLDER WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT (A) IT IS NOT AND FOR SO LONG AS IT HOLDS THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT BE (I) AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), THAT
IS SUBJECT TO TITLE I OF ERISA, (II) A “PLAN” AS DEFINED IN AND SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) AN ENTITY OR ACCOUNT WHOSE UNDERLYING ASSETS ARE DEEMED TO INCLUDE THE ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR OTHER PLAN SUBJECT TO SECTION 4975 OF THE CODE OR (IV) A NON U.S., GOVERNMENTAL, CHURCH OR OTHER BENEFIT PLAN WHICH IS SUBJECT TO ANY NON U.S. OR U.S. FEDERAL, STATE, OR LOCAL LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF TITLE I OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) (EACH OF (I), (II), (III) AND (IV), A “PLAN”), (B) NO ASSETS OF A PLAN HAVE BEEN USED TO ACQUIRE THIS NOTE (OR ANY INTEREST HEREIN) OR (C) ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST THEREIN) WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH AN EXEMPTION IS NOT AVAILABLE OR VIOLATION OF ANY SIMILAR LAW.
[IN THE CASE OF ADDITIONAL REGULATION S NOTES: THIS NOTE SHALL BEAR THE TEMPORARY COMMON CODES AND TEMPORARY ISIN NUMBERS INDICATED ON THIS NOTE UNTIL THE DAY THAT IS 40 DAYS AFTER [●], AFTER WHICH DATE THE PERMANENT CUSIP AND PERMANENT ISIN NUMBERS INDICATED ON THIS NOTE SHALL BE BORNE.]
4.750% SENIOR NOTE DUE 2027
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc., a Delaware corporation, for value received, jointly and severally promise to pay to [●] or registered assigns the principal sum of £[●] (as such amount may be increased or decreased as indicated on Schedule A (Schedule of Principal Amount) of this Note) on July 15, 2027.
From [●] or from the most recent interest payment date to which interest has been paid or provided for, cash interest on this Note will accrue at 4.750%, payable semi-annually on January 15 and July 15 of each year, beginning on [●], to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the preceding January 1 or July 1, as the case may be.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. have caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARDAGH PACKAGING FINANCE PLC
By:
Name:
Title: Authorized Signatory
ARDAGH HOLDINGS USA INC.
By:
Name:
Title: Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
4.750% Senior Note Due 2027
1.Interest
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc. a Delaware corporation (each corporation, and such respective successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuers”), for value received, promises to pay interest on the principal amount of this Note from [●], at the rate of 4.750% per annum. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a)All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes, after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b)None of the Issuers or Guarantors will, however, pay Additional Amounts in respect or on account of:
(i)any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee);
(ii)any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing
Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii)any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv)any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note or any Guarantee;
(v)any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi)any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii)any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii)any withholding or deduction in respect of any Taxes where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to the European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meetings of November 26 and 27, 2000 on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, any such Directive;
(ix)any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(x)any combination of the foregoing.
(c)The Issuers and the Guarantors, if the applicable withholding agent, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d)At least 30 calendar days prior to each date on which any payment under or with respect to this Note or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee,
with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 of the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts.
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or such Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or such Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuers and the Guarantors (and not otherwise in the possession of the Trustee) to enable the determination of the amount of any withholding taxes attributable to any particular Holder(s).
(e)Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this or any other Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable.
(f)The preceding provisions will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent)makes any payment on this or any other Note (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuers shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next Interest Payment Date even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuers shall pay principal and interest in pounds sterling in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuers by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted
Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent and Citigroup Global Markets Deutschland AG will act as Registrar. The Issuers or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuers issued this Note under an indenture dated as of June 12, 2017 (the “Indenture”), among, inter alios, the Issuers, Ardagh Group S.A., as parent guarantor (the “Parent Guarantor”), and Citibank, N.A., London Branch, as trustee (the “Trustee”). The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuers, the Guarantors and their Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting the Parent Guarantor and its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Parent Guarantor and the Restricted Subsidiaries, Change of Control and Liens.
6.Optional Redemption
(a)In the event that, prior to July 15, 2020, the Issuers receive proceeds from one or more Public Equity Offerings, the Issuers may, at their election, use all or a portion of such proceeds, on one or more occasions, to redeem up to a maximum of 40% of the aggregate principal amount of the Notes, including Additional Notes, if any, at a Redemption Price equal to 104.750% of the principal amount thereof, plus accrued and unpaid interest thereon, if any, to (but excluding) the Redemption Date (subject to the right of Holders of record on a relevant Record Date prior to the Redemption Date to receive interest due on the relevant Interest Payment Date); provided that after giving effect to any such redemption, at least 60% of the aggregate principal amount at maturity of the Notes initially issued would remain outstanding immediately after such redemption. Any such redemption shall be made within 120 days of the closing of a Public Equity Offering upon not less than 10 nor more than 60 days’ notice mailed to each Holder being redeemed and otherwise in accordance with the procedures set forth in the Indenture.
(b)At any time prior to July 15, 2022, the Issuers may redeem all or part of the Notes, upon not less than 10 nor more than 60 days’ prior notice, at a Redemption Price equal to 100% of the principal amount hereof, plus the Applicable Redemption Premium and accrued and unpaid interest to (but excluding) the Redemption Date (subject to the right of Holders of record on a relevant Record Date prior to the Redemption Date to receive interest due on the relevant Interest Payment Date).
“Applicable Redemption Premium” means, with respect to any Note on any Redemption Date, the greater of (i) 1.0% of the principal amount of such Note; and (ii) the excess of (A) the present value at such Redemption Date of (1) the Redemption Price of such Note at July 15, 2022 (such Redemption Price being set forth in the table appearing below in clause (c)), plus (2) all required interest payments due on such Note during the period between the Redemption Date and July 15, 2022 (excluding accrued but unpaid interest),
computed using a discount rate equal to the Gilt Rate at such Redemption Date plus 50 basis points, over (B) the outstanding principal amount of the Note.
“Gilt Rate” means, with respect to any redemption date, the yield to maturity as of such redemption date of U.K. Government Securities with a fixed maturity (as compiled by the Office for National Statistics and published in the most recent Financial Statistics that have become publicly available at least two Business Days in London prior to such redemption date (or, if such Financial Statistics are no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to July 15, 2022; provided, however, that if the period from such redemption date to July 15, 2022 is less than one year, the weekly average yield on actually traded U.K. Government Securities denominated in sterling adjusted to a fixed maturity of one year shall be used.
(c)At any time on or after July 15, 2022 and prior to maturity, the Issuers may redeem all or part of the Notes, upon not less than 10 days’ nor more than 60 days’ notice, in amounts of £100,000 or integral multiples of £1,000 in excess thereof at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to (but excluding) the Redemption Date, if redeemed during the 12-month period beginning July 15 of the years set forth below (subject to the right of Holders of record on a relevant Record Date prior to the Redemption Date to receive interest due on the relevant Interest Payment Date):
Year |
Redemption Price |
|
|
2022 |
102.3750% |
2023 |
101.1875% |
2024 |
100.5938% |
2025 and thereafter |
100.000% |
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent.
7.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuers, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to (but excluding) the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing clauses (a) and (b), a “Change in
Tax Law”), the Issuers would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in paragraph 2 of this Note), with respect to the Relevant Taxing Jurisdiction, which the Issuers cannot avoid by the use of reasonable measures available to the Issuers. Prior to the giving of any notice of redemption pursuant to this paragraph 7, the Issuers shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuers taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuers of recognized standing qualified under the laws of the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuers has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on Holders of the Notes.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuers would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent.
8.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than £100,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of £1,000 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
9.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuers or the Parent Guarantor shall offer to purchase on the Change of Control Purchase Date all or any part (equal to £100,000 or an integral multiple of £1,000 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuers and the Parent Guarantor shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to paragraph 6 or paragraph 7 of this Note. The Issuers shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders of the Notes must follow to accept the Change of Control Offer.
When the aggregate amount of Excess Proceeds exceeds €50,000,000, the Parent Guarantor or the Issuers shall, within 20 Business Days, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in the Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as a multiple of £1,000) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase.
To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the Parent Guarantor may use the amount of such Excess Proceeds not used to purchase Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero.
10.Denominations
The Notes (including this Note) are in denominations of £100,000 and integral multiples of £1,000 in excess thereof of principal amount at maturity. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
11.Unclaimed Money
All moneys paid by the Issuers or the Guarantors to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such principal, premium or interest has become due and payable may be repaid to the Issuers or the Guarantors, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuers or the Guarantors for payment thereof.
12.Discharge and Defeasance
Subject to certain conditions, the Issuers at any time may terminate some or all of its obligations and the obligations of the Guarantors under this Note and each other Note, the Guarantees and the Indenture if the Issuers irrevocably deposit with the Trustee pounds sterling or U.K. Government Securities for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
13.Amendments and Waivers
(a)(i) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), the Guarantors and the Trustee may modify, amend or supplement the Indenture, any Guarantee or this Note and each other Note without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants in the Indenture and in this Note; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with the provisions of Article Five of the Indenture; provided, further, that such transaction need not be of a specific type identified in such covenant (it being understood that in the case of any other transaction, the requirements of such covenant shall apply mutatis mutandis);
(B)to add to the covenants of the Issuers, any Guarantor or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon this Note and each other Note, as applicable, in the Indenture, in this Note and each other Note or in any Guarantees;
(C)to cure any ambiguity, or to correct or supplement any provision in the Indenture, this Note and each other Note or any Guarantees that may be defective or inconsistent with any other provision in the Indenture, this Note and each other Note or any Guarantee or make any other provisions with respect to matters or questions arising under the Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Guarantees or the Notes to any provision of the “Description of the Notes” section of the Offering Memorandum to the extent that such provision in the “Description of the Notes” was intended to be a verbatim recitation of a provision of the Indenture, the Guarantees or the Notes;
(E)to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in the Indenture and to add a Subsidiary Guarantor or other guarantor under the Indenture (which will require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s));
(F)to evidence and provide the acceptance of the appointment of a successor Trustee under the Indenture;
(G)to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to the Indenture or otherwise; or
(H)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under the Indenture may supplement the Indenture to add a Subsidiary Guarantor or other guarantor under the Indenture, in each case without notice to or consent of any Holder.
(iii) In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
(b)Except as provided in Section 9.02(b) and Section 6.04 of the Indenture and without prejudice to Section 9.01 of the Indenture, the Issuers, the Guarantors and the Trustee may:
(i)modify, amend or supplement the Indenture, this Note or the other Notes; or
(ii)waive compliance by the Issuers with any provision of the Indenture, this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes); provided that, if any amendment, waiver, or other modification will only affect one series of the Notes, only the consent of the holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required;
(c)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding),, with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 9.01 of the Indenture, may:
(i)change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(ii)reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(iii)change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(iv)impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(v)reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(vi)modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(vii)make any change to the Intercreditor Agreement (or any Additional Intercreditor Agreement) or any provisions of the Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders; or
(viii)make any change in Section 4.12 of the Indenture that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation
to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(d)The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
14.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in sub-clauses (viii) or (ix) of Section 6.01(a) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note and the other Notes except as provided in the Indenture and subject to the Intercreditor Agreement and any Additional Intercreditor Agreement. The Trustee may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations and the Intercreditor Agreement (and any Additional Intercreditor Agreement), the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
15.Ranking
This Note and the other Notes will be general obligations of each Issuer and will rank senior in right of payment to any and all of each Issuer’s existing and future Debt that is subordinated in right of payment to the Notes, rank equally in right of payment with all of each Issuer’s existing and future Debt that is not subordinated in right of payment to the Notes, and be structurally subordinated to all existing and future indebtedness of the Parent Guarantor’s Subsidiaries that do not provide Guarantees.
16.Guarantees
The Subsidiary Guarantees will be subordinated in right of payment to Senior Debt and will be subject to certain limitations on enforcement in favor of holders of Senior Debt, all as provided in the Indenture.
17.Trustee Dealings with the Issuers
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers, the Guarantors or any of their Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
18.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuers or any Guarantor shall not have any liability for any obligations of the Issuers or any Guarantor under this Note, the other Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
19.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
20.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
21.ISIN and Common Code Numbers
The Issuers may cause ISIN and Common Code numbers to be printed on the Notes, and if so the Trustee shall use ISIN and Common Code numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
22.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuers) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuers or any of their respective Affiliates, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Parent Guarantor or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have
certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuers reasonably request to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or Section 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of £100,000 or any integral multiple of £1,000 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
Date of
Increase |
Decrease in
|
Increase in
|
Principal Amount
Increase |
Notation Made by or on Behalf of Registrar |
_____________ |
_____________ |
_____________ |
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_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
_____________ |
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_____________ |
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EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM RESTRICTED
GLOBAL NOTE TO REGULATION S GLOBAL NOTE.*
(Transfers pursuant to Section 2.06(b)(ii) of the Indenture)
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: 4.750% Senior Notes due 2027 (the “Notes”)
Reference is hereby made to the Indenture dated as of June 12, 2017 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to £____________ aggregate principal amount of Notes that are held as a beneficial interest in the form of the Restricted Global Note ([Common Code No. [●]]; [ISIN No: [●]) with Common Depositary in the name of [name of transferor](the “Transferor”). The Transferor has requested an exchange or transfer of such beneficial interest for an equivalent beneficial interest in the Regulation S Global Note ([Common Code No. [●]]; ISIN No: [●]).
In connection with such request, the Transferor does hereby certify that such transfer has been effected in accordance with the transfer restrictions set forth in the Notes and:
(a)with respect to transfers made in reliance on Regulation S (“Regulation S”) under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), does certify that:
(i)the offer of the Notes was not made to a person in the United States;
(ii)either (i) at the time the buy order is originated the transferee is outside the United States or the Transferor and any person acting on its behalf reasonably believe that the transferee is outside the United States or; (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market described in paragraph (b) of Rule 902 of Regulation S and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States
(iii)no directed selling efforts have been made in the United States by the Transferor, an affiliate thereof or any person their behalf in contravention of the requirements of Rule 903 or 904 of Regulation S, as applicable;
(iv)the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act; and
(v)the Transferor is not an Issuer, a distributor of the Notes, an affiliate of an Issuer or any such distributor (except any officer or director who is an affiliate solely by virtue of holding such position) or a person acting on behalf of any of the foregoing.
(b)with respect to transfers made in reliance on Rule 144 the Transferor certifies that the Notes are being transferred in a transaction permitted by Rule 144 under the U.S. Securities Act.
You, the Issuers, the Guarantors and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
____________________
*If the Note is a Definitive Note, appropriate changes need to be made to the form of this transfer certificate.
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM REGULATION S
GLOBAL NOTE TO RESTRICTED GLOBAL NOTE
(Transfers pursuant to Section 2.06(b)(iii) of the Indenture)
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: 4.750% Senior Notes due 2027 (the “Notes”)
Reference is hereby made to the Indenture dated as of June 12, 2017 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to £__________ aggregate principal amount at maturity of Notes that are held in the form of the Regulation S Global Note ([Common Code No.: [●]]; ISIN No. [●]) with the Common Depositary in the name of [name of transferor] (the “Transferor”) to effect the transfer of the Notes in exchange for an equivalent beneficial interest in the Restricted Global Note ([Common Code No.: [●]]; ISIN No. [●]).
In connection with such request, and in respect of such Notes the Transferor does hereby certify that such Notes are being transferred in accordance with the transfer restrictions set forth in the Notes and that:
CHECK ONE BOX BELOW:
☐the Transferor is relying on Rule 144A under the Securities Act for exemption from such Act’s registration requirements; it is transferring such Notes to a person it reasonably believes is a QIB as defined in Rule 144A that purchases for its own account, or for the account of a qualified institutional buyer, and to whom the Transferor has given notice that the transfer is made in reliance on Rule 144A and the transfer is being made in accordance with any applicable securities laws of any state of the United States; or
☐the Transferor is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act, subject to the Issuers’ and the Trustee’s right prior to any such offer, sale or transfer to require the delivery of an Opinion of Counsel, certification and/or other information satisfactory to each of them.
You, the Issuers, the Guarantors, and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
Exhibit 99.5
ARDAGH PACKAGING FINANCE PLC
and
ARDAGH HOLDINGS USA INC.
as Issuers,
ARDAGH Group S.A.,
as Parent Guarantor,
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Principal Paying Agent, Transfer Agent and Security Agent,
and
CITIGROUP GLOBAL MARKETS Europe AG,
as Registrar
_____________________________
Indenture
Dated as of August 12, 2019
_____________________________
4.125% SENIOR SECURED NOTES DUE 2026
2.125% SENIOR SECURED NOTES DUE 2026
TABLE OF CONTENTS
ARTICLE One
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.Definitions...............................................................................................................................1
SECTION 1.02.Other Definitions...................................................................................................................31
SECTION 1.03.Rules of Construction.............................................................................................................33
SECTION 1.04.Financial Calculations.............................................................................................................33
SECTION 1.05.Agency of Irish Issuer.............................................................................................................34
ARTICLE Two
THE NOTES
SECTION 2.01.The Notes.............................................................................................................................34
SECTION 2.02.Execution and Authentication.................................................................................................36
SECTION 2.03.Registrar, Transfer Agent and Paying Agent.............................................................................37
SECTION 2.04.Paying Agent to Hold Money.................................................................................................37
SECTION 2.05.Holder Lists...........................................................................................................................38
SECTION 2.06.Transfer and Exchange...........................................................................................................38
SECTION 2.07.Replacement Notes...............................................................................................................41
SECTION 2.08.Outstanding Notes.................................................................................................................42
SECTION 2.09.Notes Held by Issuers...........................................................................................................42
SECTION 2.10.Certificated Notes.................................................................................................................42
SECTION 2.11.Cancellation.........................................................................................................................43
SECTION 2.12.Defaulted Interest.................................................................................................................43
SECTION 2.13.Computation of Interest.........................................................................................................44
SECTION 2.14.ISIN, CUSIP and Common Code Numbers.................................................................................44
SECTION 2.15.Issuance of Additional Notes.................................................................................................44
ARTICLE Three
REDEMPTION; OFFERS TO PURCHASE
SECTION 3.01.Right of Redemption.............................................................................................................44
SECTION 3.02.Notices to Trustee.................................................................................................................44
SECTION 3.03.Selection of Notes to Be Redeemed.......................................................................................44
SECTION 3.04.Notice of Redemption...........................................................................................................45
SECTION 3.05.Deposit of Redemption Price.................................................................................................46
SECTION 3.06.[Reserved]...........................................................................................................................46
SECTION 3.07.Payment of Notes Called for Redemption...............................................................................46
SECTION 3.08.Notes Redeemed in Part.......................................................................................................46
ARTICLE Four
COVENANTS
SECTION 4.01.Payment of Notes.................................................................................................................47
SECTION 4.02.Corporate Existence...............................................................................................................47
SECTION 4.03.Maintenance of Properties.....................................................................................................47
SECTION 4.04.Insurance.............................................................................................................................48
SECTION 4.05.Statement as to Compliance...................................................................................................48
SECTION 4.06.Limitation on Debt.................................................................................................................48
SECTION 4.07.Limitation on Liens.................................................................................................................52
SECTION 4.08.Limitation on Restricted Payments.........................................................................................53
SECTION 4.09.Limitation on Sale of Certain Assets.......................................................................................57
SECTION 4.10.Limitation on Transactions with Affiliates.................................................................................59
SECTION 4.11.Purchase of Notes upon a Change of Control...........................................................................61
SECTION 4.12.Additional Amounts...............................................................................................................63
SECTION 4.13.Additional Intercreditor Agreements......................................................................................65
SECTION 4.14.Additional Subsidiary Guarantees and Security Interests.........................................................66
SECTION 4.15.Limitation on Guarantees of Debt by Restricted Subsidiaries.....................................................67
SECTION 4.16.Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries.........68
SECTION 4.17.Designation of Unrestricted and Restricted Subsidiaries...........................................................70
SECTION 4.18.Payment of Taxes and Other Claims.......................................................................................71
SECTION 4.19.Reports to Holders.................................................................................................................71
SECTION 4.20.Further Instruments and Acts.................................................................................................72
SECTION 4.21.Security Confirmations...........................................................................................................72
SECTION 4.22.Suspension of Covenants.......................................................................................................72
ARTICLE Five
CONSOLIDATION, MERGER AND SALE OF ASSETS
SECTION 5.01.Consolidation, Merger and Sale of Assets...............................................................................73
SECTION 5.02.Successor Substituted...........................................................................................................74
ARTICLE Six
DEFAULTS AND REMEDIES
SECTION 6.01.Events of Default...................................................................................................................75
SECTION 6.02.Acceleration.........................................................................................................................77
SECTION 6.03.Other Remedies...................................................................................................................78
SECTION 6.04.Waiver of Past Defaults.........................................................................................................78
SECTION 6.05.Control by Majority...............................................................................................................78
SECTION 6.06.Limitation on Suits.................................................................................................................79
SECTION 6.07.Unconditional Right of Holders to Bring Suit for Payment.........................................................79
SECTION 6.08.Collection Suit by Trustee.......................................................................................................79
SECTION 6.09.Trustee May File Proofs of Claim.............................................................................................80
SECTION 6.10.Application of Money Collected.............................................................................................80
SECTION 6.11.Undertaking for Costs...........................................................................................................81
SECTION 6.12.Restoration of Rights and Remedies.......................................................................................81
SECTION 6.13.Rights and Remedies Cumulative...........................................................................................81
SECTION 6.14.Delay or Omission Not Waiver...............................................................................................81
SECTION 6.15.Record Date.........................................................................................................................81
SECTION 6.16.Waiver of Stay or Extension Laws...........................................................................................81
ARTICLE Seven
TRUSTEE AND SECURITY AGENT
SECTION 7.01.Duties of Trustee and the Security Agent.................................................................................82
SECTION 7.02.Certain Rights of Trustee and the Security Agent.....................................................................83
SECTION 7.03.Individual Rights of Trustee and the Security Agent.................................................................86
SECTION 7.04.Disclaimer of Trustee and Security Agent.................................................................................87
SECTION 7.05.Compensation and Indemnity.................................................................................................87
SECTION 7.06.Replacement of Trustee or Security Agent...............................................................................88
SECTION 7.07.Successor Trustee or Security Agent by Merger.......................................................................89
SECTION 7.08.Appointment of Security Agent and Supplemental Security Agents...........................................90
SECTION 7.09.Eligibility; Disqualification.....................................................................................................91
SECTION 7.10.Appointment of Co-Trustee...................................................................................................91
SECTION 7.11.Resignation of Agents...........................................................................................................92
SECTION 7.12.Agents General Provisions.....................................................................................................93
ARTICLE Eight
DEFEASANCE; SATISFACTION AND DISCHARGE
SECTION 8.01.Issuers’ Option to Effect Defeasance or Covenant Defeasance...................................................94
SECTION 8.02.Defeasance and Discharge.....................................................................................................94
SECTION 8.03.Covenant Defeasance...........................................................................................................94
SECTION 8.04.Conditions to Defeasance.......................................................................................................95
SECTION 8.05.Satisfaction and Discharge of Indenture...................................................................................96
SECTION 8.06.Survival of Certain Obligations...............................................................................................97
SECTION 8.07.Acknowledgment of Discharge by Trustee...............................................................................97
SECTION 8.08.Application of Trust Money.....................................................................................................97
SECTION 8.09.Repayment to Issuers...........................................................................................................98
SECTION 8.10.Indemnity for Government Securities.....................................................................................98
SECTION 8.11.Reinstatement.....................................................................................................................98
ARTICLE Nine
AMENDMENTS AND WAIVERS
SECTION 9.01.Without Consent of Holders...................................................................................................98
SECTION 9.02.With Consent of Holders.....................................................................................................100
SECTION 9.03.Effect of Supplemental Indentures.....................................................................................101
SECTION 9.04.Notation on or Exchange of Notes.......................................................................................101
SECTION 9.05.[Reserved].........................................................................................................................101
SECTION 9.06.Notice of Amendment or Waiver.........................................................................................101
SECTION 9.07.Trustee to Sign Amendments, Etc........................................................................................101
SECTION 9.08.Additional Voting Terms; Calculation of Principal Amount.....................................................102
ARTICLE Ten
GUARANTEE
SECTION 10.01.Notes Guarantees...............................................................................................................102
SECTION 10.02.Subrogation.......................................................................................................................103
SECTION 10.03.Release of Subsidiary Guarantees.......................................................................................103
SECTION 10.04.Limitation and Effectiveness of Guarantees.........................................................................104
SECTION 10.05.Notation Not Required.......................................................................................................104
SECTION 10.06.Successors and Assigns.......................................................................................................104
SECTION 10.07.No Waiver.........................................................................................................................104
SECTION 10.08.Modification.......................................................................................................................104
SECTION 10.09.Trustee and Security Agent to Effectuate Subordination of Heye International GmbH Subsidiary Guarantee105
ARTICLE Eleven
SECURITY
SECTION 11.01.Security; Security Documents.............................................................................................105
SECTION 11.02.Authorization of Actions to Be Taken by the Security Agent Under the Security Documents.....106
SECTION 11.03.Authorization of Receipt of Funds by the Security Agent Under the Security Documents.........107
SECTION 11.04.Release of the Collateral.....................................................................................................107
SECTION 11.05.Parallel Debt.....................................................................................................................108
ARTICLE Twelve
MISCELLANEOUS
SECTION 12.01.Release of U.S. Issuer’s Obligations.....................................................................................109
SECTION 12.02.Notices.................................................................................................................................110
SECTION 12.03.Certificate and Opinion as to Conditions Precedent...............................................................112
SECTION 12.04.Statements Required in Certificate or Opinion.....................................................................112
SECTION 12.05.Rules by Trustee, Paying Agent and Registrar.......................................................................112
SECTION 12.06.Legal Holidays...................................................................................................................112
SECTION 12.07.Governing Law...................................................................................................................113
SECTION 12.08.Jurisdiction.......................................................................................................................113
SECTION 12.09.No Recourse Against Others...............................................................................................113
SECTION 12.10.Successors.........................................................................................................................113
SECTION 12.11.Multiple Originals...............................................................................................................114
SECTION 12.12.Table of Contents, Cross-Reference Sheet and Headings.......................................................114
SECTION 12.13.Severability.......................................................................................................................114
SECTION 12.14.Currency Indemnity...........................................................................................................114
SECTION 12.15.Contractual Recognition of Bail-In.......................................................................................114
Schedules
Schedule I-Agreed Security Principles
Exhibits
Exhibit A-1-Form of Dollar Notes
Exhibit A-2-Form of Euro Notes
Exhibit B-Form of Transfer Certificate for Transfer from Restricted Global Note to Regulation S Global Note
Exhibit C-Form of Transfer Certificate for Transfer from Regulation S Global Note to Restricted Global Note
INDENTURE dated as of August 12, 2019 among Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland (the “Irish Issuer”), Ardagh Holdings USA Inc., a Delaware corporation (the “U.S. Issuer” and, together with the Irish Issuer, the “Issuers”), Ardagh Group S.A. (the “Parent Guarantor”), Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as Transfer Agent, Citibank, N.A., London Branch, as security agent (the “Security Agent”), and Citigroup Global Markets Europe AG, as Registrar.
RECITALS OF THE ISSUERS AND THE PARENT GUARANTOR
The Issuers have duly authorized the execution and delivery of this Indenture to provide for the issuance of (i) their euro denominated 2.125% Senior Secured Notes due 2026 issued on the date hereof (the “Original Euro Notes”) and any additional euro denominated notes (“Additional Euro Notes” and, together with the Original Euro Notes, the “Euro Notes”) that may be issued after the Issue Date (as defined herein) and (ii) their dollar denominated 4.125% Senior Secured Notes due 2026 (the “Original Dollar Notes” and, together with the Original Euro Notes, the “Original Notes”) and any additional dollar denominated notes (“Additional Dollar Notes” and, together with the Original Dollar Notes, the “Dollar Notes”; Additional Dollar Notes and Additional Euro Notes together, the “Additional Notes”) that may be issued after the Issue Date. The Original Notes and Additional Notes together are the “Notes”. The Issuers and the Parent Guarantor have received good and valuable consideration for the execution and delivery of this Indenture. The Parent Guarantor will derive substantial direct and indirect benefits from the issuance of the Notes. All necessary acts and things have been done to make (i) the Notes, when duly issued and executed by the Issuers and authenticated and delivered hereunder, the legal, valid and binding obligations of the Issuers and (ii) this Indenture (including the Guarantees included herein) a legal, valid and binding agreement of the Issuers and the Parent Guarantor in accordance with the terms of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:
“Acquired Debt” means Debt of a Person:
(a)existing at the time such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Parent Guarantor or any Restricted Subsidiary; or
(b)assumed in connection with the acquisition of assets from any such Person;
provided, in each case, that such Debt was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary or such acquisition, as the case may be.
Acquired Debt will be deemed to be incurred on the date the acquired Person becomes a Restricted Subsidiary or the date of the related acquisition of assets from any such Person.
“Affiliate” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Agreed Security Principles” means the Agreed Security Principles as set forth on Schedule I hereto.
“Applicable Law” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Asset Sale” means any sale, issuance, conveyance, transfer, lease or other disposition (including, without limitation, by way of merger, consolidation or sale and leaseback transaction) (collectively, a “transfer”), directly or indirectly, in one or a series of related transactions, of:
(a)any Capital Stock of any Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Parent Guarantor or a Restricted Subsidiary);
(b)all or substantially all of the properties and assets of any division or line of business of the Parent Guarantor or any Restricted Subsidiary; or
(c)any other of the Parent Guarantor’s or any Restricted Subsidiary’s properties or assets.
Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(i)any transfer or disposition of assets that is governed by the provisions of Article Five and Section 4.11 or any transfer or disposition of assets consummated in connection with a Permitted Reorganization;
(ii)any transfer or disposition of assets by the Parent Guarantor to the Issuers or any Restricted Subsidiary, or by any Restricted Subsidiary to the Parent Guarantor, the Issuers or any Restricted Subsidiary in accordance with the terms of this Indenture;
(iii)any transfer or disposition of obsolete or permanently retired equipment or facilities that are no longer useful in the conduct of the Parent Guarantor’s and any Restricted Subsidiary’s business and that are disposed of in the ordinary course of business;
(iv)any disposition of accounts receivable and related assets in a Permitted Receivables Financing;
(v)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(vi)the foreclosure, condemnation or any similar action with respect to any property or other assets;
(vii)any unwinding or termination of hedging obligations not for speculative purposes;
(viii)any single transaction or series of related transactions that involves assets or Capital Stock having a Fair Market Value of less than the greater of $50,000,000 and 0.75% of Total Assets;
(ix)for the purposes of Section 4.09 only, the making of a Permitted Investment or a disposition permitted under Section 4.08; or, solely for the purposes Section 4.09(b), asset sales, the proceeds of which are used within 540 days of receipt of such proceeds to make such Restricted Payments, Permitted Payments or Permitted Investments;
(x)the sale, lease or other disposition of equipment, inventory, property or other assets in the ordinary course of business;
(xi)the lease, assignment or sublease of any real or personal property in the ordinary course of business;
(xii)an issuance of Capital Stock by a Restricted Subsidiary to the Parent Guarantor or to another Restricted Subsidiary;
(xiii)a Permitted Investment or a Restricted Payment (or a transaction that would constitute a Restricted Payment but for the exclusions from the definition thereof) that is not prohibited by Section 4.08;
(xiv)any disposition of Capital Stock, Debt or other securities of any Unrestricted Subsidiary or a Permitted Joint Venture;
(xv)sales of assets received by the Parent Guarantor or any Restricted Subsidiary upon the foreclosure on a Lien granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(xvi)sales or grants of licenses to use the patents, trade secrets, know-how and other intellectual property of the Parent Guarantor or any of its Restricted Subsidiaries to the extent that such license does not prohibit the Parent Guarantor or any of its Restricted Subsidiaries from using the technologies licensed (other than pursuant to exclusivity or non-competition arrangements negotiated on an arm’s‑length basis) or require the Parent Guarantor or any of its Restricted Subsidiaries to pay any fees for any such use;
(xvii)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business; or
(xviii)sales, issuances, conveyances, transfers, leases or other dispositions to the extent constituting Permitted Liens.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Average Life” means, as of the date of determination with respect to any Debt, the quotient obtained by dividing:
(a)the sum of the products of:
(i)the numbers of years from the date of determination to the date or dates of each successive scheduled principal payment of such Debt; multiplied by
(ii)the amount of each such principal payment;
by
(b)the sum of all such principal payments.
“Bankruptcy Law” means any law relating to bankruptcy, insolvency, receivership, moratorium, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law, including, without limitation, (i) bankruptcy law of Ireland, (ii) bankruptcy law of The Netherlands, (iii) bankruptcy law of England, (iv) bankruptcy law of Germany, (v) bankruptcy law of Sweden, (vi) bankruptcy law of Denmark, (vii) bankruptcy law of Poland, (viii) bankruptcy law of Italy or (ix) bankruptcy law of Luxembourg or (x) Title 11, United States Bankruptcy Code of 1978, as amended.
“Board of Directors” means (i) with respect to any corporation, the board of directors or managers, as applicable, of the corporation, or any duly authorized committee thereof; (ii) with respect to any partnership, the board of directors or other governing body of the general partner, as applicable, of the partnership or any duly authorized committee thereof; (iii) with respect to a limited liability company, the managing member or members or any duly authorized controlling committee thereof; and (iv) with respect to any other Person, the board or any duly authorized committee of such Person serving a similar function. Whenever any provision of this Indenture requires any action or determination to be made by, or any approval of, a Board of Directors (including for the avoidance of doubt any committee thereof), such action, determination or approval shall be deemed to have been taken or made if approved by a majority of the directors (excluding employee representatives, if any) on any such Board of Directors (whether or not such action or approval is taken as part of a formal board meeting or as a formal board approval), including for the avoidance of doubt any committee thereof. Unless the context requires otherwise, Board of Directors means the Board of Directors of the Parent Guarantor.
“Book-Entry Interest” means a beneficial interest in a Global Note held through and shown on, and transferred only through, records maintained in book-entry form by DTC, Euroclear or Clearstream and their respective nominees and successors, in the case of Euroclear and Clearstream, acting through themselves or the Common Depositary.
“Bund Rate” means, with respect to any Redemption Date, the rate per annum equal to the equivalent yield to maturity as of such Redemption Date of the Comparable German Bund Issue, assuming a price for the Comparable German Bund Issue (expressed as a percentage of its principal amount) equal to the Comparable German Bund Price for such Redemption Date, where:
(a)“Comparable German Bund Issue” means the German Bundesanleihe security selected by any Reference German Bund Dealer as having a fixed maturity most nearly equal to the period from such Redemption Date to August 15, 2022, and that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of euro denominated corporate debt securities in a principal amount approximately equal to the then outstanding principal amount of the Euro Notes and of a maturity most nearly equal to August 15, 2022; provided that if the period from such Redemption Date to August 15, 2022 is less than one year, a fixed maturity of one year shall be used;
(b)“Comparable German Bund Price” means, with respect to any Redemption Date, the average of the Reference German Bund Dealer Quotations for such Redemption Date, after
excluding the highest and lowest such Reference German Bund Dealer Quotations, or if an Issuer obtains fewer than four such Reference German Bund Dealer Quotations, the average of all such quotations;
(c)“Reference German Bund Dealer” means any dealer of German Bundesanleihe securities appointed by an Issuer (and notified to the Trustee); and
(d)“Reference German Bund Dealer Quotations” means, with respect to each Reference German Bund Dealer and any Redemption Date, the average as determined by an Issuer of the bid and offered prices for the Comparable German Bund Issue (expressed in each case as a percentage of its principal amount) quoted in writing to an Issuer by such Reference German Bund Dealer at 3:30 p.m. Frankfurt, Germany time on the third Business Day preceding such Redemption Date.
“Business Day” means a day of the year on which banks are not required or authorized by law to close in Dublin, New York City or London and, in relation to a transaction involving euro, any TARGET day.
“Capital Stock” means, with respect to any Person, any and all shares, interests, partnership interests (whether general or limited), participations, rights in or other equivalents (however designated) of such Person’s equity, any other interest or participation that confers the right to receive a share of the profits and losses, or distributions of assets of, such Person and any rights (other than debt securities convertible into or exchangeable for Capital Stock), warrants or options exchangeable for or convertible into such Capital Stock, whether now outstanding or issued after the Issue Date.
“Capitalized Lease Obligation” means, with respect to any Person, any obligation of such Person under a lease of (or other agreement conveying the right to use) any property (whether real, personal or mixed), which obligation is required to be classified and accounted for as a capital lease obligation under IFRS, and, for purposes of this Indenture, the amount of such obligation at any date will be the capitalized amount thereof at such date, determined in accordance with IFRS and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Cash Equivalents” means any of the following:
(a)any evidence of Debt with a maturity of 180 days or less from the date of acquisition issued or directly and fully guaranteed or insured by a member state of the European Union or European Economic Area, the United States of America, any state thereof or the District of Columbia, Canada, Switzerland, Australia or any agency or instrumentality thereof (each, an “Approved Jurisdiction”);
(b)time deposit accounts, certificates of deposit, money market deposits or bankers’ acceptances with a maturity of 180 days or less from the date of acquisition issued by a bank or trust company having combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating, at the time any investment is made therein, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s;
(c)commercial paper with a maturity of 180 days or less from the date of acquisition issued by a corporation that is not either Issuer’s or any Restricted Subsidiary’s Affiliate and is at
the time of acquisition, rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s;
(d)repurchase obligations with a term of not more than seven days for underlying securities of the type described in clause (a) or (b) above entered into with a financial institution meeting the qualifications described in clause (b) above;
(e)investments in money market mutual funds at least 95% of the assets of which constitute Cash Equivalents of the kind described in clauses (a) through (d) above; or
(f)any investments classified as cash equivalents under IFRS.
“Change of Control” means the occurrence of any of the following events:
(a)the consummation of any transaction (including a merger or consolidation) the result of which is that (i) any person or group, other than one or more Permitted Holders, is or as a result of such transaction becomes, the beneficial owner, directly or indirectly, of more than 50% (or so long as any of the Existing Ardagh Bonds remain outstanding, 35%) of the total voting power of the Voting Stock of the Parent Guarantor and (ii) the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such other person or group;
(b)the sale, transfer, conveyance or other disposition (other than by way of merger, consolidation or transfer of the Parent Guarantor’s Voting Stock or in connection with a Permitted Reorganization) of all or substantially all of the assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor, the Issuers and the Restricted Subsidiaries, on a consolidated basis, to any person or group other than one or more Permitted Holders;
(c)the Parent Guarantor or either Issuer is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which does not violate the provisions described under Article Five or in connection with a Permitted Reorganization; or
(d)the Parent Guarantor or any Surviving Entity ceases to beneficially own, directly or indirectly, 100% of the Voting Stock of either Issuer, other than director’s qualifying shares and other shares required to be issued by law.
For the purposes of this definition, (i) “person” and “group” have the meanings they have in Sections 13(d) and 14(d) of the Exchange Act; (ii) “beneficial owner” is used as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time; and (iii) a Person or group will be deemed to beneficially own all Voting Stock of an entity held by a parent entity, if such Person or group is or becomes the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of such parent entity and the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such Person or group.
“Clearstream” means Clearstream Banking, société anonyme or any successor thereof.
“Code” means the Internal Revenue Code of 1986, as amended.
“Collateral” means the collateral that secures the obligations of the Issuers and the Guarantors under the Notes and this Indenture pursuant to the Security Documents.
“Commission” means the U.S. Securities and Exchange Commission.
“Commodity Hedging Agreements” means any type of commodity hedging agreement (including emissions hedging) designed to protect against or manage exposure to fluctuations in commodity prices and entered into in good faith for such purposes.
“Common Depositary” means a depositary common to Euroclear and Clearstream, being initially Citibank Europe plc, until a successor Common Depositary, if any, shall have become such pursuant to this Indenture, and thereafter Common Depositary shall mean or include each Person who is then a Common Depositary hereunder.
“Consolidated Adjusted Net Income” means, for any period, the Parent Guarantor’s and the Restricted Subsidiaries’ consolidated net income (or loss) for such period as determined in accordance with IFRS, adjusted by excluding (to the extent included in such consolidated net income or loss), without duplication:
(a)any net after-tax extraordinary gains or losses;
(b)any net after-tax gains or losses attributable to sales of assets of the Parent Guarantor or any Restricted Subsidiary that are not sold in the ordinary course of business;
(c)the portion of net income or loss of any Person (other than the Parent Guarantor or a Restricted Subsidiary), including Unrestricted Subsidiaries, in which the Parent Guarantor or any Restricted Subsidiary has an equity ownership interest, except that the Parent Guarantor’s or a Restricted Subsidiary’s equity in the net income of such Person for such period shall be included in such Consolidated Adjusted Net Income to the extent of the aggregate amount of dividends or other distributions actually paid to the Parent Guarantor or any Restricted Subsidiary in cash dividends or other distributions during such period;
(d)the net income or loss of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary is not at the date of determination permitted, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary or its shareholders (other than restrictions contained in the Credit Facilities and related agreements permitted by Section 4.06(b)(ii));
(e)any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves or provisions therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering or refinancing of debt or equity securities;
(f)the non-cash accounting effects of any acquisition, purchase, merger, reorganization or other similar transaction, including any increase in amortization or depreciation resulting from adjustments to tangible or intangible assets, the consequence of any revaluation of inventory or other non-cash charges or effects (including losses on derivatives);
(g)the cumulative effect of a change in accounting principles after the Issue Date;
(h)any charge or expense recorded for non-cash or capitalized interest on Deeply Subordinated Funding;
(i)net after tax gains or losses attributable to (i) the termination of pension plans, (ii) the acquisition of securities or the extinguishment of debt or (iii) currency exchange transactions that are not in the ordinary course of business;
(j)net income or loss attributable to discontinued operations; and
(k)any restoration to net income of any contingency reserve, except to the extent it was provided for in a prior period.
“Consolidated Fixed Charge Coverage Ratio” of the Parent Guarantor means, for any period, the ratio of:
(a)the sum of Consolidated Adjusted Net Income, plus in each case to the extent deducted in computing Consolidated Adjusted Net Income for such period:
(i)Consolidated Net Interest Expense;
(ii)Consolidated Tax Expense; and
(iii)Consolidated Non-cash Charges, less all non-cash items increasing Consolidated Adjusted Net Income for such period and less all cash payments during such period relating to non-cash charges that were added back to Consolidated Adjusted Net Income in determining the Consolidated Fixed Charge Coverage Ratio in any prior period;
(b)to the sum of:
(i)Consolidated Net Interest Expense; and
(ii)cash and non-cash dividends due (whether or not declared) on the Parent Guarantor’s and any Restricted Subsidiary’s Preferred Stock (to any Person other than the Parent Guarantor and any Wholly Owned Restricted Subsidiary), in each case for such period;
provided that in calculating the Consolidated Fixed Charge Coverage Ratio or any element thereof for any period, pro forma effect will be given to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation; provided, further, without limiting the application of the previous proviso, that:
(v)if the Parent Guarantor or any Restricted Subsidiary has incurred any Debt since the beginning of such period that remains outstanding or if the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio is an incurrence of Debt
or both, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Debt as if such Debt had been incurred on the first day of such period and the discharge of any other Debt repaid, repurchased, defeased or otherwise discharged with the proceeds of such new Debt as if such discharge had occurred on the first day of such period;
(w)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary shall have made any Asset Sale, Consolidated Adjusted Net Income for such period shall be reduced by an amount equal to the Consolidated Adjusted Net Income (if positive) directly attributable to the assets which are the subject of such Asset Sale for such period, or increased by an amount equal to the Consolidated Adjusted Net Income (if negative) directly attributable thereto, for such period and the Consolidated Net Interest Expense for such period shall be reduced by an amount equal to the Consolidated Net Interest Expense directly attributable to any Debt of the Parent Guarantor or of any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to the Parent Guarantor and the continuing Restricted Subsidiaries in connection with such Asset Sale for such period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated Net Interest Expense for such period directly attributable to the Debt of such Restricted Subsidiary to the extent the Parent Guarantor and the continuing Restricted Subsidiaries are no longer liable for such Debt after such sale);
(x)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of an asset occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the incurrence of any Debt) as if such Investment or acquisition occurred on the first day of such period;
(y)if, since the beginning of such period, any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Parent Guarantor or any Restricted Subsidiary since the beginning of such period) shall have made any Asset Sale or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (x) or (y) above if made by the Parent Guarantor or a Restricted Subsidiary during such period, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Asset Sale or Investment or acquisition occurred on the first day of such period; and
(z)that the pro forma calculation shall not give effect to: (i) any amounts under clause (b) above attributable to Debt or Preferred Stock incurred on such determination date pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock incurred pursuant to Section 4.06(b)(xix)) or (ii) amounts attributable to any Debt or Preferred Stock discharged on such determination date to the extent that such discharge results from the proceeds incurred pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock discharged on such determination date using proceeds of Debt Preferred Stock incurred pursuant to Section 4.06(b)(xix)).
If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the rate in effect on the date of determination had been the applicable
rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt for a period equal to the remaining term of such Interest Rate Agreement).
“Consolidated Leverage Ratio” of the Parent Guarantor means, as of the date of determination, the ratio of (a) (i) the sum of consolidated Debt of the Parent Guarantor (other than working capital and other than Debt described in clause (f) of the definition of “Debt”) less (ii) cash and Cash Equivalents on the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19 to (b) the aggregate consolidated EBITDA of the Parent Guarantor for the period of the most recent four consecutive quarters for which financial statements are available under Section 4.19, in each case with such pro forma adjustments to consolidated Debt and consolidated EBITDA as are appropriate and consistent with the pro forma provisions set forth in the definition of “Consolidated Fixed Charge Coverage Ratio”.
“Consolidated Net Interest Expense” means, for any period, without duplication and in each case determined on a consolidated basis in accordance with IFRS, the sum of:
(a)the Parent Guarantor’s and the Restricted Subsidiaries’ total interest expense for such period, including, without limitation:
(i)amortization of debt discount;
(ii)the net costs of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements (including amortization of fees and discounts);
(iii)commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and similar transactions; and
(iv)the interest portion of any deferred payment obligation and amortization of debt issuance costs; plus
(b)the interest component of the Parent Guarantor’s and the Restricted Subsidiaries’ Capitalized Lease Obligations accrued and/or scheduled to be paid or accrued during such period other than the interest component of Capitalized Lease Obligations between or among the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; plus
(c)the Parent Guarantor’s and the Restricted Subsidiaries non-cash interest expenses and interest that was capitalized during such period; plus
(d)the interest expense on Debt of another Person to the extent such Debt is guaranteed by the Parent Guarantor or any Restricted Subsidiary or secured by a Lien on the Parent Guarantor’s or any Restricted Subsidiary’s assets, but only to the extent that such interest is actually paid by the Parent Guarantor or such Restricted Subsidiary; minus
(e)the interest income of the Parent Guarantor and the Restricted Subsidiaries during such period.
Notwithstanding any of the foregoing, Consolidated Net Interest Expense shall not include any of the following:
(a)interest accrued, capitalized or paid in respect of Deeply Subordinated Funding;
(b)gains, losses, expenses or charges associated with refinancing of debt;
(c)gains, losses, expenses or charges associated with the total or partial extinguishment of debt;
(d)gains, losses, expenses or charges resulting from “mark to market” provisions or fair value charges applied to or resulting from derivatives; or
(e)any non-cash pension expense.
“Consolidated Non-cash Charges” means, for any period, the aggregate depreciation, amortization and other non-cash expenses of the Parent Guarantor and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS (excluding any such non-cash charge that requires an accrual of or reserve for cash charges for any future period).
“Consolidated Secured Debt Leverage Ratio” of the Parent Guarantor means, as of the date of determination, the ratio of (a) (i) the sum of consolidated Debt of the Parent Guarantor secured by Liens ranking equal to (by law or contract) the Liens on the Collateral securing the Notes on all or any portion of the Collateral (other than Debt incurred pursuant to clause (b)(ii) and clause (b)(xiii) of Section 4.06 and other than Debt described in clause (f) of the definition of “Debt”) less (ii) cash and Cash Equivalents on the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19 to (b) the aggregate consolidated EBITDA of the Parent Guarantor for the period of the most recent four consecutive quarters for which financial statements are available under Section 4.19 in each case with such pro forma adjustments to consolidated Debt and consolidated EBITDA as are appropriate and consistent with the pro forma provisions set forth in the definition of “Consolidated Fixed Charge Coverage Ratio”.
“Consolidated Tax Expense” means, for any period with respect to any Relevant Taxing Jurisdiction, the provision for all national, local and foreign federal, state or other income taxes of the Parent Guarantor and the Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with IFRS.
“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
“Contribution Debt” means Debt of the Parent Guarantor or any Restricted Subsidiary in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions and any such cash contributions that have been used to make a Restricted Payment or a Permitted Investment) made to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case, after the Issue Date, provided that (without prejudice to the rights of the Parent Guarantor and the Restricted Subsidiaries, including the right to divide and/or classify and/or reclassify as described in Section 4.06) such Contribution Debt is so designated as Contribution Debt pursuant to an Officer’s Certificate on the incurrence date thereof.
“Credit Facility” or “Credit Facilities” means one or more debt facilities, indentures or other arrangements with banks, insurance companies, other financial institutions or investors providing for revolving credit loans, term loans, notes, receivables financings, letters of credit or other forms of guarantees and assurances, or other Debt, including overdrafts, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, repaid or refinanced (and whether in whole or in part and whether or not with the original administrative agent or lenders or another administrative agent or agents or other
bank or institutions and whether provided under one or more other credit or other agreements, indentures, financing agreements or otherwise) and, for the avoidance of doubt, includes any agreement extending the maturity of, refinancing or restructuring all or any portion of the indebtedness under such agreements or any successor agreements.
“Currency Agreements” means, in respect of a Person, any spot or forward foreign exchange agreements and currency swap, currency option or other similar financial agreements or arrangements designed to protect such Person against or manage exposure to fluctuations in foreign currency exchange rates.
“Custodian” means any receiver, trustee, assignee, liquidator, custodian, administrator or similar official under any Bankruptcy Law.
“Debt” means, with respect to any Person, without duplication:
(a)all liabilities of such Person for borrowed money (including overdrafts) or for the deferred purchase price of property or services, excluding any trade payables and other accrued current liabilities incurred in the ordinary course of business;
(b)all obligations of such Person evidenced by bonds, notes, debentures or other similar instruments;
(c)all obligations, contingent or otherwise, of such Person in connection with any letters of credit, bankers’ acceptances, receivables facilities or other similar facilities;
(d)all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even if the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade payables arising in the ordinary course of business;
(e)all Capitalized Lease Obligations of such Person;
(f)all obligations of such Person under or in respect of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements; and
(g)all Redeemable Capital Stock of such Person valued at the greater of its voluntary maximum fixed repurchase price and involuntary maximum fixed repurchase price plus accrued and unpaid dividends;
if and to the extent any of the preceding items would appear as debt on a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS, provided that the term “Debt” shall not include (i) non-interest bearing installment obligations and accrued liabilities incurred in the ordinary course of business that are not more than 90 days past due; (ii) Debt in respect of the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of standby letters of credit, performance bonds or surety bonds provided by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business to the extent such letters of credit or bonds are not drawn upon or, if and to the extent drawn upon are honored in accordance with their terms and if, to be reimbursed, are reimbursed no later than the fifth Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit or bond; (iii) anything accounted for as an operating lease in accordance with the Election Option; (iv) any pension obligations of the Parent Guarantor or a Restricted Subsidiary;
(v) Debt incurred by the Parent Guarantor or one of the Restricted Subsidiaries in connection with a transaction where (x) such Debt is borrowed from a bank or trust company having a combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating immediately prior to the time such transaction is entered into, of at least A or the equivalent thereof by S&P and A2 or the equivalent thereof by Moody’s and (y) a substantially concurrent Investment is made by the Parent Guarantor or a Restricted Subsidiary in the form of cash deposited with the lender of such Debt, or a Subsidiary or Affiliate thereof, in amount equal to such Debt; and (vi) Deeply Subordinated Funding. In addition, “Debt” of the specified Person shall include all Debt of another Person secured by a Lien on any asset of the specified Person (whether or not such Debt is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of Debt of another Person, and Preferred Stock of any Restricted Subsidiary.
For purposes of this definition, the “maximum fixed repurchase price” of any Redeemable Capital Stock that does not have a fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Redeemable Capital Stock as if such Redeemable Capital Stock were purchased on any date on which Debt will be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the Fair Market Value of such Redeemable Capital Stock, such Fair Market Value will be determined in good faith by the Board of Directors of the issuer of such Redeemable Capital Stock; provided, that if such Redeemable Capital Stock is not then permitted to be redeemed, repaid or repurchased, the redemption, repayment or repurchase price shall be the book value of such Redeemable Capital Stock as reflected in the most recent financial statements of such Person.
“Deeply Subordinated Funding” means any funds provided to the Parent Guarantor pursuant to an agreement, note, security or other instrument, other than Capital Stock, that (i) is subordinated in right of payment to all Debt of the Parent Guarantor, (ii)(A) does not mature or require any amortization, redemption or other repayment of principal, (B) does not require payment of any cash interest or any similar cash amounts, and (C) contains no change of control or similar provisions and does not accelerate and has no right to declare a default or event of default or take any enforcement action or otherwise require any cash payment (other than as a result of insolvency proceedings of the Parent Guarantor), in each case prior to the 90th day following the repayment in full of the Notes and all other amounts due under this Indenture, (iii) does not provide for or require any security interest or encumbrance over any asset of the Parent Guarantor or any Restricted Subsidiary and (iv) does not contain any covenants (financial or otherwise) other than a covenant to pay such Deeply Subordinated Funding.
“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.
“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Parent Guarantor or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, executed by the principal financial officer of the Parent Guarantor, less the amount of Cash Equivalents received in connection with a subsequent sale, redemption, repurchase of, or collection or payment on, such Designated Non-cash Consideration.
“Disinterested Director” means, with respect to any transaction or series of related transactions, a member of the Parent Guarantor’s Board of Directors who does not have any material direct or indirect financial interest in or with respect to such transaction or series of related transactions or is not an Affiliate, or an officer, director or employee of any Person (other than the Parent Guarantor or any Restricted Subsidiary) who has any direct or indirect financial interest in or with respect to such transaction or series of related transactions; provided that no member of the Parent Guarantor’s Board of Directors shall be deemed to have any such direct or indirect financial interest solely as a result of such member’s ownership
of Capital Stock of the Parent Guarantor or any successor or any company holding shares, directly or indirectly, in the Parent Guarantor or such member’s serving on the Board of Directors of any company holding shares, directly or indirectly, in the Parent Guarantor.
“Disposition” has the meaning assigned to such term in the Offering Memorandum.
“Dollar Equivalent” means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for the determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published under “Currency Rates” in the section of the Financial Times entitled “Currencies, Bonds & Interest Rates” on the date that is two Business Days prior to such determination.
“DTC” means The Depository Trust Company, its nominees and successors.
“euro” or “€” means the lawful currency of the member states of the European Union who have agreed to share a common currency in accordance with the provisions of the Maastricht Treaty dealing with European monetary union.
“Euroclear” means Euroclear SA/NV or any successor thereof.
“European Government Obligations” means direct obligations (or certificates representing an ownership interest in such obligations) of a member state of the European Union (including any agency or instrumentality thereof) for the payment of which the full faith and credit of such government is pledged.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Excluded Contribution” means Net Cash Proceeds or property or assets received by the Parent Guarantor as capital contributions (other than Contribution Debt and any contributions used to make a Restricted Payment or a Permitted Investment) to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case of such capital contribution or Deeply Subordinated Funding, after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary or an employee stock ownership plan or trust established by the Parent Guarantor or any Subsidiary of the Parent Guarantor for the benefit of its employees to the extent funded by the Parent Guarantor or any Restricted Subsidiary) of Capital Stock (other than Redeemable Capital Stock) of the Parent Guarantor, in each case, to the extent designated as an Excluded Contribution pursuant to an Officer’s Certificate of the Parent Guarantor.
“Existing Ardagh Bonds” means (i) the Existing Secured Notes and (ii) the Existing Unsecured Notes and any other international debt securities of the Parent Guarantor or any of its Restricted Subsidiaries outstanding on the Issue Date.
“Existing Debt” means all Debt of the Parent Guarantor and its Restricted Subsidiaries outstanding on the Issue Date after giving effect to the issue of the Notes and the New Unsecured Notes and the use of proceeds therefrom.
“Existing Secured Notes” means the May 2016 Secured Notes and the March 2017 Secured Notes.
“Existing Unsecured Notes” means the May 2016 Senior Notes, the January 2017 Senior Notes and the June 2017 Senior Notes.
“F&S Carve‑out Subsidiaries” means Impress Belgium NV, Ardagh Metal Packaging Canada Limited, Ardagh Metal Packaging Czech Republic s.r.o., Ardagh Metal Packaging Hjørring A/S, Ardagh Group France SAS, Ardagh MP Group France SA, Ardagh Metal Packaging France SAS, Ardagh MP West France SAS, Ardagh Aluminium Packaging France SAS, Ardagh Germany MP GmbH, Ardagh Metal Packaging Germany GmbH, Ardagh Metal Packaging Hellas SA, Ardagh Metal Packaging Hungary Kft, Ardagh Aluminium Packaging Hungary Kft, Ardagh Metal Packaging Italy s.r.l., Ardagh Metal Packaging Japan Kabushiki Kaisha, Ardagh Metal Packaging Latvia SIA, Ardagh Metal Packaging Morocco SAS, Ardagh MP Group Netherlands B.V., Ardagh Metal Packaging Netherlands B.V., Ardagh Aluminium Packaging Netherlands B.V., Ardagh Russia Holdings 1 B.V., Ardagh Russia Holdings 2 B.V., Ardagh Metal Packaging Poland Sp. Z o.o, Ardagh Metal Packaging Buftea SA, Ardagh Metal Packaging Rus LLC, Ardagh Metal Packaging Kuban LLC, Ardagh Metal Packaging (Seychelles) Limited, Ardagh Metal Packaging Korea Chusik Hoesa, Ardagh Metal Packaging Iberica S.A.U., Ardagh Metal Packaging Ukraine LLC, Ardagh MP Holdings UK Limited, Ardagh Metal Packaging UK Limited, Impress Metal Packaging (Trustee) Limited, Impress Sutton Limited and Ardagh Metal Packaging USA Inc.
“Fair Market Value” means, with respect to any asset or property, the sale value that would be obtained in an arm’s-length free market 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 Parent Guarantor’s Board of Directors.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in section 1471(b) of the Code, or otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, or any law implementing an intergovernmental approach thereto.
“Guarantee” means any guarantee of the Issuers’ obligations under this Indenture and the Notes by the Parent Guarantor, any Restricted Subsidiary or any other Person in accordance with the provisions of this Indenture, including the Guarantees by the Guarantors dated as of the Issue Date. When used as a verb, “Guarantee” shall have a corresponding meaning.
“guarantees” means, as applied to any obligation,
(a)a guarantee (other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business), direct or indirect, in any manner, of any part or all of such obligation; and
(b)an agreement, direct or indirect, contingent or otherwise, the practical effect of which is to assure in any way the payment or performance (or payment of damages in the event of non-performance) of all or any part of such obligation, including, without limiting the foregoing, by the pledge of assets and the payment of amounts drawn down under letters of credit.
“Guarantor” means the Parent Guarantor and the Subsidiary Guarantors, together, and any other Person that is a guarantor of the Notes, including any Person that is required after the Issue Date to execute a guarantee of the Notes pursuant to Section 4.14 or Section 4.15 until a successor replaces such party pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such successor.
“Holder” means the Person in whose name a Note is registered on the Registrar’s books.
“IFRS” means International Financial Reporting Standards (formerly International Accounting Standards) endorsed from time to time by the European Union or any variation thereof with which the
Parent Guarantor or its Restricted Subsidiaries are, or may be, required to comply, as in effect on the Issue Date or, with respect to Section 4.19 as in effect from time to time. Except as otherwise set forth in this Indenture, all ratios and calculations based on IFRS (or, as applicable, GAAP) contained in this Indenture shall be computed in accordance with IFRS as in effect on the Issue Date (or, as applicable, GAAP as in effect at the date specified by the Parent Guarantor in its election to adopt GAAP in accordance with the fourth sentence of this definition). At any time after the Issue Date, the Parent Guarantor may elect to implement any new measures or other changes to IFRS (or, as applicable, GAAP) in effect on or prior to the date of such election; provided that any such election, once made, shall be irrevocable. At any time after the Issue Date, the Parent Guarantor may elect to apply GAAP accounting principles in lieu of IFRS and, upon any such election, references herein to IFRS shall thereafter be construed to mean GAAP (except as otherwise provided in this Indenture), including as to the ability of the Parent Guarantor to make an election pursuant to the previous sentence; provided that any such election, once made, shall be irrevocable; provided, further, that any calculation or determination in this Indenture that requires the application of IFRS for periods that include fiscal quarters ended prior to the Parent Guarantor’s election to apply GAAP shall remain as previously calculated or determined in accordance with IFRS; provided, further again, that the Parent Guarantor may only make such election if it also elects to report any subsequent financial reports required to be made by the Parent Guarantor. The Parent Guarantor shall give notice of any such election made in accordance with this definition to the Trustee and the Holders. Notwithstanding any of the foregoing, (i) in relation to the making of any determination or calculation under this Indenture, the Parent Guarantor shall be required to elect (the “Election Option”), from time to time and each time, either (A) to apply IFRS 16 (Leases) or (B) to apply IAS 17 (Leases) (or, in each case, the equivalent measure under GAAP) to the making of such determination or calculation, provided that, if such determination or calculation involves more than one element (including for the calculation of a financial ratio), such selected accounting standard shall be consistently applied to each element of such determination or calculation (other than, for the avoidance of doubt, in relation to Section 4.19); and (ii) any adverse impact directly or indirectly relating to or resulting from the implementation of IFRS 15 (Revenue from Contracts with Customers) and any successor standard thereto (or any equivalent measure under GAAP) shall be disregarded with respect to all ratios, calculations and determinations based upon IFRS to be calculated or made, as the case may be, pursuant to this Indenture (other than, for the avoidance of doubt, in relation to Section 4.19).
“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof.
“Intercreditor Agreement” means the Intercreditor Agreement entered into on December 7, 2010, as amended and restated most recently on March 21, 2017 and from time to time among, inter alios, Ardagh Packaging Finance, Ardagh Packaging Holdings and Citibank, N.A., London Branch, in its capacity as security agent thereunder and trustee for the Existing Secured Notes, and to which the Trustee will accede as soon as reasonably practicable.
“Interest Payment Date” means the Stated Maturity of an installment of interest on the Notes.
“Interest Rate Agreements” means, in respect of a Person, any interest rate protection agreements and other types of interest rate hedging agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements) designed to protect such Person against or manage exposure to fluctuations in interest rates.
“Investment” means, with respect to any Person, any direct or indirect advance, loan or other extension of credit (including guarantees) or capital contribution to (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 others), or any
purchase, acquisition or ownership by such Person of any Capital Stock, bonds, notes, debentures or other securities or evidences of Debt issued or owned by, any other Person and all other items that would be classified as investments on a balance sheet prepared in accordance with IFRS. In addition, the portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary will be deemed to be an “Investment” that the Parent Guarantor made in such Unrestricted Subsidiary at such time. The portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Unrestricted Subsidiary at the time that such Unrestricted Subsidiary is designated a Restricted Subsidiary will be considered a reduction in outstanding Investments. “Investments” excludes extensions of trade credit on commercially reasonable terms in accordance with normal trade practices.
“Investment Grade Status” shall occur when the Notes receive both of the following:
(1)a rating of “BBB-” or higher from S&P; and
(2)a rating of “Baa3” or higher from Moody’s;
or the equivalent of such rating by either such rating organization or, if no rating of Moody’s or S&P then exists, the equivalent of such rating by any other Nationally Recognized Statistical Rating Organization.
“IP Cross License Agreement” means the IP Cross-License Agreement, as defined in the Offering Memorandum.
“Issue Date” means August 12, 2019.
“Issuers Order” means a written order signed in the name of the Issuers by any Person authorized by a resolution of the Board of Directors of each Issuer.
“January 2017 Senior Notes” means the existing $1,000,000,000 aggregate principal amount of 6.000% Senior Notes and $700,000,000 aggregate principal amount of 6.000% additional Senior Notes due 2025 issued by the Issuers.
“June 2017 Senior Notes” means the existing £400,000,000 aggregate principal amount of 4.750% Senior Notes due 2027 issued by the Issuers on June 12, 2017.
“Lien” means any mortgage or deed of trust, charge, pledge, lien (statutory or otherwise), privilege, security interest, hypothecation, assignment for security, standard security, assignation in security claim, or preference or priority or other encumbrance upon or with respect to any property of any kind, real or personal, movable or immovable, now owned or hereafter acquired. A Person shall be deemed to own subject to a Lien any property which such Person has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement.
“March 2017 Secured Notes” means the existing $715,000,000 aggregate principal amount of 4.250% Senior Secured Notes due 2022 and the existing €750,000,000 aggregate principal amount of 2.750% Senior Secured Notes due 2024 issued by the Issuers on March 8, 2017.
“Material Subsidiary” means any Restricted Subsidiary or group of Restricted Subsidiaries (taken together) that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date, measured, as
of the last day of the most recent fiscal quarter for which financial statements are available or for the four fiscal quarters ended most recently for which financial statements are available, as the case may be.
“Maturity” means, with respect to any indebtedness, the date on which any principal of such indebtedness becomes due and payable as therein or herein provided, whether at the Stated Maturity with respect to such principal or by declaration of acceleration, call for redemption or purchase or otherwise.
“May 2016 Secured Notes” means the existing $500,000,000 aggregate principal amount of Floating Rate Notes due 2021, the existing €440,000,000 aggregate principal amount of 4.125% Senior Secured Notes due 2023 and the existing $1,000,000,000 aggregate principal amount of 4.625% Senior Secured Notes due 2023 issued by the Issuers on May 16, 2016.
“May 2016 Senior Notes” means the existing €750,000,000 aggregate principal amount of 6.750% Senior Notes due 2024 and the existing $1,650,000,000 aggregate principal amount of 7.250% Senior Notes due 2024 issued by the Issuers on May 16, 2016.
“Moody’s” means Moody’s Investors Service, Inc. and its successors.
“Mutual Services Agreement” means the Mutual Services Agreement defined in the Offering Memorandum and any modification, amendment, replacement or extension or any similar agreement.
“Nationally Recognized Statistical Rating Organization” means a nationally recognized statistical rating organization within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act.
“Net Cash Proceeds” means:
(a)with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents including (x) payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor or any Restricted Subsidiary) and (y) any cash or Cash Equivalents received upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale, net of:
(i)brokerage commissions and other fees and expenses (including, without limitation, fees and expenses of legal counsel, accountants, investment banks and other consultants) related to such Asset Sale;
(ii)provisions for all taxes paid or payable, or required to be accrued as a liability under IFRS as a result of such Asset Sale;
(iii)all distributions and other payments required to be made to any Person (other than the Parent Guarantor or any Restricted Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale; and
(iv)appropriate amounts required to be provided by the Parent Guarantor or any Restricted Subsidiary, as the case may be, as a reserve in accordance with IFRS against any liabilities associated with such Asset Sale and retained by the Parent Guarantor or any Restricted Subsidiary, 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, all as reflected in an Officer’s Certificate delivered to the Trustee; and
(b)with respect to any capital contributions, issuance or sale of Capital Stock or options, warrants or rights to purchase Capital Stock, or debt securities or Capital Stock that have been converted into or exchanged for Capital Stock as referred to in Section 4.08, the proceeds of such issuance or sale in the form of cash or Cash Equivalents, payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed of for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor or any Restricted Subsidiary), net of attorney’s fees, accountant’s fees and brokerage, consultation, underwriting and other fees and expenses actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.
“New Unsecured Notes” means the senior unsecured notes issued by the Issuers concurrently with the Notes on the Issue Date.
“Offering Memorandum” means the confidential offering memorandum of the Issuers, dated July 30, 2019 relating to the Notes.
“Officer’s Certificate” means a certificate signed by an officer of the Parent Guarantor, either Issuer, a Guarantor or a Surviving Entity, as the case may be, and delivered to the Trustee.
“Opinion of Counsel” means a written opinion from legal counsel. The counsel may be an employee of or counsel to the Issuers.
“Pari Passu Debt” means (a) any Debt of the applicable Issuer that ranks equally in right of payment with the Notes or (b) with respect to any Guarantee, any Debt that ranks equally in right of payment to such Guarantee.
“Parties” means the Issuers, the Parent Guarantor, the Trustee, the Principal Paying Agent and the Security Agent and any other party from time to time hereto (each, a “Party”).
“Permitted Collateral Lien” means the following types of Liens:
(a)Liens securing the Notes issued on the Issue Date, the Existing Secured Notes and, in each case, any Permitted Refinancing Debt incurred to refinance such notes;
(b)Liens on the Collateral to secure Debt permitted under Section 4.06; provided that the assets and properties securing such Debt will also secure the Notes on a first ranking basis; and provided, further, that, following the incurrence of such Debt secured by such Liens on the Collateral and giving effect to the application of the proceeds thereof, on a pro forma basis, the Consolidated Secured Debt Leverage Ratio for the four full fiscal quarters for which financial statements are available immediately preceding the incurrence of such Debt, taken as one period, would be less than 3.50 to 1.0;
(c)Liens on the Collateral to secure Debt permitted under clauses (ii), (iv), (v) (to the extent such guarantee is in respect of Debt otherwise permitted to be secured and is specified in this definition of “Permitted Collateral Liens”), (vi), (viii), (ix),(x), (xv), (xviii) and (xix) in Section 4.06(b) (provided, however, that at the time of incurrence of such Debt secured by such Liens on the Collateral and giving effect to the application of the proceeds thereof,
on a pro forma basis, (1) the Consolidated Secured Debt Leverage Ratio for the four fiscal quarters for which financial statements are available immediately preceding the incurrence of such Debt, taken as one period, would be less than 3.50 to 1.0 or (2) the Consolidated Secured Debt Leverage Ratio of the Parent Guarantor and its Restricted Subsidiaries would not be greater than it was immediately prior to giving effect to such acquisition or other transaction), Section 4.06(b)(xx) and Section 4.06(b)(xxi);
(d)Liens on Collateral to secure Debt permitted under Section 4.06(b)(xiii); provided that such Liens do not extend to assets other than the accounts receivable (and related assets) that are the subject of the related Permitted Receivables Financing;
(e)Liens of the type described in clauses (g), (h), (i), (j), (k), (l), (m), (n), (o), (q), (r) and (v) of the definition of “Permitted Liens”; and
(f)any extension, renewal or replacement, in whole or in part, of any Lien described in the foregoing clauses (a) through (e); provided that any such extension, renewal or replacement will be of the same priority and be no more restrictive in any material respect than the Lien so extended, renewed or replaced and will not extend in any material respect to any additional property or assets.
“Permitted Debt” has the meaning given to such term under Section 4.06(b).
“Permitted Holders” means (a) Yeoman Capital S.A., (b) any of Paul Coulson, Brendan Dowling, Houghton Fry, Edward Kilty, John Riordan or Niall Wall, and any trust created for the benefit of one or more of the foregoing or their respective natural person Affiliates, or the estate, executor, administrator, committee or beneficiaries of any thereof, and (c) any of their respective Affiliates.
“Permitted Investments” means any of the following:
(a)Investments in cash or Cash Equivalents;
(b)intercompany Debt to the extent permitted under clause (iv) of the definition of “Permitted Debt”;
(c)Investments in (i) the form of loans borrowed by or advances to, or debt securities issued by, the Parent Guarantor, (ii) a Restricted Subsidiary or (iii) another Person if as a result of such Investment such other Person becomes a Restricted Subsidiary or such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, the Parent Guarantor or a Restricted Subsidiary;
(d)Investments made by the Parent Guarantor or any Restricted Subsidiary as a result of or retained in connection with an Asset Sale that does not violate Section 4.09;
(e)expenses or advances to cover payroll, travel, entertainment, moving, other relocation and similar matters;
(f)Investments in the Notes, the New Unsecured Notes and the Existing Ardagh Bonds;
(g)Investments existing at the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on, or made pursuant to a binding
commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased as required by the terms of such Investment existing on the Issue Date;
(h)Investments in Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements permitted under Section 4.06(b)(viii), Section 4.06(b)(ix) and Section 4.06(b)(x) ;
(i)Investments made in the ordinary course of business, the Fair Market Value of which in the aggregate does not exceed $15,000,000 in any fiscal year in any transaction or series of related transactions;
(j)loans and advances (or guarantees to third‑party loans) to directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary made in the ordinary course of business and consistent with the Parent Guarantor’s past practices or past practices of the Restricted Subsidiaries, as the case may be, in an amount outstanding not to exceed at any one time the greater of $30,000,000 and 0.5% of Total Assets;
(k)Investments in a Person to the extent that the consideration therefor consists of the issue and sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding or the net proceeds thereof (other than any Excluded Contribution or the proceeds of any Contribution Debt); provided that the net proceeds of such sale have been excluded from, and shall not have been included in, the calculation of the amount determined under clause (b)(iii)(B) of Section 4.08;
(l)pledges or deposits with respect to leases or utilities provided to third parties in the ordinary course of business;
(m)Investments of the Parent Guarantor or the Restricted Subsidiaries described under item (v) to the proviso to the definition of “Debt”;
(n)Investments, the amount of which, measured by reference to the Fair Market Value of each such Investment on the date it was made, not to exceed the sum of (x) the greater of $300,000,000 and 4.0% of Total Assets in the aggregate outstanding at any one time and (y) the sum of (i) the aggregate net after-tax amount returned in cash or through interest payments, principal payments, dividends or other distributions or payments on account of such Investment and (ii) the net after-tax cash proceeds received by the Parent Guarantor or any Restricted Subsidiary from the disposition of all or any portion of such Investments (other than to a Subsidiary); provided, however, that such net after-tax amounts have not been included in Consolidated Adjusted Net Income for the purpose of calculating clause (b)(iii)(A) of Section 4.08;
(o)Investments resulting from the acquisition of a Person that at the time of such acquisition held instruments constituting Investments that were not acquired in contemplation of the acquisition of such Person;
(p)Investments by the Parent Guarantor or any Restricted Subsidiary in connection with a Permitted Receivables Financing;
(q)loans or advances to (i) directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof pursuant to management equity plans or
similar management or employee benefit arrangement or (ii) stock option plans, trust and similar asset pools to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof not to exceed the greater of $30,000,000 and 0.5% of Total Assets in the aggregate outstanding at any one time;
(r)(i) stock, obligations or securities received in satisfaction of judgments, foreclosure of liens, or settlement of debts or arbitration awards, and (ii) any Investments received in compromise of obligations of such persons incurred in the ordinary course of trade creditors or customers that were incurred in the ordinary course of business, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer;
(s)any Investments received in comprise or resolution of litigation, arbitration or other disputes;
(t)any guarantee of Debt permitted to be incurred by Section 4.06, performance guarantees and contingent obligations incurred in the ordinary course of business and creation of Liens on the assets of the Parent Guarantor or any Restricted Subsidiary in compliance with Section 4.07;
(u)any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with Section 4.10(b) (except transactions described in sub-clauses (ii), (v) and (x) thereof);
(v)advances, loans, rebates and extensions of credit (including the creation of receivables) to suppliers, customers and vendors, and advance payment made and deferred consideration and performance guarantees, in each case in the ordinary course of business; and
(w)any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business.
“Permitted Joint Venture” means any joint venture or similar combinations or other transaction pursuant to which the Parent Guarantor or any Restricted Subsidiary enters into, acquires or subscribes for any shares, stock, securities or other interest in or transfers any assets to any joint venture; provided, however, that the primary business of such joint venture is a Similar Business.
“Permitted Liens” means the following types of Liens:
(a)Liens existing as of the Issue Date;
(b)Liens on any property or assets of the Parent Guarantor or a Restricted Subsidiary to secure Debt permitted to be incurred pursuant to Section 4.06(b)(ii);
(c)Liens on assets given, disposed of, or otherwise transferred in connection with a Permitted Receivables Financing permitted to be incurred pursuant to Section 4.06(b)(xiii);
(d)Liens on any property or assets of a Restricted Subsidiary granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(e)Liens on any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets securing the Notes or any Guarantees;
(f)any interest or title of a lessor under any Capitalized Lease Obligation and Liens to secure Debt (including Capitalized Lease Obligations) permitted under Section 4.06 covering only the assets acquired with such Debt;
(g)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business;
(h)statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen, employees, pension plan administrators or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings or Liens arising solely by virtue of any statutory or common law provisions relating to attorney’s liens or bankers’ liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depositary institution;
(i)Liens for taxes, assessments, government charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings for which a reserve or other appropriate provision, if any, as shall be required in conformity with IFRS shall have been made;
(j)Liens incurred or deposits made to secure the performance of tenders, bids or trade or government contracts, or to secure leases, statutory or regulatory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business (other than obligations for the payment of money);
(k)zoning restrictions, easements, licenses, reservations, title defects, rights of others for rights-of-way, utilities, sewers, electrical lines, telephone lines, telegraph wires, restrictions, encroachments and other similar charges, encumbrances or title defects and incurred in the ordinary course of business that do not in the aggregate materially interfere with in any material respect the ordinary conduct of the business of the Parent Guarantor and its Restricted Subsidiaries on the properties subject thereto, taken as a whole;
(l)Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
(m)Liens on property existing at the time such property is acquired or on property of, or on shares of Capital Stock or Debt of, any Person existing at the time such Person is acquired by, merged with or into or consolidated with, the Parent Guarantor or any Restricted Subsidiary; provided that such Liens (i) do not extend to or cover any property or assets of the Parent Guarantor or any Restricted Subsidiary other than (A) the property or assets acquired or (B) the property or assets of the Person acquired, merged with or into or consolidated with the Parent Guarantor or Restricted Subsidiary and (ii) were created prior to, and not in connection with or in contemplation of such acquisition, merger or consolidation;
(n)Liens securing the Parent Guarantor’s or any Restricted Subsidiary’s obligations under Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements permitted under Sections 4.06(b)(viii), 4.06(b)(ix) and 4.06(b)(x) or any collateral for the Debt to which such Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements relate;
(o)Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or other insurance (including unemployment insurance) or deposits to secure public or statutory obligations of such Person or deposits of cash or government bonds to secure performance, bid, surety or appeal bonds and completion bonds and guarantees to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;
(p)Liens incurred in connection with a cash management program established in the ordinary course of business;
(q)Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Parent Guarantor or any Restricted Subsidiary, including rights of offset and set-off;
(r)any extension, renewal or replacement, in whole or in part, of any Permitted Lien; provided that any such extension, renewal or replacement shall not extend in any material respect to any additional property or assets;
(s)Liens securing Debt incurred to refinance Permitted Refinancing Debt permitted to be incurred under this Indenture; provided that any such Lien shall not extend to or cover materially any assets not securing the Debt so refinanced plus improvements and accessions to such property and assets and proceeds and distributions thereof;
(t)purchase money Liens to finance property or assets of the Parent Guarantor or any Restricted Subsidiary acquired in the ordinary course of business; provided that the related purchase money Debt shall not exceed the cost of such property or assets and shall not be secured by any property or assets of the Parent Guarantor or any Restricted Subsidiary other than the property and assets so acquired;
(u)Permitted Collateral Liens;
(v)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;
(w)Liens over the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture that secures Debt of such Unrestricted Subsidiary or Permitted Joint Venture;
(x)Liens incurred in the ordinary course of business of the Parent Guarantor or any Restricted Subsidiary with respect to an amount that does not exceed the greater of $225,000,000 and 3.0% of Total Assets at any one time outstanding and any replacements, extensions, modifications or renewals thereof;
(y)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created in
the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(z)leases, licenses, subleases and sublicenses of assets in the ordinary course of business;
(aa) Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third-party relating to such property or assets;
(bb) Liens on equipment of the Issuer or any Restricted Subsidiary granted in the ordinary course of business;
(cc)customary Liens on and in respect of deposits required in connection with the purchase of property, equipment and inventory, in each case incurred in the ordinary course of business;
(dd)(i) Liens on escrowed proceeds for the benefit of the related holders of debt securities or other Debt (or the underwriters or arrangers thereof) or (ii) Liens on cash set aside at the time of the incurrence of any Debt or government securities purchased with such cash, in either case, to the extent such cash or government securities prefund the payment of interest on such Debt and are held in escrow accounts or similar arrangements to be applied for such purpose; and
(ee)Liens on assets or property of a Restricted Subsidiary that is not a Subsidiary Guarantor securing Indebtedness and other Obligations of any Restricted Subsidiary that is not a Subsidiary Guarantor.
“Permitted Receivables Financing” means any financing pursuant to which the Parent Guarantor or any Restricted Subsidiary may sell, convey or otherwise transfer to any other Person or grant a security interest in, any accounts receivable (and related assets) in an aggregate principal amount equivalent to the Fair Market Value of such accounts receivable (and related assets) of the Parent Guarantor or any Restricted Subsidiary; provided that (a) the covenants, events of default and other provisions applicable to such financing shall be customary for such transactions and shall be on market terms (as determined in good faith by the Parent Guarantor’s Board of Directors) at the time such financing is entered into, (b) the interest rate applicable to such financing shall be a market interest rate (as determined in good faith by the Parent Guarantor’s Board of Directors) at the time such financing is entered into, and (c) such financing shall be non-recourse to the Parent Guarantor or any Restricted Subsidiary except to a limited extent customary for such transactions.
“Permitted Refinancing Debt” means any renewals, extensions, substitutions, refinancings or replacements (each, for purposes of this definition and Section 4.06(b)(xiv), a “refinancing”) of any Debt of the Parent Guarantor or a Restricted Subsidiary or pursuant to this definition, including any successive refinancings, so long as:
(a)such Debt is in an aggregate principal amount (or if incurred with original issue discount, an aggregate issue price) not in excess of the sum of (i) the aggregate principal amount (or if incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being refinanced and (ii) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, related to such refinancing;
(b)the Average Life of such Debt is equal to or greater than the Average Life of the Debt being refinanced;
(c)the Stated Maturity of such Debt is no earlier than the Stated Maturity of the Debt being refinanced;
(d)the new Debt is not senior in right of payment to the Debt that is being refinanced; and
(e)such Debt is unsecured or is secured by a Silent Second Lien, if the Debt being refinanced is unsecured.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, winding up or corporate reconstruction, directly or indirectly, in one or a series of related transactions involving the Parent Guarantor or any of its Restricted Subsidiaries (a “Reorganization”) that is made on a solvent basis; provided that any payments or assets distributed in connection with such Reorganization remain within the applicable Issuer and its Restricted Subsidiaries. For the avoidance of doubt, the term “Permitted Reorganization” shall include the closure of bank accounts and the conversion of debt instruments into Capital Stock or other equity instruments.
“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“Preferred Stock” means, with respect to any Person, Capital Stock of any class or classes (however designated) of such Person which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over the Capital Stock of any other class of such Person whether now outstanding, or issued after the Issue Date, and including, without limitation, all classes and series of preferred or preference stock of such Person.
“pro forma” means, with respect to any calculation made or required to be made pursuant to the terms of this Indenture, a calculation made in good faith by a responsible financial or accounting officer of the Parent Guarantor; provided that any such calculation shall (x) give effect to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given, as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation and (y) eliminate any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering of debt or equity securities.
“Property” means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock, and other securities of, any other Person. For purposes of any calculation required pursuant to this Indenture, the value of any Property shall be its Fair Market Value.
“Public Equity Offering” means an offer and sale of Qualified Capital Stock that are listed on an international securities exchange or publicly offered (which shall include an offering pursuant to Rule 144A and/or Regulation S under the Securities Act to professional market investors or similar persons).
“QIB” means a “Qualified Institutional Buyer” as defined in Rule 144A.
“Qualified Capital Stock” of any Person means any and all Capital Stock of such Person other than Redeemable Capital Stock.
“Record Date” for the interest payable on any Interest Payment Date means the Business Day immediately preceding such Interest Payment Date.
“Redeemable Capital Stock” means any class or series of Capital Stock that, either by its terms, by the terms of any security into which it is convertible or exchangeable, or by contract or otherwise, is, or upon the happening of an event or passage of time would be, required to be redeemed prior to the final Stated Maturity of the Notes or is redeemable at the option of the holder thereof at any time prior to such final Stated Maturity (other than upon a Change of Control of the Parent Guarantor in circumstances in which the Holders would have similar rights), or is convertible into or exchangeable for debt securities at any time prior to such final Stated Maturity; provided that any Capital Stock that would constitute Qualified Capital Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of any “asset sale” or “change of control” occurring prior to the Stated Maturity of the Notes will not constitute Redeemable Capital Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Section 4.09 and Section 4.11 and such Capital Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Parent Guarantor’s or the Issuers’ repurchase of such Notes as are required to be repurchased pursuant to Section 4.09 and Section 4.11.
“Redemption Date” means, when used with respect to any Note to be redeemed, in whole or in part, the date fixed for such redemption by or pursuant to this Indenture.
“Redemption Price” means, when used with respect to any Note to be redeemed, the price at which it is to be redeemed pursuant to this Indenture.
“Refinance” means, with respect to any Debt, to amend, modify, extend, substitute, renew, replace, refund, prepay, repay, repurchase, redeem, defease or retire, or to issue other Debt, in exchange or replacement for, such Debt. “Refinanced” and “Refinancing” shall have correlative meanings.
“Regulation S” means Regulation S under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Replacement Assets” means properties and assets that replace the properties and assets that were the subject of an Asset Sale or properties and assets that are, or will be, used in the Parent Guarantor’s business or in that of the Restricted Subsidiaries or in a Similar Business or any and all businesses that in the good faith judgment of the Board of Directors of the Parent Guarantor are reasonably related, and, in each case, any capital expenditure relating thereto.
“Restricted Investment” means any Investment other than a Permitted Investment.
“Restricted Subsidiary” means any Subsidiary of the Parent Guarantor other than an Unrestricted Subsidiary.
“Reversion Date” means, after the Notes have achieved Investment Grade Status, the date, if any, that such Notes shall cease to have such Investment Grade Status.
“Rule 144” means Rule 144 under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Rule 144A” means Rule 144A under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“S&P” means Standard and Poor’s Ratings Service, a division of The McGraw-Hill Companies, Inc. and its successors.
“Securities Act” means the U.S. Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Security Agent” means Citibank, N.A., London Branch, and its successors, as security agent under the Intercreditor Agreement, and any additional security agent or sub-agent.
“Security Documents” means, collectively, all security agreements, mortgages, standard securities, deeds of trust, pledges, collateral assignments and other agreements or instruments evidencing or creating any security entered into by the Parent Guarantor or any of its Subsidiaries pursuant to Section 4.14 of this Indenture in favor of the Security Agent or any Holders in any or all of the Collateral, the Intercreditor Agreement and any Additional Intercreditor Agreement, in each case as amended from time to time in accordance with their terms and the terms of this Indenture.
“Security Interests” means security interests in the Collateral securing the Notes and the Guarantees.
“Senior Holdco Notes” means (i) the existing €845,000,000 aggregate principal amount of 6.625% / 7.375% Senior Secured Toggle Notes due 2023 and $770,000,000 aggregate principal amount of 7.125% / 7.875% Senior Secured Toggle Notes due 2023 issued by ARD Finance S.A. on September 16, 2016 and (ii) the existing $350,000,000 aggregate principal amount of 8.750% Senior Secured PIK Notes due 2023 issued by ARD Securities Finance SARL on January 23, 2018 and, in each case, any replacements or refinancings thereof, directly or indirectly.
“Silent Second Liens” means Liens granted in favor of Debt (the “second priority Debt”) on property or assets of the Parent Guarantor or any of its Restricted Subsidiaries that:
(a)are by law or under the terms of an intercreditor agreement reasonably acceptable to the Trustee second in priority to first priority Liens on such property or assets; and
(b)are subject to arrangements in form and substance reasonably satisfactory to the Trustee which provide (x) that any payments on enforcement of the Liens in such property or assets (other than payments to the security agent, trustee, administrative agent or other representative of the holders of the second priority Debt) to the holders of the second priority Debt (or their representatives) will only be made once the Debt secured by the first priority Liens on such property or assets have been satisfied in full and (y) that the holders of the second priority Debt (and their representatives) will have no ability to cause the enforcement of, or direct the relevant security agent in the enforcement of, the Liens in such property or assets until the Debt secured by the first priority Liens on such property or assets have been satisfied in full.
“Similar Business” means any business, service or other activity engaged in by the Parent Guarantor or any Restricted Subsidiaries of the Parent Guarantor on the Issue Date and any business, service or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which the Parent Guarantor and the Restricted Subsidiaries are engaged on the Issue Date or any business that, in the good faith business judgment of the
Parent Guarantor, constitutes a reasonable diversification of business conducted by the Parent Guarantor and its Subsidiaries.
“Stated Maturity” means, when used with respect to any note or any installment of interest thereon, the date specified in such note as the fixed date on which the principal of such note or such installment of interest, respectively, is due and payable, and, when used with respect to any other indebtedness, means the date specified in the instrument governing such indebtedness as the fixed date on which the principal of such indebtedness, or any installment of interest thereon, is due and payable.
“Sterling” or “£” means the lawful currency of the United Kingdom of Great Britain and Northern Ireland.
“Subordinated Debt” means Debt of either Issuer or any of the Guarantors (other than the Existing Ardagh Bonds, the Notes, the New Unsecured Notes and any Permitted Refinancing Debt in respect of the foregoing) that is subordinated in right of payment to the Notes or the Guarantees of such Guarantors, as the case may be; provided that no Debt shall be deemed to be subordinated in right of payment to any other Debt solely by virtue of being unsecured or by virtue of being secured on a junior Lien basis.
“Subsidiary” means, with respect to any Person:
(a)a corporation a majority of whose Voting Stock is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof; and
(b)any other Person (other than a corporation), including, without limitation, a partnership, limited liability company, business trust or joint venture, in which such Person, one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other Person performing similar functions).
“Subsidiary Guarantee” means any Guarantee given by a Subsidiary Guarantor.
“Subsidiary Guarantors” means any Restricted Subsidiary that provides a Guarantee, in each case until it is released from its obligations under its Guarantee and this Indenture in accordance with the terms of this Indenture.
“TARGET Day” means a day on which the trans‑European Automated Real-time Gross Settlement Express Transfer system is operating.
“Total Assets” means the consolidated total assets of the Parent Guarantor and its Restricted Subsidiaries as shown on the most recent consolidated balance sheet of the Parent Guarantor.
“Total Inventories” means, as of any date, the amount of raw materials, packaging materials, work-in-progress and finished goods of the Parent Guarantor and the Restricted Subsidiaries, net of any provisions in respect of the foregoing items, in each case as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Total Receivables” means, as of any date, (a) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries plus (b) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries that has been sold, conveyed or otherwise transferred in Permitted
Receivables Financings and is outstanding, in each case, as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Transaction Agreement” means the transaction agreement dated July 14, 2019, among Ardagh Group S.A., Element Holdings II L.P. and Trivium Packaging B.V. as described in the Offering Memorandum.
“Transactions” shall have the meaning assigned to such term in the Offering Memorandum.
“Treasury Rate” means, as of any Redemption Date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the Redemption Date) of the yield to maturity of United States Treasury securities with a constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 Redemption Date to August 15, 2022; provided, however, that if the period from the Redemption Date to August 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Redemption Date to August 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
“Trust Officer” means any officer within the agency and corporate trust group, division or section of the Trustee (however named, or any successor group of the Trustee) and also means, with respect to any particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“Unrestricted Subsidiary” means:
(a)any Subsidiary of the Parent Guarantor that at the time of determination is an Unrestricted Subsidiary (as designated by the Parent Guarantor’s Board of Directors pursuant to Section 4.17);
(b)any Subsidiary of an Unrestricted Subsidiary; and
(c)Enville Limited, UniMould S.A., Ardagh Packaging Finance UK Limited, Ardagh Metal Packaging Italy Srl (Teramo), Recan GmbH, Impress Metal Packaging (Trustee) Limited and Recan UK Limited.
“U.S. dollar” or “$” means the lawful currency of the United States of America.
“U.S. Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America, and the payment for which the United States of America pledges its full faith and credit.
“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors, managers or trustees (or Persons performing similar functions) of any Person (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency).
“Wholly Owned Restricted Subsidiary” means any Restricted Subsidiary, all of the outstanding Capital Stock (other than directors’ qualifying shares or shares of Restricted Subsidiaries required to be owned by third parties pursuant to applicable law) of which are owned by the Parent Guarantor or by one or more other Wholly Owned Restricted Subsidiaries or by the Parent Guarantor and one or more other Wholly Owned Restricted Subsidiaries.
Term |
Defined in Section |
“Additional Amounts”............................................................................................................. |
4.12(a) |
“Additional Dollar Notes”......................................................................................................... |
Recitals |
“Additional Euro Notes”........................................................................................................... |
Recitals |
“Additional Notes”................................................................................................................... |
Recitals |
“Additional Intercreditor Agreement”....................................................................................... |
4.13(a) |
“Additional Notes”................................................................................................................... |
Recitals |
“Agents”................................................................................................................................... |
2.03 |
“Authorized Agent”................................................................................................................. |
12.08 |
“Change of Control Offer”......................................................................................................... |
4.11(a) |
“Change of Control Purchase Date”........................................................................................... |
4.11(a) |
“Change of Control Purchase Price”........................................................................................... |
4.11(a) |
“covenant defeasance”........................................................................................................... |
8.03 |
“Defaulted Interest”................................................................................................................. |
2.12 |
“Dollar Notes”......................................................................................................................... |
Recitals |
“Election Option”..................................................................................................................... |
Definition of IFRS |
“Euro Notes”........................................................................................................................... |
Recitals |
“Event of Default”................................................................................................................... |
6.01(a) |
“Excess Proceeds”................................................................................................................... |
4.09(b) |
“Excess Proceeds Offer”........................................................................................................... |
4.09(c) |
“Global Notes”......................................................................................................................... |
2.01(c) |
“Holdings USA Disposition”....................................................................................................... |
12.01(a) |
“incur”....................................................................................................................................... |
4.06(a) |
“incurrence”........................................................................................................................... |
4.06(a) |
“Interest Amount”................................................................................................................... |
12.15 |
Term |
Defined in Section |
“Irish Issuer”........................................................................................................................... |
Preamble |
“Issuers”................................................................................................................................... |
Preamble |
“legal defeasance”................................................................................................................... |
8.02 |
“Notes”..................................................................................................................................... |
Recitals |
“Obligations”........................................................................................................................... |
10.01(a) |
“Original Dollar Notes”............................................................................................................. |
Recitals |
“Original Euro Notes”............................................................................................................... |
Recitals |
“Original Notes”....................................................................................................................... |
Recitals |
“Parent Guarantor”................................................................................................................. |
Preamble |
“Participants”........................................................................................................................... |
2.01(c) |
“Paying Agent”....................................................................................................................... |
2.03 |
“Permitted Debt”..................................................................................................................... |
4.06(b) |
“Permitted Payments”............................................................................................................. |
4.08(c) |
“Principal Paying Agent”........................................................................................................... |
Preamble |
“Registrar”............................................................................................................................... |
2.03 |
“Regulation S Dollar Global Note”............................................................................................. |
2.01(b) |
“Regulation S Euro Global Note”............................................................................................... |
2.01(b) |
“Regulation S Global Note”....................................................................................................... |
2.01(b) |
“Relevant Fiscal Year”............................................................................................................... |
4.08(c)(xi) |
“Relevant Taxing Jurisdiction”................................................................................................... |
4.12(a) |
“Required Currency”............................................................................................................... |
12.14 |
“Restricted Dollar Global Note”................................................................................................. |
2.01(b) |
“Restricted Euro Global Note”................................................................................................... |
2.01(b) |
“Restricted Global Note”......................................................................................................... |
2.01(b) |
“Restricted Payment”............................................................................................................... |
4.08(a) |
“Security Confirmations”........................................................................................................... |
4.13 |
“Security Register”................................................................................................................... |
2.03 |
“Surviving Entity”..................................................................................................................... |
5.01(b)(i) |
Term |
Defined in Section |
“Suspension Event”................................................................................................................. |
4.22 |
“Taxes”..................................................................................................................................... |
4.12(a) |
“Transfer Agent”..................................................................................................................... |
2.03 |
“Trustee”................................................................................................................................. |
Preamble |
“U.S. Issuer”............................................................................................................................. |
Preamble |
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(i) a term has the meaning assigned to it; |
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(ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS; |
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(iii) “or” is not exclusive; |
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(iv) “including” or “include” means including or include without limitation; |
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(v) words in the singular include the plural and words in the plural include the singular; |
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(vi) unsecured or unguaranteed Debt shall not be deemed to be subordinate or junior to secured or guaranteed Debt merely by virtue of its nature as unsecured or unguaranteed Debt; and |
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(vii) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, clause or other subdivision. |
been exceeded as a result of such fluctuations solely for purposes of determining whether such acquisition and any related transactions are permitted hereunder and (B) such ratios shall not be tested at the time of consummation of such acquisition, transaction, merger, amalgamation or consolidation; provided that if the Parent Guarantor elects to have such determinations occur at the time of entry into such definitive agreement, put option or similar arrangement, (i) any such transaction shall be deemed to have occurred on the date the definitive agreement, put option or similar arrangement is entered into and to be outstanding thereafter for purposes of calculating any ratios under this Indenture after the date of such agreement and before the earlier of the date of consummation of such acquisition or the date such agreement is terminated or expires without consummation of such acquisition and (ii) to the extent any covenant baskets were utilized in satisfying any covenants, such baskets shall be deemed utilized until the earlier of the date of consummation of such acquisition or the date such agreement is terminated or expires without consummation of such acquisition, but any calculation of Consolidated Adjusted Net Income for purposes of other incurrences of Debt or Liens or making of Restricted Payments (not related to such acquisition) shall not reflect such acquisition until it has been consummated unless such other incurrence of Debt or Liens is conditional or contingent on the occurrence of such acquisition or Change of Control or (b) the date such Debt is borrowed or assumed or such Change of Control occurs. |
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(a) Form and Dating. The Dollar Notes and the Trustee’s (or the authenticating agent’s) certificate of authentication shall be substantially in the form of Exhibit A-1 hereto with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture. The Euro Notes and the Trustee’s (or the authenticating agent’s) certificate of authentication shall be substantially in the form of Exhibit A-2 hereto with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture. The Notes may have notations, legends or endorsements required by law, the rules of any securities exchange agreements to which the Issuers are subject, if any, or usage; provided that any such notation, legend or endorsement is in form reasonably acceptable to the Issuers. The Issuers shall approve the form of the Notes. Each Note shall be dated the date of its authentication. The terms and provisions contained in the form of the Notes shall constitute and are hereby expressly made a part of this Indenture. The Dollar Notes shall be issued only in registered form without coupons and only in minimum denominations of $200,000 in principal amount and any integral multiples of $1,000 in excess thereof. The Euro Notes shall be issued only in registered form without coupons and only in minimum denominations of €100,000 in principal amount and any integral multiples of €1,000 in excess thereof. |
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(b) Global Notes. Dollar Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-1 hereto, with such applicable legends as are provided in Exhibit A-1 hereto, except as otherwise permitted herein (the “Restricted Dollar Global Note”), which shall be deposited on behalf of the purchasers of the Dollar Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Dollar Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Dollar Global Note and recorded in the Security Register, as hereinafter provided. |
Dollar Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-1 hereto, with such applicable legends as are provided in Exhibit A-1 hereto, except as otherwise permitted herein (the “Regulation S Dollar Global Note”), which shall be deposited on behalf of the purchasers of the Dollar Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Regulation S Dollar Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Regulation S Dollar Global Note and recorded in the Security Register, as hereinafter provided.
Euro Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-2 hereto, with such applicable legends as are provided in Exhibit A-2 hereto, except as otherwise permitted herein (the “Restricted Euro Global Note” and, together with the Restricted Dollar Global Notes, the “Restricted Global Notes”), which shall be deposited on behalf of the purchasers of the Euro Notes represented thereby with the Common Depositary, and registered in the name of the Common Depositary or its nominee, as the case may be, for the accounts of Euroclear and Clearstream, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Euro Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Euro Global Note and recorded in the Security Register, as hereinafter provided.
Euro Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-2 hereto, with such applicable legends as are provided in Exhibit A-2 hereto, except as otherwise permitted herein (the “Regulation S Euro Global Note” and, together with the Regulation S Dollar Global Notes, the “Regulation S Global Notes”), which shall be deposited on behalf of the purchasers of the Euro Notes represented thereby with the Common Depositary, and registered in the name of the Common Depositary or its nominee, as the case may be, for the accounts of Euroclear and Clearstream, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Regulation S Euro Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Regulation S Euro Global Note and recorded in the Security Register, as hereinafter provided.
Members of, or participants and account holders in, DTC, Euroclear and Clearstream (“Participants”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by DTC, the Common Depositary or by the Trustee or any custodian of DTC, the Common
Depositary or under such Global Note, and DTC, the Common Depositary or their respective nominees may be treated by the Issuers, a Guarantor, the Trustee and any agent of the Issuers, a Guarantor or the Trustee as the sole owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, a Guarantor, the Trustee or any agent of the Issuers, a Guarantor or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or the Common Depositary or impair, as between DTC or the Common Depositary, on the one hand, and the Participants, on the other, the operation of customary practices of such persons governing the exercise of the rights of a Holder of a beneficial interest in any Global Note.
Subject to the provisions of Section 2.10(b), the registered Holder of a Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action that a Holder is entitled to take under this Indenture or the Notes.
Except as provided in Section 2.10, owners of a beneficial interest in Global Notes will not be entitled to receive physical delivery of certificated Notes.
If an authorized member of the Issuers’ boards of directors or an executive officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.
A Note shall not be valid or obligatory for any purpose until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Issuers shall execute and, upon receipt of an Issuers Order, the Trustee shall authenticate (whether itself or via the authenticating agent) (a) Original Dollar Notes, on the date hereof, for original issue up to an aggregate principal amount of $500,000,000, (b) Original Euro Notes, on the date hereof, for original issue up to an aggregate principal amount of €440,000,000 and (c) Additional Notes, from time to time, subject to compliance at the time of issuance of such Additional Notes with the provisions of Section 4.06. The Issuers are permitted to issue Additional Notes as part of a further issue under this Indenture, from time to time; provided that, if the Additional Euro Notes are not fungible with any series of Original Euro Notes for U.S. federal income tax purposes or any Additional Dollar Notes are not fungible with any series of Original Dollar Notes, respectively, such Additional Notes will have a separate CUSIP number and/or ISIN, if applicable.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuers to authenticate the Notes. Unless limited by the terms of such appointment, any such authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by any such agent. An authenticating agent has the same rights as any Registrar, co-Registrar, Transfer Agent or Paying Agent to deal with the Issuers or an Affiliate of the Issuers.
The Trustee shall have the right to decline to authenticate and deliver any Notes under this Section 2.02 if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability to existing Holders.
With respect to the Dollar Notes, the Issuers shall maintain a Principal Paying Agent in London. With respect to the Euro Notes, the Issuers shall maintain a Transfer Agent and Principal Paying Agent in London, United Kingdom. Either Issuer or any of their respective Affiliates may act as Transfer Agent, Registrar, co-Registrar, Paying Agent and agent for service of notices and demands in connection with the Notes; provided that neither Issuer nor any of their respective Affiliates shall act as Paying Agent for the purposes of Articles Three and Eight and Sections 4.09 and 4.11.
The Issuers hereby appoint Citibank, N.A., London Branch located at 25 Canada Square, London E14 5LB, United Kingdom as Transfer Agent, as Principal Paying Agent (the “Principal Paying Agent”) in London, United Kingdom, and as agent for service of notices and demands in connection with the Notes and Citigroup Global Markets Europe AG, at 5th Floor Reuterweg 16, 60323 Frankfurt, Germany, as Registrar. Each hereby accepts such appointments. The Transfer Agent, the Principal Paying Agent and the Registrar and any authenticating agent are collectively referred to in this Indenture as the “Agents”. The roles, duties and functions of the Agents are of a mechanical nature and each Agent shall only perform those acts and duties as specifically set out in this Indenture and no other acts, covenants, obligations or duties shall be implied or read into this Indenture against any of the Agents. For the avoidance of doubt, a Paying Agent’s obligation to disburse any funds shall be subject to prior receipt by it of those funds to be disbursed.
Subject to any applicable laws and regulations, the Issuers shall cause the Registrar to keep a register (the “Security Register”) at its corporate trust office in which, subject to such reasonable regulations it may prescribe, the Issuers shall provide for the registration of ownership, exchange, and transfer of the Notes. Such registration in the Security Register shall be conclusive evidence of the ownership of Notes. Included in the books and records for the Notes shall be notations as to whether such Notes have been paid, exchanged or transferred, canceled, lost, stolen, mutilated or destroyed and whether such Notes have been replaced. In the case of the replacement of any of the Notes, the Registrar shall keep a record of the Note so replaced and the Note issued in replacement thereof. In the case of the cancellation of any of the Notes, the Registrar shall keep a record of the Note so canceled and the date on which such Note was canceled.
The Issuers shall enter into an appropriate agency agreement with any Paying Agent or co-Registrar not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuers shall notify the Trustee of the name and address of any such agent. If the Issuers fail to maintain a Registrar or Paying Agent, the Trustee may appoint a suitably qualified and reputable party to act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.05.
shall remit such money to the Holders on the relevant due date for payment, unless such remittance is impracticable having regard to applicable banking procedures and timing constraints, in which case the Principal Paying Agent shall remit such money to the Holders on the next Business Day, but without liability for any interest resulting from such late payment. For the avoidance of doubt, the Principal Paying Agent shall only be obliged to remit money to Holders if it has actually received such money from the Issuers. The Issuers shall require each Paying Agent other than the Trustee (including where acting as the Principal Paying Agent) to agree in writing that such Paying Agent shall hold for the benefit of the Trustee all money held by the Paying Agent for the payment of principal of, premium, if any, and interest on the Notes (whether such money has been paid to it by the Issuers or any other obligor on the Notes), and such Paying Agent shall promptly notify the Trustee of any default by the Issuers (or any other obligor on the Notes) in making any such payment. The Issuers at any time may require a Paying Agent to pay all money held by it to the Trustee and account for any funds disbursed, and the Trustee may at any time during the continuance of any payment default, upon written request to a Paying Agent, require such Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed. Upon doing so, the Paying Agent shall have no further liability for the money so paid over to the Trustee. If the Issuers or any Affiliate of the Issuers acts as Paying Agent, it shall, on or before each due date of any principal, premium, if any, or interest on the Notes, segregate and hold in a separate trust fund for the benefit of the Holders a sum of money sufficient to pay such principal, premium, if any, or interest so becoming due until such sum of money shall be paid to such Holders or otherwise disposed of as provided in this Indenture, and shall promptly notify the Trustee of its action or failure to act. |
The Trustee may, if the Issuers have notified it in writing that the Issuers intend to effect a defeasance or to satisfy and discharge this Indenture in accordance with the provisions of Article Eight, notify the Paying Agent in writing of this fact and require the Paying Agent (until notified by the Trustee to the contrary), to act thereafter as Paying Agent of the Trustee and not the Issuers in relation to any amounts deposited with it in accordance with the provisions of Article Eight.
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(a) Where Notes are presented to the Registrar or a co-Registrar with a request to register a transfer or to exchange them for an equal principal amount of Notes of other denominations, the Registrar shall register the transfer or make the exchange in accordance with the requirements of this Section 2.06. To permit registration of transfers and exchanges, the Issuers shall execute and the Trustee (or the authenticating agent) shall, upon receipt of an Issuers Order, authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes, of any authorized denominations and of a like aggregate principal amount, at the Registrar’s request, provided that no Note of less than $200,000 (in the case of Dollar Notes) or €100,000 (in the case of Euro Notes) may be transferred or exchanged. No service charge shall be made for any registration of transfer or exchange of Notes (except as otherwise expressly permitted herein), but the Issuers may require payment of a sum sufficient to cover any agency fee or similar charge payable in connection with any such registration of transfer or exchange of Notes (other than any agency fee or similar charge payable in connection with any redemption of the Notes or upon exchanges pursuant to Sections 2.10, 3.08 or 9.05) or in accordance with an Excess Proceeds Offer pursuant to Section 4.09 or Change of Control Offer pursuant to Section 4.11, not involving a transfer. |
Upon presentation for exchange or transfer of any Note as permitted by the terms of this Indenture and by any legend appearing on such Note, such Note shall be exchanged or transferred upon the Security Register and one or more new Notes shall be authenticated and issued in the name of the Holder (in the case of exchanges only) or the transferee, as the case may be. No exchange or transfer of a Note shall be effective under this Indenture unless and until such Note has been registered in the name of such Person in the Security Register. Furthermore, the exchange or transfer of any Note shall not be effective under this Indenture unless the request for such exchange or transfer is made by the Holder or by a duly authorized attorney-in-fact at the office of the Registrar.
Every Note presented or surrendered for registration of transfer or for exchange shall (if so required by the Issuers or the Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Issuers and the Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.
All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuers evidencing the same indebtedness, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.
Neither the Issuers nor the Trustee, Registrar or any Paying Agent shall be required (i) to issue, register the transfer of, or exchange any Note during a period beginning at the opening of 15 Business Days before the day of the mailing of a notice of redemption of Notes selected for redemption under Section 3.02 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.
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(b) Notwithstanding any provision to the contrary herein, so long as a Global Note remains outstanding and is held by or on behalf of DTC or the Common Depositary, transfers of a Global Note, in whole or in part, or of any beneficial interest therein, shall only be made in accordance with Section 2.01(c), Section 2.06(a) and this Section 2.06(b); provided, that a beneficial interest in a Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Global Note in accordance with the transfer restrictions set forth in the restricted Note legend on the Note, if any. |
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(i) Except for transfers or exchanges made in accordance with any of clauses (ii) through (v) of this Section 2.06(b), transfers of a Global Note shall be limited to transfers of such Global Note in whole, but not in part, to nominees of DTC or the Common Depositary or to a successor of DTC or the Common Depositary or such successor’s nominee. |
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(ii) Restricted Dollar Global Note to Regulation S Dollar Global Note. If the holder of a beneficial interest in the Restricted Dollar Global Note at any time wishes to exchange its interest in such Restricted Dollar Global Note for an interest in the Regulation S Dollar Global Note, or to transfer its interest in such Restricted Dollar Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Dollar Global Note, such transfer or exchange may be effected, only in accordance with this clause (ii) and the rules and procedures of DTC, Euroclear and Clearstream, in each case to the extent applicable (the “Applicable Procedures”). Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Dollar Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Dollar Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted |
Dollar Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Dollar Global Note and shall cause the Common Depositary to increase or cause to be increased the principal amount of the Regulation S Dollar Global Note by the aggregate principal amount of the interest in the Restricted Dollar Global Note to be exchanged or transferred. |
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(iii) Regulation S Dollar Global Note to Restricted Dollar Global Note. If the holder of a beneficial interest in the Regulation S Dollar Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Dollar Global Note, such transfer may be effected only in accordance with this clause (iii) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Dollar Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Dollar Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuers or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Dollar Global Note and to increase or cause to be increased the principal amount of the Restricted Dollar Global Note by the aggregate principal amount of the interest in such Regulation S Dollar Global Note to be exchanged or transferred. |
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(iv) Restricted Euro Global Note to Regulation S Euro Global Note. If the holder of a beneficial interest in the Restricted Euro Global Note at any time wishes to exchange its interest in such Restricted Euro Global Note for an interest in the Regulation S Euro Global Note, or to transfer its interest in such Restricted Euro Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Euro Global Note, such transfer or exchange may be effected, only in accordance with this clause (iv) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Euro Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Euro Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted Euro Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Euro Global Note and shall cause the Common Depositary to increase or cause to be increased the principal amount of the Regulation S Euro Global Note by the aggregate principal amount of the interest in the Restricted Euro Global Note to be exchanged or transferred. |
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(v) Regulation S Euro Global Note to Restricted Euro Global Note. If the holder of a beneficial interest in the Regulation S Euro Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Euro Global Note, such transfer may be effected only in accordance with this clause (v) and the |
Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Euro Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Euro Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuers or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Euro Global Note and to increase or cause to be increased the principal amount of the Restricted Euro Global Note by the aggregate principal amount of the interest in the Regulation S Euro Global Note to be exchanged or transferred. |
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(c) If Notes are issued upon the transfer, exchange or replacement of Notes bearing the restricted Notes legends set forth in Exhibit A-1 or Exhibit A-2 hereto, as applicable, the Notes so issued shall bear the restricted Notes legends, and a request to remove such restricted Notes legends from Notes shall not be honored unless there is delivered to the Issuers such satisfactory evidence, which may include an Opinion of Counsel licensed to practice law in the State of New York, as may be reasonably required by the Issuers, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A or Rule 144 under the Securities Act. Upon provision of such satisfactory evidence, the Trustee, at the direction of the Issuers, shall (or shall direct the authenticating agent to) authenticate and deliver Notes that do not bear the legend. |
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(d) The Trustee and the Agents shall have no responsibility for any actions taken or not taken by DTC, Euroclear or Clearstream, as the case may be. |
In the event any such mutilated, lost, destroyed or wrongfully taken Note has become or is about to become due and payable, the Issuers in its discretion may pay such Note instead of issuing a new Note in replacement thereof.
Every replacement Note shall be an additional obligation of the Issuers.
The provisions of this Section 2.07 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or wrongfully taken Notes.
If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory to them that the Note that has been replaced is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal, interest and Additional Amounts, if any, payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
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(a) A Global Note deposited with the Common Depositary or a custodian for DTC, as the case may be, pursuant to Section 2.01 shall be transferred in whole to the beneficial owners thereof in the form of certificated Notes only if such transfer complies with Section 2.06 and (i) DTC, Euroclear or Clearstream, as applicable, notifies the Issuers that it is unwilling or unable to continue to act as depositary and a successor depositary is not appointed by the Issuers within 120 days of such notice, or (ii) the owner of a Book-Entry Interest requests such an exchange in writing delivered through DTC, Euroclear or Clearstream following an Event of Default under this Indenture. Notice of any such transfer shall be given by the Issuers in accordance with the provisions of Section 12.02(a). |
premium, if any, and interest on the certificated Notes will be payable, and the transfer of the certificated Notes will be registrable, at the office or agency of the Issuers maintained for such purposes in accordance with Section 2.03. Such certificated Notes shall bear the applicable legends set forth in Exhibit A-1 or Exhibit A-2 hereto, as applicable. |
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(c) In the event of the occurrence of any of the events specified in Section 2.10(a), the Issuers shall promptly make available to the Trustee and the authenticating agent a reasonable supply of certificated Notes in definitive, fully registered form without interest coupons. |
The Issuers may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes are registered at the close of business on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Issuers shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment, and at the same time the Issuers may deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest; or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause. In addition, the Issuers shall fix a special record date for the payment of such Defaulted Interest, such date to be not more than 15 days and not less than 10 days prior to the proposed payment date and not less than 15 days after the receipt by the Trustee of the notice of the proposed payment date. The Issuers shall promptly but, in any event, not less than 15 days prior to the special record date, notify the Trustee of such special record date and, in the name and at the expense of the Issuers, the Trustee shall cause notice of the proposed payment date of such Defaulted Interest and the special record date therefor to be mailed first-class, postage prepaid to each Holder as such Holder’s address appears in the Security Register, not less than 10 days prior to such special record date. Notice of the proposed payment date of such Defaulted Interest and the special record date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes are registered at the close of business on such special record date and shall no longer be payable pursuant to Section 2.12(b).
The Issuers may make payment of any Defaulted Interest on the Notes in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Issuers to the Trustee of the proposed payment date pursuant to this clause, such manner of payment shall be deemed reasonably practicable.
Subject to the foregoing provisions of this Section 2.12, each Note delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.
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SECTION 2.13. Computation of Interest. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. |
The Issuers shall give each notice to the Trustee provided for in this Section 3.02 in writing at least 10 days before the date notice is mailed to the Holders pursuant to Section 3.04 unless the Trustee consents to a shorter period. Such notice shall be accompanied by an Officer’s Certificate from the Issuers to the effect that such redemption will comply with the conditions herein. If fewer than all the Notes are to be redeemed, the record date relating to such redemption shall be selected by the Issuers and given to the Trustee.
Note not redeemed to less than $200,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Euro Note not redeemed to less than €100,000. |
The Trustee or the Registrar shall make the selection from the Notes outstanding and not previously called for redemption. The Trustee or the Registrar may select for redemption portions equal to (i) with respect to Dollar Notes, $1,000 in principal amount and any integral multiple thereof and (ii) with respect to Euro Notes, €1,000 in principal amount and any integral multiple thereof; provided that no Euro Notes of €100,000 in principal amount or less and no Dollar Notes of $200,000 in principal amount or less may be redeemed in part. Provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee or the Registrar, as applicable, shall notify the Issuers promptly in writing of the Notes or portions of Notes to be called for redemption.
Neither the Trustee nor the Registrar shall be liable for selections made in accordance with the provisions of this Section 3.03.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such redemption or notice shall state that in the Issuers’ discretion, the Redemption Date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the Redemption Date or by the Redemption Date so delayed.
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(a) At least 10 days but not more than 60 days before a date for redemption of the Euro Notes and/or Dollar Notes, as the case may be, the Issuers shall mail a notice of redemption by first-class mail to each Holder to be redeemed and shall comply with the provisions of Section 12.02(b). |
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(b) The notice shall identify the Notes to be redeemed (including ISIN, CUSIP and Common Code numbers, as applicable) and shall state: |
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(i) the Redemption Date and the record date; |
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(ii) the appropriate calculation of the Redemption Price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid; |
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(iii) the name and address of the Paying Agent; |
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(iv) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any, and Additional Amounts, if any; |
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(v) that, if any Note is being redeemed in part, the portion of the principal amount (equal to (x) $1,000 in principal amount or any integral multiple thereof with respect to Dollar Notes and (y) €1,000 in principal amount or any integral multiple thereof with respect to Euro Notes) of such Note to be redeemed and that, on and after the Redemption Date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be reissued; |
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(vi) that, if any Note contains an ISIN, CUSIP or Common Code number, no representation is being made as to the correctness of such ISIN, CUSIP or Common Code number |
either as printed on the Notes or as contained in the notice of redemption and that reliance may be placed only on the other identification numbers printed on the Notes; |
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(vii) that, unless the Issuers and the Guarantors default in making such redemption payment, interest on the Notes (or portion thereof) called for redemption shall cease to accrue on and after the Redemption Date; |
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(viii) the paragraph of the Notes pursuant to which the Notes called for redemption are being redeemed; and |
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(ix) whether the redemption is conditioned on any events and, if so, the notice shall specify such events. |
At the Issuers’ written request, the Trustee shall give a notice of redemption in the Issuers’ name and at the Issuers’ expense. In such event, the Issuers shall provide the Trustee with the notice and the other information required by this Section 3.04.
Notice of redemption shall be deemed to be given when mailed, whether or not the Holder receives the notice. In any event, failure to give such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of Notes held by Holders to whom such notice was properly given.
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(a) Upon surrender of a Global Note that is redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on the Security Register to reduce the principal amount of such Global Note to an amount equal to the unredeemed portion of the Global Note surrendered; provided that each such Global Note shall be in a principal amount at final Stated Maturity of (i) in the case |
of Dollar Notes, $200,000 or an integral multiple of $1,000 in excess thereof, and (ii) in the case of Euro Notes, €100,000 or an integral multiple of €1,000 in excess thereof. |
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(b) Upon surrender and cancellation of a certificated Note that is redeemed in part, the Issuers shall execute and the Trustee shall authenticate for the Holder (at the Issuers’ expense) a new Note equal in principal amount to the unredeemed portion of the Note surrendered and canceled; provided that each such certificated Note shall be in a principal amount at final Stated Maturity of (i) in the case of Dollar Notes, $200,000 or an integral multiple of $1,000 in excess thereof, and (ii) in the case of Euro Notes, €100,000 or an integral multiple of €1,000 in excess thereof. |
The Issuers or the Guarantors shall pay interest on overdue principal at the rate specified therefor in the Notes. The Issuers or the Guarantors shall pay interest on overdue installments of interest at the same rate to the extent lawful.
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(a) The Parent Guarantor shall deliver to the Trustee, within 120 days after the end of each fiscal year or within 14 days of written request by the Trustee, an Officer’s Certificate stating that in the course of the performance by the signer of its duties as an officer of the Parent Guarantor he would normally have knowledge of any Default and whether or not the signer knows of any Default that occurred during such period and if any specifying such Default, its status and what action the Parent Guarantor is taking or proposed to take with respect thereto. For purposes of this Section 4.05(a), such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. |
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(b) If the Parent Guarantor or the Issuers shall become aware that (i) any Default or Event of Default has occurred and is continuing or (ii) any Holder seeks to exercise any remedy hereunder with respect to a claimed Default under this Indenture or the Notes, the Parent Guarantor or the Issuers, as the case may be, shall immediately deliver to the Trustee an Officer’s Certificate specifying such event, notice or other action (including any action the Parent Guarantor or the Issuers are taking or propose to take in respect thereof). |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, create, issue, incur, assume, guarantee or in any manner become directly or indirectly liable with respect to or otherwise become responsible for, contingently or otherwise, the payment of (individually and collectively, to “incur” or, as appropriate, an “incurrence”), any Debt (including any Acquired Debt); provided that the Parent Guarantor, each Issuer and any Restricted Subsidiary shall be permitted to incur Debt (including Acquired Debt) if in each case (i) after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, no Default or Event of Default would occur or be continuing and (ii) at the time of such incurrence and after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio for the four full fiscal quarters for which financial statements are available immediately preceding the incurrence of such Debt, taken as one period, would be greater than 2.0 to 1.0. |
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(b) Section 4.06(a) shall not, however, prohibit the following (collectively, “Permitted Debt”): |
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(i) the Notes and the New Unsecured Notes issued on the Issue Date; |
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(ii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Credit Facilities in an aggregate principal amount not to exceed the greater of (i) (x) at any time prior to the completion of the Disposition, $850,000,000 or (y) at any time after the completion of the Disposition, $700,000,000 and (ii) an amount equal to (I) 85.0% of Total Receivables plus 70.0% of Total Inventories less (II) $275,000,000; |
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(iii) any Existing Debt of the Parent Guarantor or any Restricted Subsidiary (other than Debt described in clauses (i) and (ii) of this Section 4.06(b)); |
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(iv) the incurrence by the Parent Guarantor or any Restricted Subsidiary of intercompany Debt between the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; provided that: |
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(A) if an Issuer or a Guarantor is the obligor on any such Debt, unless required by a Credit Facility and only to the extent legally permitted, such Debt must be unsecured (except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with cash management, cash pooling, tax and accounting operations of the Parent Guarantor and its Restricted Subsidiaries); and |
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(B) (x) any disposition, pledge or transfer of any such Debt to a Person (other than a disposition, pledge or transfer to the Parent Guarantor or a Restricted Subsidiary) and (y) any transaction pursuant to which any Restricted Subsidiary that has Debt owing by the Parent Guarantor or another Restricted Subsidiary ceases to be a Restricted Subsidiary, will, in each case, be deemed to be an incurrence of such Debt not permitted by this clause (iv); |
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(v) guarantees of the Parent Guarantor or any Restricted Subsidiary of Debt of the Parent Guarantor or any Restricted Subsidiary to the extent that the guaranteed Debt was permitted to be incurred by another provision of this Section 4.06; |
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(vi) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt represented by Capitalized Lease Obligations, mortgage financings, purchase money obligations or other Debt incurred or assumed in connection with the acquisition or development of real or personal, movable or immovable, property or assets, in each case, incurred for the purpose of financing or refinancing all or any part of the purchase price, lease expense or cost of construction or improvement of property, plant, equipment or other assets used in the Parent Guarantor’s or any Restricted Subsidiary’s business (including any reasonable related fees or expenses incurred in connection with such acquisition or development); provided that the principal amount of such Debt so incurred when aggregated with other Debt previously incurred in reliance on this clause (vi) and still outstanding shall not in the aggregate exceed the greater of $510,000,000 and 6.0% of Total Assets; and provided, further, that the total principal amount of any Debt incurred in connection with an acquisition or development permitted under this clause (vi) did not in each case at the time of incurrence exceed (A) the Fair Market Value of the acquired or constructed asset or improvement so financed or (B) in the case of an uncompleted constructed asset, the amount of the asset to be constructed, as determined on the date the contract for construction of such asset was entered into by the Parent Guarantor or the relevant Restricted Subsidiary (including, in each case, any reasonable related fees and expenses incurred in connection with such acquisition, construction or development); |
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(vii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt arising from agreements providing for guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock (other than guarantees or similar credit support given by the Parent Guarantor or any Restricted Subsidiary of Debt incurred by any Person acquiring all or any portion of such assets for the purpose of financing such acquisition); provided that the maximum aggregate liability in respect of all such Debt permitted pursuant to this clause (vii) shall at no time exceed the net proceeds, including non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received from the sale of such assets; |
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(viii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Commodity Hedging Agreements not for speculative purposes; |
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(ix) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Currency Agreements not for speculative purposes; |
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(x) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Interest Rate Agreements not for speculative purposes; |
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(xi) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of workers’ compensation and claims arising under similar legislation, or pursuant to self-insurance obligations and not in connection with the borrowing of money or the obtaining of advances or credit; |
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(xii) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary arising from (A) the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Debt is extinguished within five Business Days of incurrence, (B) bankers’ acceptances, performance, surety, judgment, completion, payment, appeal or similar bonds, instruments or obligations, (C) completion guarantees, advance payment, customs, VAT or other tax guarantees or similar instruments provided or letters of credit obtained by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business, and (D) the financing of insurance premiums in the ordinary course of business; |
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(xiii) any Debt of the Parent Guarantor or any Restricted Subsidiary incurred pursuant to any Permitted Receivables Financing; |
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(xiv) the incurrence by a Person of Permitted Refinancing Debt in exchange for or the net proceeds of which are used to refund, replace or refinance Debt incurred by it pursuant to, or described in, Section 4.06(a), sub clauses (i) and (iii), this sub-clause (xiv) and sub-clauses (xviii), (xix) and (xx) of this Section 4.06(b), as the case may be; |
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(xv) guarantees by the Parent Guarantor or a Restricted Subsidiary of Debt incurred by Permitted Joint Ventures in an aggregate principal amount at any one time outstanding not to exceed an amount equal to the greater of $150,000,000 and 2.0% of Total Assets; |
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(xvi) cash management obligations and Debt in respect of netting services, pooling arrangements or similar arrangements in connection with cash management in the ordinary course of business consistent with past practice; |
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(xvii) (i) take-or-pay obligations in the ordinary course of business, (ii) customer deposits and advance payments in the ordinary course of business received from customers for goods or services purchased in the ordinary course of business and (iii) manufacturer, vendor financing, customer and supply arrangements in the ordinary course of business; |
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(xviii) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary (other than and in addition to Debt permitted under clauses (i) through (xvii) above and clauses (xix) and (xx) below) in an aggregate principal amount at any one time outstanding not to exceed, together with any Permitted Refinancing Debt in respect thereof, the greater of $350,000,000 and 5.0% of Total Assets; |
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(xix) Debt of any Person (x) incurred and outstanding on the date on which such Person becomes a Restricted Subsidiary of the Parent Guarantor or another Restricted Subsidiary of the Parent Guarantor or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Parent Guarantor or any Restricted Subsidiary or (y) incurred to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary; provided, however, with respect to each of sub-clause (x) and (y) of this Section 4.06(b)(xix), that at the time of such acquisition or other transaction (1) the Parent Guarantor would have been able to incur $1.00 of additional Debt pursuant to Section 4.06(a) after giving effect to the incurrence of such Debt pursuant to this Section 4.06(b)(xix) or (2) the Fixed Charge Coverage Ratio of the Parent Guarantor and its Restricted Subsidiaries would not be less than it was immediately prior to giving pro forma effect to such acquisition or other transaction; |
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(xx) Contribution Debt; and |
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(xxi) Debt consisting of local lines of credit, overdraft facilities or local working capital facilities in an aggregate outstanding principal amount at any one time not to exceed the greater of $75,000,000 and 1.0% of Total Assets. |
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(c) Accrual of interest or dividends, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest or dividends in the form of additional Debt of the same class will not be deemed to be an incurrence of Debt for purposes of this Section 4.06. |
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(d) For purposes of determining compliance with any restriction on the incurrence of Debt in U.S. dollar where Debt is denominated in a different currency, the amount of such Debt will be the Dollar Equivalent determined on the date of such determination; provided that if any such Debt denominated in a different currency is subject to a Currency Agreement (with respect to U.S. dollars) covering principal amounts payable on such Debt, the amount of such Debt expressed in U.S. dollars shall be adjusted to take into account the effect of such agreement. The principal amount of any Permitted Refinancing Debt incurred in the same currency as the Debt being refinanced shall be the Dollar Equivalent of the Debt refinanced determined on the date such Debt being refinanced was initially incurred. Notwithstanding any other provision of this Section 4.06, for purposes of determining compliance with this Section 4.06, increases in Debt solely due to fluctuations in the exchange rates of currencies will not be deemed to exceed the maximum amount that an Issuer, the Parent Guarantor or a Subsidiary Guarantor may incur under this Section 4.06. |
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(e) For purposes of determining any particular amount of Debt under this Section 4.06: |
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(i) obligations with respect to letters of credit, guarantees or Liens, in each case supporting Debt otherwise included in the determination of such particular amount shall not be included; |
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(ii) any Liens granted pursuant to the equal and ratable provisions referred to in Section 4.07 shall not be treated as Debt; |
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(iii) accrual of interest, accrual of dividends, the accretion of accreted value, the obligation to pay commitment fees and the payment of interest in the form of additional preferred stock or Debt shall not be treated as Debt; and |
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(iv) the reclassification of preferred stock as Debt due to a change in accounting principles shall not be treated as Debt. |
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(f) In the event that an item of Debt meets the criteria of more than one of the types of Debt described in this Section 4.06, the Parent Guarantor, in its sole discretion, shall classify items of Debt and shall only be required to include the amount and type of such Debt in one of such clauses and the Parent Guarantor shall be entitled to divide and classify an item of Debt in more than one of the types of Debt described in this Section 4.06, and may change the classification of an item of Debt (or any portion thereof) to any other type of Debt described in this Section 4.06 at any time. |
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(g) The amount of any Debt outstanding as of any date will be: |
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(i) in the case of any Debt issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS; |
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(ii) the principal amount of the Debt, in the case of any other Debt; and |
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(iii) in respect of Debt of another Person secured by a Lien on the assets of the specified Person, the lesser of: |
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(A) the Fair Market Value of such assets at the date of determination; and |
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(B) the amount of the Debt of the other Person. |
The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind securing any Debt (except for Permitted Liens) or assign or otherwise convey any right to receive any income, profits or proceeds on or with respect to any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets, including any shares of stock or any Debt of any Restricted Subsidiary but excluding any Capital Stock, Debt or other securities of any Unrestricted Subsidiary, whether owned at or acquired after the Issue Date, or any income, profits or proceeds therefrom unless:
in the case of any Lien securing Subordinated Debt, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Subordinated Debt of a Guarantor) are directly secured by a Lien on such property, assets or proceeds that is senior in priority to the Lien securing the Subordinated Debt until such time as the Subordinated Debt is no longer secured by a Lien; and
in the case of any other Lien, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Debt of a Guarantor), and all other amounts due under this Indenture are equally and ratably secured with the obligation or liability secured by such Lien.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, take any of the following actions (each of which is a “Restricted Payment” and which are collectively referred to as “Restricted Payments”): |
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(i) declare or pay any dividend on or make any distribution (whether made in cash, securities or other property) with respect to any of the Parent Guarantor’s or any Restricted Subsidiary’s Capital Stock (including, without limitation, any payment in connection with any merger or consolidation involving the Parent Guarantor or any Restricted Subsidiary) (other than (A) to the Parent Guarantor or any Restricted Subsidiary or (B) to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Parent Guarantor or a Restricted Subsidiary of dividends or distributions of greater value than the Parent Guarantor or such Restricted Subsidiary would receive on a pro rata basis; provided that any amount so paid or distributed to holders of Capital Stock of a Restricted Subsidiary other than the Parent Guarantor or a Restricted Subsidiary shall be included in the calculation of the aggregate amount of all Restricted Payments declared or made after July 1, 2014 for the purposes of Section 4.08(b)), except for dividends or distributions payable solely in shares of the Parent Guarantor’s Qualified Capital Stock or in options, warrants or other rights to acquire such shares of Qualified Capital Stock, or make any payment of cash interest on Deeply Subordinated Funding; |
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(ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation), directly or indirectly, any shares of the Parent Guarantor’s Capital Stock held by persons other than the Parent Guarantor or a Restricted Subsidiary (other than Capital Stock of any Restricted Subsidiary or any entity that becomes a Restricted Subsidiary as a result thereof) or any options, warrants or other rights to acquire such shares of Capital Stock; |
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(iii) make any principal payment on, or repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled principal payment, sinking fund payment or maturity, any Subordinated Debt or any Deeply Subordinated Funding; or |
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(iv) make any Investment (other than any Permitted Investment) in any Person. |
If any Restricted Payment described in this Section 4.08(a) is not made in cash, the amount of the proposed Restricted Payment shall be the Fair Market Value of the asset to be transferred as of the date of transfer.
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(b) Notwithstanding Section 4.08(a), the Parent Guarantor or any Restricted Subsidiary may make a Restricted Payment if, at the time of and after giving pro forma effect to such proposed Restricted Payment: |
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(i) no Default or Event of Default has occurred and is continuing; |
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(ii) the Parent Guarantor could incur at least $1.00 of additional Debt (other than Permitted Debt) pursuant to Section 4.06; and |
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(iii) the aggregate amount of all Restricted Payments declared or made after July 1, 2014 does not exceed the sum of: |
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(A) 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during the period beginning on July 1, 2014 and ending on the last day of the Parent Guarantor’s last fiscal quarter ending prior to the date of such proposed Restricted Payment (or, if such aggregate cumulative Consolidated Adjusted Net Income shall be a negative number, minus 100% of such negative amount),; plus |
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(B) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received by the Parent Guarantor as a contribution to its common equity capital after the Issue Date or from the issuance or sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (including upon the exercise of options, warrants or rights) or warrants, options or rights to purchase shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (except, in each case to the extent such proceeds are used to purchase, redeem or otherwise retire Capital Stock or Subordinated Debt or Deeply Subordinated Funding as set forth in sub-clause (ii) or (iii) of Section 4.08(c) or constitute an Excluded Contribution or the proceeds of any Contribution Debt) (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid and Excluded Contributions); plus |
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(C) (x) the amount by which the Parent Guarantor’s Debt or Debt of any Restricted Subsidiary is reduced after the Issue Date upon the conversion or exchange (other than by the Parent Guarantor or its Subsidiary) of such Debt into the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, and (y) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received after the Issue Date by the Parent Guarantor from the issuance or sale (other than to any Subsidiary) of Redeemable Capital Stock that has been converted into or exchanged for the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, to the extent such Redeemable Capital Stock was originally sold for cash or Cash Equivalents, together with, in the case of both sub-clauses (x) and (y) of this Section 4.08(b)(iii)(C), the aggregate Net Cash Proceeds received by the Parent Guarantor at the time of such conversion or exchange (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid); plus |
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(D) (x) in the case of the disposition or repayment of any Investment constituting a Restricted Payment made after the Issue Date, an amount (to the extent not included in Consolidated Adjusted Net Income) equal to the cash proceeds of such disposition or repayment or the Fair Market Value of property received by the Parent Guarantor or a Restricted Subsidiary thereof, in either case, less the cost of the disposition of such Investment and net of taxes, and (y) in the case of the designation of an Unrestricted Subsidiary as a Restricted Subsidiary (as long as the designation of such Subsidiary as an Unrestricted Subsidiary was deemed a Restricted Payment), the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary; provided that such amount shall not in any case exceed the amount of the Restricted Payment deemed made at the time that the Subsidiary was designated as an Unrestricted Subsidiary, plus |
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(E) $80,000,000. |
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(c) Notwithstanding clauses (a) and (b) of this Section 4.08, the Parent Guarantor and any Restricted Subsidiary may take the following actions (“Permitted Payments”) so long as (with respect to sub-clauses (viii), (xi), (xii) and (xvii) of this clause (c)) no Default or Event of Default has occurred and is continuing: |
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(i) the payment of any dividend within 180 days after the date of its declaration if at such date of its declaration such payment would have been permitted by this Section 4.08; |
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(ii) the repurchase, redemption or other acquisition or retirement for value of any shares of the Parent Guarantor’s Capital Stock or options, warrants or other rights to acquire such Capital Stock in exchange for (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares or scrip), or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock, options, warrants or other rights to acquire such Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iii) the repurchase, redemption, defeasance or other acquisition or retirement for value or payment of principal of any Subordinated Debt or Deeply Subordinated Funding in exchange for, or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iv) the purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Debt (other than Redeemable Capital Stock) in exchange for, or out of the Net Cash Proceeds of a substantially concurrent incurrence (other than to a Subsidiary) of, Permitted Refinancing Debt; |
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(v) the repurchase of Capital Stock deemed to occur upon the exercise of stock options with respect to which payment of the cash exercise price has been forgiven if the cumulative aggregate value of such deemed repurchases does not exceed the cumulative aggregate amount of the exercise price of such options received; |
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(vi) payments or distributions to dissenting shareholders pursuant to applicable law in connection with or in contemplation of a merger, consolidation or transfer of assets that complies with the provisions of Article Five; |
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(vii) cash payments in lieu of issuing fractional shares pursuant to the exchange or conversion of any exchangeable or convertible securities; |
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(viii) cash payments, advances, loans or expense reimbursements made to any parent company of the Parent Guarantor to permit any such company to pay (i) general operating expenses, customary directors’ fees, accounting, legal, corporate reporting and administrative expenses incurred in the ordinary course of business in an amount not to exceed $25,000,000 in the aggregate in any fiscal year, and (ii) any taxes, duties or similar governmental fees of any such parent company to the extent such tax obligations are directly attributable to its ownership of the Parent Guarantor and its Restricted Subsidiaries; |
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(ix) any payments (including pursuant to a tax sharing agreement or similar arrangement) between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries files a consolidated tax return or with which the Parent Guarantor or any of its Restricted Subsidiaries is part of a group for tax purposes (including a fiscal unity) or any tax advantageous group contribution made pursuant to applicable legislation; provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand-alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(x) the repurchase, redemption or other acquisition or retirement, and any loans, advances, dividends or distributions by the Parent Guarantor to any direct or indirect parent company to repurchase, redeem or otherwise acquire or retire, for value of any Capital Stock of the Parent Guarantor or any Restricted Subsidiary or any direct or indirect parent company held by any current or former officer, director, employee or consultant of the Parent Guarantor or any of its Restricted Subsidiaries; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Capital Stock may not exceed $10,000,000 plus an amount equal to $10,000,000 multiplied by the number of years that have elapsed since the Issue Date; provided, further, that such amount in any calendar year may be increased by an amount not to exceed (A) the cash proceeds from the sale of Capital Stock of the Parent Guarantor or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Parent Guarantor, any of its Restricted Subsidiaries or any of its direct or indirect parent companies and (B) the cash proceeds of key man life insurance policies of the Parent Guarantor or a Restricted Subsidiary received by the Parent Guarantor or a Restricted Subsidiary after the Issue Date less any amount previously applied to the making of Restricted Payments pursuant to this clause (x), in each case, to the extent the cash proceeds have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.08(b)(iii)(B) or Section 4.08(c)(iii); |
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(xi) the declaration and payment by the Parent Guarantor of, or loans, advances, dividends or distributions to any parent company of the Parent Guarantor to pay, dividends on the common stock or common equity interests of the Parent Guarantor or any parent company following a Public Equity Offering, in an amount not to exceed in any fiscal year, 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during such fiscal year (the “Relevant Fiscal Year”); provided that such dividends shall be declared and paid no later than 180 days after the end of the Relevant Fiscal Year; |
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(xii) any other Restricted Payment; provided that the Consolidated Leverage Ratio of the Parent Guarantor on a pro forma basis after giving effect to any such Restricted Payment made pursuant to this clause (xii) but not including any Restricted Payment made in reliance on Section 4.08(b) or another clause of Section 4.08(c) (other than this sub-clause (xii)) does not exceed 5.25 to 1.0. |
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(xiii) Restricted Payments in an amount equal to the amount of Excluded Contributions made; |
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(xiv) the payment, purchase, redemption, defeasance or other acquisition or retirement for value of any Subordinated Debt of the Parent Guarantor and its Restricted Subsidiaries pursuant to Section 4.09 and Section 4.11; provided that, prior to such payment, purchase, redemption, defeasance or other acquisition or retirement for value, the Issuers or the Parent Guarantor has made a Change of Control Offer or Asset Sale Offer, as the case may be, with respect to Notes as a result of such Change of Control or Asset Sale, as the case may be, and has repurchased all such Notes |
validly tendered and not withdrawn in connection with such Change of Control Offer or Asset Sale Offer, as the case may be; |
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(xv) the declaration and payment of dividends to holders of any class or series of Redeemable Capital Stock incurred in accordance with Section 4.06; |
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(xvi) dividends or other distributions of Capital Stock of Unrestricted Subsidiaries; and |
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(xvii) any other Restricted Payment; provided that the total aggregate amount of Restricted Payments made under this clause (xvii) does not exceed the greater of $150,000,000 and 2.0% of Total Assets; and |
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(xviii) any Restricted Payment made in connection with the Transactions (including, for the avoidance of doubt, any payments contemplated by the Transaction Agreement), and any costs and expenses (including all legal, accounting and other professional fees and expenses) related thereto or used to fund amounts owed to Affiliates in connection with the Transactions (including dividends to any parent entity to permit payment by such parent entity of such amounts). |
The actions described in sub-clauses (i), (vi), (xi) and (xvii) of Section 4.08(c) are Restricted Payments that will be permitted to be made in accordance with this Section 4.08(c) but that reduce the amount that would otherwise be available for Restricted Payments under Section 4.08(b)(iii).
For purposes of determining compliance with this Section 4.08, in the event that a Restricted Payment meets the criteria of more than one of the categories described in sub-clauses (i) through (xviii) of Section 4.08(c), or is permitted pursuant to Section 4.08(a), the Parent Guarantor and its Restricted Subsidiaries will be entitled to classify such Restricted Payment (or portion thereof) on the date of its payment or later reclassify such Restricted Payment (or portion thereof) in any manner that complies with this Section 4.08. The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Parent Guarantor or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, consummate any Asset Sale unless: |
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(i) the consideration the Parent Guarantor or such Restricted Subsidiary receives for such Asset Sale is not less than the Fair Market Value of the assets sold (as determined in good faith by the Parent Guarantor’s Board of Directors); |
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(ii) at least 75% of the consideration the Parent Guarantor or such Restricted Subsidiary receives in respect of such Asset Sale consists of (A) cash (including any Net Cash Proceeds received from the conversion within 90 days of such Asset Sale of securities, notes or other obligations received in consideration of such Asset Sale); (B) Cash Equivalents; (C) the assumption by the purchaser of (x) the Parent Guarantor’s Debt or Debt of any Restricted Subsidiary (other than Subordinated Debt) as a result of which neither the Parent Guarantor nor any of the Restricted Subsidiaries remains obligated in respect of such Debt or (y) Debt of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, if the Parent Guarantor and each other Restricted Subsidiary is released from any guarantee of such Debt as a result of such Asset Sale; (D) Replacement Assets; (E) any Designated Non-cash Consideration received by the Parent Guarantor or such Restricted Subsidiary in such Asset Sale having an |
aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (ii), not to exceed the greater of $225,000,000 and 3.00% of Total Assets at the time of the receipt of such Designated Non-cash Consideration, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value; or (F) a combination of the consideration specified in sub-clauses (A) to (E) of this Section 4.09(a)(ii); and |
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(iii) the Parent Guarantor delivers an Officer’s Certificate to the Trustee certifying that such Asset Sale complies with the provisions described in sub-clauses (i) and (ii) of this Section 4.09(a). |
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(b) If the Parent Guarantor or any Restricted Subsidiary consummates an Asset Sale, the Net Cash Proceeds from such Asset Sale, within 360 days after the consummation of such Asset Sale, may be used by the Parent Guarantor or such Restricted Subsidiary to (A) permanently repay, purchase or prepay any then outstanding (i) Debt of the Parent Guarantor or any Restricted Subsidiary (and to effect a corresponding commitment reduction if such Debt is revolving credit borrowings) owing to a Person other than the Parent Guarantor or a Restricted Subsidiary to the extent secured by a Lien (ii) Debt of a Restricted Subsidiary that is not a Guarantor owing to a Person other than the Parent Guarantor or a Restricted Subsidiary or (iii) any other Pari Passu Debt other than the Existing Unsecured Notes, the New Unsecured Notes or any other unsecured Debt that is guaranteed on a subordinated basis (B) invest in any Replacement Assets, (C) acquire all or substantially all of the assets of, or any Capital Stock of, another Similar Business, if, after giving effect to any such acquisition of Capital Stock, the Similar Business is or becomes a Restricted Subsidiary, or (D) any combination of the foregoing; provided that in the case of sub-clause (B) of this Section 4.09(b), if the Parent Guarantor or such Restricted Subsidiary, as the case may be, has entered into a binding commitment in definitive form within such 360-day period to so apply such Net Cash Proceeds with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”), such binding commitment shall be treated as a permitted application of such Net Cash Proceeds; provided, further, that if any Acceptable Commitment is later cancelled or terminated for any reason before such Net Cash Proceeds are applied and after such initial 360-day period, then such Net Cash Proceeds shall constitute Excess Proceeds. The amount of such Net Cash Proceeds not so used as set forth in this Section 4.09(b) constitutes “Excess Proceeds”. The Parent Guarantor may reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. |
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(c) The Parent Guarantor or the Issuers may also at any time, and the Parent Guarantor or the Issuers shall within 20 Business Days after the aggregate amount of Excess Proceeds exceeds the greater of $100,000,000 and 1.5% of Total Assets, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt (which, in the case of Excess Proceeds which constitute proceeds from the sale or other disposition of Collateral, were secured by a Lien on such Collateral), to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in this Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of $1,000 with respect to the Dollar Notes and as an integral multiple of €1,000 with respect to the Euro Notes) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase. |
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(d) To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the |
Parent Guarantor may use the amount of such Excess Proceeds not used to purchase the Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by this Indenture. If the aggregate principal amount of the Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each Holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero. |
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(e) If the Parent Guarantor or the Issuers are obligated to make an Excess Proceeds Offer, the Parent Guarantor or the Issuers shall purchase the Notes and Pari Passu Debt, at the option of the holders thereof, in whole or in part (as an integral multiple of $1,000 with respect to the Dollar Notes and as an integral multiple of €1,000 with respect to the Euro Notes), on a date that is not earlier than 30 days and not later than 60 days from the date the notice of the Excess Proceeds Offer is given to such holders, or such later date as may be required under the Exchange Act provided that Dollar Notes of $200,000 and Euro Notes of €100,000 will be purchased in full. |
If the Parent Guarantor or the Issuers are required to make an Excess Proceeds Offer, the Parent Guarantor and the Issuers shall comply with the applicable tender offer rules, including Rule 14e-1 under the Exchange Act, and any other applicable securities laws and regulations, including any securities laws of Ireland and the requirements of any applicable securities exchange on which Notes or the Existing Ardagh Bonds are then listed. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09, the Issuers shall comply with such securities laws and regulations and shall not be deemed to have breached their obligations described in this Section 4.09 by virtue thereof.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, enter into or suffer to exist any transaction or series of related transactions (including, without limitation, the sale, purchase, exchange or lease of assets or property or the rendering of any service) with, or for the benefit of, any Affiliate of the Parent Guarantor or any Restricted Subsidiary’s Affiliate involving aggregate consideration in excess of the greater of $75,000,000 and 2.0% of Total Assets unless: |
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(i) such transaction or series of transactions is on terms that, taken as a whole, are not materially less favorable to the Parent Guarantor or such Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable arm’s‑length transaction with third parties that are not Affiliates; and |
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(ii) with respect to any transaction or series of related transactions involving aggregate payments or the transfer of assets or provision of services, in each case having a value greater than the greater of $150,000,000 and 2.0% of Total Assets, the Parent Guarantor shall deliver a resolution of its Board of Directors (set out in an Officer’s Certificate to the Trustee) resolving that such transaction complies with Section 4.10(a)(i) and that the fairness of such transaction has been approved by a majority of the Disinterested Directors (or in the event there is only one Disinterested Director, by such Disinterested Director) of the Parent Guarantor’s Board of Directors. |
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(b) Notwithstanding the foregoing, the restrictions set forth in Section 4.10(a) will not apply to: |
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(i) customary directors’ fees, indemnification and similar arrangements (including the payment of directors’ and officers’ insurance premiums), consulting fees, employee salaries, |
bonuses, employment agreements and arrangements, compensation or employee benefit arrangements, including stock options or legal fees; |
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(ii) any Restricted Payment not prohibited by Section 4.08 or the making of an Investment that is a Permitted Investment; |
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(iii) the agreements and arrangements existing on the Issue Date and any amendment, modification or supplement thereto; provided that any such amendment, modification or supplement to the terms thereof is not more disadvantageous to the Holders and to the Parent Guarantor and the Restricted Subsidiaries, as applicable, in any material respect than the original agreement or arrangement as in effect on the Issue Date; |
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(iv) any payments or other transactions pursuant to a tax sharing agreement between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries file a consolidated tax return or with which the Issuers are part of a consolidated group for tax purposes or any tax advantageous group contribution made pursuant to applicable legislation, provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand‑alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(v) transactions in the ordinary course of business with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of the Parent Guarantor solely because the Parent Guarantor owns, directly or through a Restricted Subsidiary, Capital Stock in, or controls, such Person; |
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(vi) the issuance of securities pursuant to, or for the purpose of the funding of, employment arrangements, stock options, and stock ownership plans, as long as the terms thereof are or have been previously approved by the Parent Guarantor’s Board of Directors; |
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(vii) the granting and performance of registration rights for the Parent Guarantor’s securities; |
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(viii) (A) issuances or sales of Qualified Capital Stock of the Parent Guarantor or Deeply Subordinated Funding and (B) any amendment, waiver or other transaction with respect to any Deeply Subordinated Funding in compliance with the other provisions of this Indenture; |
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(ix) pledges by the Parent Guarantor or any Restricted Subsidiary of the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture securing Debt owing by such Unrestricted Subsidiary or a Permitted Joint Venture; |
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(x) transactions with a joint venture made in the ordinary course of business; |
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(xi) transactions between or among the Parent Guarantor and the Restricted Subsidiaries or between or among Restricted Subsidiaries; |
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(xii) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are fair to the Parent Guarantor or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of |
Directors of the Parent Guarantor or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person; |
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(xiii) any transaction effected as part of a Permitted Receivables Financing; |
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(xiv) pledges of equity interests of Unrestricted Subsidiaries; |
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(xv) any employment agreement, consultancy agreement or employee benefit arrangement with any employee, consultant, officer or director of the Parent Guarantor or any Restricted Subsidiary, including under any stock option, stock appreciation rights, stock incentive or similar plans, entered into in the ordinary course of business; and |
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(xvi) (x) the Transactions and the payment of all costs and expenses (including all legal, accounting and other professional fees and expenses) related to the Transactions or any payment as contemplated by the Transaction Agreement; (y) any transactions or services pursuant to the Mutual Services Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s length basis; and (z) any transactions or services pursuant to the IP Cross-License Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s length basis. |
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(a) If a Change of Control occurs at any time, then the Issuers or the Parent Guarantor shall make an offer (a “Change of Control Offer”) to each Holder to purchase such Holder’s Notes, at a purchase price (the “Change of Control Purchase Price”) in cash in an amount equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (the “Change of Control Purchase Date”) (subject to the rights of holders of record on relevant regular Record Dates that are prior to the Change of Control Purchase Date to receive interest due on an Interest Payment Date). |
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(b) Within 30 days following any Change of Control, the Issuers or the Parent Guarantor shall: |
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(i) cause a notice of the Change of Control Offer to be: |
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(A) delivered to holders of the Notes electronically or mailed by first-class mail, postage prepaid; and |
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(B) if at the time of such notice the Notes are listed on Euronext Dublin and the rules of Euronext Dublin so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) send notice of the Change of Control Offer by first‑class mail, with a copy to the Trustee, to each Holder to the address of such Holder appearing in the Security Register, which notice shall state: |
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(A) that a Change of Control has occurred, and the date it occurred; |
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(B) the circumstances and relevant facts regarding such Change of Control (including, but not limited to, applicable information with respect to pro forma historical income, cash flow and capitalization after giving effect to the Change of Control); |
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(C) the Change of Control Purchase Price and the Change of Control Purchase Date, which shall be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations; |
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(D) that any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Purchase Date unless the Change of Control Purchase Price is not paid; |
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(E) that any Note (or part thereof) not tendered shall continue to accrue interest; and |
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(F) any other procedures that a Holder must follow to accept a Change of Control Offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on Euronext Dublin). |
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(c) On the Change of Control Purchase Date, the Issuers shall, to the extent lawful: |
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(i) accept for payment all Notes or portions thereof (equal to, in the case of Dollar Notes, $200,000 or an integral multiple of $1,000 in excess thereof, and, in the case of Euro Notes, €100,000 or an integral multiple of €1,000 in excess thereof) properly tendered pursuant to the Change of Control Offer; |
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(ii) deposit with the Paying Agent an amount equal to the Change of Control Purchase Price in respect of all Notes or portions thereof so tendered; and |
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(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Issuers. |
The Issuers or the Parent Guarantor will publicly announce the results of the Change of Control Offer on, or as soon as practical after, the Change of Control Purchase Date.
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(d) The Paying Agent shall promptly mail to each Holder that has properly tendered its Notes pursuant to the Change of Control Offer an amount equal to the Change of Control Purchase Price for such Notes and the Trustee shall itself or via the authenticating agent promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder a new Note or Notes equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Euro Note shall be in a principal amount of €100,000 and in integral multiples of €1,000 in excess thereof and each such new Dollar Note shall be in a principal amount of $200,000 and in integral multiples of $1,000 in excess thereof. |
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(e) If the Change of Control Purchase Date is on or after an interest Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest, if any, shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date, and no additional interest shall be payable to Holders who tender pursuant to the Change of Control Offer. |
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(f) Neither the Issuers nor the Parent Guarantor shall be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth herein applicable to a Change of Control |
Offer made by the Issuers or the Parent Guarantor and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. |
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(g) The Issuers and the Parent Guarantor shall comply with the applicable tender offer rules, including Rule 14e-l under the Exchange Act, and any other applicable securities laws and regulations in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Indenture, the Issuers and the Parent Guarantor shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Indenture by virtue of such conflict. |
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(h) Notwithstanding anything to the contrary contained in this Section 4.11, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. |
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(a) All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on the Notes or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, a Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to the Notes or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted. |
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(b) None of the Issuers or Guarantors shall, however, pay Additional Amounts in respect or on account of: |
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(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of the Notes, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee); |
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(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of the Notes, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing |
Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction); |
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(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes; |
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(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to the Notes or any Guarantee; |
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(v) any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note; |
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(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union; |
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(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Note been presented on the last day of such 30-day period); |
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(viii) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or |
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(ix) any combination of the foregoing. |
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(c) The Issuers and the Guarantors, if the applicable withholding agents, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law. |
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(d) At least 30 calendar days prior to each date on which any payment under or with respect to the Notes or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to the Notes or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. |
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of the Notes or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, the Notes or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuer and the Guarantors (and not otherwise in the possession of the Trustee) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
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(e) Whenever this Indenture or the Notes refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to any Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable. |
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(f) This Section 4.12 will survive any termination, defeasance or discharge of this Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on the Notes (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax. |
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(a) At the request and direction of the Parent Guarantor and without the consent of the Holders, in connection with the incurrence by the Parent Guarantor or its Restricted Subsidiaries of any Permitted Debt, the Parent Guarantor, the relevant Restricted Subsidiaries, the Trustee and the Security Agent shall enter into with the Holders (or their duly authorized representatives) an intercreditor agreement (an “Additional Intercreditor Agreement”) or a restatement, amendment or other modification of the existing Intercreditor Agreement, in each case on substantially the same terms as the Intercreditor Agreement or terms not violating the terms of this Indenture (for such matters covered by this Indenture) or terms not affecting adversely the rights of the Holders of the Notes in material respects (for such matters not covered by this Indenture), including containing substantially the same terms with respect to release of Guarantees and priority and release of the Security Interests; provided that such Additional Intercreditor Agreement will not impose any personal obligations on the Trustee or Security Agent or, in the opinion of the Trustee or Security Agent, as applicable, adversely affect the rights, duties, liabilities or immunities of the Trustee or Security Agent under this Indenture or the Intercreditor Agreement. |
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(b) At the request and direction of the Parent Guarantor and without the consent of the Holders, the Trustee and the Security Agent shall from time to time enter into one or more amendments to any Intercreditor Agreement to: (i) cure any ambiguity, omission, defect or inconsistency of any such |
agreement, (ii) increase the amount or types of Debt covered by any such agreement that may be incurred by an Issuer or a Guarantor that is subject to any such agreement (including with respect to any Intercreditor Agreement or Additional Intercreditor Agreement, the addition of provisions relating to new Debt ranking junior in right of payment to the Notes), (iii) add Restricted Subsidiaries to the Intercreditor Agreement or an Additional Intercreditor Agreement, (iv) further secure the Notes (including Additional Notes), (v) make provision for equal and ratable pledges of the Collateral to secure Additional Notes, (vi) implement any Permitted Collateral Liens, (vii) amend the Intercreditor Agreement or any Additional Intercreditor Agreement in accordance with the terms thereof or (viii) make any other change to any such agreement that does not violate the terms of this Indenture. The Parent Guarantor shall not otherwise direct the Trustee or the Security Agent to enter into any amendment to any Intercreditor Agreement without the consent of the Holders of the majority in aggregate principal amount of the Notes then outstanding, except as otherwise permitted below under Article Nine, and the Parent Guarantor may only direct the Trustee and the Security Agent to enter into any amendment to the extent such amendment does not impose any personal obligations on the Trustee or Security Agent or, in the opinion of the Trustee or Security Agent, adversely affect their respective rights, duties, liabilities or immunities under this Indenture or the Intercreditor Agreement or any Additional Intercreditor Agreement. |
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(c) In relation to any Intercreditor Agreement or Additional Intercreditor Agreement, the Trustee (and Security Agent, if applicable) shall consent on behalf of the Holders to the payment, repayment, purchase, repurchase, defeasance, acquisition, retirement or redemption of any obligations subordinated to the Notes thereby; provided, however, that such transaction would comply with Section 4.08. |
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(d) Each Holder, by accepting a Note, shall be deemed to have agreed to and accepted the terms and conditions of the Intercreditor Agreement or any Additional Intercreditor Agreement (whether then entered into or entered into in the future pursuant to the provisions described in this Section 4.13) and to have directed the Trustee or Security Agent, as applicable, to enter into any such Additional Intercreditor Agreement. The Issuers shall make a copy of the Intercreditor Agreement or any Additional Intercreditor Agreement available for inspection by Holders during normal business hours on any Business Day upon prior written request at the offices of the Listing Agent. |
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(a) (i) On or prior to the 90th day following the Issue Date and subject to the Agreed Security Principles, the Parent Guarantor shall ensure that each of the Subsidiaries of the Parent Guarantor (other than the Issuers) that is a guarantor of the Existing Ardagh Bonds (other than Enville Limited and the F&S Carve-out Subsidiaries) becomes a Subsidiary Guarantor and (ii) if the Disposition has not been completed on or before April 14, 2020, each of the F&S Carve-out Subsidiaries that guarantees the Existing Ardagh Bonds becomes a Subsidiary Guarantor no later than 30 days following April 14, 2020 and, in connection therewith, cause such Subsidiary and entities to deliver such agreements, instruments, certificates and opinions of counsel that may be reasonably requested by the Trustee. |
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(b) On or prior to the 90th day following the Issue Date and subject to the Agreed Security Principles, the Parent Guarantor shall ensure that Security Interests for the benefit of the Trustee and the Holders in any assets that secure the Existing Secured Notes (other than any Security Interests in the Capital Stock of, or any assets or property owned by, Enville Limited or the F&S Carve-out Subsidiaries) are in place and perfected no later than 90 days following the Issue Date and (ii) if the Disposition has not been completed on or before April 14, 2020, Security Interests for the benefit of the Trustee and the Holders in the Capital Stock of, or any assets or property owned by, the F&S Carve out Subsidiaries that guarantee the Existing Secured Notes (in each case, to the extent secured for the benefit of the trustees and the holders of |
the Existing Secured Notes) are in place and perfected no later than 30 days following April 14, 2020, in each case, subject to Section 11.04. |
Notwithstanding the foregoing, following the replacement and/or refinancing of the Existing Secured Notes, all mortgages or similar Security Interests in real property in any jurisdiction other than the England and Wales or any state of the United States shall be released, and such real property shall no longer comprise Collateral.
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(a) The Parent Guarantor shall not permit any Restricted Subsidiary that is not an Issuer or a Guarantor, directly or indirectly, to guarantee, assume or in any other manner become liable for the payment of any Pari Passu Debt or Subordinated Debt of either Issuer (other than the Notes), the Parent Guarantor or any Subsidiary Guarantor, unless: |
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(i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to this Indenture providing for a Guarantee of payment of the Notes by such Restricted Subsidiary on the same terms as the guarantee of such Debt; and |
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(ii) with respect to any guarantee of Subordinated Debt by such Restricted Subsidiary, any such guarantee shall be subordinated to such Restricted Subsidiary’s Guarantee with respect to the Notes at least to the same extent as such Subordinated Debt is subordinated to the Notes. |
This clause (a) shall not be applicable to any guarantees of any Restricted Subsidiary:
existing on the Issue Date, guaranteeing Debt under Credit Facilities permitted to be incurred pursuant to Section 4.06(b)(ii) and Section 4.06(b)(xiii) or guaranteeing Debt in an aggregate principal amount that is less than the greater of $100,000,000 and 1.5% of Total Assets;
that existed at the time such Person became a Restricted Subsidiary if the guarantee was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary; or
given to a bank or trust company having combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating, at the time such guarantee was given, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s, in connection with the operation of cash management programs established for the Parent Guarantor’s benefit or that of any Restricted Subsidiary.
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(b) Notwithstanding the foregoing, any Guarantee of the Notes created pursuant to the provisions described in Section 4.15(a) above may provide by its terms that it will be automatically and unconditionally released and discharged upon: |
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(i) any sale, exchange or transfer, to any Person who is not the Parent Guarantor or a Restricted Subsidiary of all of the Capital Stock owned by the Parent Guarantor and its other Restricted Subsidiaries in, or all or substantially all the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by this Indenture); or |
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(ii) (with respect to any Guarantee created after the Issue Date) the release by the Holders of the applicable Issuer’s, the Parent Guarantor’s or the Subsidiary Guarantor’s Debt described in Section 4.15(a) above, of their Guarantee by such Restricted Subsidiary (including any |
deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee), at a time when: |
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(A) no other Debt of either Issuer, the Parent Guarantor or any Subsidiary Guarantor has been guaranteed by such Restricted Subsidiary; or |
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(B) the holders of all such other Debt that is guaranteed by such Restricted Subsidiary also release their guarantee by such Restricted Subsidiary (including any deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee); or |
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(iii) the release of the Guarantees on the terms and conditions and in the circumstances described in Section 10.03. |
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(c) Notwithstanding the foregoing, the Parent Guarantor shall not be obligated to cause any such Restricted Subsidiary to guarantee the Notes to the extent that such Guarantee would reasonably be expected to give rise to or result in (A) any violation of applicable law, rule, regulation or order that cannot be avoided or otherwise prevented through measures reasonably available to the Parent Guarantor or such Restricted Subsidiary, (B) personal liability for the officers, directors or shareholders of such Restricted Subsidiary or (C) any significant cost, expense, liability or obligation (including with respect to any Taxes but excluding any reasonable guarantee or similar fee payable to the Parent Guarantor or a Restricted Subsidiary) other than any governmental or regulatory filings required as a result of, or any measures pursuant to sub-clause (A) of this Section 4.15(c) undertaken in connection with, such Guarantee, which cannot be avoided through measures reasonably available to the Parent Guarantor or the Restricted Subsidiary; provided, however, that any Restricted Subsidiary who directly or indirectly, guarantees, assumes or in any other manner become liable for the payment of any obligations under the Existing Ardagh Bonds shall also be required to Guarantee payment of the Notes on the same terms as the guarantee of such obligations. |
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(d) Each such additional Guarantee will be limited as necessary to recognize certain defenses generally available to guarantors (including those that relate to fraudulent conveyance or transfer, voidable preference, financial assistance, corporate purpose and corporate benefit, thin capitalization, distributable reserves, capital maintenance or similar laws, regulations or defenses affecting the rights of creditors generally) or other considerations under applicable law. |
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SECTION 4.16. Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries. |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Restricted Subsidiary to: |
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(i) pay dividends, in cash or otherwise, or make any other distributions on or in respect of its Capital Stock or any other interest or participation in, or measured by, its profits; |
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(ii) pay any Debt owed to the Parent Guarantor or any other Restricted Subsidiary; |
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(iii) make loans or advances to the Parent Guarantor or any other Restricted Subsidiary; or |
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(iv) transfer any of its properties or assets to the Parent Guarantor or any other Restricted Subsidiary. |
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(b) The provisions of Section 4.16(a) shall not apply to: |
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(i) encumbrances and restrictions imposed by the Notes, the New Unsecured Notes, the Existing Ardagh Bonds, this Indenture, the indenture governing the New Unsecured Notes, any Credit Facility, the indentures governing the Existing Ardagh Bonds, the Intercreditor Agreement (or any Additional Intercreditor Agreement), the Senior Holdco Notes and the security documents related thereto or by other indentures or agreements governing other Debt incurred ranking equally with the Notes; |
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(ii) any customary encumbrances or restrictions created under any agreements with respect to Debt of the Parent Guarantor or any Restricted Subsidiary permitted to be incurred subsequent to the Issue Date pursuant to the provisions of Section 4.06, including encumbrances or restrictions imposed by Debt permitted to be incurred under Credit Facilities or any guarantees thereof in accordance with Section 4.06; provided that such agreements do not prohibit the payment of interest with respect to the Notes or the Guarantees absent a default or event of default under such agreement; |
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(iii) encumbrances or restrictions contained in any agreement in effect on the Issue Date (other than an agreement described in another sub-clause of this Section 4.16(b)); |
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(iv) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), encumbrances and restrictions that restrict in a customary manner the subletting, assignment or transfer of any properties or assets that are subject to a lease, license, conveyance or other similar agreement to which the Parent Guarantor or any Restricted Subsidiary is a party; |
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(v) encumbrances or restrictions contained in any agreement or other instrument of a Person (including its Subsidiaries), acquired by the Parent Guarantor or any Restricted Subsidiary in effect at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired (including its Subsidiaries); |
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(vi) encumbrances or restrictions contained in contracts for sales of Capital Stock or assets permitted by the provisions of Section 4.09 with respect to the assets or Capital Stock to be sold pursuant to such contract or in customary merger or acquisition agreements (or any option to enter into such contract) for the purchase or acquisition of Capital Stock or assets or any of the Parent Guarantor’s Subsidiaries by another Person; |
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(vii) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), any customary encumbrances or restrictions pertaining to any asset or property subject to a Lien to the extent set forth in the security document or any related document governing such Lien; |
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(viii) encumbrances or restrictions imposed by applicable law or regulation or by governmental licenses, concessions, franchises or permits; |
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(ix) encumbrances or restrictions on cash or other deposits or net worth imposed by customers under contracts entered into the ordinary course of business; |
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(x) customary limitations on the distribution or disposition of assets or property in joint venture agreements entered into the ordinary course of business and in good faith by any Restricted Subsidiary; provided that such encumbrance or restriction is applicable only to such Restricted Subsidiary and its Subsidiaries; |
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(xi) in the case of Section 4.16(a)(iv), customary encumbrances or restrictions in connection with purchase money obligations, mortgage financings and Capitalized Lease Obligations for property acquired in the ordinary course of business; |
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(xii) any encumbrance or restriction arising by reason of customary non-assignment provisions in agreements; |
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(xiii) encumbrances or restrictions with respect to any Permitted Receivables Financing; provided that such encumbrances or restrictions are customarily required by the institutional sponsor or arranger of such Permitted Receivables Financing in similar types of documents relating to the purchase of similar receivables in connection with the financing thereof; |
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(xiv) encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to a Permitted Joint Venture; |
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(xv) encumbrances or restrictions incurred in accordance with Section 4.07; or |
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(xvi) any encumbrances or restrictions existing under any agreement that extends, renews, amends, modifies, restates, supplements, refunds, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing sub-clauses (i) through (xv); provided that the terms and conditions of any such encumbrances or restrictions are not materially less favorable, taken as a whole, to the Holders of the Notes than those under or pursuant to the agreement so extended, renewed, amended, modified, restated, supplemented, refunded, refinanced or replaced. |
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(a) The Parent Guarantor’s Board of Directors may designate any Subsidiary (including newly acquired or newly established Subsidiaries) to be an “Unrestricted Subsidiary” only if no Default has occurred and is continuing at the time of or after giving effect to such designation. |
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(b) In the event of any designation of a Subsidiary as an Unrestricted Subsidiary in accordance with this Section 4.17, the Parent Guarantor shall be deemed to have made an Investment constituting a Restricted Payment pursuant to Section 4.08 for all purposes of this Indenture in an amount equal to the greater of (i) the net book value of the Parent Guarantor’s interest in such Subsidiary calculated in accordance with IFRS or (ii) the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary. |
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(c) The Parent Guarantor’s Board of Directors may designate any Unrestricted Subsidiary as a Restricted Subsidiary if: |
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(i) no Default or Event of Default has occurred and is continuing at the time of or will occur and be continuing after giving effect to such designation; and |
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(ii) (x) the Parent Guarantor could incur at least $1.00 of additional Debt (pursuant to Section 4.06(a)) or (y) the Fixed Charge Coverage Ratio would not be less than it was immediately |
prior to giving effect to such designation, in each case, on a pro forma basis taking into account such designation. |
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(d) Any designation of a Subsidiary as an Unrestricted Subsidiary or Restricted Subsidiary by the Parent Guarantor’s Board of Directors in accordance with this Section 4.17 shall be evidenced to the Trustee by filing a resolution of the Parent Guarantor’s Board of Directors with the Trustee giving effect to such designation and an Officer’s Certificate certifying that such designation complies with the foregoing conditions, and giving the effective date of such designation. Any such filing with the Trustee must occur within 45 days after the end of the Parent Guarantor’s fiscal quarter in which such designation is made (or, in the case of a designation made during the last fiscal quarter of the Parent Guarantor’s fiscal year, within 90 days after the end of such fiscal year). |
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SECTION 4.19. Reports to Holders. So long as any Notes are outstanding, the Issuers or the Parent Guarantor shall furnish to the Trustee: |
within 120 days after the end of each of the Parent Guarantor’s fiscal year’s annual reports containing the following information: (a) audited consolidated balance sheets of the Parent Guarantor as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Parent Guarantor for the two most recent fiscal years, including footnotes to such financial statements and the report of the Parent Guarantor’s independent auditors on the financial statements; (b) an operating and financial review of the audited financial statements, including a discussion of the results of operations, financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (c) a description of the business and management of the Parent Guarantor; and (d) material recent developments to the extent not previously reported;
within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Parent Guarantor’s quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year-to-date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Parent Guarantor, together with condensed footnote disclosure; (b) operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Parent Guarantor and any material change between the current quarterly period and the corresponding period of the prior year; and (c) material recent developments to the extent not previously reported; and
promptly after the occurrence of any material acquisition, disposition or restructuring of the Parent Guarantor and the Restricted Subsidiaries, taken as a whole, or any change of the entire Board of Directors, chairman of the Board of Directors, chief executive officer
or chief financial officer at the Parent Guarantor or change in auditors of the Parent Guarantor, a press release containing a description of such event.
In addition, the Issuers or the Parent Guarantor shall furnish to the Holders and to prospective investors, upon the requests of such Holders, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the Exchange Act by Persons who are not “affiliates” under the Securities Act.
The Issuers or the Parent Guarantor shall also make available copies of all reports furnished to the Trustee (a) on the website of the Ardagh group of companies and (b) through the newswire service of Bloomberg, or, if Bloomberg does not then operate, any similar agency.
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(a) The Parent Guarantor shall not, in a single transaction or through a series of transactions, consolidate with or merge with or into any other Person or sell, assign, convey, transfer, lease or otherwise dispose of, or take any action pursuant to any resolution passed by the Parent Guarantor’s Board of Directors or shareholders with respect to a demerger or division pursuant to which the Parent Guarantor would dispose of, all or substantially all of the Parent Guarantor’s properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) to any other Person or Persons and the Parent Guarantor shall not permit any Restricted Subsidiary to enter into any such transaction or series of transactions if such transaction or series of transactions, in the aggregate, would result in the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor and its Restricted Subsidiaries on a consolidated basis to any other Person or Persons. |
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(b) Section 5.01(a) shall not apply if: |
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(i) at the time of, and immediately after giving effect to, any such transaction or series of transactions, either the Parent Guarantor will be the continuing corporation or the Person (if other than the Parent Guarantor) formed by or surviving any such consolidation or merger or to which such sale, assignment, conveyance, transfer, lease or disposition of all or substantially all the properties and assets of the Parent Guarantor and the Restricted Subsidiaries on a consolidated basis has been made (the “Surviving Entity”): |
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(A) will be a corporation duly incorporated and validly existing under the laws of any member state of the European Union or the European Economic Area, the United States of America, any state thereof, the District of Columbia, Canada, Switzerland, Australia or Bermuda; and |
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(B) expressly assumes, by a supplemental indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture and will assume the Parent Guarantor’s obligations under the Security Documents, and the Notes, this Indenture and the Security Documents shall remain in full force and effect as so supplemented; |
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(ii) immediately after giving effect to such transaction or series of transactions on a pro forma basis (and treating any Obligation of the Parent Guarantor or any Restricted Subsidiary incurred in connection with or as a result of such transaction or series of transactions as having been incurred by the Parent Guarantor or such Restricted Subsidiary at the time of such transaction), no Default or Event of Default will have occurred and be continuing; |
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(iii) immediately before and immediately after giving effect to such transaction or series of transactions on a pro forma basis (on the assumption that the transaction or series of transactions occurred on the first day of the four-quarter fiscal period immediately prior to the consummation of such transaction or series of transactions with the appropriate adjustments with respect to the transaction or series of transactions being included in such pro forma calculation), the Parent Guarantor (or the Surviving Entity if the Parent Guarantor is not the continuing obligor under this Indenture) could incur at least $1.00 of additional Debt under the provisions of Section 4.06; |
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(iv) any Subsidiary Guarantor, unless it is the other party to the transactions described in this Section 5.01, shall have by supplemental indenture confirmed that its Guarantee will apply to such Person’s obligations under this Indenture and the Notes; |
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(v) the Liens on Collateral shall remain in full force and effect securing the Notes and the Guarantees, as applicable; and |
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(vi) the Parent Guarantor or the Surviving Entity shall have delivered to the Trustee, in form and substance satisfactory to the Trustee, an Officer’s Certificate (attaching the computations to demonstrate compliance with Section 5.01(b)(iii)) and an opinion of independent counsel, each stating that such consolidation, merger, sale, assignment, conveyance, transfer, lease or other disposition, and if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with the requirements of this Indenture and that this Indenture and the Notes constitute legal, valid and binding obligations of the continuing person, enforceable in accordance with their terms. |
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(c) Notwithstanding anything to the contrary set forth above, the Parent Guarantor may designate any Person as a successor parent guarantor (the “Successor Parent Guarantor”); provided that the Parent Guarantor could have merged or amalgamated into such Person in accordance with the provisions hereof, at the time of, and immediately after giving effect to such designation; provided, further, that such Successor Parent Guarantor expressly assumes, by a supplemental indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture. |
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(d) The Surviving Entity or Successor Parent Guarantor, as applicable, shall succeed to, and be substituted for, and may exercise every right and power of, the Parent Guarantor under this Indenture, but, in the case of a lease of all or substantially all of the Parent Guarantor’s assets or in the case of the designation of a Successor Parent Guarantor in accordance with Section 5.01(c), the Parent Guarantor shall not be released from the obligation to pay the principal of, premium, if any, and interest, on the Notes. |
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(e) Nothing in this Indenture shall prevent (i) any Restricted Subsidiary from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor or any other Restricted Subsidiary, (ii) any Subsidiary Guarantor from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor, either Issuer or another Subsidiary Guarantor (and upon any such transfer, the Guarantee of the transferring Subsidiary Guarantor shall automatically be released); provided that if such Restricted Subsidiary is a party to any of the Security Documents, arrangements satisfactory to the Trustee are made to maintain the Lien on Collateral granted under such Security Documents) or (iii) the Parent Guarantor from appointing any Person as Successor Parent Guarantor; provided that such appointment is made in accordance with Section 5.01(c) above. |
The Parent Guarantor shall publish a notice of any consolidation, merger or sale of assets described in Section 5.01(a) in accordance with Section 12.02 and, so long as the rules of Euronext Dublin so require, notify such exchange of any such consolidation, merger or sale.
its obligation to pay the principal of, premium, if any, or interest and Additional Amounts, if any, on the Notes in the case of a lease of all or substantially all of its property and assets. |
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(a) “Event of Default”, wherever used herein, means any of the following events: |
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(i) a default for 30 days in the payment when due of any interest or any Additional Amounts on any Note; or |
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(ii) default in the payment of the principal of or premium, if any, on any Note at its Maturity (upon acceleration, optional or mandatory redemption, if any, required repurchase or otherwise); or |
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(iii) failure to comply with the provisions of Article Five; or |
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(iv) failure to comply with any covenant or agreement of the Parent Guarantor or of any Restricted Subsidiary that is contained herein or any Guarantees (other than specified in sub-clause (i), (ii) or (iii) of this Section 6.01(a)) and such failure continues for a period of 60 days or more, in each case after the written notice specified in Section 6.02(a); or |
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(v) default under the terms of any instrument evidencing or securing the Debt of the Parent Guarantor or any Restricted Subsidiary having an outstanding principal amount in excess of the greater of (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets, in each case, individually or in the aggregate, if that default: (x) results in the acceleration of the payment of such Debt or (y) is caused by the failure to pay such Debt at final maturity thereof after giving effect to the expiration of any applicable grace periods and other than by regularly scheduled required prepayment, and such failure to make any payment has not been waived or the maturity of such Debt has not been extended, and in either case the total amount of such Debt unpaid or accelerated exceeds (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time; or |
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(vi) any Guarantee ceases to be, or shall be asserted in writing by any Guarantor, or any Person acting on behalf of any Guarantor, not to be in full force and effect or enforceable in accordance with its terms (other than as provided for in this Indenture, any Guarantee, the Intercreditor Agreement or any Additional Intercreditor Agreement); or |
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(vii) the Security Interests purported to be created under any Security Document will, at any time, cease to be in full force and effect and constitute a valid and perfected Lien with the priority required by the applicable Security Document, the Intercreditor Agreement and/or any Additional Intercreditor Agreement with respect to Collateral having a Fair Market Value in excess of (i) for so long the Existing Secured Notes remain outstanding, €75,000,000 and (ii) thereafter, the greater of $150,000,000 and 2.0% of Total Assets for any reason other than the satisfaction in full of all obligations under this Indenture and discharge of this Indenture or in accordance with the terms of the Intercreditor Agreement and/or any Additional Intercreditor Agreement, or any Security Interest purported to be created thereunder is declared invalid or unenforceable or the Parent Guarantor or any Subsidiary Guarantor granting Collateral the subject of any such Security |
Interest asserts, in any pleading in any court of competent jurisdiction, that any such Security Interest is invalid or unenforceable and (but only in the event that such failure to be in full force and effect or such assertion is capable of being cured without imposing any new hardening period, in equity or at law, that such Security Interest was not otherwise subject immediately prior to such failure or assertion) such failure to be in full force and effect or such assertion has continued uncured for a period of 15 days; or |
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(viii) one or more final judgments, orders or decrees (not subject to appeal and not covered by insurance or indemnities) shall be rendered against the Parent Guarantor or any Material Subsidiary, either individually or in an aggregate amount, in excess of (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) therafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time, and either a creditor shall have commenced an enforcement proceeding upon such judgment, order or decree or there shall have been a period of 60 consecutive days or more during which a stay of enforcement of such judgment, order or decree was not (by reason of pending appeal or otherwise) in effect; or |
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(ix) the entry by a court of competent jurisdiction of (A) a decree or order for relief in respect of the Parent Guarantor or any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or (B) a decree or order adjudging the Parent Guarantor or any Material Subsidiary bankrupt or insolvent, or seeking reorganization, arrangement, adjustment or composition of or in respect of the Parent Guarantor or any Material Subsidiary under any applicable law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Parent Guarantor or any Material Subsidiary or of any substantial part of their respective properties or ordering the winding up or liquidation of their affairs, and any such decree, order or appointment pursuant to any Bankruptcy Law for relief shall continue to be in effect, or any such other decree, appointment or order shall be unstayed and in effect, for a period of 100 consecutive days; or |
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(x) (A) the Parent Guarantor or any Material Subsidiary (x) commences a voluntary case or proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent or (y) consents to the filing of a petition, application, answer or consent seeking reorganization or relief under any applicable Bankruptcy Law, (B) the Parent Guarantor or any Material Subsidiary consents to the entry of a decree or order for relief in respect of the Parent Guarantor or such Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it or, (C) the Parent Guarantor or any Material Subsidiary (x) consents to the appointment of, or taking possession by, a custodian, receiver, liquidator, administrator, supervisor, assignee, trustee, sequestrator or similar official of the Parent Guarantor or such Material Subsidiary or of any substantial part of their respective properties, (y) makes an assignment for the benefit of creditors or (z) admits in writing its inability to pay its debts generally as they become due. |
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(b) If a Default or an Event of Default occurs and is continuing and is known to a responsible officer of the Trustee, the Trustee shall mail to each Holder notice of the Default or Event of Default within 15 Business Days after its occurrence by registered or certified mail or facsimile transmission of an Officer’s Certificate specifying such event, notice or other action, its status and what action the Issuers are taking or proposes to take with respect thereto. Except in the case of a Default or an Event of Default in payment of principal of, premium, if any, and Additional Amounts or interest on any Notes, the Trustee may withhold the notice to the Holders of such Notes if its Trust Officers in good faith determines that withholding the notice is in the interests of the Holders. The Trustee shall not be deemed to have knowledge of a Default unless a Trust Officer has actual knowledge of such Default. The Issuers and the Parent |
Guarantor shall also notify the Trustee within 15 Business Days of the occurrence of any Default stating what action, if any, they are taking with respect to that Default. |
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(a) If an Event of Default with respect to the Notes (other than an Event of Default specified in clauses (ix) or (x) of Section 6.01(a)) occurs and is continuing, the Trustee or the Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders) may, and the Trustee, upon the written request of such Holders shall, declare the principal amount of, premium, if any, and any Additional Amounts and accrued interest on all of the outstanding Notes immediately due and payable, and upon any such declaration all such amounts payable in respect of the Notes shall become immediately due and payable. |
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(b) If an Event of Default specified in clauses (ix) or (x) of Section 6.01(a) occurs and is continuing, then the principal amount of, premium, if any, and Additional Amounts and accrued and unpaid interest on all of the outstanding Notes shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. |
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(c) At any time after a declaration of acceleration under this Indenture, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in aggregate principal amount of the outstanding Notes, by written notice to the Issuers, the Parent Guarantor and the Trustee, may rescind and annul such declaration of acceleration and its consequences if: |
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(i) the Parent Guarantor or either Issuer has paid or deposited with the Trustee a sum sufficient to pay: |
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(A) all overdue interest and Additional Amounts, if any, on all Notes then outstanding; |
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(B) all unpaid principal of and premium, if any, on any outstanding Notes that have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Notes; |
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(C) to the extent that payment of such interest is lawful, interest upon overdue interest and overdue principal at the rate borne by the Notes; and |
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(D) all sums paid or advanced by the Trustee under this Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; |
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(ii) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and |
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(iii) all Events of Default, other than the non-payment of amounts of principal of, premium, if any, and any Additional Amounts and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.04. |
No such rescission shall affect any subsequent default or impair any right consequent thereon.
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(d) In the event of a declaration of acceleration of the Notes because an Event of Default as described in Section 6.01(a)(v) has occurred and is continuing, the declaration of acceleration of the Notes shall be automatically annulled if the event of default or payment default triggering such Event of Default pursuant to Section 6.01(a)(v) shall be remedied or cured, or waived by the holders of the Debt that gave rise to such Event of Default, or such Debt shall have been discharged in full, within 20 days after the Event of Default arose and if (1) the annulment of the acceleration (if applicable) of the Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, except nonpayment of principal, premium or interest, including Additional Amounts, if any, on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived. |
All rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee, and all rights of action and claims under the Security Documents may be prosecuted or enforced under the Security Documents by the Security Agent (in consultation with the Trustee, where appropriate), without the possession of any of the Notes or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee or the Security Agent shall be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee or the Security Agent, their agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.
in the payment of the principal of, premium, if any, Additional Amounts, if any, or interest on any Note; or
in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the holders of 90% of the outstanding Notes.
Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
the Trustee may refuse to follow any direction that conflicts with law, this Indenture or that the Trustee determines, without obligation, in good faith may be unduly prejudicial to the rights of Holders not joining in the giving of such direction;
the Trustee may refuse to follow any direction that the Trustee determines is unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability; and
the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction.
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SECTION 6.06. Limitation on Suits. A Holder may not institute any proceedings or pursue any remedy with respect to this Indenture or the Notes unless: |
the Holders of at least 30% in aggregate principal amount of outstanding Notes shall have made a written request to the Trustee to pursue such remedy;
such Holder or Holders offer the Trustee indemnity and/or security (including by way of pre-funding) reasonably satisfactory to the Trustee against any costs, liability or expense;
the Trustee does not comply with the request within 30 days after receipt of the request and the offer of indemnity and/or security (including by way of pre-funding); and
during such 30-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes do not give the Trustee a direction that is inconsistent with the request.
The limitations in the foregoing provisions of this Section 6.06, however, do not apply to a suit instituted by a Holder for the enforcement of the payment of the principal of, premium, if any, Additional Amounts, if any, or interest, if any, on such Note on or after the respective due dates expressed in such Note.
A Holder may not use this Indenture to prejudice the rights of any other Holder or to obtain a preference or priority over another Holder.
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SECTION 6.08. Collection Suit by Trustee. The Issuers covenant that if default is made in the payment of: |
any installment of interest on any Note when such interest becomes due and payable and such default continues for a period of 30 days, or
the principal of (or premium, if any, on) any Note at the Maturity thereof,
the Issuers shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Notes, the whole amount then due and payable on such Notes for principal (and premium, if any), Additional Amounts, if any and interest, and interest on any overdue principal (and premium, if any) and Additional Amounts, if any and, to the extent that payment of such interest shall be legally enforceable, upon any overdue installment of interest, at the rate borne by the Notes, and, in addition thereto, such further amount as shall be sufficient to cover the amounts provided for in Section 7.05 and such further amount as
shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Issuers fail to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuers or any other obligor upon the Notes and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Issuers or any other obligor upon the Notes, wherever situated.
Nothing herein contained shall be deemed to empower the Trustee to authorize or consent to, or accept or adopt on behalf of any Holder, any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
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SECTION 6.10. Application of Money Collected. If the Trustee collects any money or property pursuant to this Article Six, it shall pay out the money or property in the following order: |
FIRST:to the Trustee, any Agent, and the Security Agent for amounts due under Section 7.05;
SECOND:to Holders for amounts due and unpaid on the Notes for principal of, premium, if any, interest, if any, and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, interest, if any, and Additional Amounts, if any, respectively; and
THIRD:to the Issuers, any Guarantor or any other obligors of the Notes, as their interests may appear, or as a court of competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 30 days before such record date, the Issuers shall mail to each Holder and the Trustee
a notice that states the record date, the payment date and amount to be paid. This Section 6.10 is subject at all times to the provisions set forth in Section 11.02.
Notwithstanding the foregoing, the Security Agent shall apply the proceeds of the Collateral as directed by the Intercreditor Agreement or any Additional Intercreditor Agreement.
Security Agent, but shall suffer and permit the execution of every such power as though no such law had been enacted. |
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(a) If an Event of Default has occurred and is continuing of which a Trust Officer of the Trustee or the Security Agent has actual knowledge, the Trustee or the Security Agent shall exercise such of the rights and powers vested in it by this Indenture, the Intercreditor Agreement, and any Additional Intercreditor Agreement and the Security Documents and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs; |
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(b) Subject to the provisions of Section 7.01(a), (i) the Trustee and the Security Agent undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and the Security Documents and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee and the Security Agent; and (ii) in the absence of bad faith on its part, the Trustee and the Security Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and the Security Agent and conforming to the requirements of this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and the Security Documents. In the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee or the Security Agent, the Trustee and the Security Agent, as applicable, shall examine same to determine whether they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); |
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(c) The Security Agent shall execute and deliver, if necessary, and act as beneficiary under, the Security Documents on behalf of the Holders under this Indenture and shall take such other actions as may be necessary or advisable in accordance with the Security Documents. The Security Agent shall remit any proceeds recovered from enforcement of the Security Documents; provided that all necessary approvals are obtained from each relevant jurisdiction in which the Collateral is located. |
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(d) Neither the Trustee nor the Security Agent shall be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: |
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(i) this clause (d) does not limit the effect of Section 7.01(b); |
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(ii) the Trustee and the Security Agent shall not be liable for any error of judgment made in good faith by a Trust Officer of the Trustee or the Security Agent unless it is proved that the Trustee or the Security Agent was negligent in ascertaining the pertinent facts; and |
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(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.02 or 6.05; |
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(e) The Trustee, any Paying Agent and the Security Agent shall not be liable for interest on any money received by it except as the Trustee, any Paying Agent and the Security Agent may agree in writing with the Issuers or the Subsidiary Guarantors. Money held in trust by the Trustee, the Principal Paying Agent or the Security Agent need not be segregated from other funds except to the extent required by law and, for the avoidance of doubt, shall not be held in accordance with the UK Client Money Rules; |
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(f) No provision of this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement or the Security Documents shall require the Trustee, each Agent, the Principal Paying Agent or the Security Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not assured to it; and |
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(g) Any provisions hereof or of the Intercreditor Agreement, any Additional Intercreditor Agreement or of the Security Documents relating to the conduct or affecting the liability of or affording protection to the Trustee, each Agent, or the Security Agent, as the case may be, shall be subject to the provisions of this Section 7.01. |
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(a) Subject to Section 7.01: |
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(i) following the occurrence of a Default or an Event of Default, the Trustee is entitled to require all Agents to act under its direction; |
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(iii) before the Trustee or the Security Agent act or refrain from acting, they may require an Officer’s Certificate or an Opinion of Counsel or both, which shall conform to Section 12.04. Neither the Trustee nor the Security Agent shall be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion and such certificate or opinion will be equal to complete authorization; |
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(iv) the Trustee and the Security Agent may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care by it hereunder; |
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(v) neither the Trustee nor the Security Agent shall be under any obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee and the Security Agent security and/or indemnity (including by way of pre-funding) satisfactory to them against the costs, expenses and liabilities that might be incurred by them in compliance with such request or direction; |
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(vi) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from either Issuer will be sufficient if signed by an officer of such Issuer; |
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(vii) neither the Trustee nor the Security Agent shall be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; |
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(viii) whenever, in the administration of this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and the Security Documents, the Trustee and the Security Agent shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee and the Security Agent (unless other evidence be herein |
specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate; |
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(ix) neither the Trustee nor the Security Agent shall be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee and the Security Agent, in their discretion, individually, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee or the Security Agent shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuers personally or by agent or attorney; |
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(x) neither the Trustee nor the Security Agent shall be required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture; |
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(xi) in the event the Trustee or the Security Agent receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal amount of the Notes then outstanding, pursuant to the provisions of this Indenture, the Trustee and the Security Agent, in their discretion, may determine what action, if any, will be taken; |
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(xii) the permissive rights of the Trustee and the Security Agent to take the actions permitted by this Indenture will not be construed as an obligation or duty to do so; |
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(xiii) delivery of reports, information and documents to the Trustee under Section 4.19 is for informational purposes only and the Trustee’s receipt of the foregoing will not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Parent Guarantor’s or any of its Restricted Subsidiary’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates); |
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(xiv) the rights, privileges, protections, immunities and benefits given to each of the Trustee and the Security Agent in this Indenture, including, without limitation, its rights to be indemnified and compensated, are extended to, and will be enforceable by, the Trustee and the Security Agent in each of their capacities hereunder, by the Registrar, the Agents, and each agent, custodian and other Person employed to act hereunder; |
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(xv) the Trustee and the Security Agent may consult with counsel and the advice of such counsel or any Opinion of Counsel will, subject to Section 7.01(c), be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; |
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(xvi) the Trustee and the Security Agent shall have no duty to inquire as to the performance of the covenants of the Parent Guarantor and/or its Restricted Subsidiaries in Article Four hereof; |
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(xvii) the Trustee and the Security Agent shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Indenture or under applicable law or regulation with respect to |
any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Notes, but may at its sole discretion, choose to do so; |
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(xviii) in no event shall the Trustee or the Security Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of, or caused by, directly or indirectly, forces beyond its control, including, without limitation, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances; and |
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(xix) neither the Trustee nor the Security Agent shall under any circumstance be liable for any consequential loss or punitive damages (including loss of business, goodwill, opportunity or profit of any kind) of the Issuers, any Guarantor or any Restricted Subsidiary. |
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(b) The Trustee and the Security Agent may request that the Issuers deliver an Officer’s Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. |
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(c) The Security Agent shall accept without investigation, requisition or objection such right and title as the Issuers and any Guarantor may have to any of the Collateral and shall not be bound or concerned to examine or enquire into or be liable for any defect or failure in the right or title of the Issuers or any Guarantor to the Collateral or any part thereof whether such defect or failure was known to the Security Agent or might have been discovered upon examination or enquiry and whether capable of remedy or not and shall have no responsibility for the validity, value or sufficiency of the Collateral. |
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(d) Without prejudice to the provisions hereof, the Security Agent shall not be under any obligation to insure any of the Collateral or any certificate, note, bond or other evidence in respect thereof, or to require any other person to maintain any such insurance and shall not be responsible for any loss, expense or liability which may be suffered as a result of any assets comprised in the Collateral being uninsured or inadequately insured. |
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(e) The Security Agent shall not be responsible for any loss, expense or liability occasioned to the Collateral, howsoever caused, by the Security Agent or by any act or omission on the part of any other person (including any bank, broker, depositary, warehouseman or other intermediary or by any clearing system or other operator thereof), or otherwise, unless such loss is occasioned by the willful misconduct or fraud of the Security Agent. |
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(f) Beyond the exercise of reasonable care in the custody thereof, the Security Agent shall have no duty or liability as to any Collateral in its possession or control or in the possession or control of any agent or bailee or any income thereon or as to preservation of rights against prior parties or any other rights pertaining thereto and the Security Agent shall not be responsible for filing any financing or continuation statements or recording any documents or instruments in any public office at any time or times or otherwise perfecting or maintaining the perfection of any security interest in the Collateral. The Security Agent shall be deemed to have exercised reasonable care in the custody of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which it accords its own property and shall not be liable or responsible for any loss or diminution in the value of any of the Collateral by reason of the act or omission of any carrier, forwarding agency or other agent or bailee selected by the Security Agent in good faith. |
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(g) Neither the Trustee nor the Security Agent is required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture or the Notes. |
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(h) Neither the Trustee nor the Security Agent will be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control. |
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(i) Notwithstanding anything else herein contained, the Trustee and Agents may refrain without liability from doing anything that would or might in its opinion be contrary to any law of any state or jurisdiction (including but not limited to include the European Union and the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may without liability do anything which is, in its opinion, necessary to comply with any such law, directive or regulation. |
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(j) The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York. |
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(k) Both the Trustee and the Security Agent may assume without inquiry in the absence of actual knowledge that the Issuers are duly complying with their obligations contained in this Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Notes has occurred. |
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(l) At any time that the security granted pursuant to the Security Documents has become enforceable and the Holders have given a direction to the Trustee to enforce such security, the Trustee is not required to give any direction to the Security Agent with respect thereto unless it has been indemnified and/or secured to its satisfaction in accordance with this Indenture. In any event, in connection with any enforcement of such security, the Trustee is not responsible for: |
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(i) any failure of the Security Agent to enforce such security within a reasonable time or at all; |
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(ii) any failure of the Security Agent to pay over the proceeds of enforcement of the security; |
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(iii) any failure of the Security Agent to realize such security for the best price obtainable; |
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(iv) monitoring the activities of the Security Agent in relation to such enforcement; |
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(v) taking any enforcement action itself in relation to such security; |
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(vi) agreeing to any proposed course of action by the Security Agent which could result in the Trustee incurring any liability for its own account; or |
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(vii) paying any fees, costs or expenses of the Security Agent. |
Notes and, may otherwise deal with the Issuers with the same rights it would have if it were not Trustee, the Security Agent, Paying Agent, Transfer Agent, Registrar or such other agent. The Trustee and the Security Agent may accept deposits from, lend money to, and generally engage in any kind of banking, trust or other business with either Issuer or any of their respective Affiliates or Subsidiaries as if it were not performing the duties specified herein, in the Intercreditor Agreement, any Additional Intercreditor Agreement and in the Security Documents, and may accept fees and other consideration from the Issuers for services in connection with this Indenture and otherwise without having to account for the same to the Trustee, the Security Agent or to the Holders from time to time. |
The Issuers, failing which the Guarantors, shall indemnify the Trustee and the Security Agent against any and all loss, liability or expense (including attorneys’ fees and expenses) incurred by either of them without willful misconduct or negligence on their part arising out of or in connection with the administration of this trust and the performance of their duties hereunder (including the costs and expenses of enforcing this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and the Security Documents against the Issuers and the Guarantors (including this Section 7.05) and defending themselves against any claim, whether asserted by the Issuers, the Guarantors, any Holder or any other Person, or liability in connection with the execution and performance of any of their powers and duties
hereunder). The Trustee and the Security Agent shall notify the Issuers promptly of any claim for which they may seek indemnity. Failure by the Trustee or the Security Agent to so notify the Issuers shall not relieve the Issuers or any Guarantor of its obligations hereunder. The Issuers shall, at the sole discretion of the Trustee or Security Agent, as applicable, defend the claim and the Trustee and the Security Agent may cooperate and may participate at the Issuers’ expense in such defense. Alternatively, the Trustee and the Security Agent may at their option have separate counsel of their own choosing and the Issuers shall pay the properly incurred fees and expenses of such counsel. The Issuers need not pay for any settlement made without its consent, which consent may not be unreasonably withheld. The Issuers shall not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
To secure the Issuers’ payment obligations in this Section 7.05, the Trustee and the Security Agent shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, in their capacity as Trustee and the Security Agent, except money or property, including any proceeds from the sale of Collateral, held in trust to pay principal of, premium, if any, additional amounts, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of all Notes under this Indenture.
When either the Trustee or the Security Agent incur expenses after the occurrence of a Default specified in Section 6.01(a)(ix) or (x) with respect to the Issuers, the Guarantors, or any Restricted Subsidiary, the expenses are intended to constitute expenses of administration under Bankruptcy Law.
The Issuers’ obligations under this Section 7.05 and any claim or Lien arising hereunder shall survive the resignation or removal of any Trustee and the Security Agent, the satisfaction and discharge of the Issuers’ obligations pursuant to Article Eight and any rejection or termination under any Bankruptcy Law, and the termination of this Indenture.
The Trustee and, subject to the appointment and acceptance of a successor Security Agent as provided in this Section and the last paragraph of this Section 7.06, the Security Agent may resign at any time without giving any reason by so notifying the Issuers. The Holders of a majority in outstanding principal amount of the outstanding Notes may remove the Trustee and the Security Agent by so notifying the Trustee, the Security Agent and the Issuers. The Issuers shall remove the Trustee if:
the Trustee or the Security Agent fails to comply with Section 7.09;
the Trustee or the Security Agent is adjudged bankrupt or insolvent;
a receiver or other public officer takes charge of the Trustee or the Security Agent or their property; or
the Trustee or the Security Agent otherwise becomes incapable of acting.
If the Trustee or the Security Agent resigns or is removed, or if a vacancy exists in the office of Trustee or the Security Agent for any reason, the Issuers shall promptly appoint a successor Trustee or a successor Security Agent, as the case may be. Within one year after the successor Trustee or Security Agent takes office, the Holders of a majority in principal amount of the outstanding Notes may appoint a successor Trustee or Security Agent to replace the successor Trustee or Security Agent appointed by the Issuers. If
the successor Trustee or Security Agent does not deliver its written acceptance required by the next succeeding paragraph of this Section 7.06 within 30 days after the retiring Trustee or Security Agent resigns or is removed, the retiring Trustee or Security Agent, the Issuers or the Holders of a majority in principal amount of the outstanding Notes may, at the expense of the Issuers, petition any court of competent jurisdiction for the appointment of a successor Trustee or Security Agent.
A successor Trustee or Security Agent shall deliver a written acceptance of its appointment to the retiring Trustee or Security Agent, as the case may be, and to the Issuers. Thereupon the resignation or removal of the retiring Trustee or Security Agent shall become effective, and the successor Trustee or Security Agent shall have all the rights, powers and duties of the Trustee or the Security Agent under this Indenture. The successor Trustee or Security Agent shall mail a notice of its succession to Holders. The retiring Trustee or Security Agent shall promptly transfer all property held by it as Trustee or Security Agent to the successor Trustee or Security Agent; provided that all sums owing to the Trustee or Security Agent hereunder have been paid and subject to the Lien provided for in Section 7.05.
If a successor Trustee or Security Agent does not take office within 60 days after the retiring Trustee or Security Agent resigns or is removed, the retiring Trustee or Security Agent, the Issuers or the Holders of at least 30% in outstanding principal amount of the Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee or Security Agent at the expense of the Issuers. Without prejudice to the right of the Issuers to appoint a successor Trustee or a successor Security Agent in accordance with the provisions of this Indenture, the retiring Trustee or Security Agent may appoint a successor Trustee or Security Agent at any time prior to the date on which a successor Trustee or Security Agent takes office.
If the Trustee or the Security Agent fails to comply with Section 7.09, any Holder who has been a bona fide Holder of a Note for at least six months may petition any court of competent jurisdiction for the removal of the Trustee or the Security Agent and the appointment of a successor Trustee or Security Agent.
In addition to the foregoing and notwithstanding any provision to the contrary, any resignation, removal or replacement of the Security Agent pursuant to this Section 7.06 shall not be effective until (a) a successor to the Security Agent has agreed to act under the terms of this Indenture and (b) all of the Security Interests in the Collateral has been transferred to such successor. Any replacement or successor Security Agent shall be a bank with an office in New York, New York or London, United Kingdom, or an Affiliate of any such bank. Upon acceptance of its appointment as Security Agent hereunder by a replacement or successor, such replacement or successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Security Agent hereunder, and the retiring Security Agent shall be discharged from its duties and obligations hereunder.
Notwithstanding the replacement of the Trustee or the Security Agent pursuant to this Section 7.06, the Issuers’ and the Guarantors’ obligations under Section 7.05 shall continue for the benefit of the retiring Trustee or Security Agent.
Notes so authenticated with the same effect as if such successor Trustee had itself authenticated such Notes. In case at that time any of the Notes shall not have been authenticated, any successor Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and effect which this Indenture provides for the certificate of authentication of the Trustee shall have; provided that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Notes in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. |
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(a) The Security Agent may perform any of its duties and exercise any of its rights and powers through one or more sub-agents or co-trustees appointed by it. The Security Agent and any such sub-agent or co-trustee may perform any of its duties and exercise any of its rights and powers through its affiliates. All of the provisions of this Indenture applicable to the Security Agent (other than covenants and obligations relating to the Parallel Debt) including, without limitation, its rights to be indemnified, shall apply to and be enforceable by any such sub-agent and affiliates of a Security Agent and any such sub-agent or co-trustee. All references herein to a “Security Agent” (other than covenants and obligations relating to the Parallel Debt) shall include any such sub-agent or co-trustee and affiliates of a Security Agent or any such sub-agent or co-trustee. |
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(b) It is the purpose of this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and the Security Documents that there shall be no violation of any Law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as agent or trustee in such jurisdiction. Without limiting Section 7.08(a), it is recognized that in case of litigation under, or enforcement of, this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement or any of the Security Documents, or in case the Security Agent deems that by reason of any present or future law of any jurisdiction it may not exercise any of the rights, powers or remedies granted herein or in any of the Security Documents or take any other action which may be desirable or necessary in connection therewith, the Security Agent is hereby authorized to appoint an additional individual or institution selected by the Security Agent in its sole discretion as a separate trustee, co-trustee, administrative agent, Security Agent, administrative sub-agent or administrative so-agent (any such additional individual or institution being referred to herein individually as a “Supplemental Security Agent” and collectively as “Supplemental Security Agents”). |
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(c) In the event that the Security Agent appoints a Supplemental Security Agent with respect to any Collateral, (i) each and every right, power, privilege or duty expressed or intended by this Indenture or any of the other Security Documents (other than the rights arising in respect of the Parallel Debts under Section 11.05) to be exercised by or vested in or conveyed to such Security Agent with respect to such Collateral shall be exercisable by and vest in such Supplemental Security Agent to the extent, and only to the extent, necessary to enable such Supplemental Security Agent to exercise such rights, powers and privileges with respect to such Collateral and to perform such duties with respect to such Collateral, and every covenant and obligation contained in the Security Documents and necessary to the exercise or |
performance thereof by such Supplemental Security Agent (other than covenants and obligations relating to the Parallel Debt) shall run to and be enforceable by either such Security Agent or such Supplemental Security Agent, and (ii) the provisions of this Indenture (and, in particular, this Article Seven) that refer to the Security Agent shall inure to the benefit of such Supplemental Security Agent and all references therein to the Security Agent shall be deemed to be references to a Security Agent and/or such Supplemental Security Agent, as the context may require. |
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(d) Should any instrument in writing from the Issuers or any other obligor be required by any Supplemental Security Agent so appointed by the Security Agent for more fully and certainly vesting in and confirming to him or it such rights, powers, privileges and duties, the Parent Guarantor shall, or shall cause the Issuers and relevant Guarantor to, execute, acknowledge and deliver any and all such instruments promptly upon request by the Security Agent. In case any Supplemental Security Agent, or a successor thereto, shall die, become incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such Supplemental Security Agent, to the extent permitted by Law, shall vest in and be exercised by the Security Agent until the appointment of a new Supplemental Security Agent. |
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(a) It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture, and in particular in case of the enforcement thereof on Default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Trustee or hold title to the properties, in trust, as herein granted or take any action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an individual or institution as a separate or co-trustee. |
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(b) In the event that the Trustee appoints an additional individual or institution as a separate or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and Lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co-trustee but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and only to the extent that the Trustee by the laws of any jurisdiction is incapable of exercising such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of them. |
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(c) Should any instrument in writing from the Issuers be required by the separate or co-trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to him or it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall to the extent permitted by the laws of the State of New York and the jurisdictions of organization of the Issuers, on request, be executed, acknowledged and delivered by the Issuers; provided that if an Event of Default shall have occurred and be continuing, if the Issuers do not execute any such instrument within 15 days after request therefor, the Trustee shall be empowered as an attorney-in-fact for the Issuers to execute any such instrument in the Issuers’ name and stead. In case any separate or co-trustee or a successor to either |
shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate or co-trustee. |
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(d) Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: |
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(i) all rights and powers, conferred or imposed upon the Trustee shall be conferred or imposed upon and may be exercised or performed by such separate trustee or co-trustee; and |
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(ii) no trustee hereunder shall be liable by reason of any act or omission of any other trustee hereunder. |
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(e) Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article Seven. |
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(f) Any separate trustee or co-trustee may at any time appoint the Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successors trustee. |
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(a) Any Agent may resign its appointment hereunder at any time without the need to give any reason and without being responsible for any costs associated therewith by giving to the Issuers and the Trustee and (except in the case of resignation of the Principal Paying Agent) the Principal Paying Agent 30 days’ written notice to that effect (waivable by the Issuers and the Trustee); provided that in the case of resignation of the Principal Paying Agent no such resignation shall take effect until a new Principal Paying Agent (approved in advance in writing by the Trustee) shall have been appointed by the Issuers to exercise the powers and undertake the duties hereby conferred and imposed upon the Principal Paying Agent. Following receipt of a notice of resignation from any Agent, the Issuers shall promptly give notice thereof to the Holders in accordance with Section 12.02. Such notice shall expire at least 30 days before or after any due date for payment in respect of the Notes. |
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(b) If any Agent gives notice of its resignation in accordance with this Section 7.11 and a replacement Agent is required and by the tenth day before the expiration of such notice such replacement has not been duly appointed, such Agent may itself appoint as its replacement any reputable and experienced financial institution. Immediately following such appointment, the Issuers shall give notice of such appointment to the Trustee, the remaining Agents and the Holders whereupon the Issuers, the Trustee, the remaining Agents and the replacement Agent shall acquire and become subject to the same rights and obligations between themselves as if they had entered into an agreement in the form mutatis mutandis of this Indenture. |
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(c) Upon its resignation becoming effective the Principal Paying Agent shall forthwith transfer all moneys held by it hereunder hereof to the successor Principal Paying Agent or, if none, the Trustee or to the Trustee’s order, but shall have no other duties or responsibilities hereunder, and shall be entitled to |
the payment by the Issuers of its remuneration for the services previously rendered hereunder and to the reimbursement of all reasonable expenses (including legal fees) incurred in connection therewith. |
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(a) Actions of Agents. The rights, powers, duties and obligations and actions of each Agent under this Indenture are several and not joint or joint and several. |
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(b) Agents of Trustee. The Issuers and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuers and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee. Prior to receiving such written notification from the Trustee, the Agents shall be the agents of the Issuers and need have no concern for the interests of the Holders. |
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(c) Funds held by Agents. The Agents will hold all funds as banker subject to the terms of this Indenture and as a result, such money will not be held in accordance with the rules established by the Financial Conduct Authority in the Financial Conduct Authority’s Handbook of rules and guidance from time to time in relation to client money. |
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(d) Publication of Notices. Any obligation the Agents may have to publish a notice to Holders of Global Notes on behalf of the Issuers will be met upon delivery of the notice to DTC, Euroclear and/or Clearstream. |
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(e) Instructions. In the event that instructions given to any Agent are not reasonably clear, then such Agent shall be entitled to seek clarification from the Issuers or other party entitled to give the Agents instructions under this Indenture by written request promptly, and in any event within one Business Day of receipt by such Agent of such instructions. If an Agent has sought clarification in accordance with this Section 7.12, then such Agent shall be entitled to take no action until such clarification is provided, and shall not incur any liability for not taking any action pending receipt of such clarification. |
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(f) No Fiduciary Duty. No Agent shall be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust, for or with any person other than the Issuers. |
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(g) Mutual Undertaking. Each Party shall, within ten Business Days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this Section 7.12(g) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality. For purposes of this Section 7.12(g), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature. |
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(h) Tax Withholding. |
The Issuers shall notify each Agent in the event that they determine that any payment to be made by an Agent under the Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated; provided, however, that the Issuers’ obligations under this Section 7.12(h) shall apply only to the extent that such payments are so treated by virtue of characteristics of either Issuer, the Notes, or both.
Notwithstanding any other provision of this Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuers the amount so deducted or withheld, in which case, the Issuers shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.12(h)(ii).
If the Issuers exercise their legal defeasance option, each Guarantor, if any, shall be released from all its obligations under its Guarantee, and the Trustee shall execute a release of such Guarantee.
Subsidiary Guarantors shall be released from their obligations under any covenant contained in Sections 4.04 through 4.11 (inclusive), Sections 4.13 through 4.17 (inclusive), Sections 4.19 through 4.21 (inclusive) and Section 5.01 with respect to the Notes on and after the date the conditions set forth in Section 8.04 are satisfied (hereinafter, “covenant defeasance”). For this purpose, such covenant defeasance means that, the Issuers and the Parent Guarantor may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default, but, except as specified in this Section 8.03, the remainder of this Indenture and such Notes shall be unaffected thereby. |
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SECTION 8.04. Conditions to Defeasance. In order to exercise either legal defeasance or covenant defeasance: |
the Issuers or the Parent Guarantor must irrevocably deposit or cause to be deposited as trust funds in trust with the Trustee (or such other party as directed by the Trustee), for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination thereof (in the case of the Dollar Notes), and cash in euro, European Government Obligations, or a combination thereof (in the case of the Euro Notes), in such amounts as will be sufficient, in the opinion of an internationally recognized law firm of independent public accountants, to pay and discharge the principal of, premium, if any, and accrued and unpaid interest and any Additional Amounts, if any, on the outstanding Notes on the Stated Maturity or on the applicable Redemption Date, as the case may be, and the Issuers or the Parent Guarantor must (i) specify whether the Notes are being defeased to maturity or to a particular Redemption Date; and (ii) if applicable, have delivered to the Trustee an irrevocable notice to redeem all of the outstanding Notes of such principal, premium, if any, or interest;
in the case of an election under Section 8.02, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee stating that (A) the U.S. Internal Revenue Service has either published a revenue ruling or issued to the Issuers a private letter ruling, or (B) since the Issue Date, there has been a change in applicable U.S. federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such legal defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred;
in the case of an election under Section 8.03, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee to the effect that the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred;
no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) or, insofar as bankruptcy or insolvency events described in clauses (ix) and (x) of Section 6.01(a) are concerned, at any time during the period ending on the 123rd day after the date of such deposit;
such legal defeasance or covenant defeasance shall not cause the Trustee to have a conflicting interest as defined in this Indenture with respect to any of the Issuers’ securities;
such legal defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) under, this Indenture or any material agreement or instrument to which the Parent Guarantor or any Restricted Subsidiary is a party or by which the Parent Guarantor or any Restricted Subsidiary is bound;
such legal defeasance or covenant defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the U.S. Investment Company Act of 1940, as amended, unless such trust shall be registered under such Act or exempt from registration thereunder;
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel in the country of each Issuer’s or the Parent Guarantor’s incorporation to the effect that after the 123rd day following the deposit, the trust funds shall not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and an Opinion of Counsel reasonably acceptable to the Trustee that the Trustee shall have a perfected security interest in such trust funds for the ratable benefit of the Holders;
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Officer’s Certificate stating that the deposit was not made by the Issuers or the Parent Guarantor with the intent of preferring the Holders over the other creditors of the Issuers or the Parent Guarantor with the intent of defeating, hindering, delaying or defrauding creditors of the Issuers or the Parent Guarantor or others, or removing assets beyond the reach of the relevant creditors or increasing debts of the Issuers or the Parent Guarantor to the detriment of the relevant creditors;
no event or condition shall exist that would prevent the Issuers from making payments of the principal of, premium, if any, and interest on the Notes on the date of such deposit or at any time ending on the 123rd day after the date of such deposit; and
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the legal defeasance or the covenant defeasance, as the case may be, have been complied with.
If the funds deposited with the Trustee to effect covenant defeasance are insufficient to pay the principal of, premium, if any, and interest on the Notes when due because of any acceleration occurring after an Event of Default, then the Issuers and the Guarantors shall remain liable for such payments.
the Issuers or the Parent Guarantor has irrevocably deposited or caused to be deposited with the Trustee (or such other party as directed by the Trustee) as funds in trust for such purpose an amount in cash in U.S. dollars, U.S. Government Securities or a combination of cash in dollars and U.S. Government Securities (in the case of the Dollar Notes), and cash in euros,
European Government Obligations or a combination of cash in euros and European Government Obligations (in the case of the Euro Notes) sufficient to pay and discharge the entire Debt on such Notes not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and accrued and unpaid interest, Additional Amounts, if any, to the date of such deposit (in the case of Notes which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be and the Issuers or the Parent Guarantor shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of such Notes at Maturity or on the Redemption Date, as the case may be, and either:
all Notes previously authenticated and delivered (other than lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuers and thereafter repaid to the Issuers or discharged from such trust, as provided in Section 8.07) have been delivered to the Trustee for cancellation; or
all Notes not theretofore delivered to the Trustee for cancellation (A) have become due and payable (by reason of the mailing of a notice of redemption or otherwise) or (B) will become due and payable at Stated Maturity within one year or (C) 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 Issuers’ name, and at the Issuers’ expense;
the Issuers or the Parent Guarantor has paid or caused to be paid all other amounts payable by the Issuers under this Indenture; and
the Issuers or the Parent Guarantor has delivered an Officer’s Certificate and an Opinion of Counsel to the Trustee each stating that: (x) all conditions precedent to satisfaction and discharge have been satisfied, and (y) such satisfaction and discharge will not result in a breach or violation of, or constitute a default under, this Indenture, the Security Documents or any other agreement or instrument governed by the laws of the State of New York to which either Issuer or any Subsidiary is a party or by which either Issuer or any Subsidiary is bound.
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(a) The Issuers, each when authorized by a resolution of its respective Board of Directors (as evidenced by the delivery of such resolutions to the Trustee), the Guarantors and the Trustee may modify, amend or supplement this Indenture, any Guarantee or the Notes and the Issuers, each when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent and copied to the Trustee), the Guarantors and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder: |
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(i) to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants herein and in the Notes; provided that such |
successor Person would have been permitted to so succeed in a transaction that would have complied with Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of Article Five shall apply mutatis mutandis); |
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(ii) to add to the covenants of the Issuers, any Guarantor or any other obligor upon the Notes for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon the Notes, as applicable, herein, in the Notes or in any Guarantees; |
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(iii) to cure any ambiguity, or to correct or supplement any provision herein, in the Notes or any Guarantees that may be defective or inconsistent with any other provision herein or in the Notes or any Guarantee or to make any other provisions with respect to matters or questions arising under this Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect; |
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(iv) to conform the text of this Indenture, the Guarantees, the Security Documents, or the Notes to any provision of the “Description of the Secured Notes” in the Offering Memorandum to the extent that such provision in such “Description of the Secured Notes” was intended to be a verbatim recitation of a provision of this Indenture, the Guarantees, the Security Documents or the Notes; |
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(v) to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in this Indenture and to add a Subsidiary Guarantor or other guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s)); |
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(vi) to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent hereunder or any Security Document; |
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(vii) to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations hereunder, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to this Indenture or otherwise to release Collateral from the Liens pursuant to this Indenture and the Security Documents when permitted or required by this Indenture, the Security Documents and/or the Intercreditor Agreement or to modify the Security Documents and/or the Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding obligations that are permitted to be secured by Liens pari passu with the Notes under the Security Documents pursuant to the terms of this Indenture; or |
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(viii) to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in this Indenture. |
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(b) The Issuers, each when authorized by a resolution of its respective Board of Directors (as evidenced by the delivery of such resolutions to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under this Indenture may supplement this Indenture to add a Subsidiary Guarantor or other Guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other Guarantor(s)) in each case without notice to or consent of any Holder. |
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(c) In formulating its opinion on such matters, the Trustee shall be entitled to require and rely conclusively on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate. |
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(a) Except as provided in Section 9.02(b) and Section 6.04 and without prejudice to Section 9.01, the Issuers, the Guarantors and the Trustee may: |
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(i) modify, amend or supplement this Indenture, the Security Documents or the Notes; or |
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(ii) waive compliance by the Issuers with any provision of this Indenture, the Security Documents or the Notes, |
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes) provided that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
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(b) Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 and an amendment, modification or supplement pursuant to Section 9.01, may: |
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(i) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note; |
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(ii) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note; |
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(iii) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable; |
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(iv) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date); |
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(v) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver of certain provisions of this Indenture; |
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(vi) modify any of the provisions of this Article Nine or any provisions herein relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby; |
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(vii) make any change to the Intercreditor Agreement (and/or any Additional Intercreditor Agreement) or any provisions of this Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders or directly or indirectly release the Liens on the Collateral except as permitted by this Indenture, the Intercreditor Agreement (or any Additional Intercreditor Agreement) and the Security Documents; or |
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(viii) make any change in Section 4.12 that adversely affects the rights of any Holder or amend the terms of the Notes or this Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture. |
(c)The consent of the Holders will not be necessary under this Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under this Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
binding obligation of the Issuers and the Guarantors (if any) enforceable against them in accordance with its terms, subject to customary exceptions. Such Opinion of Counsel shall be an expense of the Issuers. |
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(b) The aggregate principal amount of the Notes, at any date of determination, shall be the sum of (1) the principal amount of the Dollar Notes at such date of determination plus (2) the Dollar Equivalent, at such date of determination, of the principal amount of the Euro Notes at such date of determination. With respect to any matter requiring consent, waiver, approval or other action of the Holders of a specified percentage of the principal amount of all the Notes (and not solely the Dollar Notes or the Euro Notes as provided for in the proviso to the first sentence of Section 9.08(a)), such percentage shall be calculated, on the relevant date of determination, by dividing (i) the principal amount, as of such date of determination, of Notes, the Holders of which have so consented by (b) the aggregate principal amount, as of such date of determination, of the Notes then outstanding, in each case, as determined in accordance with the preceding sentence, Section 2.08 and Section 2.09 of this Indenture. Any such calculation made pursuant to this Section 9.08(b) shall be made by the Issuers and delivered to the Trustee pursuant to an Officer’s Certificate. |
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(a) (i) The Parent Guarantor hereby fully and, subject to the limitations on the effectiveness and enforceability set forth in Section 10.04, unconditionally guarantees, on a first priority (subject to Permitted Collateral Liens), senior secured, joint and several basis, and (ii) each Subsidiary Guarantor by execution of a supplemental indenture hereto, fully and, subject to the limitations on the effectiveness and enforceability set forth in such supplemental indenture, unconditionally guarantees, on a first priority (subject to Permitted Collateral Liens), senior secured, joint and several basis, in each case to each Holder and to the Trustee and its successors and assigns on behalf of each Holder, the full payment of principal of, premium, if any, interest, if any, and Additional Amounts, if any on, and all other monetary obligations of the Issuers under this Indenture and the Notes (including obligations to the Trustee and the obligations to pay Additional Amounts, if any) with respect to each Note authenticated and delivered by the Trustee or its agent pursuant to and in accordance with this Indenture, in accordance with the terms of this Indenture (all the foregoing being hereinafter collectively called the “Obligations”). The Guarantors further agree that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from the Guarantors and that the Guarantors shall remain bound under this Article Ten notwithstanding any extension or renewal of any Obligation. All payments under each Guarantee will be made in euro, in the case of the Euro Notes, and in U.S. dollars, in the case of the Dollar Notes. |
Indenture, any waiver, modification or indulgence granted to the Issuers with respect thereto by the Holders or the Trustee, or any other circumstance which may otherwise constitute a legal or equitable discharge of a surety or guarantor (except payment in full); provided that notwithstanding the foregoing, no such waiver, modification, indulgence or circumstance shall without the written consent of the Guarantors increase the principal amount of a Note or the interest rate thereon or change the currency of payment with respect to any Note, or alter the Stated Maturity thereof. The Guarantors hereby waive diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of either Issuer, any right to require that the Trustee pursue or exhaust its legal or equitable remedies against either Issuer prior to exercising its rights under a Guarantee (including, for the avoidance of doubt, any right which a Guarantor may have to require the seizure and sale of the assets of such Issuer to satisfy the outstanding principal of, interest on or any other amount payable under each Note prior to recourse against such Guarantor or its assets), protest or notice with respect to any Note or the Debt evidenced thereby and all demands whatsoever, and each covenant that their Guarantee will not be discharged with respect to any Note except by payment in full of the principal thereof and interest thereon or as otherwise provided in this Indenture, including Section 10.04. If at any time any payment of principal of, premium, if any, interest, if any, or Additional Amounts, if any, on such Note is rescinded or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of either Issuer, the Guarantors’ obligations hereunder with respect to such payment shall be reinstated as of the date of such rescission, restoration or returns as though such payment had become due but had not been made at such times. |
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(c) The Guarantors also agree to pay any and all costs and expenses (including reasonable attorneys’ fees) incurred by the Trustee or any Holder in enforcing any rights under this Section 10.01. |
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(a) Each Guarantor shall be subrogated to all rights of the Holders against the Issuers in respect of any amounts paid to such Holders by such Guarantor pursuant to the provisions of its Guarantee. |
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(b) The Guarantors agree that they shall not be entitled to any right of subrogation in relation to the Holders in respect of any Obligations guaranteed hereby until payment in full of all Obligations. The Guarantors further agree that, as between them, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the Obligations guaranteed hereby may be accelerated as provided in Section 6.02 for the purposes of the Guarantees herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such Obligations as provided in Section 6.02, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purposes of this Section 10.02 . |
upon any sale or disposition of (i) Capital Stock of a Subsidiary Guarantor following which such Subsidiary Guarantor is no longer a Restricted Subsidiary or, (ii) all or substantially all of the properties and assets of a Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary that does not violate Section 4.09;
in the event that all of the Capital Stock of such Subsidiary Guarantor is sold or otherwise disposed of pursuant to an enforcement of the security over the Capital Stock of such
Subsidiary Guarantor under the applicable Security Document(s) in accordance with the terms of the Intercreditor Agreement and any Additional Intercreditor Agreement;
upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary;
upon legal defeasance under Section 8.02, covenant defeasance under Section 8.03 or upon satisfaction and discharge under Section 8.05;
in the circumstances set forth in Section 5.01(d); and
as described in Article Nine.
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(a) Each Guarantee is limited to (i) an amount not to exceed the maximum amount that can be guaranteed by the Guarantor that gave such Guarantee without rendering such Guarantee, as it relates to such Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally or (ii) the maximum amount otherwise permitted by law. |
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(a) The due and punctual payment of the principal of, interest on and Additional Amounts, if any, on the Notes and the Guarantees when and as the same shall be due and payable, whether on an Interest Payment Date, at maturity, by acceleration, repurchase, redemption or otherwise, interest on the overdue principal of and interest (to the extent permitted by law), if any, on the Notes and Guarantees and performance of all other obligations under this Indenture, shall be secured as provided in the Security Documents. The Trustee, the Security Agent, the Issuers and the Guarantors hereby agree that, subject to Permitted Collateral Liens, the Security Agent shall hold the Collateral in trust for the benefit of the Trustee and all of the Holders pursuant to the terms of the Security Documents, and shall act as mortgagee or security holder under all mortgages or standard securities, beneficiary under all deeds of trust and as secured party under the applicable security agreements. |
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(b) Each Holder of the Notes, by its acceptance thereof, consents and agrees to the terms of the Security Documents (including, without limitation, the provisions providing for foreclosure and release of Collateral) as the same may be in effect or may be amended from time to time in accordance with their terms and authorizes and directs the Security Agent to perform its respective obligations and exercise its rights thereunder in accordance therewith. |
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(c) The Trustee, the Security Agent and each Holder, by accepting the Notes and the Guarantees, acknowledges that, as more fully set forth in the Security Documents, the Collateral as now or hereafter constituted shall be held for the benefit of all the Holders under the Security Documents, and that the Lien of this Indenture and the Security Documents in respect of the Security Agent and the Holders is subject to and qualified and limited in all respects by the Security Documents and actions that may be taken thereunder. |
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(d) For the purposes of the Security Documents governed by Italian law, each Holder of the Notes and the Trustee appoints the Security Agent: |
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(i) to act as his/its agent in connection with this Indenture; |
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(ii) to act as its trustee in relation to any Security Documents; and |
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(iii) in addition to the foregoing, and to the extent necessary - with the express consent pursuant to article 1395 of the Italian Civil Code - to be its mandatario con rappresentanza and common representative to act on its/their behalf in connection with any actions to be taken in |
respect of any Security Document which is expressed to be governed by Italian law, and to take any action in relation to the creation, perfection, maintenance, enforcement and release of the security created thereunder. |
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(e) Notwithstanding (i) anything to the contrary contained in this Indenture, the Security Documents, Notes, Guarantees or any other instrument governing, evidencing or relating to any Debt, (ii) the time, order or method of attachment of any Liens, (iii) the time or order of filing or recording of financing statements or other documents filed or recorded to perfect any Lien upon any Collateral, (iv) the time of taking possession or control over any Collateral or (v) the rules for determining priority under any law of any relevant jurisdiction governing relative priorities of secured creditors: |
(1)the Liens will rank equally and ratably with all valid, enforceable and perfected Liens, whenever granted upon any present or future Collateral, but only to the extent such Liens are permitted under this Indenture to exist and to rank equally and ratably with the Notes and Guarantees; and
(2)all proceeds of the Collateral applied under the Security Documents shall be allocated and distributed as set forth in the Security Documents, subject to the Intercreditor Agreement and any Additional Intercreditor Agreement.
Each Holder, by accepting a Note, shall be deemed (i) to have authorized the Trustee and the Security Agent to enter into the Security Documents and the Intercreditor Agreement and any Additional Intercreditor Agreement, in each case in compliance with this Indenture and (ii) to be bound thereby. Each Holder, by accepting a Note, appoints the Trustee or the Security Agent, as the case may be, as its agent under the Security Documents, the Intercreditor Agreement and any Additional Intercreditor Agreement and authorizes it to act as such.
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(a) Upon (i) confirmation in writing from the Trustee of the full and final payment and performance of all obligations under this Indenture and the Notes; (ii) confirmation in writing from the Trustee of the surrender of all outstanding Notes issued under this Indenture to the Trustee for cancellation; (iii) the release of the Collateral in accordance with the terms of this Section 11.04 and the Security Documents; or (iv) any other release of the Collateral as security for obligations of the Issuers or a Guarantor under this Indenture, the Security Agent shall disclaim and give up any and all rights it has in or to the Collateral, and any rights it has under the Security Documents and shall no longer be deemed to hold the Lien in the Collateral for the benefit of the Holders. |
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(b) Liens granted by a Subsidiary Guarantor (and the Liens, if any, over the Capital Stock of such Subsidiary Guarantor) will be automatically and unconditionally released (and, upon request of the Issuers or any Guarantor, the Security Agent shall (without notice to, or vote or consent of, any Holder but with notice to the Trustee) take such actions as shall be required to release such Liens): |
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(i) upon any sale or disposition of (A) Capital Stock of a Subsidiary Guarantor following which such Subsidiary Guarantor is no longer a Restricted Subsidiary or, (B) all or substantially all of the properties and assets of a Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary that does not violate Section 4.09; |
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(ii) in the event that all of the Capital Stock of such Subsidiary Guarantor is sold or otherwise disposed of pursuant to an enforcement of the security over the Capital Stock of such Subsidiary Guarantor under the applicable Security Document(s) in accordance with the terms of the Intercreditor Agreement or any Additional Intercreditor Agreement; |
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(iii) upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary; |
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(iv) in the circumstances set forth in Section 5.01(c); |
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(v) as described in Article Nine; and |
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(vi) with respect to mortgages or similar security interests in real property (other than in England and Wales or in any state of the United States) upon the replacement and/or refinancing of the Existing Secured Notes. |
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(c) Upon request of the Issuers or any Guarantor, in connection with any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition of assets or property permitted by this Indenture (including, without limitation, Sections 4.09, 4.13 and 4.14 hereof), the Security Agent shall (without notice to, or vote or consent of, any Holder but with notice to the Trustee) take such actions as shall be required (as more particularly described in this Section 11.04(f)) to release its Security Interest in any Collateral being disposed in such disposition, to the extent necessary or advisable to permit consummation of such disposition in accordance with this Indenture and the Security Documents and the Trustee shall receive full payment therefor from the Issuers for any costs incurred thereby. Upon the request of the Issuers, the Security Agent shall (without notice to, or vote or consent of, any Holder but with notice |
to the Trustee) take such actions as shall be required (as more particularly described in Section 11.04(f)) to release its Security Interest in any real property (other than any real property in England and Wales or any state of the United States, in connection with the replacement or refinancing of the Existing Secured Notes in accordance with Section 11.04(b)(vi). |
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(d) Upon the request of the Issuers, the Security Agent shall (without notice to, or vote or consent of, any Holder but with notice to the Trustee) take such actions as shall be required (as more particularly described in Section 11.04(f)) to release its Security Interest in any assets constituting inventories and accounts receivable (and other assets customarily relating to inventories and accounts receivable such as insurance proceeds, books and records and other assets) in connection with the granting of a security interest in such Collateral to secure new Debt (where such Debt and security interest are permitted by Section 4.06(b)(2), as certified to the Trustee in an Officer’s Certificate and an Opinion of Counsel which certification and opinion shall be conclusive); provided that if the Parent Guarantor or any of its Restricted Subsidiaries owning such assets grants a Silent Second Lien over such assets in favor of any other Debt, they shall also grant a Silent Second Lien in such released Collateral in favor of the Security Agent (on its own behalf and on behalf of the Holders); provided further that upon the release of such Silent Second Liens securing such other Debt, the Liens in favor of the Security Agent (on its own behalf and on behalf of the Trustee for the holders of the Notes) shall be automatically released. The Issuers shall provide the Security Agent and the Trustee with an Opinion of Counsel regarding the validity and enforceability of any Silent Second Lien granted pursuant to the foregoing, which opinion may be subject to exceptions, limitations and exclusions reasonably determined by such counsel to be necessary or appropriate, in light of applicable law in the relevant jurisdiction. |
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(e) Any release of Collateral made in compliance with this Section 11.04 shall not be deemed to impair the Lien under the Security Documents or the Collateral thereunder in contravention of the provisions of this Indenture or the Security Documents. |
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(f) In the event that the Issuers or any Guarantor seeks to release Collateral, the Issuers or such Guarantor shall deliver an Officer’s Certificate (which the Trustee and Security Agent shall rely upon in connection with such release) to the Trustee and the Security Agent setting forth that the specified release complies with the terms of this Indenture. Upon receipt of the Officer’s Certificate and if so requested by the Issuers or such Guarantor, the Security Agent shall execute, deliver or acknowledge any necessary or proper instruments of termination, satisfaction or release to evidence the release of any Collateral permitted to be released pursuant to this Indenture. |
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(a) Without prejudice to the provisions of this Indenture and the Security Documents and for the purpose of preserving the initial and continuing validity of the security rights granted and to be granted by the Issuers and each Guarantor to the Security Agent, an amount equal to and in the same currency of the obligations under the Notes and the Guarantees from time to time due by the Issuers or such Guarantor in accordance with the terms and conditions of the Notes and Guarantees, including for the avoidance of doubt, the limitations set out under Section 10.04, shall be owing as a separate and independent obligation of the Issuers and each Guarantor to the Security Agent (such payment undertaking and the obligations and liabilities which are the result thereof the “Parallel Debt”). |
(b)The Issuers, each Guarantor and the Security Agent acknowledge that (i) for this purpose the Parallel Debt constitutes undertakings, obligations and liabilities of the Issuers and each Guarantor to the Security Agent under this Indenture and the Security Documents which are separate and independent from, and without prejudice to, the corresponding obligations under the Notes and Guarantees which the Issuers or such Guarantor has to the Holders and (ii) that the Parallel Debt represents the Security Agent’s
own claims to receive payment of the Parallel Debt; provided that the total amount which may become due under the Parallel Debt shall never exceed the total amount which may become due under the Notes and Guarantees; provided, further, that the Security Agent shall exercise its rights with respect to the Parallel Debt solely in accordance with this Indenture and the Security Documents (including the Intercreditor Agreement and any Additional Intercreditor Agreement).
(c)Every payment of monies made by the Issuers or a Guarantor to the Security Agent shall (conditionally upon such payment not subsequently being avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, insolvency, liquidation or similar laws of general application) be in satisfaction pro tanto of the covenant by the Issuers or such Guarantor contained in Section 11.05(a); provided that if any such payment as is mentioned above is subsequently avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, liquidation or similar laws of general application the Security Agent shall be entitled to receive the amount of such payment from the Issuers or such Guarantor and the Issuers or such Guarantor shall remain liable to perform the relevant obligation and the relevant liability shall be deemed not to have been discharged.
(d) Subject to the provision in Section 11.05(c), but notwithstanding any of the other provisions of this clause (d):
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(i) the total amount due and payable as Parallel Debt under this Section 11.05 shall be decreased to the extent that the Issuers or a Guarantor shall have paid any amounts to the Security Agent or to the Trustee on behalf of the Holders or any of them to reduce the outstanding principal amount of the Notes or the Security Agent or the Trustee on behalf of the Holders otherwise receives any amount in payment of the Notes and the Guarantees; and |
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(ii) to the extent that the Issuers or a Guarantor shall have paid any amounts to the Trustee or to the Security Agent under the Parallel Debt or the Trustee or the Security Agent shall have otherwise received monies in payment of the Parallel Debt, the total amount due and payable under the Notes and the Guarantees shall be decreased as if said amounts were received directly in payment of the Notes and Guarantees. |
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(a) Notwithstanding anything to the contrary in this Indenture, upon the sale or disposition directly or indirectly of the Capital Stock of the U.S. Issuer pursuant to an enforcement by the Security Agent in accordance with the Intercreditor Agreement (or any Additional Intercreditor Agreement) and this Indenture (a “Holdings USA Disposition”), the obligations of the U.S. Issuer under the Notes and this Indenture will be automatically and unconditionally released (and thereupon shall terminate and be discharged and be of no further effect); provided that each other guarantee by the U.S. Issuer in respect of any Credit Facility and any other capital markets debt of the Parent Guarantor or any of its subsidiaries has been released (or is released simultaneously upon such Holdings USA Disposition). Upon a Holdings USA Disposition, the Irish Issuer shall be the sole Issuer under the Notes and this Indenture, and the Notes and this Indenture shall remain in full force and effect and any reference in this indenture, the Notes and the Intercreditor Agreement (or any Additional Intercreditor Agreement) to the “Issuers” or the U.S. Issuer shall be deemed to be references only to the “Issuer” or the Irish Issuer, mutatis mutandis. |
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(b) The Parent Guarantor shall publish a notice of a Holdings USA Disposition described in Section 12.01(a) in accordance with Section 12.02 and, so long as the rules of Euronext Dublin so require, notify such exchange of a Holdings USA Disposition. |
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(c) The U.S. Issuer agrees, and each Holder by accepting a Note agrees, that the provisions of this Section 12.01 are for the benefit of and enforceable by the Security Agent. |
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(a) Any notice or communication shall be in writing and delivered in person or mailed by first class mail or sent by facsimile transmission addressed as follows: |
if to the Irish Issuer:
Ardagh House
South County Business Park
Leopardstown
Dublin 18
D18 PX68
Ireland
Attention: Finance Director
Facsimile: +353 1 668 3416
if to the U.S. Issuer:
The Corporation Trust Company
1209 Orange Street
Wilmington, Delaware 19801
United States
if to the Guarantors:
Ardagh Group S.A.
56 rue Charles Martel
L 2134 Luxembourg
Grand Duchy of Luxembourg
With copies to:
Shearman & Sterling
9 Appold Street
London, EC2A 2AP
United Kingdom
Telephone: +44 (0)20 7655 5000
Facsimile: +44 (0)20 7655 5500
Attention: Mr. Trevor Ingram
if to the Trustee, Principal Paying Agent or Transfer Agent:
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
(i) for the Trustee and Security Agent:
Fax: +44 20 7500 5877
Attention: The Directors, Agency & Trust
(ii) for the Principal Paying Agent:
Fax: +353 1 622 2210
Attention: PPA desk
(iii) for the Transfer Agent:
Fax: +353 1 622 2031
Attention: Transfer Agent
The Issuers, the Guarantors or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
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(b) Notices regarding the Notes shall be: |
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(i) delivered to Holders electronically or mailed by first-class mail, postage paid, and, if and so long as the Notes are listed on Euronext Dublin and the rules and regulations of such exchange so require, published in a newspaper having a general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) in the case of certificated Notes, mailed to each Holder by first-class mail at such Holder’s respective address as it appears on the registration books of the Registrar. |
Notices given by first-class mail shall be deemed given five calendar days after mailing and notices given by publication shall be deemed given on the first date on which publication is made. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
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(c) If and so long as the Notes are listed on any securities exchange instead of or in addition to Euronext Dublin, notices shall also be given in accordance with any applicable requirements of such alternative or additional securities exchange. |
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(d) If and so long as the Notes are represented by Global Notes, notices may be given by delivery of the relevant notices to DTC, Euroclear and Clearstream for communication to entitled account holders in substitution for the mailing required under Section 12.02(b)(i). |
an Officer’s Certificate in form reasonably satisfactory to the Trustee stating that, in the opinion of the signer, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and
an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
Any Officer’s Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless the officer signing such certificate knows, or in the exercise of reasonable care should know, that such Opinion of Counsel with respect to the matters upon which such Officer’s Certificate is based are erroneous. Any Opinion of Counsel may be based and may state that it is so based, insofar as it relates to factual matters, upon certificates of public officials or an Officer’s Certificate stating that the information with respect to such factual matters is in the possession of the Issuers, unless the counsel signing such Opinion of Counsel knows, or in the exercise of reasonable care should know, that the Officer’s Certificate with respect to the matters upon which such Opinion of Counsel is based are erroneous.
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SECTION 12.04. Statements Required in Certificate or Opinion. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: |
a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and
a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.
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SECTION 12.07. Governing Law. THIS INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. |
The Issuers acknowledge and accept that, notwithstanding any other provision of this Indenture or any other agreement, arrangement or understanding between the parties:
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(a) any Liability may be subject to the exercise of Write-down and Conversion Powers by the Resolution Authority; |
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(b) the Issuers will be bound by the effect of any application of any Write-down and Conversion Powers in relation to any Liability and in particular (but without limitation) by: |
(1)any reduction in the principal amount, in full or in part, or outstanding amount due (including any accrued but unpaid interest) in respect of any Liability; and
(2)any conversion of all or part of any Liability into ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person; that may result from any exercise of any Write-down and Conversion Powers in relation to any Liability;
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(c) the terms of this Indenture and the rights of the Issuers hereunder may be varied, to the extent necessary, to give effect to any exercise of any Write-down and Conversion Powers in relation to any Liability and the Issuers will be bound by any such variation; |
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(d) ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person may be issued to or conferred on an Issuer as a result of any exercise of any Write-down and Conversion Powers in relation to any Liability. |
For purposes of this Section 12.15:
"Liability" means any liability of Citigroup Global Markets Europe AG to the Issuers arising under or in connection with this Indenture;
“Resolution Authority” means the German Federal Agency for Financial Markets Stabilisation (Bundesanstalt für Finanzmarktstabilisierung), or any other body which has authority to exercise any Write-down and Conversion Powers; and
“Write-down and Conversion Powers” means any write-down, conversion, transfer, modification or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in Germany, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time, including but not limited to the German Recovery and Resolution Act (Sanerungs-und Abwicklungsgesetz) as amended from time to time, and the instruments, rules and standards created thereunder, pursuant to which:
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(a) any obligation of Citigroup Global Markets Europe AG (or other affiliate of such entity) can be reduced, cancelled, modified or converted into shares, other securities or other obligations of such entity or any other person (or suspended for a temporary period); and |
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(b) any right in a contract governing an obligation of Citigroup Global Markets Europe AG may be deemed to have been exercised. |
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
ARDAGH PACKAGING FINANCE PLC,
as Issuer
By:
Name:
Title:
ARDAGH HOLDINGS USA INC.
as Issuer
By:
Name:
Title:
ARDAGH GROUP S.A.,
as Parent Guarantor
By:
Name:
Title:
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Security Agent, Principal Paying Agent and Transfer Agent
By:
Name:
Title:
CITIGROUP GLOBAL MARKETS
EUROPE AG,
as Registrar
By:
Name:
Title:
By:
Name:
Title:
Schedule I
AGREED SECURITY PRINCIPLES
1.agreed security principles
The guarantees and security to be provided under and in connection with this Indenture will be given in accordance with the security and guarantee principles set out in this Schedule I (the “Agreed Security Principles”). Notwithstanding anything contained in the Agreed Security Principles, so long as the Existing Secured Notes remain outstanding, the security and guarantees provided in respect of the Notes shall be the same as those provided in respect of the Existing Secured Notes.
2.GENERAL PRINCIPLES
2.1The Agreed Security Principles embody a recognition by all parties that there may be certain legal and practical difficulties in obtaining effective guarantees and security from the Parent Guarantor and its Subsidiaries (collectively, the “Group”) in certain jurisdictions. In particular:
(a)mandatory law provisions, general legal, statutory and constitutional documents’ limitations, capital maintenance, the prohibition of an intervention threatening the existence of a German member of the Group (Verstoß gegen das Verbot des existenzvernichtenden Eingriffs), financial assistance, corporate benefit, fraudulent preference, “thin capitalization” rules, “transfer pricing”, retention of title claims, exchange control restrictions, employee consultation or approval requirements, regulatory restrictions and similar principles may limit the ability of a member of the Group to provide a guarantee or security or may require that the guarantee and/or security be limited by an amount or otherwise. If any such limit applies, the guarantees and security provided will be limited to the maximum amount which the relevant member of the Group may provide having regard to applicable law;
(b)a factor in determining whether or not security shall be taken is the applicable cost which shall not be disproportionate to the benefit to the Holders (or any other beneficiary of the security) of obtaining such security. For these purposes “cost” includes, but is not limited to, income or corporate tax cost, registration taxes payable on the creation or enforcement or for the continuance of any security, notary costs, stamp duties, out-of-pocket expenses, and other fees and expenses directly incurred by the relevant grantor of security or any of its direct or indirect owners, subsidiaries or affiliates;
(c)unless each consent required by law, statute, the terms of any applicable contract, instrument or constitutional document or otherwise from the minority shareholders in, or any relevant corporate body of, any member of the Group which is not wholly owned (directly or indirectly) by another member of the Group is obtained, such Group member
shall not be required to grant guarantees and security provided that the relevant company and the Parent Guarantor have used reasonable efforts to obtain such consent;
(d)guarantees should not be granted and security shall not be created or perfected to the extent that it would result in a risk to the directors or officers of the relevant grantor of such guarantee and security of contravention of any statutory duty in such capacity or their fiduciary duties and/or which could reasonably be expected to result in personal, civil or criminal liability on the part of any such director or officer;
(e)any assets subject to third party arrangements (including shareholder agreements or joint venture agreements) which would prevent or prohibit those assets from being subject to legal, valid, binding and enforceable security will be excluded from the security created by any relevant security document; provided that the relevant member of the Group has used reasonable efforts to obtain any necessary consent or waiver if the asset is material, it being acknowledged that reasonable efforts will not require the payment by the Parent Guarantor or the relevant company of any monetary consideration (other than nominal amounts or expenses) to obtain any such consent or waiver;
(f)the maximum guaranteed or secured amount may be limited to minimize stamp duty, notarization, registration or other applicable fees, taxes and duties where the benefit of increasing the guaranteed or secured amount is disproportionate to the level of such fee, taxes and duties;
(g)where a class of assets to be secured includes material and immaterial assets, if the cost of granting security over the immaterial assets is disproportionate to the benefit of such security, security will be granted over the material assets only;
(h)the giving of a guarantee, the granting of security or the perfection of the security granted will not be required if:
(i)it would have a material adverse effect on the ability of the relevant member of the Group to conduct its operations and business in the ordinary course as otherwise permitted by the Indenture; or
(ii)it would have a material adverse effect on the tax arrangements of the Group or any member of the Group,
provided that, in each case, the relevant member of the Group shall use reasonable efforts to overcome such obstacle. The secured and guaranteed obligations will be limited where necessary to prevent any material additional tax liability of any member of the Group;
(i)other than as provided for in Section 11.04(b)(vi) of this Indenture, and save for security granted by a Guarantor organized under the laws of England & Wales, Ireland, The Netherlands, or any state of the United States of America, security shall only be granted over the Capital Stock of each Guarantor;
(j)no fixed security shall be required to be given over bank accounts, inventory, receivables or intellectual property rights where satisfactory floating security (or equivalent in the relevant jurisdiction) can be taken over such assets; and
(k)no perfection action will be required in jurisdictions in which a Guarantor is not located.
3.guarantees and security
3.1It is agreed between the parties to this Indenture that subject to the other provisions of this Schedule I, no individual item of security shall be granted unless on or about the same time, security of an equivalent nature is granted to or for the benefit of Law Debenture Trust Company, in its capacity as trustee for certain of the Existing Secured Notes.
3.2In the case of guarantees and security to be granted by a Guarantor incorporated in The Netherlands or France, if the relevant Guarantor has at least 50 employees, and/or over any Dutch or French assets, if the relevant entity granting such pledge has at least 50 employees, or any other jurisdictions or assets requiring receipt of advice from a works council, such guarantees and security shall not be granted until neutral or positive advice is received from any relevant works council and such work council shall be allowed to assist to the relevant board meeting of such Guarantor or relevant entity granting such pledge.
3.3In the case of guarantees and security to be granted by a Guarantor incorporated in The Netherlands or France and/or over any Dutch or French assets, or any other jurisdictions or assets requiring receipt of advice from a works council, such guarantees and security shall not be granted until neutral or positive advice is received from any relevant works council.
3.4Each guarantee will be an upstream, cross-stream and downstream guarantee and each guarantee and security will be for all liabilities of the relevant members of the Group under the Indenture in accordance with, and subject to, the requirements of the Agreed Security Principles in each relevant jurisdiction.
3.5No subsidiary of the Parent Guarantor that is a Controlled Foreign Corporation (as defined in the United States Internal Revenue Code of 1986, as amended) (or that is a disregarded entity for U.S. federal income tax purposes owned by any such Controlled Foreign Corporation) shall be required to give a guarantee or pledge any of its assets (including shares in a subsidiary) as security for an obligation of a United States Person (as defined in the United States Internal Revenue Code of 1986, as amended). Furthermore, not more than 65% of the total combined voting power of all classes of shares entitled to vote of any such subsidiary may be pledged directly or indirectly as security for an obligation of a United States Person. These principles also apply with respect to any entity that becomes a United States Person and/or a Controlled Foreign Corporation following any guarantee or pledge of assets or shares.
3.6No Subsidiary of the Parent Guarantor shall guarantee the New Unsecured Notes unless such Subsidiary provides a Guarantee.
4.TERMS OF SECURITY DOCUMENTS
4.1Security shall (to the extent legally possible, subject to the general principles above) be created in favor of the Security Agent, the Trustee and the Holders or the Security Agent on behalf of or as trustee for the Trustee and the Holders (as considered appropriate by counsel to the Security Agent), to secure all of the obligations of the party giving the relevant security as well as all liabilities under the Indenture and the Notes (to the extent permitted by local law).
4.2The security documents should only operate to create security rather than to impose new commercial obligations. Accordingly, representations shall not be included and undertakings (such as in respect of insurance, maintenance of assets, information or the payment of costs) shall be strictly limited to those necessary for the creation or perfection of the security, will not unreasonably interfere with the normal running of the business and shall not be included to the extent the subject matter thereof is the same as a corresponding undertaking in the Indenture and shall not operate so as to prevent transactions which are otherwise permitted under the Indenture or to require additional consents or authorizations or to impose commercial obligations.
4.3The following principles will be reflected in the terms of any security taken as part of this transaction:
(a)security will not be enforceable in respect of the Notes until an Event of Default has occurred in respect of which the Notes are being accelerated (a “Declared Default”);
(b)information, such as lists of assets, will be provided if, in the opinion of counsel to the Security Agent, these are required by local law to be provided to perfect or register the security or to ensure the security can be enforced and, unless in the opinion of counsel to the Security Agent required to be provided by local law more frequently, be provided annually or, following an Event of Default which is continuing, on the Security Agent’s reasonable request; and
(c)each of the Trustee, the Security Agent and the Holders should only be able to exercise any power of attorney granted to it under the security documents following a Declared Default.
5.bank accounts
5.1If a member of the Group grants security over its bank accounts it shall be free to deal with those accounts in the ordinary course of its business until a Declared Default has occurred. No control agreements will be required in respect of any account located in the United States of America.
5.2If required by local law to perfect the security, notice of the security will be served on the account bank within 10 Business Days of the security being granted and the relevant member of the Group shall use its reasonable efforts to obtain an acknowledgement of that notice within 20 business days of service. If the relevant member of the Group has used its reasonable efforts but has not been able to obtain acknowledgement its obligation to obtain acknowledgement shall cease on the expiry of that 20 Business Day period. Irrespective of whether notice of the security is required for perfection, if the service of notice would prevent the relevant member of the Group from using a bank account in the ordinary course of its business no notice of security shall be served until a Declared Default has occurred. There will be no restriction on the closure of any bank accounts which are no longer required by the Group.
5.3Any security over bank accounts shall be subject to any prior security interests in favor of the account bank which are created either by law or in the standard terms and conditions of the account bank. The notice of security may request these are waived or subordinated by the account bank but the Guarantor shall not be required to change its banking arrangements if these security interests are not waived or subordinated or only partially waived or subordinated.
5.4If required under local law, security over bank accounts will be registered subject to the general principles set out in these Agreed Security Principles.
6.REAL ESTATE
6.1No security will be given over real property unless it has a value in excess of €20,000,000 (twenty million euro) and the secured parties under any Credit Facility have been granted a lien on such real property.
6.2No security will be given over leasehold interests unless there is an option to acquire the freehold and where the freehold will have a value in excess of the amount referred to in paragraph 6.1 above in which case security will be given at the time of the exercise of that option.
6.3There will be no obligation to investigate title, provide surveys or other insurance or environmental due diligence.
6.4A Guarantor will be under no obligation to obtain any landlord consent required to grant security over its real estate, but only to investigate the possibility thereof.
6.5Until the release provided for in Section 11.04(b)(vi) of this Indenture, with respect to any real estate located in Germany, a submission to immediate foreclosure relating to any real estate security only in relation to 5% of the amount secured under the relevant land charge is to be provided. A Guarantor will be under no obligation to notify any insurer of its real estate relating to any real estate security.
7.FIXED ASSETS
7.1If a member of the Group grants security over its fixed assets it shall be free to deal with those assets in the ordinary course of its business until a Declared Default has occurred.
7.2If required under local law, security over fixed assets will be registered subject to the general principles set out in these Agreed Security Principles.
8.INSURANCE POLICIES
8.1If required by local law to perfect the security or to exclude the possibility that the debtor pays to the relevant member of the Group with discharging effect, notice of the security will be served on the insurance provider within 10 Business Days of the security being granted and the relevant member of the Group shall use its reasonable efforts to obtain an acknowledgement of that notice within 20 Business Days of service. If the relevant member of the Group has used its reasonable efforts but has not been able to obtain acknowledgement its obligation to obtain acknowledgement shall cease on the expiry of that 20 Business Day period.
8.2No loss payee or other endorsement shall be made on the insurance policy.
9.INTELLECTUAL PROPERTY
9.1If a member of the Group grants security over its intellectual property it shall be free to deal with those assets in the ordinary course of its business (including, without limitation, allowing its
intellectual property to lapse if no longer material to its business and if permitted by the Indenture) until a Declared Default has occurred.
9.2No security shall be granted over any intellectual property which cannot be secured under the terms of the relevant licensing agreement. No notice shall be prepared or given to any third party from whom intellectual property is licensed until a Declared Default has occurred.
9.3The security documents may provide for the applications of registration as may be required under local law for the applicable registration of the security over intellectual property to be provided by the relevant member of the Group in its jurisdiction of incorporation and any central registry only and subject to the general principles set out in these Agreed Security Principles; provided that no registration of the transfer of the relevant intellectual property to the Holders, the Trustee or the Security Agent shall be required under the relevant security documents.
10.INTERCOMPANY RECEIVABLES
10.1If a member of the Group grants security over its intercompany receivables it shall be free to deal with those receivables in the ordinary course of its business until a Declared Default has occurred.
10.2If required by local law to perfect the security or to exclude the possibility that the debtor pays to the relevant member of the Group with discharging effect, notice of the security will be served on the relevant lender within 10 Business Days of the security being granted.
10.3If required under local law security over intercompany receivables will be registered subject to the general principles set out in these Agreed Security Principles.
11.TRADE RECEIVABLES and inventory
11.1If a member of the Group grants security over its trade receivables and/or its inventory it shall be free to deal with those receivables and/or inventory in the ordinary course of its business until a Declared Default has occurred.
11.2No notice of security may be prepared or served until the occurrence of a Declared Default.
11.3No security will be granted over any trade receivables which cannot be secured under the terms of the relevant contract.
11.4If required under local law, security over trade receivables and inventory will be registered subject to the general principles set out in these Agreed Security Principles.
11.5Any list of trade receivables required shall not include details of the underlying contracts to the extent not required to perfect the security transfer and make the receivables identifiable (bestimmbar) or to ensure the security can be enforced.
12.SHARES / PARTNERSHIP INTEREST
12.1The security document will be governed by the laws of the person whose shares or partnership interests are being secured and not by the law of the country of the person granting the security.
12.2Until a Declared Default has occurred, the securing person will be permitted to retain and to exercise voting rights to any shares or partnership interests pledged by it in a manner which does not adversely affect the validity or enforceability of the security or cause an Event of Default to occur and the company whose shares or partnership interests have been pledged will, subject to the terms of the Indenture, be permitted to pay dividends.
12.3Where customary, as soon as reasonably practicable following execution of the share pledge, the share certificate and (where available and customary) a stock transfer form executed in blank will be provided to the Security Agent and where required by law the share certificate or shareholders register will be endorsed or written up and the endorsed share certificate or a copy of the written up register provided to the Security Agent.
13.RELEASE OF SECURITY
Unless required by local law the circumstances in which the security shall be released should not be dealt with in individual security documents but, if so required, shall, except to the extent required by local law, be the same as those set out in the Indenture or the Intercreditor Agreement or any Additional Intercreditor Agreement and not require any further consent by the Security Agent, the Trustee or any Holder.
14.Jurisdictions
14.1The guarantees and security to be provided under and in connection with the Notes and the Indenture will only be granted by members of the Group organized under the laws of the following jurisdictions:
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(i) |
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Australia; |
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(ii) |
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Denmark; |
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(iii) |
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France; |
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(iv) |
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Germany; |
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(v) |
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Guernsey; |
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(vi) |
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Ireland; |
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(vii) |
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Italy; |
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(viii) |
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New Zealand; |
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(ix) |
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Norway; |
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(x) |
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Poland; |
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(xi) |
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Sweden; |
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(xii) |
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The Netherlands; |
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(xiii) |
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The United Kingdom; and |
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(xiv) |
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The United States of America. |
15.SECURITY DOCUMENTATION
Subject to the Agreed Security Principles, each security agreement referred to will be substantially the same as that in place immediately prior to the Issue Date (with such modifications as required, but only to the extent necessary, to reflect any change in law since the date of the relevant security agreement).
Exhibit A-1
[FORM OF FACE OF DOLLAR NOTE]
ARDAGH PACKAGING FINANCE PLC
ARDAGH HOLDINGS USA INC.
If Regulation S Dollar Global Note – CUSIP Number [●]/ISIN [●]
If Restricted Dollar Global Note – CUSIP Number [●]/ISIN [●]
No. [ ]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE AND IS REGISTERED IN THE NAME OF DTC OR A NOMINEE OF DTC OR A SUCCESSOR DEPOSITARY. THIS NOTE IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]
THIS SECURITY HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON U.S. PERSON ACQUIRING THIS NOTE IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED SECURITIES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE SECURITIES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO AN ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO EACH ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN $200,000.
BY ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN), THE PURCHASER OR HOLDER WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT (A) IT IS NOT AND FOR SO LONG AS IT HOLDS THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT BE (I) AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), THAT
IS SUBJECT TO TITLE I OF ERISA, (II) A “PLAN” AS DEFINED IN AND SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) AN ENTITY OR ACCOUNT WHOSE UNDERLYING ASSETS ARE DEEMED TO INCLUDE THE ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR OTHER PLAN SUBJECT TO SECTION 4975 OF THE CODE OR (IV) A NON U.S., GOVERNMENTAL, CHURCH OR OTHER BENEFIT PLAN WHICH IS SUBJECT TO ANY NON U.S. OR U.S. FEDERAL, STATE, OR LOCAL LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF TITLE I OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) (EACH OF (I), (II), (III) AND (IV), A “PLAN”), (B) NO ASSETS OF A PLAN HAVE BEEN USED BY IT TO ACQUIRE THIS NOTE (OR ANY INTEREST HEREIN) OR (C) ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH AN EXEMPTION IS NOT AVAILABLE OR VIOLATION OF ANY SIMILAR LAW, AND NONE OF THE ISSUER, THE INITIAL PURCHASERS NOR ANY OF THEIR RESPECTIVE AFFILIATES IS ITS FIDUCIARY IN CONNECTION WITH THE PURCHASE AND HOLDING OF THIS NOTE.
[IN THE CASE OF ADDITIONAL REGULATION S NOTES: THIS NOTE SHALL BEAR THE TEMPORARY CUSIP AND TEMPORARY ISIN NUMBERS INDICATED ON THIS NOTE UNTIL THE DAY THAT IS 40 DAYS AFTER [●], AFTER WHICH DATE THE PERMANENT CUSIP AND PERMANENT ISIN NUMBERS INDICATED ON THIS NOTE SHALL BE BORNE.]
4.125% SENIOR SECURED NOTE DUE 2026
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc., a Delaware corporation, for value received, jointly and severally promise to pay to [●] or registered assigns the principal sum of $[●] (as such amount may be increased or decreased as indicated in Schedule A (Schedule of Principal Amount) of this Note) on August 15, 2026.
From [ ] or from the most recent Interest Payment Date to which interest has been paid or provided for, cash interest on this Note will accrue at 4.125%, payable semi-annually on May 15 and November 15 of each year, beginning on [●], to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the Business Day immediately preceding such Interest Payment Date, as the case may be.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. have caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARDAGH PACKAGING FINANCE PLC
By:
Name:
Title:Authorized Signatory
ARDAGH HOLDINGS USA INC.
By:
Name:
Title:Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
4.125% Senior Secured Note Due 2026
1.Interest
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc. a Delaware corporation (each corporation, and such respective successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuers”), for value received, promises to pay interest on the principal amount of this Note from [●] at the rate per annum of 4.125%. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a)All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, a Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes, after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b)None of the Issuers or Guarantors will, however, pay Additional Amounts in respect or on account of:
(i)any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee);
(ii)any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing
Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii)any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv)any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note or any Guarantee;
(v)any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi)any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii)any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii)any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(ix)any combination of the foregoing.
(c)The Issuers and the Guarantors, if the applicable withholding agents, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d)At least 30 calendar days prior to each date on which any payment under or with respect to this Note or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 of
the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts.
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or such Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or such Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuers and the Guarantors (and not otherwise in the possession of the Trustee) to enable the determination of the amount of any withholding taxes attributable to any particular Holder(s).
(e)Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this or any other Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable.
(f)This paragraph 2 will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on this or any other Note (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuers shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next Interest Payment Date even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuers shall pay principal and interest in dollars in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuers by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent, and Citigroup Global Markets Europe AG will act as Registrar. The Issuers or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuers issued this Note under an indenture dated as of August 12, 2019 (the “Indenture”), among, inter alios, the Issuers, Ardagh Group S.A., as parent guarantor (the “Parent Guarantor”), Citibank, N.A., London Branch, as trustee (the “Trustee”) and Citibank, N.A., London Branch, as security agent (the “Security Agent”). The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuers, the Guarantors and their Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting the Parent Guarantor and its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Parent Guarantor and the Restricted Subsidiaries, Change of Control and Liens.
6.Optional Redemption
(a)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may on any one or more occasions redeem up to 40% of the aggregate principal amount of the Dollar Notes at a Redemption Price of 104.125% of their principal amount, plus accrued and unpaid interest, if any, to (but excluding) the Redemption Date (subject to the rights of holders of Dollar Notes on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds from one or more Public Equity Offerings. The Issuers may only do this, however, if (i) at least 60% of the aggregate principal amount of the applicable series of Dollar Notes that were initially issued would remain outstanding immediately after the proposed redemption; and (ii) the redemption occurs within 120 days after the closing of such Public Equity Offering.
(b)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may also redeem all or part of the Notes at a Redemption Price equal to 100% of the principal amount of the Notes being redeemed plus the Notes Applicable Redemption Premium and accrued and unpaid interest to the Redemption Date.
“Notes Applicable Redemption Premium” means the greater of:
(1)1.0% of the principal amount of the Dollar Notes; and
(2)the excess of:
(i)the present value at such Redemption Date of (x) the Redemption Price of such Dollar Note at August 15, 2022 (such Redemption Price being set forth in the table appearing below in clause (c)), plus (y) all required interest payments due on such Note through August 15, 2022 (excluding accrued but unpaid interest), computed
using a discount rate equal to the Treasury Rate as of such Redemption Date plus 50 basis points; over
(ii)the outstanding principal amount of such Dollar Note.
“Treasury Rate” means, as of any Redemption Date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the Redemption Date) of the yield to maturity of United States Treasury securities with a constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 Redemption Date to August 15, 2022; provided, however, that if the period from the Redemption Date to August 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Redemption Date to August 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
(c)At any time on or after August 15, 2022 and prior to maturity, upon not less than 10 nor more than 60 days’ notice, the Issuers may redeem all or part of the Notes. These redemptions will be in amounts of $1,000 or integral multiples thereof at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to the Redemption Date, if redeemed during the 12‑month period commencing on August 15 of the years set forth below (subject to the right of holders of record on the relevant regular Record Date that is prior to the Redemption Date to receive interest due on an interest payment date).
Year |
Redemption Price Notes |
2022............................................................................................................................................... |
|
2023............................................................................................................................................... |
|
2024 and thereafter....................................................................................................................... |
|
(d)At any time and from time to time prior to August 15, 2022, the Issuers may, at their option, during each calendar year redeem up to 10% of the original principal amount of the Dollar Notes (including the original principal amount of any Additional Dollar Notes), upon giving notice as described under Article 3 of the Indenture at a Redemption Price equal to 103.000% of the principal amount of the Dollar Notes so redeemed, plus accrued and unpaid interest and Additional Amounts, if any, to but excluding the Redemption Date.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent.
7.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuers, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the
Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to (but excluding) the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing sub-clauses (a) and (b), a “Change in Tax Law”), the Issuers would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in paragraph 2), with respect to the Relevant Taxing Jurisdiction, which the Issuers cannot avoid by the use of reasonable measures available to the Issuers. Prior to the giving of any notice of redemption pursuant to this paragraph 7, the Issuers shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuers taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuers of recognized standing qualified under the laws of the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuers has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on Holders of the Notes.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuers would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
8.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than $200,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of $1,000 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
9.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuers or the Parent Guarantor shall offer to purchase on the Change of Control Purchase Date all or any part (equal to $200,000 or an integral multiple of $1,000 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject
to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuers and the Parent Guarantor shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to paragraph 6 or paragraph 7 of this Note. The Issuers shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders of the Notes must follow to accept the Change of Control Offer.
When the aggregate amount of Excess Proceeds exceeds the greater of $100,000,000 and 1.5% of Total Assets, the Parent Guarantor or the Issuers shall, within 20 Business Days, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in the Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of $1,000 with respect to the Dollar Notes) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase.
To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the Parent Guarantor may use the amount of such Excess Proceeds not used to purchase Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero.
10.Denominations
The Notes (including this Note) are in denominations of $200,000 and integral multiples of $1,000 in excess thereof of principal amount at maturity. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
11.Unclaimed Money
All moneys paid by the Issuers or the Guarantors to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such principal, premium or interest has become due and payable may be repaid to the Issuers or the Guarantors, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuers or the Guarantors for payment thereof.
12.Discharge and Defeasance
Subject to certain conditions, the Issuers at any time may terminate some or all of its obligations and the obligations of the Guarantors under this Note and each other Note, the Guarantees and the Indenture
if the Issuers irrevocably deposit with the Trustee dollars or U.S. Government Securities for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
13.Amendment, Supplement and Waiver
(a)(i) The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Guarantors and the Trustee may modify, amend or supplement the Indenture, any Guarantee or this Note and each other Note and the Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent), the Guarantors and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants in the Indenture and in this Note and each other Note; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of Article Five shall apply mutatis mutandis);
(B)to add to the covenants of the Issuers, any Guarantor or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon this Note and each other Note, as applicable, in the Indenture, in this Note and each other Note or in any Guarantees;
(C)to cure any ambiguity, or to correct or supplement any provision in the Indenture, this Note and each other Note or any Guarantees that may be defective or inconsistent with any other provision in the Indenture, this Note and each other Note or any Guarantee or make any other provisions with respect to matters or questions arising under the Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Guarantees, the Security Documents, or the Notes to any provision of the “Description of the Secured Notes” section of the Offering Memorandum to the extent that such provision in the “Description of the Secured Notes” was intended to be a verbatim recitation of a provision of the Indenture, the Guarantees, the Security Documents or the Notes;
(E)to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in the Indenture and to add a Subsidiary Guarantor or other guarantor under the Indenture (which will require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s));
(F)to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent under the Indenture or any Security Document;
(G)to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to the Indenture or otherwise to release Collateral from the Liens pursuant to the Indenture and the Security Documents when permitted or required
by the Indenture, the Security Documents and/or the Intercreditor Agreement or to modify the Security Documents and/or the Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding obligations that are permitted to be secured by Liens pari passu with the Notes under the Security Documents pursuant to the terms of the Indenture; or
(H)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii)The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under the Indenture may supplement the Indenture to add a Subsidiary Guarantor or other guarantor under the Indenture, in each case without notice to or consent of any Holder.
(iii)In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
(b)Except as provided in paragraph 13(c) of this Note and Section 6.04 of the Indenture, respectively, and without prejudice to paragraph 13(a) of this Note, the Issuers, the Guarantors and the Trustee may:
(i)modify, amend or supplement the Indenture, the Security Documents or this Note and the other Notes; or
(ii)waive compliance by the Issuers with any provision of the Indenture, the Security Documents or this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes); provided that, if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required;
(c)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 9.01 of the Indenture, may:
(i)change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(ii)reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(iii)change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(iv)impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(v)reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(vi)modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(vii)make any change to the Intercreditor Agreement (or any Additional Intercreditor Agreement) or any provisions of the Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders or directly or indirectly release the Liens on the Collateral except as permitted by the Indenture, the Intercreditor Agreement (or any Additional Intercreditor Agreement) and the Security Documents; or
(viii)make any change in Section 4.12 of the Indenture that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(d) The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
14.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in clauses (ix) and (x) of Section 6.01(a) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note, the other Notes or the Security Documents except as provided in the Indenture and subject to the Intercreditor Agreement and any Additional Intercreditor Agreement. The Trustee and the Security Agent may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations and the Intercreditor Agreement (and any Additional Intercreditor Agreement), the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee and the Security Agent in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its
consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
15.Ranking
This Note and the other Notes will be general obligations of each Issuer and will rank senior in right of payment to any and all of each Issuer’s existing and future Debt that is subordinated in right of payment to the Notes, rank equally in right of payment with all of each Issuer’s existing and future Debt that is not subordinated in right of payment to the Notes, and be structurally subordinated to all existing and future indebtedness of the Parent Guarantor’s Subsidiaries that do not provide Guarantees.
16.Security
This Note and the other Notes will be secured by the Security Interests in the Collateral, subject to Permitted Collateral Liens. Reference is made to the Indenture for terms relating to such security, including the release, termination and discharge thereof. The Security Documents and the Collateral will be administered by the Security Agent (or in certain circumstances a sub-agent) pursuant to the Security Documents, including the Intercreditor Agreement or any Additional Intercreditor Agreement for the benefit of all Holders and holders of certain Debt permitted to be secured on the Collateral. The Issuers shall not be required to make any notation on this Note to reflect any grant of such security or any such release, termination or discharge. Each Holder, by accepting a Note, shall be deemed to have agreed to and accepted the terms and conditions of the Intercreditor Agreement or any Additional Intercreditor Agreement (whether then entered into or entered into in the future pursuant to the provisions described herein).
17.Trustee Dealings with the Issuers
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers, the Guarantors or any of their Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
18.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuers or the Guarantors shall not have any liability for any obligations of the Issuers or the Guarantors under this Note, the other Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
19.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
20.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
21.ISIN and CUSIP Numbers
The Issuers may cause ISIN and CUSIP numbers to be printed on the Notes, and if so the Trustee shall use ISIN and CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
22.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuers) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuers or any of their respective Affiliates, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Parent Guarantor or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have
certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuers reasonably request to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or Section 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of $200,000 or any integral multiple of $1,000 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
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[FORM OF FACE OF EURO NOTE]
ARDAGH PACKAGING FINANCE PLC
ARDAGH HOLDINGS USA INC.
If Regulation S Euro Global Note – Common Code [●] / ISIN [●]
If Restricted Euro Global Note – Common Code [●] / ISIN [●]
No. [ ]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF CITIVIC NOMINEES LIMITED AS NOMINEE FOR CITIBANK EUROPE PLC (THE “COMMON DEPOSITARY”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CITIBANK EUROPE PLC, AS COMMON DEPOSITARY OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY (AND ANY PAYMENT IS MADE TO CITIVIC NOMINEES LIMITED OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CITIVIC NOMINEES LIMITED, HAS AN INTEREST HEREIN.
TRANSFERS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF THE COMMON DEPOSITARY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS CERTIFICATE AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF THIS CERTIFICATE TO REFLECT ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS CERTIFICATE SHALL BE DEEMED, BY THE ACCEPTANCE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
THIS SECURITY HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON U.S. PERSON ACQUIRING THIS NOTE IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED SECURITIES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE SECURITIES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO AN ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO EACH ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN €100,000.
BY ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN), THE PURCHASER OR HOLDER WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT (A) IT IS NOT AND FOR SO LONG AS IT HOLDS THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT BE (I) AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), THAT IS SUBJECT TO TITLE I OF ERISA, (II) A “PLAN” AS DEFINED IN AND SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) AN ENTITY OR ACCOUNT WHOSE UNDERLYING ASSETS ARE DEEMED TO INCLUDE THE ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR OTHER PLAN SUBJECT TO SECTION 4975 OF THE CODE OR (IV) A NON U.S., GOVERNMENTAL, CHURCH OR OTHER BENEFIT PLAN WHICH IS SUBJECT TO ANY NON U.S. OR U.S. FEDERAL, STATE, OR LOCAL LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF TITLE I OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) (EACH OF (I), (II), (III) AND (IV), A “PLAN”), (B) NO ASSETS OF A PLAN HAVE BEEN USED BY IT TO ACQUIRE THIS NOTE (OR ANY INTEREST HEREIN) OR (C) ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH AN EXEMPTION IS NOT AVAILABLE OR VIOLATION OF ANY SIMILAR LAW, AND NONE OF THE ISSUER, THE INITIAL PURCHASERS NOR ANY OF THEIR RESPECTIVE AFFILIATES IS ITS FIDUCIARY IN CONNECTION WITH THE PURCHASE AND HOLDING OF THIS NOTE.
[IN THE CASE OF ADDITIONAL REGULATION S NOTES: THIS NOTE SHALL BEAR THE TEMPORARY COMMON CODES AND TEMPORARY ISIN NUMBERS INDICATED ON THIS NOTE UNTIL THE DAY THAT IS 40 DAYS AFTER [●], AFTER WHICH DATE THE PERMANENT COMMON CODE AND PERMANENT ISIN NUMBERS INDICATED ON THIS NOTE SHALL BE BORNE.]
2.125% SENIOR SECURED NOTE DUE 2026
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc., a Delaware corporation, for value received, jointly and severally promise to pay to [●] or registered assigns the principal sum of €[●] (as such amount may be increased or decreased as indicated in Schedule A (Schedule of Principal Amount) of this Note) on August 15, 2026.
From [ ] or from the most recent Interest Payment Date to which interest has been paid or provided for, cash interest on this Note will accrue at 2.125%, payable semi-annually on May 15 and November 15 of each year, beginning on [●], to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the Business Day preceding such Interest Payment Date, as the case may be.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. have caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARDAGH PACKAGING FINANCE PLC
By:
Name:
Title:Authorized Signatory
ARDAGH HOLDINGS USA INC.
By:
Name:
Title:Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
2.125% Senior Secured Note Due 2026
1.Interest
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc. a Delaware corporation (each corporation, and such respective successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuers”), for value received, promises to pay interest on the principal amount of this Note from [●] at the rate per annum of 2.125%. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a)All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, a Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes, after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b)None of the Issuers or Guarantors will, however, pay Additional Amounts in respect or on account of:
(i)any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee);
(ii)any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing
Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii)any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv)any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note or any Guarantee;
(v)any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi)any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii)any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii)any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(ix)any combination of the foregoing.
(c)The Issuers and the Guarantors, if the applicable withholding agents, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d)At least 30 calendar days prior to each date on which any payment under or with respect to this Note or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 of
the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts.
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or such Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or such Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuers and the Guarantors (and not otherwise in the possession of the Trustee) to enable the determination of the amount of any withholding taxes attributable to any particular Holder(s).
(e)Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this or any other Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable.
(f)This paragraph 2 will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on this or any other Note (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuers shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next Interest Payment Date even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuers shall pay principal and interest in euros in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuers by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent and Citigroup Global Markets Europe AG will act as Registrar. The Issuers or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuers issued this Note under an indenture dated as of August 12, 2019 (the “Indenture”), among, inter alios, the Issuers, Ardagh Group S.A., as parent guarantor (the “Parent Guarantor”), Citibank, N.A., London Branch, as trustee (the “Trustee”) and Citibank, N.A., London Branch, as security agent (the “Security Agent”). The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuers, the Guarantors and their Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting the Parent Guarantor and its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Parent Guarantor and the Restricted Subsidiaries, Change of Control and Liens.
6.Optional Redemption
(a)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may on any one or more occasions redeem up to 40% of the aggregate principal amount of the Euro Notes at a Redemption Price of 102.125% of their principal amount, plus accrued and unpaid interest, if any, to (but excluding) the Redemption Date (subject to the rights of holders of Euro Notes on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds from one or more Public Equity Offerings. The Issuers may only do this, however, if (i) at least 60% of the aggregate principal amount of the applicable series of Euro Notes that were initially issued would remain outstanding immediately after the proposed redemption; and (ii) the redemption occurs within 120 days after the closing of such Public Equity Offering.
(b)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may also redeem all or part of the Euro Notes at a Redemption Price equal to 100% of the principal amount of the Euro Notes being redeemed plus the Notes Applicable Redemption Premium and accrued and unpaid interest to the Redemption Date.
“Notes Applicable Redemption Premium” means, with respect to the Euro Note on any Redemption Date, the greater of:
(1)1.0% of the principal amount of the Euro Notes; and
(2)the excess of:
(i)the present value at such Redemption Date of (x) the Redemption Price of such Euro Note at August 15, 2022 (such Redemption Price being set forth in the table appearing below in clause (c)), plus (y) all required interest payments due on such Euro Note through August 15, 2022 (excluding accrued but unpaid
interest), computed using a discount rate equal to the Bund Rate as of such Redemption Date plus 50 basis points; over
(ii)the outstanding principal amount of such Euro Note.
“Bund Rate” means, with respect to any Redemption Date, the rate per annum equal to the equivalent yield to maturity as of such Redemption Date of the Comparable German Bund Issue, assuming a price for the Comparable German Bund Issue (expressed as a percentage of its principal amount) equal to the Comparable German Bund Price for such Redemption Date, where:
(1)“Comparable German Bund Issue” means the German Bundesanleihe security selected by any Reference German Bund Dealer as having a fixed maturity most nearly equal to the period from such Redemption Date to August 15, 2022, and that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of euro denominated corporate debt securities in a principal amount approximately equal to the then outstanding principal amount of the Euro Notes and of a maturity most nearly equal to August 15, 2022; provided that if the period from such Redemption Date to August 15, 2022 is less than one year, a fixed maturity of one year shall be used;
(2)“Comparable German Bund Price” means, with respect to any Redemption Date, the average of the Reference German Bund Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Reference German Bund Dealer Quotations, or if an Issuer obtains fewer than four such Reference German Bund Dealer Quotations, the average of all such quotations;
(3)“Reference German Bund Dealer” means any dealer of German Bundesanleihe securities appointed by an Issuer (and notified to the Trustee); and
(4)“Reference German Bund Dealer Quotations” means, with respect to each Reference German Bund Dealer and any Redemption Date, the average as determined by an Issuer of the bid and offered prices for the Comparable German Bund Issue (expressed in each case as a percentage of its principal amount) quoted in writing to an Issuer by such Reference German Bund Dealer at 3:30 p.m. Frankfurt, Germany time on the third Business Day preceding such Redemption Date.
(c)At any time on or after August 15, 2022 and prior to maturity, upon not less than 10 nor more than 60 days’ notice, the Issuers may redeem all or part of the Euro Notes. These redemptions will be in amounts of €1,000 or integral multiples thereof with respect to the Euro Notes at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to the Redemption Date, if redeemed during the 12‑month period commencing on August 15 of the years set forth below (subject to the right of holders of record on the relevant regular Record Date that is prior to the Redemption Date to receive interest due on an interest payment date).
Year |
Redemption Price Euro Notes |
2022......................................................................................................................................................... |
|
2023......................................................................................................................................................... |
|
2024 and thereafter................................................................................................................................. |
|
(d)At any time and from time to time prior to August 15, 2022, the Issuers may, at their option, during each calendar year redeem up to 10% of the original principal amount of the Euro Notes (including the original principal amount of any Additional Euro Notes), upon giving notice as described under Article 3 of the Indenture at a Redemption Price equal to 103.000% of the principal amount of the Euro Notes so redeemed, plus accrued and unpaid interest and Additional Amounts, if any, to but excluding the Redemption Date.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent.
7.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuers, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to (but excluding) the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing clauses (a) and (b), a “Change in Tax Law”), the Issuers would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in paragraph 2), with respect to the Relevant Taxing Jurisdiction, which the Issuers cannot avoid by the use of reasonable measures available to the Issuers. Prior to the giving of any notice of redemption pursuant to this paragraph, the Issuers shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuers taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuers of recognized standing qualified under the laws of the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuers has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on Holders of the Notes.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuers would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
8.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than €100,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of €1,000 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
9.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuers or the Parent Guarantor shall offer to purchase on the Change of Control Purchase Date all or any part (equal to €100,000 or an integral multiple of €1,000 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuers and the Parent Guarantor shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to paragraph 6 or paragraph 7 of this Note. The Issuers shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders of the Notes must follow to accept the Change of Control Offer.
When the aggregate amount of Excess Proceeds exceeds the greater of $100,000,000 and 1.5% of Total Assets, the Parent Guarantor or the Issuers shall, within 20 Business Days, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in the Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of €1,000) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase.
To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the Parent Guarantor may use the amount of such Excess Proceeds not used to purchase Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the
principal amount or accreted value of such Pari Passu Debt tendered by each holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero.
10.Denominations
The Notes (including this Note) are in denominations of €100,000 and integral multiples of €1,000 in excess thereof of principal amount at maturity. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
11.Unclaimed Money
All moneys paid by the Issuers or the Guarantors to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such principal, premium or interest has become due and payable may be repaid to the Issuers or the Guarantors, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuers or the Guarantors for payment thereof.
12.Discharge and Defeasance
Subject to certain conditions, the Issuers at any time may terminate some or all of its obligations and the obligations of the Guarantors under this Note and each other Note, the Guarantees and the Indenture if the Issuers irrevocably deposit with the Trustee euro or European Government Obligations for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
13.Amendment, Supplement and Waiver
(a)(i) The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Guarantors and the Trustee may modify, amend or supplement the Indenture, any Guarantee or this Note and each other Note and the Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent), the Guarantors and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants in the Indenture and in this Note and each other Note; provided that such successor person would have been permitted to so succeed in a transaction that would have complied with Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of such Article Five shall apply mutatis mutandis);
(B)to add to the covenants of the Issuers, any Guarantor or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon this Note and each other Note, as applicable, in the Indenture, in this Note and each other Note or in any Guarantees;
(C)to cure any ambiguity, or to correct or supplement any provision in the Indenture, this Note and each other Note or any Guarantees that may be defective or inconsistent with any other provision in the Indenture, this Note and each other Note or any Guarantee or make any other provisions with respect to matters or questions arising under the Indenture, the Notes or any
Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Guarantees, the Security Documents, or the Notes to any provision of the “Description of the Secured Notes” section of the Offering Memorandum to the extent that such provision in the “Description of the Secured Notes” was intended to be a verbatim recitation of a provision of the Indenture, the Guarantees, the Security Documents or the Notes;
(E)to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in the Indenture and to add a Subsidiary Guarantor or other guarantor under the Indenture (which will require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s));
(F)to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent under the Indenture or any Security Document;
(G)to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to the Indenture or otherwise to release Collateral from the Liens pursuant to the Indenture and the Security Documents when permitted or required by the Indenture, the Security Documents and/or the Intercreditor Agreement or to modify the Security Documents and/or the Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding obligations that are permitted to be secured by Liens pari passu with the Notes under the Security Documents pursuant to the terms of the Indenture; or
(H)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii)The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under the Indenture may supplement the Indenture to add a Subsidiary Guarantor or other guarantor under the Indenture, in each case without notice to or consent of any Holder.
(iii)In formulating its opinion on such matters, the Trustee shall be entitled to require and rely conclusively on an Opinion of Counsel and an Officer’s Certificate.
(b)Except as provided in paragraph 13(c) of this Note and Section 6.04 of the Indenture, respectively, and without prejudice to paragraph 13(a) of this Note, the Issuers, the Guarantors and the Trustee may:
(i)modify, amend or supplement the Indenture, the Security Documents or this Note and the other Notes; or
(ii)waive compliance by the Issuers with any provision of the Indenture, the Security Documents or this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes); provided that, if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required;
(c)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 9.01 of the Indenture, may:
(i)change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(ii)reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(iii)change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(iv)impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(v)reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(vi)modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(vii)make any change to the Intercreditor Agreement (or any Additional Intercreditor Agreement) or any provisions of the Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders or directly or indirectly release the Liens on the Collateral except as permitted by the Indenture, the Intercreditor Agreement (or any Additional Intercreditor Agreement) and the Security Documents; or
(viii)make any change in Section 4.12 of the Indenture that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(d) The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent.
A consent to any amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
14.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in clauses (ix) and (x) of Section 6.01(a) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note, the other Notes or the Security Documents except as provided in the Indenture and subject to the Intercreditor Agreement and any Additional Intercreditor Agreement. The Trustee and the Security Agent may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations and the Intercreditor Agreement (and any Additional Intercreditor Agreement), the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee and the Security Agent in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
15.Ranking
This Note and the other Notes will be general obligations of each Issuer and will rank senior in right of payment to any and all of each Issuer’s existing and future Debt that is subordinated in right of payment to the Notes, rank equally in right of payment with all of each Issuer’s existing and future Debt that is not subordinated in right of payment to the Notes, and be structurally subordinated to all existing and future indebtedness of the Parent Guarantor’s Subsidiaries that do not provide Guarantees.
16.Security
This Note and the other Notes will be secured by the Security Interests in the Collateral, subject to Permitted Collateral Liens. Reference is made to the Indenture for terms relating to such security, including the release, termination and discharge thereof. The Security Documents and the Collateral will be administered by the Security Agent (or in certain circumstances a sub-agent) pursuant to the Security Documents, including the Intercreditor Agreement or any Additional Intercreditor Agreement for the benefit of all Holders and holders of certain Debt permitted to be secured on the Collateral. The Issuers shall not be required to make any notation on this Note to reflect any grant of such security or any such release, termination or discharge. Each Holder, by accepting a Note, shall be deemed to have agreed to and accepted the terms and conditions of the Intercreditor Agreement or any Additional Intercreditor Agreement (whether then entered into or entered into in the future pursuant to the provisions described herein).
17.Trustee Dealings with the Issuers
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers, the Guarantors or any of their Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
18.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuers or the Guarantors shall not have any liability for any obligations of the Issuers or the Guarantors under this Note, the other Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
19.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
20.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
21.ISIN and Common Code Numbers
The Issuers may cause ISIN or Common Code numbers to be printed on the Notes, and if so the Trustee shall use ISIN and Common Code numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
22.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuers) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuers or any of their respective Affiliates, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Parent Guarantor or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have
certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuers reasonably request to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or Section 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of €100,000 or any integral multiple of €1,000 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
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EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM RESTRICTED
GLOBAL NOTE TO REGULATION S GLOBAL NOTE.*
Transfers pursuant to Section 2.06(b)(ii) of the Indenture
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: [4.125][2.125]% Senior Secured Notes due 2026 (the “Notes”)
Reference is hereby made to the Indenture dated as of August 12, 2019 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee, and Citibank, N.A., London Branch, as Security Agent. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to [€][$]____________ aggregate principal amount of Notes that are held as a beneficial interest in the form of the Restricted Global Note ([CUSIP No. [●]][Common Code No. [●]]; ISIN No: [●]) with [DTC/the Common Depository] in the name of [name of transferor] (the “Transferor”). The Transferor has requested an exchange or transfer of such beneficial interest for an equivalent beneficial interest in the Regulation S Global Note ([CUSIP No. [●]][Common Code No. [●]]; ISIN No: [●]).
In connection with such request, the Transferor does hereby certify that such transfer has been effected in accordance with the transfer restrictions set forth in the Notes and:
(a)with respect to transfers made in reliance on Regulation S (“Regulation S”) under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), does certify that:
(i)the offer of the Notes was not made to a person in the United States;
(ii)either (i) at the time the buy order is originated the transferee is outside the United States or the Transferor and any person acting on its behalf reasonably believe that the transferee is outside the United States or; (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market described in paragraph (b) of Rule 902 of Regulation S and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States
(iii)no directed selling efforts have been made in the United States by the Transferor, an affiliate thereof or any person their behalf in contravention of the requirements of Rule 903 or 904 of Regulation S, as applicable;
(iv)the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act; and
(v)the Transferor is not an Issuer, a distributor of the Notes, an affiliate of an Issuer or any such distributor (except any officer or director who is an affiliate solely by virtue of holding such position) or a person acting on behalf of any of the foregoing.
(b)with respect to transfers made in reliance on Rule 144 the Transferor certifies that the Notes are being transferred in a transaction permitted by Rule 144 under the U.S. Securities Act.
You, the Issuers, the Guarantors and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
____________________
*If the Note is a Definitive Note, appropriate changes need to be made to the form of this transfer certificate.
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM REGULATION S
GLOBAL NOTE TO RESTRICTED GLOBAL NOTE
Transfers pursuant to Section 2.06(b)(iii) of the Indenture
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: [4.125][2.125]% Senior Secured Notes due 2026 (the “Notes”)
Reference is hereby made to the Indenture dated as of August 12, 2019 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee, and Citibank, N.A., London Branch, as Security Agent. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to [€][$]__________ aggregate principal amount at maturity of Notes that are held in the form of the Regulation S Global Note with [DTC/the Common Depositary] ([CUSIP No.: [●]] [Common Code No. [●]]; ISIN No. [●]) in the name of [name of transferor] (the “Transferor”) to effect the transfer of the Notes in exchange for an equivalent beneficial interest in the Restricted Global Note ([CUSIP No.: [●]][Common Code No. [●]]; ISIN No. [●]).
In connection with such request, and in respect of such Notes the Transferor does hereby certify that such Notes are being transferred in accordance with the transfer restrictions set forth in the Notes and that:
CHECK ONE BOX BELOW:
☐the Transferor is relying on Rule 144A under the Securities Act for exemption from such Act’s registration requirements; it is transferring such Notes to a person it reasonably believes is a QIB as defined in Rule 144A that purchases for its own account, or for the account of a qualified institutional buyer, and to whom the Transferor has given notice that the transfer is made in reliance on Rule 144A and the transfer is being made in accordance with any applicable securities laws of any state of the United States; or
☐the Transferor is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act, subject to the Issuers’ and the Trustee’s right prior to any such offer, sale or transfer to require the delivery of an Opinion of Counsel, certification and/or other information satisfactory to each of them.
You, the Issuers, the Guarantors, and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
Exhibit 99.6
ARDAGH PACKAGING FINANCE PLC
and
ARDAGH HOLDINGS USA INC.
as Issuers,
ARDAGH Group S.A.,
as Parent Guarantor,
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Principal Paying Agent and Transfer Agent
and
CITIGROUP GLOBAL MARKETS Europe AG,
as Registrar
_____________________________
Indenture
Dated as of August 12, 2019
_____________________________
5.250% SENIOR NOTES DUE 2027
TABLE OF CONTENTS
Page
ARTICLE One DEFINITIONS AND INCORPORATION BY REFERENCE.....................................................................................1
SECTION 1.01.Definitions...............................................................................................................................1
SECTION 1.02.Other Definitions...................................................................................................................30
SECTION 1.03.Rules of Construction.............................................................................................................31
SECTION 1.04.Financial Calculations.............................................................................................................32
SECTION 1.05.Agency of Irish Issuer.............................................................................................................33
ARTICLE Two THE NOTES.............................................................................................................................................33
SECTION 2.01.The Notes.............................................................................................................................33
SECTION 2.02.Execution and Authentication.................................................................................................34
SECTION 2.03.Registrar, Transfer Agent and Paying Agent.............................................................................34
SECTION 2.04.Paying Agent to Hold Money.................................................................................................35
SECTION 2.05.Holder Lists...........................................................................................................................36
SECTION 2.06.Transfer and Exchange...........................................................................................................36
SECTION 2.07.Replacement Notes...............................................................................................................38
SECTION 2.08.Outstanding Notes.................................................................................................................39
SECTION 2.09.Notes Held by Issuers...........................................................................................................39
SECTION 2.10.Certificated Notes.................................................................................................................39
SECTION 2.11.Cancellation.........................................................................................................................40
SECTION 2.12.Defaulted Interest.................................................................................................................40
SECTION 2.13.Computation of Interest.........................................................................................................41
SECTION 2.14.ISIN and CUSIP Numbers.......................................................................................................41
SECTION 2.15.Issuance of Additional Notes.................................................................................................41
ARTICLE Three REDEMPTION; OFFERS TO PURCHASE.....................................................................................................41
SECTION 3.01.Right of Redemption.............................................................................................................41
SECTION 3.02.Notices to Trustee.................................................................................................................41
SECTION 3.03.Selection of Notes to Be Redeemed.......................................................................................41
SECTION 3.04.Notice of Redemption...........................................................................................................42
SECTION 3.05.Deposit of Redemption Price.................................................................................................43
SECTION 3.06.Payment of Notes Called for Redemption...............................................................................43
SECTION 3.07.Notes Redeemed in Part.......................................................................................................43
ARTICLE Four COVENANTS.........................................................................................................................................44
SECTION 4.01.Payment of Notes.................................................................................................................44
SECTION 4.02.Corporate Existence...............................................................................................................44
SECTION 4.03.Maintenance of Properties.....................................................................................................44
SECTION 4.04.Insurance.............................................................................................................................44
SECTION 4.05.Statement as to Compliance...................................................................................................44
SECTION 4.06.Limitation on Debt.................................................................................................................45
SECTION 4.07.Limitation on Liens.................................................................................................................49
SECTION 4.08.Limitation on Restricted Payments.........................................................................................49
SECTION 4.09.Limitation on Sale of Certain Assets.......................................................................................54
SECTION 4.10.Limitation on Transactions with Affiliates.................................................................................56
SECTION 4.11.Purchase of Notes upon a Change of Control...........................................................................57
SECTION 4.12.Additional Amounts...............................................................................................................59
SECTION 4.13.Additional Intercreditor Agreements.....................................................................................62
SECTION 4.14.Additional Subsidiary Guarantees...........................................................................................62
SECTION 4.15.Limitation on Guarantees of Debt by Restricted Subsidiaries.....................................................63
SECTION 4.16.Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries.........64
SECTION 4.17.Designation of Unrestricted and Restricted Subsidiaries...........................................................66
SECTION 4.18.Payment of Taxes and Other Claims.......................................................................................67
SECTION 4.19.Reports to Holders.................................................................................................................67
SECTION 4.20.Further Instruments and Acts.................................................................................................68
SECTION 4.21.Limitation on Layered Debt.....................................................................................................68
SECTION 4.22.Suspension of Covenants.......................................................................................................68
ARTICLE Five CONSOLIDATION, MERGER AND SALE OF ASSETS.......................................................................................68
SECTION 5.01.Consolidation, Merger and Sale of Assets...............................................................................68
SECTION 5.02.Successor Substituted...........................................................................................................70
ARTICLE Six DEFAULTS AND REMEDIES.........................................................................................................................70
SECTION 6.01.Events of Default...................................................................................................................70
SECTION 6.02.Acceleration.........................................................................................................................72
SECTION 6.03.Other Remedies...................................................................................................................73
SECTION 6.04.Waiver of Past Defaults.........................................................................................................74
SECTION 6.05.Control by Majority...............................................................................................................74
SECTION 6.06.Limitation on Suits.................................................................................................................74
SECTION 6.07.Unconditional Right of Holders to Bring Suit for Payment.........................................................75
SECTION 6.08.Collection Suit by Trustee.......................................................................................................75
SECTION 6.09.Trustee May File Proofs of Claim.............................................................................................75
SECTION 6.10.Application of Money Collected.............................................................................................76
SECTION 6.11.Undertaking for Costs...........................................................................................................76
SECTION 6.12.Restoration of Rights and Remedies.......................................................................................76
SECTION 6.13.Rights and Remedies Cumulative...........................................................................................76
SECTION 6.14.Delay or Omission Not Waiver...............................................................................................76
SECTION 6.15.Record Date.........................................................................................................................77
SECTION 6.16.Waiver of Stay or Extension Laws...........................................................................................77
ARTICLE Seven TRUSTEE.............................................................................................................................................77
SECTION 7.01.Duties of Trustee...................................................................................................................77
SECTION 7.02.Certain Rights of Trustee.......................................................................................................78
SECTION 7.03.Individual Rights of Trustee...................................................................................................80
SECTION 7.04.Disclaimer of Trustee.............................................................................................................81
SECTION 7.05.Compensation and Indemnity.................................................................................................81
SECTION 7.06.Replacement of Trustee.........................................................................................................81
SECTION 7.07.Successor Trustee by Merger.................................................................................................82
SECTION 7.08.[Reserved]...........................................................................................................................83
SECTION 7.09.Eligibility; Disqualification.....................................................................................................83
SECTION 7.10.Appointment of Co-Trustee...................................................................................................83
SECTION 7.11.Resignation of Agents...........................................................................................................84
SECTION 7.12.Agents General Provisions.....................................................................................................84
ARTICLE Eight DEFEASANCE; SATISFACTION AND DISCHARGE.........................................................................................86
SECTION 8.01.Issuers’ Option to Effect Defeasance or Covenant Defeasance...................................................86
SECTION 8.02.Defeasance and Discharge.....................................................................................................86
SECTION 8.03.Covenant Defeasance...........................................................................................................86
SECTION 8.04.Conditions to Defeasance.......................................................................................................87
SECTION 8.05.Satisfaction and Discharge of Indenture...................................................................................88
SECTION 8.06.Survival of Certain Obligations...............................................................................................89
SECTION 8.07.Acknowledgment of Discharge by Trustee...............................................................................89
SECTION 8.08.Application of Trust Money.....................................................................................................89
SECTION 8.09.Repayment to Issuers...........................................................................................................89
SECTION 8.10.Indemnity for Government Securities.....................................................................................90
SECTION 8.11.Reinstatement.....................................................................................................................90
ARTICLE Nine AMENDMENTS AND WAIVERS.................................................................................................................90
SECTION 9.01.Without Consent of Holders...................................................................................................90
SECTION 9.02.With Consent of Holders.......................................................................................................91
SECTION 9.03.Effect of Supplemental Indentures.........................................................................................92
SECTION 9.04.Notation on or Exchange of Notes...........................................................................................92
SECTION 9.05.[Reserved]...........................................................................................................................93
SECTION 9.06.Notice of Amendment or Waiver.............................................................................................93
SECTION 9.07.Trustee to Sign Amendments, Etc...........................................................................................93
SECTION 9.08.Additional Voting Terms; Calculation of Principal Amount.........................................................93
ARTICLE Ten GUARANTEE...........................................................................................................................................93
SECTION 10.01.Notes Guarantees.................................................................................................................93
SECTION 10.02.Subrogation...........................................................................................................................95
SECTION 10.03.Release of Subsidiary Guarantees...........................................................................................95
SECTION 10.04.Limitation and Effectiveness of Guarantees.............................................................................96
SECTION 10.05.Notation Not Required...........................................................................................................96
SECTION 10.06.Successors and Assigns...........................................................................................................96
SECTION 10.07.No Waiver.............................................................................................................................96
SECTION 10.08.Modification.........................................................................................................................96
ARTICLE Eleven SUBORDINATION...............................................................................................................................96
SECTION 11.01.Agreement to Subordinate.....................................................................................................96
SECTION 11.02.Liquidation, Dissolution, Bankruptcy.......................................................................................97
SECTION 11.03.Payment Blockage.................................................................................................................97
SECTION 11.04.Trustee Entitled to Rely.........................................................................................................98
SECTION 11.05.Trustee to Effectuate Subordination of Each Subsidiary Guarantee; Intercreditor Agreement.....98
SECTION 11.06.Trustee Not Fiduciary for the Holders of Senior Debt...............................................................99
SECTION 11.07.Reliance on Subordination Provisions; Amendments...............................................................99
SECTION 11.08.Trustee’s Compensation Not Prejudiced...............................................................................100
SECTION 11.09.Subrogation to Rights of Holders of Senior Debt...................................................................100
SECTION 11.10.Provisions Solely to Define Relative Rights...........................................................................100
SECTION 11.11.Notice to Trustee...............................................................................................................100
SECTION 11.12.No Suspense of Remedies...................................................................................................101
SECTION 11.13.Trust Moneys Not Subordinated.........................................................................................101
ARTICLE Twelve MISCELLANEOUS.............................................................................................................................101
SECTION 12.01.Release of U.S. Issuer’s Obligations.....................................................................................101
SECTION 12.02.Notices.................................................................................................................................102
SECTION 12.03.Certificate and Opinion as to Conditions Precedent...............................................................104
SECTION 12.04.Statements Required in Certificate or Opinion.....................................................................104
SECTION 12.05.Rules by Trustee, Paying Agent and Registrar.......................................................................104
SECTION 12.06.Legal Holidays...................................................................................................................104
SECTION 12.07.Governing Law...................................................................................................................105
SECTION 12.08.Jurisdiction.......................................................................................................................105
SECTION 12.09.No Recourse Against Others...............................................................................................105
SECTION 12.10.Successors.........................................................................................................................105
SECTION 12.11.Multiple Originals...............................................................................................................106
SECTION 12.12.Table of Contents, Cross-Reference Sheet and Headings.......................................................106
SECTION 12.13.Severability.......................................................................................................................106
SECTION 12.14.Currency Indemnity...........................................................................................................106
SECTION 12.15.Contractual Recognition of Bail-In.......................................................................................106
Schedules
Schedule I-Agreed Security Principles
Exhibits
Exhibit A-Form of Notes
Exhibit B-Form of Transfer Certificate for Transfer from Restricted Global Note to Regulation S Global Note
Exhibit C-Form of Transfer Certificate for Transfer from Regulation S Global Note to Restricted Global Note
INDENTURE dated as of August 12, 2019 among Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland (the “Irish Issuer”), Ardagh Holdings USA Inc., a Delaware corporation (the “U.S. Issuer” and, together with the Irish Issuer, the “Issuers”), Ardagh Group S.A. (the “Parent Guarantor”), Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as transfer agent (the “Transfer Agent”) and Citigroup Global Markets Europe AG, as Registrar.
RECITALS OF THE ISSUERS AND THE PARENT GUARANTOR
The Issuers have duly authorized the execution and delivery of this Indenture to provide for the issuance of their 5.250% Senior Notes due 2027 issued on the date hereof (the “Original Notes”) and any additional notes that may be issued after the Issue Date under this Indenture (the “Additional Notes”). The Original Notes and Additional Notes together are the “Notes”. The Issuers and the Parent Guarantor have received good and valuable consideration for the execution and delivery of this Indenture. The Parent Guarantor will derive substantial direct and indirect benefits from the issuance of the Notes. All necessary acts and things have been done to make (i) the Notes, when duly issued and executed by the Issuers and authenticated and delivered hereunder, the legal, valid and binding obligations of the Issuers and (ii) this Indenture (including the Guarantees included herein) a legal, valid and binding agreement of the Issuers and the Parent Guarantor in accordance with the terms of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:
“Acquired Debt” means Debt of a Person:
(a)existing at the time such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Parent Guarantor or any Restricted Subsidiary; or
(b)assumed in connection with the acquisition of assets from any such Person;
provided, in each case, that such Debt was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary or such acquisition, as the case may be.
Acquired Debt will be deemed to be incurred on the date the acquired Person becomes a Restricted Subsidiary or the date of the related acquisition of assets from any such Person.
“Affiliate” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Agreed Security Principles” means the Agreed Security Principles as set forth on Schedule I hereto.
“Applicable Law” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Asset Sale” means any sale, issuance, conveyance, transfer, lease or other disposition (including, without limitation, by way of merger, consolidation or sale and leaseback transaction) (collectively, a “transfer”), directly or indirectly, in one or a series of related transactions, of:
(a)any Capital Stock of any Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Parent Guarantor or a Restricted Subsidiary);
(b)all or substantially all of the properties and assets of any division or line of business of the Parent Guarantor or any Restricted Subsidiary; or
(c)any other of the Parent Guarantor’s or any Restricted Subsidiary’s properties or assets.
Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(i)any transfer or disposition of assets that is governed by the provisions of Article Five and Section 4.11 or any transfer or disposition of assets consummated in connection with a Permitted Reorganization;
(ii)any transfer or disposition of assets by the Parent Guarantor to the Issuers or any Restricted Subsidiary, or by any Restricted Subsidiary to the Parent Guarantor, the Issuers or any Restricted Subsidiary in accordance with the terms of this Indenture;
(iii)any transfer or disposition of obsolete or permanently retired equipment or facilities that are no longer useful in the conduct of the Parent Guarantor’s and any Restricted Subsidiary’s business and that are disposed of in the ordinary course of business;
(iv)any disposition of accounts receivable and related assets in a Permitted Receivables Financing;
(v)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(vi)the foreclosure, condemnation or any similar action with respect to any property or other assets;
(vii)any unwinding or termination of hedging obligations not for speculative purposes;
(viii)any single transaction or series of related transactions that involves assets or Capital Stock having a Fair Market Value of less than the greater of $50,000,000 and 0.75% of Total Assets;
(ix)for the purposes of Section 4.09 only, the making of a Permitted Investment or a disposition permitted under Section 4.08; or, solely for the purposes Section 4.09(b), asset sales, the
proceeds of which are used within 540 days of receipt of such proceeds to make such Restricted Payments, Permitted Payments or Permitted Investments;
(x)the sale, lease or other disposition of equipment, inventory, property or other assets in the ordinary course of business;
(xi)the lease, assignment or sublease of any real or personal property in the ordinary course of business;
(xii)an issuance of Capital Stock by a Restricted Subsidiary to the Parent Guarantor or to another Restricted Subsidiary;
(xiii)a Permitted Investment or a Restricted Payment (or a transaction that would constitute a Restricted Payment but for the exclusions from the definition thereof) that is not prohibited by Section 4.08;
(xiv)any disposition of Capital Stock, Debt or other securities of any Unrestricted Subsidiary or a Permitted Joint Venture;
(xv)sales of assets received by the Parent Guarantor or any Restricted Subsidiary upon the foreclosure on a Lien granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(xvi)sales or grants of licenses to use the patents, trade secrets, know-how and other intellectual property of the Parent Guarantor or any of its Restricted Subsidiaries to the extent that such license does not prohibit the Parent Guarantor or any of its Restricted Subsidiaries from using the technologies licensed (other than pursuant to exclusivity or non-competition arrangements negotiated on an arm’s‑length basis) or require the Parent Guarantor or any of its Restricted Subsidiaries to pay any fees for any such use;
(xvii)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business; or
(xviii)sales, issuances, conveyances, transfers, leases or other dispositions to the extent constituting Permitted Liens.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Average Life” means, as of the date of determination with respect to any Debt, the quotient obtained by dividing:
(a)the sum of the products of:
(i)the numbers of years from the date of determination to the date or dates of each successive scheduled principal payment of such Debt; multiplied by
(ii)the amount of each such principal payment;
by
(b)the sum of all such principal payments.
“Bankruptcy Law” means any law relating to bankruptcy, insolvency, receivership, moratorium, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law, including, without limitation, (i) bankruptcy law of Ireland, (ii) bankruptcy law of The Netherlands, (iii) bankruptcy law of England, (iv) bankruptcy law of Germany, (v) bankruptcy law of Sweden, (vi) bankruptcy law of Denmark, (vii) bankruptcy law of Poland, (viii) bankruptcy law of Italy, (ix) bankruptcy law of Luxembourg or (x) Title 11, United States Bankruptcy Code of 1978, as amended.
“Board of Directors” means (i) with respect to any corporation, the board of directors or managers, as applicable, of the corporation, or any duly authorized committee thereof; (ii) with respect to any partnership, the board of directors or other governing body of the general partner, as applicable, of the partnership or any duly authorized committee thereof; (iii) with respect to a limited liability company, the managing member or members or any duly authorized controlling committee thereof; and (iv) with respect to any other Person, the board or any duly authorized committee of such Person serving a similar function. Whenever any provision of this Indenture requires any action or determination to be made by, or any approval of, a Board of Directors (including for the avoidance of doubt any committee thereof), such action, determination or approval shall be deemed to have been taken or made if approved by a majority of the directors (excluding employee representatives, if any) on any such Board of Directors (whether or not such action or approval is taken as part of a formal board meeting or as a formal board approval), including for the avoidance of doubt any committee thereof. Unless the context requires otherwise, Board of Directors means the Board of Directors of the Parent Guarantor.
“Book-Entry Interest” means a beneficial interest in a Global Note held through and shown on, and transferred only through, records maintained in book-entry form by DTC and its nominees and successors.
“Business Day” means a day of the year on which banks are not required or authorized by law to close in Dublin, New York City or London.
“Capital Stock” means, with respect to any Person, any and all shares, interests, partnership interests (whether general or limited), participations, rights in or other equivalents (however designated) of such Person’s equity, any other interest or participation that confers the right to receive a share of the profits and losses, or distributions of assets of, such Person and any rights (other than debt securities convertible into or exchangeable for Capital Stock), warrants or options exchangeable for or convertible into such Capital Stock, whether now outstanding or issued after the Issue Date.
“Capitalized Lease Obligation” means, with respect to any Person, any obligation of such Person under a lease of (or other agreement conveying the right to use) any property (whether real, personal or mixed), which obligation is required to be classified and accounted for as a capital lease obligation under IFRS, and, for purposes of this Indenture, the amount of such obligation at any date will be the capitalized amount thereof at such date, determined in accordance with IFRS and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Cash Equivalents” means any of the following:
(a)any evidence of Debt with a maturity of 180 days or less from the date of acquisition issued or directly and fully guaranteed or insured by a member state of the European Union or European Economic Area, the United States of America, any state thereof or the District of Columbia, Canada, Switzerland, Australia or any agency or instrumentality thereof (each, an “Approved Jurisdiction”);
(b)time deposit accounts, certificates of deposit, money market deposits or bankers’ acceptances with a maturity of 180 days or less from the date of acquisition issued by a bank or trust company having combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating, at the time any investment is made therein, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s;
(c)commercial paper with a maturity of 180 days or less from the date of acquisition issued by a corporation that is not either Issuer’s or any Restricted Subsidiary’s Affiliate and is at the time of acquisition, rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s;
(d)repurchase obligations with a term of not more than seven days for underlying securities of the type described in clause (a) or (b) above entered into with a financial institution meeting the qualifications described in clause (b) above;
(e)investments in money market mutual funds at least 95% of the assets of which constitute Cash Equivalents of the kind described in clauses (a) through (d) above; or
(f)any investments classified as cash equivalents under IFRS.
“Change of Control” means the occurrence of any of the following events:
(a)the consummation of any transaction (including a merger or consolidation) the result of which is that (i) any person or group, other than one or more Permitted Holders, is or as a result of such transaction becomes, the beneficial owner, directly or indirectly, of more than 50% (or so long as any of the Existing Ardagh Bonds remain outstanding, 35%) of the total voting power of the Voting Stock of the Parent Guarantor and (ii) the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such other person or group;
(b)the sale, transfer, conveyance or other disposition (other than by way of merger, consolidation or transfer of the Parent Guarantor’s Voting Stock or in connection with a Permitted Reorganization) of all or substantially all of the assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor, the Issuers and the Restricted Subsidiaries, on a consolidated basis, to any person or group other than one or more Permitted Holders;
(c)the Parent Guarantor or either Issuer is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which does not violate the provisions described under Article Five or in connection with a Permitted Reorganization; or
(d)the Parent Guarantor or any Surviving Entity ceases to beneficially own, directly or indirectly, 100% of the Voting Stock of either Issuer, other than director’s qualifying shares and other shares required to be issued by law.
For the purposes of this definition, (i) “person” and “group” have the meanings they have in Sections 13(d) and 14(d) of the Exchange Act; (ii) “beneficial owner” is used as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only
after the passage of time; and (iii) a Person or group will be deemed to beneficially own all Voting Stock of an entity held by a parent entity, if such Person or group is or becomes the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of such parent entity and the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such Person or group.
“Code” means the Internal Revenue Code of 1986, as amended.
“Commission” means the U.S. Securities and Exchange Commission.
“Commodity Hedging Agreements” means any type of commodity hedging agreement (including emissions hedging) designed to protect against or manage exposure to fluctuations in commodity prices and entered into in good faith for such purposes.
“Consolidated Adjusted Net Income” means, for any period, the Parent Guarantor’s and the Restricted Subsidiaries’ consolidated net income (or loss) for such period as determined in accordance with IFRS, adjusted by excluding (to the extent included in such consolidated net income or loss), without duplication:
(a)any net after-tax extraordinary gains or losses;
(b)any net after-tax gains or losses attributable to sales of assets of the Parent Guarantor or any Restricted Subsidiary that are not sold in the ordinary course of business;
(c)the portion of net income or loss of any Person (other than the Parent Guarantor or a Restricted Subsidiary), including Unrestricted Subsidiaries, in which the Parent Guarantor or any Restricted Subsidiary has an equity ownership interest, except that the Parent Guarantor’s or a Restricted Subsidiary’s equity in the net income of such Person for such period shall be included in such Consolidated Adjusted Net Income to the extent of the aggregate amount of dividends or other distributions actually paid to the Parent Guarantor or any Restricted Subsidiary in cash dividends or other distributions during such period;
(d)the net income or loss of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary is not at the date of determination permitted, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary or its shareholders (other than restrictions contained in the Credit Facilities and related agreements permitted by Section 4.06(b)(ii));
(e)any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves or provisions therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering or refinancing of debt or equity securities;
(f)the non-cash accounting effects of any acquisition, purchase, merger, reorganization or other similar transaction, including any increase in amortization or depreciation resulting from adjustments to tangible or intangible assets, the consequence of any revaluation of inventory or other non-cash charges or effects (including losses on derivatives);
(g)the cumulative effect of a change in accounting principles after the Issue Date;
(h)any charge or expense recorded for non-cash or capitalized interest on Deeply Subordinated Funding;
(i)net after tax gains or losses attributable to (i) the termination of pension plans, (ii) the acquisition of securities or the extinguishment of debt or (iii) currency exchange transactions that are not in the ordinary course of business;
(j)net income or loss attributable to discontinued operations; and
(k)any restoration to net income of any contingency reserve, except to the extent it was provided for in a prior period.
“Consolidated Fixed Charge Coverage Ratio” of the Parent Guarantor means, for any period, the ratio of:
(a)the sum of Consolidated Adjusted Net Income, plus in each case to the extent deducted in computing Consolidated Adjusted Net Income for such period:
(i)Consolidated Net Interest Expense;
(ii)Consolidated Tax Expense; and
(iii)Consolidated Non-cash Charges, less all non-cash items increasing Consolidated Adjusted Net Income for such period and less all cash payments during such period relating to non-cash charges that were added back to Consolidated Adjusted Net Income in determining the Consolidated Fixed Charge Coverage Ratio in any prior period;
(b)to the sum of:
(i)Consolidated Net Interest Expense; and
(ii)cash and non-cash dividends due (whether or not declared) on the Parent Guarantor’s and any Restricted Subsidiary’s Preferred Stock (to any Person other than the Parent Guarantor and any Wholly Owned Restricted Subsidiary), in each case for such period;
provided that in calculating the Consolidated Fixed Charge Coverage Ratio or any element thereof for any period, pro forma effect will be given to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation; provided, further, without limiting the application of the previous proviso, that:
(v)if the Parent Guarantor or any Restricted Subsidiary has incurred any Debt since the beginning of such period that remains outstanding or if the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio is an incurrence of Debt
or both, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Debt as if such Debt had been incurred on the first day of such period and the discharge of any other Debt repaid, repurchased, defeased or otherwise discharged with the proceeds of such new Debt as if such discharge had occurred on the first day of such period;
(w)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary shall have made any Asset Sale, Consolidated Adjusted Net Income for such period shall be reduced by an amount equal to the Consolidated Adjusted Net Income (if positive) directly attributable to the assets which are the subject of such Asset Sale for such period, or increased by an amount equal to the Consolidated Adjusted Net Income (if negative) directly attributable thereto, for such period and the Consolidated Net Interest Expense for such period shall be reduced by an amount equal to the Consolidated Net Interest Expense directly attributable to any Debt of the Parent Guarantor or of any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to the Parent Guarantor and the continuing Restricted Subsidiaries in connection with such Asset Sale for such period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated Net Interest Expense for such period directly attributable to the Debt of such Restricted Subsidiary to the extent the Parent Guarantor and the continuing Restricted Subsidiaries are no longer liable for such Debt after such sale);
(x)if, since the beginning of such period, the Parent Guarantor or any Restricted Subsidiary (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of an asset occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the incurrence of any Debt) as if such Investment or acquisition occurred on the first day of such period;
(y)if, since the beginning of such period, any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Parent Guarantor or any Restricted Subsidiary since the beginning of such period) shall have made any Asset Sale or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (x) or (y) above if made by the Parent Guarantor or a Restricted Subsidiary during such period, Consolidated Adjusted Net Income and Consolidated Net Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Asset Sale or Investment or acquisition occurred on the first day of such period; and
(z)that the pro forma calculation shall not give effect to: (i) any amounts under clause (b) above attributable to Debt or Preferred Stock incurred on such determination date pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock incurred pursuant to Section 4.06(b)(xix)) or (ii) amounts attributable to any Debt or Preferred Stock discharged on such determination date to the extent that such discharge results from the proceeds incurred pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock discharged on such determination date using proceeds of Debt Preferred Stock incurred pursuant to Section 4.06(b)(xix)).
If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the rate in effect on the date of determination had been the applicable
rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt for a period equal to the remaining term of such Interest Rate Agreement).
“Consolidated Leverage Ratio” of the Parent Guarantor means, as of the date of determination, the ratio of (a) (i) the sum of consolidated Debt of the Parent Guarantor (other than working capital and other than Debt described in clause (f) of the definition of “Debt”) less (ii) cash and Cash Equivalents on the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19 to (b) the aggregate consolidated EBITDA of the Parent Guarantor for the period of the most recent four consecutive quarters for which financial statements are available under Section 4.19, in each case with such pro forma adjustments to consolidated Debt and consolidated EBITDA as are appropriate and consistent with the pro forma provisions set forth in the definition of “Consolidated Fixed Charge Coverage Ratio”.
“Consolidated Net Interest Expense” means, for any period, without duplication and in each case determined on a consolidated basis in accordance with IFRS, the sum of:
(a)the Parent Guarantor’s and the Restricted Subsidiaries’ total interest expense for such period, including, without limitation:
(i)amortization of debt discount;
(ii)the net costs of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements (including amortization of fees and discounts);
(iii)commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and similar transactions; and
(iv)the interest portion of any deferred payment obligation and amortization of debt issuance costs; plus
(b)the interest component of the Parent Guarantor’s and the Restricted Subsidiaries’ Capitalized Lease Obligations accrued and/or scheduled to be paid or accrued during such period other than the interest component of Capitalized Lease Obligations between or among the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; plus
(c)the Parent Guarantor’s and the Restricted Subsidiaries non-cash interest expenses and interest that was capitalized during such period; plus
(d)the interest expense on Debt of another Person to the extent such Debt is guaranteed by the Parent Guarantor or any Restricted Subsidiary or secured by a Lien on the Parent Guarantor’s or any Restricted Subsidiary’s assets, but only to the extent that such interest is actually paid by the Parent Guarantor or such Restricted Subsidiary; minus
(e)the interest income of the Parent Guarantor and the Restricted Subsidiaries during such period.
Notwithstanding any of the foregoing, Consolidated Net Interest Expense shall not include any of the following:
(a)interest accrued, capitalized or paid in respect of Deeply Subordinated Funding;
(b)gains, losses, expenses or charges associated with refinancing of debt;
(c)gains, losses, expenses or charges associated with the total or partial extinguishment of debt;
(d)gains, losses, expenses or charges resulting from “mark to market” provisions or fair value charges applied to or resulting from derivatives; or
(e)any non-cash pension expense.
“Consolidated Non-cash Charges” means, for any period, the aggregate depreciation, amortization and other non-cash expenses of the Parent Guarantor and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS (excluding any such non-cash charge that requires an accrual of or reserve for cash charges for any future period).
“Consolidated Tax Expense” means, for any period with respect to any Relevant Taxing Jurisdiction, the provision for all national, local and foreign federal, state or other income taxes of the Parent Guarantor and the Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with IFRS.
“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
“Contribution Debt” means Debt of the Parent Guarantor or any Restricted Subsidiary in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions and any such cash contributions that have been used to make a Restricted Payment or a Permitted Investment) made to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case, after the Issue Date, provided that (without prejudice to the rights of the Parent Guarantor and the Restricted Subsidiaries, including the right to divide and/or classify and/or reclassify as described in Section 4.06) such Contribution Debt is so designated as Contribution Debt pursuant to an Officer’s Certificate on the incurrence date thereof.
“Credit Facility” or “Credit Facilities” means one or more debt facilities, indentures or other arrangements with banks, insurance companies, other financial institutions or investors providing for revolving credit loans, term loans, notes, receivables financings, letters of credit or other forms of guarantees and assurances, or other Debt, including overdrafts, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, repaid or refinanced (and whether in whole or in part and whether or not with the original administrative agent or lenders or another administrative agent or agents or other bank or institutions and whether provided under one or more other credit or other agreements, indentures, financing agreements or otherwise) and, for the avoidance of doubt, includes any agreement extending the maturity of, refinancing or restructuring all or any portion of the indebtedness under such agreements or any successor agreements.
“Currency Agreements” means, in respect of a Person, any spot or forward foreign exchange agreements and currency swap, currency option or other similar financial agreements or arrangements designed to protect such Person against or manage exposure to fluctuations in foreign currency exchange rates.
“Custodian” means any receiver, trustee, assignee, liquidator, custodian, administrator or similar official under any Bankruptcy Law.
“Debt” means, with respect to any Person, without duplication:
(a)all liabilities of such Person for borrowed money (including overdrafts) or for the deferred purchase price of property or services, excluding any trade payables and other accrued current liabilities incurred in the ordinary course of business;
(b)all obligations of such Person evidenced by bonds, notes, debentures or other similar instruments;
(c)all obligations, contingent or otherwise, of such Person in connection with any letters of credit, bankers’ acceptances, receivables facilities or other similar facilities;
(d)all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even if the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade payables arising in the ordinary course of business;
(e)all Capitalized Lease Obligations of such Person;
(f)all obligations of such Person under or in respect of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements; and
(g)all Redeemable Capital Stock of such Person valued at the greater of its voluntary maximum fixed repurchase price and involuntary maximum fixed repurchase price plus accrued and unpaid dividends;
if and to the extent any of the preceding items would appear as debt on a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS, provided that the term “Debt” shall not include (i) non-interest bearing installment obligations and accrued liabilities incurred in the ordinary course of business that are not more than 90 days past due; (ii) Debt in respect of the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of standby letters of credit, performance bonds or surety bonds provided by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business to the extent such letters of credit or bonds are not drawn upon or, if and to the extent drawn upon are honored in accordance with their terms and if, to be reimbursed, are reimbursed no later than the fifth Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit or bond; (iii) anything accounted for as an operating lease in accordance with the Election Option; (iv) any pension obligations of the Parent Guarantor or a Restricted Subsidiary; (v) Debt incurred by the Parent Guarantor or one of the Restricted Subsidiaries in connection with a transaction where (x) such Debt is borrowed from a bank or trust company having a combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating immediately prior to the time such transaction is entered into, of at least A or the equivalent thereof by S&P and A2 or the equivalent thereof by Moody’s and (y) a substantially concurrent Investment is made by the Parent Guarantor or a Restricted Subsidiary in the form of cash deposited with the lender of such Debt, or a Subsidiary or Affiliate thereof, in amount equal to such Debt; and (vi) Deeply Subordinated Funding. In addition, “Debt” of the specified Person shall include all Debt of another Person secured by a Lien on any asset of the specified Person (whether or not such Debt is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of Debt of another Person, and Preferred Stock of any Restricted Subsidiary.
For purposes of this definition, the “maximum fixed repurchase price” of any Redeemable Capital Stock that does not have a fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Redeemable Capital Stock as if such Redeemable Capital Stock were purchased on any date on which Debt will be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the Fair Market Value of such Redeemable Capital Stock, such Fair Market Value will be determined in good faith by the Board of Directors of the issuer of such Redeemable Capital Stock; provided, that if such Redeemable Capital Stock is not then permitted to be redeemed, repaid or repurchased, the redemption, repayment or repurchase price shall be the book value of such Redeemable Capital Stock as reflected in the most recent financial statements of such Person.
“Deeply Subordinated Funding” means any funds provided to the Parent Guarantor pursuant to an agreement, note, security or other instrument, other than Capital Stock, that (i) is subordinated in right of payment to all Debt of the Parent Guarantor, (ii)(A) does not mature or require any amortization, redemption or other repayment of principal, (B) does not require payment of any cash interest or any similar cash amounts, and (C) contains no change of control or similar provisions and does not accelerate and has no right to declare a default or event of default or take any enforcement action or otherwise require any cash payment (other than as a result of insolvency proceedings of the Parent Guarantor), in each case prior to the 90th day following the repayment in full of the Notes and all other amounts due under this Indenture, (iii) does not provide for or require any security interest or encumbrance over any asset of the Parent Guarantor or any Restricted Subsidiary and (iv) does not contain any covenants (financial or otherwise) other than a covenant to pay such Deeply Subordinated Funding.
“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.
“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Parent Guarantor or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, executed by the principal financial officer of the Parent Guarantor, less the amount of Cash Equivalents received in connection with a subsequent sale, redemption, repurchase of, or collection or payment on, such Designated Non-cash Consideration.
“Designated Senior Debt” means (a) any Debt outstanding under the Senior Credit Facilities and the Existing Secured Notes and (b) any other Senior Debt permitted under this Indenture the principal amount of which is €30,000,000 or more as of the date of determination and that has been designated by the Issuers, the Parent Guarantor or the relevant Restricted Subsidiary as “Designated Senior Debt.”
“Disinterested Director” means, with respect to any transaction or series of related transactions, a member of the Parent Guarantor’s Board of Directors who does not have any material direct or indirect financial interest in or with respect to such transaction or series of related transactions or is not an Affiliate, or an officer, director or employee of any Person (other than the Parent Guarantor or any Restricted Subsidiary) who has any direct or indirect financial interest in or with respect to such transaction or series of related transactions; provided that no member of the Parent Guarantor’s Board of Directors shall be deemed to have any such direct or indirect financial interest solely as a result of such member’s ownership of Capital Stock of the Parent Guarantor or any successor or any company holding shares, directly or indirectly, in the Parent Guarantor or such member’s serving on the Board of Directors of any company holding shares, directly or indirectly, in the Parent Guarantor.
“Disposition” has the meaning assigned to such term in the Offering Memorandum.
“Dollar Equivalent” means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for the determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published under “Currency Rates” in the section of the Financial Times entitled “Currencies, Bonds & Interest Rates” on the date that is two Business Days prior to such determination.
“DTC” means The Depository Trust Company, its nominees and successors.
“Enforcement Action” means, in relation to any Debt of a Subsidiary Guarantor, any action (whether taken by the relevant creditor or creditors or an agent or trustee on its or their behalf) to:
(a)demand payment, declare prematurely due and payable or otherwise seek to accelerate payment of all or any part of such Debt;
(b)recover all or any part of such Debt (including, by exercising any rights of set-off or combination of accounts);
(c)exercise or enforce any rights under or pursuant to any guarantee or other assurance given by such Subsidiary Guarantor in respect of such Debt;
(d)exercise or enforce any rights under any security interest whatsoever which secures such Debt;
(e)commence legal proceedings against any Person; or
(f)commence, or take any other steps which could lead to the commencement of:
(i)any insolvency, liquidation, dissolution, winding-up, administration, receivership, compulsory merger or judicial re-organization of any Person;
(ii)the appointment of a trustee in bankruptcy, or insolvency conciliator, ad hoc official, judicial administrator, a liquidator or other similar officer in respect of any Person; or
(iii)any other similar process or appointment
“euro” or “€” means the lawful currency of the member states of the European Union who have agreed to share a common currency in accordance with the provisions of the Maastricht Treaty dealing with European monetary union.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Excluded Contribution” means Net Cash Proceeds or property or assets received by the Parent Guarantor as capital contributions (other than Contribution Debt and any contributions used to make a Restricted Payment or a Permitted Investment) to the equity (other than through the issuance of Redeemable Capital Stock) of the Parent Guarantor or in the form of Deeply Subordinated Funding, in each case of such capital contribution or Deeply Subordinated Funding, after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary or an employee stock ownership plan or trust established by the Parent Guarantor or any Subsidiary of the Parent Guarantor for the benefit of its employees to the extent funded
by the Parent Guarantor or any Restricted Subsidiary) of Capital Stock (other than Redeemable Capital Stock) of the Parent Guarantor, in each case, to the extent designated as an Excluded Contribution pursuant to an Officer’s Certificate of the Parent Guarantor.
“Existing Ardagh Bonds” means (i) the Existing Secured Notes and (ii) the Existing Unsecured Notes and any other international debt securities of the Parent Guarantor or any of its Restricted Subsidiaries outstanding on the Issue Date.
“Existing Debt” means all Debt of the Parent Guarantor and its Restricted Subsidiaries outstanding on the Issue Date after giving effect to the issue of the Notes and the New Secured Notes and the use of proceeds therefrom.
“Existing Secured Notes” means the May 2016 Secured Notes and the March 2017 Secured Notes.
“Existing Unsecured Notes” means the May 2016 Senior Notes, the January 2017 Senior Notes and the June 2017 Senior Notes.
“F&S Carve‑out Subsidiaries” means Impress Belgium NV, Ardagh Metal Packaging Canada Limited, Ardagh Metal Packaging Czech Republic s.r.o., Ardagh Metal Packaging Hjørring A/S, Ardagh Group France SAS, Ardagh MP Group France SA, Ardagh Metal Packaging France SAS, Ardagh MP West France SAS, Ardagh Aluminium Packaging France SAS, Ardagh Germany MP GmbH, Ardagh Metal Packaging Germany GmbH, Ardagh Metal Packaging Hellas SA, Ardagh Metal Packaging Hungary Kft, Ardagh Aluminium Packaging Hungary Kft, Ardagh Metal Packaging Italy s.r.l., Ardagh Metal Packaging Japan Kabushiki Kaisha, Ardagh Metal Packaging Latvia SIA, Ardagh Metal Packaging Morocco SAS, Ardagh MP Group Netherlands B.V., Ardagh Metal Packaging Netherlands B.V., Ardagh Aluminium Packaging Netherlands B.V., Ardagh Russia Holdings 1 B.V., Ardagh Russia Holdings 2 B.V., Ardagh Metal Packaging Poland Sp. Z o.o, Ardagh Metal Packaging Buftea SA, Ardagh Metal Packaging Rus LLC, Ardagh Metal Packaging Kuban LLC, Ardagh Metal Packaging (Seychelles) Limited, Ardagh Metal Packaging Korea Chusik Hoesa, Ardagh Metal Packaging Iberica S.A.U., Ardagh Metal Packaging Ukraine LLC, Ardagh MP Holdings UK Limited, Ardagh Metal Packaging UK Limited, Impress Metal Packaging (Trustee) Limited, Impress Sutton Limited and Ardagh Metal Packaging USA Inc.
“Fair Market Value” means, with respect to any asset or property, the sale value that would be obtained in an arm’s-length free market 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 Parent Guarantor’s Board of Directors.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in section 1471(b) of the Code, or otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, or any law implementing an intergovernmental approach thereto.
“Guarantee” means any guarantee of the Issuers’ obligations under this Indenture and the Notes by the Parent Guarantor, any Restricted Subsidiary or any other Person in accordance with the provisions of this Indenture, including the Guarantees by the Guarantors dated as of the Issue Date. When used as a verb, “Guarantee” shall have a corresponding meaning.
“guarantees” means, as applied to any obligation,
(a)a guarantee (other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business), direct or indirect, in any manner, of any part or all of such obligation; and
(b)an agreement, direct or indirect, contingent or otherwise, the practical effect of which is to assure in any way the payment or performance (or payment of damages in the event of non-performance) of all or any part of such obligation, including, without limiting the foregoing, by the pledge of assets and the payment of amounts drawn down under letters of credit.
“Guarantor” means the Parent Guarantor and the Subsidiary Guarantors, together, and any other Person that is a guarantor of the Notes, including any Person that is required after the Issue Date to execute a guarantee of the Notes pursuant to Section 4.14 or Section 4.15 until a successor replaces such party pursuant to the applicable provisions of this Indenture and, thereafter, shall mean such successor.
“Holder” means the Person in whose name a Note is registered on the Registrar’s books.
“IFRS” means International Financial Reporting Standards (formerly International Accounting Standards) endorsed from time to time by the European Union or any variation thereof with which the Parent Guarantor or its Restricted Subsidiaries are, or may be, required to comply, as in effect on the Issue Date or, with respect to Section 4.19 as in effect from time to time. Except as otherwise set forth in this Indenture, all ratios and calculations based on IFRS (or, as applicable, GAAP) contained in this Indenture shall be computed in accordance with IFRS as in effect on the Issue Date (or, as applicable, GAAP as in effect at the date specified by the Parent Guarantor in its election to adopt GAAP in accordance with the fourth sentence of this definition). At any time after the Issue Date, the Parent Guarantor may elect to implement any new measures or other changes to IFRS (or, as applicable, GAAP) in effect on or prior to the date of such election; provided that any such election, once made, shall be irrevocable. At any time after the Issue Date, the Parent Guarantor may elect to apply GAAP accounting principles in lieu of IFRS and, upon any such election, references herein to IFRS shall thereafter be construed to mean GAAP (except as otherwise provided in this Indenture), including as to the ability of the Parent Guarantor to make an election pursuant to the previous sentence; provided that any such election, once made, shall be irrevocable; provided, further, that any calculation or determination in this Indenture that requires the application of IFRS for periods that include fiscal quarters ended prior to the Parent Guarantor’s election to apply GAAP shall remain as previously calculated or determined in accordance with IFRS; provided, further again, that the Parent Guarantor may only make such election if it also elects to report any subsequent financial reports required to be made by the Parent Guarantor. The Parent Guarantor shall give notice of any such election made in accordance with this definition to the Trustee and the Holders. Notwithstanding any of the foregoing, (i) in relation to the making of any determination or calculation under this Indenture, the Parent Guarantor shall be required to elect (the “Election Option”), from time to time and each time, either (A) to apply IFRS 16 (Leases) or (B) to apply IAS 17 (Leases) (or, in each case, the equivalent measure under GAAP) to the making of such determination or calculation, provided that, if such determination or calculation involves more than one element (including for the calculation of a financial ratio), such selected accounting standard shall be consistently applied to each element of such determination or calculation (other than, for the avoidance of doubt, in relation to Section 4.19); and (ii) any adverse impact directly or indirectly relating to or resulting from the implementation of IFRS 15 (Revenue from Contracts with Customers) and any successor standard thereto (or any equivalent measure under GAAP) shall be disregarded with respect to all ratios, calculations and determinations based upon IFRS to be calculated or made, as the case may be, pursuant to this Indenture (other than, for the avoidance of doubt, in relation to Section 4.19).
“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof.
“Intercreditor Agreement” means the Intercreditor Agreement entered into on December 7, 2010, as amended and restated most recently on March 21, 2017 and from time to time among, inter alios, Ardagh Packaging Finance, Ardagh Packaging Holdings and Citibank, N.A., London Branch, in its capacity as security agent thereunder and trustee for the Existing Secured Notes, and to which the Trustee will accede as soon as reasonably practicable.
“Interest Payment Date” means the Stated Maturity of an installment of interest on the Notes.
“Interest Rate Agreements” means, in respect of a Person, any interest rate protection agreements and other types of interest rate hedging agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements) designed to protect such Person against or manage exposure to fluctuations in interest rates.
“Investment” means, with respect to any Person, any direct or indirect advance, loan or other extension of credit (including guarantees) or capital contribution to (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 others), or any purchase, acquisition or ownership by such Person of any Capital Stock, bonds, notes, debentures or other securities or evidences of Debt issued or owned by, any other Person and all other items that would be classified as investments on a balance sheet prepared in accordance with IFRS. In addition, the portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary will be deemed to be an “Investment” that the Parent Guarantor made in such Unrestricted Subsidiary at such time. The portion (proportionate to the Parent Guarantor’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Unrestricted Subsidiary at the time that such Unrestricted Subsidiary is designated a Restricted Subsidiary will be considered a reduction in outstanding Investments. “Investments” excludes extensions of trade credit on commercially reasonable terms in accordance with normal trade practices.
“Investment Grade Status” shall occur when the Notes receive both of the following:
(1)a rating of “BBB-” or higher from S&P; and
(2)a rating of “Baa3” or higher from Moody’s;
or the equivalent of such rating by either such rating organization or, if no rating of Moody’s or S&P then exists, the equivalent of such rating by any other Nationally Recognized Statistical Rating Organization.
“IP Cross License Agreement” means the IP Cross-License Agreement, as defined in the Offering Memorandum.
“Issue Date” means August 12, 2019.
“Issuers Order” means a written order signed in the name of the Issuers by any Person authorized by a resolution of the Board of Directors of each Issuer.
“January 2017 Senior Notes” means the existing $1,000,000,000 aggregate principal amount of 6.000% Senior Notes and $700,000,000 aggregate principal amount of 6.000% additional Senior Notes due 2025 issued by the Issuers.
“June 2017 Senior Notes” means the existing £400,000,000 aggregate principal amount of 4.750% Senior Notes due 2027 issued by the Issuers on June 12, 2017.
“Lien” means any mortgage or deed of trust, charge, pledge, lien (statutory or otherwise), privilege, security interest, hypothecation, assignment for security, standard security, assignation in security claim, or preference or priority or other encumbrance upon or with respect to any property of any kind, real or personal, movable or immovable, now owned or hereafter acquired. A Person shall be deemed to own subject to a Lien any property which such Person has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement.
“March 2017 Secured Notes” means the existing $715,000,000 aggregate principal amount of 4.250% Senior Secured Notes due 2022 and the existing €750,000,000 aggregate principal amount of 2.750% Senior Secured Notes due 2024 issued by the Issuers on March 8, 2017.
“Material Subsidiary” means any Restricted Subsidiary or group of Restricted Subsidiaries (taken together) that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date, measured, as of the last day of the most recent fiscal quarter for which financial statements are available or for the four fiscal quarters ended most recently for which financial statements are available, as the case may be.
“Maturity” means, with respect to any indebtedness, the date on which any principal of such indebtedness becomes due and payable as therein or herein provided, whether at the Stated Maturity with respect to such principal or by declaration of acceleration, call for redemption or purchase or otherwise.
“May 2016 Secured Notes” means the existing $500,000,000 aggregate principal amount of Floating Rate Notes due 2021, the existing €440,000,000 aggregate principal amount of 4.125% Senior Secured Notes due 2023 and the existing $1,000,000,000 aggregate principal amount of 4.625% Senior Secured Notes due 2023 issued by the Issuers on May 16, 2016.
“May 2016 Senior Notes” means the existing €750,000,000 aggregate principal amount of 6.750% Senior Notes due 2024 and the existing $1,650,000,000 aggregate principal amount of 7.250% Senior Notes due 2024 issued by the Issuers on May 16, 2016.
“Moody’s” means Moody’s Investors Service, Inc. and its successors.
“Mutual Services Agreement” means the Mutual Services Agreement defined in the Offering Memorandum and any modification, amendment, replacement or extension or any similar agreement.
“Nationally Recognized Statistical Rating Organization” means a nationally recognized statistical rating organization within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act.
“Net Cash Proceeds” means:
(a)with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents including (x) payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor
or any Restricted Subsidiary) and (y) any cash or Cash Equivalents received upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale, net of:
(i)brokerage commissions and other fees and expenses (including, without limitation, fees and expenses of legal counsel, accountants, investment banks and other consultants) related to such Asset Sale;
(ii)provisions for all taxes paid or payable, or required to be accrued as a liability under IFRS as a result of such Asset Sale;
(iii)all distributions and other payments required to be made to any Person (other than the Parent Guarantor or any Restricted Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale; and
(iv)appropriate amounts required to be provided by the Parent Guarantor or any Restricted Subsidiary, as the case may be, as a reserve in accordance with IFRS against any liabilities associated with such Asset Sale and retained by the Parent Guarantor or any Restricted Subsidiary, 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, all as reflected in an Officer’s Certificate delivered to the Trustee; and
(b)with respect to any capital contributions, issuance or sale of Capital Stock or options, warrants or rights to purchase Capital Stock, or debt securities or Capital Stock that have been converted into or exchanged for Capital Stock as referred to in Section 4.08, the proceeds of such issuance or sale in the form of cash or Cash Equivalents, payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed of for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Parent Guarantor or any Restricted Subsidiary), net of attorney’s fees, accountant’s fees and brokerage, consultation, underwriting and other fees and expenses actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.
“New Secured Indenture” means the indenture with respect to the New Secured Notes to be entered into on or about the Issue Date, by and among, inter alios, the Issuers and Parent Guarantor.
“New Secured Notes” means the senior secured notes issued by the Issuers concurrently with the Notes on the Issue Date.
“Offering Memorandum” means the confidential offering memorandum of the Issuers, dated July 30, 2019 relating to the Notes.
“Officer’s Certificate” means a certificate signed by an officer of the Parent Guarantor, either Issuer, a Guarantor or a Surviving Entity, as the case may be, and delivered to the Trustee.
“Opinion of Counsel” means a written opinion from legal counsel. The counsel may be an employee of or counsel to the Issuers.
“Pari Passu Debt” means (a) any Debt of the applicable Issuer that ranks equally in right of payment with the Notes or (b) with respect to any Guarantee, any Debt that ranks equally in right of payment to such Guarantee.
“Parties” means the Issuers, the Parent Guarantor, the Trustee, the Principal Paying Agent and any other party from time to time hereto (each, a “Party”).
“Permitted Debt” has the meaning given to such term under Section 4.06(b).
“Permitted Holders” means (a) Yeoman Capital S.A., (b) any of Paul Coulson, Brendan Dowling, Houghton Fry, Edward Kilty, John Riordan or Niall Wall, and any trust created for the benefit of one or more of the foregoing or their respective natural person Affiliates, or the estate, executor, administrator, committee or beneficiaries of any thereof, and (c) any of their respective Affiliates.
“Permitted Investments” means any of the following:
(a)Investments in cash or Cash Equivalents;
(b)intercompany Debt to the extent permitted under clause (iv) of the definition of “Permitted Debt”;
(c)Investments in (i) the form of loans borrowed by or advances to, or debt securities issued by, the Parent Guarantor, (ii) a Restricted Subsidiary or (iii) another Person if as a result of such Investment such other Person becomes a Restricted Subsidiary or such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, the Parent Guarantor or a Restricted Subsidiary;
(d)Investments made by the Parent Guarantor or any Restricted Subsidiary as a result of or retained in connection with an Asset Sale that does not violate Section 4.09;
(e)expenses or advances to cover payroll, travel, entertainment, moving, other relocation and similar matters;
(f)Investments in the Notes, the New Secured Notes and the Existing Ardagh Bonds;
(g)Investments existing at the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on, or made pursuant to a binding commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased as required by the terms of such Investment existing on the Issue Date;
(h)Investments in Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements permitted under Section 4.06(b)(viii), Section 4.06(b)(ix) and Section 4.06(b)(x) ;
(i)Investments made in the ordinary course of business, the Fair Market Value of which in the aggregate does not exceed $15,000,000 in any fiscal year in any transaction or series of related transactions;
(j)loans and advances (or guarantees to third‑party loans) to directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary made in the ordinary course of business and consistent with the Parent Guarantor’s past practices or past practices of the
Restricted Subsidiaries, as the case may be, in an amount outstanding not to exceed at any one time the greater of $30,000,000 and 0.5% of Total Assets;
(k)Investments in a Person to the extent that the consideration therefor consists of the issue and sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding or the net proceeds thereof (other than any Excluded Contribution or the proceeds of any Contribution Debt); provided that the net proceeds of such sale have been excluded from, and shall not have been included in, the calculation of the amount determined under clause (b)(iii)(B) of Section 4.08;
(l)pledges or deposits with respect to leases or utilities provided to third parties in the ordinary course of business;
(m)Investments of the Parent Guarantor or the Restricted Subsidiaries described under item (v) to the proviso to the definition of “Debt”;
(n)Investments, the amount of which, measured by reference to the Fair Market Value of each such Investment on the date it was made, not to exceed the sum of (x) the greater of $300,000,000 and 4.0% of Total Assets in the aggregate outstanding at any one time and (y) the sum of (i) the aggregate net after-tax amount returned in cash or through interest payments, principal payments, dividends or other distributions or payments on account of such Investment and (ii) the net after-tax cash proceeds received by the Parent Guarantor or any Restricted Subsidiary from the disposition of all or any portion of such Investments (other than to a Subsidiary); provided, however, that such net after-tax amounts have not been included in Consolidated Adjusted Net Income for the purpose of calculating clause (b)(iii)(A) of Section 4.08;
(o)Investments resulting from the acquisition of a Person that at the time of such acquisition held instruments constituting Investments that were not acquired in contemplation of the acquisition of such Person;
(p)Investments by the Parent Guarantor or any Restricted Subsidiary in connection with a Permitted Receivables Financing;
(q)loans or advances to (i) directors, officers or employees of the Parent Guarantor or any Restricted Subsidiary to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof pursuant to management equity plans or similar management or employee benefit arrangement or (ii) stock option plans, trust and similar asset pools to pay for the purchase of Capital Stock of the Parent Guarantor or any direct or indirect parent company thereof not to exceed the greater of $30,000,000 and 0.5% of Total Assets in the aggregate outstanding at any one time;
(r)(i) stock, obligations or securities received in satisfaction of judgments, foreclosure of liens, or settlement of debts or arbitration awards, and (ii) any Investments received in compromise of obligations of such persons incurred in the ordinary course of trade creditors or customers that were incurred in the ordinary course of business, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer;
(s)any Investments received in comprise or resolution of litigation, arbitration or other disputes;
(t)any guarantee of Debt permitted to be incurred by Section 4.06, performance guarantees and contingent obligations incurred in the ordinary course of business and creation of Liens on the assets of the Parent Guarantor or any Restricted Subsidiary in compliance with Section 4.07;
(u)any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with Section 4.10(b) (except transactions described in sub-clauses (ii), (v) and (x) thereof);
(v)advances, loans, rebates and extensions of credit (including the creation of receivables) to suppliers, customers and vendors, and advance payment made and deferred consideration and performance guarantees, in each case in the ordinary course of business; and
(w)any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business.
“Permitted Joint Venture” means any joint venture or similar combinations or other transaction pursuant to which the Parent Guarantor or any Restricted Subsidiary enters into, acquires or subscribes for any shares, stock, securities or other interest in or transfers any assets to any joint venture; provided, however, that the primary business of such joint venture is a Similar Business.
“Permitted Junior Securities” means, with respect to a Subsidiary Guarantor: (a) Capital Stock in such Subsidiary Guarantor or (b) debt securities of the Subsidiary Guarantor that are subordinated to all Senior Debt and any debt securities issued in exchange for Senior Debt to substantially the same extent as, or to a greater extent than, the Notes are subordinated to Senior Debt pursuant to this Indenture.
“Permitted Liens” means the following types of Liens:
(a)Liens existing as of the Issue Date;
(b)Liens (i) securing Debt under Credit Facilities and any other Senior Debt permitted to be incurred pursuant to Section 4.06 and (ii) Liens on any property or assets of the Parent Guarantor or a Restricted Subsidiary to secure Debt permitted to be incurred pursuant to Section 4.06(b)(ii);
(c)Liens on assets given, disposed of, or otherwise transferred in connection with a Permitted Receivables Financing permitted to be incurred pursuant to Section 4.06(b)(xiii);
(d)Liens on any property or assets of a Restricted Subsidiary granted in favor of the Parent Guarantor or any Restricted Subsidiary;
(e)Liens on any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets securing the Notes or any Guarantees;
(f)any interest or title of a lessor under any Capitalized Lease Obligation and Liens to secure Debt (including Capitalized Lease Obligations) permitted under Section 4.06 covering only the assets acquired with such Debt;
(g)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business;
(h)statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen, employees, pension plan administrators or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings or Liens arising solely by virtue of any statutory or common law provisions relating to attorney’s liens or bankers’ liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depositary institution;
(i)Liens for taxes, assessments, government charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings for which a reserve or other appropriate provision, if any, as shall be required in conformity with IFRS shall have been made;
(j)Liens incurred or deposits made to secure the performance of tenders, bids or trade or government contracts, or to secure leases, statutory or regulatory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business (other than obligations for the payment of money);
(k)zoning restrictions, easements, licenses, reservations, title defects, rights of others for rights-of-way, utilities, sewers, electrical lines, telephone lines, telegraph wires, restrictions, encroachments and other similar charges, encumbrances or title defects and incurred in the ordinary course of business that do not in the aggregate materially interfere with in any material respect the ordinary conduct of the business of the Parent Guarantor and its Restricted Subsidiaries on the properties subject thereto, taken as a whole;
(l)Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
(m)Liens on property existing at the time such property is acquired or on property of, or on shares of Capital Stock or Debt of, any Person existing at the time such Person is acquired by, merged with or into or consolidated with, the Parent Guarantor or any Restricted Subsidiary; provided that such Liens (i) do not extend to or cover any property or assets of the Parent Guarantor or any Restricted Subsidiary other than (A) the property or assets acquired or (B) the property or assets of the Person acquired, merged with or into or consolidated with the Parent Guarantor or Restricted Subsidiary and (ii) were created prior to, and not in connection with or in contemplation of such acquisition, merger or consolidation;
(n)Liens securing the Parent Guarantor’s or any Restricted Subsidiary’s obligations under Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements permitted under Sections 4.06(b)(viii), 4.06(b)(ix) and 4.06(b)(x) or any collateral for the Debt to which such Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements relate;
(o)Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or other insurance (including unemployment insurance) or deposits to secure public or statutory obligations of such Person or deposits of cash or government bonds to secure performance, bid, surety or appeal bonds and completion bonds and guarantees to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;
(p)Liens incurred in connection with a cash management program established in the ordinary course of business;
(q)Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Parent Guarantor or any Restricted Subsidiary, including rights of offset and set-off;
(r)any extension, renewal or replacement, in whole or in part, of any Permitted Lien; provided that any such extension, renewal or replacement shall not extend in any material respect to any additional property or assets;
(s)Liens securing Debt incurred to refinance Permitted Refinancing Debt permitted to be incurred under the New Secured Indenture; provided that any such Lien shall not extend to or cover materially any assets not securing the Debt so refinanced plus improvements and accessions to such property and assets and proceeds and distributions thereof;
(t)purchase money Liens to finance property or assets of the Parent Guarantor or any Restricted Subsidiary acquired in the ordinary course of business; provided that the related purchase money Debt shall not exceed the cost of such property or assets and shall not be secured by any property or assets of the Parent Guarantor or any Restricted Subsidiary other than the property and assets so acquired;
(u)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;
(v)Liens over the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture that secures Debt of such Unrestricted Subsidiary or Permitted Joint Venture;
(w)Liens incurred in the ordinary course of business of the Parent Guarantor or any Restricted Subsidiary with respect to an amount that does not exceed the greater of $225,000,000 and 3.0% of Total Assets at any one time outstanding and any replacements, extensions, modifications or renewals thereof;
(x)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created in the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(y)leases, licenses, subleases and sublicenses of assets in the ordinary course of business;
(z) Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third-party relating to such property or assets;
(aa) Liens on equipment of the Issuer or any Restricted Subsidiary granted in the ordinary course of business;
(bb)customary Liens on and in respect of deposits required in connection with the purchase of property, equipment and inventory, in each case incurred in the ordinary course of business;
(cc)(i) Liens on escrowed proceeds for the benefit of the related holders of debt securities or other Debt (or the underwriters or arrangers thereof) or (ii) Liens on cash set aside at the time of the incurrence of any Debt or government securities purchased with such cash, in either case, to the extent such cash or government securities prefund the payment of interest on such Debt and are held in escrow accounts or similar arrangements to be applied for such purpose; and
(dd)Liens on assets or property of a Restricted Subsidiary that is not a Subsidiary Guarantor securing Indebtedness and other Obligations of any Restricted Subsidiary that is not a Subsidiary Guarantor.
“Permitted Receivables Financing” means any financing pursuant to which the Parent Guarantor or any Restricted Subsidiary may sell, convey or otherwise transfer to any other Person or grant a security interest in, any accounts receivable (and related assets) in an aggregate principal amount equivalent to the Fair Market Value of such accounts receivable (and related assets) of the Parent Guarantor or any Restricted Subsidiary; provided that (a) the covenants, events of default and other provisions applicable to such financing shall be customary for such transactions and shall be on market terms (as determined in good faith by the Parent Guarantor’s Board of Directors) at the time such financing is entered into, (b) the interest rate applicable to such financing shall be a market interest rate (as determined in good faith by the Parent Guarantor’s Board of Directors) at the time such financing is entered into, and (c) such financing shall be non-recourse to the Parent Guarantor or any Restricted Subsidiary except to a limited extent customary for such transactions.
“Permitted Refinancing Debt” means any renewals, extensions, substitutions, refinancings or replacements (each, for purposes of this definition and Section 4.06(b)(xiv), a “refinancing”) of any Debt of the Parent Guarantor or a Restricted Subsidiary or pursuant to this definition, including any successive refinancings, so long as:
(a)such Debt is in an aggregate principal amount (or if incurred with original issue discount, an aggregate issue price) not in excess of the sum of (i) the aggregate principal amount (or if incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being refinanced and (ii) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, related to such refinancing;
(b)the Average Life of such Debt is equal to or greater than the Average Life of the Debt being refinanced;
(c)the Stated Maturity of such Debt is no earlier than the Stated Maturity of the Debt being refinanced;
(d)the new Debt is not senior in right of payment to the Debt that is being refinanced; and
(e)such Debt is unsecured or is secured by a Silent Second Lien, if the Debt being refinanced is unsecured.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, winding up or corporate reconstruction, directly or indirectly, in one or a series of related transactions involving the Parent Guarantor or any of its Restricted Subsidiaries (a “Reorganization”) that is made on a solvent basis; provided that any payments or assets distributed in connection with such Reorganization remain within the applicable Issuer and its Restricted Subsidiaries. For the avoidance of doubt, the term “Permitted Reorganization” shall include the closure of bank accounts and the conversion of debt instruments into Capital Stock or other equity instruments.
“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“Preferred Stock” means, with respect to any Person, Capital Stock of any class or classes (however designated) of such Person which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over the Capital Stock of any other class of such Person whether now outstanding, or issued after the Issue Date, and including, without limitation, all classes and series of preferred or preference stock of such Person.
“pro forma” means, with respect to any calculation made or required to be made pursuant to the terms of this Indenture, a calculation made in good faith by a responsible financial or accounting officer of the Parent Guarantor; provided that any such calculation shall (x) give effect to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given, as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation and (y) eliminate any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering of debt or equity securities.
“Property” means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock, and other securities of, any other Person. For purposes of any calculation required pursuant to this Indenture, the value of any Property shall be its Fair Market Value.
“Public Equity Offering” means an offer and sale of Qualified Capital Stock that are listed on an international securities exchange or publicly offered (which shall include an offering pursuant to Rule 144A and/or Regulation S under the Securities Act to professional market investors or similar persons).
“QIB” means a “Qualified Institutional Buyer” as defined in Rule 144A.
“Qualified Capital Stock” of any Person means any and all Capital Stock of such Person other than Redeemable Capital Stock.
“Record Date” for the interest payable on any Interest Payment Date means the Business Day immediately preceding such Interest Payment Date.
“Redeemable Capital Stock” means any class or series of Capital Stock that, either by its terms, by the terms of any security into which it is convertible or exchangeable, or by contract or otherwise, is, or
upon the happening of an event or passage of time would be, required to be redeemed prior to the final Stated Maturity of the Notes or is redeemable at the option of the holder thereof at any time prior to such final Stated Maturity (other than upon a Change of Control of the Parent Guarantor in circumstances in which the Holders would have similar rights), or is convertible into or exchangeable for debt securities at any time prior to such final Stated Maturity; provided that any Capital Stock that would constitute Qualified Capital Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of any “asset sale” or “change of control” occurring prior to the Stated Maturity of the Notes will not constitute Redeemable Capital Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Section 4.09 and Section 4.11 and such Capital Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Parent Guarantor’s or the Issuers’ repurchase of such Notes as are required to be repurchased pursuant to Section 4.09 and Section 4.11.
“Redemption Date” means, when used with respect to any Note to be redeemed, in whole or in part, the date fixed for such redemption by or pursuant to this Indenture.
“Redemption Price” means, when used with respect to any Note to be redeemed, the price at which it is to be redeemed pursuant to this Indenture.
“Refinance” means, with respect to any Debt, to amend, modify, extend, substitute, renew, replace, refund, prepay, repay, repurchase, redeem, defease or retire, or to issue other Debt, in exchange or replacement for, such Debt. “Refinanced” and “Refinancing” shall have correlative meanings.
“Regulation S” means Regulation S under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Replacement Assets” means properties and assets that replace the properties and assets that were the subject of an Asset Sale or properties and assets that are, or will be, used in the Parent Guarantor’s business or in that of the Restricted Subsidiaries or in a Similar Business or any and all businesses that in the good faith judgment of the Board of Directors of the Parent Guarantor are reasonably related, and, in each case, any capital expenditure relating thereto.
“Restricted Investment” means any Investment other than a Permitted Investment.
“Restricted Subsidiary” means any Subsidiary of the Parent Guarantor other than an Unrestricted Subsidiary.
“Reversion Date” means, after the Notes have achieved Investment Grade Status, the date, if any, that such Notes shall cease to have such Investment Grade Status.
“Rule 144” means Rule 144 under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Rule 144A” means Rule 144A under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“S&P” means Standard and Poor’s Ratings Service, a division of The McGraw-Hill Companies, Inc. and its successors.
“Securities Act” means the U.S. Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
(a)all Debt under any Credit Facility permitted to be incurred under Section 4.06 and all Commodity Hedging Agreements, Currency Agreements and Interest Rate Agreements and other obligations with respect thereto;
(b)any other Debt permitted to be incurred by either Issuer, the Parent Guarantor or any Restricted Subsidiary that provides a Guarantee under the terms of this Indenture unless, with respect to such a Restricted Subsidiary, the instrument under which such Debt is incurred expressly provides that it is on a parity with or subordinated in right of payment to its Guarantee, as the case may be; and
(c)all obligations with respect to the items listed in the preceding clauses (a) and (b).
Notwithstanding anything to the contrary in the preceding, Senior Debt will not include:
(i)any liability for taxes owed or owing by the Issuers or the Guarantors;
(ii)any Debt that is incurred in violation of this Indenture or the terms of the Notes, as the case may be; or
“Senior Holdco Notes” means (i) the existing €845,000,000 aggregate principal amount of 6.625% / 7.375% Senior Secured Toggle Notes due 2023 and $770,000,000 aggregate principal amount of 7.125% / 7.875% Senior Secured Toggle Notes due 2023 issued by ARD Finance S.A. on September 16, 2016 and (ii) the existing $350,000,000 aggregate principal amount of 8.750% Senior Secured PIK Notes due 2023 issued by ARD Securities Finance SARL on January 23, 2018 and, in each case, any replacements or refinancings thereof, directly or indirectly.
“Silent Second Liens” means Liens granted in favor of Debt (the “second priority Debt”) on property or assets of the Parent Guarantor or any of its Restricted Subsidiaries that:
(a)are by law or under the terms of an intercreditor agreement reasonably acceptable to the Trustee second in priority to first priority Liens on such property or assets; and
(b)are subject to arrangements in form and substance reasonably satisfactory to the Trustee which provide (x) that any payments on enforcement of the Liens in such property or assets (other than payments to the security agent, trustee, administrative agent or other representative of the holders of the second priority Debt) to the holders of the second priority Debt (or their representatives) will only be made once the Debt secured by the first priority Liens on such property or assets have been satisfied in full and (y) that the holders of the second priority Debt (and their representatives) will have no ability to cause the enforcement of, or direct the relevant security agent in the enforcement of, the Liens in such property or assets until the Debt secured by the first priority Liens on such property or assets have been satisfied in full.
“Similar Business” means any business, service or other activity engaged in by the Parent Guarantor or any Restricted Subsidiaries of the Parent Guarantor on the Issue Date and any business, service or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which the Parent Guarantor and the Restricted Subsidiaries are engaged on the Issue Date or any business that, in the good faith business judgment of the Parent Guarantor, constitutes a reasonable diversification of business conducted by the Parent Guarantor and its Subsidiaries.
“Stated Maturity” means, when used with respect to any note or any installment of interest thereon, the date specified in such note as the fixed date on which the principal of such note or such installment of interest, respectively, is due and payable, and, when used with respect to any other indebtedness, means the date specified in the instrument governing such indebtedness as the fixed date on which the principal of such indebtedness, or any installment of interest thereon, is due and payable.
“Sterling” or “£” means the lawful currency of the United Kingdom of Great Britain and Northern Ireland.
“Subordinated Debt” means Debt of either Issuer or any of the Guarantors (other than the Existing Ardagh Bonds, the Notes, the New Secured Notes and any Permitted Refinancing Debt in respect of the foregoing) that is subordinated in right of payment to the Notes or the Guarantees of such Guarantors, as the case may be; provided that no Debt shall be deemed to be subordinated in right of payment to any other Debt solely by virtue of being unsecured or by virtue of being secured on a junior Lien basis.
“Subsidiary” means, with respect to any Person:
(a)a corporation a majority of whose Voting Stock is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof; and
(b)any other Person (other than a corporation), including, without limitation, a partnership, limited liability company, business trust or joint venture, in which such Person, one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other Person performing similar functions).
“Subsidiary Guarantee” means any Guarantee given by a Subsidiary Guarantor.
“Subsidiary Guarantors” means any Restricted Subsidiary that provides a Guarantee, in each case until it is released from its obligations under its Guarantee and this Indenture in accordance with the terms of this Indenture.
“Total Assets” means the consolidated total assets of the Parent Guarantor and its Restricted Subsidiaries as shown on the most recent consolidated balance sheet of the Parent Guarantor.
“Total Inventories” means, as of any date, the amount of raw materials, packaging materials, work-in-progress and finished goods of the Parent Guarantor and the Restricted Subsidiaries, net of any provisions in respect of the foregoing items, in each case as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Total Receivables” means, as of any date, (a) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries plus (b) the amount of accounts receivable of the Parent Guarantor and the Restricted Subsidiaries that has been sold, conveyed or otherwise transferred in Permitted Receivables Financings and is outstanding, in each case, as of the date of the most recent consolidated balance sheet of the Parent Guarantor which has been delivered in accordance with Section 4.19.
“Transaction Agreement” means the transaction agreement dated July 14, 2019, among Ardagh Group S.A., Element Holdings II L.P. and Trivium Packaging B.V. as described in the Offering Memorandum.
“Transactions” shall have the meaning assigned to such term in the Offering Memorandum.
“Treasury Rate” means, as of any Redemption Date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the Redemption Date) of the yield to maturity of United States Treasury securities with a constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 Redemption Date to August 15, 2022; provided, however, that if the period from the Redemption Date to August 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Redemption Date to August 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
“Trust Officer” means any officer within the agency and corporate trust group, division or section of the Trustee (however named, or any successor group of the Trustee) and also means, with respect to any particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“Unrestricted Subsidiary” means:
(a)any Subsidiary of the Parent Guarantor that at the time of determination is an Unrestricted Subsidiary (as designated by the Parent Guarantor’s Board of Directors pursuant to Section 4.17);
(b)any Subsidiary of an Unrestricted Subsidiary; and
(c)Enville Limited, UniMould S.A., Ardagh Packaging Finance UK Limited, Ardagh Metal Packaging Italy Srl (Teramo), Recan GmbH, Impress Metal Packaging (Trustee) Limited and Recan UK Limited.
“U.S. dollar” or “$” means the lawful currency of the United States of America.
“U.S. Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America, and the payment for which the United States of America pledges its full faith and credit.
“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of
Directors, managers or trustees (or Persons performing similar functions) of any Person (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency).
“Wholly Owned Restricted Subsidiary” means any Restricted Subsidiary, all of the outstanding Capital Stock (other than directors’ qualifying shares or shares of Restricted Subsidiaries required to be owned by third parties pursuant to applicable law) of which are owned by the Parent Guarantor or by one or more other Wholly Owned Restricted Subsidiaries or by the Parent Guarantor and one or more other Wholly Owned Restricted Subsidiaries.
Term |
Defined in Section |
“Additional Amounts”............................................................................................................. |
4.12(a) |
“Additional Notes”................................................................................................................... |
Recitals |
“Additional Intercreditor Agreement”....................................................................................... |
4.13(a) |
“Additional Notes”................................................................................................................... |
Recitals |
“Agents”................................................................................................................................... |
2.03 |
“Authorized Agent”................................................................................................................. |
12.08 |
“Change of Control Offer”......................................................................................................... |
4.11(a) |
“Change of Control Purchase Date”........................................................................................... |
4.11(a) |
“Change of Control Purchase Price”........................................................................................... |
4.11(a) |
“covenant defeasance”........................................................................................................... |
8.03 |
“Defaulted Interest”................................................................................................................. |
2.12 |
“Election Option”..................................................................................................................... |
Definition of IFRS |
“Event of Default”................................................................................................................... |
6.01(a) |
“Excess Proceeds”................................................................................................................... |
4.09(b) |
“Excess Proceeds Offer”........................................................................................................... |
4.09(c) |
“Global Notes”......................................................................................................................... |
2.01(c) |
“Holdings USA Disposition”....................................................................................................... |
12.01(a) |
“incur”....................................................................................................................................... |
4.06(a) |
“incurrence”........................................................................................................................... |
4.06(a) |
“Interest Amount”................................................................................................................... |
12.15 |
“Irish Issuer”........................................................................................................................... |
Preamble |
Term |
Defined in Section |
“Issuers”................................................................................................................................... |
Preamble |
“legal defeasance”................................................................................................................... |
8.02 |
“Notes”..................................................................................................................................... |
Recitals |
“Obligations”........................................................................................................................... |
10.01(a) |
“Original Notes”....................................................................................................................... |
Recitals |
“Parent Guarantor”................................................................................................................. |
Preamble |
“Participants”........................................................................................................................... |
2.01(c) |
“Paying Agent”....................................................................................................................... |
2.03 |
“Permitted Debt”..................................................................................................................... |
4.06(b) |
“Permitted Payments”............................................................................................................. |
4.08(c) |
“Principal Paying Agent”........................................................................................................... |
Preamble |
“Registrar”............................................................................................................................... |
2.03 |
“Regulation S Global Note”....................................................................................................... |
2.01(b) |
“Relevant Fiscal Year”............................................................................................................... |
4.08(c)(xi) |
“Relevant Taxing Jurisdiction”................................................................................................... |
4.12(a) |
“Required Currency”............................................................................................................... |
12.14 |
“Restricted Global Note”......................................................................................................... |
2.01(b) |
“Restricted Payment”............................................................................................................... |
4.08(a) |
“Security Register”................................................................................................................... |
2.03 |
“Surviving Entity”..................................................................................................................... |
5.01(b)(i) |
“Suspension Event”................................................................................................................. |
4.22 |
“Taxes”..................................................................................................................................... |
4.12(a) |
“Transfer Agent”..................................................................................................................... |
2.03 |
“Trustee”................................................................................................................................. |
Preamble |
“U.S. Issuer”............................................................................................................................. |
Preamble |
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(i) a term has the meaning assigned to it; |
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(ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS; |
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(iii) “or” is not exclusive; |
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(iv) “including” or “include” means including or include without limitation; |
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(v) words in the singular include the plural and words in the plural include the singular; |
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(vi) unsecured or unguaranteed Debt shall not be deemed to be subordinate or junior to secured or guaranteed Debt merely by virtue of its nature as unsecured or unguaranteed Debt; and |
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(vii) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, clause or other subdivision. |
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(a) Form and Dating. The Notes and the Trustee’s (or the authenticating agent’s) certificate of authentication shall be substantially in the form of Exhibit A hereto with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture. The Notes may have notations, legends or endorsements required by law, the rules of any securities exchange agreements to which the Issuers are subject, if any, or usage; provided that any such notation, legend or endorsement is in form reasonably acceptable to the Issuers. The Issuers shall approve the form of the Notes. Each Note shall be dated the date of its authentication. The terms and provisions contained in the form of the Notes shall constitute and are hereby expressly made a part of this Indenture. The Notes shall be issued only in registered form without coupons and only in minimum denominations of $200,000 in principal amount and any integral multiples of $1,000 in excess thereof. |
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(b) Global Notes. Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A hereto, with such applicable legends as are provided in Exhibit A hereto, except as otherwise permitted herein (the “Restricted Global Note”), which shall be deposited on behalf of the purchasers of the Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Global Note and recorded in the Security Register, as hereinafter provided. |
Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A hereto, with such applicable legends as are provided in Exhibit A hereto, except as otherwise permitted herein (the “Regulation S Global Note”), which shall be deposited on behalf of the purchasers of the Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuers and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Regulation S Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Regulation S Global Note and recorded in the Security Register, as hereinafter provided.
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(c) Book-Entry Provisions. This Section 2.01(c) shall apply to the Regulation S Global Notes and the Restricted Global Notes (together, the “Global Notes”) deposited with DTC. |
Members of, or participants and account holders in, DTC (“Participants”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by DTC or by the Trustee or any custodian of DTC or under such Global Note, and DTC or its nominees may be treated by the Issuers, a Guarantor, the Trustee and any agent of the Issuers, a Guarantor or the Trustee as the sole owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, a Guarantor, the Trustee or any agent of the Issuers, a Guarantor or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as between DTC, on the one hand, and the Participants, on the other, the operation of customary practices of such persons governing the exercise of the rights of a Holder of a beneficial interest in any Global Note.
Subject to the provisions of Section 2.10(b), the registered Holder of a Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action that a Holder is entitled to take under this Indenture or the Notes.
Except as provided in Section 2.10, owners of a beneficial interest in Global Notes will not be entitled to receive physical delivery of certificated Notes.
If an authorized member of the Issuers’ boards of directors or an executive officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.
A Note shall not be valid or obligatory for any purpose until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Issuers shall execute and, upon receipt of an Issuers Order, the Trustee shall authenticate (whether itself or via the authenticating agent) (a) Original Notes, on the date hereof, for original issue up to an aggregate principal amount of $800,000,000 and (b) Additional Notes, from time to time, subject to compliance at the time of issuance of such Additional Notes with the provisions of Section 4.06. The Issuers are permitted to issue Additional Notes as part of a further issue under this Indenture, from time to time; provided that, if any Additional Notes are not fungible with any series of Original Notes, such Additional Notes will have a separate CUSIP number and/or ISIN, if applicable.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuers to authenticate the Notes. Unless limited by the terms of such appointment, any such authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by any such agent. An authenticating agent has the same rights as any Registrar, co-Registrar, Transfer Agent or Paying Agent to deal with the Issuers or an Affiliate of the Issuers.
The Trustee shall have the right to decline to authenticate and deliver any Notes under this Section 2.02 if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability to existing Holders.
office or agency where Notes may be transferred or exchanged (the “Transfer Agent”), an office or agency where the Notes may be presented for payment (the “Paying Agent” and references to the Paying Agent shall include the Principal Paying Agent) and an office or agency where notices or demands to or upon the Issuers in respect of the Notes may be served. The Issuers may appoint one or more Transfer Agents, one or more co-Registrars and one or more additional Paying Agents. |
The Issuers shall maintain a Principal Paying Agent in London. Either Issuer or any of their respective Affiliates may act as Transfer Agent, Registrar, co-Registrar, Paying Agent and agent for service of notices and demands in connection with the Notes; provided that neither Issuer nor any of their respective Affiliates shall act as Paying Agent for the purposes of Articles Three and Eight and Sections 4.09 and 4.11.
The Issuers hereby appoint Citibank, N.A., London Branch located at 25 Canada Square, London E14 5LB, United Kingdom as Transfer Agent, as Principal Paying Agent (the “Principal Paying Agent”) in London, United Kingdom, and as agent for service of notices and demands in connection with the Notes and Citigroup Global Markets Europe AG, at 5th Floor Reuterweg 16, 60323 Frankfurt, Germany, as Registrar. Each hereby accepts such appointments. The Transfer Agent, the Principal Paying Agent and the Registrar and any authenticating agent are collectively referred to in this Indenture as the “Agents”. The roles, duties and functions of the Agents are of a mechanical nature and each Agent shall only perform those acts and duties as specifically set out in this Indenture and no other acts, covenants, obligations or duties shall be implied or read into this Indenture against any of the Agents. For the avoidance of doubt, a Paying Agent’s obligation to disburse any funds shall be subject to prior receipt by it of those funds to be disbursed.
Subject to any applicable laws and regulations, the Issuers shall cause the Registrar to keep a register (the “Security Register”) at its corporate trust office in which, subject to such reasonable regulations it may prescribe, the Issuers shall provide for the registration of ownership, exchange, and transfer of the Notes. Such registration in the Security Register shall be conclusive evidence of the ownership of Notes. Included in the books and records for the Notes shall be notations as to whether such Notes have been paid, exchanged or transferred, canceled, lost, stolen, mutilated or destroyed and whether such Notes have been replaced. In the case of the replacement of any of the Notes, the Registrar shall keep a record of the Note so replaced and the Note issued in replacement thereof. In the case of the cancellation of any of the Notes, the Registrar shall keep a record of the Note so canceled and the date on which such Note was canceled.
The Issuers shall enter into an appropriate agency agreement with any Paying Agent or co-Registrar not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuers shall notify the Trustee of the name and address of any such agent. If the Issuers fail to maintain a Registrar or Paying Agent, the Trustee may appoint a suitably qualified and reputable party to act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.05.
obliged to remit money to Holders if it has actually received such money from the Issuers. The Issuers shall require each Paying Agent other than the Trustee (including where acting as the Principal Paying Agent) to agree in writing that such Paying Agent shall hold for the benefit of the Trustee all money held by the Paying Agent for the payment of principal of, premium, if any, and interest on the Notes (whether such money has been paid to it by the Issuers or any other obligor on the Notes), and such Paying Agent shall promptly notify the Trustee of any default by the Issuers (or any other obligor on the Notes) in making any such payment. The Issuers at any time may require a Paying Agent to pay all money held by it to the Trustee and account for any funds disbursed, and the Trustee may at any time during the continuance of any payment default, upon written request to a Paying Agent, require such Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed. Upon doing so, the Paying Agent shall have no further liability for the money so paid over to the Trustee. If the Issuers or any Affiliate of the Issuers acts as Paying Agent, it shall, on or before each due date of any principal, premium, if any, or interest on the Notes, segregate and hold in a separate trust fund for the benefit of the Holders a sum of money sufficient to pay such principal, premium, if any, or interest so becoming due until such sum of money shall be paid to such Holders or otherwise disposed of as provided in this Indenture, and shall promptly notify the Trustee of its action or failure to act. |
The Trustee may, if the Issuers have notified it in writing that the Issuers intend to effect a defeasance or to satisfy and discharge this Indenture in accordance with the provisions of Article Eight, notify the Paying Agent in writing of this fact and require the Paying Agent (until notified by the Trustee to the contrary), to act thereafter as Paying Agent of the Trustee and not the Issuers in relation to any amounts deposited with it in accordance with the provisions of Article Eight.
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(a) Where Notes are presented to the Registrar or a co-Registrar with a request to register a transfer or to exchange them for an equal principal amount of Notes of other denominations, the Registrar shall register the transfer or make the exchange in accordance with the requirements of this Section 2.06. To permit registration of transfers and exchanges, the Issuers shall execute and the Trustee (or the authenticating agent) shall, upon receipt of an Issuers Order, authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes, of any authorized denominations and of a like aggregate principal amount, at the Registrar’s request, provided that no Note of less than $200,000 may be transferred or exchanged. No service charge shall be made for any registration of transfer or exchange of Notes (except as otherwise expressly permitted herein), but the Issuers may require payment of a sum sufficient to cover any agency fee or similar charge payable in connection with any such registration of transfer or exchange of Notes (other than any agency fee or similar charge payable in connection with any redemption of the Notes or upon exchanges pursuant to Sections 2.10, 3.07 or 9.05) or in accordance with an Excess Proceeds Offer pursuant to Section 4.09 or Change of Control Offer pursuant to Section 4.11, not involving a transfer. |
Upon presentation for exchange or transfer of any Note as permitted by the terms of this Indenture and by any legend appearing on such Note, such Note shall be exchanged or transferred upon the Security Register and one or more new Notes shall be authenticated and issued in the name of the Holder (in the case of exchanges only) or the transferee, as the case may be. No exchange or transfer of a Note shall be
effective under this Indenture unless and until such Note has been registered in the name of such Person in the Security Register. Furthermore, the exchange or transfer of any Note shall not be effective under this Indenture unless the request for such exchange or transfer is made by the Holder or by a duly authorized attorney-in-fact at the office of the Registrar.
Every Note presented or surrendered for registration of transfer or for exchange shall (if so required by the Issuers or the Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Issuers and the Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.
All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuers evidencing the same indebtedness, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.
Neither the Issuers nor the Trustee, Registrar or any Paying Agent shall be required (i) to issue, register the transfer of, or exchange any Note during a period beginning at the opening of 15 Business Days before the day of the mailing of a notice of redemption of Notes selected for redemption under Section 3.02 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.
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(b) Notwithstanding any provision to the contrary herein, so long as a Global Note remains outstanding and is held by or on behalf of DTC, transfers of a Global Note, in whole or in part, or of any beneficial interest therein, shall only be made in accordance with Section 2.01(c), Section 2.06(a) and this Section 2.06(b); provided, that a beneficial interest in a Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Global Note in accordance with the transfer restrictions set forth in the restricted Note legend on the Note, if any. |
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(i) Except for transfers or exchanges made in accordance with any of clauses (ii) through (iii) of this Section 2.06(b), transfers of a Global Note shall be limited to transfers of such Global Note in whole, but not in part, to nominees of DTC or to a successor of DTC or such successor’s nominee. |
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(ii) Restricted Global Note to Regulation S Global Note. If the holder of a beneficial interest in the Restricted Dollar Global Note at any time wishes to exchange its interest in such Restricted Global Note for an interest in the Regulation S Global Note, or to transfer its interest in such Restricted Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Global Note, such transfer or exchange may be effected, only in accordance with this clause (ii) and the rules and procedures of DTC (the “Applicable Procedures”). Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Global Note and shall increase or cause to be increased the principal amount of the Regulation S Global Note by the aggregate principal amount of the interest in the Restricted Global Note to be exchanged or transferred. |
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(iii) Regulation S Global Note to Restricted Global Note. If the holder of a beneficial interest in the Regulation S Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Global Note, such transfer may be effected only in accordance with this clause (iii) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuers or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Global Note and to increase or cause to be increased the principal amount of the Restricted Global Note by the aggregate principal amount of the interest in such Regulation S Global Note to be exchanged or transferred. |
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(c) If Notes are issued upon the transfer, exchange or replacement of Notes bearing the restricted Notes legends set forth in Exhibit A, the Notes so issued shall bear the restricted Notes legends, and a request to remove such restricted Notes legends from Notes shall not be honored unless there is delivered to the Issuers such satisfactory evidence, which may include an Opinion of Counsel licensed to practice law in the State of New York, as may be reasonably required by the Issuers, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A or Rule 144 under the Securities Act. Upon provision of such satisfactory evidence, the Trustee, at the direction of the Issuers, shall (or shall direct the authenticating agent to) authenticate and deliver Notes that do not bear the legend. |
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(d) The Trustee and the Agents shall have no responsibility for any actions taken or not taken by DTC. |
In the event any such mutilated, lost, destroyed or wrongfully taken Note has become or is about to become due and payable, the Issuers in its discretion may pay such Note instead of issuing a new Note in replacement thereof.
Every replacement Note shall be an additional obligation of the Issuers.
The provisions of this Section 2.07 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or wrongfully taken Notes.
If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory to them that the Note that has been replaced is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal, interest and Additional Amounts, if any, payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
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(a) A Global Note deposited with a custodian for DTC, pursuant to Section 2.01 shall be transferred in whole to the beneficial owners thereof in the form of certificated Notes only if such transfer complies with Section 2.06 and (i) DTC notifies the Issuers that it is unwilling or unable to continue to act as depositary and a successor depositary is not appointed by the Issuers within 120 days of such notice, or (ii) the owner of a Book-Entry Interest requests such an exchange in writing delivered through DTC following an Event of Default under this Indenture. Notice of any such transfer shall be given by the Issuers in accordance with the provisions of Section 12.02(a). |
Notes will be registrable, at the office or agency of the Issuers maintained for such purposes in accordance with Section 2.03. Such certificated Notes shall bear the applicable legends set forth in Exhibit A hereto. |
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(c) In the event of the occurrence of any of the events specified in Section 2.10(a), the Issuers shall promptly make available to the Trustee and the authenticating agent a reasonable supply of certificated Notes in definitive, fully registered form without interest coupons. |
The Issuers may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes are registered at the close of business on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Issuers shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment, and at the same time the Issuers may deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest; or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided in this clause. In addition, the Issuers shall fix a special record date for the payment of such Defaulted Interest, such date to be not more than 15 days and not less than 10 days prior to the proposed payment date and not less than 15 days after the receipt by the Trustee of the notice of the proposed payment date. The Issuers shall promptly but, in any event, not less than 15 days prior to the special record date, notify the Trustee of such special record date and, in the name and at the expense of the Issuers, the Trustee shall cause notice of the proposed payment date of such Defaulted Interest and the special record date therefor to be mailed first-class, postage prepaid to each Holder as such Holder’s address appears in the Security Register, not less than 10 days prior to such special record date. Notice of the proposed payment date of such Defaulted Interest and the special record date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes are registered at the close of business on such special record date and shall no longer be payable pursuant to Section 2.12(b).
The Issuers may make payment of any Defaulted Interest on the Notes in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Issuers to the Trustee of the proposed payment date pursuant to this clause, such manner of payment shall be deemed reasonably practicable.
Subject to the foregoing provisions of this Section 2.12, each Note delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.
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SECTION 2.13. Computation of Interest. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. |
The Issuers shall give each notice to the Trustee provided for in this Section 3.02 in writing at least 10 days before the date notice is mailed to the Holders pursuant to Section 3.04 unless the Trustee consents to a shorter period. Such notice shall be accompanied by an Officer’s Certificate from the Issuers to the effect that such redemption will comply with the conditions herein. If fewer than all the Notes are to be redeemed, the record date relating to such redemption shall be selected by the Issuers and given to the Trustee.
The Trustee or the Registrar shall make the selection from the Notes outstanding and not previously called for redemption. The Trustee or the Registrar may select for redemption portions equal to $1,000 in principal amount and any integral multiple thereof; provided that no Notes of $200,000 in principal amount or less may be redeemed in part. Provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee or the Registrar, as applicable, shall notify the Issuers promptly in writing of the Notes or portions of Notes to be called for redemption.
Neither the Trustee nor the Registrar shall be liable for selections made in accordance with the provisions of this Section 3.03.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such redemption or notice shall state that in the Issuers’ discretion, the Redemption Date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the Redemption Date or by the Redemption Date so delayed.
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(a) At least 10 days but not more than 60 days before a date for redemption of the Notes, the Issuers shall mail a notice of redemption by first-class mail to each Holder to be redeemed and shall comply with the provisions of Section 12.02(b). |
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(b) The notice shall identify the Notes to be redeemed (including ISIN and CUSIP numbers, as applicable) and shall state: |
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(i) the Redemption Date and the record date; |
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(ii) the appropriate calculation of the Redemption Price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid; |
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(iii) the name and address of the Paying Agent; |
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(iv) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any, and Additional Amounts, if any; |
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(v) that, if any Note is being redeemed in part, the portion of the principal amount (equal to $1,000 in principal amount or any integral multiple thereof) of such Note to be redeemed and that, on and after the Redemption Date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be reissued; |
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(vi) that, if any Note contains an ISIN or CUSIP number, no representation is being made as to the correctness of such ISIN or CUSIP number either as printed on the Notes or as contained in the notice of redemption and that reliance may be placed only on the other identification numbers printed on the Notes; |
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(vii) that, unless the Issuers and the Guarantors default in making such redemption payment, interest on the Notes (or portion thereof) called for redemption shall cease to accrue on and after the Redemption Date; |
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(viii) the paragraph of the Notes pursuant to which the Notes called for redemption are being redeemed; and |
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(ix) whether the redemption is conditioned on any events and, if so, the notice shall specify such events. |
At the Issuers’ written request, the Trustee shall give a notice of redemption in the Issuers’ name and at the Issuers’ expense. In such event, the Issuers shall provide the Trustee with the notice and the other information required by this Section 3.04.
Notice of redemption shall be deemed to be given when mailed, whether or not the Holder receives the notice. In any event, failure to give such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of Notes held by Holders to whom such notice was properly given.
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(a) Upon surrender of a Global Note that is redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on the Security Register to reduce the principal amount of such Global Note to an amount equal to the unredeemed portion of the Global Note surrendered; provided that each such Global Note shall be in a principal amount at final Stated Maturity of $200,000 or an integral multiple of $1,000 in excess thereof. |
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(b) Upon surrender and cancellation of a certificated Note that is redeemed in part, the Issuers shall execute and the Trustee shall authenticate for the Holder (at the Issuers’ expense) a new Note equal in principal amount to the unredeemed portion of the Note surrendered and canceled; provided that each such certificated Note shall be in a principal amount at final Stated Maturity of $200,000 or an integral multiple of $1,000 in excess thereof. |
The Issuers or the Guarantors shall pay interest on overdue principal at the rate specified therefor in the Notes. The Issuers or the Guarantors shall pay interest on overdue installments of interest at the same rate to the extent lawful.
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(a) The Parent Guarantor shall deliver to the Trustee, within 120 days after the end of each fiscal year or within 14 days of written request by the Trustee, an Officer’s Certificate stating that in the course of the performance by the signer of its duties as an officer of the Parent Guarantor he would normally have knowledge of any Default and whether or not the signer knows of any Default that occurred during such period and if any specifying such Default, its status and what action the Parent Guarantor is taking or proposed to take with respect thereto. For purposes of this Section 4.05(a), such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. |
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(b) If the Parent Guarantor or the Issuers shall become aware that (i) any Default or Event of Default has occurred and is continuing or (ii) any Holder seeks to exercise any remedy hereunder with respect to a claimed Default under this Indenture or the Notes, the Parent Guarantor or the Issuers, as the case may be, shall immediately deliver to the Trustee an Officer’s Certificate specifying such event, notice or other action (including any action the Parent Guarantor or the Issuers are taking or propose to take in respect thereof). |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, create, issue, incur, assume, guarantee or in any manner become directly or indirectly liable with respect to or otherwise become responsible for, contingently or otherwise, the payment of (individually and collectively, to “incur” or, as appropriate, an “incurrence”), any Debt (including any Acquired Debt); provided that the Parent Guarantor, each Issuer and any Restricted Subsidiary shall be permitted to incur Debt (including Acquired Debt) if in each case (i) after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, no Default or Event of Default would occur or be continuing and (ii) at the time of such incurrence and after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio for the four full fiscal quarters for which financial statements are available immediately preceding the incurrence of such Debt, taken as one period, would be greater than 2.0 to 1.0. |
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(b) Section 4.06(a) shall not, however, prohibit the following (collectively, “Permitted Debt”): |
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(i) the Notes and the New Secured Notes issued on the Issue Date; |
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(ii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Credit Facilities in an aggregate principal amount not to exceed the greater of (i) (x)at any time prior to the completion of the Disposition, $850,000,000 or (y) at any time after the completion of the Disposition, $700,000,000 and (ii) an amount equal to (I) 85.0% of Total Receivables plus 70.0% of Total Inventories less (II) $275,000,000; |
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(iii) any Existing Debt of the Parent Guarantor or any Restricted Subsidiary (other than Debt described in clauses (i) and (ii) of this Section 4.06(b)); |
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(iv) the incurrence by the Parent Guarantor or any Restricted Subsidiary of intercompany Debt between the Parent Guarantor and any Restricted Subsidiary or between or among Restricted Subsidiaries; provided that: |
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(A) if an Issuer or a Guarantor is the obligor on any such Debt, unless required by a Credit Facility and only to the extent legally permitted, such Debt must be unsecured (except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with cash management, cash pooling, tax and accounting operations of the Parent Guarantor and its Restricted Subsidiaries); and |
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(B) (x) any disposition, pledge or transfer of any such Debt to a Person (other than a disposition, pledge or transfer to the Parent Guarantor or a Restricted Subsidiary) and (y) any transaction pursuant to which any Restricted Subsidiary that has Debt owing by the Parent Guarantor or another Restricted Subsidiary ceases to be a Restricted Subsidiary, will, in each case, be deemed to be an incurrence of such Debt not permitted by this clause (iv); |
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(v) guarantees of the Parent Guarantor or any Restricted Subsidiary of Debt of the Parent Guarantor or any Restricted Subsidiary to the extent that the guaranteed Debt was permitted to be incurred by another provision of this Section 4.06; |
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(vi) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt represented by Capitalized Lease Obligations, mortgage financings, purchase money obligations or other Debt incurred or assumed in connection with the acquisition or development of real or personal, movable or immovable, property or assets, in each case, incurred for the purpose of financing or refinancing all or any part of the purchase price, lease expense or cost of construction or improvement of property, plant, equipment or other assets used in the Parent Guarantor’s or any Restricted Subsidiary’s business (including any reasonable related fees or expenses incurred in connection with such acquisition or development); provided that the principal amount of such Debt so incurred when aggregated with other Debt previously incurred in reliance on this clause (vi) and still outstanding shall not in the aggregate exceed the greater of $510,000,000 and 6.0% of Total Assets; and provided, further, that the total principal amount of any Debt incurred in connection with an acquisition or development permitted under this clause (vi) did not in each case at the time of incurrence exceed (A) the Fair Market Value of the acquired or constructed asset or improvement so financed or (B) in the case of an uncompleted constructed asset, the amount of the asset to be constructed, as determined on the date the contract for construction of such asset was entered into by the Parent Guarantor or the relevant Restricted Subsidiary (including, in each case, any reasonable related fees and expenses incurred in connection with such acquisition, construction or development); |
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(vii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt arising from agreements providing for guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock (other than guarantees or similar credit support given by the Parent Guarantor or any Restricted Subsidiary of Debt incurred by any Person acquiring all or any portion of such assets for the purpose of financing such acquisition); provided that the maximum aggregate liability in respect of all such Debt permitted pursuant to this clause (vii) shall at no time exceed the net proceeds, including non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received from the sale of such assets; |
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(viii) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Commodity Hedging Agreements not for speculative purposes; |
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(ix) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Currency Agreements not for speculative purposes; |
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(x) the incurrence by the Parent Guarantor or any Restricted Subsidiary of Debt under Interest Rate Agreements not for speculative purposes; |
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(xi) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary of Debt in respect of workers’ compensation and claims arising under similar legislation, or pursuant to self-insurance obligations and not in connection with the borrowing of money or the obtaining of advances or credit; |
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(xii) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary arising from (A) the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Debt is extinguished within five Business Days of incurrence, (B) bankers’ acceptances, performance, surety, judgment, completion, payment, appeal or similar bonds, instruments or obligations, (C) completion guarantees, advance payment, customs, VAT or other tax guarantees or similar instruments provided or letters of credit obtained by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business, and (D) the financing of insurance premiums in the ordinary course of business; |
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(xiii) any Debt of the Parent Guarantor or any Restricted Subsidiary incurred pursuant to any Permitted Receivables Financing; |
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(xiv) the incurrence by a Person of Permitted Refinancing Debt in exchange for or the net proceeds of which are used to refund, replace or refinance Debt incurred by it pursuant to, or described in, Section 4.06(a), sub clauses (i) and (iii), this sub-clause (xiv) and sub-clauses (xviii), (xix) and (xx) of this Section 4.06(b), as the case may be; |
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(xv) guarantees by the Parent Guarantor or a Restricted Subsidiary of Debt incurred by Permitted Joint Ventures in an aggregate principal amount at any one time outstanding not to exceed an amount equal to the greater of $150,000,000 and 2.0% of Total Assets; |
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(xvi) cash management obligations and Debt in respect of netting services, pooling arrangements or similar arrangements in connection with cash management in the ordinary course of business consistent with past practice; |
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(xvii) (i) take-or-pay obligations in the ordinary course of business, (ii) customer deposits and advance payments in the ordinary course of business received from customers for goods or services purchased in the ordinary course of business and (iii) manufacturer, vendor financing, customer and supply arrangements in the ordinary course of business; |
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(xviii) the incurrence of Debt by the Parent Guarantor or any Restricted Subsidiary (other than and in addition to Debt permitted under clauses (i) through (xvii) above and clauses (xix) and (xx) below) in an aggregate principal amount at any one time outstanding not to exceed, together with any Permitted Refinancing Debt in respect thereof, the greater of $350,000,000 and 5.0% of Total Assets; |
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(xix) Debt of any Person (x) incurred and outstanding on the date on which such Person becomes a Restricted Subsidiary of the Parent Guarantor or another Restricted Subsidiary of the Parent Guarantor or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Parent Guarantor or any Restricted Subsidiary or (y) incurred to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary; provided, however, with respect to each of sub-clause (x) and (y) of this Section 4.06(b)(xix), that at the time of such acquisition or other transaction (1) the Parent Guarantor would |
have been able to incur $1.00 of additional Debt pursuant to Section 4.06(a) after giving effect to the incurrence of such Debt pursuant to this Section 4.06(b)(xix) or (2) the Fixed Charge Coverage Ratio of the Parent Guarantor and its Restricted Subsidiaries would not be less than it was immediately prior to giving pro forma effect to such acquisition or other transaction; |
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(xx) Contribution Debt; and |
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(xxi) Debt consisting of local lines of credit, overdraft facilities or local working capital facilities in an aggregate outstanding principal amount at any one time not to exceed the greater of $75,000,000 and 1.0% of Total Assets. |
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(c) Accrual of interest or dividends, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest or dividends in the form of additional Debt of the same class will not be deemed to be an incurrence of Debt for purposes of this Section 4.06. |
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(d) For purposes of determining compliance with any restriction on the incurrence of Debt in U.S. dollar where Debt is denominated in a different currency, the amount of such Debt will be the Dollar Equivalent determined on the date of such determination; provided that if any such Debt denominated in a different currency is subject to a Currency Agreement (with respect to U.S. dollars) covering principal amounts payable on such Debt, the amount of such Debt expressed in U.S. dollars shall be adjusted to take into account the effect of such agreement. The principal amount of any Permitted Refinancing Debt incurred in the same currency as the Debt being refinanced shall be the Dollar Equivalent of the Debt refinanced determined on the date such Debt being refinanced was initially incurred. Notwithstanding any other provision of this Section 4.06, for purposes of determining compliance with this Section 4.06, increases in Debt solely due to fluctuations in the exchange rates of currencies will not be deemed to exceed the maximum amount that an Issuer, the Parent Guarantor or a Subsidiary Guarantor may incur under this Section 4.06. |
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(e) For purposes of determining any particular amount of Debt under this Section 4.06: |
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(i) obligations with respect to letters of credit, guarantees or Liens, in each case supporting Debt otherwise included in the determination of such particular amount shall not be included; |
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(ii) any Liens granted pursuant to the equal and ratable provisions referred to in Section 4.07 shall not be treated as Debt; |
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(iii) accrual of interest, accrual of dividends, the accretion of accreted value, the obligation to pay commitment fees and the payment of interest in the form of additional preferred stock or Debt shall not be treated as Debt; and |
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(iv) the reclassification of preferred stock as Debt due to a change in accounting principles shall not be treated as Debt. |
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(f) In the event that an item of Debt meets the criteria of more than one of the types of Debt described in this Section 4.06, the Parent Guarantor, in its sole discretion, shall classify items of Debt and shall only be required to include the amount and type of such Debt in one of such clauses and the Parent Guarantor shall be entitled to divide and classify an item of Debt in more than one of the types of Debt described in this Section 4.06, and may change the classification of an item of Debt (or any portion thereof) to any other type of Debt described in this Section 4.06 at any time. |
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(g) The amount of any Debt outstanding as of any date will be: |
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(i) in the case of any Debt issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS; |
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(ii) the principal amount of the Debt, in the case of any other Debt; and |
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(iii) in respect of Debt of another Person secured by a Lien on the assets of the specified Person, the lesser of: |
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(A) the Fair Market Value of such assets at the date of determination; and |
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(B) the amount of the Debt of the other Person. |
in the case of any Lien securing Subordinated Debt, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Subordinated Debt of a Guarantor) are directly secured by a Lien on such property, assets or proceeds that is senior in priority to the Lien securing the Subordinated Debt until such time as the Subordinated Debt is no longer secured by a Lien; and
in the case of any other Lien, the Issuers’ obligations in respect of the Notes (or a Guarantee in the case of Liens securing Debt of a Guarantor), and all other amounts due under this Indenture are equally and ratably secured with the obligation or liability secured by such Lien.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, take any of the following actions (each of which is a “Restricted Payment” and which are collectively referred to as “Restricted Payments”): |
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(i) declare or pay any dividend on or make any distribution (whether made in cash, securities or other property) with respect to any of the Parent Guarantor’s or any Restricted Subsidiary’s Capital Stock (including, without limitation, any payment in connection with any merger or consolidation involving the Parent Guarantor or any Restricted Subsidiary) (other than (A) to the Parent Guarantor or any Restricted Subsidiary or (B) to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Parent Guarantor or a Restricted Subsidiary of dividends or distributions of greater value than the Parent Guarantor or such Restricted Subsidiary would receive on a pro rata basis; provided that any amount so paid or distributed to holders of Capital Stock of a Restricted Subsidiary other than the Parent Guarantor or a Restricted Subsidiary shall be included in the calculation of the aggregate amount of all Restricted Payments declared or made after July 1, 2014 for the purposes of Section 4.08(b)), except for dividends or distributions payable solely in shares of the Parent Guarantor’s |
Qualified Capital Stock or in options, warrants or other rights to acquire such shares of Qualified Capital Stock, or make any payment of cash interest on Deeply Subordinated Funding; |
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(ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation), directly or indirectly, any shares of the Parent Guarantor’s Capital Stock held by persons other than the Parent Guarantor or a Restricted Subsidiary (other than Capital Stock of any Restricted Subsidiary or any entity that becomes a Restricted Subsidiary as a result thereof) or any options, warrants or other rights to acquire such shares of Capital Stock; |
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(iii) make any principal payment on, or repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled principal payment, sinking fund payment or maturity, any Subordinated Debt or any Deeply Subordinated Funding; or |
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(iv) make any Investment (other than any Permitted Investment) in any Person. |
If any Restricted Payment described in this Section 4.08(a) is not made in cash, the amount of the proposed Restricted Payment shall be the Fair Market Value of the asset to be transferred as of the date of transfer.
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(b) Notwithstanding Section 4.08(a), the Parent Guarantor or any Restricted Subsidiary may make a Restricted Payment if, at the time of and after giving pro forma effect to such proposed Restricted Payment: |
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(i) no Default or Event of Default has occurred and is continuing; |
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(ii) the Parent Guarantor could incur at least $1.00 of additional Debt (other than Permitted Debt) pursuant to Section 4.06; and |
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(iii) the aggregate amount of all Restricted Payments declared or made after July 1, 2014 does not exceed the sum of: |
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(A) 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during the period beginning on July 1, 2014 and ending on the last day of the Parent Guarantor’s last fiscal quarter ending prior to the date of such proposed Restricted Payment (or, if such aggregate cumulative Consolidated Adjusted Net Income shall be a negative number, minus 100% of such negative amount),; plus |
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(B) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received by the Parent Guarantor as a contribution to its common equity capital after the Issue Date or from the issuance or sale (other than to any Subsidiary) of shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (including upon the exercise of options, warrants or rights) or warrants, options or rights to purchase shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (except, in each case to the extent such proceeds are used to purchase, redeem or otherwise retire Capital Stock or Subordinated Debt or Deeply Subordinated Funding as set forth in sub-clause (ii) or (iii) of Section 4.08(c) or constitute an Excluded Contribution or the proceeds of any Contribution Debt) (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed |
from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid and Excluded Contributions); plus |
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(C) (x) the amount by which the Parent Guarantor’s Debt or Debt of any Restricted Subsidiary is reduced after the Issue Date upon the conversion or exchange (other than by the Parent Guarantor or its Subsidiary) of such Debt into the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, and (y) the aggregate Net Cash Proceeds, and the Fair Market Value of property or assets or marketable securities, received after the Issue Date by the Parent Guarantor from the issuance or sale (other than to any Subsidiary) of Redeemable Capital Stock that has been converted into or exchanged for the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding, to the extent such Redeemable Capital Stock was originally sold for cash or Cash Equivalents, together with, in the case of both sub-clauses (x) and (y) of this Section 4.08(b)(iii)(C), the aggregate Net Cash Proceeds received by the Parent Guarantor at the time of such conversion or exchange (excluding the Net Cash Proceeds from the issuance of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding financed, directly or indirectly, using funds borrowed from the Parent Guarantor or any Subsidiary until and to the extent such borrowing is repaid); plus |
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(D) (x) in the case of the disposition or repayment of any Investment constituting a Restricted Payment made after the Issue Date, an amount (to the extent not included in Consolidated Adjusted Net Income) equal to the cash proceeds of such disposition or repayment or the Fair Market Value of property received by the Parent Guarantor or a Restricted Subsidiary thereof, in either case, less the cost of the disposition of such Investment and net of taxes, and (y) in the case of the designation of an Unrestricted Subsidiary as a Restricted Subsidiary (as long as the designation of such Subsidiary as an Unrestricted Subsidiary was deemed a Restricted Payment), the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary; provided that such amount shall not in any case exceed the amount of the Restricted Payment deemed made at the time that the Subsidiary was designated as an Unrestricted Subsidiary, plus |
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(E) $80,000,000. |
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(c) Notwithstanding clauses (a) and (b) of this Section 4.08, the Parent Guarantor and any Restricted Subsidiary may take the following actions (“Permitted Payments”) so long as (with respect to sub-clauses (viii), (xi), (xii) and (xvii) of this clause (c)) no Default or Event of Default has occurred and is continuing: |
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(i) the payment of any dividend within 180 days after the date of its declaration if at such date of its declaration such payment would have been permitted by this Section 4.08; |
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(ii) the repurchase, redemption or other acquisition or retirement for value of any shares of the Parent Guarantor’s Capital Stock or options, warrants or other rights to acquire such Capital Stock in exchange for (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares or scrip), or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock, options, warrants or other rights to acquire such Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iii) the repurchase, redemption, defeasance or other acquisition or retirement for value or payment of principal of any Subordinated Debt or Deeply Subordinated Funding in exchange for, or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Parent Guarantor) of, shares of the Parent Guarantor’s Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iv) the purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Debt (other than Redeemable Capital Stock) in exchange for, or out of the Net Cash Proceeds of a substantially concurrent incurrence (other than to a Subsidiary) of, Permitted Refinancing Debt; |
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(v) the repurchase of Capital Stock deemed to occur upon the exercise of stock options with respect to which payment of the cash exercise price has been forgiven if the cumulative aggregate value of such deemed repurchases does not exceed the cumulative aggregate amount of the exercise price of such options received; |
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(vi) payments or distributions to dissenting shareholders pursuant to applicable law in connection with or in contemplation of a merger, consolidation or transfer of assets that complies with the provisions of Article Five; |
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(vii) cash payments in lieu of issuing fractional shares pursuant to the exchange or conversion of any exchangeable or convertible securities; |
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(viii) cash payments, advances, loans or expense reimbursements made to any parent company of the Parent Guarantor to permit any such company to pay (i) general operating expenses, customary directors’ fees, accounting, legal, corporate reporting and administrative expenses incurred in the ordinary course of business in an amount not to exceed $25,000,000 in the aggregate in any fiscal year, and (ii) any taxes, duties or similar governmental fees of any such parent company to the extent such tax obligations are directly attributable to its ownership of the Parent Guarantor and its Restricted Subsidiaries; |
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(ix) any payments (including pursuant to a tax sharing agreement or similar arrangement) between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries files a consolidated tax return or with which the Parent Guarantor or any of its Restricted Subsidiaries is part of a group for tax purposes (including a fiscal unity) or any tax advantageous group contribution made pursuant to applicable legislation; provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand-alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(x) the repurchase, redemption or other acquisition or retirement, and any loans, advances, dividends or distributions by the Parent Guarantor to any direct or indirect parent company to repurchase, redeem or otherwise acquire or retire, for value of any Capital Stock of the Parent Guarantor or any Restricted Subsidiary or any direct or indirect parent company held by any current or former officer, director, employee or consultant of the Parent Guarantor or any of its Restricted Subsidiaries; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Capital Stock may not exceed $10,000,000 plus an amount equal to $10,000,000 multiplied by the number of years that have elapsed since the Issue Date; provided, further, that such amount in any calendar year may be increased by an amount not to exceed (A) the cash |
proceeds from the sale of Capital Stock of the Parent Guarantor or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Parent Guarantor, any of its Restricted Subsidiaries or any of its direct or indirect parent companies and (B) the cash proceeds of key man life insurance policies of the Parent Guarantor or a Restricted Subsidiary received by the Parent Guarantor or a Restricted Subsidiary after the Issue Date less any amount previously applied to the making of Restricted Payments pursuant to this clause (x), in each case, to the extent the cash proceeds have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.08(b)(iii)(B) or Section 4.08(c)(iii); |
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(xi) the declaration and payment by the Parent Guarantor of, or loans, advances, dividends or distributions to any parent company of the Parent Guarantor to pay, dividends on the common stock or common equity interests of the Parent Guarantor or any parent company following a Public Equity Offering, in an amount not to exceed in any fiscal year, 50% of aggregate Consolidated Adjusted Net Income on a cumulative basis during such fiscal year (the “Relevant Fiscal Year”); provided that such dividends shall be declared and paid no later than 180 days after the end of the Relevant Fiscal Year; |
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(xii) any other Restricted Payment; provided that the Consolidated Leverage Ratio of the Parent Guarantor on a pro forma basis after giving effect to any such Restricted Payment made pursuant to this clause (xii) but not including any Restricted Payment made in reliance on Section 4.08(b) or another clause of Section 4.08(c) (other than this sub-clause (xii)) does not exceed 5.25 to 1.0. |
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(xiii) Restricted Payments in an amount equal to the amount of Excluded Contributions made; |
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(xiv) the payment, purchase, redemption, defeasance or other acquisition or retirement for value of any Subordinated Debt of the Parent Guarantor and its Restricted Subsidiaries pursuant to Section 4.09 and Section 4.11; provided that, prior to such payment, purchase, redemption, defeasance or other acquisition or retirement for value, the Issuers or the Parent Guarantor has made a Change of Control Offer or Asset Sale Offer, as the case may be, with respect to Notes as a result of such Change of Control or Asset Sale, as the case may be, and has repurchased all such Notes validly tendered and not withdrawn in connection with such Change of Control Offer or Asset Sale Offer, as the case may be; |
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(xv) the declaration and payment of dividends to holders of any class or series of Redeemable Capital Stock incurred in accordance with Section 4.06; |
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(xvi) dividends or other distributions of Capital Stock of Unrestricted Subsidiaries; and |
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(xvii) any other Restricted Payment; provided that the total aggregate amount of Restricted Payments made under this clause (xvii) does not exceed the greater of $150,000,000 and 2.0% of Total Assets; and |
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(xviii) any Restricted Payment made in connection with the Transactions (including, for the avoidance of doubt, any payments contemplated by the Transaction Agreement), and any costs and expenses (including all legal, accounting and other professional fees and expenses) related thereto or used to fund amounts owed to Affiliates in connection with the Transactions (including dividends to any parent entity to permit payment by such parent entity of such amounts). |
The actions described in sub-clauses (i), (vi), (xi) and (xvii) of Section 4.08(c) are Restricted Payments that will be permitted to be made in accordance with this Section 4.08(c) but that reduce the amount that would otherwise be available for Restricted Payments under Section 4.08(b)(iii).
For purposes of determining compliance with this Section 4.08, in the event that a Restricted Payment meets the criteria of more than one of the categories described in sub-clauses (i) through (xviii) of Section 4.08(c), or is permitted pursuant to Section 4.08(a), the Parent Guarantor and its Restricted Subsidiaries will be entitled to classify such Restricted Payment (or portion thereof) on the date of its payment or later reclassify such Restricted Payment (or portion thereof) in any manner that complies with this Section 4.08. The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Parent Guarantor or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, consummate any Asset Sale unless: |
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(i) the consideration the Parent Guarantor or such Restricted Subsidiary receives for such Asset Sale is not less than the Fair Market Value of the assets sold (as determined in good faith by the Parent Guarantor’s Board of Directors); |
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(ii) at least 75% of the consideration the Parent Guarantor or such Restricted Subsidiary receives in respect of such Asset Sale consists of (A) cash (including any Net Cash Proceeds received from the conversion within 90 days of such Asset Sale of securities, notes or other obligations received in consideration of such Asset Sale); (B) Cash Equivalents; (C) the assumption by the purchaser of (x) the Parent Guarantor’s Debt or Debt of any Restricted Subsidiary (other than Subordinated Debt) as a result of which neither the Parent Guarantor nor any of the Restricted Subsidiaries remains obligated in respect of such Debt or (y) Debt of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, if the Parent Guarantor and each other Restricted Subsidiary is released from any guarantee of such Debt as a result of such Asset Sale; (D) Replacement Assets; (E) any Designated Non-cash Consideration received by the Parent Guarantor or such Restricted Subsidiary in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (ii), not to exceed the greater of $225,000,000 and 3.00% of Total Assets at the time of the receipt of such Designated Non-cash Consideration, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value; or (F) a combination of the consideration specified in sub-clauses (A) to (E) of this Section 4.09(a)(ii); and |
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(iii) the Parent Guarantor delivers an Officer’s Certificate to the Trustee certifying that such Asset Sale complies with the provisions described in sub-clauses (i) and (ii) of this Section 4.09(a). |
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(b) If the Parent Guarantor or any Restricted Subsidiary consummates an Asset Sale, the Net Cash Proceeds from such Asset Sale, within 360 days after the consummation of such Asset Sale, may be used by the Parent Guarantor or such Restricted Subsidiary to (A) permanently repay, purchase or prepay any then outstanding Debt (other than Debt that is subordinated to the Notes or the Guarantees of the Notes) of the Parent Guarantor or any Restricted Subsidiary (and to effect a corresponding commitment reduction if such Debt is revolving credit borrowings) owing to a Person other than the Parent Guarantor or a Restricted Subsidiary or (B) invest in any Replacement Assets, (C) acquire all or substantially all of the |
assets of, or any Capital Stock of, another Similar Business, if, after giving effect to any such acquisition of Capital Stock, the Similar Business is or becomes a Restricted Subsidiary, or (D) any combination of the foregoing; provided that in the case of sub-clause (B) of this Section 4.09(b), if the Parent Guarantor or such Restricted Subsidiary, as the case may be, has entered into a binding commitment in definitive form within such 360-day period to so apply such Net Cash Proceeds with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”), such binding commitment shall be treated as a permitted application of such Net Cash Proceeds; provided, further, that if any Acceptable Commitment is later cancelled or terminated for any reason before such Net Cash Proceeds are applied and after such initial 360-day period, then such Net Cash Proceeds shall constitute Excess Proceeds. The amount of such Net Cash Proceeds not so used as set forth in this Section 4.09(b) constitutes “Excess Proceeds”. The Parent Guarantor may reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. |
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(c) The Parent Guarantor or the Issuers may also at any time, and the Parent Guarantor or the Issuers shall within 20 Business Days after the aggregate amount of Excess Proceeds exceeds the greater of $100,000,000 and 1.5% of Total Assets, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in this Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of $1,000) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase. |
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(d) To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the Parent Guarantor may use the amount of such Excess Proceeds not used to purchase the Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by this Indenture. If the aggregate principal amount of the Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each Holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero. |
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(e) If the Parent Guarantor or the Issuers are obligated to make an Excess Proceeds Offer, the Parent Guarantor or the Issuers shall purchase the Notes and Pari Passu Debt, at the option of the holders thereof, in whole or in part (as an integral multiple of $1,000), on a date that is not earlier than 30 days and not later than 60 days from the date the notice of the Excess Proceeds Offer is given to such holders, or such later date as may be required under the Exchange Act provided that Notes of $200,000 will be purchased in full. |
If the Parent Guarantor or the Issuers are required to make an Excess Proceeds Offer, the Parent Guarantor and the Issuers shall comply with the applicable tender offer rules, including Rule 14e-1 under the Exchange Act, and any other applicable securities laws and regulations, including any securities laws of Ireland and the requirements of any applicable securities exchange on which Notes or the Existing Ardagh Bonds are then listed. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.09, the Issuers shall comply with such securities laws and regulations and shall not be deemed to have breached their obligations described in this Section 4.09 by virtue thereof.
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, enter into or suffer to exist any transaction or series of related transactions (including, without limitation, the sale, purchase, exchange or lease of assets or property or the rendering of any service) with, or for the benefit of, any Affiliate of the Parent Guarantor or any Restricted Subsidiary’s Affiliate involving aggregate consideration in excess of the greater of $75,000,000 and 2.0% of Total Assets unless: |
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(i) such transaction or series of transactions is on terms that, taken as a whole, are not materially less favorable to the Parent Guarantor or such Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable arm’s‑length transaction with third parties that are not Affiliates; and |
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(ii) with respect to any transaction or series of related transactions involving aggregate payments or the transfer of assets or provision of services, in each case having a value greater than the greater of $150,000,000 and 2.0% of Total Assets, the Parent Guarantor shall deliver a resolution of its Board of Directors (set out in an Officer’s Certificate to the Trustee) resolving that such transaction complies with Section 4.10(a)(i) and that the fairness of such transaction has been approved by a majority of the Disinterested Directors (or in the event there is only one Disinterested Director, by such Disinterested Director) of the Parent Guarantor’s Board of Directors. |
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(b) Notwithstanding the foregoing, the restrictions set forth in Section 4.10(a) will not apply to: |
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(i) customary directors’ fees, indemnification and similar arrangements (including the payment of directors’ and officers’ insurance premiums), consulting fees, employee salaries, bonuses, employment agreements and arrangements, compensation or employee benefit arrangements, including stock options or legal fees; |
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(ii) any Restricted Payment not prohibited by Section 4.08 or the making of an Investment that is a Permitted Investment; |
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(iii) the agreements and arrangements existing on the Issue Date and any amendment, modification or supplement thereto; provided that any such amendment, modification or supplement to the terms thereof is not more disadvantageous to the Holders and to the Parent Guarantor and the Restricted Subsidiaries, as applicable, in any material respect than the original agreement or arrangement as in effect on the Issue Date; |
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(iv) any payments or other transactions pursuant to a tax sharing agreement between the Parent Guarantor and any other Person or a Restricted Subsidiary and any other Person with which the Parent Guarantor or any of its Restricted Subsidiaries file a consolidated tax return or with which the Issuers are part of a consolidated group for tax purposes or any tax advantageous group contribution made pursuant to applicable legislation, provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Parent Guarantor and its Restricted Subsidiaries on a stand‑alone basis and the related tax liabilities of the Parent Guarantor and its Restricted Subsidiaries are relieved thereby; |
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(v) transactions in the ordinary course of business with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of the Parent Guarantor solely because the Parent Guarantor owns, directly or through a Restricted Subsidiary, Capital Stock in, or controls, such Person; |
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(vi) the issuance of securities pursuant to, or for the purpose of the funding of, employment arrangements, stock options, and stock ownership plans, as long as the terms thereof are or have been previously approved by the Parent Guarantor’s Board of Directors; |
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(vii) the granting and performance of registration rights for the Parent Guarantor’s securities; |
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(viii) (A) issuances or sales of Qualified Capital Stock of the Parent Guarantor or Deeply Subordinated Funding and (B) any amendment, waiver or other transaction with respect to any Deeply Subordinated Funding in compliance with the other provisions of this Indenture; |
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(ix) pledges by the Parent Guarantor or any Restricted Subsidiary of the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture securing Debt owing by such Unrestricted Subsidiary or a Permitted Joint Venture; |
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(x) transactions with a joint venture made in the ordinary course of business; |
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(xi) transactions between or among the Parent Guarantor and the Restricted Subsidiaries or between or among Restricted Subsidiaries; |
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(xii) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are fair to the Parent Guarantor or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Parent Guarantor or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person; |
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(xiii) any transaction effected as part of a Permitted Receivables Financing; |
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(xiv) pledges of equity interests of Unrestricted Subsidiaries; |
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(xv) any employment agreement, consultancy agreement or employee benefit arrangement with any employee, consultant, officer or director of the Parent Guarantor or any Restricted Subsidiary, including under any stock option, stock appreciation rights, stock incentive or similar plans, entered into in the ordinary course of business; and |
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(xvi) (x) the Transactions and the payment of all costs and expenses (including all legal, accounting and other professional fees and expenses) related to the Transactions or any payment as contemplated by the Transaction Agreement; (y) any transactions or services pursuant to the Mutual Services Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s length basis; and (z) any transactions or services pursuant to the IP Cross-License Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s length basis. |
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(a) If a Change of Control occurs at any time, then the Issuers or the Parent Guarantor shall make an offer (a “Change of Control Offer”) to each Holder to purchase such Holder’s Notes, at a purchase price (the “Change of Control Purchase Price”) in cash in an amount equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (the “Change of Control Purchase |
Date”) (subject to the rights of holders of record on relevant regular Record Dates that are prior to the Change of Control Purchase Date to receive interest due on an Interest Payment Date). |
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(b) Within 30 days following any Change of Control, the Issuers or the Parent Guarantor shall: |
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(i) cause a notice of the Change of Control Offer to be: |
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(A) delivered to holders of the Notes electronically or mailed by first-class mail, postage prepaid; and |
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(B) if at the time of such notice the Notes are listed on Euronext Dublin and the rules of Euronext Dublin so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) send notice of the Change of Control Offer by first‑class mail, with a copy to the Trustee, to each Holder to the address of such Holder appearing in the Security Register, which notice shall state: |
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(A) that a Change of Control has occurred, and the date it occurred; |
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(B) the circumstances and relevant facts regarding such Change of Control (including, but not limited to, applicable information with respect to pro forma historical income, cash flow and capitalization after giving effect to the Change of Control); |
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(C) the Change of Control Purchase Price and the Change of Control Purchase Date, which shall be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations; |
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(D) that any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Purchase Date unless the Change of Control Purchase Price is not paid; |
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(E) that any Note (or part thereof) not tendered shall continue to accrue interest; and |
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(F) any other procedures that a Holder must follow to accept a Change of Control Offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on Euronext Dublin). |
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(c) On the Change of Control Purchase Date, the Issuers shall, to the extent lawful: |
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(i) accept for payment all Notes or portions thereof (equal to $200,000 or an integral multiple of $1,000 in excess thereof) properly tendered pursuant to the Change of Control Offer; |
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(ii) deposit with the Paying Agent an amount equal to the Change of Control Purchase Price in respect of all Notes or portions thereof so tendered; and |
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(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Issuers. |
The Issuers or the Parent Guarantor will publicly announce the results of the Change of Control Offer on, or as soon as practical after, the Change of Control Purchase Date.
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(d) The Paying Agent shall promptly mail to each Holder that has properly tendered its Notes pursuant to the Change of Control Offer an amount equal to the Change of Control Purchase Price for such Notes and the Trustee shall itself or via the authenticating agent promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder a new Note or Notes equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note shall be in a principal amount of $200,000 and in integral multiples of $1,000 in excess thereof. |
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(e) If the Change of Control Purchase Date is on or after an interest Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest, if any, shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date, and no additional interest shall be payable to Holders who tender pursuant to the Change of Control Offer. |
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(f) Neither the Issuers nor the Parent Guarantor shall be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth herein applicable to a Change of Control Offer made by the Issuers or the Parent Guarantor and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. |
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(g) The Issuers and the Parent Guarantor shall comply with the applicable tender offer rules, including Rule 14e-l under the Exchange Act, and any other applicable securities laws and regulations in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Indenture, the Issuers and the Parent Guarantor shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under this Indenture by virtue of such conflict. |
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(h) Notwithstanding anything to the contrary contained in this Section 4.11, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. |
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(a) All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on the Notes or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, a Guarantor or other applicable withholding agent |
is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to the Notes or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted. |
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(b) None of the Issuers or Guarantors shall, however, pay Additional Amounts in respect or on account of: |
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(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of the Notes, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee); |
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(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of the Notes, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction); |
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(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes; |
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(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to the Notes or any Guarantee; |
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(v) any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note; |
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(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union; |
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(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Note been presented on the last day of such 30-day period); |
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(viii) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section |
1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or |
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(ix) any combination of the foregoing. |
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(c) The Issuers and the Guarantors, if the applicable withholding agents, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law. |
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(d) At least 30 calendar days prior to each date on which any payment under or with respect to the Notes or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to the Notes or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. |
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of the Notes or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, the Notes or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuer and the Guarantors (and not otherwise in the possession of the Trustee) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
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(e) Whenever this Indenture or the Notes refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to any Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable. |
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(f) This Section 4.12 will survive any termination, defeasance or discharge of this Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or |
its agents, including the Paying Agent) makes any payment on the Notes (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax. |
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(a) At the request and direction of the Parent Guarantor and without the consent of the Holders, in connection with the incurrence by the Parent Guarantor or its Restricted Subsidiaries of any Permitted Debt, the Parent Guarantor, the relevant Restricted Subsidiaries, the Trustee shall enter into with the Holders (or their duly authorized representatives) an intercreditor agreement (an “Additional Intercreditor Agreement”) or a restatement, amendment or other modification of the existing Intercreditor Agreement, in each case on substantially the same terms as the Intercreditor Agreement or terms not violating the terms of this Indenture (for such matters covered by this Indenture) or terms not affecting adversely the rights of the Holders of the Notes in material respects (for such matters not covered by this Indenture), including containing substantially the same terms with respect to release of Guarantees; provided that such Additional Intercreditor Agreement will not impose any personal obligations on the Trustee or, in the opinion of the Trustee, as applicable, adversely affect the rights, duties, liabilities or immunities of the Trustee under this Indenture or the Intercreditor Agreement. |
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(b) At the request and direction of the Parent Guarantor and without the consent of the Holders, the Trustee shall from time to time enter into one or more amendments to any Intercreditor Agreement to: (i) cure any ambiguity, omission, defect or inconsistency of any such agreement, (ii) increase the amount or types of Debt covered by any such agreement that may be incurred by an Issuer or a Guarantor that is subject to any such agreement (including with respect to any Intercreditor Agreement or Additional Intercreditor Agreement, the addition of provisions relating to new Debt ranking junior in right of payment to the Notes), (iii) add Restricted Subsidiaries to the Intercreditor Agreement or an Additional Intercreditor Agreement, (iv) amend the Intercreditor Agreement or any Additional Intercreditor Agreement in accordance with the terms thereof or (v) make any other change to any such agreement that does not violate the terms of this Indenture. The Parent Guarantor shall not otherwise direct the Trustee to enter into any amendment to any Intercreditor Agreement without the consent of the Holders of the majority in aggregate principal amount of the Notes then outstanding, except as otherwise permitted below under Article Nine, and the Parent Guarantor may only direct the Trustee to enter into any amendment to the extent such amendment does not impose any personal obligations on the Trustee or, in the opinion of the Trustee, adversely affect their respective rights, duties, liabilities or immunities under this Indenture or the Intercreditor Agreement or any Additional Intercreditor Agreement. |
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(c) In relation to any Intercreditor Agreement or Additional Intercreditor Agreement, the Trustee shall consent on behalf of the Holders to the payment, repayment, purchase, repurchase, defeasance, acquisition, retirement or redemption of any obligations subordinated to the Notes thereby; provided, however, that such transaction would comply with Section 4.08. |
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(d) Each Holder, by accepting a Note, shall be deemed to have agreed to and accepted the terms and conditions of the Intercreditor Agreement or any Additional Intercreditor Agreement (whether then entered into or entered into in the future pursuant to the provisions described in this Section 4.13) and to have directed the Trustee to enter into any such Additional Intercreditor Agreement. The Issuers shall make a copy of the Intercreditor Agreement or any Additional Intercreditor Agreement available for inspection by Holders during normal business hours on any Business Day upon prior written request at the offices of the Listing Agent. |
the Subsidiaries of the Parent Guarantor (other than the Issuers) that is a guarantor of the Existing Ardagh Bonds (other than Enville Limited and the F&S Carve-out Subsidiaries) becomes a Subsidiary Guarantor and (ii) if the Disposition has not been completed on or before April 14, 2020, each of the F&S Carve-out Subsidiaries that guarantees the Existing Ardagh Bonds becomes a Subsidiary Guarantor no later than 30 days following April 14, 2020 and, in connection therewith, cause such Subsidiary and entities to deliver such agreements, instruments, certificates and opinions of counsel that may be reasonably requested by the Trustee. |
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(a) The Parent Guarantor shall not permit any Restricted Subsidiary that is not an Issuer or a Guarantor, directly or indirectly, to guarantee, assume or in any other manner become liable for the payment of any Pari Passu Debt or Subordinated Debt of either Issuer (other than the Notes), the Parent Guarantor or any Subsidiary Guarantor, unless: |
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(i) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to this Indenture providing for a Guarantee of payment of the Notes by such Restricted Subsidiary on the same terms as the guarantee of such Debt; and |
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(ii) with respect to any guarantee of Subordinated Debt by such Restricted Subsidiary, any such guarantee shall be subordinated to such Restricted Subsidiary’s Guarantee with respect to the Notes at least to the same extent as such Subordinated Debt is subordinated to the Notes. |
This clause (a) shall not be applicable to any guarantees of any Restricted Subsidiary:
existing on the Issue Date, guaranteeing Debt under Credit Facilities permitted to be incurred pursuant to Section 4.06(b)(ii) and Section 4.06(b)(xiii) or guaranteeing Debt in an aggregate principal amount that is less than the greater of $100,000,000 and 1.5% of Total Assets;
that existed at the time such Person became a Restricted Subsidiary if the guarantee was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary; or
given to a bank or trust company having combined capital and surplus and undivided profits of not less than €500,000,000, whose debt has a rating, at the time such guarantee was given, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s, in connection with the operation of cash management programs established for the Parent Guarantor’s benefit or that of any Restricted Subsidiary.
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(b) Notwithstanding the foregoing, any Guarantee of the Notes created pursuant to the provisions described in Section 4.15(a) above may provide by its terms that it will be automatically and unconditionally released and discharged upon: |
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(i) any sale, exchange or transfer, to any Person who is not the Parent Guarantor or a Restricted Subsidiary of all of the Capital Stock owned by the Parent Guarantor and its other Restricted Subsidiaries in, or all or substantially all the assets of, such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by this Indenture); or |
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(ii) (with respect to any Guarantee created after the Issue Date) the release by the Holders of the applicable Issuer’s, the Parent Guarantor’s or the Subsidiary Guarantor’s Debt described in Section 4.15(a) above, of their Guarantee by such Restricted Subsidiary (including any |
deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee), at a time when: |
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(A) no other Debt of either Issuer, the Parent Guarantor or any Subsidiary Guarantor has been guaranteed by such Restricted Subsidiary; or |
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(B) the holders of all such other Debt that is guaranteed by such Restricted Subsidiary also release their guarantee by such Restricted Subsidiary (including any deemed release upon payment in full of all Obligations under such Debt other than as a result of payment under such Guarantee); or |
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(iii) the release of the Guarantees on the terms and conditions and in the circumstances described in Section 10.03. |
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(c) Notwithstanding the foregoing, the Parent Guarantor shall not be obligated to cause any such Restricted Subsidiary to guarantee the Notes to the extent that such Guarantee would reasonably be expected to give rise to or result in (A) any violation of applicable law, rule, regulation or order that cannot be avoided or otherwise prevented through measures reasonably available to the Parent Guarantor or such Restricted Subsidiary, (B) personal liability for the officers, directors or shareholders of such Restricted Subsidiary or (C) any significant cost, expense, liability or obligation (including with respect to any Taxes but excluding any reasonable guarantee or similar fee payable to the Parent Guarantor or a Restricted Subsidiary) other than any governmental or regulatory filings required as a result of, or any measures pursuant to sub-clause (A) of this Section 4.15(c) undertaken in connection with, such Guarantee, which cannot be avoided through measures reasonably available to the Parent Guarantor or the Restricted Subsidiary; provided, however, that any Restricted Subsidiary who directly or indirectly, guarantees, assumes or in any other manner become liable for the payment of any obligations under the Existing Ardagh Bonds shall also be required to Guarantee payment of the Notes on the same terms as the guarantee of such obligations. |
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(d) Each such additional Guarantee will be limited as necessary to recognize certain defenses generally available to guarantors (including those that relate to fraudulent conveyance or transfer, voidable preference, financial assistance, corporate purpose and corporate benefit, thin capitalization, distributable reserves, capital maintenance or similar laws, regulations or defenses affecting the rights of creditors generally) or other considerations under applicable law. |
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SECTION 4.16. Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries. |
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(a) The Parent Guarantor shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Restricted Subsidiary to: |
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(i) pay dividends, in cash or otherwise, or make any other distributions on or in respect of its Capital Stock or any other interest or participation in, or measured by, its profits; |
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(ii) pay any Debt owed to the Parent Guarantor or any other Restricted Subsidiary; |
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(iii) make loans or advances to the Parent Guarantor or any other Restricted Subsidiary; or |
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(iv) transfer any of its properties or assets to the Parent Guarantor or any other Restricted Subsidiary. |
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(b) The provisions of Section 4.16(a) shall not apply to: |
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(i) encumbrances and restrictions imposed by the Notes, the New Secured Notes, the Existing Ardagh Bonds, this Indenture, the indenture governing the New Secured Notes, any Credit Facility, the indentures governing the Existing Ardagh Bonds, the Intercreditor Agreement (or any Additional Intercreditor Agreement), the Senior Holdco Notes and the security documents related thereto or by other indentures or agreements governing other Debt incurred ranking equally with the Notes; |
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(ii) any customary encumbrances or restrictions created under any agreements with respect to Debt of the Parent Guarantor or any Restricted Subsidiary permitted to be incurred subsequent to the Issue Date pursuant to the provisions of Section 4.06, including encumbrances or restrictions imposed by Debt permitted to be incurred under Credit Facilities or any guarantees thereof in accordance with Section 4.06; provided that such agreements do not prohibit the payment of interest with respect to the Notes or the Guarantees absent a default or event of default under such agreement; |
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(iii) encumbrances or restrictions contained in any agreement in effect on the Issue Date (other than an agreement described in another sub-clause of this Section 4.16(b)); |
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(iv) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), encumbrances and restrictions that restrict in a customary manner the subletting, assignment or transfer of any properties or assets that are subject to a lease, license, conveyance or other similar agreement to which the Parent Guarantor or any Restricted Subsidiary is a party; |
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(v) encumbrances or restrictions contained in any agreement or other instrument of a Person (including its Subsidiaries), acquired by the Parent Guarantor or any Restricted Subsidiary in effect at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired (including its Subsidiaries); |
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(vi) encumbrances or restrictions contained in contracts for sales of Capital Stock or assets permitted by the provisions of Section 4.09 with respect to the assets or Capital Stock to be sold pursuant to such contract or in customary merger or acquisition agreements (or any option to enter into such contract) for the purchase or acquisition of Capital Stock or assets or any of the Parent Guarantor’s Subsidiaries by another Person; |
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(vii) with respect to restrictions or encumbrances referred to in Section 4.16(a)(iv), any customary encumbrances or restrictions pertaining to any asset or property subject to a Lien to the extent set forth in the security document or any related document governing such Lien; |
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(viii) encumbrances or restrictions imposed by applicable law or regulation or by governmental licenses, concessions, franchises or permits; |
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(ix) encumbrances or restrictions on cash or other deposits or net worth imposed by customers under contracts entered into the ordinary course of business; |
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(x) customary limitations on the distribution or disposition of assets or property in joint venture agreements entered into the ordinary course of business and in good faith by any Restricted Subsidiary; provided that such encumbrance or restriction is applicable only to such Restricted Subsidiary and its Subsidiaries; |
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(xi) in the case of Section 4.16(a)(iv), customary encumbrances or restrictions in connection with purchase money obligations, mortgage financings and Capitalized Lease Obligations for property acquired in the ordinary course of business; |
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(xii) any encumbrance or restriction arising by reason of customary non-assignment provisions in agreements; |
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(xiii) encumbrances or restrictions with respect to any Permitted Receivables Financing; provided that such encumbrances or restrictions are customarily required by the institutional sponsor or arranger of such Permitted Receivables Financing in similar types of documents relating to the purchase of similar receivables in connection with the financing thereof; |
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(xiv) encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to a Permitted Joint Venture; |
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(xv) encumbrances or restrictions incurred in accordance with Section 4.07; or |
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(xvi) any encumbrances or restrictions existing under any agreement that extends, renews, amends, modifies, restates, supplements, refunds, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing sub-clauses (i) through (xv); provided that the terms and conditions of any such encumbrances or restrictions are not materially less favorable, taken as a whole, to the Holders of the Notes than those under or pursuant to the agreement so extended, renewed, amended, modified, restated, supplemented, refunded, refinanced or replaced. |
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(a) The Parent Guarantor’s Board of Directors may designate any Subsidiary (including newly acquired or newly established Subsidiaries) to be an “Unrestricted Subsidiary” only if no Default has occurred and is continuing at the time of or after giving effect to such designation. |
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(b) In the event of any designation of a Subsidiary as an Unrestricted Subsidiary in accordance with this Section 4.17, the Parent Guarantor shall be deemed to have made an Investment constituting a Restricted Payment pursuant to Section 4.08 for all purposes of this Indenture in an amount equal to the greater of (i) the net book value of the Parent Guarantor’s interest in such Subsidiary calculated in accordance with IFRS or (ii) the Fair Market Value of the Parent Guarantor’s interest in such Subsidiary. |
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(c) The Parent Guarantor’s Board of Directors may designate any Unrestricted Subsidiary as a Restricted Subsidiary if: |
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(i) no Default or Event of Default has occurred and is continuing at the time of or will occur and be continuing after giving effect to such designation; and |
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(ii) (x) the Parent Guarantor could incur at least $1.00 of additional Debt (pursuant to Section 4.06(a)) or (y) the Fixed Charge Coverage Ratio would not be less than it was immediately |
prior to giving effect to such designation, in each case, on a pro forma basis taking into account such designation. |
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(d) Any designation of a Subsidiary as an Unrestricted Subsidiary or Restricted Subsidiary by the Parent Guarantor’s Board of Directors in accordance with this Section 4.17 shall be evidenced to the Trustee by filing a resolution of the Parent Guarantor’s Board of Directors with the Trustee giving effect to such designation and an Officer’s Certificate certifying that such designation complies with the foregoing conditions, and giving the effective date of such designation. Any such filing with the Trustee must occur within 45 days after the end of the Parent Guarantor’s fiscal quarter in which such designation is made (or, in the case of a designation made during the last fiscal quarter of the Parent Guarantor’s fiscal year, within 90 days after the end of such fiscal year). |
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SECTION 4.19. Reports to Holders. So long as any Notes are outstanding, the Issuers or the Parent Guarantor shall furnish to the Trustee: |
within 120 days after the end of each of the Parent Guarantor’s fiscal year’s annual reports containing the following information: (a) audited consolidated balance sheets of the Parent Guarantor as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Parent Guarantor for the two most recent fiscal years, including footnotes to such financial statements and the report of the Parent Guarantor’s independent auditors on the financial statements; (b) an operating and financial review of the audited financial statements, including a discussion of the results of operations, financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (c) a description of the business and management of the Parent Guarantor; and (d) material recent developments to the extent not previously reported;
within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Parent Guarantor’s quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year-to-date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Parent Guarantor, together with condensed footnote disclosure; (b) operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Parent Guarantor and any material change between the current quarterly period and the corresponding period of the prior year; and (c) material recent developments to the extent not previously reported; and
promptly after the occurrence of any material acquisition, disposition or restructuring of the Parent Guarantor and the Restricted Subsidiaries, taken as a whole, or any change of the entire Board of Directors, chairman of the Board of Directors, chief executive officer
or chief financial officer at the Parent Guarantor or change in auditors of the Parent Guarantor, a press release containing a description of such event.
In addition, the Issuers or the Parent Guarantor shall furnish to the Holders and to prospective investors, upon the requests of such Holders, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the Exchange Act by Persons who are not “affiliates” under the Securities Act.
The Issuers or the Parent Guarantor shall also make available copies of all reports furnished to the Trustee (a) on the website of the Ardagh group of companies and (b) through the newswire service of Bloomberg, or, if Bloomberg does not then operate, any similar agency.
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(a) The Parent Guarantor shall not, in a single transaction or through a series of transactions, consolidate with or merge with or into any other Person or sell, assign, convey, transfer, lease or otherwise |
dispose of, or take any action pursuant to any resolution passed by the Parent Guarantor’s Board of Directors or shareholders with respect to a demerger or division pursuant to which the Parent Guarantor would dispose of, all or substantially all of the Parent Guarantor’s properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) to any other Person or Persons and the Parent Guarantor shall not permit any Restricted Subsidiary to enter into any such transaction or series of transactions if such transaction or series of transactions, in the aggregate, would result in the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Parent Guarantor and its Restricted Subsidiaries on a consolidated basis to any other Person or Persons. |
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(b) Section 5.01(a) shall not apply if: |
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(i) at the time of, and immediately after giving effect to, any such transaction or series of transactions, either the Parent Guarantor will be the continuing corporation or the Person (if other than the Parent Guarantor) formed by or surviving any such consolidation or merger or to which such sale, assignment, conveyance, transfer, lease or disposition of all or substantially all the properties and assets of the Parent Guarantor and the Restricted Subsidiaries on a consolidated basis has been made (the “Surviving Entity”): |
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(A) will be a corporation duly incorporated and validly existing under the laws of any member state of the European Union or the European Economic Area, the United States of America, any state thereof, the District of Columbia, Canada, Switzerland, Australia or Bermuda; and |
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(B) expressly assumes, by a supplemental indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture, and the Notes and this Indenture shall remain in full force and effect as so supplemented; |
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(ii) immediately after giving effect to such transaction or series of transactions on a pro forma basis (and treating any Obligation of the Parent Guarantor or any Restricted Subsidiary incurred in connection with or as a result of such transaction or series of transactions as having been incurred by the Parent Guarantor or such Restricted Subsidiary at the time of such transaction), no Default or Event of Default will have occurred and be continuing; |
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(iii) immediately before and immediately after giving effect to such transaction or series of transactions on a pro forma basis (on the assumption that the transaction or series of transactions occurred on the first day of the four-quarter fiscal period immediately prior to the consummation of such transaction or series of transactions with the appropriate adjustments with respect to the transaction or series of transactions being included in such pro forma calculation), the Parent Guarantor (or the Surviving Entity if the Parent Guarantor is not the continuing obligor under this Indenture) could incur at least $1.00 of additional Debt under the provisions of Section 4.06; |
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(iv) any Subsidiary Guarantor, unless it is the other party to the transactions described in this Section 5.01, shall have by supplemental indenture confirmed that its Guarantee will apply to such Person’s obligations under this Indenture and the Notes; |
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(v) any of the Parent Guarantor’s or any Restricted Subsidiary’s property or assets would thereupon become subject to any Lien, the provisions of Section 4.07 are complied with; and |
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(vi) the Parent Guarantor or the Surviving Entity shall have delivered to the Trustee, in form and substance satisfactory to the Trustee, an Officer’s Certificate (attaching the computations to demonstrate compliance with Section 5.01(b)(iii)) and an opinion of independent counsel, each stating that such consolidation, merger, sale, assignment, conveyance, transfer, lease or other disposition, and if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with the requirements of this Indenture and that this Indenture and the Notes constitute legal, valid and binding obligations of the continuing person, enforceable in accordance with their terms. |
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(c) Notwithstanding anything to the contrary set forth above, the Parent Guarantor may designate any Person as a successor parent guarantor (the “Successor Parent Guarantor”); provided that the Parent Guarantor could have merged or amalgamated into such Person in accordance with the provisions hereof, at the time of, and immediately after giving effect to such designation; provided, further, that such Successor Parent Guarantor expressly assumes, by a supplemental indenture in form satisfactory to the Trustee, the Parent Guarantor’s obligations under the Notes and this Indenture. |
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(d) The Surviving Entity or Successor Parent Guarantor, as applicable, shall succeed to, and be substituted for, and may exercise every right and power of, the Parent Guarantor under this Indenture, but, in the case of a lease of all or substantially all of the Parent Guarantor’s assets or in the case of the designation of a Successor Parent Guarantor in accordance with Section 5.01(c), the Parent Guarantor shall not be released from the obligation to pay the principal of, premium, if any, and interest, on the Notes. |
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(e) Nothing in this Indenture shall prevent (i) any Restricted Subsidiary from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor or any other Restricted Subsidiary, (ii) any Subsidiary Guarantor from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Parent Guarantor, either Issuer or another Subsidiary Guarantor (and upon any such transfer, the Guarantee of the transferring Subsidiary Guarantor shall automatically be released) or (iii) the Parent Guarantor from appointing any Person as Successor Parent Guarantor; provided that such appointment is made in accordance with Section 5.01(c) above. |
The Parent Guarantor shall publish a notice of any consolidation, merger or sale of assets described in Section 5.01(a) in accordance with Section 12.02 and, so long as the rules of Euronext Dublin so require, notify such exchange of any such consolidation, merger or sale.
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(a) “Event of Default”, wherever used herein, means any of the following events: |
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(i) a default for 30 days in the payment when due of any interest or any Additional Amounts on any Note; or |
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(ii) default in the payment of the principal of or premium, if any, on any Note at its Maturity (upon acceleration, optional or mandatory redemption, if any, required repurchase or otherwise), whether or not prohibited by the subordination provisions of this Indenture or the Intercreditor Agreement (and/or any Additional Intercreditor Agreement); or |
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(iii) failure to comply with the provisions of Article Five; or |
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(iv) failure to comply with any covenant or agreement of the Parent Guarantor or of any Restricted Subsidiary that is contained herein or any Guarantees (other than specified in sub-clause (i), (ii) or (iii) of this Section 6.01(a)) and such failure continues for a period of 60 days or more, in each case after the written notice specified in Section 6.02(a); or |
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(v) default under the terms of any instrument evidencing or securing the Debt of the Parent Guarantor or any Restricted Subsidiary having an outstanding principal amount in excess of the greater of (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets, in each case, individually or in the aggregate, if that default: (x) results in the acceleration of the payment of such Debt or (y) is caused by the failure to pay such Debt at final maturity thereof after giving effect to the expiration of any applicable grace periods and other than by regularly scheduled required prepayment, and such failure to make any payment has not been waived or the maturity of such Debt has not been extended, and in either case the total amount of such Debt unpaid or accelerated exceeds (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time; or |
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(vi) any Guarantee ceases to be, or shall be asserted in writing by any Guarantor, or any Person acting on behalf of any Guarantor, not to be in full force and effect or enforceable in accordance with its terms (other than as provided for in this Indenture, any Guarantee, the Intercreditor Agreement or any Additional Intercreditor Agreement); or |
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(vii) one or more final judgments, orders or decrees (not subject to appeal and not covered by insurance or indemnities) shall be rendered against the Parent Guarantor or any Material Subsidiary, either individually or in an aggregate amount, in excess of (i) for so long the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) therafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time, and either a creditor shall have commenced an enforcement proceeding upon such judgment, order or decree or there shall have been a period of 60 consecutive days or more during which a stay of enforcement of such judgment, order or decree was not (by reason of pending appeal or otherwise) in effect; or |
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(viii) the entry by a court of competent jurisdiction of (A) a decree or order for relief in respect of the Parent Guarantor or any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or (B) a decree or order adjudging the Parent Guarantor or any Material Subsidiary bankrupt or insolvent, or seeking reorganization, arrangement, adjustment or composition of or in respect of the Parent Guarantor or any Material Subsidiary under any applicable law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Parent Guarantor or any Material Subsidiary or of any substantial part of their respective properties or ordering the winding up or liquidation of their affairs, and any such |
decree, order or appointment pursuant to any Bankruptcy Law for relief shall continue to be in effect, or any such other decree, appointment or order shall be unstayed and in effect, for a period of 100 consecutive days; or |
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(ix) (A) the Parent Guarantor or any Material Subsidiary (x) commences a voluntary case or proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent or (y) consents to the filing of a petition, application, answer or consent seeking reorganization or relief under any applicable Bankruptcy Law, (B) the Parent Guarantor or any Material Subsidiary consents to the entry of a decree or order for relief in respect of the Parent Guarantor or such Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it or, (C) the Parent Guarantor or any Material Subsidiary (x) consents to the appointment of, or taking possession by, a custodian, receiver, liquidator, administrator, supervisor, assignee, trustee, sequestrator or similar official of the Parent Guarantor or such Material Subsidiary or of any substantial part of their respective properties, (y) makes an assignment for the benefit of creditors or (z) admits in writing its inability to pay its debts generally as they become due. |
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(b) If a Default or an Event of Default occurs and is continuing and is known to a responsible officer of the Trustee, the Trustee shall mail to each Holder notice of the Default or Event of Default within 15 Business Days after its occurrence by registered or certified mail or facsimile transmission of an Officer’s Certificate specifying such event, notice or other action, its status and what action the Issuers are taking or proposes to take with respect thereto. Except in the case of a Default or an Event of Default in payment of principal of, premium, if any, and Additional Amounts or interest on any Notes, the Trustee may withhold the notice to the Holders of such Notes if its Trust Officers in good faith determines that withholding the notice is in the interests of the Holders. The Trustee shall not be deemed to have knowledge of a Default unless a Trust Officer has actual knowledge of such Default. The Issuers and the Parent Guarantor shall also notify the Trustee within 15 Business Days of the occurrence of any Default stating what action, if any, they are taking with respect to that Default. |
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(a) If an Event of Default with respect to the Notes (other than an Event of Default specified in clauses (viii) or (ix) of Section 6.01(a)) occurs and is continuing, the Trustee or the Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders) may, and the Trustee, upon the written request of such Holders shall, declare the principal amount of, premium, if any, and any Additional Amounts and accrued interest on all of the outstanding Notes immediately due and payable, and upon any such declaration all such amounts payable in respect of the Notes shall become immediately due and payable. |
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(b) If an Event of Default specified in clauses (viii) or (ix) of Section 6.01(a) occurs and is continuing, then the principal amount of, premium, if any, and Additional Amounts and accrued and unpaid interest on all of the outstanding Notes shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. |
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(c) At any time after a declaration of acceleration under this Indenture, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in aggregate principal amount of the outstanding Notes, by written notice to the Issuers, the Parent Guarantor and the Trustee, may rescind and annul such declaration of acceleration and its consequences if: |
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(i) the Parent Guarantor or either Issuer has paid or deposited with the Trustee a sum sufficient to pay: |
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(A) all overdue interest and Additional Amounts, if any, on all Notes then outstanding; |
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(B) all unpaid principal of and premium, if any, on any outstanding Notes that have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Notes; |
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(C) to the extent that payment of such interest is lawful, interest upon overdue interest and overdue principal at the rate borne by the Notes; and |
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(D) all sums paid or advanced by the Trustee under this Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; |
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(ii) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and |
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(iii) all Events of Default, other than the non-payment of amounts of principal of, premium, if any, and any Additional Amounts and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.04. |
No such rescission shall affect any subsequent default or impair any right consequent thereon.
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(d) In the event of a declaration of acceleration of the Notes because an Event of Default as described in Section 6.01(a)(v) has occurred and is continuing, the declaration of acceleration of the Notes shall be automatically annulled if the event of default or payment default triggering such Event of Default pursuant to Section 6.01(a)(v) shall be remedied or cured, or waived by the holders of the Debt that gave rise to such Event of Default, or such Debt shall have been discharged in full, within 20 days after the Event of Default arose and if (1) the annulment of the acceleration (if applicable) of the Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, except nonpayment of principal, premium or interest, including Additional Amounts, if any, on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived. |
All rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee, without the possession of any of the Notes or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.
in the payment of the principal of, premium, if any, Additional Amounts, if any, or interest on any Note; or
in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the holders of 90% of the outstanding Notes.
Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
the Trustee may refuse to follow any direction that conflicts with law, this Indenture or that the Trustee determines, without obligation, in good faith may be unduly prejudicial to the rights of Holders not joining in the giving of such direction;
the Trustee may refuse to follow any direction that the Trustee determines is unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability; and
the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction.
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SECTION 6.06. Limitation on Suits. A Holder may not institute any proceedings or pursue any remedy with respect to this Indenture or the Notes unless: |
the Holders of at least 30% in aggregate principal amount of outstanding Notes shall have made a written request to the Trustee to pursue such remedy;
such Holder or Holders offer the Trustee indemnity and/or security (including by way of pre-funding) reasonably satisfactory to the Trustee against any costs, liability or expense;
the Trustee does not comply with the request within 30 days after receipt of the request and the offer of indemnity and/or security (including by way of pre-funding); and
during such 30-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes do not give the Trustee a direction that is inconsistent with the request.
The limitations in the foregoing provisions of this Section 6.06, however, do not apply to a suit instituted by a Holder for the enforcement of the payment of the principal of, premium, if any, Additional Amounts, if any, or interest, if any, on such Note on or after the respective due dates expressed in such Note.
A Holder may not use this Indenture to prejudice the rights of any other Holder or to obtain a preference or priority over another Holder.
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SECTION 6.08. Collection Suit by Trustee. The Issuers covenant that if default is made in the payment of: |
any installment of interest on any Note when such interest becomes due and payable and such default continues for a period of 30 days, or
the principal of (or premium, if any, on) any Note at the Maturity thereof,
the Issuers shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Notes, the whole amount then due and payable on such Notes for principal (and premium, if any), Additional Amounts, if any and interest, and interest on any overdue principal (and premium, if any) and Additional Amounts, if any and, to the extent that payment of such interest shall be legally enforceable, upon any overdue installment of interest, at the rate borne by the Notes, and, in addition thereto, such further amount as shall be sufficient to cover the amounts provided for in Section 7.05 and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Issuers fail to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuers or any other obligor upon the Notes and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Issuers or any other obligor upon the Notes, wherever situated.
Nothing herein contained shall be deemed to empower the Trustee to authorize or consent to, or accept or adopt on behalf of any Holder, any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
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SECTION 6.10. Application of Money Collected. If the Trustee collects any money or property pursuant to this Article Six, it shall pay out the money or property in the following order: |
FIRST:to the Trustee and any Agent for amounts due under Section 7.05;
SECOND:to Holders for amounts due and unpaid on the Notes for principal of, premium, if any, interest, if any, and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, interest, if any, and Additional Amounts, if any, respectively; and
THIRD:to the Issuers, any Guarantor or any other obligors of the Notes, as their interests may appear, or as a court of competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 30 days before such record date, the Issuers shall mail to each Holder and the Trustee a notice that states the record date, the payment date and amount to be paid. This Section 6.10 is subject at all times to the provisions set forth in Section 11.02.
any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article Six or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be. |
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(a) If an Event of Default has occurred and is continuing of which a Trust Officer of the Trustee has actual knowledge, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, the Intercreditor Agreement, and any Additional Intercreditor Agreement and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs; |
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(b) Subject to the provisions of Section 7.01(a), (i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, the Intercreditor Agreement, any Additional Intercreditor Agreement and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement. In the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee, shall examine same to determine whether they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); |
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(c) The Trustee shall not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: |
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(i) this clause (d) does not limit the effect of Section 7.01(b); |
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(ii) the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer of the Trustee unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and |
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(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.02 or 6.05; |
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(d) The Trustee and any Paying Agent shall not be liable for interest on any money received by it except as the Trustee and any Paying Agent may agree in writing with the Issuers or the Subsidiary Guarantors. Money held in trust by the Trustee or the Principal Paying Agent need not be segregated from other funds except to the extent required by law and, for the avoidance of doubt, shall not be held in accordance with the UK Client Money Rules; |
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(e) No provision of this Indenture, the Intercreditor Agreement, or any Additional Intercreditor Agreement shall require the Trustee, each Agent, or the Principal Paying Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not assured to it; and |
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(f) Any provisions hereof or of the Intercreditor Agreement or any Additional Intercreditor Agreement relating to the conduct or affecting the liability of or affording protection to the Trustee or each Agent, as the case may be, shall be subject to the provisions of this Section 7.01. |
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(a) Subject to Section 7.01: |
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(i) following the occurrence of a Default or an Event of Default, the Trustee is entitled to require all Agents to act under its direction; |
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(ii) the Trustee may rely conclusively, and shall be protected in acting or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper person; |
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(iii) before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both, which shall conform to Section 12.04. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion and such certificate or opinion will be equal to complete authorization; |
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(iv) the Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care by it hereunder; |
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(v) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee security and/or indemnity (including by way of pre-funding) satisfactory to the Trustee against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction; |
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(vi) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from either Issuer will be sufficient if signed by an officer of such Issuer; |
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(vii) the Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; |
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(viii) whenever, in the administration of this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement, the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate; |
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(ix) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, individually, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuers personally or by agent or attorney; |
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(x) the Trustee shall not be required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture; |
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(xi) in the event the Trustee receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal amount of the Notes then outstanding, pursuant to the provisions of this Indenture, the Trustee, in its discretion, may determine what action, if any, will be taken; |
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(xii) the permissive rights of the Trustee to take the actions permitted by this Indenture will not be construed as an obligation or duty to do so; |
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(xiii) delivery of reports, information and documents to the Trustee under Section 4.19 is for informational purposes only and the Trustee’s receipt of the foregoing will not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Parent Guarantor’s or any of its Restricted Subsidiary’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates); |
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(xiv) the rights, privileges, protections, immunities and benefits given to the Trustee in this Indenture, including, without limitation, its rights to be indemnified and compensated, are extended to, and will be enforceable by, the Trustee in its capacities hereunder, by the Registrar, the Agents, and each agent, custodian and other Person employed to act hereunder; |
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(xv) the Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel will, subject to Section 7.01(c), be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; |
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(xvi) the Trustee shall have no duty to inquire as to the performance of the covenants of the Parent Guarantor and/or its Restricted Subsidiaries in Article Four hereof; |
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(xvii) the Trustee shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Indenture or under applicable law or regulation with respect to any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Notes, but may at its sole discretion, choose to do so; |
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(xviii) in no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of, or caused by, directly or indirectly, forces beyond its control, including, without limitation, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances; and |
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(xix) the Trustee shall not under any circumstance be liable for any consequential loss or punitive damages (including loss of business, goodwill, opportunity or profit of any kind) of the Issuers, any Guarantor or any Restricted Subsidiary. |
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(b) The Trustee may request that the Issuers deliver an Officer’s Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. |
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(c) The Trustee is not required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture or the Notes. |
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(d) The Trustee will not be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control. |
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(e) Notwithstanding anything else herein contained, the Trustee and Agents may refrain without liability from doing anything that would or might in its opinion be contrary to any law of any state or jurisdiction (including but not limited to include the European Union and the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may without liability do anything which is, in its opinion, necessary to comply with any such law, directive or regulation. |
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(f) The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York. |
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(g) The Trustee may assume without inquiry in the absence of actual knowledge that the Issuers are duly complying with their obligations contained in this Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Notes has occurred. |
The Issuers, failing which the Guarantors, shall indemnify the Trustee against any and all loss, liability or expense (including attorneys’ fees and expenses) incurred by it without willful misconduct or negligence on its part arising out of or in connection with the administration of this trust and the performance of its duties hereunder (including the costs and expenses of enforcing this Indenture, the Intercreditor Agreement and any Additional Intercreditor Agreement against the Issuers and the Guarantors (including this Section 7.05) and defending itself against any claim, whether asserted by the Issuers, the Guarantors, any Holder or any other Person, or liability in connection with the execution and performance of any of their powers and duties hereunder). The Trustee shall notify the Issuers promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Issuers shall not relieve the Issuers or any Guarantor of its obligations hereunder. The Issuers shall, at the sole discretion of the Trustee, as applicable, defend the claim and the Trustee may cooperate and may participate at the Issuers’ expense in such defense. Alternatively, the Trustee may at its option have separate counsel of its own choosing and the Issuers shall pay the properly incurred fees and expenses of such counsel. The Issuers need not pay for any settlement made without its consent, which consent may not be unreasonably withheld. The Issuers shall not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
To secure the Issuers’ payment obligations in this Section 7.05, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, in its capacity as Trustee, except money or property held in trust to pay principal of, premium, if any, additional amounts, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of all Notes under this Indenture.
When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.01(a)(viii) or (ix) with respect to the Issuers, the Guarantors, or any Restricted Subsidiary, the expenses are intended to constitute expenses of administration under Bankruptcy Law.
The Issuers’ obligations under this Section 7.05 and any claim or Lien arising hereunder shall survive the resignation or removal of any Trustee, the satisfaction and discharge of the Issuers’ obligations pursuant to Article Eight and any rejection or termination under any Bankruptcy Law, and the termination of this Indenture.
The Trustee may resign at any time without giving any reason by so notifying the Issuers. The Holders of a majority in outstanding principal amount of the outstanding Notes may remove the Trustee by so notifying the Trustee and the Issuers. The Issuers shall remove the Trustee if:
the Trustee fails to comply with Section 7.09;
the Trustee is adjudged bankrupt or insolvent;
a receiver or other public officer takes charge of the Trustee or its property; or
the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed, or if a vacancy exists in the office of Trustee for any reason, the Issuers shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Issuers. If the successor Trustee does not deliver its written acceptance required by the next succeeding paragraph of this Section 7.06 within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the Holders of a majority in principal amount of the outstanding Notes may, at the expense of the Issuers, petition any court of competent jurisdiction for the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Issuers. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee; provided that all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.05.
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the Holders of at least 30% in outstanding principal amount of the Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee at the expense of the Issuers. Without prejudice to the right of the Issuers to appoint a successor Trustee in accordance with the provisions of this Indenture, the retiring Trustee may appoint a successor Trustee at any time prior to the date on which a successor Trustee takes office.
If the Trustee fails to comply with Section 7.09, any Holder who has been a bona fide Holder of a Note for at least six months may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section 7.06, the Issuers’ and the Guarantors’ obligations under Section 7.05 shall continue for the benefit of the retiring Trustee.
such Notes. In case at that time any of the Notes shall not have been authenticated, any successor Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and effect which this Indenture provides for the certificate of authentication of the Trustee shall have; provided that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Notes in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. |
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(a) It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture, and in particular in case of the enforcement thereof on Default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Trustee or hold title to the properties, in trust, as herein granted or take any action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an individual or institution as a separate or co-trustee. |
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(b) In the event that the Trustee appoints an additional individual or institution as a separate or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and Lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co-trustee but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and only to the extent that the Trustee by the laws of any jurisdiction is incapable of exercising such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of them. |
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(c) Should any instrument in writing from the Issuers be required by the separate or co-trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to him or it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall to the extent permitted by the laws of the State of New York and the jurisdictions of organization of the Issuers, on request, be executed, acknowledged and delivered by the Issuers; provided that if an Event of Default shall have occurred and be continuing, if the Issuers do not execute any such instrument within 15 days after request therefor, the Trustee shall be empowered as an attorney-in-fact for the Issuers to execute any such instrument in the Issuers’ name and stead. In case any separate or co-trustee or a successor to either shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate or co-trustee. |
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(d) Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: |
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(i) all rights and powers, conferred or imposed upon the Trustee shall be conferred or imposed upon and may be exercised or performed by such separate trustee or co-trustee; and |
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(ii) no trustee hereunder shall be liable by reason of any act or omission of any other trustee hereunder. |
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(e) Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article Seven. |
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(f) Any separate trustee or co-trustee may at any time appoint the Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successors trustee. |
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(a) Any Agent may resign its appointment hereunder at any time without the need to give any reason and without being responsible for any costs associated therewith by giving to the Issuers and the Trustee and (except in the case of resignation of the Principal Paying Agent) the Principal Paying Agent 30 days’ written notice to that effect (waivable by the Issuers and the Trustee); provided that in the case of resignation of the Principal Paying Agent no such resignation shall take effect until a new Principal Paying Agent (approved in advance in writing by the Trustee) shall have been appointed by the Issuers to exercise the powers and undertake the duties hereby conferred and imposed upon the Principal Paying Agent. Following receipt of a notice of resignation from any Agent, the Issuers shall promptly give notice thereof to the Holders in accordance with Section 12.02. Such notice shall expire at least 30 days before or after any due date for payment in respect of the Notes. |
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(b) If any Agent gives notice of its resignation in accordance with this Section 7.11 and a replacement Agent is required and by the tenth day before the expiration of such notice such replacement has not been duly appointed, such Agent may itself appoint as its replacement any reputable and experienced financial institution. Immediately following such appointment, the Issuers shall give notice of such appointment to the Trustee, the remaining Agents and the Holders whereupon the Issuers, the Trustee, the remaining Agents and the replacement Agent shall acquire and become subject to the same rights and obligations between themselves as if they had entered into an agreement in the form mutatis mutandis of this Indenture. |
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(c) Upon its resignation becoming effective the Principal Paying Agent shall forthwith transfer all moneys held by it hereunder hereof to the successor Principal Paying Agent or, if none, the Trustee or to the Trustee’s order, but shall have no other duties or responsibilities hereunder, and shall be entitled to the payment by the Issuers of its remuneration for the services previously rendered hereunder and to the reimbursement of all reasonable expenses (including legal fees) incurred in connection therewith. |
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(a) Actions of Agents. The rights, powers, duties and obligations and actions of each Agent under this Indenture are several and not joint or joint and several. |
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(b) Agents of Trustee. The Issuers and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuers and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee. Prior to receiving such written notification from the Trustee, the Agents shall be the agents of the Issuers and need have no concern for the interests of the Holders. |
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(c) Funds held by Agents. The Agents will hold all funds as banker subject to the terms of this Indenture and as a result, such money will not be held in accordance with the rules established by the Financial Conduct Authority in the Financial Conduct Authority’s Handbook of rules and guidance from time to time in relation to client money. |
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(d) Publication of Notices. Any obligation the Agents may have to publish a notice to Holders of Global Notes on behalf of the Issuers will be met upon delivery of the notice to DTC. |
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(e) Instructions. In the event that instructions given to any Agent are not reasonably clear, then such Agent shall be entitled to seek clarification from the Issuers or other party entitled to give the Agents instructions under this Indenture by written request promptly, and in any event within one Business Day of receipt by such Agent of such instructions. If an Agent has sought clarification in accordance with this Section 7.12, then such Agent shall be entitled to take no action until such clarification is provided, and shall not incur any liability for not taking any action pending receipt of such clarification. |
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(f) No Fiduciary Duty. No Agent shall be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust, for or with any person other than the Issuers. |
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(g) Mutual Undertaking. Each Party shall, within ten Business Days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this Section 7.12(g) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality. For purposes of this Section 7.12(g), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature. |
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(h) Tax Withholding. |
The Issuers shall notify each Agent in the event that they determine that any payment to be made by an Agent under the Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated; provided, however, that the Issuers’ obligations under this Section 7.12(h) shall apply only to the extent that such payments are so treated by virtue of characteristics of either Issuer, the Notes, or both.
Notwithstanding any other provision of this Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Tax,
if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuers the amount so deducted or withheld, in which case, the Issuers shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.12(h)(ii).
If the Issuers exercise their legal defeasance option, each Guarantor, if any, shall be released from all its obligations under its Guarantee, and the Trustee shall execute a release of such Guarantee.
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SECTION 8.04. Conditions to Defeasance. In order to exercise either legal defeasance or covenant defeasance: |
the Issuers or the Parent Guarantor must irrevocably deposit or cause to be deposited as trust funds in trust with the Trustee (or such other party as directed by the Trustee), for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of an internationally recognized law firm of independent public accountants, to pay and discharge the principal of, premium, if any, and accrued and unpaid interest and any Additional Amounts, if any, on the outstanding Notes on the Stated Maturity or on the applicable Redemption Date, as the case may be, and the Issuers or the Parent Guarantor must (i) specify whether the Notes are being defeased to maturity or to a particular Redemption Date; and (ii) if applicable, have delivered to the Trustee an irrevocable notice to redeem all of the outstanding Notes of such principal, premium, if any, or interest;
in the case of an election under Section 8.02, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee stating that (A) the U.S. Internal Revenue Service has either published a revenue ruling or issued to the Issuers a private letter ruling, or (B) since the Issue Date, there has been a change in applicable U.S. federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such legal defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred;
in the case of an election under Section 8.03, the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee to the effect that the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred;
no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) or, insofar as bankruptcy or insolvency events described in Section 6.01(a)(viii) or (ix) are concerned, at any time during the period ending on the 123rd day after the date of such deposit;
such legal defeasance or covenant defeasance shall not cause the Trustee to have a conflicting interest as defined in this Indenture with respect to any of the Issuers’ securities;
such legal defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) under, this Indenture or any material agreement or instrument to which the Parent Guarantor or any Restricted Subsidiary is a party or by which the Parent Guarantor or any Restricted Subsidiary is bound;
such legal defeasance or covenant defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the U.S. Investment Company Act of 1940, as amended, unless such trust shall be registered under such Act or exempt from registration thereunder;
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Opinion of Counsel in the country of each Issuer’s or the Parent Guarantor’s incorporation to the effect that after the 123rd day following the deposit, the trust funds shall not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and an Opinion of Counsel reasonably acceptable to the Trustee that the Trustee shall have a perfected security interest in such trust funds for the ratable benefit of the Holders;
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Officer’s Certificate stating that the deposit was not made by the Issuers or the Parent Guarantor with the intent of preferring the Holders over the other creditors of the Issuers or the Parent Guarantor with the intent of defeating, hindering, delaying or defrauding creditors of the Issuers or the Parent Guarantor or others, or removing assets beyond the reach of the relevant creditors or increasing debts of the Issuers or the Parent Guarantor to the detriment of the relevant creditors;
no event or condition shall exist that would prevent the Issuers from making payments of the principal of, premium, if any, and interest on the Notes on the date of such deposit or at any time ending on the 123rd day after the date of such deposit; and
the Issuers or the Parent Guarantor shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the legal defeasance or the covenant defeasance, as the case may be, have been complied with.
If the funds deposited with the Trustee to effect covenant defeasance are insufficient to pay the principal of, premium, if any, and interest on the Notes when due because of any acceleration occurring after an Event of Default, then the Issuers and the Guarantors shall remain liable for such payments.
the Issuers or the Parent Guarantor has irrevocably deposited or caused to be deposited with the Trustee (or such other party as directed by the Trustee) as funds in trust for such purpose an amount in cash in U.S. dollars, U.S. Government Securities or a combination thereof sufficient to pay and discharge the entire Debt on such Notes not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and accrued and unpaid interest, Additional Amounts, if any, to the date of such deposit (in the case of Notes which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be and the Issuers or the Parent Guarantor shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of such Notes at Maturity or on the Redemption Date, as the case may be, and either:
all Notes previously authenticated and delivered (other than lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuers and thereafter repaid to the Issuers or discharged from such trust, as provided in Section 8.07) have been delivered to the Trustee for cancellation; or
all Notes not theretofore delivered to the Trustee for cancellation (A) have become due and payable (by reason of the mailing of a notice of redemption or otherwise) or (B) will become due and payable at Stated Maturity within one year or (C) 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 Issuers’ name, and at the Issuers’ expense;
the Issuers or the Parent Guarantor has paid or caused to be paid all other amounts payable by the Issuers under this Indenture; and
the Issuers or the Parent Guarantor has delivered an Officer’s Certificate and an Opinion of Counsel to the Trustee each stating that: (x) all conditions precedent to satisfaction and discharge have been satisfied, and (y) such satisfaction and discharge will not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument governed by the laws of the State of New York to which either Issuer or any Subsidiary is a party or by which either Issuer or any Subsidiary is bound.
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(a) The Issuers, each when authorized by a resolution of its respective Board of Directors (as evidenced by the delivery of such resolutions to the Trustee), the Guarantors and the Trustee may modify, amend or supplement this Indenture, any Guarantee or the Notes and the Issuers, each when authorized by a resolution of its Board of Directors, the Guarantors, in each case without notice to or consent of any Holder: |
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(i) to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants herein and in the Notes; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of Article Five shall apply mutatis mutandis); |
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(ii) to add to the covenants of the Issuers, any Guarantor or any other obligor upon the Notes for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon the Notes, as applicable, herein, in the Notes or in any Guarantees; |
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(iii) to cure any ambiguity, or to correct or supplement any provision herein, in the Notes or any Guarantees that may be defective or inconsistent with any other provision herein or in the Notes or any Guarantee or to make any other provisions with respect to matters or questions arising under this Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect; |
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(iv) to conform the text of this Indenture, the Guarantees or the Notes to any provision of the “Description of the Senior Notes” in the Offering Memorandum to the extent that such provision in such “Description of the Senior Notes” was intended to be a verbatim recitation of a provision of this Indenture, the Guarantees or the Notes; |
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(v) to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in this Indenture and to add a Subsidiary Guarantor or other guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s)); |
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(vi) to evidence and provide the acceptance of the appointment of a successor Trustee hereunder; |
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(vii) to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuers’ and any Guarantor’s obligations hereunder, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to this Indenture or otherwise ; or |
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(viii) to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in this Indenture. |
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(b) The Issuers, each when authorized by a resolution of its respective Board of Directors (as evidenced by the delivery of such resolutions to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under this Indenture may supplement this Indenture to add a Subsidiary Guarantor or other Guarantor under this Indenture (which shall require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other Guarantor(s)) in each case without notice to or consent of any Holder. |
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(c) In formulating its opinion on such matters, the Trustee shall be entitled to require and rely conclusively on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate. |
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(a) Except as provided in Section 9.02(b) and Section 6.04 and without prejudice to Section 9.01, the Issuers, the Guarantors and the Trustee may: |
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(i) modify, amend or supplement this Indenture or the Notes; or |
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(ii) waive compliance by the Issuers with any provision of this Indenture or the Notes, |
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes) provided that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
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(b) Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 and an amendment, modification or supplement pursuant to Section 9.01, may: |
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(i) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note; |
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(ii) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note; |
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(iii) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable; |
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(iv) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date); |
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(v) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver of certain provisions of this Indenture; |
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(vi) modify any of the provisions of this Article Nine or any provisions herein relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby; |
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(vii) make any change to the Intercreditor Agreement (and/or any Additional Intercreditor Agreement) or any provisions of this Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders; or |
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(viii) make any change in Section 4.12 that adversely affects the rights of any Holder or amend the terms of the Notes or this Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture. |
(c)The consent of the Holders will not be necessary under this Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under this Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
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(b) The aggregate principal amount of the Notes, at any date of determination, shall be the principal amount of the Notes at such date of determination. With respect to any matter requiring consent, waiver, approval or other action of the Holders of a specified percentage of the principal amount of all the Notes, such percentage shall be calculated, on the relevant date of determination, by dividing (i) the principal amount, as of such date of determination, of Notes, the Holders of which have so consented by (b) the aggregate principal amount, as of such date of determination, of the Notes then outstanding, in each case, as determined in accordance with the preceding sentence, Section 2.08 and Section 2.09 of this Indenture. Any such calculation made pursuant to this Section 9.08(b) shall be made by the Issuers and delivered to the Trustee pursuant to an Officer’s Certificate. |
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(a) (i) The Parent Guarantor hereby fully and, subject to the limitations on the effectiveness and enforceability set forth in Section 10.04, unconditionally guarantees, on a senior unsecured, joint and several basis, and (ii) each Subsidiary Guarantor by execution of a supplemental indenture hereto, fully and, subject to the limitations on the effectiveness and enforceability set forth in such supplemental indenture, unconditionally guarantees, on a senior subordinated, unsecured, joint and several basis, in each |
case to each Holder and to the Trustee and its successors and assigns on behalf of each Holder, the full payment of principal of, premium, if any, interest, if any, and Additional Amounts, if any on, and all other monetary obligations of the Issuers under this Indenture and the Notes (including obligations to the Trustee and the obligations to pay Additional Amounts, if any) with respect to each Note authenticated and delivered by the Trustee or its agent pursuant to and in accordance with this Indenture, in accordance with the terms of this Indenture (all the foregoing being hereinafter collectively called the “Obligations”). The Guarantors further agree that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from the Guarantors and that the Guarantors shall remain bound under this Article Ten notwithstanding any extension or renewal of any Obligation. All payments under each Guarantee will be made in U.S. dollars. |
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(c) The Guarantors also agree to pay any and all costs and expenses (including reasonable attorneys’ fees) incurred by the Trustee or any Holder in enforcing any rights under this Section 10.01. |
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(d) Each Subsidiary Guarantor agrees and each Holder by accepting a Note agrees, for the benefit of the holders of Senior Debt from time to time of such Subsidiary Guarantor, that prior to the date upon which any Senior Debt of a Subsidiary Guarantor has been unconditionally discharged in full, the obligations of such Subsidiary Guarantor under its Guarantee may not become due, and neither the Holders nor the Trustee may take any Enforcement Action against such Subsidiary Guarantor without the prior consent of the applicable Senior Agent or Senior Agents unless: |
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(i) an Event of Default specified in Section 6.01(a)(viii) or (ix) has occurred in relation to such Subsidiary Guarantor; or |
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(ii) the holders of Designated Senior Debt have taken any Enforcement Action in relation to such Subsidiary Guarantor; or |
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(iii) a Default has occurred under the Notes; and |
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(A) the Holders or the Trustee has notified the applicable Senior Agents; and |
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(B) a period of not less than 90 days (in the case of a default specified under Sections 6.01(a)(i) or (ii) or 179 days (in the case of a non-payment default specified under Sections 6.01(a)(iii), (iv), (v), (vi) or (vii)) has passed from the date the applicable Senior Agents were first notified of the Default (a “Standstill Period”); and |
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(C) at the end of the Standstill Period, the Default is continuing and has not been waived by the Holders. |
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(e) Each Guarantee of a Guarantor hereunder is on parity with such Guarantor’s guarantee of the Existing Unsecured Notes. |
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(a) Each Guarantor shall be subrogated to all rights of the Holders against the Issuers in respect of any amounts paid to such Holders by such Guarantor pursuant to the provisions of its Guarantee. |
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(b) The Guarantors agree that they shall not be entitled to any right of subrogation in relation to the Holders in respect of any Obligations guaranteed hereby until payment in full of all Obligations. The Guarantors further agree that, as between them, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the Obligations guaranteed hereby may be accelerated as provided in Section 6.02 for the purposes of the Guarantees herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such Obligations as provided in Section 6.02, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purposes of this Section 10.02 subject to Article Eleven. |
upon any sale or disposition of (i) Capital Stock of a Subsidiary Guarantor following which such Subsidiary Guarantor is no longer a Restricted Subsidiary or, (ii) all or substantially all of the properties and assets of a Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary that does not violate Section 4.09;
in the event that all of the Capital Stock of such Subsidiary Guarantor is sold or otherwise disposed of pursuant to an enforcement of the security over the Capital Stock of such Subsidiary Guarantor in accordance with the terms of the Intercreditor Agreement and any Additional Intercreditor Agreement;
upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary;
upon legal defeasance under Section 8.02, covenant defeasance under Section 8.03 or upon satisfaction and discharge under Section 8.05;
in the circumstances set forth in Section 5.01(d); and
as described in Article Nine.
Each Subsidiary Guarantor agrees and each Holder by accepting a Note agrees, that the provisions of Section 10.03(b) are for the benefit of and enforceable by the Holders of Senior Debt of such Subsidiary Guarantor.
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(a) Each Guarantee is limited to (i) an amount not to exceed the maximum amount that can be guaranteed by the Guarantor that gave such Guarantee without rendering such Guarantee, as it relates to such Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally or (ii) the maximum amount otherwise permitted by law. |
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(b) Ireland. The Guarantee by a Guarantor organized under the laws of Ireland shall not be lawful if it constitutes financial assistance to any person for the purpose of an acquisition by subscription, purchase, exchange or otherwise of any shares in such Guarantor or a holding company of such Guarantor contrary to Section 82 of the Companies Act 2014. |
such Subsidiary Guarantor and that such subordination is for the benefit of and enforceable by the holders of Senior Debt of such Subsidiary Guarantor. Each Subsidiary Guarantee shall in all respects rank senior in right of payment to any future Subordinated Debt of the Subsidiary Guarantor that made such Subsidiary Guarantee. |
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(a) The holders of Senior Debt of each Subsidiary Guarantor will be entitled to receive payment in full in cash of all obligations in respect of such Senior Debt (including interest after the commencement of any proceedings in respect thereof at the rate specified therein whether or not such interest is an allowed claim enforceable against such Subsidiary Guarantor under applicable bankruptcy law) before the Holders of Notes will be entitled to receive any payment from such Subsidiary Guarantor (including, without limitation, as a result of redemption, purchase or other acquisition) with respect to its Subsidiary Guarantee (except that Holders of Notes may receive and retain Permitted Junior Securities and payments made from the trust (if any) described in Section 8.04), in the event of any payment, distribution, division or application, partial or complete, voluntary or involuntary, by operation of law or otherwise, of all or any part of the assets of any kind or character or the proceeds thereof to creditors of such Subsidiary Guarantor in any: |
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(i) liquidation or dissolution of such Subsidiary Guarantor; |
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(ii) insolvency, bankruptcy, reorganization, composition, receivership, administration, voluntary arrangement or similar proceeding relating to such Subsidiary Guarantor or its property; |
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(iii) assignment for the benefit of the creditors of such Subsidiary Guarantor; or |
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(iv) marshaling of such Subsidiary Guarantor’s assets and liabilities. |
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(b) Notwithstanding the foregoing, any payment or distribution of any kind or character (other than Permitted Junior Securities and payments made from trust (if any) described in Section 8.04) and all and any rights in respect thereof, whether in cash, securities or other property which is payable or deliverable upon or with respect to the Subsidiary Guarantee owed by a Subsidiary Guarantor, or any part thereof, by a liquidator, administrator or receiver (or the equivalent thereof) of such Subsidiary Guarantor (“rights”) made to or paid to, or received by the Trustee, or to which the Trustee is entitled, before all amounts with respect to the Senior Debt of such Subsidiary Guarantor are paid in full and, with respect to a payment or distribution to the Trustee, which the Trustee or such Holder has actual knowledge that such payment or distribution was so prohibited prior to distributing that payment in accordance with the terms of this Indenture, shall be held in trust by the Trustee, for the holders of Senior Debt of such Subsidiary Guarantor and shall forthwith be paid or, as the case may be, transferred or assigned to the applicable Senior Agent or any other proper representative of the holders of the relevant Senior Debt. |
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(c) If the trust referred to in clause (b) above fails or cannot be given effect to, or the Trustee (and any agent or trustee on its behalf) receives and retains any such payment or distribution (and has actual knowledge that such payment or distribution was so prohibited) or the Issuer, will pay over such rights in the form received to the Senior Agent or any other proper representative of the holders of the relevant Senior Debt to be applied against the relevant Senior Debt (after taking into account any concurrent payment or distribution being made to the holders of such Senior Debt). |
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(a) a payment default on Designated Senior Debt of such Subsidiary Guarantor has occurred and is continuing beyond any applicable grace period; or |
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(b) any other default occurs and is continuing on any Designated Senior Debt of such Subsidiary Guarantor that permits the holders of that Designated Senior Debt to accelerate its maturity and the Trustee receives a notice of such default (a “Payment Blockage Notice”) from the Issuer or the holders of such Designated Senior Debt. |
Payments on any such Guarantee of a Subsidiary Guarantor shall and will be resumed:
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(i) in the case of a payment default, when such default is cured or waived; or |
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(ii) in the case of a non-payment default, upon the earlier of the date on which such non-payment default is cured or waived and 179 days after the date on which the applicable Payment Blockage Notice is received, unless the maturity of any Designated Senior Debt has been accelerated. |
Neither the Trustee, the Issuers nor any such Subsidiary Guarantor shall be required to give effect to any new Payment Blockage Notice that may be delivered unless and until (A) 360 days have elapsed since the delivery of the immediately prior Payment Blockage Notice and (B) all scheduled payments of principal, premium, if any, and interest on the Notes that have come due have been paid in full in cash. No non-payment default that existed or was continuing on the date of delivery of a Payment Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice.
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SECTION 11.05. Trustee to Effectuate Subordination of Each Subsidiary Guarantee; Intercreditor Agreement. |
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(a) Each Holder by accepting the Notes guaranteed by each Subsidiary Guarantor authorizes and expressly directs the Trustee on such Holder’s behalf to take such action as may be necessary or appropriate to acknowledge or effectuate the subordination of such Subsidiary Guarantor’s Guarantee between the Holders and the holders of Senior Debt of such Subsidiary Guarantor as provided in Section 10.01(d) and this Article Eleven, including by entering into the Intercreditor Agreement or any Additional Intercreditor Agreement or deed in favor of holders of Senior Debt and appoints the Trustee as attorney-in- |
fact for any and all such purposes, and the Trustee shall not be required to take any actions inconsistent with this Indenture. |
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(b) The Issuers, each when authorized by a resolution of its respective board of directors (as evidenced by the delivery of such resolutions to the Trustee), any Subsidiary Guarantor and the Trustee may, without notice to or consent of any Holder, enter into any Additional Intercreditor Agreement to give effect to the ranking and subordination provisions in Section 10.01(d) and this Article Eleven hereof for the benefit of any holders of Designated Senior Debt of any Subsidiary Guarantor. Each Holder, by accepting its Note, shall be deemed to have: |
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(i) appointed and authorized the Trustee to give effect to such ranking and subordination provisions; |
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(ii) authorized the Trustee to become a party to any Additional Intercreditor Agreement; |
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(iii) agreed to be bound by such subordination provisions and the provisions of any Additional Intercreditor Agreement that do not materially adversely affect the rights of Holders; and |
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(iv) irrevocably appointed the Trustee to act on its behalf to enter into and comply with such subordination provisions and the provisions of any Additional Intercreditor Agreements. |
For the avoidance of doubt, the parties hereto agree that in the event of conflict between the provisions of this Article Eleven and the provisions of the Intercreditor Agreement or any Additional Intercreditor Agreement, the Intercreditor Agreement or any Additional Intercreditor Agreement shall prevail.
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(a) Each Holder by accepting a Note acknowledges and agrees that the foregoing subordination provisions in Section 10.01(d) and this Article Eleven are intended to be an inducement and a consideration to any and all holders of existing and future Senior Debt of a Subsidiary Guarantor to acquire and continue to hold, or to continue to hold such Senior Debt and such holders of Senior Debt shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Debt and no amendment or modification of the provisions contained herein shall diminish the rights of any such holder of Senior Debt unless such holder shall have agreed in writing thereto. |
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(b) The Parent Guarantor and each Subsidiary Guarantor agree, for the benefit of each existing and future holder of Senior Debt that, as long as any Existing Ardagh Bonds or any amounts under the |
indentures governing the Existing Ardagh Bonds remain outstanding, no amendment or modification of the provisions of such indentures shall diminish the rights of any such holder of Senior Debt unless such holder shall have agreed in writing thereto. |
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SECTION 11.08. Trustee’s Compensation Not Prejudiced. Nothing in this Article Eleven shall apply to amounts due to the Trustee pursuant to other Sections of this Indenture. |
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(a) Each Subsidiary Guarantor shall give prompt written notice to the Trustee of any fact known to such Subsidiary Guarantor which would prohibit the making of any payment to or by the Trustee in respect of its Subsidiary Guarantee. Notwithstanding the provisions of this Article Eleven or any other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of any facts which would prohibit the making of any payment to or by the Trustee in respect of any Subsidiary Guarantee, unless and until a Trust Officer of the Trustee shall have received written notice thereof from the relevant Subsidiary Guarantor, the representative of the holders of Senior Debt of such Subsidiary Guarantor or from any trustee, fiduciary or agent therefor; and, prior to the receipt of any such written notice, the Trustee shall be entitled in all respects to assume that no such facts exist; provided that, if a Trust Officer of the Trustee shall not have received the notice provided for in this Section at least three Business Days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of (and premium, if any) or interest on any Note), then anything herein contained to the contrary notwithstanding, the Trustee shall have full power |
and authority to receive such money and to apply the same to the purpose for which such money was received and shall not be affected by any notice to the contrary which may be received by it within three Business Days prior to such date. |
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(b) The Trustee shall be entitled to rely on the delivery to it of a written notice by a Person representing himself to be a holder of Senior Debt of a Subsidiary Guarantor (or a trustee, fiduciary or agent therefor) to establish that such notice has been given by a holder of Senior Debt of a Subsidiary Guarantor (or a trustee, fiduciary or agent therefor). In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any Person as a holder of Senior Debt of a Subsidiary Guarantor to participate in any payment or distribution pursuant to this Article Eleven, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Debt of the relevant Subsidiary Guarantor held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article Eleven and, if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. |
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(a) Notwithstanding anything to the contrary in this Indenture, upon the sale or disposition directly or indirectly of the Capital Stock of the U.S. Issuer pursuant to an enforcement by a security agent in accordance with the Intercreditor Agreement (or any Additional Intercreditor Agreement) and this Indenture (a “Holdings USA Disposition”), the obligations of the U.S. Issuer under the Notes and this Indenture will be automatically and unconditionally released (and thereupon shall terminate and be discharged and be of no further effect); provided that each other guarantee by the U.S. Issuer in respect of any Credit Facility and any other capital markets debt of the Parent Guarantor or any of its subsidiaries has been released (or is released simultaneously upon such Holdings USA Disposition). Upon a Holdings USA Disposition, the Irish Issuer shall be the sole Issuer under the Notes and this Indenture, and the Notes and this Indenture shall remain in full force and effect and any reference in this indenture, the Notes and the Intercreditor Agreement (or any Additional Intercreditor Agreement) to the “Issuers” or the U.S. Issuer shall be deemed to be references only to the “Issuer” or the Irish Issuer, mutatis mutandis. |
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(b) The Parent Guarantor shall publish a notice of a Holdings USA Disposition described in Section 12.01(a) in accordance with Section 12.02 and, so long as the rules of Euronext Dublin so require, notify such exchange of a Holdings USA Disposition. |
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(c) The U.S. Issuer agrees, and each Holder by accepting a Note agrees, that the provisions of this Section 12.01 are for the benefit of and enforceable by the security agent referred to therein. |
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(a) Any notice or communication shall be in writing and delivered in person or mailed by first class mail or sent by facsimile transmission addressed as follows: |
if to the Irish Issuer:
Ardagh House
South County Business Park
Leopardstown
Dublin 18
D18 PX68
Ireland
Attention: Finance Director
Facsimile: +353 1 668 3416
if to the U.S. Issuer:
The Corporation Trust Company
1209 Orange Street
Wilmington, Delaware 19801
United States
if to the Guarantors:
Ardagh Group S.A.
56 rue Charles Martel
L 2134 Luxembourg
Grand Duchy of Luxembourg
With copies to:
Shearman & Sterling
9 Appold Street
London, EC2A 2AP
United Kingdom
Telephone: +44 (0)20 7655 5000
Facsimile: +44 (0)20 7655 5500
Attention: Mr. Trevor Ingram
if to the Trustee, Principal Paying Agent or Transfer Agent:
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
(i) for the Trustee:
Fax: +44 20 7500 5877
Attention: The Directors, Agency & Trust
(ii) for the Principal Paying Agent:
Fax: +353 1 622 2210
Attention: PPA desk
(iii) for the Transfer Agent:
Fax: +353 1 622 2031
Attention: Transfer Agent
The Issuers, the Guarantors or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
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(b) Notices regarding the Notes shall be: |
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(i) delivered to Holders electronically or mailed by first-class mail, postage paid, and, if and so long as the Notes are listed on Euronext Dublin and the rules and regulations of such exchange so require, published in a newspaper having a general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) in the case of certificated Notes, mailed to each Holder by first-class mail at such Holder’s respective address as it appears on the registration books of the Registrar. |
Notices given by first-class mail shall be deemed given five calendar days after mailing and notices given by publication shall be deemed given on the first date on which publication is made. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
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(c) If and so long as the Notes are listed on any securities exchange instead of or in addition to Euronext Dublin, notices shall also be given in accordance with any applicable requirements of such alternative or additional securities exchange. |
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(d) If and so long as the Notes are represented by Global Notes, notices may be given by delivery of the relevant notices to DTC for communication to entitled account holders in substitution for the mailing required under Section 12.02(b)(i). |
an Officer’s Certificate in form reasonably satisfactory to the Trustee stating that, in the opinion of the signer, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and
an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.
Any Officer’s Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless the officer signing such certificate knows, or in the exercise of reasonable care should know, that such Opinion of Counsel with respect to the matters upon which such Officer’s Certificate is based are erroneous. Any Opinion of Counsel may be based and may state that it is so based, insofar as it relates to factual matters, upon certificates of public officials or an Officer’s Certificate stating that the information with respect to such factual matters is in the possession of the Issuers, unless the counsel signing such Opinion of Counsel knows, or in the exercise of reasonable care should know, that the Officer’s Certificate with respect to the matters upon which such Opinion of Counsel is based are erroneous.
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SECTION 12.04. Statements Required in Certificate or Opinion. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: |
a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and
a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.
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SECTION 12.07. Governing Law. THIS INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. |
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(a) any Liability may be subject to the exercise of Write-down and Conversion Powers by the Resolution Authority; |
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(b) the Issuers will be bound by the effect of any application of any Write-down and Conversion Powers in relation to any Liability and in particular (but without limitation) by: |
(1)any reduction in the principal amount, in full or in part, or outstanding amount due (including any accrued but unpaid interest) in respect of any Liability; and
(2)any conversion of all or part of any Liability into ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person; that may result from any exercise of any Write-down and Conversion Powers in relation to any Liability;
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(c) the terms of this Indenture and the rights of the Issuers hereunder may be varied, to the extent necessary, to give effect to any exercise of any Write-down and Conversion Powers in relation to any Liability and the Issuers will be bound by any such variation; |
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(d) ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person may be issued to or conferred on an Issuer as a result of any exercise of any Write-down and Conversion Powers in relation to any Liability. |
For purposes of this Section 12.15:
“Liability” means any liability of Citigroup Global Markets Europe AG to the Issuers arising under or in connection with this Indenture;
“Resolution Authority” means the German Federal Agency for Financial Markets Stabilisation (Bundesanstalt für Finanzmarktstabilisierung), or any other body which has authority to exercise any Write-down and Conversion Powers; and
“Write-down and Conversion Powers” means any write-down, conversion, transfer, modification or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in Germany, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time, including but not limited to the German Recovery and Resolution Act (Sanerungs-und Abwicklungsgesetz) as amended from time to time, and the instruments, rules and standards created thereunder, pursuant to which:
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(a) any obligation of Citigroup Global Markets Europe AG (or other affiliate of such entity) can be reduced, cancelled, modified or converted into shares, other securities or other obligations of such entity or any other person (or suspended for a temporary period); and |
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(a) any right in a contract governing an obligation of Citigroup Global Markets Europe AG may be deemed to have been exercised. |
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
ARDAGH PACKAGING FINANCE PLC,
as Issuer
By:
Name:
Title:
ARDAGH HOLDINGS USA INC.
as Issuer
By:
Name:
Title:
ARDAGH GROUP S.A.,
as Parent Guarantor
By:
Name:
Title:
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Principal Paying Agent and Transfer Agent
By:
Name:
Title:
CITIGROUP GLOBAL MARKETS
EUROPE AG,
as Registrar
By:
Name:
Title:
By:
Name:
Title:
Schedule I
AGREED SECURITY PRINCIPLES
1.agreed security principles
The guarantees to be provided under and in connection with this Indenture will be given in accordance with the guarantee principles set out in this Schedule I (the “Agreed Security Principles”). Notwithstanding anything contained in the Agreed Security Principles, so long as the Existing Ardagh Bonds remain outstanding, the guarantees provided in respect of the Notes shall be the same as those provided in respect of the Existing Ardagh Bonds.
2.GENERAL PRINCIPLES
2.1The Agreed Security Principles embody a recognition by all parties that there may be certain legal and practical difficulties in obtaining effective guarantees from the Parent Guarantor and its Subsidiaries (collectively, the “Group”) in certain jurisdictions. In particular:
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(a) |
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mandatory law provisions, general legal, statutory and constitutional documents’ limitations, capital maintenance, the prohibition of an intervention threatening the existence of a German member of the Group (Verstoß gegen das Verbot des existenzvernichtenden Eingriffs), financial assistance, corporate benefit, fraudulent preference, “thin capitalization” rules, “transfer pricing”, retention of title claims, exchange control restrictions, employee consultation or approval requirements, regulatory restrictions and similar principles may limit the ability of a member of the Group to provide a guarantee or may require that the guarantee be limited by an amount or otherwise. If any such limit applies, the guarantees provided will be limited to the maximum amount which the relevant member of the Group may provide having regard to applicable law; |
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(a) |
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unless each consent required by law, statute, the terms of any applicable contract, instrument or constitutional document or otherwise from the minority shareholders in, or any relevant corporate body of, any member of the Group which is not wholly owned (directly or indirectly) by another member of the Group is obtained, such Group member shall not be required to grant guarantees provided that the relevant company and the Parent Guarantor have used reasonable efforts to obtain such consent; |
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(a) |
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guarantees should not be granted to the extent that it would result in a risk to the directors or officers of the relevant grantor of such guarantee of contravention of any statutory duty in such capacity or their fiduciary duties and/or which could reasonably be expected to result in personal, civil or criminal liability on the part of any such director or officer; |
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(a) |
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the maximum guaranteed amount may be limited to minimize stamp duty, notarization, registration or other applicable fees, taxes and duties where the benefit of increasing the guaranteed amount is disproportionate to the level of such fee, taxes and duties; and |
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(a) |
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the giving of a guarantee will not be required if: |
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(i) |
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it would have a material adverse effect on the ability of the relevant member of the Group to conduct its operations and business in the ordinary course as otherwise permitted by the Indenture; or |
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(ii) |
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it would have a material adverse effect on the tax arrangements of the Group or any member of the Group, |
provided that, in each case, the relevant member of the Group shall use reasonable efforts to overcome such obstacle. The guaranteed obligations will be limited where necessary to prevent any material additional tax liability of any member of the Group.
3.guarantees
3.1In the case of guarantees to be granted by a Guarantor incorporated in The Netherlands or France, if the relevant Guarantor has at least 50 employees, and/or over any Dutch or French Assets, if the relevant entity granting such pledge has at least 50 employees, or any other jurisdictions or assets requiring receipt of advice from a works council, such guarantees shall not be granted until neutral or positive advice is received from any relevant works council and such work council shall be allowed to assist to the relevant board meeting of such Guarantor or relevant entity granting such pledge.
3.2In the case of guarantees to be granted by a Guarantor incorporated in The Netherlands or France or any other jurisdictions requiring receipt of advice from a works council such guarantees shall not be granted until neutral or positive advice is received from any relevant works council.
3.3Each guarantee will be an upstream, cross-stream and downstream guarantee and each guarantee will be for all liabilities of the relevant members of the Group under the Indenture in accordance with, and subject to, the requirements of the Agreed Security Principles in each relevant jurisdiction.
3.4No subsidiary of the Parent Guarantor that is a Controlled Foreign Corporation (as defined in the United States Internal Revenue Code of 1986, as amended) (or that is a disregarded entity for U.S. federal income tax purposes owned by any such Controlled Foreign Corporation) shall be required to give a guarantee. These principles also apply with respect to any entity that becomes a United States Person and/or a Controlled Foreign Corporation following any guarantee.
3.5No Subsidiary of the Parent Guarantor shall guarantee the New Secured Notes unless such Subsidiary provides a Guarantee.
4.Jurisdictions
4.1The guarantees to be provided under and in connection with the Notes and the Indenture will only be granted by members of the Group organized under the laws of the following jurisdictions:
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(i) Australia; |
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(i) Austria; |
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(i) Denmark; |
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(i) France; |
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(i) Germany; |
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(i) Guernsey; |
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(i) Ireland; |
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(i) Italy; |
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(i) New Zealand; |
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(i) Norway; |
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(i) Poland; |
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(i) Sweden; |
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(i) Switzerland; |
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(i) The Netherlands; |
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(i) The United Kingdom; and |
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(i) The United States of America. |
Exhibit A
[FORM OF FACE OF NOTE]
ARDAGH PACKAGING FINANCE PLC
ARDAGH HOLDINGS USA INC.
If Regulation S Global Note – CUSIP Number [●]/ISIN [●]
If Restricted Global Note – CUSIP Number [●]/ISIN [●]
No. [ ]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE AND IS REGISTERED IN THE NAME OF DTC OR A NOMINEE OF DTC OR A SUCCESSOR DEPOSITARY. THIS NOTE IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]
THIS SECURITY HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON U.S. PERSON ACQUIRING THIS NOTE IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED SECURITIES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE SECURITIES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO AN ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO EACH ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN $200,000.
BY ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN), THE PURCHASER OR HOLDER WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT (A) IT IS NOT AND FOR SO LONG AS IT HOLDS THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT BE (I) AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), THAT
IS SUBJECT TO TITLE I OF ERISA, (II) A “PLAN” AS DEFINED IN AND SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) AN ENTITY OR ACCOUNT WHOSE UNDERLYING ASSETS ARE DEEMED TO INCLUDE THE ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR OTHER PLAN SUBJECT TO SECTION 4975 OF THE CODE OR (IV) A NON U.S., GOVERNMENTAL, CHURCH OR OTHER BENEFIT PLAN WHICH IS SUBJECT TO ANY NON U.S. OR U.S. FEDERAL, STATE, OR LOCAL LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF TITLE I OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) (EACH OF (I), (II), (III) AND (IV), A “PLAN”), (B) NO ASSETS OF A PLAN HAVE BEEN USED BY IT TO ACQUIRE THIS NOTE (OR ANY INTEREST HEREIN) OR (C) ITS PURCHASE AND HOLDING OF THIS NOTE (OR ANY INTEREST HEREIN) WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH AN EXEMPTION IS NOT AVAILABLE OR VIOLATION OF ANY SIMILAR LAW, AND NONE OF THE ISSUER, THE INITIAL PURCHASERS NOR ANY OF THEIR RESPECTIVE AFFILIATES IS ITS FIDUCIARY IN CONNECTION WITH THE PURCHASE AND HOLDING OF THIS NOTE.
[IN THE CASE OF ADDITIONAL REGULATION S NOTES: THIS NOTE SHALL BEAR THE TEMPORARY CUSIP AND TEMPORARY ISIN NUMBERS INDICATED ON THIS NOTE UNTIL THE DAY THAT IS 40 DAYS AFTER [●], AFTER WHICH DATE THE PERMANENT CUSIP AND PERMANENT ISIN NUMBERS INDICATED ON THIS NOTE SHALL BE BORNE.]
5.250% SENIOR NOTE DUE 2027
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc., a Delaware corporation, for value received, jointly and severally promise to pay to [●] or registered assigns the principal sum of $[●] (as such amount may be increased or decreased as indicated in Schedule A (Schedule of Principal Amount) of this Note) on August 15, 2027.
From [ ] or from the most recent Interest Payment Date to which interest has been paid or provided for, cash interest on this Note will accrue at 5.250%, payable semi-annually on May 15 and November 15 of each year, beginning on [●], to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the Business Day immediately preceding such Interest Payment Date, as the case may be.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. have caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARDAGH PACKAGING FINANCE PLC
By:
Name:
Title:Authorized Signatory
ARDAGH HOLDINGS USA INC.
By:
Name:
Title:Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
5.250% Senior Secured Note Due 2027
1.Interest
Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland, and Ardagh Holdings USA Inc. a Delaware corporation (each corporation, and such respective successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuers”), for value received, promises to pay interest on the principal amount of this Note from [●] at the rate per annum of 5.250%. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a)All payments that the Issuers make under or with respect to the Notes or that the Guarantors make under or with respect to the Guarantees shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any Issuer or Guarantor is organized, resident or doing business for tax purposes or from or through which any of the foregoing (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless such Issuer or Guarantor or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If either Issuer, a Guarantor or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note or any Guarantee, such Issuer or Guarantor, as the case may be, shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes, after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b)None of the Issuers or Guarantors will, however, pay Additional Amounts in respect or on account of:
(i)any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes or any Guarantee, or the exercise or enforcement of rights under any Notes or any Guarantee);
(ii)any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuers’ written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing
Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii)any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv)any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note or any Guarantee;
(v)any Tax imposed on or with respect to any payment by any of the Issuers or Guarantors to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi)any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii)any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii)any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(ix)any combination of the foregoing.
(c)The Issuers and the Guarantors, if the applicable withholding agents, shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d)At least 30 calendar days prior to each date on which any payment under or with respect to this Note or any Guarantee is due and payable, if the Issuers or any Guarantor shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note or any Guarantee is due and payable, in which case it will be promptly thereafter), the Issuers shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and setting forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuers shall promptly publish a notice in accordance with Section 12.02 of
the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts.
In addition, the Issuers or any Guarantor, as the case may be, shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any Guarantee or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note or any Guarantee.
Upon written request, any of the Issuers or a Guarantor will furnish to the Trustee or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by such Issuer or such Guarantor (as the case may be) of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of such Issuer or Guarantor to obtain such receipts, the same are not obtainable, such Issuer or such Guarantor will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by such Issuer or Guarantor. If requested by the Trustee, the Issuers and (to the extent necessary) any Guarantors will provide to the Trustee such information as may be reasonably available to such Issuers and the Guarantors (and not otherwise in the possession of the Trustee) to enable the determination of the amount of any withholding taxes attributable to any particular Holder(s).
(e)Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this or any other Note (including payments thereof made pursuant to a Guarantee), such reference includes the payment of Additional Amounts, if applicable.
(f)This paragraph 2 will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which any successor Person to any of the Issuers or Guarantors is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on this or any other Note (or any Guarantee) and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuers shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next Interest Payment Date even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuers shall pay principal and interest in dollars in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuers by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent, and Citigroup Global Markets Europe AG will act as Registrar. The Issuers or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuers issued this Note under an indenture dated as of August 12, 2019 (the “Indenture”), among, inter alios, the Issuers, Ardagh Group S.A., as parent guarantor (the “Parent Guarantor”) and Citibank, N.A., London Branch, as trustee (the “Trustee”). The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuers, the Guarantors and their Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting the Parent Guarantor and its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Parent Guarantor and the Restricted Subsidiaries, Change of Control and Liens.
6.Optional Redemption
(a)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may on any one or more occasions redeem up to 40% of the aggregate principal amount of the Notes at a Redemption Price of 105.250% of their principal amount, plus accrued and unpaid interest, if any, to (but excluding) the Redemption Date (subject to the rights of holders of Notes on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds from one or more Public Equity Offerings. The Issuers may only do this, however, if (i) at least 60% of the aggregate principal amount of the applicable series of Notes that were initially issued would remain outstanding immediately after the proposed redemption; and (ii) the redemption occurs within 120 days after the closing of such Public Equity Offering.
(b)At any time prior to August 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuers may also redeem all or part of the Notes at a Redemption Price equal to 100% of the principal amount of the Notes being redeemed plus the Applicable Redemption Premium and accrued and unpaid interest to the Redemption Date.
“Applicable Redemption Premium” means, with respect to any Note on any Redemption Date, the greater of:
(1)1.0% of the principal amount of such Note; and
(2)the excess of:
(i)the present value at such Redemption Date of (x) the Redemption Price of such Note at August 15, 2022 (such Redemption Price being set forth in the table appearing below in clause (c)), plus (y) all required interest payments due on such Note through August 15, 2022 (excluding accrued but unpaid interest), computed
using a discount rate equal to the Treasury Rate as of such Redemption Date plus 50 basis points; over
(ii)the outstanding principal amount of such Note.
“Treasury Rate” means, as of any Redemption Date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the Redemption Date) of the yield to maturity of United States Treasury securities with a constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 Redemption Date to August 15, 2022; provided, however, that if the period from the Redemption Date to August 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Redemption Date to August 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
(c)At any time on or after August 15, 2022 and prior to maturity, upon not less than 10 nor more than 60 days’ notice, the Issuers may redeem all or part of the Notes. These redemptions will be in amounts of $1,000 or integral multiples thereof at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to the Redemption Date, if redeemed during the 12‑month period commencing on August 15 of the years set forth below (subject to the right of holders of record on the relevant regular Record Date that is prior to the Redemption Date to receive interest due on an interest payment date).
Year |
Redemption Price Notes |
2022............................................................................................................................................... |
|
2023............................................................................................................................................... |
|
2024 and thereafter....................................................................................................................... |
|
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent.
7.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuers, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to (but excluding) the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such
laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing sub-clauses (a) and (b), a “Change in Tax Law”), the Issuers would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in paragraph 2), with respect to the Relevant Taxing Jurisdiction, which the Issuers cannot avoid by the use of reasonable measures available to the Issuers. Prior to the giving of any notice of redemption pursuant to this paragraph 7, the Issuers shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuers taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuers of recognized standing qualified under the laws of the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuers has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on Holders of the Notes.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuers would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
8.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than $200,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of $1,000 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
9.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuers or the Parent Guarantor shall offer to purchase on the Change of Control Purchase Date all or any part (equal to $200,000 or an integral multiple of $1,000 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuers and the Parent Guarantor shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to paragraph 6 or paragraph 7 of this Note. The Issuers shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders of the Notes must follow to accept the Change of Control Offer.
When the aggregate amount of Excess Proceeds exceeds the greater of $100,000,000 and 1.5% of Total Assets, the Parent Guarantor or the Issuers shall, within 20 Business Days, make an offer to purchase (an “Excess Proceeds Offer”) from all Holders and from the holders of any Pari Passu Debt, to the extent required by the terms thereof, on a pro rata basis, in accordance with the procedures set forth in the Indenture or the agreements governing any such Pari Passu Debt, the maximum principal amount (expressed as an integral multiple of $1,000 with respect to the Notes) of the Notes and any such Pari Passu Debt that may be purchased with the amount of the Excess Proceeds. The offer price as to each Note and any such Pari Passu Debt will be payable in cash in an amount equal to (solely in the case of the Notes) 100% of the principal amount of such Note and (solely in the case of Pari Passu Debt) no greater than 100% of the principal amount (or accreted value, as applicable) of such Pari Passu Debt, plus in each case accrued and unpaid interest, if any, to the date of purchase.
To the extent that the aggregate principal amount of Notes and any such Pari Passu Debt tendered pursuant to an Excess Proceeds Offer is less than the aggregate amount of Excess Proceeds, the Parent Guarantor may use the amount of such Excess Proceeds not used to purchase Notes and Pari Passu Debt for general corporate purposes that are not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and any such Pari Passu Debt validly tendered and not withdrawn by holders thereof exceeds the aggregate amount of Excess Proceeds, the Notes and any such Pari Passu Debt to be purchased shall be selected by the Trustee on a pro rata basis (based upon the principal amount of Notes and the principal amount or accreted value of such Pari Passu Debt tendered by each holder). Upon completion of each such Excess Proceeds Offer, the amount of Excess Proceeds will be reset to zero.
10.Denominations
The Notes (including this Note) are in denominations of $200,000 and integral multiples of $1,000 in excess thereof of principal amount at maturity. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
11.Unclaimed Money
All moneys paid by the Issuers or the Guarantors to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such principal, premium or interest has become due and payable may be repaid to the Issuers or the Guarantors, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuers or the Guarantors for payment thereof.
12.Discharge and Defeasance
Subject to certain conditions, the Issuers at any time may terminate some or all of its obligations and the obligations of the Guarantors under this Note and each other Note, the Guarantees and the Indenture if the Issuers irrevocably deposit with the Trustee dollars or U.S. Government Securities for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
13.Amendment, Supplement and Waiver
(a)(i) The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Guarantors and the Trustee may modify, amend or supplement the Indenture, any Guarantee or this Note and each other Note and the Issuers, when authorized by a resolution of its Board of Directors, in each case without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Parent Guarantor and the assumption by any such successor of the covenants in the Indenture and in this Note and each other Note; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of Article Five shall apply mutatis mutandis);
(B)to add to the covenants of the Issuers, any Guarantor or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuers, any Guarantor, or any other obligor upon this Note and each other Note, as applicable, in the Indenture, in this Note and each other Note or in any Guarantees;
(C)to cure any ambiguity, or to correct or supplement any provision in the Indenture, this Note and each other Note or any Guarantees that may be defective or inconsistent with any other provision in the Indenture, this Note and each other Note or any Guarantee or make any other provisions with respect to matters or questions arising under the Indenture, the Notes or any Guarantee; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Guarantees or the Notes to any provision of the “Description of the Senior Notes” section of the Offering Memorandum to the extent that such provision in the “Description of the Senior Notes” was intended to be a verbatim recitation of a provision of the Indenture, the Guarantees or the Notes;
(E)to release any Guarantor in accordance with and if permitted by the terms of and limitations set forth in the Indenture and to add a Subsidiary Guarantor or other guarantor under the Indenture (which will require execution of the relevant supplemental indenture only by the Issuers, the Parent Guarantor and such additional Subsidiary Guarantor(s) or other guarantor(s));
(F)to evidence and provide the acceptance of the appointment of a successor Trustee under the Indenture; or
(G)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii)The Issuers, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Trustee), the Parent Guarantor, the Trustee and the Restricted Subsidiary being added as a Subsidiary Guarantor or other entity becoming a Guarantor under the Indenture may supplement the Indenture to add a Subsidiary Guarantor or other guarantor under the Indenture, in each case without notice to or consent of any Holder.
(iii)In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
(b)Except as provided in paragraph 13(c) of this Note and Section 6.04 of the Indenture, respectively, and without prejudice to paragraph 13(a) of this Note, the Issuers, the Guarantors and the Trustee may:
(i)modify, amend or supplement the Indenture or this Note and the other Notes; or
(ii)waive compliance by the Issuers with any provision of the Indenture or this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes); provided that, if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required;
(c)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 9.01 of the Indenture, may:
(i)change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(ii)reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(iii)change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(iv)impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(v)reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(vi)modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(vii)make any change to the Intercreditor Agreement (or any Additional Intercreditor Agreement) or any provisions of the Indenture affecting the ranking of the Notes or the Guarantees, in each case in a manner that adversely affects the rights of the Holders; or
(viii)make any change in Section 4.12 of the Indenture that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuers or the Guarantors agree to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(d) The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient
if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
14.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in clauses (ix) and (x) of Section 6.01(a) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuers and the Parent Guarantor (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note or the other Notes except as provided in the Indenture and subject to the Intercreditor Agreement and any Additional Intercreditor Agreement. The Trustee may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations and the Intercreditor Agreement (and any Additional Intercreditor Agreement), the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
15.Ranking
This Note and the other Notes will be general obligations of each Issuer and will rank senior in right of payment to any and all of each Issuer’s existing and future Debt that is subordinated in right of payment to the Notes, rank equally in right of payment with all of each Issuer’s existing and future Debt that is not subordinated in right of payment to the Notes, and be structurally subordinated to all existing and future indebtedness of the Parent Guarantor’s Subsidiaries that do not provide Guarantees.
16.Guarantees
The Subsidiary Guarantees will be subordinated in right of payment to Senior Debt and will be subject to certain limitations on enforcement in favor of holders of Senior Debt, all as provided in the Indenture.
17.Trustee Dealings with the Issuers
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers, the Guarantors or any of their Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
18.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuers or the Guarantors shall not have any liability for any obligations of the Issuers or the Guarantors under this Note, the other Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
19.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
20.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
21.ISIN and CUSIP Numbers
The Issuers may cause ISIN and CUSIP numbers to be printed on the Notes, and if so the Trustee shall use ISIN and CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
22.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuers) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuers or any of their respective Affiliates, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Parent Guarantor or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have
certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuers reasonably request to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or Section 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of $200,000 or any integral multiple of $1,000 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
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EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM RESTRICTED
GLOBAL NOTE TO REGULATION S GLOBAL NOTE.*
Transfers pursuant to Section 2.06(b)(ii) of the Indenture
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: 5.250% Senior Notes due 2027 (the “Notes”)
Reference is hereby made to the Indenture dated as of August 12, 2019 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to $____________ aggregate principal amount of Notes that are held as a beneficial interest in the form of the Restricted Global Note ([CUSIP No. [●]]; [ISIN No: [●]]) with DTC in the name of [name of transferor] (the “Transferor”). The Transferor has requested an exchange or transfer of such beneficial interest for an equivalent beneficial interest in the Regulation S Global Note ([CUSIP No. [●]]; [ISIN No: [●]]).
In connection with such request, the Transferor does hereby certify that such transfer has been effected in accordance with the transfer restrictions set forth in the Notes and:
(a)with respect to transfers made in reliance on Regulation S (“Regulation S”) under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), does certify that:
(i)the offer of the Notes was not made to a person in the United States;
(ii)either (i) at the time the buy order is originated the transferee is outside the United States or the Transferor and any person acting on its behalf reasonably believe that the transferee is outside the United States or; (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market described in paragraph (b) of Rule 902 of Regulation S and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States
(iii)no directed selling efforts have been made in the United States by the Transferor, an affiliate thereof or any person their behalf in contravention of the requirements of Rule 903 or 904 of Regulation S, as applicable;
(iv)the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act; and
(v)the Transferor is not an Issuer, a distributor of the Notes, an affiliate of an Issuer or any such distributor (except any officer or director who is an affiliate solely by virtue of holding such position) or a person acting on behalf of any of the foregoing.
(b)with respect to transfers made in reliance on Rule 144 the Transferor certifies that the Notes are being transferred in a transaction permitted by Rule 144 under the U.S. Securities Act.
You, the Issuers, the Guarantors and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
____________________
*If the Note is a Definitive Note, appropriate changes need to be made to the form of this transfer certificate.
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM REGULATION S
GLOBAL NOTE TO RESTRICTED GLOBAL NOTE
Transfers pursuant to Section 2.06(b)(iii) of the Indenture
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re: 5.250% Senior Notes due 2027 (the “Notes”)
Reference is hereby made to the Indenture dated as of August 12, 2019 (the “Indenture”) among, inter alios, Ardagh Packaging Finance plc, a public limited company incorporated under the laws of Ireland and Ardagh Holdings USA Inc., a Delaware corporation, collectively, as Issuers, Ardagh Group S.A., as Parent Guarantor, and Citibank, N.A., London Branch, as Trustee. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to $__________ aggregate principal amount at maturity of Notes that are held in the form of the Regulation S Global Note with DTC ([CUSIP No.: [●]]; [ISIN No. [●]]) in the name of [name of transferor] (the “Transferor”) to effect the transfer of the Notes in exchange for an equivalent beneficial interest in the Restricted Global Note ([CUSIP No.: [●]]; [ISIN No. [●]]).
In connection with such request, and in respect of such Notes the Transferor does hereby certify that such Notes are being transferred in accordance with the transfer restrictions set forth in the Notes and that:
CHECK ONE BOX BELOW:
☐the Transferor is relying on Rule 144A under the Securities Act for exemption from such Act’s registration requirements; it is transferring such Notes to a person it reasonably believes is a QIB as defined in Rule 144A that purchases for its own account, or for the account of a qualified institutional buyer, and to whom the Transferor has given notice that the transfer is made in reliance on Rule 144A and the transfer is being made in accordance with any applicable securities laws of any state of the United States; or
☐the Transferor is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act, subject to the Issuers’ and the Trustee’s right prior to any such offer, sale or transfer to require the delivery of an Opinion of Counsel, certification and/or other information satisfactory to each of them.
You, the Issuers, the Guarantors, and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attention:
Exhibit 99.7
Execution Version
ARD Finance s.a.
AS ISSUER,
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Principal Paying Agent, Transfer Agent and Security Agent,
and
CITIGROUP GLOBAL MARKETS Europe AG,
as Registrar
_____________________________
Indenture
Dated as of November 20, 2019
_____________________________
Dollar denominated 6.500% / 7.250% Senior Secured
Toggle Notes due 2027
euro denominaTed 5.000% / 5.750% Senior Secured
Toggle Notes due 2027
TABLE OF CONTENTS
Page
ARTICLE One
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.Certain Definitions....................................................................................................................1
SECTION 1.02.Other Definitions.....................................................................................................................25
SECTION 1.03.Rules of Construction...............................................................................................................27
SECTION 1.04.Financial Calculations...............................................................................................................27
ARTICLE Two
THE NOTES
SECTION 2.01.The Notes...............................................................................................................................28
SECTION 2.02.Execution and Authentication...................................................................................................30
SECTION 2.03.Registrar, Transfer Agent and Paying Agent...............................................................................30
SECTION 2.04.Paying Agent to Hold Money...................................................................................................31
SECTION 2.05.Holder Lists.............................................................................................................................32
SECTION 2.06.Transfer and Exchange.............................................................................................................32
SECTION 2.07.Replacement Notes.................................................................................................................35
SECTION 2.08.Outstanding Notes...................................................................................................................35
SECTION 2.09.Notes Held by Issuer...............................................................................................................35
SECTION 2.10.Certificated Notes...................................................................................................................35
SECTION 2.11.Cancellation...........................................................................................................................36
SECTION 2.12.Defaulted Interest...................................................................................................................36
SECTION 2.13.Computation of Interest...........................................................................................................37
SECTION 2.14.ISIN, CUSIP and Common Code Numbers...................................................................................37
SECTION 2.15.Issuance of PIK Interest...........................................................................................................37
SECTION 2.16.Tax Treatment of the Notes.....................................................................................................37
ARTICLE Three
REDEMPTION; OFFERS TO PURCHASE
SECTION 3.01.Right of Redemption...............................................................................................................37
SECTION 3.02.Notices to Trustee...................................................................................................................37
SECTION 3.03.Selection of Notes to Be Redeemed.........................................................................................38
SECTION 3.04.Notice of Redemption.............................................................................................................38
SECTION 3.05.Deposit of Redemption Price...................................................................................................39
SECTION 3.06.Payment of Notes Called for Redemption.................................................................................39
SECTION 3.07.Notes Redeemed in Part.........................................................................................................39
ARTICLE Four
COVENANTS
SECTION 4.01.Payment of Notes...................................................................................................................40
SECTION 4.02.Corporate Existence.................................................................................................................40
SECTION 4.03.Maintenance of Properties.......................................................................................................40
SECTION 4.04.Insurance...............................................................................................................................40
SECTION 4.05.Statement as to Compliance.....................................................................................................41
SECTION 4.06.Limitation on Debt...................................................................................................................41
SECTION 4.07.Limitation on Liens...................................................................................................................44
SECTION 4.08.Limitation on Restricted Payments...........................................................................................44
SECTION 4.09.Limitation on Sale of Certain Assets.........................................................................................47
SECTION 4.10.Limitation on Transactions with Affiliates...................................................................................48
SECTION 4.11.Purchase of Notes upon a Change of Control.............................................................................49
SECTION 4.12.Additional Amounts.................................................................................................................51
SECTION 4.13.Minimum Ownership of Voting and Economic Rights.................................................................53
SECTION 4.14.Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries...........53
SECTION 4.15.Designation of Unrestricted and Restricted Subsidiaries.............................................................55
SECTION 4.16.Payment of Taxes and Other Claims.........................................................................................55
SECTION 4.17.Reports to Holders...................................................................................................................55
SECTION 4.18.Further Instruments and Acts...................................................................................................56
SECTION 4.19.Security Confirmations; Further Security...................................................................................56
SECTION 4.20.Escrow Accounts.....................................................................................................................56
ARTICLE Five
CONSOLIDATION, MERGER AND SALE OF ASSETS
SECTION 5.01.Consolidation, Merger and Sale of Assets.................................................................................57
SECTION 5.02.Successor Substituted.............................................................................................................58
ARTICLE Six
DEFAULTS AND REMEDIES
SECTION 6.01.Events of Default.....................................................................................................................58
SECTION 6.02.Acceleration...........................................................................................................................60
SECTION 6.03.Other Remedies.....................................................................................................................61
SECTION 6.04.Waiver of Past Defaults...........................................................................................................61
SECTION 6.05.Control by Majority.................................................................................................................61
SECTION 6.06.Limitation on Suits...................................................................................................................62
SECTION 6.07.Unconditional Right of Holders to Bring Suit for Payment...........................................................62
SECTION 6.08.Collection Suit by Trustee.........................................................................................................62
SECTION 6.09.Trustee May File Proofs of Claim...............................................................................................62
SECTION 6.10.Application of Money Collected...............................................................................................63
SECTION 6.11.Undertaking for Costs.............................................................................................................63
SECTION 6.12.Restoration of Rights and Remedies.........................................................................................63
SECTION 6.13.Rights and Remedies Cumulative.............................................................................................63
SECTION 6.14.Delay or Omission Not Waiver.................................................................................................64
SECTION 6.15.Record Date...........................................................................................................................64
SECTION 6.16.Waiver of Stay or Extension Laws.............................................................................................64
ARTICLE Seven
TRUSTEE AND SECURITY AGENT
SECTION 7.01.Duties of Trustee and the Security Agent...................................................................................64
SECTION 7.02.Certain Rights of Trustee and the Security Agent.......................................................................65
SECTION 7.03.Individual Rights of Trustee and the Security Agent...................................................................68
SECTION 7.04.Disclaimer of Trustee and Security Agent...................................................................................68
SECTION 7.05.Compensation and Indemnity...................................................................................................69
SECTION 7.06.Replacement of Trustee or Security Agent.................................................................................69
SECTION 7.07.Successor Trustee or Security Agent by Merger.........................................................................71
SECTION 7.08.Appointment of Security Agent and Supplemental Security Agents.............................................71
SECTION 7.09.Eligibility; Disqualification.......................................................................................................72
SECTION 7.10.Appointment of Co-Trustee.....................................................................................................72
SECTION 7.11.Resignation of Agents.............................................................................................................73
SECTION 7.12.Agents General Provisions.......................................................................................................73
ARTICLE Eight
DEFEASANCE; SATISFACTION AND DISCHARGE
SECTION 8.01.Issuer’s Option to Effect Defeasance or Covenant Defeasance.....................................................74
SECTION 8.02.Defeasance and Discharge.......................................................................................................75
SECTION 8.03.Covenant Defeasance.............................................................................................................75
SECTION 8.04.Conditions to Defeasance.........................................................................................................75
SECTION 8.05.Satisfaction and Discharge of Indenture.....................................................................................76
SECTION 8.06.Survival of Certain Obligations.................................................................................................77
SECTION 8.07.Acknowledgment of Discharge by Trustee.................................................................................77
SECTION 8.08.Application of Trust Money.......................................................................................................77
SECTION 8.09.Repayment to Issuer...............................................................................................................77
SECTION 8.10.Indemnity for Government Securities.......................................................................................78
SECTION 8.11.Reinstatement.......................................................................................................................78
ARTICLE Nine
AMENDMENTS AND WAIVERS
SECTION 9.01.Without Consent of Holders.....................................................................................................78
SECTION 9.02.With Consent of Holders.........................................................................................................79
SECTION 9.03.Effect of Supplemental Indentures...........................................................................................80
SECTION 9.04.Notation on or Exchange of Notes.............................................................................................80
SECTION 9.05.[Reserved].............................................................................................................................80
SECTION 9.06.Notice of Amendment or Waiver...............................................................................................80
SECTION 9.07.Trustee to Sign Amendments, Etc..............................................................................................80
SECTION 9.08.Additional Voting Terms; Calculation of Principal Amount...........................................................81
ARTICLE Ten
[RESERVED]
ARTICLE Eleven
SECURITY
SECTION 11.01.Security; Security Documents...................................................................................................81
SECTION 11.02.Authorization of Actions to Be Taken by the Security Agent Under the Security Documents...........82
SECTION 11.03.Authorization of Receipt of Funds by the Security Agent Under the Security Documents...............82
SECTION 11.04.Release of the Collateral.........................................................................................................82
SECTION 11.05.Parallel Debt...........................................................................................................................83
ARTICLE Twelve
MISCELLANEOUS
SECTION 12.01.[Reserved].............................................................................................................................84
SECTION 12.02.Notices.....................................................................................................................................84
SECTION 12.03.Certificate and Opinion as to Conditions Precedent...................................................................86
SECTION 12.04.Statements Required in Certificate or Opinion...........................................................................86
SECTION 12.05.Rules by Trustee, Paying Agent and Registrar.............................................................................86
SECTION 12.06.Legal Holidays.........................................................................................................................86
SECTION 12.07.Governing Law.........................................................................................................................86
SECTION 12.08.Jurisdiction.............................................................................................................................87
SECTION 12.09.No Recourse Against Others.....................................................................................................87
SECTION 12.10.Successors...............................................................................................................................87
SECTION 12.11.Multiple Originals...................................................................................................................87
SECTION 12.12.Table of Contents, Cross-Reference Sheet and Headings...........................................................87
SECTION 12.13.Severability.............................................................................................................................87
SECTION 12.14.Currency Indemnity.................................................................................................................87
SECTION 12.15.Contractual Recognition of Bail-In.............................................................................................88
Exhibits
Exhibit A-1-Form of Dollar Notes
Exhibit A-2-Form of Euro Notes
Exhibit B-Form of Transfer Certificate for Transfer from Restricted Global Note to Regulation S Global Note
Exhibit C-Form of Transfer Certificate for Transfer from Regulation S Global Note to Restricted Global Note
INDENTURE dated as of November 20, 2019 among ARD Finance S.A., a public limited liability company (société anonyme) incorporated and existing under the laws of the Grand Duchy of Luxembourg, with registered office at 56, rue Charles Martel, L-2134 Luxembourg and registered with the Luxembourg register of Commerce and Companies under number B 160806 (the “Issuer”), Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as Transfer Agent, Citibank, N.A., London Branch, as security agent (the “Security Agent”), and Citigroup Global Markets Europe AG, as registrar (the “Registrar”).
RECITALS OF THE ISSUER
The Issuer has duly authorized the execution and delivery of this Indenture to provide for the issuance of (i) its euro denominated 5.000% / 5.750% Senior Secured Toggle Notes due 2027 issued on the date hereof (the “Original Euro Notes”) and any additional euro denominated notes (“Additional Euro Notes” and, together with the Original Euro Notes, the “Euro Notes”) that may be issued after the Issue Date (as defined herein) and (ii) its dollar denominated 6.500% / 7.250% Senior Secured Toggle Notes due 2027 (the “Original Dollar Notes” and, together with the Original Euro Notes, the “Original Notes”) and any additional dollar denominated notes (“Additional Dollar Notes” and, together with the Original Dollar Notes, the “Dollar Notes”) that may be issued after the Issue Date (Additional Euro Notes and Additional Dollar Notes together, the “Additional Notes”). The Original Notes and any Additional Notes together are the “Notes.” The Issuer has received good and valuable consideration for the execution and delivery of this Indenture. All necessary acts and things have been done to make (i) the Notes, when duly issued and executed by the Issuer and authenticated and delivered hereunder, the legal, valid and binding obligations of the Issuer and (ii) this Indenture a legal, valid and binding agreement of the Issuer in accordance with the terms of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:
“2019 Indenture” means the indenture governing the August 2019 Senior Notes as replaced, refinanced, amended or supplemented.
“Acquired Debt” means Debt of a Person:
(a)existing at the time such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Issuer or any of its Restricted Subsidiaries; or
(b)assumed in connection with the acquisition of assets from any such Person;
provided in each case that such Debt was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary or such acquisition, as the case may be. Acquired Debt will be deemed to be incurred on the date the acquired Person becomes a Restricted Subsidiary or the date of the related acquisition of assets from any Person.
“Affiliate” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“AGSA” means Ardagh Group S.A., a public limited liability company (société anonyme) incorporated and existing under the laws of Luxembourg, and its successors.
“Applicable Law” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“Asset Sale” means any sale, issuance, conveyance, transfer, lease or other disposition (including, without limitation, by way of merger, consolidation or sale and leaseback transaction) (collectively, a “transfer”), directly or indirectly, in one or a series of related transactions, of:
(a)any Capital Stock of any Restricted Subsidiary of such Person (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Issuer or a Restricted Subsidiary of the Issuer);
(b)all or substantially all of the properties and assets of any division or line of business of such Person or any Restricted Subsidiary of such Person; or
(c)any other of such Person’s or any of such Person’s Restricted Subsidiary’s properties or assets.
Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(i)any transfer or disposition of assets that is governed by the provisions of Article Five and Section 4.11 or any transfer or disposition of assets consummated in connection with a Permitted Reorganization;
(ii)any transfer or disposition of assets by any Restricted Subsidiary of the Issuer to the Issuer or to any other Restricted Subsidiary of the Issuer in accordance with the terms of this Indenture;
(iii)any transfer or disposition of obsolete or permanently retired equipment or facilities that are no longer useful in the conduct of the Issuer’s and any of the Issuer’s Restricted Subsidiary’s business and that are disposed of in the ordinary course of business;
(iv)any disposition of accounts receivable and related assets in a Permitted Receivables Financing;
(v)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(vi)the foreclosure, condemnation or any similar action with respect to any property or other assets;
(vii)any unwinding or termination of hedging obligations not for speculative purposes;
(viii)any single transaction or series of related transactions that involves assets or Capital Stock having a Fair Market Value of less than the greater of $50,000,000 and 0.75% of Total Assets;
(ix)for the purposes of Section 4.09 only, the making of a Permitted Investment or a disposition permitted under Section 4.08; or, solely for purposes of Section 4.09(b), asset sales, the proceeds of which are used within 540 days of receipt of such proceeds to make such Restricted Payments, Permitted Payments or Permitted Investments;
(x)the sale, lease or other disposition of equipment, inventory, property or other assets in the ordinary course of business;
(xi)the lease, assignment or sublease of any real or personal property in the ordinary course of business;
(xii)an issuance of Capital Stock by a Restricted Subsidiary of such Person or to another Restricted Subsidiary of such Person;
(xiii)a Permitted Investment or a Restricted Payment (or a transaction that would constitute a Restricted Payment but for the exclusions from the definition thereof) that is not prohibited by Section 4.08 or a “restricted payment” (or a transaction that would constitute a “restricted payment” but for the exclusions from the definition thereof) and “permitted investments” as defined in the 2019 Indenture and not prohibited by the covenant limiting restricted payments thereof;
(xiv)any disposition of Capital Stock, Debt or other securities of any Unrestricted Subsidiary or a Permitted Joint Venture;
(xv)sales of assets received by such Person or any Restricted Subsidiary of such Person upon the foreclosure on a Lien granted in favor of such Person or any Restricted Subsidiary of such Person;
(xvi)sales or grants of licenses to use the patents, trade secrets, know‑how and other intellectual property of the Issuer or any of its Restricted Subsidiaries to the extent that such license does not prohibit the Issuer or any of its Restricted Subsidiaries from using the technologies licensed (other than pursuant to exclusivity or non‑competition arrangements negotiated on an arm’s‑length basis) or require the Issuer or any of its Restricted Subsidiaries to pay any fees for any such use;
(xvii)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business; or
(xviii)sales, issuances, conveyances, transfers, leases or other dispositions to the extent constituting Permitted Liens.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“August 2019 Secured Notes” means the existing €440,000,000 aggregate principal amount of 2.125% Senior Secured Notes due 2026 and the $500,000,000 aggregate principal amount of 4.125% Senior Secured Notes due 2026.
“August 2019 Senior Notes” means the existing $800,000,000 aggregate principal amount of 5.250% Senior Notes due 2027.
“Available Restricted Payment Amount” means 50% of the amount equal to (i) the aggregate amount of cash from dividends or other distributions (including by way of redemptions or repurchases of shares) received by the Issuer, directly or indirectly, from its Subsidiaries following the Issue Date less (ii) any amounts used from such dividends or other distributions to pay Cash Interest on the Notes.
“Average Life” means, as of the date of determination with respect to any Debt, the quotient obtained by dividing:
(a)the sum of the products of:
(i)the numbers of years from the date of determination to the date or dates of each successive scheduled principal payment of such Debt multiplied by
(ii)the amount of each such principal payment; by
(b)the sum of all such principal payments.
“Bankruptcy Law” means any law relating to bankruptcy, insolvency, receivership, moratorium, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law, including, without limitation, (i) bankruptcy law of Ireland, (ii) bankruptcy law of The Netherlands, (iii) bankruptcy law of England, (iv) bankruptcy law of Germany, (v) bankruptcy law of Sweden, (vi) bankruptcy law of Denmark, (vii) bankruptcy law of Poland, (viii) bankruptcy law of Italy, (ix) bankruptcy law of Luxembourg or (x) Title 11, United States Bankruptcy Code of 1978, as amended.
“Board of Directors” means (i) with respect to any corporation, the board of directors or managers, as applicable, of the corporation, or any duly authorized committee thereof; (ii) with respect to any partnership, the board of directors or other governing body of the general partner, as applicable, of the partnership or any duly authorized committee thereof; (iii) with respect to a limited liability company, the managing member or members or any duly authorized controlling committee thereof; and (iv) with respect to any other Person, the board or any duly authorized committee of such Person serving a similar function. Whenever any provision of this Indenture requires any action or determination to be made by, or any approval of, a Board of Directors (including for the avoidance of doubt any committee thereof), such action, determination or approval shall be deemed to have been taken or made if approved by a majority of the directors (excluding employee representatives, if any) on any such Board of Directors (whether or not such action or approval is taken as part of a formal board meeting or as a formal board approval), including for the avoidance of doubt any committee thereof. Unless the context requires otherwise, Board of Directors means the Board of Directors of the Issuer.
“Book-Entry Interest” means a beneficial interest in a Global Note held through and shown on, and transferred only through, records maintained in book-entry form by DTC, Euroclear or Clearstream and their respective nominees and successors, in the case of Euroclear and Clearstream, acting through themselves or the Common Depositary.
“Bund Rate” means, with respect to any redemption date, the rate per annum equal to the equivalent yield to maturity as of such redemption date of the Comparable German Bund Issue, assuming a price for the Comparable German Bund Issue (expressed as a percentage of its principal amount) equal to the Comparable German Bund Price for such redemption date, where:
(a)“Comparable German Bund Issue” means the German Bundesanleihe security selected by any Reference German Bund Dealer as having a fixed maturity most nearly equal to the period from such redemption date to November 15, 2022, and that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of euro denominated corporate debt securities in a principal amount approximately equal to the then outstanding principal amount of the Euro Notes and of a maturity most nearly equal to November 15, 2022; provided that if the period from such redemption date to November 15, 2022 is less than one year, a fixed maturity of one year shall be used;
(b)“Comparable German Bund Price” means, with respect to any redemption date, the average of the Reference German Bund Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference German Bund Dealer Quotations, or if the Issuer obtains fewer than four such Reference German Bund Dealer Quotations, the average of all such quotations;
(c)“Reference German Bund Dealer” means any dealer of German Bundesanleihe securities appointed by the Issuer (and notified to the Trustee); and
(d)“Reference German Bund Dealer Quotations” means, with respect to each Reference German Bund Dealer and any redemption date, the average as determined by the Issuer of the bid and offered prices for the Comparable German Bund Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Issuer by such Reference German Bund Dealer at 3:30 p.m. Frankfurt, Germany time on the third Business Day preceding such redemption date.
“Business Day” means a day of the year on which banks are not required or authorized by law to close in Dublin, New York City, Luxembourg or London and, in relation to a transaction involving euro, any TARGET Day.
“Capital Stock” means, with respect to any Person, any and all shares, interests, partnership interests (whether general or limited), participations, rights in or other equivalents (however designated) of such Person’s equity, any other interest or participation that confers the right to receive a share of the profits and losses, or distributions of assets of, such Person and any rights (other than debt securities convertible into or exchangeable for Capital Stock), warrants or options exchangeable for or convertible into such Capital Stock, whether now outstanding or issued after the Issue Date.
“Capitalized Lease Obligation” means, with respect to any Person, any obligation of such Person under a lease of (or other agreement conveying the right to use) any property (whether real, personal or mixed), which obligation is required to be classified and accounted for as a capital lease obligation under IFRS, and, for purposes of this Indenture, the amount of such obligation at any date will be the capitalized amount thereof at such date, determined in accordance with IFRS and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Cash Equivalents” means any of the following:
(a)any evidence of Debt with a maturity of 180 days or less from the date of acquisition issued or directly and fully guaranteed or insured by a member state of the European Union or European Economic Area, the United States of America, any state thereof or the District of Columbia, Canada, Switzerland, Australia or any agency or instrumentality thereof;
(b)time deposit accounts, certificates of deposit, money market deposits or bankers’ acceptances with a maturity of 180 days or less from the date of acquisition issued by a bank or trust company having combined capital and surplus and undivided profits of not less than $500 million, whose debt has a rating, at the time any investment is made therein, of at least BBB+ or the equivalent thereof by S&P and at least Baa1 or the equivalent thereof by Moody’s;
(c)commercial paper with a maturity of 180 days or less from the date of acquisition issued by a corporation that is not either the Issuer’s or any Restricted Subsidiary’s Affiliate and is at the time of acquisition, rated at least A‑1 or the equivalent thereof by S&P or at least P‑1 or the equivalent thereof by Moody’s;
(d)repurchase obligations with a term of not more than seven days for underlying securities of the type described in clause (a) or (b) above entered into with a financial institution meeting the qualifications described in clause (b) above;
(e)investments in money market mutual funds at least 95% of the assets of which constitute Cash Equivalents of the kind described in clauses (a) through (d) above; or
(f)any investments classified as cash equivalents under IFRS.
“Change of Control” means the occurrence of any of the following events:
(a)the consummation of any transaction (including a merger or consolidation) the result of which is that (i) any person or group, other than one or more Permitted Holders, is or as a result of such transaction becomes, the beneficial owner, directly or indirectly, of more than 50% (or so long as any of the Existing Ardagh Bonds remain outstanding, 35%) of the total voting power of the Voting Stock of the Issuer and (ii) the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such other person or group;
(b)the sale, transfer, conveyance or other disposition (other than by way of merger, consolidation or transfer of the Issuer’s Voting Stock or in connection with a Permitted Reorganization) of all or substantially all of the assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Issuer and its Restricted Subsidiaries, on a consolidated basis, to any Person or group other than one or more Permitted Holders; or
(c)the Issuer is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which does not violate the provisions described under Article Five or in connection with a Permitted Reorganization.
For the purposes of this definition, (i) “person” and “group” have the meanings they have in Sections 13(d) and 14(d) of the Exchange Act; (ii) “beneficial owner” is used as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time; and (iii) a Person or group will be deemed to beneficially own all Voting Stock of an entity held by a parent entity, if such Person or group is or becomes the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of such parent entity and the Permitted Holders, individually or in the aggregate, do not beneficially own, directly or indirectly, a larger percentage of the total voting power of such Voting Stock than such Person or group.
“Clearstream” means Clearstream Banking S.A. or any successor thereto.
“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Collateral” means any and all assets from time to time in which a security interest has been or will be granted on the Issue Date or thereafter to secure obligations under this Indenture and the Notes.
“Commission” means the U.S. Securities and Exchange Commission.
“Commodity Hedging Agreements” means any type of commodity hedging agreement (including emissions hedging) designed to protect against or manage exposure to fluctuations in commodity prices and entered into in good faith for such purposes.
“Common Depositary” means a depositary common to Euroclear and Clearstream, being initially Citibank Europe plc, until a successor Common Depositary, if any, shall have become such pursuant to this Indenture, and thereafter Common Depositary shall mean or include each Person who is then a Common Depositary hereunder.
“Consolidated Adjusted Net Income” of any Person means, for any period, such Person’s and its Restricted Subsidiaries’ consolidated net income (or loss) for such period as determined in accordance with IFRS, adjusted by excluding (to the extent included in such consolidated net income or loss), without duplication:
(a)any net after‑tax extraordinary gains or losses;
(b)any net after‑tax gains or losses attributable to sales of assets of such Person or any Restricted Subsidiary of such Person that are not sold in the ordinary course of business;
(c)the portion of net income or loss of any other Person (other than such Person or a Restricted Subsidiary of such Person), including Unrestricted Subsidiaries, in which such Person or any Restricted Subsidiary of such Person has an equity ownership interest, except that such Person’s or a Restricted Subsidiary of such Person’s equity in the net income of such other Person for such period shall be included in such Consolidated Adjusted Net Income to the extent of the aggregate amount of dividends or other distributions actually paid to such Person or any Restricted Subsidiary of such Person in cash dividends or other distributions during such period;
(d)the net income or loss of any Restricted Subsidiary of such Person to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary is not at the date of determination permitted, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary or its shareholders (other than restrictions contained in the Credit Facilities and related agreements permitted by Section 4.06(b)(i);
(e)any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves or provisions therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering or refinancing of debt or equity securities;
(f)the non‑cash accounting effects of any acquisition, purchase, merger, reorganization or other similar transaction, including any increase in amortization or depreciation resulting from adjustments to tangible or intangible assets, the consequence of any revaluation of inventory or other non‑cash charges or effects (including losses on derivatives);
(g)the cumulative effect of a change in accounting principles after the Issue Date;
(h)any charge or expense recorded for non‑cash or capitalized interest on Deeply Subordinated Funding;
(i)net after tax gains or losses attributable to (i) the termination of pension plans, (ii) the acquisition of securities or the extinguishment of debt or (iii) currency exchange transactions that are not in the ordinary course of business;
(j)net income or loss attributable to discontinued operations; and
(k)any restoration to net income of any contingency reserve, except to the extent it was provided for in a prior period.
“Consolidated Fixed Charge Coverage Ratio” of any Person means, for any period, the ratio of:
(a)the sum of Consolidated Adjusted Net Income of such Person, plus in each case to the extent deducted in computing Consolidated Adjusted Net Income for such period:
(i)Consolidated Net Interest Expense of such Person;
(ii)Consolidated Tax Expense of such Person; and
(iii)Consolidated Non‑cash Charges of such Person, less all non‑cash items increasing Consolidated Adjusted Net Income of such Person for such period and less all cash payments during such period relating to non‑cash charges that were added back to Consolidated Adjusted Net Income of such Person in determining the Consolidated Fixed Charge Coverage Ratio of such Person in any prior period;
(b)to the sum of:
(i)Consolidated Net Interest Expense of such Person; and
(ii)cash and non‑cash dividends due (whether or not declared) on such Person’s and any of its Restricted Subsidiaries’ Preferred Stock (to any Person other than such Person and any Wholly Owned Restricted Subsidiary of such Person), in each case for such period;
provided that in calculating the Consolidated Fixed Charge Coverage Ratio or any element thereof for any period, pro forma effect will be given to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation;
provided further, without limiting the application of the previous proviso, that:
(v)if such Person or any Restricted Subsidiary of such Person has incurred any Debt since the beginning of such period that remains outstanding or if the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio of such Person is an incurrence of Debt or both, Consolidated Adjusted Net Income of such Person and Consolidated Net Interest Expense of such Person for such period shall be calculated after giving effect on a pro forma basis to such Debt as if such Debt had been incurred on the first day of such period and the discharge of any other Debt repaid, repurchased, defeased or otherwise discharged with the proceeds of such new Debt as if such discharge had occurred on the first day of such period;
(w)if, since the beginning of such period, such Person or any Restricted Subsidiary of such Person shall have made any Asset Sale, Consolidated Adjusted Net Income of such Person for such period shall be reduced by an amount equal to the Consolidated Adjusted Net Income of such Person (if positive) directly attributable to the assets which are the subject of such Asset Sale for such period, or increased by an amount equal to the Consolidated Adjusted Net Income of such Person (if negative) directly attributable thereto, for such period and the Consolidated Net Interest Expense of such Person for such period shall be reduced by an amount equal to the Consolidated Net Interest Expense of such Person directly attributable to any Debt of such Person or of any Restricted Subsidiary thereof repaid, repurchased, defeased or otherwise discharged with respect to such Person and the continuing Restricted Subsidiaries thereof in connection with such Asset Sale for such period (or, if the Capital Stock of any Restricted Subsidiary of such Person is sold, the Consolidated Net Interest Expense of such Person for such period directly attributable to the Debt of such Restricted Subsidiary to the extent such Person and the continuing Restricted Subsidiaries thereof are no longer liable for such Debt after such sale);
(x)if, since the beginning of such period, such Person or any Restricted Subsidiary thereof (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary of such Person (or any Person which becomes a Restricted Subsidiary of such Person) or an acquisition of assets, including any acquisition of an asset occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, Consolidated Adjusted Net Income of such Person and Consolidated Net Interest Expense of such Person for such period shall be calculated after giving pro forma effect thereto (including the incurrence of any Debt) as if such Investment or acquisition occurred on the first day of such period;
(y)if, since the beginning of such period, any other Person (that subsequently became a Restricted Subsidiary of such Person or was merged with or into such Person or any Restricted Subsidiary thereof since the beginning of such period) shall have made any Asset Sale or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (x) or (y) above if made by such Person or a Restricted Subsidiary thereof during such period, Consolidated Adjusted Net Income of such Person and Consolidated Net Interest Expense of such Person for such period shall be calculated after giving pro forma effect thereto as if such Asset Sale or Investment or acquisition occurred on the first day of such period; and
(z)the pro forma calculation shall not give effect to: (i) any amounts under clause (b) above attributable to Debt or Preferred Stock incurred on such determination date pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock incurred pursuant to Section
4.06(b)(xix)) or (ii) amounts attributable to any Debt or Preferred Stock discharged on such determination date to the extent that such discharge results from the proceeds incurred pursuant to Section 4.06(b) (other than amounts attributable to Debt or Preferred Stock discharged on such determination date using proceeds of Debt Preferred Stock incurred pursuant to Section 4.06(b)(xix)).
If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt for a period equal to the remaining term of such Interest Rate Agreement).
“Consolidated Net Interest Expense” of any Person means, for any period, without duplication and in each case determined on a consolidated basis in accordance with IFRS, the sum of:
(a)such Person’s and its Restricted Subsidiaries’ total interest expense for such period, including, without limitation:
(i)amortization of debt discount;
(ii)the net costs of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements (including amortization of fees and discounts);
(iii)commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and similar transactions;
(iv)the interest portion of any deferred payment obligation and amortization of debt issuance costs; plus
(b)the interest component of such Person’s and its Restricted Subsidiaries’ Capitalized Lease Obligations accrued and/or scheduled to be paid or accrued during such period other than the interest component of Capitalized Lease Obligations between or among such Person and any Restricted Subsidiary thereof or between or among Restricted Subsidiaries of such Person; plus
(c)such Person’s and its Restricted Subsidiaries non‑cash interest expenses and interest that was capitalized during such period; plus
(d)the interest expense on Debt of another Person to the extent such Debt is guaranteed by such Person or any Restricted Subsidiary thereof or secured by a Lien on such Person’s or any Restricted Subsidiary thereof’s assets, but only to the extent that such interest is actually paid by such Person or such Restricted Subsidiary; minus
(e)the interest income of such Person and its Restricted Subsidiaries during such period (other than any non‑cash interest income on (i) any proceeds of the Notes loaned or advanced to a parent company of such Person or (ii) any Debt of a parent company of such Person owed to such Person or one of its Restricted Subsidiaries arising as a result of a distribution to such entity).
Notwithstanding any of the foregoing, Consolidated Net Interest Expense shall not include any of the following:
(a)interest accrued, capitalized or paid in respect of Deeply Subordinated Funding;
(b)gains, losses, expenses or charges associated with refinancing of debt;
(c)gains, losses, expenses or charges associated with the total or partial extinguishment of debt;
(d)gains, losses, expenses or charges resulting from “mark to market” provisions or fair value charges applied to or resulting from derivatives;
(e)any non‑cash pension expense; or
(f)with respect to the Issuer, interest expense on the Notes (including any Additional Notes).
“Consolidated Non‑cash Charges” of any Person means, for any period, the aggregate depreciation, amortization and other non‑cash expenses of such Person and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with IFRS (excluding any such non‑cash charge that requires an accrual of or reserve for cash charges for any future period).
“Consolidated Tax Expense” of any Person means, for any period with respect to any Relevant Taxing Jurisdiction, the provision for all national, local and foreign federal, state or other income taxes of such Person and its Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with IFRS.
“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
“Contribution Debt” means Debt of any Permitted Subsidiary in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions and any such cash contributions that have been used to make a Restricted Payment or a Permitted Investment) made to the equity (other than through the issuance of Redeemable Capital Stock) of the Issuer or in the form of Deeply Subordinated Funding, in each case, after the Issue Date; provided that (without prejudice to the rights of the Issuer and the Restricted Subsidiaries, including the right to divide and/or classify and/or reclassify as described in Section 4.06) such Contribution Debt is so designated as Contribution Debt pursuant to an Officer’s Certificate on the incurrence date thereof.
“Credit Facility” or “Credit Facilities” means one or more debt facilities, indentures or other arrangements with banks, insurance companies, other financial institutions or investors providing for revolving credit loans, term loans, notes, receivables financings, letters of credit or other forms of guarantees and assurances, or other Debt, including overdrafts, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, repaid or refinanced (and whether in whole or in part and whether or not with the original administrative agent or lenders or another administrative agent or agents or other bank or institutions and whether provided under one or more other credit or other agreements, indentures, financing agreements or otherwise) and, for the avoidance of doubt, includes any agreement extending the maturity of, refinancing or restructuring all or any portion of the indebtedness under such agreements or any successor agreements.
“Currency Agreements” means, in respect of a Person, any spot or forward foreign exchange agreements and currency swap, currency option or other similar financial agreements or arrangements designed to protect such Person against or manage exposure to fluctuations in foreign currency exchange rates.
“Custodian” means any receiver, trustee, assignee, liquidator, custodian, administrator or similar official under any Bankruptcy Law.
“Debt” means, with respect to any Person, without duplication:
(a)all liabilities of such Person for borrowed money (including overdrafts) or for the deferred purchase price of property or services, excluding any trade payables and other accrued current liabilities incurred in the ordinary course of business;
(b)all obligations of such Person evidenced by bonds, notes, debentures or other similar instruments;
(c)all obligations, contingent or otherwise, of such Person in connection with any letters of credit, bankers’ acceptances, receivables facilities or other similar facilities;
(d)all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even if the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade payables arising in the ordinary course of business;
(e)all Capitalized Lease Obligations of such Person;
(f)all obligations of such Person under or in respect of Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements; and
(g)preferred stock of a Pledged Company and all Redeemable Capital Stock of such Person valued at the greater of its voluntary maximum fixed repurchase price and involuntary maximum fixed repurchase price plus accrued and unpaid dividends;
if and to the extent the preceding items in clauses (a) to (f) would appear as debt on a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS; provided that the term “Debt” shall not include (i) non‑interest bearing installment obligations and accrued liabilities incurred in the ordinary course of business that are not more than 90 days past due; (ii) Debt in respect of the incurrence by the Issuer or any of its Restricted Subsidiaries of Debt in respect of standby letters of credit, performance bonds or surety bonds provided by the Issuer or any of its Restricted Subsidiaries in the ordinary course of business to the extent such letters of credit or bonds are not drawn upon or, if and to the extent drawn upon are honored in accordance with their terms and if, to be reimbursed, are reimbursed no later than the fifth Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit or bond; (iii) anything accounted for as an operating lease in accordance with the Election Option; (iv) any pension obligations of the Issuer or any of its Restricted Subsidiaries; (v) Debt incurred by a Permitted Subsidiary in connection with a transaction where (x) such Debt is borrowed from a bank or trust company having a combined capital and surplus and undivided profits of not less than $500 million, whose debt has a rating immediately prior to the time such transaction is entered into, of at least A or the equivalent thereof by S&P and A2 or the equivalent thereof by Moody’s and (y) a substantially concurrent Investment is made by a Permitted Subsidiary in the form of cash deposited with the lender of such Debt, or a Subsidiary or Affiliate thereof, in amount equal to such Debt; and (vi) Deeply Subordinated Funding. In addition, “Debt” of the specified Person shall include all Debt of another Person secured by a Lien on any asset of the specified Person (whether or not such Debt is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of Debt of another Person, and Preferred Stock of any Restricted Subsidiary.
For purposes of this definition, the “maximum fixed repurchase price” of any Redeemable Capital Stock that does not have a fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Redeemable Capital Stock as if such Redeemable Capital Stock were purchased on any date on which Debt will be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the Fair Market Value of such Redeemable Capital Stock, such Fair Market Value will be determined in good faith by the Board of Directors of the issuer of such Redeemable Capital Stock; provided that if such Redeemable Capital Stock is not then permitted to be redeemed, repaid or repurchased, the redemption, repayment or repurchase price shall be the book value of such Redeemable Capital Stock as reflected in the most recent financial statements of such Person.
“Deeply Subordinated Funding” means any funds provided to the Issuer pursuant to an agreement, note, security or other instrument, other than Capital Stock, that (i) is subordinated in right of payment to all Debt of the Issuer, (ii)(A) does not mature or require any amortization, redemption or other repayment of principal, (B) does not require payment of any cash interest or any similar cash amounts, and (C) contains no change of control or similar provisions and does not accelerate and has no right to declare a default or event of default or take any enforcement action or otherwise require any cash payment (other than as a result of insolvency proceedings of the Issuer), in each case prior to the 90th day following the repayment in full of the Notes and all other amounts due under this Indenture, (iii) does not provide for or require any security interest or encumbrance over any asset of the Issuer or any Restricted Subsidiary and (iv) does not contain any covenants (financial or otherwise) other than a covenant to pay such Deeply Subordinated Funding.
“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.
“Designated Non‑cash Consideration” means the Fair Market Value of non‑cash consideration received by the Issuer or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non‑cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, executed by the principal financial officer of the Issuer, less the amount of Cash Equivalents received in connection with a subsequent sale, redemption, repurchase of, or collection or payment on, such Designated Non‑cash Consideration.
“Disinterested Director” means, with respect to any transaction or series of related transactions, a member of the Issuer’s Board of Directors or one of its Subsidiaries who does not have any material direct or indirect financial interest in or with respect to such transaction or series of related transactions or is not an Affiliate, or an officer, director or employee of any Person (other than the Issuer or a Restricted Subsidiary of the Issuer) who has any direct or indirect financial interest in or with respect to such transaction or series of related transactions; provided that no member of the Issuer’s Board of Directors shall be deemed to have any such direct or indirect financial interest solely as a result of such member’s ownership of Capital Stock in, or other securities or Debt of, the Issuer or any successor, holding company, Subsidiary, associate or affiliate thereof or such member’s serving on the Board of Directors of the Issuer or any successor, holding company, Subsidiary, associate or affiliate thereof holding shares in, or other securities or Debt of, directly or indirectly, the Issuer or such members serving on the Board of Directors of any company holding shares in, or other securities or Debt of, directly or indirectly, the Issuer or any successor, holding company, Subsidiary, associate or affiliate thereof.
“DTC” means The Depository Trust Company, its nominees and successors.
“Escrow Account” means a deposit account established to hold cash and other property as required by this Indenture.
“Escrow Offer” means an offer made by the Issuer to all holders of Notes to purchase Notes at a purchase price (expressed as a percentage of their principal amount at maturity) equal to or greater than 104% (as determined by the Issuer) of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to the applicable date of purchase (including, for the avoidance of doubt, any offer made by the Issuer with respect to proceeds of a Pledge Company Share Sale prior to such amounts being deposited in the Escrow Account).
“euro” or “€” means the lawful currency of the member states of the European Union who have agreed to share a common currency in accordance with the provisions of the Maastricht Treaty dealing with European monetary union.
“Euroclear” means Euroclear SA/NV or any successor thereto.
“Euronext Dublin” means the Global Exchange Market of Irish Stock Exchange plc, trading as Euronext Dublin.
“Euro Equivalent” means, with respect to any monetary amount in a currency other than euro, at any time for the determination thereof, the amount of euro obtained by converting such foreign currency involved in such computation into euro at the spot rate for the purchase of euro with the applicable foreign currency as published under “Currency Rates” in the section of the Financial Times entitled “Currencies, Bonds & Interest Rates” on the date that is two Business Days prior to such determination.
“European Government Obligations” means direct obligations (or certificates representing an ownership interest in such obligations) of a member state of the European Union (including any agency or instrumentality thereof) for the payment of which the full faith and credit of such government is pledged.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Excluded Contribution” means Net Cash Proceeds or property or assets received by the Issuer as capital contributions (other than Contribution Debt and any contributions used to make a Restricted Payment or a Permitted Investment) to the equity (other than through the issuance of Redeemable Capital Stock) of the Issuer or in the form of Deeply Subordinated Funding, in each case of such capital contribution or Deeply Subordinated Funding, after the Issue Date or from the issuance or sale (other than to a Restricted Subsidiary or an employee stock ownership plan or trust established by the Issuer or any Subsidiary of the Issuer for the benefit of its employees to the extent funded by the Issuer or any Restricted Subsidiary) of Capital Stock (other than Redeemable Capital Stock) of the Issuer, in each case, to the extent designated as an Excluded Contribution pursuant to an Officer’s Certificate of the Issuer and, if such Excluded Contributions are non‑cash assets or property, they are promptly contributed to a Permitted Subsidiary.
“Existing Ardagh Bonds” means (i) the Existing Secured Notes and (ii) the Existing Unsecured Notes and any other international debt securities of the Issuer or any of its Restricted Subsidiaries outstanding on the Issue Date; provided that for purposes of clause (a) of the definition of “Change of Control” and Section 6.01(a)(v) and (vii), the August 2019 Secured Notes and the August 2019 Senior Notes shall be deemed to not be Existing Ardagh Bonds.
“Existing Secured Notes” means the May 2016 Secured Notes, the March 2017 Secured Notes and the August 2019 Secured Notes.
“Existing Unsecured Notes” means the May 2016 Senior Notes, the January 2017 Senior Notes, the June 2017 Senior Notes and the August 2019 Senior Notes.
“Fair Market Value” means, with respect to any asset or property, the sale value that would be obtained in an arm’s‑length free market 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 Issuer’s Board of Directors.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in section 1471(b) of the Code, or otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, or any law implementing an intergovernmental approach thereto.
“guarantees” means, as applied to any obligation,
(a)a guarantee (other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business), direct or indirect, in any manner, of any part or all of such obligation; and
(b)an agreement, direct or indirect, contingent or otherwise, the practical effect of which is to assure in any way the payment or performance (or payment of damages in the event of non‑performance) of all or any part of such obligation, including, without limiting the foregoing, by the pledge of assets and the payment of amounts drawn down under letters of credit.
“Holder” means the Person in whose name a Note is registered on the Registrar’s books.
“IFRS” means International Financial Reporting Standards (formerly International Accounting Standards) as issued by the International Accounting Standard Board (and related interpretations issued by the IASB) or any variation thereof with which the Issuer or its Restricted Subsidiaries are, or may be, required to comply, as in effect on the Issue Date or, with respect to Section 4.17 as in effect from time to time. Except as otherwise set forth in this Indenture, all ratios and calculations based on IFRS (or, as applicable, GAAP) contained in this Indenture shall be computed in accordance with IFRS as in effect on the Issue Date (or, as applicable, GAAP as in effect at the date specified by the Issuer in its election to adopt GAAP in accordance with the fourth sentence of this definition). At any time after the Issue Date, the Issuer may elect to implement any new measures or other changes to IFRS (or, as applicable, GAAP) in effect on or prior to the date of such election; provided that any such election, once made,
shall be irrevocable. At any time after the Issue Date, the Issuer may elect to apply GAAP accounting principles in lieu of IFRS and, upon any such election, references herein to IFRS shall thereafter be construed to mean GAAP (except as otherwise provided in this Indenture), including as to the ability of the Company to make an election pursuant to the previous sentence; provided that any such election, once made, shall be irrevocable; provided, further, that any calculation or determination in this Indenture that requires the application of IFRS for periods that include fiscal quarters ended prior to the Issuer selection to apply GAAP shall remain as previously calculated or determined in accordance with IFRS; provided, further again, that the Issuer may only make such election if it also elects to report any subsequent financial reports required to be made by the Issuer. The Issuer shall give notice of any such election made in accordance with this definition to the Trustee and the Holders. Notwithstanding any of the foregoing, (i) in relation to the making of any determination or calculation under this Indenture, the Issuer shall be required to elect (the “Election Option”), from time to time and each time, either (A) to apply IFRS 16 (Leases) or (B) to apply IAS 17 (Leases) (or, in each case, the equivalent measure under GAAP) to the making of such determination or calculation; provided that, if such determination or calculation involves more than one element (including for the calculation of a financial ratio), such selected accounting standard shall be consistently applied to each element of such determination or calculation (other than, for the avoidance of doubt, in relation to Section 4.17); and (ii) any adverse impact directly or indirectly relating to or resulting from the implementation of IFRS 15 (Revenue from Contracts with Customers) and any successor standard thereto (or any equivalent measure under GAAP) shall be disregarded with respect to all ratios, calculations and determinations based upon IFRS to be calculated or made, as the case may be, pursuant to this Indenture (other than, for the avoidance of doubt, in relation to Section 4.17).
“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof.
“Intercreditor Agreement” means the Intercreditor Agreement entered into on December 7, 2010, as amended and restated most recently on March 21, 2017 and from time to time among, inter alios, Ardagh Packaging Finance S.A., Ardagh Packaging Holdings Limited and Citibank, N.A., London Branch in its capacity as security agent thereunder and trustee for the Existing Secured Notes.
“Interest Payment Date” means the Stated Maturity of an installment of interest on the Notes.
“Interest Rate Agreements” means, in respect of a Person, any interest rate protection agreements and other types of interest rate hedging agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements) designed to protect such Person against or manage exposure to fluctuations in interest rates.
“Intermediate Holding Company” means a Pledged Company that is (i) a Restricted Subsidiary of the Issuer and (ii) a parent company of a Pledged Company.
“Investment” means, with respect to any Person, any direct or indirect advance, loan or other extension of credit (including guarantees) or capital contribution to (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 others), or any purchase, acquisition or ownership by such Person of any Capital Stock, bonds, notes, debentures or other securities or evidences of Debt issued or owned by, any other Person and all other items that would be classified as investments on a balance sheet prepared in accordance with IFRS. In addition, the portion (proportionate to the Issuer’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary will be deemed to be an “Investment” that the Issuer made in such Unrestricted Subsidiary at such time. The portion (proportionate to the Issuer’s equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of any Unrestricted Subsidiary at the time that such Unrestricted Subsidiary is designated a Restricted Subsidiary will be considered a reduction in outstanding Investments. “Investments” excludes extensions of trade credit on commercially reasonable terms in accordance with normal trade practices.
“IP Cross License Agreement” means the intellectual property cross license agreement entered into on October 31, 2019 between AGSA and Trivium Packaging B.V.
“Issue Date” means November 20, 2019.
“Issuer Order” means a written order signed in the name of the Issuer by any Person authorized by a resolution of the Issuer’s Board of Directors.
“January 2017 Senior Notes” means the existing $1,700,000,000 aggregate principal amount of 6.000% Senior Notes due 2025.
“Lien” means any mortgage or deed of trust, charge, pledge, lien (statutory or otherwise), privilege, security interest, hypothecation, assignment for security, standard security, assignation in security claim, or preference or priority or other encumbrance upon or with respect to any property of any kind, real or personal, movable or immovable, now owned or hereafter acquired. A Person will be deemed to own subject to a Lien any property which such Person has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement.
“March 2017 Secured Notes” means the existing $715,000,000 aggregate principal amount of 4.250% Senior Secured Notes due 2022 and the existing €750,000,000 aggregate principal amount of 2.750% Senior Secured Notes due 2024.
“Material Subsidiary” means any Restricted Subsidiary or group of Restricted Subsidiaries (taken together) that would be a “significant subsidiary” as defined in Article 1, Rule 1‑02 of Regulation S‑X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date, measured as of the last day of the most recent fiscal quarter for which financial statements are available, or for the four fiscal quarters ended most recently for which financial statements are available, as the case may be.
“Maturity” means, with respect to any indebtedness, the date on which any principal of such indebtedness becomes due and payable as therein or herein whether at the Stated Maturity with respect to such principal or by declaration of acceleration, call for redemption or purchase or otherwise.
“May 2016 Secured Notes” means the existing $500,000,000 aggregate principal amount of Senior Secured Floating Rate Notes due 2021, €440,000,000 4.125% Senior Secured Notes due 2023 and the $1,000,000,000 4.625% Senior Secured Notes due 2023.
“May 2016 Senior Notes” means the existing €750,000,000 aggregate principal amount of 6.750% Senior Notes due 2024 and the $1,650,000,000 aggregate principal amount of 7.250% Senior Notes due 2024.
“Moody’s” means Moody’s Investors Service, Inc. and its successors.
“Mutual Services Agreement” means the mutual services agreement entered into on October 31, 2019 between AGSA and Trivium Packaging B.V. in connection with the Trivium Transactions and any modification, amendment, replacement or extension or any similar agreement.
“Net Cash Proceeds” means:
(a)with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents including (x) payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Issuer or any of its Restricted Subsidiaries) and (y) any cash or Cash Equivalents received upon the sale or other disposition of any Designated Non‑cash Consideration received in any Asset Sale, net of:
(i)brokerage commissions and other fees and expenses (including, without limitation, fees and expenses of legal counsel, accountants, investment banks and other consultants) related to such Asset Sale;
(ii)provisions for all taxes paid or payable, or required to be accrued as a liability under IFRS as a result of such Asset Sale;
(iii)all distributions and other payments required to be made to any Person (other than the Issuer or any of its Restricted Subsidiaries) owning a beneficial interest in the assets subject to the Asset Sale; and
(iv)appropriate amounts required to be provided by the Issuer or any of its Restricted Subsidiaries, as the case may be, as a reserve in accordance with IFRS against any liabilities associated with such Asset Sale and retained by the Issuer or any of its Restricted Subsidiaries, 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, all as reflected in an Officer’s Certificate delivered to the Trustee; and
(b)with respect to any capital contributions, issuance or sale of Capital Stock or options, warrants or rights to purchase Capital Stock, or debt securities or Capital Stock that have been converted into or exchanged for Capital Stock as referred to in Section 4.08, the proceeds of such issuance or sale in the form of cash or Cash Equivalents, payments in respect of deferred payment obligations when received in the form of, or stock or other assets when disposed of for, cash or Cash Equivalents (except to the extent that such obligations are financed or sold with recourse to the Issuer or any of its Restricted Subsidiaries), net of attorney’s fees, accountant’s fees and brokerage, consultation, underwriting and other fees and expenses actually incurred in connection with such issuance or sale (including fees and expenses relating to any offers to purchase resulting therefrom) and net of taxes paid or payable as a result thereof.
“Offering Memorandum” means the confidential offering memorandum of the Issuer, dated November 6, 2019 relating to the Notes.
“Officer’s Certificate” means a certificate signed by an officer of the Issuer or a Surviving Entity, as the case may be, and delivered to the Trustee.
“Opinion of Counsel” means a written opinion from legal counsel. The counsel may be an employee of or counsel to the Issuer.
“Parties” means the Issuer, the Trustee, the Principal Paying Agent, the Security Agent and the Registrar and any other party from time to time hereto (each, a “Party”).
“Permitted Collateral Liens” means Liens on the Collateral:
(a)that are described in one or more of clauses (h), (i), (j), (l) and (q) of the definition of “Permitted Liens” and, in each case, arising by law or that would not materially interfere with the ability of the Security Agent to enforce the Security Interests in the Collateral; and
(b)to secure the Notes (including any Additional Notes permitted under this Indenture) and any Permitted Refinancing Debt in respect thereof.
“Permitted Debt” has the meaning given to such term under Section 4.06(b).
“Permitted Holders” means (a) Yeoman Capital S.A., (b) any of Paul Coulson, Brendan Dowling, Houghton Fry, Edward Kilty, John Riordan or Niall Wall, and any trust created for the benefit of one or more of the foregoing or their respective natural person Affiliates, or the estate, executor, administrator, committee or beneficiaries of any thereof, and (c) any of their respective Affiliates.
“Permitted Investments” means any of the following:
(a)(i) Investments in cash or Cash Equivalents; and (ii) Investments in any Restricted Subsidiary of the Issuer or any other Person if as a result of such Investment such other Person becomes a Restricted Subsidiary of the Issuer or such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, the Issuer or a Restricted Subsidiary of the Issuer;
(b)intercompany Debt to the extent permitted under clause (d) of the definition of “Permitted Debt”;
(c)expenses or advances to cover payroll, travel, entertainment, moving, other relocation and similar matters;
(d)Investments in the Notes;
(e)Investments existing at the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on, or made pursuant to a binding commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased as required by the terms of such Investment existing on the Issue Date;
(f)Investments in Commodity Hedging Agreements, Interest Rate Agreements and Currency Agreements permitted under clauses (b)(viii), (b)(ix) and (b)(x) of Section 4.06;
(g)loans and advances (or guarantees to third‑party loans) to directors, officers or employees of the Issuer or any of its Restricted Subsidiaries made in the ordinary course of business and consistent with the Issuer’s past practices or past practices of its Restricted Subsidiaries, as the case may be, in an amount outstanding not to exceed at any one time the greater of $30,000,000 and 0.5% of Total Assets;
(h)Investments in a Person to the extent that the consideration therefor consists of the issue and sale (other than to any Subsidiary) of shares of the Issuer’s Qualified Capital Stock or Deeply Subordinated Funding or the net proceeds thereof (other than any Excluded Contribution or the proceeds of any Contribution Debt);
(i)pledges or deposits with respect to leases or utilities provided to third parties in the ordinary course of business;
(j)Investments of the Issuer or its Restricted Subsidiaries described under item (v) to the proviso to the definition of “Debt”;
(k)(i) stock, obligations or securities received in satisfaction of judgments, foreclosure of liens or settlement of debts or arbitration awards, and (ii) any Investments received in compromise of obligations of such persons incurred in the ordinary course of trade creditors or customers that were incurred in the ordinary course of business, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer;
(l)any Investments received in comprise or resolution of litigation, arbitration or other disputes;
(m)any guarantee of Debt permitted to be incurred by Section 4.06, performance guarantees and contingent obligations incurred in the ordinary course of business and creation of Liens on the assets of the Issuer or any of its Restricted Subsidiaries in compliance with Section 4.07;
(n)any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with the second paragraph of Section 4.10 (except transactions described in clauses (ii), (v), (x) and (xi);
(o)advances, loans, rebates and extensions of credit (including the creation of receivables) to suppliers, customers and vendors, and advance payment made and deferred consideration and performance guarantees, in each case in the ordinary course of business; and
(p)any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business.
“Permitted Joint Venture” means any joint venture or similar combinations or other transaction pursuant to which the Issuer or any of its Restricted Subsidiaries enters into, acquires or subscribes for any shares, stock, securities or other interest in or transfers any assets to any joint venture; provided, however, that the primary business of such joint venture is a Similar Business.
“Permitted Liens” means the following types of Liens:
(a)Liens existing as of the Issue Date;
(b)[intentionally omitted];
(c)Liens on assets given, disposed of or otherwise transferred in connection with a Permitted Receivables Financing permitted to be incurred pursuant to clause (b)(xiii) of Section 4.06;
(d)[intentionally omitted];
(e)[intentionally omitted];
(f)any interest or title of a lessor under any Capitalized Lease Obligation and Liens to secure Debt (including Capitalized Lease Obligations) permitted under Section 4.06 covering only the assets acquired with such Debt;
(g)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by the Issuer or any of its Restricted Subsidiaries in the ordinary course of business;
(h)statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, material men, repairmen, employees, pension plan administrators or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings or Liens arising solely by virtue of any statutory or common law provisions relating to attorney’s liens or bankers’ liens, rights of set‑off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depositary institution;
(i)Liens for taxes, assessments, government charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings for which a reserve or other appropriate provision, if any, as shall be required in conformity with IFRS shall have been made;
(j)Liens incurred or deposits made to secure the performance of tenders, bids or trade or government contracts, or to secure leases, statutory or regulatory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business (other than obligations for the payment of money);
(k)zoning restrictions, easements, licenses, reservations, title defects, rights of others for rights‑of‑way, utilities, sewers, electrical lines, telephone lines, telegraph wires, restrictions, encroachments and other similar charges, encumbrances or title defects and incurred in the ordinary course of business that do not in the aggregate materially interfere with in any material respect the ordinary conduct of the business of the Issuer and its Restricted Subsidiaries on the properties subject thereto, taken as a whole;
(l)Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
(m)Liens on property existing at the time such property is acquired or on property of, or on shares of Capital Stock or Debt of, any Person existing at the time such Person is acquired by, merged with or into or consolidated with, any Restricted Subsidiary of the Issuer; provided that such Liens (i) do not extend to or cover any property or assets of (A) the Issuer or (B) any Restricted Subsidiary of the Issuer other than, in the case of clause (B), (x) the property or assets acquired or (y) the property or assets of the Person acquired, merged with or into or consolidated with any Restricted Subsidiary of the Issuer and (ii) were created prior to, and not in connection with or in contemplation of such acquisition, merger or consolidation;
(n)Liens securing the Issuer’s or any Restricted Subsidiary’s (other than a Permitted Subsidiary’s) obligations under Interest Rate Agreements or Currency Agreements permitted under clauses (b)(viii), (b)(ix) and (b)(x) of Section 4.06 or any collateral for the Debt to which such Commodity Hedging Agreements, Interest Rate Agreements or Currency Agreements relate;
(o)Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or other insurance (including unemployment insurance) or deposits to secure public or statutory obligations of such Person or deposits of cash or government bonds to secure performance, bid, surety or appeal bonds and completion bonds and guarantees to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;
(p)Liens incurred in connection with a cash management program established in the ordinary course of business;
(q)Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Issuer or any of its Restricted Subsidiaries, including rights of offset and set‑off;
(r)any extension, renewal or replacement, in whole or in part, of any Lien; provided that any such extension, renewal or replacement shall not extend in any material respect to any additional property or assets;
(s)Liens securing Debt incurred to refinance Permitted Refinancing Debt permitted to be incurred under this Indenture; provided that any such Lien shall not extend to or cover materially any assets not securing the Debt so refinanced plus improvements and accessions to such property and assets and proceeds and distributions thereof;
(t)purchase money Liens to finance property or assets of any Permitted Subsidiary acquired in the ordinary course of business; provided that the related purchase money Debt shall not exceed the cost of such property or assets and shall not be secured by any property or assets of the Issuer or any of its Restricted Subsidiaries other than the property and assets so acquired;
(u)Permitted Collateral Liens;
(v)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;
(w)[intentionally omitted];
(x)[intentionally omitted];
(y)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created in the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(z)leases, licenses, subleases and sublicenses of assets in the ordinary course of business;
(aa)Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third‑party relating to such property or assets;
(bb)Liens on equipment of the Issuer or any Restricted Subsidiary granted in the ordinary course of business; and
(cc)customary Liens on and in respect of deposits required in connection with the purchase of property, equipment and inventory, in each case incurred in the ordinary course of business.
“Permitted Receivables Financing” means any financing pursuant to which any Permitted Subsidiary may sell, convey or otherwise transfer to any other Person or grant a security interest in, any accounts receivable (and related assets) in an aggregate principal amount equivalent to the Fair Market Value of such accounts receivable (and related assets) of any Permitted Subsidiary; provided that (a) the covenants, events of default and other provisions applicable to such financing shall be customary for such transactions and shall be on market terms (as determined in good faith by the Issuer’s Board of Directors) at the time such financing is entered into, (b) the interest rate applicable to such financing shall be a market interest rate (as determined in good faith by the Issuer’s Board of Directors) at the time such financing is entered into and (c) such financing shall be non‑recourse to the Issuer or any of its Restricted Subsidiaries except to a limited extent customary for such transactions.
“Permitted Refinancing Debt” means any renewals, extensions, substitutions, refinancings or replacements (each, for purposes of this definition and clause (b)(xiv) of Section 4.06, a “refinancing”) of any Debt of the Issuer or any of its Restricted Subsidiaries or pursuant to this definition, including any successive refinancings, so long as:
(a)such Debt is in an aggregate principal amount (or if incurred with original issue discount, an aggregate issue price) not in excess of the sum of (i) the aggregate principal amount (or if incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being refinanced and (ii) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, related to such refinancing;
(b)the Average Life of such Debt is equal to or greater than the Average Life of the Debt being refinanced;
(c)the Stated Maturity of such Debt is no earlier than the Stated Maturity of the Debt being refinanced; and
(d)the new Debt is an obligation of one or more Permitted Subsidiaries;
provided that Permitted Refinancing Debt will not include Debt of any Restricted Subsidiary of the Issuer that refinances Debt of an Unrestricted Subsidiary.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, winding up or corporate reconstruction, directly or indirectly, in one or a series of related transactions involving the Issuer or any of its Restricted Subsidiaries (a “Reorganization”) that is made on a solvent basis; provided that (a) any payments or assets distributed in connection with such Reorganization remain within the Issuer and its Restricted Subsidiaries; and (b) if any shares or other assets form part of the Collateral,
substantially equivalent Liens must be granted over such shares or assets of the recipient such that they form part of the Collateral. For the avoidance of doubt, the term “Permitted Reorganization” shall include the closure of bank accounts and the conversion of debt instruments into Capital Stock or other equity instruments.
“Permitted Subsidiary” means (i) AGSA and (ii) any Restricted Subsidiary of a Pledged Company; provided that any Intermediate Holding Company shall not be a Permitted Subsidiary.
“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint‑stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“Pledged Company” means (i) AGSA, (ii) any Person formed by or surviving any consolidation or merger with AGSA or to which all or substantially all the properties and assets of AGSA and its Restricted Subsidiaries on a consolidated basis are sold, assigned, conveyed, transferred, leased or otherwise disposed, (iii) ARD Group Finance Holdings S.A., (iv) any other Person with respect to whom the Issuer has granted a Lien on the Qualified Capital Stock of such Person in favor of the Security Agent on behalf of the Holders pursuant to Section 4.19(b) and (v) in each case, any successor of any of the foregoing.
“Preferred Stock” means, with respect to any Person, Capital Stock of any class or classes (however designated) of such Person which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over the Capital Stock of any other class of such Person whether now outstanding, or issued after the Issue Date, and including, without limitation, all classes and series of preferred or preference stock of such Person.
“pro forma” means, with respect to any calculation made or required to be made pursuant to the terms of this Indenture, a calculation made in good faith by a responsible financial or accounting officer of the Issuer; provided that any such calculation shall (x) give effect to any realized or expected synergies, cost efficiencies and cost savings relating to, or directly or indirectly resulting from, or associated with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative that has occurred during the period included in the calculation or any prior period or would reasonably be expected to occur in connection with an acquisition or other transaction in relation to which “pro forma” effect is given, as if such synergies, cost efficiencies or cost savings had been effective throughout the period included in the calculation and (y) eliminate any extraordinary, exceptional, unusual or nonrecurring loss, expense or charge (including severance, relocation, plant closure, operational improvement or restructuring costs or reserves therefor) relating to, or directly or indirectly resulting from, or incurred in connection with, any Asset Sale, Investment, acquisition, reorganization, restructuring or operational improvement initiative, or offering of debt or equity securities.
“Property” means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock, and other securities of, any other Person. For purposes of any calculation required pursuant to this Indenture, the value of any Property shall be its Fair Market Value.
“QIB” means a “Qualified Institutional Buyer” as defined in Rule 144A.
“Qualified Capital Stock” of any Person means any and all Capital Stock of such Person other than Redeemable Capital Stock.
“Record Date” for the interest payable on any Interest Payment Date means the Business Day immediately preceding such Interest Payment Date.
“Redeemable Capital Stock” means any class or series of Capital Stock that, either by its terms, by the terms of any security into which it is convertible or exchangeable or by contract or otherwise, is, or upon the happening of an event or passage of time would be, required to be redeemed prior to the final Stated Maturity of the Notes or is redeemable at the option of the holder thereof at any time prior to such final Stated Maturity (other than upon a change of control of the Issuer in circumstances in which the Holders would have similar rights), or is
convertible into or exchangeable for debt securities at any time prior to such final Stated Maturity; provided that any Capital Stock that would constitute Qualified Capital Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of any “asset sale” or “change of control” occurring prior to the Stated Maturity of the Notes will not constitute Redeemable Capital Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Section 4.09 and Section 4.11 and such Capital Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Issuer’s repurchase of such Notes as are required to be repurchased pursuant to Section 4.09 and Section 4.11.
“Redemption Date” means, when used with respect to any Note to be redeemed, in whole or in part, the date fixed for such redemption by or pursuant to this Indenture.
“Redemption Price” means, when used with respect to any Note to be redeemed, the price at which it is to be redeemed pursuant to this Indenture.
“Regulation S” means Regulation S under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Replacement Assets” means properties and assets that replace the properties and assets that were the subject of an Asset Sale or properties and assets that are, or will be, used in the Issuer’s business or in that of the Restricted Subsidiaries of the Issuer or in a Similar Business or any and all businesses that in the good faith judgment of the Board of Directors of the Issuer are reasonably related, and, in each case, any capital expenditure relating thereto.
“Restricted Subsidiary” of a Person means any Subsidiary of such Person other than an Unrestricted Subsidiary.
“Rule 144” means Rule 144 under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“Rule 144A” means Rule 144A under the Securities Act (including any successor regulation thereto), as it may be amended from time to time.
“S&P” means Standard and Poor’s Ratings Service, a division of The McGraw‑Hill Companies, Inc. and its successors.
“Securities Act” means the U.S. Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.
“Security Agent” means Citibank, N.A., London Branch, and its successors, as security agent under the Security Documents, and any additional security agent or sub-agent.
“Security Documents” means, collectively, all security agreements, mortgages, standard securities, deeds of trust, pledges, collateral assignments and other agreements or instruments evidencing or creating any security entered into by the Issuer or any of its Subsidiaries pursuant to Section 11.01 of this Indenture in favor of the Security Agent or any holders in any or all of the Collateral, as amended from time to time in accordance with their terms and the terms of this Indenture.
“Security Interests” means security interests in the Collateral securing the Notes.
“Senior Debt” means all Debt of the Issuer or its Permitted Subsidiaries permitted to be incurred under Section 4.06 hereof and all obligations with respect thereto to the extent such debt is not contractually subordinated to the Notes. Notwithstanding anything to the contrary in the preceding sentence, Senior Debt shall not include:
(a)any liability for taxes owed or owing by the Issuer or any Restricted Subsidiary that is not a Permitted Subsidiary;
(b)any Debt that is incurred in violation of this Indenture; or
(c)any trade payables.
“Shareholders Agreement” means the shareholders agreement dated October 31, 2019 among Element Holdings II L.P., AGSA and Trivium Packaging B.V. and any modification, amendment, replacement or extension or any similar agreement.
“Similar Business” means any business, service or other activity engaged in by the Issuer or any Restricted Subsidiaries of the Issuer on the Issue Date and any business, service or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which the Issuer and the Restricted Subsidiaries are engaged on the Issue Date (including the businesses engaged in by Trivium Packaging B.V. and its Subsidiaries) or any business that, in the good faith business judgment of the Issuer, constitutes a reasonable diversification of business conducted by the Issuer and its Subsidiaries.
“Stated Maturity” means, when used with respect to any note or any installment of interest thereon, the date specified in such note as the fixed date on which the principal of such note or such installment of interest, respectively, is due and payable, and, when used with respect to any other indebtedness, means the date specified in the instrument governing such indebtedness as the fixed date on which the principal of such indebtedness, or any installment of interest thereon, is due and payable.
“Subsidiary” means, with respect to any Person:
(a)a corporation a majority of whose Voting Stock is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof; and
(b)any other Person (other than a corporation), including, without limitation, a partnership, limited liability company, business trust or joint venture, in which such Person, one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other Person performing similar functions).
“TARGET Day” means a day on which the Trans‑European Automated Real‑time Gross Settlement Express Transfer system is operating.
“Total Assets” means the consolidated total assets of the Issuer and its Restricted Subsidiaries as shown on the most recent consolidated balance sheet delivered in accordance with Section 4.17.
“Total Inventories” means, as of any date, the amount of raw materials, packaging materials, work‑in‑progress and finished goods of the Issuer and its Restricted Subsidiaries, net of any provisions in respect of the foregoing items, in each case, as of the date of the most recent balance sheet delivered in accordance with Section 4.17.
“Total Receivables” means, as of any date, (a) the amount of accounts receivable of the Issuer and its Restricted Subsidiaries plus (b) the amount of accounts receivable of the Issuer and its Restricted Subsidiaries that has been sold, conveyed or otherwise transferred in Permitted Receivables Financings and is outstanding, in each case, as of the date of the most recent balance sheet delivered in accordance with Section 4.17.
“Treasury Rate” means, as of any redemption date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the redemption date) of the yield to maturity of United States Treasury securities with a
constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 redemption date to November 15, 2022; provided, however, that if the period from the redemption date to November 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the redemption date to November 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
“Trivium Transaction Agreement” means the transaction agreement dated July 14, 2019, among AGSA, Element Holdings II L.P. and Trivium Packaging B.V. as described in the Offering Memorandum.
“Trivium Transactions” has the meaning given to such term in the Offering Memorandum.
“Trust Officer” means any officer within the agency and corporate trust group, division or section of the Trustee (however named, or any successor group of the Trustee) and also means, with respect to any particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“Unrestricted Subsidiary” of a Person means:
(a)any Subsidiary of such Person that at the time of determination is an Unrestricted Subsidiary (as designated by the Issuer’s Board of Directors pursuant to Section 4.15);
(b)any Subsidiary of an Unrestricted Subsidiary; and
(c)Enville Limited, UniMould S.A., Ardagh Packaging Finance UK Limited, Recan GmbH, Impress Metal Packaging (Trustee) Limited and Recan UK Limited.
“U.S. dollars” or “$” means the lawful currency of the United States of America.
“U.S. Dollar Equivalent” means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for the determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as quoted by Reuters at approximately 10:00 A.M. (New York City time) on such date of determination (or if no such quote is available on such date, on the immediately preceding Business Day for which such a quote is available).
“U.S. Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America, and the payment for which the United States pledges its full faith and credit.
“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors, managers or trustees (or Persons performing similar functions) of any Person (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency).
“Wholly Owned Restricted Subsidiary” of a Person means any Restricted Subsidiary of such Person, all of the outstanding Capital Stock (other than directors’ qualifying shares or shares of Restricted Subsidiaries required to be owned by third parties pursuant to applicable law) of which are owned by such Person or by one or more other Wholly Owned Restricted Subsidiaries of such Person or by such Person and one or more other Wholly Owned Restricted Subsidiaries.
Term |
|
Defined in Section |
“Additional Amounts” |
|
4.12(a) |
“Additional Dollar Notes” |
|
Recitals |
“Additional Euro Notes” |
|
Recitals |
“Additional Notes” |
|
Recitals |
“Agents” |
|
2.03 |
“Applicable Procedures” |
|
2.06(b)(ii) |
“Annual Distributable Amount” |
|
4.08(b)(xv)(ii)(B) |
“Authorized Agent” |
|
12.08 |
“Change of Control Offer” |
|
4.11(a) |
“Change of Control Purchase Date” |
|
4.11(a) |
“Change of Control Purchase Price” |
|
4.11(a) |
“covenant defeasance” |
|
8.03 |
“Defaulted Interest” |
|
2.12 |
“Dollar Notes” |
|
Recitals |
“Dollar PIK Interest Notes” |
|
2.01(d) |
“Euro Notes” |
|
Recitals |
“Euro PIK Interest Notes” |
|
2.01(d) |
“Event of Default” |
|
6.01(a) |
“Global Notes” |
|
2.01(c) |
“incur” |
|
4.06(a) |
“incurrence” |
|
4.06(a) |
“Issuer” |
|
Preamble |
“legal defeasance” |
|
8.02 |
“Notes” |
|
Recitals |
“Operating Group Excess Proceeds” |
|
4.09(b) |
“Original Dollar Notes” |
|
Recitals |
“Original Euro Notes” |
|
Recitals |
Term |
|
Defined in Section |
“Original Notes” |
|
Recitals |
“Parallel Debt” |
|
11.05 |
“Participants” |
|
2.01(c) |
“Paying Agent” |
|
2.03 |
“Permitted Debt” |
|
4.06(b) |
“PIK Interest” |
|
2.01(d) |
“PIK Interest Notes” |
|
2.01(d) |
“PIK Payment” |
|
Exhibit A |
“Principal Paying Agent” |
|
Preamble |
“Registrar” |
|
2.03 |
“Regulation S Dollar Global Note” |
|
2.01(b) |
“Regulation S Euro Global Note” |
|
2.01(b) |
“Regulation S Global Note” |
|
2.01(b) |
“Relevant Taxing Jurisdiction” |
|
4.12(a) |
“Required Currency” |
|
12.14 |
“Restricted Dollar Global Note” |
|
2.01(b) |
“Restricted Euro Global Note” |
|
2.01(b) |
“Restricted Global Notes” |
|
2.01(b) |
“Restricted Payment” |
|
4.08(a) |
“Security Agent” |
|
Preamble |
“Security Confirmations” |
|
4.19 |
“Security Register” |
|
2.03 |
“Supplemental Security Agent” |
|
7.08(b) |
“Surviving Entity” |
|
5.01(b)(i) |
“Taxes” |
|
4.12(a) |
“Transfer Agent” |
|
2.03 |
“Trustee” |
|
Preamble |
. Unless the context otherwise requires:
|
(i) a term has the meaning assigned to it; |
|
(ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS; |
|
(iii) “or” is not exclusive; |
|
(iv) “including” or “include” means including or include without limitation; |
|
(v) words in the singular include the plural and words in the plural include the singular; |
|
(vi) unsecured or unguaranteed Debt shall not be deemed to be subordinate or junior to secured or guaranteed Debt merely by virtue of its nature as unsecured or unguaranteed Debt; |
|
(vii) references to Notes include any increase in the principal amount of outstanding Notes (including the issuance of PIK Interest Notes) as a result of a PIK Payment; |
|
(viii) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, clause or other subdivision; and |
|
(ix) In this Agreement, where it relates to a Luxembourg entity, a reference to: |
|
(A) a winding‑up, dissolution or administration includes a Luxembourg entity: |
|
i. being declared bankrupt (faillite déclarée); |
|
ii. being subject to judicial liquidation (liquidation judiciaire); and |
|
(B) a moratorium includes a reprieve from payment (sursis de paiement) or a cocordat préventif de faillite. |
|
(C) a trustee in bankruptcy includes a curateur; |
|
(D) an administrator includes a commissaire or a juge délégué; and |
|
(E) a receiver or an administrative receiver does not include a juge commissaire or a curateur; |
|
(F) an attachment includes a saisie; |
|
(G) By law or constitutional documents includes consolidated text of articles of association (statuts); and |
|
(H) officer or director includes administrateur. |
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(i) Unless otherwise specified, all cross-references contained herein are to this Indenture. |
the terms of this Indenture or (y) commits to an acquisition or transaction pursuant to which it may incur Acquired Debt or (z) is subject to a Change of Control, the date of determination of Consolidated Adjusted Net Income or the Consolidated Fixed Charge Coverage Ratio, as applicable, shall, at the option of the Issuer, be (a) the date that a definitive agreement, put option or similar arrangement for such acquisition, transaction, merger, amalgamation, consolidation or Change of Control is entered into and the Consolidated Adjusted Net Income or the Consolidated Fixed Charge Coverage Ratio, as applicable, shall be calculated giving pro forma effect to such acquisition, Change of Control and the other transactions to be entered into in connection therewith (including any incurrence of Debt and the use of proceeds thereof) consistent with the definitions of “Consolidated Adjusted Net Income,” “Consolidated Fixed Charge Coverage Ratio” and “pro forma,” as applicable, and, for the avoidance of doubt, (A) if any such ratios are exceeded as a result of fluctuations in such ratio (including due to fluctuations in the Consolidated Adjusted Net Income of the Issuer or the target company) at or prior to the consummation of the relevant acquisition or Change of Control, such ratios will not be deemed to have been exceeded as a result of such fluctuations solely for purposes of determining whether such acquisition and any related transactions are permitted hereunder and (B) such ratios shall not be tested at the time of consummation of such acquisition, transaction, merger, amalgamation or consolidation; provided that if the Issuer elects to have such determinations occur at the time of entry into such definitive agreement, put option or similar arrangement, (i) any such transaction shall be deemed to have occurred on the date the definitive agreement, put option or similar arrangement is entered into and to be outstanding thereafter for purposes of calculating any ratios under this Indenture after the date of such agreement and before the earlier of the date of consummation of such acquisition or the date such agreement is terminated or expires without consummation of such acquisition and (ii) to the extent any covenant baskets were utilized in satisfying any covenants, such baskets shall be deemed utilized until the earlier of the date of consummation of such acquisition or the date such agreement is terminated or expires without consummation of such acquisition, but any calculation of Consolidated Adjusted Net Income for purposes of other incurrences of Debt or Liens or making of Restricted Payments (not related to such acquisition) shall not reflect such acquisition until it has been consummated unless such other incurrence of Debt or Liens is conditional or contingent on the occurrence of such acquisition or Change of Control or (b) the date such Debt is borrowed or assumed or such Change of Control occurs. |
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(a) Form and Dating. The Dollar Notes and the Trustee’s (or the authenticating agent’s) certificate of authentication shall be substantially in the form of Exhibit A-1 hereto with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture. The Euro Notes and the Trustee’s (or the authenticating agent’s) certificate of authentication shall be substantially in the form of Exhibit A-2 hereto with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture. |
The Notes may have notations, legends or endorsements required by law, the rules of any securities exchange agreements to which the Issuer is subject, if any, or usage; provided that any such notation, legend or endorsement is in form reasonably acceptable to the Issuer. The Issuer shall approve the form of the Notes. Each Note shall be dated the date of its authentication. The terms and provisions contained in the form of the Notes shall constitute and are hereby expressly made a part of this Indenture. The Dollar Notes will be issued only in fully registered form without coupons and only in minimum denominations of $1 and in integral multiples of $1 and may be transferred only in amounts of $200,000 or greater. The Euro Notes will be issued on the Issue Date only in fully registered form without coupons and only in minimum denominations of €1 and in integral multiples of €1 and may be transferred only in amounts of €100,000 or greater. Additional Notes issued from time to time in payment of PIK Interest or Additional Amounts may be issued in minimum denominations of $1 or €1, respectively.
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(b) Global Notes. Dollar Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-1 hereto, with such applicable legends as are provided in Exhibit A-1 hereto, except as otherwise permitted herein (the “Restricted Dollar Global Note”), which shall be deposited on behalf of the purchasers of the Dollar Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuer and |
authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Dollar Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Dollar Global Note and recorded in the Security Register, as hereinafter provided. |
Dollar Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-1 hereto, with such applicable legends as are provided in Exhibit A-1 hereto, except as otherwise permitted herein (the “Regulation S Dollar Global Note”), which shall be deposited on behalf of the purchasers of the Dollar Notes represented thereby with a custodian for DTC, and registered in the name of DTC or its nominee, duly executed by the Issuer and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Regulation S Dollar Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Regulation S Dollar Global Note and recorded in the Security Register, as hereinafter provided.
Euro Notes offered and sold to QIBs in reliance on Rule 144A shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-2 hereto, with such applicable legends as are provided in Exhibit A-2 hereto, except as otherwise permitted herein (the “Restricted Euro Global Note” and, together with the Restricted Dollar Global Notes, the “Restricted Global Notes”), which shall be deposited on behalf of the purchasers of the Euro Notes represented thereby with the Common Depositary, and registered in the name of the Common Depositary or its nominee, as the case may be, for the accounts of Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Restricted Euro Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Restricted Euro Global Note and recorded in the Security Register, as hereinafter provided.
Euro Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes substantially in the form of Exhibit A-2 hereto, with such applicable legends as are provided in Exhibit A-2 hereto, except as otherwise permitted herein (the “Regulation S Euro Global Note” and together with the Regulation S Dollar Global Notes, the “Regulation S Global Notes”), which shall be deposited on behalf of the purchasers of the Euro Notes represented thereby with the Common Depositary, and registered in the name of the Common Depositary or its nominee, as the case may be, for the accounts of Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee (or its agent in accordance with Section 2.02) as hereinafter provided. The aggregate principal amount of the Regulation S Euro Global Note may from time to time be increased or decreased by adjustments made by the Registrar on Schedule A to the Regulation S Euro Global Note and recorded in the Security Register, as hereinafter provided.
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(c) Book-Entry Provisions. This Section 2.01(c) shall apply to the Regulation S Global Notes and the Restricted Global Notes (together, the “Global Notes”) deposited with or on behalf of the Common Depositary and DTC. |
Members of, or participants and account holders in, DTC, Euroclear and Clearstream (“Participants”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by DTC, the Common Depositary or by the Trustee or any custodian of DTC, the Common Depositary or under such Global Note, and DTC, the Common Depositary or their respective nominees may be treated by the Issuer, the Trustee and any agent of the Issuer or the Trustee as the sole owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or the Common Depositary or impair, as between DTC or the Common Depositary, on the one hand, and the Participants, on the other, the operation of customary practices of such persons governing the exercise of the rights of a Holder of a beneficial interest in any Global Note.
Subject to the provisions of Section 2.10(b), the registered Holder of a Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action that a Holder is entitled to take under this Indenture or the Notes.
Except as provided in Section 2.10, owners of a beneficial interest in Global Notes will not be entitled to receive physical delivery of certificated Notes.
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(d) Payment Through The Issuance of Additional Notes. The Issuer may elect to pay interest (any such interest paid in accordance with the terms of this clause 2.01(d), “PIK Interest”), Additional Amounts, if any, in respect of any Notes through, in the case of the Dollar Notes, the issuance of Additional Dollar Notes and, in the case of the Euro Notes, through the issuance of Additional Euro Notes, in both cases in accordance with the terms and provisions of this Indenture and the Notes. Additional Dollar Notes issued in payment of PIK Interest (“Dollar PIK Interest Notes,” in the case of the Dollar Notes, and “Euro PIK Interest Notes, in the case of the Euro Notes and, together, “PIK Interest Notes”) and Additional Notes issued in payment of Additional Amounts shall be issued in the form of Global Notes of the same series of Global Notes on which the payment is being made. |
. An authorized member of the Issuer’s Board of Directors or an authorized signatory of the Issuer shall sign the Notes on behalf of the Issuer by manual or facsimile signature.
If an authorized member of the Issuer’s Board of Directors or an executive officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.
A Note shall not be valid or obligatory for any purpose until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Issuer shall execute and, upon receipt of an Issuer Order, the Trustee shall authenticate (whether itself or via the authenticating agent) (a) Original Dollar Notes, on the date hereof, for original issue up to an aggregate principal amount of $1,130,000,000, (b) Original Euro Notes, on the date hereof, for original issue up to an aggregate principal amount of €1,000,000,000 and (c) Additional Notes.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuer to authenticate the Notes. Unless limited by the terms of such appointment, any such authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by any such agent. An authenticating agent has the same rights as any Registrar, co-Registrar, Transfer Agent or Paying Agent to deal with the Issuer or an Affiliate of the Issuer.
The Trustee shall have the right to decline to authenticate and deliver any Notes under this Section 2.02 if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability to existing Holders.
If a Note is represented by a Global Note, the Issuer Order in respect of any Additional Notes issued to pay interest, Additional Amounts, if any, on such Note in accordance with Section 2.01(d) may provide that such Additional Notes may be evidenced by an increase of the aggregate principal amount of the Global Note represent such Note.
. The Issuer shall maintain an office or agency for the registration of the Notes and of their transfer or exchange (the “Registrar”), an office or agency where Notes may be transferred or exchanged (the “Transfer Agent”), an office or agency where the Notes may be presented for payment (the “Paying Agent” and references to the Paying Agent shall include the Principal Paying Agent) and an office or agency where notices or demands to or upon the Issuer in respect of the Notes may be served. The Issuer may appoint one or more Transfer Agents, one or more co-Registrars and one or more additional Paying Agents.
The Issuer shall maintain a Transfer Agent and Principal Paying Agent in London, England. The Issuer or any of its Affiliates may act as Transfer Agent, Registrar, co-Registrar, Paying Agent and agent for service of notices and demands in connection with the Notes; provided that neither the Issuer nor any of its Affiliates shall act as Paying Agent for the purposes of Articles Three and Eight and Sections 4.09 and 4.11.
The Issuer hereby appoints Citibank, N.A., London Branch located at Citigroup Centre, 25 Canada Square, London E14 5LB, England as Transfer Agent, as Principal Paying Agent in London, England, and as agent for service of notices and demands in connection with the Notes and (iii) Citigroup Global Markets Europe AG, at 5th Floor Reuterweg 16, 60323 Frankfurt, Germany, as Registrar.
Each hereby accepts such appointments. The Transfer Agent, the Principal Paying Agent and the Registrar and any authenticating agent are collectively referred to in this Indenture as the “Agents.” The roles, duties and functions of the Agents are of a mechanical nature and each Agent shall only perform those acts and duties as specifically set out in this Indenture and no other acts, covenants, obligations or duties shall be implied or read into this Indenture against any of the Agents. For the avoidance of doubt, a Paying Agent’s obligation to disburse any funds shall be subject to prior receipt by it of those funds to be disbursed.
Subject to any applicable laws and regulations, the Issuer shall cause the Registrar to keep a register (the “Security Register”) at its corporate trust office in which, subject to such reasonable regulations it may prescribe, the Issuer shall provide for the registration of ownership, exchange, and transfer of the Notes. Such registration in the Security Register shall be conclusive evidence of the ownership of Notes. Included in the books and records for the Notes shall be notations as to whether such Notes have been paid, exchanged or transferred, canceled, lost, stolen, mutilated or destroyed and whether such Notes have been replaced. In the case of the replacement of any of the Notes, the Registrar shall keep a record of the Note so replaced and the Note issued in replacement thereof. In the case of the cancellation of any of the Notes, the Registrar shall keep a record of the Note so canceled and the date on which such Note was canceled.
The Issuer shall enter into an appropriate agency agreement with any Paying Agent or co-Registrar not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuer shall notify the Trustee of the name and address of any such agent. If the Issuer fails to maintain a Registrar or Paying Agent, the Trustee may appoint a suitably qualified and reputable party to act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.05.
Upon written request from the Issuer, the Registrar shall provide the Issuer with a copy of the Security Register held by the Registrar to enable the Issuer to maintain a register in its own registered office in Luxembourg (to the extent required by law and subject to the provisions of this Indenture). The Issuer accepts any copy of the Security Register held by the Registrar as correspondence and document recording the transfer of Notes for the purpose of article 40 of the Luxembourg law on commercial companies, dated August 10, 1915, as amended, and agrees to update its register upon receipt of such copy.
. Not later than 12:00 p.m. London, England time, one Business Day prior to each due date of the principal, premium, if any, and interest on any Notes, the Issuer shall deposit with the Principal Paying Agent money in immediately available funds in euro or dollars, as applicable, sufficient to pay such principal, premium, if any, and interest so becoming due on the due date for payment under the Notes; provided that if the Issuer has elected to pay interest, Additional Amounts, if any, through the issuance of Additional Notes in accordance with Section 2.01(d), the Issuer may issue on such Date, and each Person then entitled to payment of interest or Additional Amounts) shall accept, an Additional Note in a principal amount, and in a currency, equal to such amount (in increments of $1 (in the case of Dollar Notes) or €1 (in the case of Euro Notes) rounded up or down to the closest full U.S. dollar or euro amount (as applicable)), and such Additional Note shall be registered in the name of the Holder of the Note with respect to which it is issued or its nominee. The Principal Paying Agent (and, if applicable, each other Paying Agent) shall remit such payment in a timely manner to the Holders on the relevant due date for payment, it being acknowledged by each Holder that if the Issuer deposits such money with the Principal Paying Agent after the time specified in the immediately preceding sentence, the Principal Paying Agent shall remit such money to the Holders on the relevant due date for payment, unless such remittance is impracticable having regard to applicable banking procedures and timing constraints, in which case the Principal Paying Agent shall remit such money to the Holders on the next Business Day, but without liability for any interest resulting from such late payment. For the avoidance of doubt, the Principal Paying Agent shall only be obliged to remit money to Holders if it has actually received such money from the Issuer. The Issuer shall require each Paying Agent other than the Trustee (including where acting as the Principal Paying Agent) to agree in writing that such Paying Agent shall hold in trust for the benefit of the Trustee all money held by the Paying Agent for the payment of principal of, premium, if any, and interest on the Notes (whether such money has been paid to it by the Issuer or any
other obligor on the Notes), and such Paying Agent shall promptly notify the Trustee of any default by the Issuer (or any other obligor on the Notes) in making any such payment. The Issuer at any time may require a Paying Agent to pay all money held by it to the Trustee and account for any funds disbursed, and the Trustee may at any time during the continuance of any payment default, upon written request to a Paying Agent, require such Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed. Upon doing so, the Paying Agent shall have no further liability for the money so paid over to the Trustee. If the Issuer or any Affiliate of the Issuer acts as Paying Agent, it shall, on or before each due date of any principal, premium, if any, or interest on the Notes, segregate and hold in a separate trust fund for the benefit of the Holders a sum of money sufficient to pay such principal, premium, if any, or interest so becoming due until such sum of money shall be paid to such Holders or otherwise disposed of as provided in this Indenture and shall promptly notify the Trustee of its action or failure to act.
The Trustee may, if the Issuer has notified it in writing that the Issuer intends to effect a defeasance or to satisfy and discharge this Indenture in accordance with the provisions of Article Eight, notify the Paying Agent in writing of this fact and require the Paying Agent (until notified by the Trustee to the contrary), to act thereafter as Paying Agent of the Trustee and not the Issuer in relation to any amounts deposited with it in accordance with the provisions of Article Eight.
. The Registrar shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders. If the Trustee is not the Registrar, the Issuer shall furnish to the Trustee, in writing no later than the Record Date for each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such Record Date as the Trustee may reasonably require of the names and addresses of Holders, including the aggregate principal amount of Notes held by each Holder.
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(a) Where Notes are presented to the Registrar or a co-Registrar with a request to register a transfer or to exchange them for an equal principal amount of Notes of other denominations, the Registrar shall register the transfer or make the exchange in accordance with the requirements of this Section 2.06. To permit registration of transfers and exchanges, the Issuer shall execute and the Trustee (or the authenticating agent) shall, upon receipt of an Issuer Order, authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes, of any authorized denominations and of a like aggregate principal amount, at the Registrar’s request; provided that no Note of less than $200,000 (in the case of Dollar Notes) or €100,000 (in the case of Euro Notes) may be transferred or exchanged. No service charge shall be made for any registration of transfer, exchange or redemption of Notes (except as otherwise expressly permitted herein), but the Issuer may require payment of a sum sufficient to cover any agency fee or similar charge payable in connection with any such registration of a transfer or exchange of Notes (other than any agency fee or similar charge payable in connection with any redemption of the Notes or upon exchanges pursuant to Sections 2.10, 3.07 or 9.04) or in accordance with a Change of Control Offer pursuant to Section 4.11, not involving a transfer. |
Upon presentation for exchange or transfer of any Note as permitted by the terms of this Indenture and by any legend appearing on such Note, such Note shall be exchanged or transferred upon the Security Register and one or more new Notes shall be authenticated and issued in the name of the Holder (in the case of exchanges only) or the transferee, as the case may be. No exchange or transfer of a Note shall be effective under this Indenture unless and until such Note has been registered in the name of such Person in the Security Register. Furthermore, the exchange or transfer of any Note shall not be effective under this Indenture unless the request for such exchange or transfer is made by the Holder or by a duly authorized attorney-in-fact at the office of the Registrar.
Every Note presented or surrendered for registration of transfer or for exchange shall (if so required by the Issuer or the Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Issuer and the Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.
All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuer evidencing the same indebtedness, and entitled to the same benefits under this Indenture as the Notes surrendered upon such registration of transfer or exchange.
Neither the Issuer nor the Trustee, Registrar or any Paying Agent shall be required (i) to issue, register the transfer of, or exchange any Note during a period beginning at the opening of 15 Business Days before the day of the mailing of a notice of redemption of Notes selected for redemption under Section 3.02 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.
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(b) Notwithstanding any provision to the contrary herein, so long as a Global Note remains outstanding and is held by or on behalf of DTC or the Common Depositary, transfers of a Global Note, in whole or in part, or of any beneficial interest therein, shall only be made in accordance with Section 2.01(c), Section 2.06(a) and this Section 2.06(b); provided, that a beneficial interest in a Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Global Note in accordance with the transfer restrictions set forth in the restricted Note legend on the Note, if any. |
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(i) Except for transfers or exchanges made in accordance with any of clauses (ii) through (v) of this Section 2.06(b), transfers of a Global Note shall be limited to transfers of such Global Note in whole, but not in part, to nominees of DTC or the Common Depositary or to a successor of DTC or the Common Depositary or such successor’s nominee. |
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(ii) Restricted Dollar Global Note to Regulation S Dollar Global Note. If the holder of a beneficial interest in the Restricted Dollar Global Note at any time wishes to exchange its interest in such Restricted Dollar Global Note for an interest in the Regulation S Dollar Global Note, or to transfer its interest in such Restricted Dollar Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Dollar Global Note, such transfer or exchange may be effected, only in accordance with this clause (ii) and the rules and procedures of DTC, Euroclear and Clearstream, in each case to the extent applicable (the “Applicable Procedures”). Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Dollar Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Dollar Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted Dollar Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Dollar Global Note and shall cause the Common Depositary to increase or cause to be increased the principal amount of the Regulation S Dollar Global Note by the aggregate principal amount of the interest in the Restricted Dollar Global Note to be exchanged or transferred. |
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(iii) Regulation S Dollar Global Note to Restricted Dollar Global Note. If the holder of a beneficial interest in the Regulation S Dollar Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Dollar Global Note, such transfer may be effected only in accordance with this clause (iii) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Dollar Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Dollar Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuer or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Dollar Global Note and to increase or cause to be increased the principal |
amount of the Restricted Dollar Global Note by the aggregate principal amount of the interest in such Regulation S Dollar Global Note to be exchanged or transferred. |
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(iv) Restricted Euro Global Note to Regulation S Euro Global Note. If the holder of a beneficial interest in the Restricted Euro Global Note at any time wishes to exchange its interest in such Restricted Euro Global Note for an interest in the Regulation S Euro Global Note, or to transfer its interest in such Restricted Euro Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Regulation S Euro Global Note, such transfer or exchange may be effected, only in accordance with this clause (iv) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Regulation S Euro Global Note in a specified principal amount and to cause to be debited an interest in the Restricted Euro Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit B attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and (x) pursuant to and in accordance with Regulation S or (y) that the interest in the Restricted Euro Global Note being transferred is being transferred in a transaction permitted by Rule 144, then the Registrar shall reduce or cause to be reduced the principal amount of the Restricted Euro Global Note and shall cause the Common Depositary to increase or cause to be increased the principal amount of the Regulation S Euro Global Note by the aggregate principal amount of the interest in the Restricted Euro Global Note to be exchanged or transferred. |
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(v) Regulation S Euro Global Note to Restricted Euro Global Note. If the holder of a beneficial interest in the Regulation S Euro Global Note at any time wishes to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Restricted Euro Global Note, such transfer may be effected only in accordance with this clause (v) and the Applicable Procedures. Upon receipt by the Registrar from the Transfer Agent of (A) written instructions directing the Registrar to credit or cause to be credited an interest in the Restricted Euro Global Note in a specified principal amount and to cause to be debited an interest in the Regulation S Euro Global Note in such specified principal amount, and (B) a certificate in the form of Exhibit C attached hereto given by the holder of such beneficial interest stating that the transfer of such interest has been made in compliance with the transfer restrictions applicable to the Global Notes and stating that (x) the Person transferring such interest reasonably believes that the Person acquiring such interest is a QIB and is obtaining such interest in a transaction meeting the requirements of Rule 144A and any applicable securities laws of any state of the United States or (y) that the Person transferring such interest is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act and, in such circumstances, such Opinion of Counsel as the Issuer or the Trustee may reasonably request to ensure that the requested transfer or exchange is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, then the Registrar shall reduce or cause to be reduced the principal amount of the Regulation S Euro Global Note and to increase or cause to be increased the principal amount of the Restricted Euro Global Note by the aggregate principal amount of the interest in the Regulation S Euro Global Note to be exchanged or transferred. |
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(c) If Notes are issued upon the transfer, exchange or replacement of Notes bearing the restricted Notes legends set forth in Exhibit A-1 or Exhibit A-2 hereto, as applicable, the Notes so issued shall bear the restricted Notes legends, and a request to remove such restricted Notes legends from Notes shall not be honored unless there is delivered to the Issuer such satisfactory evidence, which may include an Opinion of Counsel licensed to practice law in the State of New York, as may be reasonably required by the Issuer, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A or Rule 144 under the Securities Act. Upon provision of such satisfactory evidence, the Trustee, at the direction of the Issuer, shall (or shall direct the authenticating agent to) authenticate and deliver Notes that do not bear the legend. |
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(d) The Trustee and the Agents shall have no responsibility for any actions taken or not taken by DTC, Euroclear or Clearstream, as the case may be. |
. If a mutilated certificated Note is surrendered to the Registrar or if the Holder claims that the Note has been lost, destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall (or shall direct the authenticating agent to), upon receipt of an Issuer Order, authenticate a replacement Note in such form as the Note mutilated, lost, destroyed or wrongfully taken if the Holder satisfies any other reasonable requirements of the Issuer and any requirement of the Trustee. If required by the Trustee or the Issuer, such Holder shall furnish an indemnity bond sufficient in the judgment of the Issuer and the Trustee to protect the Issuer, the Trustee, the Paying Agent, the Transfer Agent, the Registrar and any co-Registrar, and any authenticating agent from any loss that any of them may suffer if a Note is replaced. The Issuer and the Trustee may charge the Holder for their expenses in replacing a Note.
In the event any such mutilated, lost, destroyed or wrongfully taken Note has become or is about to become due and payable, the Issuer in its discretion may pay such Note instead of issuing a new Note in replacement thereof.
Every replacement Note shall be an additional obligation of the Issuer.
The provisions of this Section 2.07 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or wrongfully taken Notes.
. Notes outstanding at any time are all Notes authenticated by or on behalf of the Trustee except for those cancelled by it, those delivered to it for cancellation and those described in this Section 2.08 as not outstanding. Subject to Section 2.09, a Note does not cease to be outstanding because the Issuer or an Affiliate of the Issuer holds the Note.
If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Issuer receive proof satisfactory to them that the Note that has been replaced is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture on a Redemption Date or maturity date money sufficient to pay all principal, interest and Additional Amounts, if any, payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.
. In determining whether the Holders of the required principal amount of Notes have concurred in any direction or consent or any amendment, modification or other change to this Indenture Notes owned by the Issuer or by an Affiliate of the Issuer shall be disregarded and treated as if they were not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent or any amendment, modification or other change to this Indenture only Notes which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded. Notes so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Notes and that the pledgee is not the Issuer or an Affiliate of the Issuer.
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(a) A Global Note deposited with the Common Depositary or a custodian for DTC, as the case may be, pursuant to Section 2.01 shall be transferred in whole to the beneficial owners thereof in the form of certificated Notes only if such transfer complies with Section 2.06 and (i) DTC, Euroclear or Clearstream, as applicable, notifies the Issuer that it is unwilling or unable to continue to act as depositary and a successor depositary is not appointed by the Issuer within 120 days of such notice, or (ii) the owner of a Book-Entry Interest requests such an exchange in writing delivered through DTC, Euroclear or Clearstream following an Event of Default under this Indenture. Notice of any such transfer shall be given by the Issuer in accordance with the provisions of Section 12.02(a). |
the Trustee shall itself or via the authenticating agent authenticate and deliver, upon such transfer of each portion of such Global Note, an equal aggregate principal amount at maturity of Notes of authorized denominations in the form of certificated Notes. Any portion of a Global Note transferred or exchanged pursuant to this Section 2.10 shall be executed, authenticated and delivered only in registered form (i) with respect to Euro Notes, in minimum denominations of €1 and any integral multiples of €1 in excess thereof and registered in such names as the Common Depositary shall direct and (ii) with respect to Dollar Notes, in minimum denominations of $1and any integral multiples of $1 in excess thereof and registered in such names as DTC or the Common Depositary may direct. Subject to the foregoing, a Global Note is not exchangeable except for a Global Note of like denomination to be registered in the name of DTC or its nominee or the Common Depositary or its nominee. In the event that a Global Note becomes exchangeable for certificated Notes, payment of principal, premium, if any, and interest on the certificated Notes will be payable, and the transfer of the certificated Notes will be registrable, at the office or agency of the Issuer maintained for such purposes in accordance with Section 2.03. Such certificated Notes shall bear the applicable legends set forth in Exhibit A-1 or Exhibit A-2 hereto, as applicable. |
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(c) In the event of the occurrence of any of the events specified in Section 2.10(a), the Issuer shall promptly make available to the Trustee and the authenticating agent a reasonable supply of certificated Notes in definitive, fully registered form without interest coupons. |
. The Issuer at any time may deliver Notes to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee, in accordance with its customary procedures, and no one else shall cancel (subject to the record retention requirements of the Exchange Act and the Trustee’s retention policy) all Notes surrendered for registration of transfer, exchange, payment or cancellation and dispose of such cancelled Notes in its customary manner. Except as otherwise provided in this Indenture the Issuer may not issue new Notes to replace Notes it has redeemed, paid or delivered to the Trustee for cancellation.
. Any interest on any Note that is payable, but is not punctually paid or duly provided for, on the dates and in the manner provided in the Notes and this Indenture (all such interest herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder on the relevant Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Issuer, at its election in each case, as provided in clause (a) or (b) below:
Trustee of the proposed payment date pursuant to this clause, such manner of payment shall be deemed reasonably practicable. |
Subject to the foregoing provisions of this Section 2.12, each Note delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.
. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months.
. The Issuer in issuing the Notes may use ISIN, CUSIP and Common Code numbers (if then generally in use), and, if so, the Trustee shall use ISIN, CUSIP and Common Code numbers, as appropriate, in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers or codes either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or omission of such numbers. The Issuer shall promptly notify the Trustee of any change in the ISIN, CUSIP or Common Code numbers.
. The Issuer may redeem all or any portion of the Notes in accordance with Section 6 of the Notes and shall redeem all or portion of the Notes in accordance with Section 7 of the Notes in each case upon the terms and at the Redemption Prices set forth in the Notes. Any redemption pursuant to this Section 3.01 shall be made pursuant to the provisions of this Article Three.
. If the Issuer elects, or is required, to redeem Notes pursuant to Section 3.01, it shall notify the Trustee in writing of the Redemption Date and the record date, the principal amount of Notes to be redeemed, the Redemption Price and the paragraph of the Notes pursuant to which the redemption will occur. If and so long as the Notes are listed on Euronext Dublin and the rules and regulations of Euronext
Dublin so require, the Issuer shall publish the notice of redemption in a newspaper having general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin (www.ise.ie)).
The Issuer shall give each notice to the Trustee provided for in this Section 3.02 in writing at least 10 days before the date notice is mailed to the Holders pursuant to Section 3.04 unless the Trustee consents to a shorter period. Such notice shall be accompanied by an Officer’s Certificate from the Issuer to the effect that such redemption will comply with the conditions herein. If fewer than all the Notes are to be redeemed, the record date relating to such redemption shall be selected by the Issuer and given to the Trustee, which record date shall be not less than 15 days after the date of notice to the Trustee.
. If fewer than all of the Dollar Notes or Euro Notes are to be redeemed at any time, the Dollar Notes or Euro Notes will be selected by a method that complies with the requirements, as certified to it by the Issuer, of the principal securities exchange, if any, on which the Dollar Notes or Euro Notes are listed at such time, and in compliance with the requirements of the relevant clearing system or, if the Dollar Notes or Euro Notes are not listed on a securities exchange, or such securities exchange prescribes no method of selection and the Notes are not held through clearing system or the clearing system prescribes no method of selection, by lot; provided, however, that (i) no such partial redemption shall reduce the portion of the principal amount of a Dollar Note not redeemed to less than $200,000 and (ii) no such partial redemption shall reduce the portion of the principal amount of a Euro Note not redeemed to less than €100,000.
The Trustee or the Registrar shall make the selection from the Notes outstanding and not previously called for redemption. The Trustee or the Registrar may select for redemption portions equal to (i) with respect to Dollar Notes, $1 in principal amount and any integral multiple thereof and (ii) with respect to Euro Notes, €1 in principal amount and any integral multiple thereof; provided that no Euro Notes of €100,000 in principal amount or less and no Dollar Notes of $200,000 in principal amount or less may be redeemed in part. Provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee or the Registrar, as applicable, shall notify the Issuer promptly in writing of the Notes or portions of Notes to be called for redemption.
Neither the Trustee nor the Registrar shall be liable for selections made in accordance with the provisions of this Section 3.03.
Any redemption and notice in respect of an optional redemption described in Section 6 of the Notes may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent. Any redemption and notice in respect of a mandatory redemption described in Section 7 of the Notes may, in the Issuer’s discretion, be subject to a condition precedent that the sale of the Qualified Capital Stock has closed.
Unless the option for pro rata pass-through distributions of principal is clearly indicated to DTC at the time the issue is made eligible, DTC will process redemptions by means of a random lottery. In the event of a pro rata pass-through distribution of principal, the Trustee or Registrar shall send DTC’s Announcements Department written notice clearly indicating that it relates to a pro rata pass-through distribution of principal.
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(a) At least 10 days but not more than 60 days before a date for redemption of the Euro Notes and/or Dollar Notes, as the case may be, the Issuer shall mail a notice of redemption by first-class mail to each Holder to be redeemed and shall comply with the provisions of Section 12.02(b). |
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(b) The notice shall identify the Notes to be redeemed (including ISIN, CUSIP and Common Code numbers, as applicable) and shall state: |
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(i) the Redemption Date and the record date; |
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(ii) the appropriate calculation of the Redemption Price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid; |
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(iii) the name and address of the Paying Agent; |
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(iv) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any, and Additional Amounts, if any; |
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(v) that, if any Note is being redeemed in part, the portion of the principal amount (equal to (x) $1 in principal amount or any integral multiple thereof with respect to Dollar Notes and (y) €1 in principal amount or any integral multiple thereof with respect to Euro Notes) of such Note to be redeemed and that, on and after the Redemption Date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be reissued; |
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(vi) that, if any Note contains an ISIN, CUSIP or Common Code number, no representation is being made as to the correctness of such ISIN, CUSIP or Common Code number either as printed on the Notes or as contained in the notice of redemption and that reliance may be placed only on the other identification numbers printed on the Notes; |
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(vii) that, unless the Issuer defaults in making such redemption payment, interest on the Notes (or portion thereof) called for redemption shall cease to accrue on and after the Redemption Date; and |
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(viii) the section and paragraph of the Notes pursuant to which the Notes called for redemption are being redeemed. |
At the Issuer’s written request, the Trustee shall give a notice of redemption in the Issuer’s name and at the Issuer’s expense. In such event, the Issuer shall provide the Trustee with the notice and the other information required by this Section 3.04.
. At least one Business Day prior to any Redemption Date, by no later than 12:00 p.m. (London time) on that date, the Issuer shall deposit or cause to be deposited with the Paying Agent (or, if the Issuer or an Affiliate of the Issuer is the Paying Agent, shall segregate and hold in trust) a sum in same day funds sufficient to pay the Redemption Price of and accrued interest and Additional Amounts, if any, on all Notes to be redeemed on that date other than Notes or portions of Notes called for redemption that have previously been delivered by the Issuer to the Trustee for cancellation. The Paying Agent shall return to the Issuer following a written request by the Issuer any money so deposited that is not required for that purpose.
. If notice of redemption has been given in the manner provided below, the Notes or portion of Notes specified in such notice to be redeemed shall become due and payable on the Redemption Date at the Redemption Price stated therein, together with accrued interest to such Redemption Date, and on and after such date (unless the Issuer shall default in the payment of such Notes at the Redemption Price and accrued interest to the Redemption Date, in which case the principal, until paid, shall bear interest from the Redemption Date at the rate prescribed in the Notes) such Notes shall cease to accrue interest. Upon surrender of any Note for redemption in accordance with a notice of redemption, such Note shall be paid and redeemed by the Issuer at the Redemption Price, together with accrued interest, if any, to the Redemption Date; provided that installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders registered as such at the close of business on the relevant Record Date.
Notice of redemption shall be deemed to be given when mailed, whether or not the Holder receives the notice. In any event, failure to give such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of Notes held by Holders to whom such notice was properly given.
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(a) Upon surrender of a Global Note that is redeemed in part, the Paying Agent shall forward such Global Note to the Trustee who shall make a notation on the Security Register to reduce the principal amount of such Global Note to an amount equal to the unredeemed portion of the Global Note surrendered; provided that each such Global Note shall be in a principal amount at final Stated Maturity of (i) in the case of Dollar Notes, $200,000 or an integral multiple of $1 in excess thereof, and (ii) in the case of Euro Notes, €100,000 or an integral multiple of €1 in excess thereof. |
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(b) Upon surrender and cancellation of a certificated Note that is redeemed in part, the Issuer shall execute and the Trustee shall authenticate for the Holder (at the Issuer’s expense) a new Note equal in principal amount to the unredeemed portion of the Note surrendered and canceled; provided that each such certificated Note shall be in a principal amount at final Stated Maturity of (i) in the case of Dollar Notes, $200,000 or an integral multiple of $1 in excess thereof, and (ii) in the case of Euro Notes, €100,000 or an integral multiple of €1 in excess thereof. |
. The Issuer covenants and agrees for the benefit of the Holders that it shall duly and punctually pay the principal of, premium, if any, interest and Additional Amounts, if any, on the Notes on the dates and in the manner provided in the Notes and in this Indenture. Subject to Section 2.04, principal, premium, if any, interest and Additional Amounts, if any, shall be considered paid on the date due if on such date the Trustee or the Paying Agent (other than the Issuer or any of its Affiliates) holds, as of 10:00 a.m.’ London, England time on the due date, in accordance with this Indenture money or, to the extent so elected by the Issuer in accordance with Section 2.01(d) and the terms and provisions of the Notes in respect of interest or Additional Amounts, if any, Additional Notes, sufficient to pay all principal, premium, if any, interest and Additional Amounts, if any, then due. If the Issuer or any of its Affiliates acts as Paying Agent, principal, premium, if any, interest and Additional Amounts, if any, shall be considered paid on the due date if the entity acting as Paying Agent complies with Section 2.04.
The Issuer shall pay interest on overdue principal at the rate specified therefor in the Notes. The Issuer shall pay interest on overdue installments of interest at the same rate to the extent lawful.
. Subject to Article Five, the Issuer and each Restricted Subsidiary shall do or cause to be done all things necessary to preserve and keep in full force and effect their corporate, partnership, limited liability company or other existence and the rights (charter and statutory), licenses and franchises of the Issuer and each such Restricted Subsidiary; provided that the Issuer shall not be required to preserve any or keep in full force and effect any such existence or such right, license or franchise if the Board of Directors of the Issuer shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Issuer and its Restricted Subsidiaries as a whole and that the loss thereof is not disadvantageous in any material respect to the Holders.
. The Issuer shall cause all properties owned by it or any of its Restricted Subsidiaries or used or held for use in the conduct of its business or the business of any of its Restricted Subsidiaries to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and shall cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of the Issuer may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided that nothing in this Section 4.03 shall prevent the Issuer from discontinuing the maintenance of any such properties if such discontinuance is, in the judgment of the Issuer, desirable in the conduct of the business of the Issuer and its Restricted Subsidiaries as a whole and not disadvantageous in any material respect to the Holders.
. The Issuer shall maintain, and shall cause its Restricted Subsidiaries to maintain, insurance with carriers believed by the Issuer to be responsible, against such risks and in such amounts, and with such deductibles, retentions, self-insured amounts and coinsurance provisions, as the Issuer believes are customarily carried by businesses similarly situated and owning like properties, including as appropriate general liability, property and casualty loss and interruption of business insurance.
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(a) The Issuer shall deliver to the Trustee, within 120 days after the end of each fiscal year or within 14 days of written request by the Trustee, an Officer’s Certificate stating that in the course of the performance by the signer of its duties as an officer of the Issuer he would normally have knowledge of any Default and whether or not the signer knows of any Default that occurred during such period and if any specifying such Default, its status and what action the Issuer is taking or proposed to take with respect thereto. For purposes of this Section 4.05(a), such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. |
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(b) If the Issuer shall become aware that (i) any Default or Event of Default has occurred and is continuing or (ii) any Holder seeks to exercise any remedy hereunder with respect to a claimed Default under this Indenture or the Notes, the Issuer shall immediately deliver to the Trustee an Officer’s Certificate specifying such event, notice or other action (including any action the Issuer is taking or proposes to take in respect thereof). |
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(a) The Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, create, issue, incur, assume, guarantee or in any manner become directly or indirectly liable with respect to or otherwise become responsible for, contingently or otherwise, the payment of (individually and collectively, to “incur” or, as appropriate, an “incurrence”), any Debt (including any Acquired Debt); provided that any Permitted Subsidiary shall be permitted to incur Debt (including Acquired Debt) if (i) after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, no Default or Event of Default would occur or be continuing and (ii) at the time of such incurrence and after giving effect to the incurrence of such Debt and the application of the proceeds thereof, on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio for the Issuer for the four full fiscal quarters for which financial statements are available immediately preceding the incurrence of such Debt, taken as one period, would be greater than 2.0 to 1.0. |
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(b) Section 4.06(a) will not, however, prohibit the following (collectively, “Permitted Debt”): |
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(i) the incurrence by Permitted Subsidiaries of Debt under Credit Facilities in an aggregate principal amount not to exceed the greater of (i) $700,000,000 and (ii) an amount equal to (I) 85% of Total Receivables plus 70% of Total Inventories less (II) $275,000,000; |
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(ii) the incurrence by the Issuer of Debt represented by (i) the original Notes issued on the Issue Date and (ii) Additional Notes issued from time to time in payment of interest or Additional Amounts on (x) such Notes or (y) such Additional Notes so issued from time to time; |
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(iii) any Debt of the Issuer or any of its Restricted Subsidiaries (other than Debt described in clauses (i) and (ii) of this paragraph (b)); outstanding on the Issue Date; |
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(iv) the incurrence by the Issuer or any of its Restricted Subsidiaries of intercompany Debt between the Issuer and any of its Restricted Subsidiaries or between or among Restricted Subsidiaries; provided that: |
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(A) if the Issuer is the obligor on any such Debt, such Debt must be unsecured (except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with cash management, cash pooling, tax and accounting operations of the Issuer and its Restricted Subsidiaries); and |
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(A) (x) any disposition, pledge or transfer of any such Debt to a Person (other than a disposition, pledge or transfer to the Issuer or a Restricted Subsidiary of the Issuer) and (y) any transaction pursuant to which any Restricted Subsidiary that has Debt owing by the Issuer or another Restricted Subsidiary of the Issuer ceases to be a Restricted Subsidiary of the Issuer, will, in each case, be deemed to be an incurrence of such Debt not permitted by this clause (iv); |
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(v) guarantees of (i) the Issuer’s Debt by Restricted Subsidiaries that are not Permitted Subsidiaries; (ii) Debt of any of its Restricted Subsidiaries that are not Permitted Subsidiaries by any Restricted Subsidiary that is not a Permitted Subsidiary; and (iii) Debt of any Permitted Subsidiary by any Permitted Subsidiary to the extent that the guaranteed Debt was permitted to be incurred by another provision of this Section 4.06; |
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(vi) the incurrence by any Permitted Subsidiaries of Debt represented by Capitalized Lease Obligations, mortgage financings, purchase money obligations or other Debt incurred or assumed in connection with the acquisition or development of real or personal, movable or immovable, property or assets, in each case, incurred for the purpose of financing or refinancing all or any part of the purchase price, lease expense or cost of construction or improvement of property, plant, equipment or other assets used in any Permitted Subsidiary’s business (including any reasonable related fees or expenses incurred in connection with such acquisition or development); provided that the principal amount of such Debt so incurred when aggregated with other Debt previously incurred in reliance on this clause (vi) and still outstanding shall not in the aggregate exceed the greater of $510,000,000 and 6.0% of Total Assets; and provided, further, that the total principal amount of any Debt incurred in connection with an acquisition or development permitted under this clause (vi) did not in each case at the time of incurrence exceed (A) the Fair Market Value of the acquired or constructed asset or improvement so financed or (B) in the case of an uncompleted constructed asset, the amount of the asset to be constructed, as determined on the date the contract for construction of such asset was entered into by the relevant Permitted Subsidiary (including, in each case, any reasonable related fees and expenses incurred in connection with such acquisition, construction or development); |
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(vii) the incurrence by the Issuer or any of its Restricted Subsidiaries of Debt arising from agreements providing for guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock (other than guarantees or similar credit support given by the Issuer or any of its Restricted Subsidiaries of Debt incurred by any Person acquiring all or any portion of such assets for the purpose of financing such acquisition); provided that the maximum aggregate liability in respect of all such Debt permitted pursuant to this clause (vii) shall at no time exceed the net proceeds, including non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received from the sale of such assets; |
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(viii) the incurrence by any Permitted Subsidiary of Debt under Commodity Hedging Agreements not for speculative purposes; |
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(ix) the incurrence by the Issuer or any of its Restricted Subsidiaries of Debt under Currency Agreements not for speculative purposes; |
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(x) the incurrence by the Issuer or any of its Restricted Subsidiaries of Debt under Interest Rate Agreements not for speculative purposes; |
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(xi) the incurrence of Debt by the Issuer or any of its Restricted Subsidiaries of Debt in respect of workers’ compensation and claims arising under similar legislation, or pursuant to self-insurance obligations and not in connection with the borrowing of money or the obtaining of advances or credit; |
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(xii) the incurrence of Debt by the Issuer or any of its Restricted Subsidiaries arising from (A) the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Debt is extinguished within five Business Days of incurrence, (B) bankers’ acceptances, performance, surety, judgment, completion, payment, appeal or similar bonds, instruments or obligations, (C) completion guarantees, advance payment, customs, VAT or other tax guarantees or similar instruments provided or letters of credit obtained by any Permitted Subsidiary in the ordinary course of business, and (D) the financing of insurance premiums in the ordinary course of business; |
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(xiii) any Debt of Permitted Subsidiaries incurred pursuant to any Permitted Receivables Financing; |
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(xiv) the incurrence by a Person of Permitted Refinancing Debt in exchange for or the net proceeds of which are used to refund, replace or refinance Debt incurred by it pursuant to, or described in, paragraphs (a), (b)(ii) and (b)(iii), this paragraph (b)(xiv) and paragraphs (b)(xviii), (b)(xix) and (b)(xx) of this Section 4.06, as the case may be; |
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(xv) guarantees by Permitted Subsidiaries of Debt incurred by Permitted Joint Ventures in an aggregate principal amount at any one time outstanding not to exceed an amount equal to the greater of $150,000,000 and 2.0% of Total Assets; |
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(xvi) cash management obligations and Debt in respect of netting services, pooling arrangements or similar arrangements in connection with cash management in the ordinary course of business consistent with past practice; |
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(xvii) (i) take-or-pay obligations in the ordinary course of business, (ii) customer deposits and advance payments in the ordinary course of business received from customers for goods or services purchased in the ordinary course of business and (iii) manufacturer, vendor financing, customer and supply arrangements in the ordinary course of business; |
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(xviii) the incurrence of Debt by Permitted Subsidiaries (other than and in addition to Debt permitted under clauses (i) through (xvii) above and clauses (xix) and (xx) below) in an aggregate principal amount at any one time outstanding not to exceed, together with any Permitted Refinancing Debt in respect thereof, the greater of $350,000,000 and 5.0% of Total Assets; |
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(xix) Debt of any Permitted Subsidiary (x) incurred and outstanding on the date on which such Person becomes a Permitted Subsidiary or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Permitted Subsidiary or (y) incurred to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Permitted Subsidiary or was otherwise acquired by a Permitted Subsidiary; provided, however, with respect to each of clause (xix)(x) and (xix)(y), that at the time of such acquisition or other transaction (1) a Permitted Subsidiary would have been able to incur $1.00 of additional Debt pursuant to Section 4.06(a) after giving effect to the incurrence of such Debt pursuant to this clause (xix) or (2) the Fixed Charge Coverage Ratio of the Issuer and its Restricted Subsidiaries would not be less than it was immediately prior to giving pro forma effect to such acquisition or other transaction; |
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(xx) Contribution Debt; and |
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(xxi) the incurrence of Debt by a Permitted Subsidiary consisting of local lines of credit, overdraft facilities or local working capital facilities in an aggregate outstanding principal amount at any one time not to exceed the greater of $75,000,000 and 1.0% of Total Assets. |
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(c) Accrual of interest or dividends, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest or dividends in the form of additional Debt of the same class will not be deemed to be an incurrence of Debt for purposes of this Section 4.06. |
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(d) For purposes of determining compliance with any restriction on the incurrence of Debt in euros where Debt is denominated in a different currency, the amount of such Debt will be the Euro Equivalent determined on the date of such determination; provided that if any such Debt denominated in a different currency is subject to a Currency Agreement (with respect to euros) covering principal amounts payable on such Debt, the amount of such Debt expressed in euros shall be adjusted to take into account the effect of such agreement. The principal amount of any Permitted Refinancing Debt incurred in the same currency as the Debt being refinanced shall be the Euro Equivalent of the Debt refinanced determined on the date such Debt being refinanced was initially incurred. |
Notwithstanding any other provision of this Section 4.06, for purposes of determining compliance with this Section 4.06, increases in Debt solely due to fluctuations in the exchange rates of currencies will not be deemed to exceed the maximum amount that the Issuer or its Restricted Subsidiaries may incur under this Section 4.06. |
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(e) For purposes of determining any particular amount of Debt under this Section 4.06: |
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(i) obligations with respect to letters of credit, guarantees or Liens, in each case supporting Debt otherwise included in the determination of such particular amount shall not be included; |
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(ii) accrual of interest, accrual of dividends, the accretion of accreted value, the obligation to pay commitment fees and the payment of interest in the form of additional preferred stock or Debt shall not be treated as Debt; and |
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(iii) the reclassification of preferred stock as Debt due to a change in accounting principles shall not be treated as Debt. |
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(f) In the event that an item of Debt meets the criteria of more than one of the types of Debt described in this Section 4.06, the Issuer, in its sole discretion, shall classify items of Debt and shall only be required to include the amount and type of such Debt in one of such clauses and the Issuer shall be entitled to divide and classify an item of Debt in more than one of the types of Debt described in this Section 4.06, and may change the classification of an item of Debt (or any portion thereof) to any other type of Debt described in this Section 4.06 at any time. |
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(g) The amount of any Debt outstanding as of any date will be: |
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(i) in the case of any Debt issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS; |
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(ii) the principal amount of the Debt, in the case of any other Debt; and |
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(iii) in respect of Debt of another Person secured by a Lien on the assets of the specified Person, the lesser of: |
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(A) the Fair Market Value of such assets at the date of determination; and |
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(A) the amount of the Debt of the other Person. |
. The Issuer shall not, and shall not permit any of its Restricted Subsidiaries that are not Permitted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind or assign or otherwise convey any right to receive any income, profits or proceeds on or with respect to any of the Issuer’s or any of such Restricted Subsidiaries’ property or assets (but excluding any Capital Stock, Debt or other securities of any Unrestricted Subsidiary of the Issuer), whether owned at or acquired after the Issue Date, or any income, profits or proceeds therefrom except (a) in the case of any property or asset that does not constitute Collateral, Permitted Liens and (b) in the case of any property or asset that constitutes Collateral, Permitted Collateral Liens.
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(a) The Issuer shall not, and shall not permit any of its Restricted Subsidiaries (other than Permitted Subsidiaries) to, directly or indirectly, take any of the following actions (each of which is a “Restricted Payment” and which are collectively referred to as “Restricted Payments”): |
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(i) declare or pay any dividend on or make any distribution (whether made in cash, securities or other property) with respect to any of the Issuer’s or any of such Restricted Subsidiaries’ Capital Stock (including, without limitation, any payment in connection with any merger or consolidation involving the |
Issuer or any such Restricted Subsidiaries) (other than (A) to the Issuer or any such Restricted Subsidiaries or (B) to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Issuer or such Restricted Subsidiary of dividends or distributions of greater value than the Issuer or such Restricted Subsidiary would receive on a pro rata basis); |
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(ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation), directly or indirectly, any shares of the Issuer’s Capital Stock held by persons other than the Issuer or such Restricted Subsidiaries or any options, warrants or other rights to acquire such shares of Capital Stock; |
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(iii) make any principal payment on, or repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled principal payment, sinking fund payment or maturity, any Deeply Subordinated Funding; or |
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(iv) make any Investment (other than any Permitted Investment) in any Person. |
If any Restricted Payment described above is not made in cash, the amount of the proposed Restricted Payment shall be the Fair Market Value of the asset to be transferred as of the date of transfer.
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(b) Notwithstanding paragraph (a) above, the Issuer and such Restricted Subsidiary of the Issuer may take the following actions so long as (with respect to clauses (viii) and (xiii) below) no Default or Event of Default has occurred and is continuing: |
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(i) the payment of any dividend within 180 days after the date of its declaration if at such date of its declaration such payment would have been permitted by this Section 4.08; |
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(ii) the repurchase, redemption or other acquisition or retirement for value of any shares of the Issuer’s Capital Stock or options, warrants or other rights to acquire such Capital Stock in exchange for (including any such exchange pursuant to the exercise of a conversion right or privilege in connection with which cash is paid in lieu of the issuance of fractional shares or scrip), or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Issuer) of, shares of the Issuer’s Qualified Capital Stock, options, warrants or other rights to acquire such Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iii) the repurchase, redemption, defeasance or other acquisition or retirement for value or payment of principal of any Deeply Subordinated Funding in exchange for, or out of the Net Cash Proceeds of a substantially concurrent issuance and sale (other than to a Subsidiary of the Issuer) of, shares of the Issuer’s Qualified Capital Stock or Deeply Subordinated Funding (other than any Excluded Contribution or the proceeds of any Contribution Debt); |
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(iv) the repurchase of Capital Stock deemed to occur upon the exercise of stock options with respect to which payment of the cash exercise price has been forgiven if the cumulative aggregate value of such deemed repurchases does not exceed the cumulative aggregate amount of the exercise price of such options received; |
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(v) payments or distributions to dissenting shareholders pursuant to applicable law in connection with or in contemplation of a merger, consolidation or transfer of assets that complies with the provisions of Article Five; |
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(vi) cash payments in lieu of issuing fractional shares pursuant to the exchange or conversion of any exchangeable or convertible securities; |
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(vii) any payments, loans or other distributions (including share premium repayment or dividend distribution) made in accordance with, pursuant to, or in connection with, the use of proceeds from the issuance and sale of the Notes; |
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(viii) [intentionally omitted]; |
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(ix) [intentionally omitted]; |
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(x) any payments (including pursuant to a tax sharing agreement or similar arrangement) between the Issuer and any other Person or a Restricted Subsidiary and any other Person with which the Issuer or any of its Restricted Subsidiaries files a consolidated tax return or with which the Issuer or any of its Restricted Subsidiaries is part of a group for tax purposes (including a fiscal unity) or any tax advantageous group contribution made pursuant to applicable legislation; provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Issuer and its Restricted Subsidiaries on a stand-alone basis and the related tax liabilities of the Issuer and its Restricted Subsidiaries are relieved thereby; |
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(xi) Restricted Payments in an amount equal to the amount of Excluded Contributions made; |
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(xii) dividends or other distributions of Capital Stock of Unrestricted Subsidiaries; |
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(xiii) any other Restricted Payment; provided that the total aggregate amount of Restricted Payments made under this clause (xiii) does not exceed $10,000,000; |
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(xiv) (i) any other Restricted Payment to give effect to the transactions and/or payments described under “Use of Proceeds” in the Offering Memorandum and (ii) any Restricted Payment made in connection with the Trivium Transactions (including, for the avoidance of doubt, any payments contemplated by the Trivium Transaction Agreement), and any costs and expenses (including all legal, accounting and other professional fees and expenses) related thereto or used to fund amounts owed to Affiliates in connection with the Trivium Transactions (including dividends to any parent entity to permit payment by such parent entity of such amounts); and |
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(xv) Restricted Payments with cash from dividends or other distributions (including by way of redemptions or repurchases of shares) received by the Issuer, directly or indirectly, from its Subsidiaries following the Issue Date, in an amount not to exceed the Available Restricted Payment Amount; provided that: |
(i)as of the date of such Restricted Payment, the Issuer has made a payment of 100% Cash Interest on the most recent interest payment date and has not failed to make a payment of 100% Cash Interest on the Notes on more than one prior interest payment date with cash from dividends or other distributions (including by way of redemptions or repurchases of shares) received by the Issuer, directly or indirectly, from its Subsidiaries; provided that if the Issuer has failed to make a payment of 100% Cash Interest on the Notes on one prior interest payment date, the Issuer shall have, redeemed or purchased by way of optional redemption, tender offer, open market purchases, negotiated transactions or otherwise or any combination thereof, an amount of Notes equal to all outstanding PIK Interest Notes (it being understood that such obligation shall be in addition to any other requirement to purchase or redeem Notes under this Indenture);
(ii)(A) if such Restricted Payment is made prior to November 15, 2022 the Issuer has deposited in the Escrow Account an amount not less than the amount of such Restricted Payment; or
(B)if such Restricted Payment is made on or after November 15, 2022, the Issuer has redeemed Notes pursuant to the provisions described under paragraph 6(c) of the Notes for total consideration not less than the amount of such Restricted Payment (less reasonable fees and expenses incurred in connection with such redemption);
(iii)no Default or Event of Default has occurred and is continuing; and
(iv)the aggregate amount of Restricted Payments made pursuant to this clause (o) shall not exceed, in any twelve month period, 10% of the aggregate principal amount of the Notes issued on the Issue Date (the “Annual Distributable Amount”), with any portion of the Annual Distributable Amount not used to make Restricted Payments in such twelve‑month period carried over and available to make Restricted Payments pursuant to this clause (o) in subsequent twelve‑month periods.
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(c) For purposes of determining compliance with this Section 4.08, in the event that a Restricted Payment meets the criteria of more than one of the categories described in sub-clauses (i) through (xiii) of Section 4.08(b), the Issuer and its Restricted Subsidiaries will be entitled to classify such Restricted Payment (or portion thereof) on the date of its payment or later reclassify such Restricted Payment (or portion thereof) in any manner that complies with this Section 4.08. The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Issuer or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. |
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(a) The Issuer shall not, and shall not permit any of its Restricted Subsidiaries to consummate any Asset Sale unless: |
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(i) the consideration the Issuer or such Restricted Subsidiary receives for such Asset Sale is not less than the Fair Market Value of the assets sold (as determined in good faith by the Issuer’s Board of Directors); and |
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(ii) in relation to Asset Sales by Permitted Subsidiaries only, at least 75% of the consideration such person receives in respect of such Asset Sale consists of (A) cash (including any Net Cash Proceeds received from the conversion within 90 days of such Asset Sale of securities, notes or other obligations received in consideration of such Asset Sale); (B) Cash Equivalents; (C) the assumption by the purchaser of (x) Debt of any Restricted Subsidiary as a result of which no Restricted Subsidiary of the Issuer remains obligated in respect of such Debt or (y) Debt of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, if each other Restricted Subsidiary is released from any guarantee of such Debt as a result of such Asset Sale; (D) Replacement Assets; (E) any Designated Non-cash Consideration received by such Restricted Subsidiary in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (ii), not to exceed the greater of $225,000,000 and 3.0% of Total Assets at the time of the receipt of such Designated Non-cash Consideration, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value; or (F) a combination of the consideration specified in clauses (A) to (E). |
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(b) If a Pledged Company issues Capital Stock or a Permitted Subsidiary consummates an Asset Sale, the Net Cash Proceeds from the issuance of Capital Stock or such other Asset Sale, within 360 days after the consummation of such Asset Sale, may be used by it to (A) permanently repay, purchase or prepay any then outstanding Debt of a Permitted Subsidiary (and to effect a corresponding commitment reduction if such Debt is revolving credit borrowings) owing to a Person other than the Issuer or a Restricted Subsidiary of the Issuer; (B) invest in any Replacement Assets, (C) acquire all or substantially all the assets of, or any Capital Stock of, another Similar Business, if, after giving effect to any such acquisition of Capital Stock, the Similar Business is or becomes a Restricted Subsidiary, or (D) any combination of the foregoing; provided that any investment in Replacement Assets made pursuant to a binding agreement or a commitment approved by the Board of Directors of a Pledged Company that is executed or approved within such time will satisfy this requirement so long as such investment is consummated within 180 days of such 360th day. The amount of such Net Cash Proceeds not so used as set forth in this paragraph (b) constitutes “Operating Group Excess Proceeds.” The Issuer may reduce revolving credit borrowings or otherwise invest such Net Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. Such Operating Group Excess Proceeds shall be used in any way that does not violate the applicable indentures or credit agreements of the respective Permitted Subsidiaries. |
. The Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or suffer to exist any transaction or series of related transactions (including, without limitation, the sale, purchase, exchange or lease of assets or property or the rendering of any service) with, or for the benefit of, any Affiliate of the Issuer or any of its Restricted Subsidiaries involving aggregate consideration in excess of the greater of $75,000,000 and 2.0% of Total Assets:
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(a) such transaction or series of transactions is on terms that, taken as a whole, are not materially less favorable to the Issuer or such Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable arm’s‑length transaction with third parties that are not Affiliates; and |
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(b) with respect to any transaction or series of related transactions involving aggregate payments or the transfer of assets or provision of services, in each case having a value greater than the greater of $150,000,000 and 2.0% of Total Assets, the Issuer shall deliver a resolution of its Board of Directors (set out in an Officer’s Certificate to the Trustee) resolving that such transaction complies with clause (a) above and that the fairness of such transaction has been approved by a majority of the Disinterested Directors (or in the event there is only one Disinterested Director, by such Disinterested Director) of the Issuer’s Board of Directors. |
Notwithstanding the foregoing, the restrictions set forth in this description will not apply to:
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(i) customary directors’ fees, indemnification and similar arrangements (including the payment of directors’ and officers’ insurance premiums), consulting fees, employee salaries, bonuses, employment agreements and arrangements, compensation or employee benefit arrangements, including stock options or legal fees; |
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(ii) any Restricted Payment not prohibited by Section 4.08 or the making of an Investment that is a Permitted Investment or “restricted payments” and “permitted investments,” as defined in the 2019 Indenture and not prohibited thereunder; |
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(iii) the agreements and arrangements existing on the Issue Date and any amendment, modification or supplement thereto; provided that any such amendment, modification or supplement to the terms thereof is not more disadvantageous to the Holders and to the Issuer and its Restricted Subsidiaries, as applicable, in any material respect than the original agreement or arrangement as in effect on the Issue Date; |
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(iv) any payments or other transactions pursuant to a tax sharing agreement between the Issuer or any Restricted Subsidiary and any other Person with which the Issuer or such Restricted Subsidiary files a consolidated tax return or with which the Issuer or such Restricted Subsidiary is part of a consolidated group for tax purposes or any tax advantageous group contribution made pursuant to applicable legislation; provided, however, that any such payments do not exceed the amounts of such tax that would have been payable by the Issuer and its Restricted Subsidiaries on a stand‑alone basis and the related tax liabilities of the Issuer and its Restricted Subsidiaries are relieved thereby; |
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(v) transactions in the ordinary course of business with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of the Issuer solely because the Issuer owns, directly or through a Restricted Subsidiary, Capital Stock in, or controls, such Person; |
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(vi) the issuance of securities pursuant to, or for the purpose of the funding of, employment arrangements, stock options, and stock ownership plans, as long as the terms thereof are or have been previously approved by the Issuer’s Board of Directors; |
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(vii) the granting and performance of registration rights for the Issuer’s securities; |
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(viii) (A) issuances or sales of Qualified Capital Stock of the Issuer or Deeply Subordinated Funding and (B) any amendment, waiver or other transaction with respect to any Deeply Subordinated Funding in compliance with the other provisions of this Indenture; |
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(ix) pledges by any Restricted Subsidiary of the Issuer of the Capital Stock of an Unrestricted Subsidiary or a Permitted Joint Venture securing Debt owing by such Unrestricted Subsidiary or a Permitted Joint Venture; |
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(x) transactions with a joint venture made in the ordinary course of business; |
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(xi) transactions between or among the Issuer and its Restricted Subsidiaries or between or among such Restricted Subsidiaries; |
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(xii) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are fair to the Issuer or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Issuer or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person; |
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(xiii) any transaction effected as part of a Permitted Receivables Financing; |
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(xiv) pledges of equity interests of Unrestricted Subsidiaries; |
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(xv) any employment agreement, consultancy agreement or employee benefit arrangement with any employee, consultant, officer or director of the Issuer or any of its Restricted Subsidiaries, including under any stock option, stock appreciation rights, stock incentive or similar plans, entered into in the ordinary course of business; and |
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(xvi) (w) the Trivium Transactions and the payment of all costs and expenses (including all legal, accounting and other professional fees and expenses) related to the Transactions or any payment as contemplated by the Trivium Transaction Agreement; (x) any transactions or services pursuant to the Mutual Services Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s‑length basis; (y) any transactions or services pursuant to the IP Cross‑License Agreement and any services or transactions that are similar or incidental to the services or transactions contemplated therein provided on an arm’s‑length basis and (z) any transactions, services or payments to be made under or in connection with the Shareholders Agreement. |
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(a) If a Change of Control occurs at any time, then the Issuer shall make an offer (a “Change of Control Offer”) to each Holder to purchase such Holder’s Notes, at a purchase price (the “Change of Control Purchase Price”) in cash in an amount equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (the “Change of Control Purchase Date”) (subject to the rights of holders of record on relevant regular Record Dates that are prior to the Change of Control Purchase Date to receive interest due on an Interest Payment Date). |
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(b) Within 30 days following any Change of Control, the Issuer shall, except to the extent that the Issuer has exercised its right to redeem all the Notes as described in paragraph 6(a) of the Notes or paragraph 6(c) of the Notes: |
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(i) cause a notice of the Change of Control Offer to be: |
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(A) delivered to Holders electronically or mailed by first-class mail, postage prepaid, to the address of such holder appearing in the security register, with a copy to the Trustee; and |
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(A) if at the time of such notice the Notes are listed on Euronext Dublin and the rules of Euronext Dublin so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) which notice shall state: |
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(A) that a Change of Control has occurred, and the date it occurred; |
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(A) the circumstances and relevant facts regarding such Change of Control (including, but not limited to, applicable information with respect to pro forma historical income, cash flow and capitalization after giving effect to the Change of Control); |
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(A) the Change of Control Purchase Price and the Change of Control Purchase Date, which shall be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations; |
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(A) that any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Purchase Date unless the Change of Control Purchase Price is not paid; |
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(A) that any Note (or part thereof) not tendered shall continue to accrue interest; and |
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(A) any other procedures that a Holder must follow to accept a Change of Control Offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on Euronext Dublin). |
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(c) On the Change of Control Purchase Date, the Issuer shall, to the extent lawful: |
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(i) accept for payment all Notes or portions thereof (equal to, in the case of Dollar Notes, $200,000 or an integral multiple of $1 in excess thereof, and, in the case of Euro Notes, €100,000 or an integral multiple of €1 in excess thereof) properly tendered pursuant to the Change of Control Offer; |
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(ii) deposit with the Paying Agent an amount equal to the Change of Control Purchase Price in respect of all Notes or portions thereof so tendered; and |
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(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Issuer. |
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(d) The Paying Agent shall promptly mail to each Holder that has properly tendered its Notes pursuant to the Change of Control Offer an amount equal to the Change of Control Purchase Price for such Notes and the Trustee shall itself or via the authenticating agent promptly authenticate and mail (or cause to be transferred by book-entry) to each such Holder a new Note or Notes equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note or Notes shall be in a principal amount of at least $200,000 and in minimum denominations of $1 or integral multiples thereof in the case of the Dollar Notes, and in a principal amount of €100,000 and in minimum denominations of €1 or integral multiples thereof in the case of the Euro Notes. |
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(e) If the Change of Control Purchase Date is on or after an interest Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest, if any, shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date, and no additional interest shall be payable to Holders who tender pursuant to the Change of Control Offer. |
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(f) The Issuer shall not be required to make a Change of Control Offer if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth herein applicable to a Change of Control Offer made by the Issuer and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. |
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(g) The Issuer shall comply with the applicable tender offer rules, including Rule 14e-l under the Exchange Act, and any other applicable securities laws and regulations (including those of Ireland) in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Indenture the Issuer shall comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such conflict. |
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(h) Notwithstanding anything to the contrary contained in this Section 4.11, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. |
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(a) All payments that the Issuer makes under or with respect to the Notes shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which the Issuer is organized, resident or doing business for tax purposes or from or through which it (or its agents, including the Paying Agent) makes any payment on the Notes or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless the Issuer or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If the Issuer or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to the Notes, the Issuer shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted. |
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(b) The Issuer shall not, however, pay Additional Amounts in respect or on account of: |
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(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Holder’s or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of Notes, or by reason of the receipt of any payments in respect of any Notes, or the exercise or enforcement of rights under any Notes); |
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(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of Notes, following the Issuer’s written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction); |
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(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes; |
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(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to the Notes; |
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(v) any Tax imposed on or with respect to any payment by the Issuer to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note; |
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(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union; |
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(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Note been presented on the last day of such 30-day period); |
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(viii) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the Code as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the Code as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or |
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(ix) any combination of the foregoing. |
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(c) If the Issuer is the applicable withholding agent, the Issuer shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law. |
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(d) At least 30 calendar days prior to each date on which any payment under or with respect to the Notes is due and payable, if the Issuer shall be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to the Notes is due and payable, in which case it will be promptly thereafter), the Issuer shall deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and will set forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuer shall promptly publish a notice in accordance with Section 12.02 stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. Such Additional Amounts may be paid by the Issuer, at its option, in the form of cash or Additional Notes. To the extent that the Issuer or any applicable withholding agent is required by law or by the interpretation or administration thereof to make any deduction or withholding from any payment of interest on the Notes or any payment of an Additional Amount which, in either case, is made through the issuance of Additional Notes, the foregoing provisions shall apply with respect to such withholding or deduction requirement, mutatis mutandis. |
In addition, the Issuer shall pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of the Notes or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, the Notes.
Upon written request, the Issuer will furnish to the Trustee or the Principal Paying Agent or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by the Issuer of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of the Issuer to obtain such receipts, the same are not obtainable, the Issuer will provide the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by the Issuer. If requested by the Trustee or the Principal Paying Agent, the Issuer will provide to the Trustee or the Principal Paying Agent, as the case may be, such information as may be reasonably available to the Issuer (and not otherwise in the possession of the Trustee or the Principal Paying Agent, as applicable) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
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(e) Whenever this Indenture or the Notes refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to any Note, such reference includes the payment of Additional Amounts, if applicable. |
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(f) This Section 4.12 will survive any termination, defeasance or discharge of this Indenture and shall apply mutatis mutandis to any jurisdiction in which any successor Person to the Issuer is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on the Notes and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax. |
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SECTION 4.14. Limitation on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries. |
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(a) The Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Restricted Subsidiary of the Issuer to: |
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(i) pay dividends, in cash or otherwise, or make any other distributions (including by way of redemptions or repurchases of shares) on or in respect of its Capital Stock or any other interest or participation in, or measured by, its profits; |
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(ii) pay any Debt owed to the Issuer or any Restricted Subsidiary of the Issuer; |
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(iii) make loans or advances to the Issuer or any Restricted Subsidiary of the Issuer; or |
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(iv) transfer any of its properties or assets to the Issuer or any Restricted Subsidiary of the Issuer. |
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(b) The provisions of paragraph (a) above shall not apply to: |
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(i) encumbrances and restrictions imposed by the Notes, the Existing Ardagh Bonds, this Indenture, the indentures governing the Existing Ardagh Bonds, any Credit Facility, the Intercreditor Agreement and the security documents related thereto or by other indentures or agreements governing other Senior Debt; |
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(ii) any customary encumbrances or restrictions created under any agreements with respect to Debt of the Issuer or any of its Restricted Subsidiaries permitted to be incurred subsequent to the Issue Date pursuant to the provisions of Section 4.06, including encumbrances or restrictions imposed by Debt permitted to be incurred under Credit Facilities or any guarantees thereof in accordance with such covenant; |
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(iii) encumbrances or restrictions contained in any agreement in effect on the Issue Date (other than an agreement described in another clause of this paragraph (b)); |
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(iv) with respect to restrictions or encumbrances referred to in clause (a)(iv) above, encumbrances and restrictions that restrict in a customary manner the subletting, assignment or transfer of any properties or assets that are subject to a lease, license, conveyance or other similar agreement to which the Issuer or any of its Restricted Subsidiaries is a party; |
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(v) encumbrances or restrictions contained in any agreement or other instrument of a Person (including its Subsidiaries), acquired by the Issuer or any of its Restricted Subsidiaries in effect at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired (including its Subsidiaries); |
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(vi) encumbrances or restrictions contained in contracts for sales of Capital Stock or assets permitted by the provisions of Section 4.09 with respect to the assets or Capital Stock to be sold pursuant to such contract or in customary merger or acquisition agreements (or any option to enter into such contract) for the purchase or acquisition of Capital Stock or assets or any of the Issuer’s Subsidiaries by another Person; |
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(vii) with respect to restrictions or encumbrances referred to in clause (a)(iv) above, any customary encumbrances or restrictions pertaining to any asset or property subject to a Lien to the extent set forth in the security document or any related document governing such Lien; |
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(viii) encumbrances or restrictions imposed by applicable law or regulation or by governmental licenses, concessions, franchises or permits; |
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(ix) encumbrances or restrictions on cash or other deposits or net worth imposed by customers under contracts entered into the ordinary course of business; |
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(x) customary limitations on the distribution or disposition of assets or property in joint venture agreements entered into the ordinary course of business and in good faith by any Restricted Subsidiary of the Issuer; provided that such encumbrance or restriction is applicable only to such Restricted Subsidiary and its Subsidiaries; |
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(xi) in the case of clause (a)(iv) above, customary encumbrances or restrictions in connection with purchase money obligations, mortgage financings and Capitalized Lease Obligations for property acquired in the ordinary course of business; |
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(xii) any encumbrance or restriction arising by reason of customary non-assignment provisions in agreements; |
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(xiii) encumbrances or restrictions with respect to any Permitted Receivables Financing; provided that such encumbrances or restrictions are customarily required by the institutional sponsor or arranger of such Permitted Receivables Financing in similar types of documents relating to the purchase of similar receivables in connection with the financing thereof; |
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(xiv) encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to a Permitted Joint Venture; |
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(xv) encumbrances or restrictions incurred in accordance with Section 4.07; or |
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(xvi) any encumbrances or restrictions existing under any agreement that extends, renews, amends, modifies, restates, supplements, refunds, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing clauses (i) through (xv); provided that the terms and |
conditions of any such encumbrances or restrictions are not materially less favorable, taken as a whole, to the Holders than those under or pursuant to the agreement so extended, renewed, amended, modified, restated, supplemented, refunded, refinanced or replaced. |
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(a) The Issuer’s Board of Directors may designate any Subsidiary (other than AGSA or any Subsidiary of the Issuer that is a direct or indirect parent company of AGSA) (including newly acquired or newly established Subsidiaries) to be an “Unrestricted Subsidiary” of the Issuer only if (x) in the case of a Permitted Subsidiary of AGSA, (i) no Default has occurred and is continuing at the time of or after giving effect to such designation, (ii) such Subsidiary or any of its Subsidiaries does not own any Capital Stock of the Issuer or any other Subsidiary of the Issuer which is not a Subsidiary of the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary and (iii) such designation is not prohibited by the 2019 Indenture, or (y) in the case of a Subsidiary of the Issuer which is not a direct or indirect parent company of AGSA and is not a Permitted Subsidiary of AGSA, (i) no Default has occurred and is continuing at the time of or after giving effect to such designation and (ii) such designation (which will be deemed to be an Investment made as of the time of the designation) is permitted by Section 4.08. |
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(b) The Issuer’s Board of Directors may designate any Unrestricted Subsidiary of the Issuer as a Restricted Subsidiary of the Issuer if: |
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(i) no Default or Event of Default has occurred and is continuing at the time of or will occur and be continuing after giving effect to such designation; and |
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(ii) (x) a Permitted Subsidiary could incur at least $1.00 of additional Debt (pursuant to Section 4.06(a)) or (y) the Consolidated Fixed Charge Coverage Ratio of the Issuer would not be less than it was immediately prior to giving effect to such designation, in each case, on a pro forma basis taking into account such designation. |
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(c) Any such designation as an Unrestricted Subsidiary or Restricted Subsidiary by the Issuer’s Board of Directors will be evidenced to the Trustee by filing a resolution of the Issuer’s Board of Directors with the Trustee giving effect to such designation and an Officer’s Certificate certifying that such designation complies with this Section 4.15, and giving the effective date of such designation. Any such filing with the Trustee must occur within 45 days after the end of the Issuer’s fiscal quarter in which such designation is made (or, in the case of a designation made during the last fiscal quarter of the Issuer’s fiscal year, within 90 days after the end of such fiscal year). |
. The Issuer shall pay or discharge and shall cause each of its Subsidiaries to pay or discharge, or cause to be paid or discharged, before the same shall become delinquent (a) all material taxes, assessments and governmental charges levied or imposed upon (i) the Issuer or any such Subsidiary, (ii) the income or profits of any such Subsidiary which is a corporation or (iii) the property of the Issuer or any such Subsidiary and (b) all material lawful claims for labor, materials and supplies that, if unpaid, might by law become a lien upon the property of the Issuer or any such Subsidiary; provided that the Issuer shall not be required to pay or discharge, or cause to be paid or discharged, any such tax, assessment, charge or claim the amount, applicability or validity of which is being contested in good faith by appropriate proceedings or for which adequate reserves have been established.
. So long as any Notes are outstanding, the Issuer shall furnish to the Trustee:
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(a) within 120 days after the end of each of the Issuer’s fiscal years annual reports containing the following information: (a) audited consolidated balance sheets of the Issuer as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Issuer for the two most recent fiscal years, including footnotes to such financial statements and the report of the Issuer’s independent auditors on the financial statements; (b) an operating and financial review of the |
audited financial statements, including a discussion of the results of operations, financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (c) a description of the business and management of the Issuer; and (d) material recent developments to the extent not previously reported; |
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(b) within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Issuer, quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year-to-date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Issuer, together with condensed footnote disclosure; (b) operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Issuer and any material change between the current quarterly period and the corresponding period of the prior year; and (c) material recent developments to the extent not previously reported; and |
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(c) promptly after the occurrence of any material acquisition, disposition or restructuring of the Issuer and the Restricted Subsidiaries, taken as a whole, or any change of the entire Board of Directors, chairman of the Board of Directors, chief executive officer or chief financial officer or change in auditors of the Issuer, a press release containing a description of such event. |
In addition, the Issuer shall furnish to the Holders and to prospective investors, upon the requests of such Holders, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the Exchange Act by Persons who are not “affiliates” under the Securities Act.
The Issuer shall also make available copies of all reports furnished to the Trustee (a) on the website of the ARD Holdings S.A. group of companies and (b) through the newswire service of Bloomberg, or, if Bloomberg does not then operate, any similar agency.
. Upon request of the Trustee or the Security Agent (but without imposing any duty or obligation of any kind on the Trustee or the Security Agent to make any such request), the Issuer shall execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
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(a) In connection with the issuance of any Additional Notes, the Issuer shall take those steps or cause to be taken by any relevant Subsidiary in certain jurisdictions (the “Security Confirmations”) that are taken as a matter of market practice to provide that the Notes then outstanding continue to benefit from the Collateral and the Security Documents and that the Additional Notes will benefit to the extent legally possible from the Collateral and the Security Documents. To the extent any Security Confirmations have not been effected on the date of issuance of the Additional Notes, the Issuer shall use commercially reasonable efforts to effect such Security Confirmations as soon as practicable. |
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(b) Following the Issue Date, if the Issuer acquires the Qualified Capital Stock of another Person (other than a Subsidiary that is promptly designated as an Unrestricted Subsidiary), within thirty (30) days of such acquisition, the Issuer shall grant Liens in the form of share pledges over such Qualified Capital Stock in favor of the Security Agent for the benefit of the Holders. |
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(a) The Issuer may, from time to time, deposit amounts into Escrow Accounts as described under Section 4.08(b)(xv)(ii) and the second paragraph of Section 7(a) of the Notes. The Security Agent, on behalf of the Holders, will have a perfected security interest (subject to any legal and statutory limitations, regulatory restrictions or similar principles) over the Escrow Accounts. Prior to November 15, 2022, the Issuer shall be entitled to |
withdraw amounts from the Escrow Accounts solely (i) to consummate an Escrow Offer (and to pay reasonable fees and expenses in connection with such Escrow Offer), (ii) to the extent such proceeds were previously subject to an Escrow Offer, to purchase Notes by way of optional redemption, tender offer, open market purchases, negotiated transactions or otherwise or any combination thereof (and to pay reasonable fees and expenses in connection therewith) or (iii) upon the release of security over the Escrow Accounts. The Trustee and the Security Agent shall have no obligations or responsibility to monitor the Issuer’s use of the Escrow Accounts. |
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(b) On or within 30 days of November 15, 2022, the Issuer shall withdraw all funds deposited into the Escrow Accounts, which have not been applied to redeem or repurchase Notes or pay fees and expenses, to consummate a mandatory redemption as provided paragraph 6(b) of the Notes. The Security Agent’s Lien on the Escrow Accounts shall be released in accordance with Section 11.04. |
.
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(a) The Issuer shall not, in a single transaction or through a series of transactions, consolidate or merge with or into any other Person or sell, assign, convey, transfer, lease or otherwise dispose of, or take any action pursuant to any resolution passed by the Issuer’s Board of Directors or shareholders with respect to a demerger or division pursuant to which the Issuer would dispose of, all or substantially all of the Issuer’s properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary of the Issuer) to any other Person or Persons and the Issuer shall not permit any Restricted Subsidiary of the Issuer to enter into any such transaction or series of transactions if such transaction or series of transactions, in the aggregate, would result in the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the properties and assets (other than Capital Stock, Debt or other securities of any Unrestricted Subsidiary) of the Issuer and its Restricted Subsidiaries on a consolidated basis to any other Person or Persons. |
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(b) Section 5.01(a) above shall not apply if: |
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(i) at the time of, and immediately after giving effect to, any such transaction or series of transactions, either (x) the Issuer will be the continuing corporation or (y) the Person (if other than the Issuer) formed by or surviving any such consolidation or merger or to which such sale, assignment, conveyance, transfer, lease or disposition of all or substantially all the properties and assets of the Issuer and its Restricted Subsidiaries on a consolidated basis has been made (the “Surviving Entity”): |
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(A) will be a corporation duly incorporated and validly existing under the laws of any member state of the European Union or the European Economic Area, the United States of America, any state thereof, the District of Columbia, Canada, Switzerland, Australia or Bermuda; and |
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(A) will expressly assume, by a supplemental indenture in form satisfactory to the Trustee, the Issuer’s obligations under the Notes, this Indenture and the Security Documents, and the Notes, this Indenture and the Security Documents shall remain in full force and effect as so supplemented; |
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(ii) immediately after giving effect to such transaction or series of transactions on a pro forma basis (and treating any Obligation of the Issuer or any Restricted Subsidiary of the Issuer incurred in connection with or as a result of such transaction or series of transactions as having been incurred by the Issuer or such Restricted Subsidiary at the time of such transaction) no Default or Event of Default will have occurred and be continuing; |
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(iii) immediately before and immediately after giving effect to such transaction or series of transactions on a pro forma basis (on the assumption that the transaction or series of transactions occurred on the first day of the four-quarter fiscal period immediately prior to the consummation of such transaction |
or series of transactions with the appropriate adjustments with respect to the transaction or series of transactions being included in such pro forma calculation), a Permitted Subsidiary could incur at least $1.00 of additional Debt pursuant to Section 4.06(a); |
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(iv) any of the Issuer’s or any of its Restricted Subsidiaries’ property or assets would thereupon become subject to any Lien, the provisions of Section 4.07 are complied with; and |
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(v) the Issuer or the Surviving Entity shall have delivered to the Trustee, in form and substance satisfactory to the Trustee, an Officer’s Certificate (attaching the computations to demonstrate compliance with clause (iii) above) and an opinion of independent counsel, each stating that such consolidation, merger, sale, assignment, conveyance, transfer, lease or other disposition, and if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with the requirements of this Indenture and that this Indenture and the Notes constitute legal, valid and binding obligations of the continuing person, enforceable in accordance with their terms. |
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(c) The Surviving Entity shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture, but, in the case of a lease of all or substantially all of the Issuer’s assets, the Issuer shall not be released from the obligation to pay the principal of, premium, if any, and interest on the Notes. |
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(d) Nothing in this Indenture shall prevent any Restricted Subsidiary of the Issuer from consolidating with, merging into or transferring all or substantially all of its properties and assets to the Issuer or any Restricted Subsidiary of the Issuer. |
The Issuer shall publish a notice of any consolidation, merger or sale of assets described above in accordance with Section 12.02 and, so long as the rules of Euronext Dublin so require, notify such exchange of any such consolidation, merger or sale.
. Upon any consolidation or merger, or any sale, conveyance, transfer, lease or other disposition of all or substantially all of the property and assets of the Issuer in accordance with Section 5.01 of this Indenture any Surviving Entity formed by such consolidation or into which the Issuer is merged or to which such sale, conveyance, transfer, lease or other disposition is made, shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with the same effect as if such Surviving Entity had been named as the Issuer herein; provided that the Issuer shall not be released from its obligation to pay the principal of, premium, if any, or interest and Additional Amounts, if any, on the Notes in the case of a lease of all or substantially all of its property and assets.
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(a) “Event of Default,” wherever used herein, means any of the following events: |
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(i) a default for 30 days in the payment when due of any interest or any Additional Amounts on any Note; or |
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(ii) default in the payment of the principal of or premium, if any, on any Note at its Maturity (upon acceleration, optional or mandatory redemption, if any, required repurchase or otherwise); or |
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(iii) failure to comply with the provisions of Article Five; or |
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(iv) failure to comply with any covenant or agreement of the Issuer or of any Restricted Subsidiary of the Issuer that is contained herein (other than specified in clause (i), (ii) or (iii)) above) and |
such failure continues for a period of 60 days or more, in each case after the written notice specified in Section 6.02(a) below; or |
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(v) default under the terms of any instrument evidencing or securing the Debt of the Issuer or any Restricted Subsidiary of the Issuer having an outstanding principal amount in excess of (i) for so long as the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets, in each case, individually or in the aggregate, if that default: (x) results in the acceleration of the payment of such Debt or (y) is caused by the failure to pay such Debt at final maturity thereof after giving effect to the expiration of any applicable grace periods and other than by regularly scheduled required prepayment, and such failure to make any payment has not been waived or the maturity of such Debt has not been extended, and in either case the total amount of such Debt unpaid or accelerated exceeds (i) for so long as the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time; or |
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(vi) the Security Interests purported to be created under any Security Document will, at any time, cease to be in full force and effect and constitute a valid and perfected Lien with the priority required by the applicable Security Document for any reason other than the satisfaction in full of all obligations under this Indenture and discharge of this Indenture or any Security Interest purported to be created thereunder is declared invalid or unenforceable or the Issuer granting Collateral the subject of any such Security Interest asserts, in any pleading in any court of competent jurisdiction, that any such Security Interest is invalid or unenforceable and (but only in the event that such failure to be in full force and effect or such assertion is capable of being cured without imposing any new hardening period, in equity or at law, that such Security Interest was not otherwise subject immediately prior to such failure or assertion) such failure to be in full force and effect or such assertion has continued uncured for a period of 15 days; or |
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(vii) one or more final judgments, orders or decrees (not subject to appeal and not covered by insurance or indemnities) shall be rendered against the Issuer or any Material Subsidiary of the Issuer, either individually or in an aggregate amount, in excess of (i) for so long as the Existing Ardagh Bonds remain outstanding, €75,000,000 and (ii) thereafter, the greater of $200,000,000 and 2.75% of Total Assets or its equivalent at the time, and either a creditor shall have commenced an enforcement proceeding upon such judgment, order or decree or there shall have been a period of 60 consecutive days or more during which a stay of enforcement of such judgment, order or decree was not (by reason of pending appeal or otherwise) in effect; or |
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(viii) the entry by a court of competent jurisdiction of (A) a decree or order for relief in respect of the Issuer or any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or (B) a decree or order adjudging the Issuer or any Material Subsidiary bankrupt or insolvent, or seeking reorganization, arrangement, adjustment or composition of or in respect of the Issuer or any Material Subsidiary under any applicable law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Issuer or any Material Subsidiary or of any substantial part of their respective properties or ordering the winding up or liquidation of their affairs, and any such decree, order or appointment pursuant to any Bankruptcy Law for relief shall continue to be in effect, or any such other decree, appointment or order shall be unstayed and in effect, for a period of 100 consecutive days; or |
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(ix) (A) the Issuer or any Material Subsidiary (x) commences a voluntary case or proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent or (y) consents to the filing of a petition, application, answer or consent seeking reorganization or relief under any applicable Bankruptcy Law, (B) the Issuer or any Material Subsidiary consents to the entry of a decree or order for relief in respect of the Issuer or such Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it or, (C) the Issuer or any Material Subsidiary (x) consents to the appointment of, or taking possession by, a custodian, receiver, liquidator, administrator, supervisor, assignee, trustee, sequestrator or similar official of the Issuer or such Material Subsidiary or of any substantial part of their respective properties, (y) makes an assignment for the benefit of creditors or (z) admits in writing its inability to pay its debts generally as they become due. |
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(b) If a Default or an Event of Default occurs and is continuing and is known to a responsible officer of the Trustee, the Trustee will mail to each Holder notice of the Default or Event of Default within 15 Business Days after its occurrence by registered or certified mail or facsimile transmission of an Officer’s Certificate specifying such event, notice or other action, its status and what action the Issuer is taking or proposes to take with respect thereto. Except in the case of a Default or an Event of Default in payment of principal of, premium, if any, and Additional Amounts or interest on any Notes, the Trustee may withhold the notice to the Holders of such Notes if its Trust Officers in good faith determine that withholding the notice is in the interests of the Holders. The Trustee shall not be deemed to have knowledge of a Default unless a Trust Officer has actual knowledge of such Default. The Issuer shall also notify the Trustee within 15 Business Days of the occurrence of any Default stating what action, if any, they are taking with respect to that Default. |
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(a) If an Event of Default with respect to the Notes (other than an Event of Default specified in Section 6.01(a)(viii) or (ix) above) occurs and is continuing, the Trustee or the Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuer (and to the Trustee if such notice is given by the Holders) may, and the Trustee, upon the written request of such Holders shall, declare the principal amount of, premium, if any, and any Additional Amounts and accrued interest on all of the outstanding Notes immediately due and payable, and upon any such declaration all such amounts payable in respect of the Notes shall become immediately due and payable. |
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(b) If an Event of Default specified in Section 6.01(a)(viii) or (ix) above occurs and is continuing, then the principal amount of, premium, if any, and Additional Amounts and accrued and unpaid interest on all of the outstanding Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. |
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(c) At any time after a declaration of acceleration under this Indenture, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in aggregate principal amount of the outstanding Notes, by written notice to the Issuer and the Trustee, may rescind such declaration and its consequences if: |
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(i) the Issuer has paid or deposited with the Trustee a sum sufficient to pay: |
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(A) all overdue interest and Additional Amounts on all Notes then outstanding; |
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(A) all unpaid principal of and premium, if any, on any outstanding Notes that have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Notes; |
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(A) to the extent that payment of such interest is lawful, interest upon overdue interest and overdue principal at the rate borne by the Notes; and |
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(A) all sums paid or advanced by the Trustee under this Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; |
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(ii) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and |
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(iii) all Events of Default, other than the non-payment of amounts of principal of, premium, if any, and any Additional Amounts and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 6.04. |
No such rescission shall affect any subsequent default or impair any right consequent thereon.
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(d) In the event of a declaration of acceleration of the Notes because an Event of Default as described in Section 6.01(a)(v) has occurred and is continuing, the declaration of acceleration of the Notes shall be automatically annulled if the event of default or payment default triggering such Event of Default pursuant to Section 6.01(a)(v) shall be remedied or cured, or waived by the holders of the Debt that gave rise to such Event of Default, or such Debt shall have been discharged in full, within 20 days after the Event of Default arose and if (1) the annulment of the acceleration (if applicable) of the Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, except nonpayment of principal, premium or interest, including Additional Amounts, if any, on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived. |
. If an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy. Subject to the terms of the Security Documents, the Trustee may direct the Security Agent to take enforcement action with respect to the Collateral if any amount is declared or becomes due and payable pursuant to Section 6.02 (but not otherwise).
All rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee, and all rights of action and claims under the Security Documents may be prosecuted or enforced under the Security Documents by the Security Agent (in consultation with the Trustee, where appropriate), without the possession of any of the Notes or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee or the Security Agent shall be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee or the Security Agent, their agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.
. The Holders of not less than a majority in aggregate principal amount of the outstanding Notes may, by written notice to the Trustee, on behalf of the Holders of all the Notes, waive any past Default hereunder and its consequences, except a Default:
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(a) in the payment of the principal of, premium, if any, Additional Amounts, if any, or interest on any Note; or |
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(b) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holders of 90% of the outstanding Notes. |
Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
. The Holders of a majority in aggregate principal amount of the Notes may 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 under this Indenture; provided that:
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(a) the Trustee may refuse to follow any direction that conflicts with law, this Indenture or that the Trustee determines, without obligation, in good faith may be unduly prejudicial to the rights of Holders not joining in the giving of such direction; |
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(b) the Trustee may refuse to follow any direction that the Trustee determines is unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability; and |
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(c) the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. |
. No Holder of any of the Notes has any right to institute any proceedings with respect to this Indenture or any remedy hereunder, unless the Holders of at least 30% in aggregate principal amount of the outstanding Notes have made a written request to, and offered indemnity and/or security (including by way of pre‑funding) reasonably satisfactory to, the Trustee to institute such proceeding as trustee under the Notes and this Indenture, the Trustee has failed to institute such proceeding within 30 days after receipt of such notice and indemnity or security and the Trustee within such 30‑day period has not received directions inconsistent with such written request by holders of a majority in aggregate principal amount of the outstanding Notes. Such limitations do not, however, apply to a suit instituted by a Holder for the enforcement of the payment of the principal of, premium, if any, and Additional Amounts or interest on such Note on or after the respective due dates expressed in such Note.
A Holder may not use this Indenture to prejudice the rights of any other Holder or to obtain a preference or priority over another Holder.
. Notwithstanding any other provision of this Indenture, the right of any Holder to bring suit for the enforcement of payment of principal, premium, if any, Additional Amounts, if any, and interest, if any, on the Notes held by such Holder, on or after the respective due dates expressed in the Notes shall not be impaired or affected without the consent of such Holder.
. The Issuer covenants that if default is made in the payment of:
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(a) any installment of interest on any Note when such interest becomes due and payable and such default continues for a period of 30 days, or |
the Issuer shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Notes, the whole amount then due and payable on such Notes for principal (and premium, if any), Additional Amounts, if any and interest, and interest on any overdue principal (and premium, if any) and Additional Amounts, if any and, to the extent that payment of such interest shall be legally enforceable, upon any overdue installment of interest, at the rate borne by the Notes, and, in addition thereto, such further amount as shall be sufficient to cover the amounts provided for in Section 7.05 and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Issuer fails to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuer or any other obligor upon the Notes and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Issuer or any other obligor upon the Notes, wherever situated.
. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the properly incurred compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.05) and the Holders allowed in any judicial proceedings relative to the Issuer, its creditors or its property and, unless prohibited by law or applicable regulations, may vote on behalf of the Holders at their direction in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the properly incurred compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.05. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due to the Trustee under Section 7.05 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money securities and other properties which
the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise.
Nothing herein contained shall be deemed to empower the Trustee to authorize or consent to, or accept or adopt on behalf of any Holder, any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
. If the Trustee collects any money or property pursuant to this Article Six or proceeds from the sale of Collateral, it shall pay out the money or property in the following order:
FIRST: to the Trustee, any Agent, and the Security Agent for amounts due under Section 7.05;
SECOND: to Holders for amounts due and unpaid on the Notes for principal of, premium, if any, interest, if any, and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, interest, if any, and Additional Amounts, if any, respectively; and
THIRD: to the Issuer or any other obligors of the Notes, as their interests may appear, or as a court of competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 30 days before such record date, the Issuer shall mail to each Holder and the Trustee a notice that states the record date, the payment date and amount to be paid. This Section 6.10 is subject at all times to the provisions set forth in Section 11.02.
The Security Agent shall apply the proceeds of the Collateral as in accordance with this Section 6.10.
. A court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee or the Security Agent for any action taken or omitted by it as Trustee or as the Security Agent, the filing by any party litigant in the suit of an undertaking to pay the costs of such suit, and such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee or the Security Agent, a suit by Holders of more than 10% in aggregate principal amount of the outstanding Notes or to any suit by any Holder pursuant to Section 6.07.
. If the Trustee or the Security Agent or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or the Security Agent or to such Holder, then and in every such case, subject to any determination in such proceeding, the Issuer, the Trustee, the Security Agent and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee, the Security Agent and the Holders shall continue as though no such proceeding had been instituted.
. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes in Section 2.07, no right or remedy herein conferred upon or reserved to the Trustee, or the Security Agent or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
. No delay or omission of the Trustee, or the Security Agent or of any Holder of any Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article Six or by law to the Trustee, or the Security Agent or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
. The Issuer may set a record date for purposes of determining the identity of Holders entitled to vote or to consent to any action by vote or consent authorized or permitted by Sections 6.04 and 6.05. Unless this Indenture provides otherwise, such record date shall be the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished to the Trustee pursuant to Section 2.05 prior to such solicitation.
. The Issuer covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it shall not hinder, delay or impede the execution of any power herein granted to the Trustee or to the Security Agent, but shall suffer and permit the execution of every such power as though no such law had been enacted.
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(a) If an Event of Default has occurred and is continuing of which a Trust Officer of the Trustee or the Security Agent has actual knowledge, the Trustee or the Security Agent shall exercise such of the rights and powers vested in it by this Indenture and the Security Documents and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs; |
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(b) Subject to the provisions of Section 7.01(a), (i) the Trustee and the Security Agent undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and the Security Documents and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee and the Security Agent; and (ii) in the absence of bad faith on its part, the Trustee and the Security Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and the Security Agent and conforming to the requirements of this Indenture and the Security Documents. In the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee or the Security Agent, the Trustee and the Security Agent, as applicable, shall examine same to determine whether they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); |
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(c) The Security Agent shall execute and deliver, if necessary, and act as beneficiary under, the Security Documents on behalf of the Holders under this Indenture and shall take such other actions as may be necessary or advisable in accordance with the Security Documents. The Security Agent shall remit any proceeds recovered from enforcement of the Security Documents; provided that all necessary approvals are obtained from each relevant jurisdiction in which the Collateral is located. |
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(d) Neither the Trustee nor the Security Agent shall be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: |
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(i) this paragraph does not limit the effect of paragraph (b) of this Section 7.01; |
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(ii) the Trustee and the Security Agent shall not be liable for any error of judgment made in good faith by a Trust Officer of the Trustee or the Security Agent unless it is proved that the Trustee or the Security Agent was negligent in ascertaining the pertinent facts; and |
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(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.02 or 6.05; |
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(e) The Trustee, any Paying Agent and the Security Agent shall not be liable for interest on any money received by it except as the Trustee, any Paying Agent and the Security Agent may agree in writing with the Issuer. Money held in trust by the Trustee, the Principal Paying Agent or the Security Agent need not be segregated from other funds except to the extent required by law and, for the avoidance of doubt, shall not be held in accordance with the UK Client Money Rules; |
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(f) No provision of this Indenture or the Security Documents shall require the Trustee, each Agent, the Principal Paying Agent or the Security Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not assured to it; and |
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(g) Any provisions hereof or of the Security Documents relating to the conduct or affecting the liability of or affording protection to the Trustee, each Agent, or the Security Agent, as the case may be, shall be subject to the provisions of this Section 7.01. |
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(a) Subject to Section 7.01: |
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(i) following the occurrence of a Default or an Event of Default, the Trustee is entitled to require all Agents to act under its direction; |
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(iii) before the Trustee or the Security Agent act or refrain from acting, they may require an Officer’s Certificate or an Opinion of Counsel or both, which shall conform to Section 12.04. Neither the Trustee nor the Security Agent shall be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion and such certificate or opinion will be equal to complete authorization; |
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(iv) the Trustee and the Security Agent may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care by it hereunder; |
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(v) neither the Trustee nor the Security Agent shall be under any obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee and the Security Agent security and/or indemnity (including by way of pre-funding) satisfactory to them against the costs, expenses and liabilities that might be incurred by them in compliance with such request or direction; |
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(vi) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Issuer will be sufficient if signed by an officer of the Issuer; |
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(vii) neither the Trustee nor the Security Agent shall be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; |
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(viii) whenever, in the administration of this Indenture and the Security Documents, the Trustee and the Security Agent shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee and the Security Agent (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate; |
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(ix) neither the Trustee nor the Security Agent shall be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee and the Security Agent, in their discretion, individually, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee or the Security Agent shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuer personally or by agent or attorney; |
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(x) neither the Trustee nor the Security Agent shall be required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture; |
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(xi) in the event the Trustee or the Security Agent receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal amount of the Notes then outstanding, pursuant to the provisions of this Indenture the Trustee and the Security Agent, in their discretion, may determine what action, if any, will be taken; |
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(xii) the permissive rights of the Trustee and the Security Agent to take the actions permitted by this Indenture will not be construed as an obligation or duty to do so; |
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(xiii) delivery of reports, information and documents to the Trustee under Section 4.19 is for informational purposes only and the Trustee’s receipt of the foregoing will not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Issuer’s or any of its Restricted Subsidiary’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates); |
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(xiv) the rights, privileges, protections, immunities and benefits given to each of the Trustee and the Security Agent in this Indenture including, without limitation, its rights to be indemnified and compensated, are extended to, and will be enforceable by, the Trustee and the Security Agent in each of their capacities hereunder, by the Registrar, the Agents, and each agent, custodian and other Person employed to act hereunder; |
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(xv) the Trustee and the Security Agent may consult with counsel and the advice of such counsel or any Opinion of Counsel will, subject to Section 7.01(c), be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; |
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(xvi) the Trustee and the Security Agent shall have no duty to inquire as to the performance of the covenants of the Issuer and/or its Restricted Subsidiaries in Article Four hereof; |
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(xvii) the Trustee and the Security Agent shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Indenture or under applicable law or regulation with respect to any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Notes, but may at its sole discretion, choose to do so; |
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(xviii) in no event shall the Trustee or the Security Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of, or caused by, directly or indirectly, forces beyond its control, including, without limitation, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances; and |
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(xix) neither the Trustee nor the Security Agent shall under any circumstance be liable for any consequential loss or punitive damages (including loss of business, goodwill, opportunity or profit of any kind) of the Issuer or any of its Restricted Subsidiary. |
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(b) The Trustee and the Security Agent may request that the Issuer deliver an Officer’s Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. |
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(c) The Security Agent shall accept without investigation, requisition or objection such right and title as the Issuer may have to any of the Collateral and shall not be bound or concerned to examine or enquire into or be liable for any defect or failure in the right or title of the Issuer to the Collateral or any part thereof whether such defect or failure was known to the Security Agent or might have been discovered upon examination or enquiry and whether capable of remedy or not and shall have no responsibility for the validity, value or sufficiency of the Collateral. |
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(d) Without prejudice to the provisions hereof, the Security Agent shall not be under any obligation to insure any of the Collateral or any certificate, note, bond or other evidence in respect thereof, or to require any other person to maintain any such insurance and shall not be responsible for any loss, expense or liability which may be suffered as a result of any assets comprised in the Collateral being uninsured or inadequately insured. |
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(e) The Security Agent shall not be responsible for any loss, expense or liability occasioned to the Collateral, howsoever caused, by the Security Agent or by any act or omission on the part of any other person (including any bank, broker, depositary, warehouseman or other intermediary or by any clearing system or other operator thereof), or otherwise, unless such loss is occasioned by the willful misconduct or fraud of the Security Agent. |
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(f) Beyond the exercise of reasonable care in the custody thereof, the Security Agent shall have no duty or liability as to any Collateral in its possession or control or in the possession or control of any agent or bailee or any income thereon or as to preservation of rights against prior parties or any other rights pertaining thereto and the Security Agent shall not be responsible for filing any financing or continuation statements or recording any documents or instruments in any public office at any time or times or otherwise perfecting or maintaining the perfection of any security interest in the Collateral. The Security Agent shall be deemed to have exercised reasonable care in the custody of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which it accords its own property and shall not be liable or responsible for any loss or diminution in the value of any of the Collateral by reason of the act or omission of any carrier, forwarding agency or other agent or bailee selected by the Security Agent in good faith. |
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(g) Neither the Trustee nor the Security Agent is required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture or the Notes. |
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(h) Neither the Trustee nor the Security Agent will be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control. |
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(i) Notwithstanding anything else herein contained, the Trustee and Agents may refrain without liability from doing anything that would or might in its opinion be contrary to any law of any state or jurisdiction |
(including but not limited to include the European Union and the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may without liability do anything which is, in its opinion, necessary to comply with any such law, directive or regulation. |
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(j) The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York. |
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(k) Both the Trustee and the Security Agent may assume without inquiry in the absence of actual knowledge that the Issuer is duly complying with its obligations contained in this Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Notes has occurred. |
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(l) At any time that the security granted pursuant to the Security Documents has become enforceable and the Holders have given a direction to the Trustee to enforce such security, the Trustee is not required to give any direction to the Security Agent with respect thereto unless it has been indemnified and/or secured to its satisfaction in accordance with this Indenture. In any event, in connection with any enforcement of such security, the Trustee is not responsible for: |
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(i) any failure of the Security Agent to enforce such security within a reasonable time or at all; |
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(ii) any failure of the Security Agent to pay over the proceeds of enforcement of the security; |
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(iii) any failure of the Security Agent to realize such security for the best price obtainable; |
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(iv) monitoring the activities of the Security Agent in relation to such enforcement; |
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(v) taking any enforcement action itself in relation to such security; |
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(vi) agreeing to any proposed course of action by the Security Agent which could result in the Trustee incurring any liability for its own account; or |
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(vii) paying any fees, costs or expenses of the Security Agent. |
. The Trustee, the Security Agent, any Transfer Agent, any Paying Agent, any Registrar or any other agent of the Issuer or of the Trustee or Security Agent, in its individual or any other capacity, may become the owner or pledgee of Notes and, may otherwise deal with the Issuer with the same rights it would have if it were not Trustee, the Security Agent, Paying Agent, Transfer Agent, Registrar or such other agent. The Trustee and the Security Agent may accept deposits from, lend money to, and generally engage in any kind of banking, trust or other business with the Issuer or any of its Affiliates or Subsidiaries as if it were not performing the duties specified herein and in the Security Documents, and may accept fees and other consideration from the Issuer for services in connection with this Indenture and otherwise without having to account for the same to the Trustee, the Security Agent or to the Holders from time to time.
. The recitals contained herein and in the Notes, except for the Trustee’s certificates of authentication, shall be taken as the statements of the Issuer, and the Trustee assumes no responsibility for their correctness. The Trustee and the Security Agent make no representations as to the validity or sufficiency of this Indenture the Notes or the Security Documents, except that the Trustee represents that it is duly authorized to execute and deliver this Indenture and to authenticate the Notes and the Security Agent represents that it is duly authorized to execute and deliver this Indenture and the Security Documents. The Trustee and the Security Agent shall not be accountable for the Issuer’s use of the proceeds from the Notes or any money paid to the Issuer or upon the Issuer’s direction under any provision of this Indenture nor shall it be responsible for the use or application of any money received by any Paying Agent other than the Trustee
and the Security Agent. The Security Agent shall not nor shall any receiver appointed by or any agent of the Security Agent, by reason of taking possession of any Collateral or any part thereof or any other reason or on any basis whatsoever, be liable to account for anything expect actual receipts or be liable for any loss or damage arising from a realization of the Collateral or any part thereof or from any act, default or omission in relation to the Collateral or any part thereof or from any exercise or non-exercise by it of any power, authority or discretion conferred upon it in relation to the Collateral or any part thereof unless such loss or damage shall be caused by its own fraud or negligence. The Security Agent shall not have any responsibility or liability arising from the fact that the Collateral may be held in safe custody by a custodian. The Security Agent assumes no responsibility for the validity, sufficiency or enforceability (which the Security Agent has not investigated) of the Collateral purported to be created by any supplemental indenture or other document. In addition, the Security Agent has no duty to monitor the performance by the Issuer of its obligations to the Security Agent nor is it obliged (unless indemnified and/or secured (including by way of prefunding to its satisfaction) to take any other action which may involve the Security Agent in any personal liability or expense.
. The Issuer shall pay to the Trustee and the Security Agent such compensation as shall be agreed in writing for their services hereunder. The Trustee’s and the Security Agent’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuer shall reimburse the Trustee and the Security Agent promptly upon request for all properly incurred disbursements, advances or expenses incurred or made by them, including costs of collection, in addition to the compensation for their services. Such expenses shall include the properly incurred compensation, disbursements, advances and expenses of the Trustee’s and the Security Agent’s agents and counsel.
The Issuer shall indemnify the Trustee and the Security Agent against any and all loss, liability or expense (including attorneys’ fees and expenses) incurred by either of them without willful misconduct or negligence on their part arising out of or in connection with the administration of this trust and the performance of their duties hereunder (including the costs and expenses of enforcing this Indenture and the Security Documents against the Issuer (including this Section 7.05) and defending themselves against any claim, whether asserted by the Issuer, any Holder or any other Person, or liability in connection with the execution and performance of any of their powers and duties hereunder). The Trustee and the Security Agent shall notify the Issuer promptly of any claim for which they may seek indemnity. Failure by the Trustee or the Security Agent to so notify the Issuer shall not relieve the Issuer of its obligations hereunder. The Issuer shall, at the sole discretion of the Trustee or Security Agent, as applicable, defend the claim and the Trustee and the Security Agent may cooperate and may participate at the Issuer’s expense in such defense. Alternatively, the Trustee and the Security Agent may at their option have separate counsel of their own choosing and the Issuer shall pay the properly incurred fees and expenses of such counsel. The Issuer need not pay for any settlement made without its consent, which consent may not be unreasonably withheld. The Issuer shall not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.
To secure the Issuer’s payment obligations in this Section 7.05, the Trustee and the Security Agent shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, in their capacity as Trustee and the Security Agent, except money or property, including any proceeds from the sale of Collateral, held in trust to pay principal of, premium, if any, additional amounts, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of all Notes under this Indenture.
When either the Trustee or the Security Agent incur expenses after the occurrence of a Default specified in Section 6.01(a)(viii) or (ix) with respect to the Issuer or any Restricted Subsidiary of the Issuer, the expenses are intended to constitute expenses of administration under Bankruptcy Law.
The Issuer’s obligations under this Section 7.05 and any claim or Lien arising hereunder shall survive the resignation or removal of any Trustee and the Security Agent, the satisfaction and discharge of the Issuer’s obligations pursuant to Article Eight and any rejection or termination under any Bankruptcy Law, and the termination of this Indenture.
. A resignation or removal of the Trustee and the Security Agent and appointment of a successor Trustee and successor Security Agent shall become effective
only upon the successor Trustee’s and the successor Security Agent’s acceptance of appointment as provided in this Section 7.06.
The Trustee and, subject to the appointment and acceptance of a successor Security Agent as provided in this Section and the last paragraph of this Section 7.06, the Security Agent may resign at any time without giving any reason by so notifying the Issuer. The Holders of a majority in outstanding principal amount of the outstanding Notes may remove the Trustee and the Security Agent by so notifying the Trustee, the Security Agent and the Issuer. The Issuer shall remove the Trustee if:
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(c) a receiver or other public officer takes charge of the Trustee or the Security Agent or their property; or |
If the Trustee or the Security Agent resigns or is removed, or if a vacancy exists in the office of Trustee or the Security Agent for any reason, the Issuer shall promptly appoint a successor Trustee or a successor Security Agent, as the case may be. Within one year after the successor Trustee or Security Agent takes office, the Holders of a majority in principal amount of the outstanding Notes may appoint a successor Trustee or Security Agent to replace the successor Trustee or Security Agent appointed by the Issuer. If the successor Trustee or Security Agent does not deliver its written acceptance required by the next succeeding paragraph of this Section 7.06 within 30 days after the retiring Trustee or Security Agent resigns or is removed, the retiring Trustee or Security Agent, the Issuer or the Holders of a majority in principal amount of the outstanding Notes may, at the expense of the Issuer, petition any court of competent jurisdiction for the appointment of a successor Trustee or Security Agent.
A successor Trustee or Security Agent shall deliver a written acceptance of its appointment to the retiring Trustee or Security Agent, as the case may be, and to the Issuer. Thereupon the resignation or removal of the retiring Trustee or Security Agent shall become effective, and the successor Trustee or Security Agent shall have all the rights, powers and duties of the Trustee or the Security Agent under this Indenture. The successor Trustee or Security Agent shall mail a notice of its succession to Holders. The retiring Trustee or Security Agent shall promptly transfer all property held by it as Trustee or Security Agent to the successor Trustee or Security Agent; provided that all sums owing to the Trustee or Security Agent hereunder have been paid and subject to the Lien provided for in Section 7.05.
If a successor Trustee or Security Agent does not take office within 60 days after the retiring Trustee or Security Agent resigns or is removed, the retiring Trustee or Security Agent, the Issuer or the Holders of at least 30% in outstanding principal amount of the Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee or Security Agent at the expense of the Issuer. Without prejudice to the right of the Issuer to appoint a successor Trustee or a successor Security Agent in accordance with the provisions of this Indenture the retiring Trustee or Security Agent may appoint a successor Trustee or Security Agent at any time prior to the date on which a successor Trustee or Security Agent takes office.
If the Trustee or the Security Agent fails to comply with Section 7.09, any Holder who has been a bona fide Holder of a Note for at least six months may petition any court of competent jurisdiction for the removal of the Trustee or the Security Agent and the appointment of a successor Trustee or Security Agent.
In addition to the foregoing and notwithstanding any provision to the contrary, any resignation, removal or replacement of the Security Agent pursuant to this Section 7.06 shall not be effective until (a) a successor to the Security Agent has agreed to act under the terms of this Indenture and (b) all of the Security Interests in the Collateral has been transferred to such successor. Any replacement or successor Security Agent shall be a bank with an office in New York, New York or London, England, or an Affiliate of any such bank. Upon acceptance of its appointment as Security Agent hereunder by a replacement or successor, such replacement or successor shall
succeed to and become vested with all the rights, powers, privileges and duties of the retiring Security Agent hereunder, and the retiring Security Agent shall be discharged from its duties and obligations hereunder.
Notwithstanding the replacement of the Trustee or the Security Agent pursuant to this Section 7.06, the Issuer’s obligations under Section 7.05 shall continue for the benefit of the retiring Trustee or Security Agent.
. Any corporation into which the Trustee or the Security Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee or the Security Agent shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee or the Security Agent, shall be the successor of the Trustee or the Security Agent hereunder; provided such corporation shall be otherwise qualified and eligible under this Article Seven, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Notes shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Notes so authenticated with the same effect as if such successor Trustee had itself authenticated such Notes. In case at that time any of the Notes shall not have been authenticated, any successor Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and effect which this Indenture provides for the certificate of authentication of the Trustee shall have; provided that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Notes in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation.
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(a) The Security Agent may perform any of its duties and exercise any of its rights and powers through one or more sub-agents or co-trustees appointed by it. The Security Agent and any such sub-agent or co-trustee may perform any of its duties and exercise any of its rights and powers through its affiliates. All of the provisions of this Indenture applicable to the Security Agent (other than covenants and obligations relating to the Parallel Debt) including, without limitation, its rights to be indemnified, shall apply to and be enforceable by any such sub-agent and affiliates of a Security Agent and any such sub-agent or co-trustee. All references herein to a “Security Agent” (other than covenants and obligations relating to the Parallel Debt) shall include any such sub-agent or co-trustee and affiliates of a Security Agent or any such sub-agent or co-trustee. |
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(b) It is the purpose of this Indenture and the Security Documents that there shall be no violation of any Law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as agent or trustee in such jurisdiction. Without limiting paragraph (a) of this Section 7.08, it is recognized that in case of litigation under, or enforcement of, this Indenture or any of the Security Documents, or in case the Security Agent deems that by reason of any present or future law of any jurisdiction it may not exercise any of the rights, powers or remedies granted herein or in any of the Security Documents or take any other action which may be desirable or necessary in connection therewith, the Security Agent is hereby authorized to appoint an additional individual or institution selected by the Security Agent in its sole discretion as a separate trustee, co-trustee, administrative agent, Security Agent, administrative sub-agent or administrative so-agent (any such additional individual or institution being referred to herein individually as a “Supplemental Security Agent” and collectively as “Supplemental Security Agents”). |
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(c) In the event that the Security Agent appoints a Supplemental Security Agent with respect to any Collateral, (i) each and every right, power, privilege or duty expressed or intended by this Indenture or any of the other Security Documents (other than the rights arising in respect of the Parallel Debts under Section 11.05) to be exercised by or vested in or conveyed to such Security Agent with respect to such Collateral shall be exercisable by and vest in such Supplemental Security Agent to the extent, and only to the extent, necessary to enable such Supplemental Security Agent to exercise such rights, powers and |
privileges with respect to such Collateral and to perform such duties with respect to such Collateral, and every covenant and obligation contained in the Security Documents and necessary to the exercise or performance thereof by such Supplemental Security Agent (other than covenants and obligations relating to the Parallel Debt) shall run to and be enforceable by either such Security Agent or such Supplemental Security Agent, and (ii) the provisions of this Indenture (and, in particular, this Article Seven) that refer to the Security Agent shall inure to the benefit of such Supplemental Security Agent and all references therein to the Security Agent shall be deemed to be references to a Security Agent and/or such Supplemental Security Agent, as the context may require. |
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(d) Should any instrument in writing from the Issuer or any other obligor be required by any Supplemental Security Agent so appointed by the Security Agent for more fully and certainly vesting in and confirming to him or it such rights, powers, privileges and duties, the Issuer shall execute, acknowledge and deliver any and all such instruments promptly upon request by the Security Agent. In case any Supplemental Security Agent, or a successor thereto, shall die, become incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such Supplemental Security Agent, to the extent permitted by Law, shall vest in and be exercised by the Security Agent until the appointment of a new Supplemental Security Agent. |
. There will at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of England and Wales or the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power and which is generally recognized as a corporation which customarily performs such corporate trustee roles and provides such corporate trustee services in transactions similar in nature to the offering of the Notes as described in the Offering Memorandum.
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(a) It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture, and in particular in case of the enforcement thereof on Default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Trustee or hold title to the properties, in trust, as herein granted or take any action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an individual or institution as a separate or co-trustee. The following provisions of this Section 7.10 are adopted to these ends. |
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(b) In the event that the Trustee appoints an additional individual or institution as a separate or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and Lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co-trustee but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and only to the extent that the Trustee by the laws of any jurisdiction is incapable of exercising such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of them. |
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(c) Should any instrument in writing from the Issuer be required by the separate or co-trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to him or it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall to the extent permitted by the laws of the State of New York and the jurisdiction of organization of the Issuer, on request, be executed, acknowledged and delivered by the Issuer; provided that if an Event of Default shall have occurred and be continuing, if the Issuer does not execute any such instrument within 15 days after request therefor, the Trustee shall be empowered as an attorney-in-fact for the Issuer to execute any such instrument in the Issuer’s name and stead. In case any separate or co-trustee or a successor to either shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate or co-trustee. |
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(d) Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: |
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(i) all rights and powers, conferred or imposed upon the Trustee shall be conferred or imposed upon and may be exercised or performed by such separate trustee or co-trustee; and |
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(ii) no trustee hereunder shall be liable by reason of any act or omission of any other trustee hereunder. |
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(e) Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article Seven. |
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(f) Any separate trustee or co-trustee may at any time appoint the Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successors trustee. |
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(a) Any Agent may resign its appointment hereunder at any time without the need to give any reason and without being responsible for any costs associated therewith by giving to the Issuer and the Trustee and (except in the case of resignation of the Principal Paying Agent) the Principal Paying Agent 30 days’ written notice to that effect (waivable by the Issuer and the Trustee); provided that in the case of resignation of the Principal Paying Agent no such resignation shall take effect until a new Principal Paying Agent (approved in advance in writing by the Trustee) shall have been appointed by the Issuer to exercise the powers and undertake the duties hereby conferred and imposed upon the Principal Paying Agent. Following receipt of a notice of resignation from any Agent, the Issuer shall promptly give notice thereof to the Holders in accordance with Section 12.02. Such notice shall expire at least 30 days before or after any due date for payment in respect of the Notes. |
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(b) If any Agent gives notice of its resignation in accordance with this Section 7.11 and a replacement Agent is required and by the tenth day before the expiration of such notice such replacement has not been duly appointed, such Agent may itself appoint as its replacement any reputable and experienced financial institution. Immediately following such appointment, the Issuer shall give notice of such appointment to the Trustee, the remaining Agents and the Holders whereupon the Issuer, the Trustee, the remaining Agents and the replacement Agent shall acquire and become subject to the same rights and obligations between themselves as if they had entered into an agreement in the form mutatis mutandis of this Indenture. |
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(c) Upon its resignation becoming effective the Principal Paying Agent shall forthwith transfer all moneys held by it hereunder hereof to the successor Principal Paying Agent or, if none, the Trustee or to the Trustee’s order, but shall have no other duties or responsibilities hereunder, and shall be entitled to the payment by the Issuer of its remuneration for the services previously rendered hereunder and to the reimbursement of all reasonable expenses (including legal fees) incurred in connection therewith. |
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(a) Actions of Agents. The rights, powers, duties and obligations and actions of each Agent under this Indenture are several and not joint or joint and several. |
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(b) Agents of Trustee. The Issuer and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuer and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee. Prior to receiving such written notification from the Trustee, the Agents shall be the agents of the Issuer and need have no concern for the interests of the Holders. |
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(c) Funds held by Agents. The Agents will hold all funds as banker subject to the terms of this Indenture and as a result, such money will not be held in accordance with the rules established by the Financial Conduct Authority in the Financial Conduct Authority’s Handbook of rules and guidance from time to time in relation to client money. |
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(d) Publication of Notices. Any obligation the Agents may have to publish a notice to Holders of Global Notes on behalf of the Issuer will be met upon delivery of the notice to DTC, Euroclear and/or Clearstream. |
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(e) Instructions. In the event that instructions given to any Agent are not reasonably clear, then such Agent shall be entitled to seek clarification from the Issuer or other party entitled to give the Agents instructions under this Indenture by written request promptly, and in any event within one Business Day of receipt by such Agent of such instructions. If an Agent has sought clarification in accordance with this Section 7.12, then such Agent shall be entitled to take no action until such clarification is provided, and shall not incur any liability for not taking any action pending receipt of such clarification. |
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(f) No Fiduciary Duty. No Agent shall be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust, for or with any person other than the Issuer. |
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(g) Mutual Undertaking. Each Party shall, within ten Business Days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this Section 7.12(g) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality. For purposes of this Section 7.12(g), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature. |
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(h) Tax Withholding. |
The Issuer shall notify each Agent in the event that it determines that any payment to be made by an Agent under the Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated; provided, however, that the Issuer’s obligations under this Section 7.12(h) shall apply only to the extent that such payments are so treated by virtue of characteristics of the Issuer, the Notes, or both.
Notwithstanding any other provision of this Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuer the amount so deducted or withheld, in which case, the Issuer shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.12(h)(ii).
. The Issuer may, at its option and at any time prior to the Stated Maturity of the Notes, by a resolution of its Board of Directors, at any
time, with respect to the Notes, elect to have either Section 8.02 or Section 8.03 be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article Eight.
. Upon the Issuer’s exercise under Section 8.01 of the option applicable to this Section 8.02, the Issuer shall be deemed to have been discharged from its obligations with respect to the Notes on the date the conditions set forth in Section 8.04 are satisfied (hereinafter, “legal defeasance”). For this purpose, such legal defeasance means that the Issuer shall be deemed to have paid and discharged the entire Debt represented by the outstanding Notes and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, at the expense of the Issuer, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive, solely from the trust fund described in Section 8.08 and as more fully set forth in such Section, payments in respect of the principal of (and premium, if any, on) and interest on such Notes when such payments are due, (b) the provisions set forth at Section 8.06 below, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Issuer’s obligations in connection therewith and (d) this Section 8.02. Subject to compliance with this Article Eight, the Issuer may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 below with respect to the Notes. If the Issuer exercises its legal defeasance option, payment of the Notes may not be accelerated because of an Event of Default.
. Upon the Issuer’s exercise under Section 8.01 of the option applicable to this Section 8.03, the Issuer shall be released from its obligations under any covenant contained in Sections 4.04 through 4.11, 4.16, 4.17, 4.19, 4.20 and 5.01 with respect to the Notes on and after the date the conditions set forth below are satisfied (hereinafter, “covenant defeasance”). For this purpose, such covenant defeasance means that, the Issuer may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby.
. In order to exercise either legal defeasance or covenant defeasance:
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(c) in the case of an election under Section 8.03, the Issuer must have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee to the effect that the beneficial owners of the outstanding Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in |
the same manner and at the same times as would have been the case if such covenant defeasance had not occurred; |
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(e) such legal defeasance or covenant defeasance shall not cause the Trustee to have a conflicting interest as defined in this Indenture with respect to any of the Issuer’s securities; |
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(k) the Issuer will have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the legal defeasance or the covenant defeasance, as the case may be, have been complied with. |
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(l) If the funds deposited with the Trustee to effect covenant defeasance are insufficient to pay the principal of, premium, if any, and interest on the Notes when due because of any acceleration occurring after an Event of Default, then the Issuer will remain liable for such payments. |
. This Indenture (and all Liens on Collateral created pursuant to the Security Documents) will be discharged and shall cease to be of further effect as to all Notes issued hereunder (except, in each case, as to surviving rights under Section 2.06) when:
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(a) the Issuer has irrevocably deposited or caused to be deposited with the Trustee (or such other party as directed by the Trustee) as funds in trust for such purpose an amount in cash in dollars, U.S. Government Securities or a combination of cash in dollars and U.S. Government Securities (in the case of the Dollar Notes), and cash in euros, European Government Obligations or a combination of cash in euros and European Government Obligations (in the case of the Euro Notes) sufficient to pay and discharge the |
entire Debt on such Notes not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and accrued and unpaid interest, Additional Amounts, if any, to the date of such deposit (in the case of Notes which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be and the Issuer shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of such Notes at Maturity or on the Redemption Date, as the case may be, and either: |
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(i) all Notes previously authenticated and delivered (other than lost, stolen or destroyed) that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in Section 8.07) have been delivered to the Trustee for cancellation; or |
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(ii) all Notes not theretofore delivered to the Trustee for cancellation (A) have become due and payable by reason of the mailing of a notice of redemption or otherwise or (B) will become due and payable at Stated Maturity within one year or (C) 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 Issuer’ name, and at the Issuer’ expense; and |
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(b) the Issuer has paid or caused to be paid all other amounts payable by the Issuer under this Indenture; and |
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(c) the Issuer has delivered an Officer’s Certificate and an Opinion of Counsel to the Trustee each stating that: (x) all conditions precedent to satisfaction and discharge have been satisfied, and (y) such satisfaction and discharge will not result in a breach or violation of, or constitute a default under this Indenture or any other agreement or instrument governed by the laws of the State of New York to which the Issuer or any Subsidiary is a party or by which the Issuer or any Subsidiary is bound. |
. Notwithstanding Sections 8.01 and 8.03, any obligations of the Issuer in Sections 2.02 through 2.14, 6.07, 7.05 and 7.06 shall survive until the Notes have been paid in full. Thereafter, any obligations of the Issuer in Section 7.05 shall survive such satisfaction and discharge. Nothing contained in this Article Eight shall abrogate any of the obligations or duties of the Trustee under this Indenture.
. Subject to Section 8.09, after the conditions of Section 8.02 or 8.03 have been satisfied, the Trustee upon written request shall acknowledge in writing the discharge of all of the Issuer’s obligations under this Indenture except for those surviving obligations specified in this Article Eight.
. Subject to Section 8.09, the Trustee shall hold in trust cash in euro or European Government Obligations deposited with it pursuant to this Article Eight. It shall apply the deposited cash or U.S. Government Securities or European Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal of, premium, if any, interest, and Additional Amounts, if any, on the Notes; but such money need not be segregated from other funds except to the extent required by law.
. Subject to Sections 7.05, and 8.01 through 8.04, the Trustee and the Paying Agent shall promptly pay to the Issuer upon request set forth in an Officer’s Certificate any excess money held by them at any time and thereupon shall be relieved from all liability with respect to such money. The Trustee and the Paying Agent shall pay to the Issuer upon request any money held by them for the payment of principal, premium, if any, interest or Additional Amounts, if any, that remains unclaimed for two years; provided that the Trustee or Paying Agent before being required to make any payment may cause to be published (a) through the newswire service of Bloomberg or, if Bloomberg does not then operate, any similar agency and, (b) if and so long as the Notes are listed on Euronext Dublin and the rules and regulations of such exchange so require, a newspaper having a general circulation in Ireland (which is expected to be The Irish Times) or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin (www.ise.ie) or mail to each Holder entitled to such money at such Holder’s address (as set forth in the Security
Register) notice that such money remains unclaimed and that after a date specified therein (which shall be at least 30 days from the date of such publication or mailing) any unclaimed balance of such money then remaining will be repaid to the Issuer. After payment to the Issuer, Holders entitled to such money must look to the Issuer for payment as general creditors unless an applicable law designates another Person, and all liability of the Trustee and such Paying Agent with respect to such money shall cease.
. The Issuer shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against deposited European Government Obligations or U.S. Government Securities or the principal, premium, if any, interest, if any, and Additional Amounts, if any, received on such European Government Obligations or U.S. Government Securities.
. If the Trustee or Paying Agent is unable to apply cash in euro or European Government Obligations, or cash in dollars or U.S. Government Securities, in accordance with this Article Eight by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Issuer’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to this Article Eight until such time as the Trustee or any such Paying Agent is permitted to apply all such cash or European Government Obligations or U.S. Government Securities in accordance with this Article Eight; provided that, if the Issuer has made any payment of principal of, premium, if any, interest, if any, and Additional Amounts, if any, on any Notes because of the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders of such Notes to receive such payment from the cash in euro or European Government Obligations, or cash in dollars or U.S. Government Securities, held by the Trustee or Paying Agent.
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(a) The Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolutions to the Trustee) and the Trustee may modify, amend or supplement this Indenture or the Notes and the Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent and copied to the Trustee) and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder: |
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(i) to evidence the succession of another Person to the Issuer and the assumption by any such successor of the provisions in this Indenture and in the Notes; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with the provisions of Article Five; provided, further, that such transaction need not be of a specific type identified in Article Five (it being understood that in the case of any other transaction, the requirements of Article Five shall apply mutatis mutandis); |
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(ii) to add to the Issuer’s covenants or any other obligor upon the Notes for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any other obligor upon the Notes, as applicable, herein or in the Notes; |
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(iii) to cure any ambiguity, or to correct or supplement any provision herein or in the Notes that may be defective or inconsistent with any other provision herein or in the Notes or to make any other provisions with respect to matters or questions arising under this Indenture or the Notes; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect; |
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(iv) to conform the text of this Indenture, the Security Documents or the Notes to any provision of the “Description of the Notes” section in the Offering Memorandum to the extent that such provision in such “Description of the Notes” section was intended to be a verbatim recitation of a provision of this Indenture, the Security Documents or the Notes; |
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(v) to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent hereunder or any Security Document; |
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(vi) to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuer’s obligations hereunder, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to this Indenture or otherwise to release Collateral from the Liens pursuant to this Indenture and the Security Documents when permitted or required by this Indenture and/or the Security Documents or to modify the Security Documents to secure Additional Notes pursuant to the terms of this Indenture; or |
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(vii) to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in this Indenture. |
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(b) In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate. |
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(a) Except as provided in Section 9.02(b) below and Section 6.04 and without prejudice to Section 9.01, the Issuer and the Trustee may: |
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(i) modify, amend or supplement this Indenture, the Security Documents or the Notes; or |
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(ii) waive compliance by the Issuer with any provision of this Indenture, the Security Documents or the Notes, |
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes) provided that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
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(b) Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 and an amendment, modification or supplement pursuant to Section 9.01, may: |
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(i) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note; |
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(ii) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note; |
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(iii) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable; |
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(iv) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date); |
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(v) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of this Indenture; |
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(vi) modify any of the provisions of this Article Nine or any provisions in this Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby; |
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(vii) directly or indirectly release the Liens on the Collateral except as permitted by this Indenture and the Security Documents; or |
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(viii) make any change in Section 4.12 that adversely affects the rights of any Holder or amend the terms of the Notes or this Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuer agrees to pay Additional Amounts (if any) in respect thereof in the supplemental indenture. |
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(ix) The consent of the Holders will not be necessary under this Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under this Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender. |
. Upon the execution of any supplemental indenture under this Article Nine, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.
. If an amendment, modification or supplement changes the terms of a Note, the Issuer or the Trustee may require the Holder to deliver it to the Trustee. The Trustee may place an appropriate notation on the Note and on any Note subsequently authenticated regarding the changed terms and return it to the Holder. Alternatively, if the Issuer so determines, the Issuer in exchange for the Note shall issue and the Trustee shall authenticate a new Note that reflects the changed terms. Failure to make the appropriate notation or to issue a new Note shall not affect the validity of such amendment, modification or supplement.
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. Promptly after the execution by the Issuer and the Trustee of any supplemental indenture or waiver pursuant to the provisions of Section 9.02, the Issuer shall give notice thereof to the Holders of each outstanding Note affected, in the manner provided for in Section 12.02(b), setting forth in general terms the substance of such supplemental indenture or waiver. The Issuer will inform Euronext Dublin of any material amendment to this Indenture or any supplement.
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(b) The aggregate principal amount of the Notes, at any date of determination, shall be the sum of (1) the principal amount of the Dollar Notes at such date of determination plus (2) the U.S. Dollar Equivalent, at such date of determination, of the principal amount of the Euro Notes at such date of determination. With respect to any matter requiring consent, waiver, approval or other action of the Holders of a specified percentage of the principal amount of all the Notes (and not solely the Dollar Notes or the Euro Notes as provided for in the proviso to the first sentence of Section 9.08(a)), such percentage shall be calculated, on the relevant date of determination, by dividing (i) the principal amount, as of such date of determination, of Notes, the Holders of which have so consented by (b) the aggregate principal amount, as of such date of determination, of the Notes then outstanding, in each case, as determined in accordance with the preceding sentence, Section 2.08 and Section 2.09 of this Indenture. Any such calculation made pursuant to this Section 9.08(b) shall be made by the Issuer and delivered to the Trustee pursuant to an Officer’s Certificate. |
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(a) The due and punctual payment of the principal of, interest on and Additional Amounts, if any, on the Notes when and as the same shall be due and payable, whether on an Interest Payment Date, at maturity, by acceleration, repurchase, redemption or otherwise, interest on the overdue principal of and interest (to the extent permitted by law), if any, on the Notes and performance of all other obligations under this Indenture shall be secured as provided in the Security Documents. The Trustee, the Security Agent and the Issuer hereby agree that, subject to Permitted Collateral Liens, the Security Agent shall hold the Collateral in trust for the benefit of the Trustee and all of the Holders pursuant to the terms of the Security Documents, and shall act as mortgagee or security holder under all mortgages or standard securities, beneficiary under all deeds of trust and as secured party under the applicable security agreements. |
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(b) Each Holder, by its acceptance thereof, consents and agrees to the terms of the Security Documents (including, without limitation, the provisions providing for foreclosure and release of Collateral) as the same may be in effect or may be amended from time to time in accordance with their terms and authorizes and directs the Security Agent to perform its respective obligations and exercise its rights thereunder in accordance therewith. |
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(c) The Trustee, the Security Agent and each Holder, by accepting the Notes, acknowledges that, as more fully set forth in the Security Documents, the Collateral as now or hereafter constituted shall be held for the benefit of all the Holders under the Security Documents, and that the Lien of this Indenture and the Security Documents in respect of the Security Agent and the Holders is subject to and qualified and limited in all respects by the Security Documents and actions that may be taken thereunder. |
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(d) Notwithstanding (i) anything to the contrary contained in this Indenture the Security Documents, Notes, or any other instrument governing, evidencing or relating to any Debt, (ii) the time, order or method of attachment of any Liens, (iii) the time or order of filing or recording of financing statements or other documents |
filed or recorded to perfect any Lien upon any Collateral, (iv) the time of taking possession or control over any Collateral or (v) the rules for determining priority under any law of any relevant jurisdiction governing relative priorities of secured creditors: |
(1)the Liens will rank equally and ratably with all valid, enforceable and perfected Liens, whenever granted upon any present or future Collateral, but only to the extent such Liens are permitted under this Indenture to exist and to rank equally and ratably with the Notes; and
(2)all proceeds of the Collateral applied under the Security Documents shall be allocated and distributed as set forth in the Security Documents.
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SECTION 11.02. Authorization of Actions to Be Taken by the Security Agent Under the Security Documents |
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(a) . The Security Agent shall be the representative on behalf of the Holders and shall act upon the written direction of the Trustee (in turn, acting on written direction of the Holders) with regard to all voting, consent and other rights granted to the Trustee and the Holders under the Security Documents. Subject to the provisions of the Security Documents, the Security Agent may, in its sole discretion and without the consent of the Holders, on behalf of the Holders, take all actions it deems necessary or appropriate in order to (a) enforce any of its rights or any of the rights of the Holders under the Security Documents and (b) receive any and all amounts payable from the Collateral in respect of the obligations of the Issuer hereunder. Subject to the provisions of the Security Documents, the Security Agent shall have the power to institute and to maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Collateral by any acts of impairment that may be unlawful or in violation of the Security Documents or this Indenture and such suits and proceedings as the Security Agent (after consultation with the Trustee, where appropriate) may deem reasonably expedient to preserve or protect its interest and the interests of the Holders in the Collateral (including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would impair the security interest hereunder or be prejudicial to the interests of the Holders or the Security Agent). The Security Agent is hereby irrevocably authorized by each Holder to effect any release of Liens or Collateral contemplated by Section 11.04 hereof or by the terms of the Security Documents. |
Each Holder, by accepting a Note, shall be deemed (i) to have authorized the Trustee and the Security Agent to enter into the Security Documents, in each case in compliance with this Indenture and (ii) to be bound thereby. Each Holder, by accepting a Note, appoints the Trustee or the Security Agent, as the case may be, as its agent under the Security Documents and authorizes it to act as such.
. The Security Agent is authorized to receive and distribute any funds for the benefit of the Holders under the Security Documents, and to make further distributions of such funds to the Holders according to the provisions of this Indenture and the Security Documents.
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(a) Upon (i) confirmation in writing from the Trustee of the full and final payment and performance of all obligations under this Indenture and the Notes; (ii) confirmation in writing from the Trustee of the surrender of all outstanding Notes issued under this Indenture to the Trustee for cancellation; (iii) the release of the Collateral in accordance with the terms of this Section 11.04 and the Security Documents; or (iv) any other release of the Collateral as security for obligations of the Issuer under this Indenture, the Security Agent shall disclaim and give up any and all rights it has in or to the Collateral, and any rights it has under the Security Documents and shall no longer be deemed to hold the Lien in the Collateral for the benefit of the Holders. |
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(b) Liens granted in favor of the Notes will be automatically and unconditionally released (and, upon request of the Issuer, the Security Agent shall (without notice to, or vote or consent of, any Holder but with notice to the Trustee) take such actions as shall be required to release such Liens): |
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(i) upon legal defeasance, covenant defeasance or satisfaction and discharge of this Indenture as provided under Sections 8.02, 8.03 and 8.05; |
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(ii) upon the full and final payment of the Notes and performance of all Obligations of the Issuer under this Indenture and the Notes; |
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(iii) as described in Article Nine; |
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(iv) as otherwise permitted in accordance with this Indenture and the Security Documents; |
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(v) in connection with any Permitted Reorganization; |
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(vi) with respect to the Liens over the Qualified Capital Stock held by the Issuer or a Restricted Subsidiary of the Issuer, in connection with, contemplation or anticipation of a sale of such Qualified Capital Stock that does not violate the provisions of this Indenture; or |
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(vii) with respect to Liens over the Escrow Accounts, upon the consummation of the redemption described in paragraph 6(b) of the Notes. |
In the event that the shares of Qualified Capital Stock released in accordance with clause (vi) above are not sold by the time contemplated in the associated underwriting or purchase agreement (as extended by any waiver or other agreements) the Issuer or the applicable Restricted Subsidiary of the Issuer will grant a similar lien in favor of the Security Agent for the benefit of the Holders as soon as practicable, such Liens to be subject to substantially similar release provisions as described herein, applicable mutatis mutandi.
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(c) Any release of Collateral made in compliance with this Section 11.04 shall not be deemed to impair the Lien under the Security Documents or the Collateral thereunder in contravention of the provisions of this Indenture or the Security Documents. |
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(d) In the event that the Issuer seeks to release Collateral, the Issuer shall deliver an Officer’s Certificate (which the Trustee and Security Agent shall rely upon in connection with such release) to the Trustee and the Security Agent setting forth that the specified release complies with the terms of this Indenture. Upon receipt of the Officer’s Certificate and if so requested by the Issuer, the Security Agent shall execute, deliver or acknowledge any necessary or proper instruments of termination, satisfaction or release to evidence the release of any Collateral permitted to be released pursuant to this Indenture. |
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(a) Without prejudice to the provisions of this Indenture and the Security Documents and for the purpose of preserving the initial and continuing validity of the security rights granted and to be granted by the Issuer to the Security Agent, an amount equal to and in the same currency of the obligations under the Notes from time to time due by the Issuer in accordance with the terms and conditions of the Notes, shall be owing as a separate and independent obligation of the Issuer to the Security Agent (such payment undertaking and the obligations and liabilities which are the result thereof the “Parallel Debt”). |
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(b) The Issuer and the Security Agent acknowledge that (i) for this purpose the Parallel Debt constitutes undertakings, obligations and liabilities of the Issuer to the Security Agent under this Indenture and the Security Documents which are separate and independent from, and without prejudice to, the corresponding obligations under the Notes which the Issuer has to the Holders and (ii) that the Parallel Debt represents the Security Agent’s own claims to receive payment of the Parallel Debt; provided that the total amount which may become due under the Parallel Debt shall never exceed the total amount which may become due under the Notes; provided, further, that the Security Agent shall exercise its rights with respect to the Parallel Debt solely in accordance with this Indenture and the Security Documents. |
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(c) Every payment of monies made by the Issuer to the Security Agent shall (conditionally upon such payment not subsequently being avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, insolvency, liquidation or similar laws of general application) be in satisfaction pro tanto of the covenant by the Issuer contained in Section 11.05(a); provided that if any such payment as is mentioned above is subsequently avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, liquidation or similar laws of general application the Security Agent shall be entitled to receive the amount of such payment from the Issuer and the Issuer shall remain liable to perform the relevant obligation and the relevant liability shall be deemed not to have been discharged. |
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(d) Subject to the provision in paragraph (c) of this Section 11.05, but notwithstanding any of the other provisions of this paragraph (d): |
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(i) the total amount due and payable as Parallel Debt under this Section 11.05 shall be decreased to the extent that the Issuer shall have paid any amounts to the Security Agent or to the Trustee on behalf of the Holders or any of them to reduce the outstanding principal amount of the Notes or the Security Agent or the Trustee on behalf of the Holders otherwise receives any amount in payment of the Notes; and |
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(ii) to the extent that the Issuer shall have paid any amounts to the Trustee or to the Security Agent under the Parallel Debt or the Trustee or the Security Agent shall have otherwise received monies in payment of the Parallel Debt, the total amount due and payable under the Notes shall be decreased as if said amounts were received directly in payment of the Notes. |
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(a) Any notice or communication shall be in writing and delivered in person or mailed by first class mail or sent by facsimile transmission addressed as follows: |
if to the Issuer:
56, rue Charles Martel
L-2134 Luxembourg, Luxembourg
Attn: Finance Director
With copies to:
Shearman & Sterling
9 Appold Street
London, EC2A 2AP
United Kingdom
Telephone: +44 (0)20 7655 5000
Facsimile: +44 (0)20 7655 5500
Attention: Mr. Trevor Ingram
if to the Trustee, Principal Paying Agent or Transfer Agent:
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
(i) For the Trustee and Security Agent
Fax: +44 20 3060 4796
Attn: The Directors, Agency & Trust
(ii) For the Principal Paying Agent
Fax: +353 1 622 2210
Attn: PPA desk
(iii) For the Transfer Agent
Fax: +353 1 622 2031
Attn: Transfer Agent
The Issuer or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
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(b) Notices regarding the Notes shall be: |
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(i) delivered to Holders electronically or mailed by first-class mail, postage paid, and, if and so long as the Notes are listed on Euronext Dublin and the rules and regulations of such exchange so require, published in a newspaper having a general circulation in Ireland (which is expected to be The Irish Times or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and |
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(ii) in the case of certificated Notes, mailed to each Holder by first-class mail at such Holder’s respective address as it appears on the registration books of the Registrar. |
Notices given by first-class mail shall be deemed given five calendar days after mailing and notices given by publication shall be deemed given on the first date on which publication is made. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
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(c) If and so long as the Notes are listed on any securities exchange instead of or in addition to Euronext Dublin, notices shall also be given in accordance with any applicable requirements of such alternative or additional securities exchange. |
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(d) If and so long as the Notes are represented by Global Notes, notice to Holders, in addition to being given in accordance with Section 12.02(b) above, shall also be given by delivery of the relevant notice to DTC, Euroclear and Clearstream for communication. |
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(e) Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. |
. Upon any request or application by the Issuer to the Trustee to take or refrain from taking any action under this Indenture (except in connection with the original issuance of the Original Notes on the date hereof), the Issuer shall furnish upon request to the Trustee:
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(b) an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with. |
Any Officer’s Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless the officer signing such certificate knows, or in the exercise of reasonable care should know, that such Opinion of Counsel with respect to the matters upon which such Officer’s Certificate is based are erroneous. Any Opinion of Counsel may be based and may state that it is so based, insofar as it relates to factual matters, upon certificates of public officials or an Officer’s Certificate stating that the information with respect to such factual matters is in the possession of the Issuer, unless the counsel signing such Opinion of Counsel knows, or in the exercise of reasonable care should know, that the Officer’s Certificate with respect to the matters upon which such Opinion of Counsel is based are erroneous.
. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:
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(a) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; |
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(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; |
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(c) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and |
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(d) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. |
. The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar and the Paying Agent may make reasonable rules for their functions.
. If an Interest Payment Date or other payment date is not a Business Day, payment shall be made on the next succeeding day that is a Business Day, and no interest shall accrue for the intervening period. If a Record Date is not a Business Day, the Record Date shall not be affected.
. THIS INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAW RULES THEREOF. THE APPLICATION OF THE PROVISIONS SET OUT IN ARTICLES 470-1 TO 470-19 OF THE LUXEMBOURG LAW ON COMMERCIAL COMPANIES DATED AUGUST 10, 1915, AS AMENDED, IS EXCLUDED.
. The Issuer agrees that any suit, action or proceeding against the Issuer brought by any Holder or the Trustee arising out of or based upon this Indenture or the Notes may be instituted in any state or Federal court in the Borough of Manhattan, New York, New York, and any appellate court from any thereof, and each of them irrevocably submits to the non-exclusive jurisdiction of such courts in any suit, action or proceeding. The Issuer irrevocably waives, to the fullest extent permitted by law, any objection to any suit, action, or proceeding that may be brought in connection with this Indenture or the Notes, including such actions, suits or proceedings relating to securities laws of the United States of America or any state thereof, in such courts whether on the grounds of venue, residence or domicile or on the ground that any such suit, action or proceeding has been brought in an inconvenient forum. The Issuer agrees that final judgment in any such suit, action or proceeding brought in such court shall be conclusive and binding upon the Issuer and may be enforced in any court to the jurisdiction of which the Issuer is subject by a suit upon such judgment; provided that service of process is effected upon the Issuer in the manner provided by this Indenture. The Issuer has appointed Ardagh Holdings USA Inc., c/o The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware 19801, or any successor so long as such successor is resident in the United States and can act for this purpose, as its authorized agent (the “Authorized Agent”), upon whom process may be served in any suit, action or proceeding arising out of or based upon this Indenture or the Notes or the transactions contemplated herein which may be instituted in any state or Federal court in the Borough of Manhattan, New York, New York, by any Holder or the Trustee, and expressly accepts the non-exclusive jurisdiction of any such court in respect of any such suit, action or proceeding. The Issuer hereby represents and warrants that the Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Issuer agrees to take any and all action, including the filing of any and all documents that may be necessary to continue such respective appointment in full force and effect as aforesaid. Service of process upon the Authorized Agent shall be deemed, in every respect, effective service of process upon the Issuer. Notwithstanding the foregoing, any action involving the Issuer arising out of or based upon this Indenture or the Notes may be instituted by any Holder or the Trustee in any other court of competent jurisdiction. The Issuer expressly consents to the jurisdiction of any such court in respect of any such action and waives any other requirements of or objections to personal jurisdiction with respect thereto and waives any right to trial by jury.
. A director, officer, employee, incorporator, member or shareholder, as such, of the Issuer shall not have any liability for any obligations of the Issuer under the Notes or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release shall be part of the consideration for the issue of the Notes. Such waiver and release may not be effective to waive liabilities under the U.S. federal securities laws.
. All agreements of the Issuer in this Indenture and the Notes shall bind their respective successors. All agreements of the Trustee in this Indenture shall bind its successors.
. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Indenture.
. The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.
. In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
sums payable under the Notes and this Indenture. Any amount received or recovered in respect of the Notes or otherwise under this Indenture in a currency other than the applicable Required Currency (whether as a result of, or of the enforcement of, a judgment or order of a court of any jurisdiction, in the winding up or dissolution of the Issuer, any Subsidiary or otherwise) by the Trustee or a Holder in respect of any sum expressed to be due to such Holder from the Issuer shall constitute a discharge of the Issuer’s obligations only to the extent of the amount of the applicable Required Currency which the recipient is able to purchase with the amount so received or recovered in such other currency on the date of that receipt or recovery (or, if it is not possible to purchase the applicable Required Currency on that date, on the first date on which it is possible to do so). If the amount of the applicable Required Currency to be recovered is less than the amount of the applicable Required Currency expressed to be due to the recipient under any Note, the Issuer shall indemnify the recipient against the cost of making any further purchase of the applicable Required Currency in an amount equal to such difference. For the purposes of this Section 12.14, it will be sufficient for the Holder to certify that it would have suffered a loss had the actual purchase of the applicable Required Currency been made with the amount so received in that other currency on the date of receipt or recovery (or, if a purchase of the applicable Required Currency on that date had not been possible, on the first date on which it would have been possible). The foregoing indemnities, to the extent permitted by law: (a) constitute a separate and independent obligation from the other obligations of the Issuer; (b) shall give rise to a separate and independent cause of action; (c) shall apply irrespective of any waiver granted by any Holder; and (d) shall continue in full force and effect despite any other judgment, order, claim or proof for a liquidated amount in respect of any sum due under any Note or other judgment or order. |
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(a) any Liability may be subject to the exercise of Write-down and Conversion Powers by the Resolution Authority; |
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(b) the Issuer will be bound by the effect of any application of any Write-down and Conversion Powers in relation to any Liability and in particular (but without limitation) by: |
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(i) any reduction in the principal amount, in full or in part, or outstanding amount due (including any accrued but unpaid interest) in respect of any Liability; and |
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(ii) any conversion of all or part of any Liability into ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person; that may result from any exercise of any Write-down and Conversion Powers in relation to any Liability; |
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(c) the terms of this Indenture and the rights of the Issuer hereunder may be varied, to the extent necessary, to give effect to any exercise of any Write-down and Conversion Powers in relation to any Liability and the Issuer will be bound by any such variation; |
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(d) ordinary shares or other instruments of ownership of Citigroup Global Markets Europe AG or any other Person may be issued to or conferred on the Issuer as a result of any exercise of any Write-down and Conversion Powers in relation to any Liability. |
For purposes of this Section 12.15:
“Liability” means any liability of Citigroup Global Markets Europe AG to the Issuer arising under or in connection with this Indenture;
“Resolution Authority” means the German Federal Agency for Financial Markets Stabilisation (Bundesanstalt für Finanzmarktstabilisierung), or any other body which has authority to exercise any Write-down and Conversion Powers; and
“Write-down and Conversion Powers” means any write-down, conversion, transfer, modification or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in Germany, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time, including but not limited to the German Recovery and Resolution Act (Sanerungs-und Abwicklungsgesetz) as amended from time to time, and the instruments, rules and standards created thereunder, pursuant to which:
(a)any obligation of Citigroup Global Markets Europe AG (or other affiliate of such entity) can be reduced, cancelled, modified or converted into shares, other securities or other obligations of such entity or any other person (or suspended for a temporary period); and
(b)any right in a contract governing an obligation of Citigroup Global Markets Europe AG may be deemed to have been exercised.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
ARD FINANCE S.A.,
as Issuer
By:
Name:
Title:
CITIBANK, N.A., LONDON BRANCH,
as Trustee, Security Agent, Principal Paying Agent and Transfer Agent
By:
Name:
Title:
CITIGROUP GLOBAL MARKETS
EUROPE AG,
as Registrar
By:
Name:
Title:
By:
Name:
Title:
EXHIBIT A-1
[FORM OF FACE OF DOLLAR NOTE]
ARD FINANCE S.A.
Société Anonyme
Registered Office: 56, rue Charles Martel, L-2134 Luxembourg
R.C.S. Luxembourg: B 160806
[If Regulation S Dollar Global Note – CUSIP Number L02238 AH3 / ISIN USL02238AH37]
[If Restricted Dollar Global Note – CUSIP Number 00191A AD8 / ISIN US00191AAD81]
No. [●]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE AND IS REGISTERED IN THE NAME OF DTC OR A NOMINEE OF DTC OR A SUCCESSOR DEPOSITARY. THIS NOTE IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON-U.S. PERSON ACQUIRING THIS NOTE IN AN ‘‘OFFSHORE TRANSACTION’’ PURSUANT TO RULE 144A OR RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2)
AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED NOTES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE ‘‘RESALE RESTRICTION TERMINATION DATE’’) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE NOTES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) FOR UNITED STATES FEDERAL INCOME TAX PURPOSES. PURSUANT TO SECTION 2.16 OF THE INDENTURE, The Issuer agrees, and by acceptance of a beneficial ownership interest in the Notes each Holder of Notes will be deemed to have agreed (in the absence of an administrative pronouncement or judicial ruling to the contrary), for United States federal income tax purposes to treat the Notes as indebtedness of the Company subject to United States Treasury regulations section 1.1275-4 (the “Contingent Debt Regulations”) and, for purposes of the Contingent Debt Regulations, to treat payments received by a Holder on the Notes as a contingent payment. A Holder of Notes may obtain the issue price, AMOUNT OF OID, issue date, yield to maturity, comparable yield and the projected payment schedule by submitting a written request for such information to the chief financial officer of ARD Finance S.A. at: Attention: Chief Financial Officer, ARD Finance S.A. at 56, rue Charles Martel, L-2134 Luxembourg, Luxembourg.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN $200,000.
6.500% / 7.250% SENIOR SECURED TOGGLE NOTES DUE 2027
ARD Finance S.A., a public limited liability company (société anonyme) incorporated under the laws of Luxembourg promises to pay to [●] or registered assigns the principal sum of $[●] (as such amount may be increased or decreased as indicated in Schedule A (Schedule of Principal Amount) of this Note) on June 30, 2027.
From [●] or from the most recent Interest Payment Date (as defined in this Note) to which interest has been paid or provided for, interest on this Note will accrue at 6.500% per annum with respect to Cash Interest (as defined in this Note) and, if payment-in-kind interest is payable, 7.250% per annum with respect to PIK Interest (as defined in this Note), payable semi-annually on June 30 and December 30 of each year, beginning on June 30, 2020, to the Person in whose name this Note (or any predecessor Note) is registered at the close of business one business day immediately preceding the related Interest Payment Date.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof. THE APPLICATION OF THE PROVISIONS SET OUT IN ARTICLES 470-1 TO 470-19 OF THE LUXEMBOURG LAW ON COMMERCIAL COMPANIES DATED AUGUST 10, 1915, AS AMENDED, TO THE NOTES IS EXCLUDED.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, ARD Finance S.A. has caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARD FINANCE S.A.
By:
Name:
Title:Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
6.500 % / 7.250% SENIOR SECURED TOGGLE NOTES DUE 2027
1.Interest
ARD Finance S.A., a public limited liability company (société anonyme) incorporated under the laws of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B160.806 (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuer”), for value received, promises to pay interest on the principal amount of this Note from [●] at the rate per annum shown above. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuer shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a)All payments that the Issuer makes under or with respect to the Notes shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which the Issuer is organized, resident or doing business for tax purposes or from or through which it (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless the Issuer or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If the Issuer or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note, the Issuer shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b)The Issuer will not, however, pay Additional Amounts in respect or on account of:
(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Person’s in whose name a Note is registered on the Registrar’s books (each such Person, a “Holder”) or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes, or the exercise or enforcement of rights under any Notes);
(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuer’s written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note;
(v) any Tax imposed on or with respect to any payment by the Issuer to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the U.S. Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(ix) any combination of the foregoing.
(c)If the Issuer is the applicable withholding agent, the Issuer shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d)At least 30 calendar days prior to each date on which any payment under or with respect to this Note is due and payable, if the Issuer will be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note is due and payable, in which case it will be promptly thereafter), the Issuer will deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and will set forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuer shall promptly publish a notice in accordance with Section 12.02 of the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. Such Additional Amounts may be paid by the Issuer, at its option, in the form of cash or Additional Notes. To the extent that the Issuer or any applicable withholding agent is required by law or by the interpretation or administration thereof to make any deduction or withholding from any payment of interest on this Note or any payment of an Additional Amount which, in either case, is made through the issuance of Additional Notes, the foregoing provisions shall apply with respect to such withholding or deduction requirement, mutatis mutandis.
In addition, the Issuer will pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note.
Upon written request, the Issuer will furnish to the Trustee or the Principal Paying Agent or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by the Issuer of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of the Issuer to obtain such receipts, the same are not obtainable, the Issuer will provide
the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by the Issuer. If requested by the Trustee or the Principal Paying Agent, the Issuer will provide to the Trustee or the Principal Paying Agent, as the case may be, such information as may be reasonably available to the Issuer (and not otherwise in the possession of the Trustee or the Principal Paying Agent, as applicable) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
(e)Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this Note, such reference includes the payment of Additional Amounts, if applicable.
(f)The preceding provisions will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction in which any successor Person to any of the Issuer is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on this Note and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuer shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next stated maturity of an installment of interest on the Note (an “Interest Payment Date”) even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuer shall pay principal and interest in dollars in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuer by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
In the case of the payment of PIK Interest, including in the event of payment of Additional Amounts, the Issuer may elect to either increase the outstanding principal amount of the Notes or issue additional Notes (the “Dollar PIK Interest Notes,” in the case of the Dollar Notes, and the “Euro PIK Interest Notes,” in the case of the Euro Notes and, together, the “PIK Interest Notes”) under the Indenture having the same terms as this Note (in each case, a “PIK Payment”).
Except as provided in the immediately succeeding sentence and the definition of “Cash Available for Debt Service,” interest on this Note shall be payable entirely in cash (“Cash Interest”). For any interest period after the initial interest period (other than the final interest period ending at stated maturity), if the Cash Available for Debt Service (as defined below) as determined by the Issuer on the Determination Date (as defined below) for such interest period:
(i)equals or exceeds 75%, but is less than 100% of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 25% of the then outstanding principal amount of the Notes by increasing the principal amount of the outstanding Notes or by issuing Additional Notes in a principal amount equal to such interest (“PIK Interest”);
(ii)is equal to or exceeds 50%, but is less than 75%, of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 50% of the then outstanding principal amount of the Notes as PIK Interest;
(iii) is equal to or exceeds 25%, but is less than 50%, of the aggregate amount of Cash Interest would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 75% of the then outstanding principal amount of the Notes as PIK Interest; or
(iv) is less than 25% of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 100% of the then outstanding principal amount of the Notes as PIK interest.
As used herein:
“Cash Available for Debt Service” shall be the amount equal to the sum (without duplication) of:
(i)all cash and Cash Equivalents on hand at the Issuer as of such Determination Date (other than (x) any cash and Cash Equivalents the distribution of which was conditioned upon such cash and Cash Equivalents being used for a purpose other than paying Cash Interest, (y) any amounts on deposit in the Escrow Account and (z) an amount necessary to maintain the corporate existence of the Issuer and its Subsidiaries, to pay any amounts the Issuer may be required to pay in relation to taxes, assessments, governmental charges or similar obligations and to carry out activities not prohibited by the Notes and the Indenture), which amount shall in no event be less than $0 (provided that there shall be excluded from this clause (i) any net proceeds from the Notes and any cash and Cash Equivalents on hand to be used for payment of interest on the Notes on the Interest Payment Date immediately succeeding such Determination Date); and
(ii)the maximum amount of all dividends and other distributions that, as of the applicable Determination Date, would be lawfully permitted to be paid to the Issuer (with respect to any Subsidiary that is not a wholly owned Subsidiary, pro rata for the economic interest of the Issuer in the Qualified Capital Stock such Subsidiary), if any, for the purpose of paying Cash Interest by all Restricted Subsidiaries of the Issuer after giving effect to all corporate, shareholder or other comparable actions (including fiduciary and other directors’ duties) required in order to make such payment, requirements under applicable law and all restrictions or limitations on the ability to make such dividends or distributions that are otherwise permitted by the “adjusted net income”, “general basket” and similar provisions (but excluding all other carve outs and baskets) of the “restricted payments” and similar restrictive covenants and provisions in financing or other contractual arrangements (including joint venture agreements and shareholder agreements) of any Subsidiary or any of its Restricted Subsidiaries or any agreement that amends, modifies, renews, increases, supplements, refunds, replaces or refinances such financing or other contractual arrangements in the manner prescribed by such covenant), net of all taxes attributable primarily to such dividend or distribution, if any.
To the extent the Issuer is required to pay Cash Interest for all or any portion of the interest due on any Interest Payment Date, the Issuer shall and shall cause each of the Restricted Subsidiaries, without prejudice to fiduciary or other directors’ duties, to take all such shareholder, corporate and other actions necessary or appropriate to permit the making of any such dividends or other distribution or other form of return on capital provided that any such shareholder and corporate and other actions would not violate applicable law.
“Determination Date” shall mean, with respect to each interest period following the first interest period, the seventh calendar day immediately prior to the first day of the relevant interest period.
In the event that the Issuer is entitled to pay PIK Interest for any interest period, then the Issuer shall deliver a notice to the Trustee and each Paying Agent following the Determination Date but not less than five (5) Business Days prior to the commencement of the relevant interest period, which notice shall state the total amount of interest to be paid on such Interest Payment Date and the amount of such interest to be paid as PIK Interest. The Trustee or the Principal Paying Agent, as the case may be, shall promptly deliver the same notice to the Holders.
Notwithstanding the foregoing, the delivery of such notice to the Trustee and the Paying Agents shall not restrict the Issuer’s ability to pay, at its option, a greater portion of the interest on this Note with respect to such interest period as Cash Interest in which case the Issuer shall deliver a notice to that effect to the Trustee and each Paying Agent no later than five (5) Business Days prior to the Interest Payment Date of the relevant interest period. Interest for the first interest period commencing on the Issue Date shall be payable entirely in Cash Interest. Interest for the final interest period ending at stated maturity shall be payable entirely in Cash Interest.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent and Citigroup Global Markets Europe AG will act as Registrar. The Issuer or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuer issued this Note under an indenture dated as of November 20, 2019 (the “Indenture”) among the Issuer, Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as Transfer Agent, Citibank, N.A., London Branch, as security agent (the “Security Agent”), and Citigroup Global Markets Europe AG, as Registrar. The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuer and its Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Issuer and its Restricted Subsidiaries, Change of Control and Liens.
6.Redemption
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(a) Optional Redemption Prior to November 15, 2022: At any time and from time to time, prior to November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer may redeem all or part of this Note, at a Redemption Price equal to 100% of the principal amount hereof plus the Applicable Redemption Premium and accrued and unpaid interest to the Redemption Date (subject to the rights of Holders on the relevant Record Date to receive interest on the relevant Interest Payment Date). |
“Applicable Redemption Premium” means, with respect to any Note on any Redemption Date, the greater of:
(1) 1.0% of the principal amount of such Notes; or
(2) the excess of:
(i) the present value at such redemption date of (x) the redemption price of the Note at November 15, 2022, (such redemption price being set forth in the table appearing in paragraph (c) below) plus (y) all required interest payments that would otherwise be due to be paid on such Notes during the period between the redemption date and November 15, 2022 (excluding accrued but unpaid interest), computed using a discount rate equal to the Treasury Rate as of such Redemption Date plus 50 basis points; over
(ii) the outstanding principal amount of such Notes.
For the avoidance of doubt, calculation of the Applicable Redemption Premium shall not be a duty or obligation of the Trustee or any paying agent. Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
“Treasury Rate” means, as of any redemption date, the weekly average rounded to the nearest 1/l00th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the redemption date) of the yield to maturity of United States Treasury securities with a constant maturity (as compiled and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week 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 redemption date to November 15, 2022; provided, however, that if the period from the redemption date to November 15, 2022 is not equal to the constant maturity of a United States Treasury security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one‑twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the redemption date to November 15, 2022 is less than one year, the weekly average yield on actually traded United States Treasury securities (or other comparable benchmark) adjusted to a constant maturity of one year shall be used.
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(b) Mandatory Redemption on November 15, 2022: Upon not less than 10 nor more than 60 days’ notice, on November 15, 2022, the Issuer shall redeem the maximum aggregate principal amount of (i) this Note and (ii) all other Notes issued pursuant to the Indenture, on a pro rata basis, that could be purchased with all cash and Cash Equivalents deposited in the Escrow Account (after deducting the reasonable fees and expenses of such redemption from such deposited amounts) at a purchase price equal to 104% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest to the redemption date (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). In connection with such redemption, the Issuer shall redeem this Note and all other Notes subject to such redemption on a pro rata basis based on the aggregate principal amount of such Notes outstanding as of the date of redemption. This redemption is subject to the right of Holders of record on the relevant record date that is prior to the redemption date to receive interest due on an Interest Payment Date. |
(c)Optional Redemption on or after November 15, 2022: At any time and from time to time on or following November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer may redeem all or part of the Notes. These redemptions will be in a minimum amount of $200,000 and in minimum denominations of $1 or integral multiples thereof, at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to the Redemption Date, if redeemed during the 12-month period commencing on November 15 of the years set forth below (subject to the right of Holders of record on the relevant Record Date that is prior to the Redemption Date to receive interest due on an Interest Payment Date).
Year |
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Redemption Price Dollar Notes |
2022..................................................................................................................... |
103.250% |
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2023..................................................................................................................... |
101.625% |
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2024 and thereafter............................................................................................. |
100.000% |
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
7.Mandatory Offers and Redemptions with Net Cash Proceeds from Pledged Company Share Sales
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(a) Mandatory Offers prior to November 15, 2022: At any time prior to November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer shall make an offer to repurchase this Note with the Net Cash Proceeds from the sales by the Issuer or any Intermediate Holding Company (other than (i) sales by the Issuer to an Intermediate Holding Company or by an Intermediate Holding Company to the Issuer or another Intermediate Holding Company; provided that, in each case under this clause (i), the purchaser thereof grants a Lien over the relevant Qualified Capital Stock to secure the Notes or (ii) in connection with a Permitted Reorganization) of |
Qualified Capital Stock of any Pledged Company (a “Pledged Company Share Sale”) at a purchase price (expressed as a percentage of their principal amount at maturity) equal to or greater than 104% (as determined by the Issuer) of the principal amount of the Notes being repurchased, plus accrued and unpaid interest to the purchase date (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). |
To the extent that the aggregate purchase amount (including premium and accrued and unpaid interest) in respect of all Notes tendered pursuant to a mandatory offer as a result of a Pledged Company Share Sale is less than the aggregate amount of Net Cash Proceeds from the applicable Pledged Company Share Sale, the Issuer shall promptly deposit such excess amount into the Escrow Account.
(b)Mandatory Redemptions on or after November 15, 2022: At any time on or after November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer shall redeem this Note, along with all other Notes issued pursuant to the Indenture on a pro rata basis, with the Net Cash Proceeds from any Pledged Company Share Sale in accordance with the provisions set forth in paragraph 6(c) above. In connection with such redemption, the Issuer shall redeem this Note and all other Notes subject to such redemption on a pro rata basis based on the aggregate principal amount of such Notes outstanding on the date of redemption.
8.Escrow Offers
To the extent any amounts deposited in the Escrow Account have not been subject to an Escrow Offer, on or within 30 days following each of November 15, 2020 and November 15, 2021 as determined by the Issuer (each an “Escrow Offer Trigger Date”), upon not less than 10 nor more than 60 days’ notice, the Issuer shall make an Escrow Offer to repurchase this Note and all other Notes issued pursuant to the Indenture, on a pro rata basis, with such amounts (less the reasonable fees and expenses relating to such Escrow Offer) (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). In connection with such Escrow Offer, the Issuer shall offer to purchase this Note and all other Notes subject to such Escrow Offer on a pro rata basis based on the aggregate principal amount of such Notes outstanding as of the date of such Escrow Offer.
9.Procedures for Mandatory Offers to Purchase Notes
Within five Business Days following a Pledged Company Share Sale prior to November 15, 2022 or on or before each Escrow Offer Trigger Date (to the extent an Escrow Offer is then required), the Issuer will:
(a)cause a notice of the mandatory offer to be (i) delivered to Holders (with a copy to the Trustee) electronically or mailed by first‑class mail, postage prepaid; and (ii) if at the time of such notice the Notes are listed on Euronext Dublin and the rules of Euronext Dublin so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and
(b)send notice of the mandatory offer by first class mail, with a copy to the Trustee, to each Holder to the address of such Holder appearing in the security register, which notice will state:
(i)that a Pledged Company Share Sale or an Escrow Offer Trigger Date has occurred, and the date it occurred;
(ii)the purchase price for the mandatory offer and the purchase date, which will be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations;
(iii)that any Note accepted for payment pursuant to the mandatory offer will cease to accrue interest after the purchase date unless the purchase price is not paid;
(iv)that any Note (or part thereof) not tendered will continue to accrue interest; and
(v)any other procedures that a Holder must follow to accept such mandatory offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on Euronext Dublin).
The Trustee will promptly authenticate and deliver a new Note or Notes equal in principal amount to any unpurchased portion of Notes surrendered, if any, to the Holder of Notes in global form or to each Holder of certificated Notes; provided that each such new Note or Notes will be in a total principal amount of at least $200,000 and in minimum denominations of $1 or integral multiples thereof. The Issuer will publicly announce the results of a mandatory offer on or as soon as practicable after the applicable purchase date.
Notwithstanding anything to the contrary contained herein, with respect to any Pledged Company Share Sale, such mandatory offer may be made in advance of a Pledged Company Share Sale, conditioned upon, among other things, the consummation of such Pledged Company Share Sale.
The Issuer’s offer shall be made to Holders on a pro rata basis based on the aggregate principal amount of the Notes outstanding on the date of such offer; provided that in the event that aggregate purchase amount for this Note, as applicable, tendered by Holders is less than the aggregate purchase amount in respect of the Note offered to be purchased, the Issuer may apply any additional Net Cash Proceeds not used to purchase this Note to purchase Notes denominated in the other currency if the aggregate purchase amount for Notes in such other currency that are tendered by Holders in such offer exceeds the amount of Net Cash Proceeds that would have otherwise been available to repurchase such Notes of such other currency.
If the aggregate purchase amount (including premium and accrued and unpaid interest) in respect of Notes validly tendered and not withdrawn by Holders thereof exceeds the aggregate amount of Net Cash Proceeds from the applicable Pledged Company Share Sale (after giving effect to the immediately preceding paragraph), the Notes to be purchased will be selected by a method that complies with the requirements, as certified to the Trustee by the Issuer, of the principal securities exchange, if any, on which the Notes are listed at such time, and in compliance with the requirements of the relevant clearing system or, if the Notes are not listed on a securities exchange, or such securities exchange prescribes no method of selection and the Notes are not held through clearing system or the clearing system prescribes no method of selection, by lot.
Any offer to purchase may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
10.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuer, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing clauses (a) and (b), a “Change in Tax Law”), the Issuer would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in Paragraph 2), with respect to the Relevant Taxing Jurisdiction, which the Issuer cannot avoid by the use of reasonable measures available to the Issuer. Prior to the giving of any notice of redemption pursuant to this paragraph, the Issuer shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuer taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuer of recognized standing qualified under the laws of
the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuer has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on the Holders.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuer would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
11.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than $200,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of $1 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
12.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuer shall offer to purchase on the Change of Control Purchase Date all or any part (equal to $200,000 or an integral multiple of $1 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuer shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to Section 6(a), “Optional Redemption Prior to November 15, 2022” or Section 6(c), “Optional Redemption on or after November 15, 2022” of this Note. The Issuer shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders must follow to accept the Change of Control Offer.
13.Denominations
The Notes (including this Note) are in minimum denominations of $1 and integral multiples of $1 in excess thereof of principal amount at maturity and may be transferred only in amounts of $200,000 or greater. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
14.Unclaimed Money
All moneys paid by the Issuer to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such
principal, premium or interest has become due and payable may be repaid to the Issuer, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuer for payment thereof.
15.Discharge and Defeasance
Subject to certain conditions, the Issuer at any time may terminate some or all of its obligations under this Note and each other Note and the Indenture if the Issuer irrevocably deposits with the Trustee dollars or U.S. Government Securities for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
16.Amendment, Supplement and Waiver
(a)(i) The Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolutions to the Trustee) and the Trustee may modify, amend or supplement the Indenture or this Note and each other Note and the Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent and copied to the Trustee) and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Issuer and the assumption by any such successor of the provisions in the Indenture and in this Note and each other Note; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with the provisions of Article Five of the Indenture; provided, further, that such transaction need not be of a specific type identified in Article Five of the Indenture (it being understood that in the case of any other transaction, the requirements of Article Five of the Indenture shall apply mutatis mutandis);
(B)to add to the Issuer’s covenants or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any other obligor upon this Note and each other Note, as applicable, in the Indenture or in the Notes;
(C)to cure any ambiguity, or to correct or supplement any provision herein or in the Notes that may be defective or inconsistent with any other provision herein or in the Notes or to make any other provisions with respect to matters or questions arising under the Indenture or this Note; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Security Documents or this Note to any provision of the “Description of the Notes” section in the Offering Memorandum to the extent that such provision in such “Description of the Notes” section was intended to be a verbatim recitation of a provision of the Indenture, the Security Documents or the Notes;
(E)to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent under the Indenture or any Security Document;
(F)to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuer’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to the Indenture or otherwise to release Collateral from the Liens pursuant to the Indenture and the Security Documents when permitted or required by the Indenture and/or the Security Documents or to modify the Security Documents to secure Additional Notes pursuant to the terms of the Indenture; or
(G)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii)In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
(b)(i) Except as provided in Section 16(b)(ii) of this Note and Section 6.04 of the Indenture and without prejudice to Section 16(a) of this Note, the Issuer and the Trustee may:
(A)modify, amend or supplement the Indenture, the Security Documents or this Note and the other Notes; or
(B)waive compliance by the Issuer with any provision of the Indenture, the Security Documents or this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes) provided that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
(ii)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 16(a) of this Note, may:
(A) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(B) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(C) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(D) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(E) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(F)modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(G)directly or indirectly release the Liens on the Collateral except as permitted by the Indenture and the Security Documents; or
(H) make any change in Section 2 of this Note that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuer agrees to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(c)The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any
amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
17.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in Section 6.01(a)(viii) or (ix) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuer (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note, the other Notes or the Security Documents except as provided in the Indenture. The Trustee and the Security Agent may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations, the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee and the Security Agent in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
18.Ranking
This Note and the other Notes will be general obligations of the Issuer.
19.Security
This Note and the other Notes will be secured by the Security Interests in the Collateral, subject to Permitted Collateral Liens. Reference is made to the Indenture for terms relating to such security, including the release, termination and discharge thereof. The Security Documents and the Collateral will be administered by the Security Agent (or in certain circumstances a sub-agent) pursuant to the Security Documents, for the benefit of all Holders and holders of certain Debt permitted to be secured on the Collateral. The Issuer shall not be required to make any notation on this Note to reflect any grant of such security or any such release, termination or discharge.
20.Trustee Dealings with the Issuer
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuer or any of its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
21.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuer shall not have any liability for any obligations of the Issuer under this Note, the other Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
22.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
23.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24.ISIN, CUSIP and/or Common Code Numbers
The Issuer may cause ISIN, CUSIP or Common Code numbers to be printed on the Notes, and if so the Trustee shall use ISIN, CUSIP and Common Code numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
25.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. THE APPLICATION OF THE PROVISIONS SET OUT IN ARTICLES 470-1 TO 470-19 OF THE LUXEMBOURG LAW ON COMMERCIAL COMPANIES DATED AUGUST 10, 1915, AS AMENDED, TO THIS NOTE IS EXCLUDED.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuer) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuer or any Affiliate of the Issuer, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Issuer or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuer reasonably requests to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of $200,000 or any integral multiple of $1 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
Date of
Increase |
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Increase in
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Principal Amount
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Notation Made by or on Behalf of Registrar |
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EXHIBIT A-2
[FORM OF FACE OF EURO NOTE]
ARD FINANCE S.A.
Société Anonyme
Registered Office: 56, rue Charles Martel, L-2134 Luxembourg
R.C.S. Luxembourg: B 160806
[If Regulation S Euro Global Note – Common Code 207903248 / ISIN XS2079032483]
[If Restricted Euro Global Note – Common Code Number 207903264 / ISIN XS2079032640]
No. [●]
[Include if Global Note — UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF CITIVIC NOMINEES LIMITED AS NOMINEE FOR CITIBANK EUROPE PLC (THE “COMMON DEPOSITARY”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CITIBANK EUROPE PLC, AS COMMON DEPOSITARY OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY (AND ANY PAYMENT IS MADE TO CITIVIC NOMINEES LIMITED OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE COMMON DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CITIVIC NOMINEES LIMITED, HAS AN INTEREST HEREIN.
TRANSFERS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF THE COMMON DEPOSITARY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS CERTIFICATE AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF THIS CERTIFICATE TO REFLECT ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS CERTIFICATE SHALL BE DEEMED, BY THE ACCEPTANCE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE ‘‘U.S. SECURITIES ACT’’) OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS A NON-U.S. PERSON ACQUIRING THIS NOTE IN AN ‘‘OFFSHORE TRANSACTION’’ PURSUANT TO RULE 144A OR RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED NOTES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE ‘‘RESALE RESTRICTION TERMINATION DATE’’) WHICH IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE)] [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE DATE WHEN THE NOTES WERE FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS IN RELIANCE ON REGULATION S AND THE DATE OF THE COMPLETION OF THE DISTRIBUTION] ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A ‘‘QUALIFIED INSTITUTIONAL BUYER’’ AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) FOR UNITED STATES FEDERAL INCOME TAX PURPOSES. PURSUANT TO SECTION 2.16 OF THE INDENTURE, The Issuer agrees, and by acceptance of a beneficial ownership interest in the Notes each Holder of Notes will be deemed to have agreed (in the absence of an administrative pronouncement or judicial ruling to the contrary), for United States federal income tax purposes to treat the Notes as indebtedness of the Company subject to United States Treasury regulations section 1.1275-4 (the “Contingent Debt Regulations”) and, for purposes of the Contingent Debt Regulations, to treat payments received by a Holder on the Notes as a contingent payment. A Holder of Notes may obtain the issue price, Amount of oid, issue date, yield to maturity, comparable yield and the projected payment schedule by submitting a written request for such information to the chief financial officer of ARD Finance S.A. at: Attention: Chief Financial Officer, ARD Finance S.A. at 56, rue Charles Martel, L-2134 Luxembourg, Luxembourg.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES THAT IT SHALL NOT TRANSFER THE SECURITIES IN AN AMOUNT LESS THAN €100,000.
5.000% / 5.750% SENIOR SECURED TOGGLE NOTES DUE 2027
ARD Finance S.A., a public limited liability company (société anonyme) incorporated under the laws of Luxembourg promises to pay to [●] or registered assigns the principal sum of €[●] (as such amount may be increased or decreased as indicated in Schedule A (Schedule of Principal Amount) of this Note) on June 30, 2027.
From [●] or from the most recent Interest Payment Date (as defined in this Note) to which interest has been paid or provided for, interest on this Note will accrue at 5.000% per annum with respect to Cash Interest (as defined in this Note) and, if payment-in-kind interest is payable, 5.750% per annum with respect to PIK Interest (as defined in this Note), payable semi-annually on June 30 and December 30 of each year, beginning on June 30, 2020, to the Person in whose name this Note (or any predecessor Note) is registered at the close of business one business day immediately preceding the related Interest Payment Date.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK without regard to the conflict of law rules thereof. THE APPLICATION OF THE PROVISIONS SET OUT IN ARTICLES 470-1 TO 470-19 OF THE LUXEMBOURG LAW ON COMMERCIAL COMPANIES DATED AUGUST 10, 1915, AS AMENDED, TO THE NOTES IS EXCLUDED.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and to the provisions of the Indenture, which provisions shall for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, ARD Finance S.A. has caused this Note to be signed manually or by facsimile by its duly authorized signatory.
Dated: [●]
ARD FINANCE S.A.
By:
Name:
Title:Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the Indenture.
CITIBANK, N.A., LONDON BRANCH,
as Trustee
By:
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
5.000% / 5.750% SENIOR SECURED TOGGLE NOTES DUE 2027
1.Interest
ARD Finance S.A., a public limited liability company (société anonyme) incorporated under the laws of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 160.806 (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein collectively called the “Issuer”), for value received, promises to pay interest on the principal amount of this Note from [●] at the rate per annum shown above. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Issuer shall pay interest on overdue principal at the interest rate borne by the Notes compounded semi-annually, and it shall pay interest on other overdue amounts at the same rate to the extent lawful. Any interest paid on this Note shall be increased to the extent necessary to pay Additional Amounts as set forth in this Note.
2.Additional Amounts
(a) All payments that the Issuer makes under or with respect to the Notes shall be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including, without limitation, penalties, interest and other similar liabilities related thereto) of whatever nature (collectively, “Taxes”) imposed or levied on such payments by or on behalf of any jurisdiction (other than the United States, any state thereof or the District of Columbia) in which the Issuer is organized, resident or doing business for tax purposes or from or through which it (or its agents, including the Paying Agent) makes any payment on this Note or by or within any department, political subdivision or governmental authority of or in any of the foregoing having power to tax (each, a “Relevant Taxing Jurisdiction”), unless the Issuer or other applicable withholding agent, as the case may be, is required to withhold or deduct Taxes by law or by the interpretation or administration of law. If the Issuer or other applicable withholding agent is required to withhold or deduct any amount for or on account of Taxes imposed or levied on behalf of a Relevant Taxing Jurisdiction from any payment made under or with respect to this Note, the Issuer shall pay additional amounts (“Additional Amounts”) as may be necessary to ensure that the net amount received by each beneficial owner of the Notes after such withholding or deduction (including any withholding or deduction in respect of any Additional Amounts) will not be less than the amount the beneficial owner would have received if such Taxes had not been withheld or deducted.
(b) The Issuer will not, however, pay Additional Amounts in respect or on account of:
(i) any Taxes, to the extent such Taxes are imposed or levied by a Relevant Taxing Jurisdiction by reason of the Person’s in whose name a Note is registered on the Registrar’s books (each such Person, a “Holder”) or beneficial owner’s present or former connection with such Relevant Taxing Jurisdiction (other than the mere receipt, ownership, holding or disposition of this Note, or by reason of the receipt of any payments in respect of any Notes, or the exercise or enforcement of rights under any Notes);
(ii) any Taxes to the extent such Taxes are imposed or withheld by reason of the failure of the Holder or beneficial owner of this Note, following the Issuer’s written request addressed to the Holder or beneficial owner, to comply with any certification, identification, information or other reporting requirements (to the extent such holder or beneficial owner is legally eligible to do so), whether required by statute, treaty, regulation or administrative practice of a Relevant Taxing Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes imposed by the Relevant Taxing Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Relevant Taxing Jurisdiction);
(iii) any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;
(iv) any Tax which is payable otherwise than by deduction or withholding from payments made under or with respect to this Note;
(v) any Tax imposed on or with respect to any payment by the Issuer to the Holder if such Holder is a fiduciary or partnership or Person other than the sole beneficial owner of such payment to the extent that such Taxes would not have been imposed on such payment had such beneficial owner been the holder of such Note;
(vi) any Tax that is imposed on or with respect to a payment made to a Holder or beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant Notes to another paying agent in a member state of the European Union;
(vii) any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Note for payment (where presentation is required) more than 30 days after the relevant payment is first made available to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had this Note been presented on the last day of such 30-day period);
(viii) any U.S. federal withholding Taxes or equivalent thereof imposed pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or other official administrative interpretations thereof and any agreements entered into pursuant to current Section 1471(b)(1) of the U.S. Internal Revenue Code of 1986 as of the Issue Date (or any amended or successor version described above), and including (for the avoidance of doubt) any intergovernmental agreements (and any law, regulation, rule or practice implementing any such intergovernmental agreement) in respect of the foregoing; or
(ix) any combination of the foregoing.
(c) If the Issuer is the applicable withholding agent, the Issuer shall (i) make such withholding or deduction as is required by applicable law and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.
(d) At least 30 calendar days prior to each date on which any payment under or with respect to this Note is due and payable, if the Issuer will be obligated to pay Additional Amounts with respect to such payment (unless such obligation to pay Additional Amounts arises after the 30th day prior to the date on which payment under or with respect to this Note is due and payable, in which case it will be promptly thereafter), the Issuer will deliver to the Trustee, with a copy to the Paying Agent, an Officer’s Certificate stating that such Additional Amounts will be payable and the amounts so payable and will set forth such other information as is necessary to enable the Paying Agent to pay such Additional Amounts to the Holders on the payment date. The Trustee and the Paying Agent shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary. The Issuer shall promptly publish a notice in accordance with Section 12.02 of the Indenture stating that such Additional Amounts will be payable and describing the obligation to pay such amounts. Such Additional Amounts may be paid by the Issuer, at its option, in the form of cash or Additional Notes. To the extent that the Issuer or any applicable withholding agent is required by law or by the interpretation or administration thereof to make any deduction or withholding from any payment of interest on this Note or any payment of an Additional Amount which, in either case, is made through the issuance of Additional Notes, the foregoing provisions shall apply with respect to such withholding or deduction requirement, mutatis mutandis.
In addition, the Issuer will pay any present or future stamp, issuance, registration, court, documentary, excise or property taxes or other similar taxes, charges and duties, including, without limitation, interest, penalties and other similar liabilities with respect thereto, imposed by any Relevant Taxing Jurisdiction in respect of (i) the execution, issue, delivery or registration of this Note or any other document or instrument referred to thereunder, or (ii) the receipt of any payments under or with respect to, or enforcement of, this Note.
Upon written request, the Issuer will furnish to the Trustee or the Principal Paying Agent or a Holder within a reasonable time certified copies of tax receipts evidencing any payment by the Issuer of any Taxes imposed or levied by a Relevant Taxing Jurisdiction, in accordance with the procedures described in Section 12.02 of the Indenture, in such form as provided in the normal course by the taxing authority imposing such Taxes. If, notwithstanding the efforts of the Issuer to obtain such receipts, the same are not obtainable, the Issuer will provide
the Trustee or such Holder with other evidence reasonably satisfactory to the Trustee or holder of such payments by the Issuer. If requested by the Trustee or the Principal Paying Agent, the Issuer will provide to the Trustee or the Principal Paying Agent, as the case may be, such information as may be reasonably available to the Issuer (and not otherwise in the possession of the Trustee or the Principal Paying Agent, as applicable) to enable determination of the amount of any withholding Taxes attributable to any particular Holder(s).
(e) Whenever the Indenture or this Note refers to, in any context, the payment of principal, premium, if any, interest or any other amount payable under or with respect to this Note, such reference includes the payment of Additional Amounts, if applicable.
(f) The preceding provisions will survive any termination, defeasance or discharge of the Indenture and shall apply mutatis mutandis to any jurisdiction in which any successor Person to any of the Issuer is organized, resident or doing business for tax purposes or any jurisdiction from or through which any such person (or its agents, including the Paying Agent) makes any payment on this Note and any department, political subdivision or governmental authority of or in any of the foregoing having the power to tax.
3.Method of Payment
The Issuer shall pay interest on this Note (except defaulted interest) to the persons who are registered Holders of this Note at the close of business on the Record Date for the next stated maturity of an installment of interest on the Note (an “Interest Payment Date”) even if this Note is cancelled after the Record Date and on or before the Interest Payment Date. The Issuer shall pay principal and interest in dollars in immediately available funds that at the time of payment is legal tender for payment of public and private debts; provided that payment of interest may be made at the option of the Issuer by check mailed to the Holder.
The amount of payments in respect of interest on each Interest Payment Date shall correspond to the aggregate principal amount of Notes represented by the Regulation S Global Note and the Restricted Global Note, as established by the Registrar at the close of business on the relevant Record Date. Payments of principal shall be made upon surrender of the Regulation S Global Note and the Restricted Global Note to the Paying Agent.
In the case of the payment of PIK Interest, including in the event of payment of Additional Amounts, the Issuer may elect to either increase the outstanding principal amount of the Notes or issue additional Notes (the “Dollar PIK Interest Notes,” in the case of the Dollar Notes, and the “Euro PIK Interest Notes,” in the case of the Euro Notes and, together, the “PIK Interest Notes”) under the Indenture having the same terms as this Note (in each case, a “PIK Payment”).
Except as provided in the immediately succeeding sentence and the definition of “Cash Available for Debt Service,” interest on this Note shall be payable entirely in cash (“Cash Interest”). For any interest period after the initial interest period (other than the final interest period ending at stated maturity), if the Cash Available for Debt Service (as defined below) as determined by the Issuer on the Determination Date (as defined below) for such interest period:
(i)equals or exceeds 75%, but is less than 100% of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 25% of the then outstanding principal amount of the Notes by increasing the principal amount of the outstanding Notes or by issuing Additional Notes in a principal amount equal to such interest (“PIK Interest”);
(ii)is equal to or exceeds 50%, but is less than 75%, of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 50% of the then outstanding principal amount of the Notes as PIK Interest;
(iii) is equal to or exceeds 25%, but is less than 50%, of the aggregate amount of Cash Interest would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 75% of the then outstanding principal amount of the Notes as PIK Interest; or
(iv) is less than 25% of the aggregate amount of Cash Interest that would otherwise be due on the relevant Interest Payment Date, then the Issuer may, at its option, elect to pay interest on up to 100% of the then outstanding principal amount of the Notes as PIK interest.
As used herein:
“Cash Available for Debt Service” shall be the amount equal to the sum (without duplication) of:
(i) all cash and Cash Equivalents on hand at the Issuer as of such Determination Date (other than (x) any cash and Cash Equivalents the distribution of which was conditioned upon such cash and Cash Equivalents being used for a purpose other than paying Cash Interest, (y) any amounts on deposit in the Escrow Account and (z) an amount necessary to maintain the corporate existence of the Issuer and its Subsidiaries, to pay any amounts the Issuer may be required to pay in relation to taxes, assessments, governmental charges or similar obligations and to carry out activities not prohibited by the Notes and the Indenture), which amount shall in no event be less than $0 (provided that there shall be excluded from this clause (i) any net proceeds from the Notes and any cash and Cash Equivalents on hand to be used for payment of interest on the Notes on the Interest Payment Date immediately succeeding such Determination Date); and
(ii)the maximum amount of all dividends and other distributions that, as of the applicable Determination Date, would be lawfully permitted to be paid to the Issuer (with respect to any Subsidiary that is not a wholly owned Subsidiary, pro rata for the economic interest of the Issuer in the Qualified Capital Stock such Subsidiary), if any, for the purpose of paying Cash Interest by all Restricted Subsidiaries of the Issuer after giving effect to all corporate, shareholder or other comparable actions (including fiduciary and other directors’ duties) required in order to make such payment, requirements under applicable law and all restrictions or limitations on the ability to make such dividends or distributions that are otherwise permitted by the “adjusted net income”, “general basket” and similar provisions (but excluding all other carve outs and baskets) of the “restricted payments” and similar restrictive covenants and provisions in financing or other contractual arrangements (including joint venture agreements and shareholder agreements) of any Subsidiary or any of its Restricted Subsidiaries or any agreement that amends, modifies, renews, increases, supplements, refunds, replaces or refinances such financing or other contractual arrangements in the manner prescribed by such covenant), net of all taxes attributable primarily to such dividend or distribution, if any.
To the extent the Issuer is required to pay Cash Interest for all or any portion of the interest due on any Interest Payment Date, the Issuer shall and shall cause each of the Restricted Subsidiaries, without prejudice to fiduciary or other directors’ duties, to take all such shareholder, corporate and other actions necessary or appropriate to permit the making of any such dividends or other distribution or other form of return on capital provided that any such shareholder and corporate and other actions would not violate applicable law.
“Determination Date” shall mean, with respect to each interest period following the first interest period, the seventh calendar day immediately prior to the first day of the relevant interest period.
In the event that the Issuer is entitled to pay PIK Interest for any interest period, then the Issuer shall deliver a notice to the Trustee and each Paying Agent following the Determination Date but not less than five (5) Business Days prior to the commencement of the relevant interest period, which notice shall state the total amount of interest to be paid on such Interest Payment Date and the amount of such interest to be paid as PIK Interest. The Trustee or the Principal Paying Agent, as the case may be, shall promptly deliver the same notice to the Holders. Notwithstanding the foregoing, the delivery of such notice to the Trustee and the Paying Agents shall not restrict the Issuer’s ability to pay, at its option, a greater portion of the interest on this Note with respect to such interest period as Cash Interest in which case the Issuer shall deliver a notice to that effect to the Trustee and each Paying Agent no later than five (5) Business Days prior to the Interest Payment Date of the relevant interest period. Interest for the first interest period commencing on the Issue Date shall be payable entirely in Cash Interest. Interest for the final interest period ending at stated maturity shall be payable entirely in Cash Interest.
4.Paying Agent and Registrar
Initially, Citibank, N.A., London Branch or one of its affiliates will act as Principal Paying Agent and Citigroup Global Markets Europe AG will act as Registrar. The Issuer or any of its Affiliates may act as Paying Agent, Registrar or co-Registrar.
5.Indenture
The Issuer issued this Note under an indenture dated as of November 20, 2019 (the “Indenture”) among the Issuer, Citibank, N.A., London Branch, as trustee (the “Trustee”), as principal paying agent (the “Principal Paying Agent”) and as Transfer Agent, Citibank, N.A., London Branch, as security agent (the “Security Agent”), and Citigroup Global Markets Europe AG, as Registrar. The terms of this Note include those stated in the Indenture. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. This Note is subject to all such terms, and Holders are referred to the Indenture for a statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture imposes certain limitations on the Issuer and its Affiliates, including, without limitation, limitations on the incurrence of indebtedness and issuance of stock, the payment of dividends and other payment restrictions affecting its Restricted Subsidiaries, the sale of assets, transactions with and among Affiliates of the Issuer and its Restricted Subsidiaries, Change of Control and Liens.
6.Redemption
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(a) Optional Redemption Prior to November 15, 2022: At any time and from time to time, prior to November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer may redeem all or part of this Note, at a Redemption Price equal to 100% of the principal amount hereof plus the Applicable Redemption Premium and accrued and unpaid interest to the Redemption Date (subject to the rights of Holders on the relevant Record Date to receive interest on the relevant Interest Payment Date). |
“Applicable Redemption Premium” means, with respect to any Note on any Redemption Date, the greater of:
(1) 1.0% of the principal amount of such Notes; or
(2) the excess of:
(i) the present value at such redemption date of (x) the redemption price of the Note at November 15, 2022, (such redemption price being set forth in the table appearing in paragraph (c) below) plus (y) all required interest payments that would otherwise be due to be paid on such Notes during the period between the redemption date and November 15, 2022 (excluding accrued but unpaid interest), computed using a discount rate equal to the Bund Rate as of such Redemption Date plus 50 basis points; over
(ii) the outstanding principal amount of such Notes.
For the avoidance of doubt, calculation of the Applicable Redemption Premium shall not be a duty or obligation of the Trustee or any paying agent. Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
“Bund Rate” means, with respect to any redemption date, the rate per annum equal to the equivalent yield to maturity as of such redemption date of the Comparable German Bund Issue, assuming a price for the Comparable German Bund Issue (expressed as a percentage of its principal amount) equal to the Comparable German Bund Price for such redemption date, where:
(i)“Comparable German Bund Issue” means the German Bundesanleihe security selected by any Reference German Bund Dealer as having a fixed maturity most nearly equal to the period from such redemption date to November 15, 2022, and that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of euro denominated corporate debt securities in a principal amount approximately equal to the then outstanding principal amount of the Euro Notes and of a maturity most nearly equal to November 15, 2022; provided that if the period from such redemption date to November 15, 2022 is less than one year, a fixed maturity of one year will be used;
(ii)“Comparable German Bund Price” means, with respect to any redemption date, the average of the Reference German Bund Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference German Bund Dealer Quotations, or if the Issuer obtains fewer than four such Reference German Bund Dealer Quotations, the average of all such quotations;
(iii)“Reference German Bund Dealer” means any dealer of German Bundesanleihe securities appointed by the Issuer (and notified to the Trustee); and
(iv)“Reference German Bund Dealer Quotations” means, with respect to each Reference German Bund Dealer and any redemption date, the average as determined by the Issuer of the bid and offered prices for the Comparable German Bund Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Issuer by such Reference German Bund Dealer at 3:30 p.m. Frankfurt, Germany time on the third Business Day preceding such redemption date.
(b)Mandatory Redemption on November 15, 2022: Upon not less than 10 nor more than 60 days’ notice, on November 15, 2022, the Issuer shall redeem the maximum aggregate principal amount of (i) this Note and (ii) all other Notes issued pursuant to the Indenture, on a pro rata basis, that could be purchased with all cash and Cash Equivalents deposited in the Escrow Account (after deducting the reasonable fees and expenses of such redemption from such deposited amounts) at a purchase price equal to 104% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest to the redemption date (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). In connection with such redemption, the Issuer shall redeem this Note and all other Notes subject to such redemption on a pro rata basis based on the aggregate principal amount of such Notes outstanding as of the date of redemption. This redemption is subject to the right of Holders of record on the relevant record date that is prior to the redemption date to receive interest due on an Interest Payment Date.
(c)Optional Redemption on or after November 15, 2022: At any time and from time to time on or following November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer may redeem all or part of the Notes. These redemptions will be in a minimum amount of €100,000 and in minimum denominations of €1 or integral multiples thereof, at the following Redemption Prices (expressed as percentages of their principal amount at maturity), plus accrued and unpaid interest, if any, to the Redemption Date, if redeemed during the 12-month period commencing on November 15 of the years set forth below (subject to the right of Holders of record on the relevant Record Date that is prior to the Redemption Date to receive interest due on an Interest Payment Date).
Year |
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Redemption Price Euro Notes |
2019..................................................................................................................... |
102.500% |
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2020..................................................................................................................... |
101.250% |
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2021 and thereafter............................................................................................. |
100.000% |
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
7.Mandatory Offers and Redemptions with Net Cash Proceeds from Pledged Company Share Sales
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(a) Mandatory Offers prior to November 15, 2022: At any time prior to November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer shall make an offer to repurchase this Note with the Net Cash Proceeds from the sales by the Issuer or any Intermediate Holding Company (other than (i) sales by the Issuer to an Intermediate Holding Company or by an Intermediate Holding Company to the Issuer or another Intermediate Holding Company; provided that, in each case under this clause (i), the purchaser thereof grants a Lien over the relevant Qualified Capital Stock to secure the Notes or (ii) in connection with a Permitted Reorganization) of Qualified Capital Stock of any Pledged Company (a “Pledged Company Share Sale”) at a purchase price (expressed as a percentage of their principal amount at maturity) equal to or greater than 104% (as determined by the Issuer) of the principal amount of the Notes being repurchased, plus accrued and unpaid interest to the purchase date (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). |
To the extent that the aggregate purchase amount (including premium and accrued and unpaid interest) in respect of all Notes tendered pursuant to a mandatory offer as a result of a Pledged Company Share Sale is less than the aggregate amount of Net Cash Proceeds from the applicable Pledged Company Share Sale, the Issuer shall promptly deposit such excess amount into the Escrow Account.
(b)Mandatory Redemptions on or after November 15, 2022: At any time on or after November 15, 2022, upon not less than 10 nor more than 60 days’ notice, the Issuer shall redeem this Note, along with all other Notes issued pursuant to the Indenture on a pro rata basis, with the Net Cash Proceeds from any Pledged Company Share Sale in accordance with the provisions set forth in paragraph 6(c) above. In connection with such redemption, the Issuer shall redeem this Note and all other Notes subject to such redemption on a pro rata basis based on the aggregate principal amount of such Notes outstanding on the date of redemption.
8.Escrow Offers
To the extent any amounts deposited in the Escrow Account have not been subject to an Escrow Offer, on or within 30 days following each of November 15, 2020 and November 15, 2021 as determined by the Issuer (each an “Escrow Offer Trigger Date”), upon not less than 10 nor more than 60 days’ notice, the Issuer shall make an Escrow Offer to repurchase this Note and all other Notes issued pursuant to the Indenture, on a pro rata basis, with such amounts (less the reasonable fees and expenses relating to such Escrow Offer) (in each case, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date). In connection with such Escrow Offer, the Issuer shall offer to purchase this Note and all other Notes subject to such
Escrow Offer on a pro rata basis based on the aggregate principal amount of such Notes outstanding as of the date of such Escrow Offer.
9.Procedures for Mandatory Offers to Purchase Notes
Within five Business Days following a Pledged Company Share Sale prior to November 15, 2022 or on or before each Escrow Offer Trigger Date (to the extent an Escrow Offer is then required), the Issuer will:
(a)cause a notice of the mandatory offer to be (i) delivered to Holders (with a copy to the Trustee) electronically or mailed by first‑class mail, postage prepaid; and (ii) if at the time of such notice the Notes are listed on Euronext Dublin and the rules of Euronext Dublin so require, published in The Irish Times (or another leading newspaper of general circulation in Ireland or, to the extent and in the manner permitted by the rules of Euronext Dublin, posted on the official website of Euronext Dublin); and
(b)send notice of the mandatory offer by first class mail, with a copy to the Trustee, to each Holder to the address of such Holder appearing in the security register, which notice will state:
(i)that a Pledged Company Share Sale or an Escrow Offer Trigger Date has occurred, and the date it occurred;
(ii)the purchase price for the mandatory offer and the purchase date, which will be a Business Day no earlier than 10 days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act and any applicable securities laws or regulations;
(iii)that any Note accepted for payment pursuant to the mandatory offer will cease to accrue interest after the purchase date unless the purchase price is not paid;
(iv)that any Note (or part thereof) not tendered will continue to accrue interest; and
(v)any other procedures that a Holder must follow to accept such mandatory offer or to withdraw such acceptance (which procedures may also be performed at the office of the paying agent in Ireland as long as the Notes are listed on Euronext Dublin).
The Trustee will promptly authenticate and deliver a new Note or Notes equal in principal amount to any unpurchased portion of Notes surrendered, if any, to the Holder of Notes in global form or to each Holder of certificated Notes; provided that each such new Note or Notes will be in a total principal amount of at least €100,000 and in minimum denominations of €1 or integral multiples thereof. The Issuer will publicly announce the results of a mandatory offer on or as soon as practicable after the applicable purchase date.
Notwithstanding anything to the contrary contained herein, with respect to any Pledged Company Share Sale, such mandatory offer may be made in advance of a Pledged Company Share Sale, conditioned upon, among other things, the consummation of such Pledged Company Share Sale.
The Issuer’s offer shall be made to Holders on a pro rata basis based on the aggregate principal amount of the Notes outstanding on the date of such offer; provided that in the event that aggregate purchase amount for this Note, as applicable, tendered by Holders is less than the aggregate purchase amount in respect of the Note offered to be purchased, the Issuer may apply any additional Net Cash Proceeds not used to purchase this Note to purchase Notes denominated in the other currency if the aggregate purchase amount for Notes in such other currency that are tendered by Holders in such offer exceeds the amount of Net Cash Proceeds that would have otherwise been available to repurchase such Notes of such other currency.
If the aggregate purchase amount (including premium and accrued and unpaid interest) in respect of Notes validly tendered and not withdrawn by Holders thereof exceeds the aggregate amount of Net Cash Proceeds from the
applicable Pledged Company Share Sale (after giving effect to the immediately preceding paragraph), the Notes to be purchased will be selected by a method that complies with the requirements, as certified to the Trustee by the Issuer, of the principal securities exchange, if any, on which the Notes are listed at such time, and in compliance with the requirements of the relevant clearing system or, if the Notes are not listed on a securities exchange, or such securities exchange prescribes no method of selection and the Notes are not held through clearing system or the clearing system prescribes no method of selection, by lot.
Any offer to purchase may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
10.Redemption Upon Changes in Withholding Taxes
This Note and the other Global Notes may also be redeemed together, in whole but not in part, at the election of the Issuer, upon not less than 10 nor more than 60 days’ notice which notice shall be irrevocable and given in accordance with the procedures described in Section 12.02 of the Indenture, at the Redemption Price equal to 100% of their principal amount, plus accrued and unpaid interest, if any to the Redemption Date if, as a result of (a) any amendment to, or change in, the laws (or regulations or rulings promulgated thereunder) of any Relevant Taxing Jurisdiction which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) or, (b) any change which is announced and becomes effective after the Issue Date (or, where such Relevant Taxing Jurisdiction became a Relevant Taxing Jurisdiction at a later date, after such later date) in the official interpretation or official application of such laws, regulations or rulings (including by virtue of a holding, judgment or order by a court of competent jurisdiction) of any Relevant Taxing Jurisdiction (each of the foregoing clauses (a) and (b), a “Change in Tax Law”), the Issuer would be obligated to pay, on the next date for any payment and as a result of that amendment or change, Additional Amounts (as described above in Paragraph 2), with respect to the Relevant Taxing Jurisdiction, which the Issuer cannot avoid by the use of reasonable measures available to the Issuer. Prior to the giving of any notice of redemption pursuant to this paragraph, the Issuer shall deliver to the Trustee (a) an Officer’s Certificate stating that the obligation to pay Additional Amounts cannot be avoided by the Issuer taking reasonable measures available to it, and (b) a written opinion of independent tax counsel to the Issuer of recognized standing qualified under the laws of the Relevant Taxing Jurisdiction and reasonably satisfactory to the Trustee to the effect that the Issuer has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
The Trustee will accept such Officer’s Certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, without further inquiry, in which event it will be conclusive and binding on the Holders.
Notwithstanding the foregoing, no such notice of redemption will be given (a) earlier than 90 days prior to the earliest date on which the Issuer would be obliged to make such payment of Additional Amounts if a payment in respect of the Notes were then due and (b) unless at the time such notice is given, the obligation to pay Additional Amounts remains in effect.
Any redemption and notice may, in the Issuer’s discretion, be subject to the satisfaction of one or more conditions precedent.
11.Notice of Redemption
Notice of redemption will be mailed first-class postage prepaid at least 10 days but not more than 60 days before the Redemption Date to the Holder of this Note to be redeemed at the addresses contained in the Security Register. If this Note is in a denomination larger than €100,000 of principal amount at maturity it may be redeemed in part but only in integral multiples of €1 at maturity. In the event of a redemption of less than all of the Notes, the Notes for redemption will be chosen by the Trustee in accordance with the Indenture. If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above, then any accrued interest will be paid to the Holder at the close of business on such Record Date. If money sufficient to pay the Redemption Price of and accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is deposited
with the applicable Paying Agent on or before the Redemption Date and certain other conditions are satisfied, interest ceases to accrue on such Notes (or such portions thereof) called for redemption on or after such date.
12.Repurchase at the Option of Holders
If a Change of Control occurs at any time, the Issuer shall offer to purchase on the Change of Control Purchase Date all or any part (equal to €100,000 or an integral multiple of €1 in excess thereof) of this Note at a purchase price in cash in an amount equal to 101% of the principal amount hereof, plus any accrued and unpaid interest, if any, to the Change of Control Purchase Date (subject to the rights of Holders of record on the relevant Record Dates to receive interest due on the relevant Interest Payment Date); provided that the Issuer shall not be required to make a Change of Control Offer if, when a Change of Control occurs, it has given notice of its intention to redeem all of the Notes pursuant to Section 6(a), “Optional Redemption Prior to November 15, 2022” or Section 6(c), “Optional Redemption on or after November 15, 2022” of this Note. The Issuer shall purchase all Notes properly and timely tendered in the Change of Control Offer and not withdrawn in accordance with the procedures set forth in such notice. The Change of Control Offer will state, among other things, the procedures that Holders must follow to accept the Change of Control Offer.
13.Denominations
The Notes (including this Note) are in minimum denominations of €1 and integral multiples of €1 in excess thereof of principal amount at maturity and may be transferred only in amounts of €100,000 or greater. The transfer of Notes (including this Note) may be registered, and Notes (including this Note) may be exchanged, as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
14.Unclaimed Money
All moneys paid by the Issuer to the Trustee or a Paying Agent for the payment of the principal of, or premium, if any, or interest on, this Note or any other Note that remain unclaimed at the end of two years after such principal, premium or interest has become due and payable may be repaid to the Issuer, subject to applicable law, and the Holder of such Note thereafter may look only to the Issuer for payment thereof.
15.Discharge and Defeasance
Subject to certain conditions, the Issuer at any time may terminate some or all of its obligations under this Note and each other Note and the Indenture if the Issuer irrevocably deposits with the Trustee euros or European Government Obligations for the payment of principal and interest on the Notes to redemption or maturity, as the case may be.
16.Amendment, Supplement and Waiver
(a)(i) The Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolutions to the Trustee) and the Trustee may modify, amend or supplement the Indenture or this Note and each other Note and the Issuer, when authorized by a resolution of its Board of Directors (as evidenced by the delivery of such resolution to the Security Agent and copied to the Trustee) and the Security Agent may modify, amend or supplement any Security Document, in each case without notice to or consent of any Holder:
(A)to evidence the succession of another Person to the Issuer and the assumption by any such successor of the provisions in the Indenture and in this Note and each other Note; provided that such successor Person would have been permitted to so succeed in a transaction that would have complied with the provisions of Article Five of the Indenture; provided, further, that such transaction need not be of a specific type identified in Article Five of the Indenture (it being understood that in the case of any other transaction, the requirements of Article Five of the Indenture shall apply mutatis mutandis);
(B)to add to the Issuer’s covenants or any other obligor upon this Note and each other Note for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any other obligor upon this Note and each other Note, as applicable, in the Indenture or in the Notes;
(C)to cure any ambiguity, or to correct or supplement any provision herein or in the Notes that may be defective or inconsistent with any other provision herein or in the Notes or to make any other provisions with respect to matters or questions arising under the Indenture or this Note; provided that, in each case, such provisions shall not adversely affect the rights of the Holders in any material respect;
(D)to conform the text of the Indenture, the Security Documents or this Note to any provision of the “Description of the Notes” section in the Offering Memorandum to the extent that such provision in such “Description of the Notes” section was intended to be a verbatim recitation of a provision of the Indenture, the Security Documents or the Notes;
(E)to evidence and provide the acceptance of the appointment of a successor Trustee or Security Agent under the Indenture or any Security Document;
(F)to mortgage, pledge, hypothecate or grant a security interest in favor of the Trustee for the benefit of the Holders as additional security for the payment and performance of the Issuer’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee pursuant to the Indenture or otherwise to release Collateral from the Liens pursuant to the Indenture and the Security Documents when permitted or required by the Indenture and/or the Security Documents or to modify the Security Documents to secure Additional Notes pursuant to the terms of the Indenture; or
(G)to provide for the issuance of Additional Notes in accordance with and if permitted by the terms and limitations set forth in the Indenture.
(ii)In formulating its opinion on such matters, the Trustee shall be entitled to require and rely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
(b)(i) Except as provided in Section 16(b)(ii) of this Note and Section 6.04 of the Indenture and without prejudice to Section 16(a) of this Note, the Issuer and the Trustee may:
(A)modify, amend or supplement the Indenture, the Security Documents or this Note and the other Notes; or
(B)waive compliance by the Issuer with any provision of the Indenture, the Security Documents or this Note and the other Notes,
with the written consent of the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or in exchange for the Notes) provided that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of not less than a majority in principal amount of the then outstanding Notes of such series shall be required.
(ii)Without the consent of the Holders of 90% of the outstanding Notes (provided, however, that if any amendment, waiver or other modification will only affect one series of the Notes, only the consent of the Holders of at least 90% of the aggregate principal amount of such series shall be required (and not the consent of at least 90% of the aggregate principal amount of all Notes then outstanding)), with respect to any such Notes held by a non-consenting Holder, no amendment, modification, supplement or waiver, including a waiver pursuant to Section 6.04 of the Indenture and an amendment, modification or supplement pursuant to Section 16(a) of this Note, may:
(A) change the Stated Maturity of the principal of, or any installment of any Additional Amounts or interest on, any Note;
(B) reduce the principal amount of any Note (or Additional Amounts or premium, if any) or the rate of or change the time for payment of interest on any Note;
(C) change the coin or currency in which the principal of any Note or any premium or any Additional Amounts or the interest thereon is payable;
(D) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);
(E) reduce the principal amount of the outstanding Notes, the consent of whose Holders is required for any amendment or supplement to, or waiver or compliance with, certain provisions of the Indenture;
(F) modify any of the provisions of Article Nine of the Indenture or any provisions in the Indenture relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Notes required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby;
(G) directly or indirectly release the Liens on the Collateral except as permitted by the Indenture and the Security Documents; or
(H) make any change in Section 2 of this Note that adversely affects the rights of any Holder or amend the terms of the Notes or the Indenture in a way that would result in a loss of an exemption from any of the Taxes described thereunder or an exemption from any obligation to withhold or deduct Taxes so described thereunder unless the Issuer agrees to pay Additional Amounts (if any) in respect thereof in the supplemental indenture.
(c) The consent of the Holders will not be necessary under the Indenture to approve the particular form of any proposed amendment, modification, supplement, waiver or consent. It is sufficient if such consent approves the substance of the proposed amendment, modification, supplement, waiver or consent. A consent to any amendment or waiver under the Indenture by any Holder given in connection with a tender of such Holder’s Notes will not be rendered invalid by such tender.
17.Defaults and Remedies
This Note and the other Notes have the Events of Default as set forth in Section 6.01 of the Indenture. If an Event of Default (other than an Event of Default specified in Section 6.01(a)(viii) or (ix) of the Indenture) occurs and is continuing, the Trustee or the registered Holders of not less than 30% in aggregate principal amount of the Notes then outstanding by written notice to the Issuer (and to the Trustee if such notice is given by the Holders), subject to certain limitations, may, and the Trustee, upon the written request of such Holders shall, declare this Note and the other Notes, and any Additional Amounts and accrued interest, to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default and shall result in this Note and the other Notes being due and payable immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture, this Note, the other Notes or the Security Documents except as provided in the Indenture. The Trustee and the Security Agent may refuse to enforce the Indenture, this Note or the other Notes unless it receives security and/or indemnity (including by way of pre-funding) reasonably satisfactory to it. Subject to certain limitations, the Holders of a majority in aggregate principal amount of the Notes may direct the Trustee and the Security Agent in its exercise of any trust or power. The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration and its consequence if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of such acceleration. The above description of Events of Default and remedies is qualified by reference, and subject in its entirety, to the provisions of the Indenture.
18.Ranking
This Note and the other Notes will be general obligations of the Issuer.
19.Security
This Note and the other Notes will be secured by the Security Interests in the Collateral, subject to Permitted Collateral Liens. Reference is made to the Indenture for terms relating to such security, including the release, termination and discharge thereof. The Security Documents and the Collateral will be administered by the Security Agent (or in certain circumstances a sub-agent) pursuant to the Security Documents, for the benefit of all Holders and holders of certain Debt permitted to be secured on the Collateral. The Issuer shall not be required to make any notation on this Note to reflect any grant of such security or any such release, termination or discharge.
20.Trustee Dealings with the Issuer
The Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuer or any of its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-Registrar or co-Paying Agent may do the same with like rights.
21.No Recourse Against Others
A director, officer, employee, incorporator, member or shareholder, as such, of the Issuer shall not have any liability for any obligations of the Issuer under this Note, the other Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting a Note, each Holder shall waive and release all such liability. The waiver and release are part of the consideration for issuance of the Notes.
22.Authentication
This Note shall not be valid until an authorized officer of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note.
23.Abbreviations
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24.ISIN, CUSIP and/or Common Code Numbers
The Issuer may cause ISIN, CUSIP or Common Code numbers to be printed on the Notes, and if so the Trustee shall use ISIN, CUSIP and Common Code numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed on the Notes.
25.Governing Law
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. THE APPLICATION OF THE PROVISIONS SET OUT IN ARTICLES 470-1 TO 470-19 OF THE LUXEMBOURG LAW ON COMMERCIAL COMPANIES DATED AUGUST 10, 1915, AS AMENDED, TO THIS NOTE IS EXCLUDED.
ASSIGNMENT FORM
To assign and transfer this Note, fill in the form below:
(I) or (the Issuer) assign and transfer this Note to
(Insert assignee’s social security or tax I.D. no.)
(Print or type assignee’s name, address and postal code)
and irrevocably appoint ______________________________________ agent to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Date: _______________________________________________________
Certifying Signature:
In connection with any transfer of any Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which the Notes were owned by the Issuer or any Affiliate of the Issuer, the undersigned confirms that such Notes are being transferred in accordance with the transfer restrictions set forth in such Notes and:
CHECK ONE BOX BELOW
(1)☐to the Issuer or any Subsidiary; or
(2)☐pursuant to an effective registration statement under the U.S. Securities Act of 1933; or
(3)☐pursuant to and in compliance with Rule 144A under the U.S. Securities Act of 1933; or
(4)☐pursuant to and in compliance with Regulation S under the U.S. Securities Act of 1933; or
(5)☐pursuant to another available exemption from the registration requirements of the U.S. Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) is checked, by executing this form, the Transferor is deemed to have certified that such Notes are being transferred to a person it reasonably believes is a “qualified institutional buyer” as defined in Rule 144A under the U.S. Securities Act of 1933 who has received notice that such transfer is being made in reliance on Rule 144A; if box (4) is checked, by executing this form, the Transferor is deemed to have certified that such transfer is made pursuant to an offer and sale that occurred outside the United States in compliance with Regulation S under the U.S. Securities Act; and if box (5) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Issuer reasonably requests to confirm that such transfer is being made pursuant to an exemption from or in a transaction not subject to, the registration requirements of the U.S. Securities Act of 1933.
Signature: _________________________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
Certifying Signature: __________________ Date:______________________
Signature Guarantee: __________________________________________________________
(Participant in a recognized signature guarantee medallion program)
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased pursuant to Section 4.09 or 4.11 of the Indenture, check the box: ☐
If the purchase is in part, indicate the portion (in denominations of €100,000 or any integral multiple of €1 in excess thereof) to be purchased:
Your Signature: ____________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Date:
Certifying Signature: ______________________________________
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The following decreases/increases in the principal amount of this Security have been made:
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Notation Made by or on Behalf of Registrar |
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EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM RESTRICTED
GLOBAL NOTE TO REGULATION S GLOBAL NOTE.*
(Transfers pursuant to § 2.06(b)(ii) of the Indenture)
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re:[6.500% / 7.250% Senior Secured Toggle Notes due 2027]/
[5.000% / 5.750% Senior Secured Toggle Notes due 2027] (the “Notes”)
Reference is hereby made to the Indenture dated as of November 20, 2019 (the “Indenture”) among ARD Finance S.A., as Issuer, Citibank, N.A., London Branch, as Trustee, as Principal Paying Agent and as Transfer Agent, Citibank, N.A., London Branch, as Security Agent, and Citigroup Global Markets Europe AG, as Registrar. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to [€][$]____________ aggregate principal amount of Notes that are held as a beneficial interest in the form of the Restricted Global Note ([CUSIP No. [●]][Common Code No. [●]]; ISIN No: [●]) with [DTC/the Common Depository] in the name of [name of transferor] (the “Transferor”). The Transferor has requested an exchange or transfer of such beneficial interest for an equivalent beneficial interest in the Regulation S Global Note ([CUSIP No. [●]][Common Code No. [●]]; ISIN No: [●]).
In connection with such request, the Transferor does hereby certify that such transfer has been effected in accordance with the transfer restrictions set forth in the Notes and:
(a)with respect to transfers made in reliance on Regulation S (“Regulation S”) under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), does certify that:
(i)the offer of the Notes was not made to a person in the United States;
(ii)either (i) at the time the buy order is originated the transferee is outside the United States or the Transferor and any person acting on its behalf reasonably believe that the transferee is outside the United States or; (ii) the transaction was executed in, on or through the facilities of a designated offshore securities market described in paragraph (b) of Rule 902 of Regulation S and neither the Transferor nor any person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States
(iii)no directed selling efforts have been made in the United States by the Transferor, an affiliate thereof or any person their behalf in contravention of the requirements of Rule 903 or 904 of Regulation S, as applicable;
(iv)the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act; and
(v)the Transferor is not the Issuer, a distributor of the Notes, an affiliate of the Issuer or any such distributor (except any officer or director who is an affiliate solely by virtue of holding such position) or a person acting on behalf of any of the foregoing.
(b)with respect to transfers made in reliance on Rule 144 the Transferor certifies that the Notes are being transferred in a transaction permitted by Rule 144 under the U.S. Securities Act.
You, the Issuer and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attn:
____________________
*If the Note is a Definitive Note, appropriate changes need to be made to the form of this transfer certificate.
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER FROM REGULATION S
GLOBAL NOTE TO RESTRICTED GLOBAL NOTE
(Transfers pursuant to § 2.06(b)(iii) of the Indenture)
Citibank, N.A., London Branch
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Attention: Transfer Agent
Re:[6.500% / 7.250% Senior Secured Toggle Notes due 2027]/
[5.000% / 5.750% Senior Secured Toggle Notes due 2027] (the “Notes”)
Reference is hereby made to the Indenture dated as of November 20, 2019 (the “Indenture”) among ARD Finance S.A., as Issuer, Citibank, N.A., London Branch, as Trustee, as Principal Paying Agent and as Transfer Agent, Citibank, N.A., London Branch, as Security Agent, and Citigroup Global Markets Europe AG, as Registrar. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.
This letter relates to [€][$]__________ aggregate principal amount at maturity of Notes that are held in the form of the Regulation S Global Note with [DTC/the Common Depositary] ([CUSIP No.: [●]] [Common Code No. [●]]; ISIN No. [●]) in the name of [name of transferor] (the “Transferor”) to effect the transfer of the Notes in exchange for an equivalent beneficial interest in the Restricted Global Note ([CUSIP No.: [●]][Common Code No. [●]]; ISIN No. [●]).
In connection with such request, and in respect of such Notes the Transferor does hereby certify that such Notes are being transferred in accordance with the transfer restrictions set forth in the Notes and that:
CHECK ONE BOX BELOW:
☐the Transferor is relying on Rule 144A under the Securities Act for exemption from such Act’s registration requirements; it is transferring such Notes to a person it reasonably believes is a QIB as defined in Rule 144A that purchases for its own account, or for the account of a qualified institutional buyer, and to whom the Transferor has given notice that the transfer is made in reliance on Rule 144A and the transfer is being made in accordance with any applicable securities laws of any state of the United States; or
☐the Transferor is relying on an exemption other than Rule 144A from the registration requirements of the Securities Act, subject to the Issuer’s and the Trustee’s right prior to any such offer, sale or transfer to require the delivery of an Opinion of Counsel, certification and/or other information satisfactory to each of them.
You, the Issuer and the Trustee are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.
[Name of Transferor]
By:
Name:
Title:
Date:
cc:
Attn: