This excerpt taken from the LPX 8-K filed Mar 11, 2009.
Indenture relating to the 2017 Notes
On March 10, 2009, the Company and certain of its subsidiaries entered into the Indenture (the 2017 Notes Indenture), with Bank of New York, as trustee (the Trustee), in connection with the issuance of $375,000,000 principal amount at maturity of 13% senior secured notes due 2017 (the 2017 Notes) as part of the Companys offer and sale of units (the Units) consisting of the 2017 Notes and warrants to purchase shares of Company common stock (the Warrants).
The Company will be required to pay interest on the 2017 Notes each March 15 and September 15, beginning September 15, 2009. The 2017 Notes will mature on March 15, 2017. The Company may redeem the 2017 Notes, in whole or in part, on or after March 15, 2013, at the redemption prices described in the Indenture, and prior to March 15, 2013, at a redemption price equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the redemption date, plus a make-whole premium. The Company will be required to redeem a portion of each 2017 Note on September 14, 2014, to the extent necessary to prevent any of the 2017 Notes from being treated as applicable high yield discount obligations within the meaning of Section 163(i)(1) of the Internal Revenue Code. In addition, the Company may be required to make an offer to purchase the 2017 Notes in certain circumstances described in the 2017 Notes Indenture, including in connection with a change in control.
The obligations under the 2017 Notes are secured by a first priority (subject to permitted liens described in the 2017 Notes Indenture) mortgage or deed of trust lien on certain real property owned by the Company as more fully described in the 2017 Notes Indenture, certain material after-acquired real property of the Company and its Restricted Subsidiaries (as defined in the 2017 Notes Indenture), and a security interest in substantially all of the personal property of the Company and its Restricted Subsidiaries other than receivables, inventory and certain deposit accounts, securities accounts, letters of credit, letter of credit obligations, commercial tort claims, investment property, documents and general intangibles, in which the 2017 Notes will be secured by a second priority security interest (subject to permitted liens described in the 2017 Notes Indenture).
The 2017 Notes Indenture contains covenants, which include limitations on restricted payments, limitations on dividend and other payment restrictions affecting Restricted Subsidiaries, limitations on the incurrence of debt, limitations on asset sales, limitations on transactions with affiliates, limitations on liens, limitations on sale and leaseback transactions and limitations on merger and consolidation.
The 2017 Notes Indenture contains customary events of default, including: (1) the Companys failure to pay principal (or premium, if any, on) any 2017 Note when due at maturity; (2) the Companys failure to pay any interest on any 2017 Note for 30 days after the interest becomes due; (3) the Companys failure to comply with its obligations under the merger and consolidation covenant; (4) any guarantee of 2017 Notes of any significant subsidiary (or any group of Restricted Subsidiaries that, taken together, would constitute a significant subsidiary), being held in judicial proceedings to be unenforceable or invalid or be asserted by any guarantor or the Company, for 30 days, not to be in full force and effect; (5) the Companys failure to comply with its financial information covenant for 120 days after written notice thereof; (6) the Companys failure to perform, or its breach of, any other covenant in the Indenture for 60 days after written notice thereof; (7) nonpayment at maturity or other default (beyond any applicable grace period) under any agreement or instrument relating to any other indebtedness of the Company or a Restricted Subsidiary, the unpaid principal amount of which is not less than $25 million, which default results in the acceleration of the maturity of such indebtedness; (8) the Company or any significant subsidiarys (or any group of Restricted Subsidiaries that, taken together, would constitute a significant subsidiarys) failure to pay final judgments aggregating in excess of $25 million which are not paid, discharged, waived, stayed, bonded or satisfied for a period of 60 days; (9) specified events of bankruptcy, insolvency or reorganization involving the Companys or a significant subsidiary (or any group of Restricted Subsidiaries that, taken together, would constitute a significant subsidiary); and (10) any default or repudiation by the Company or subsidiary guarantor that is a significant subsidiary (or group of subsidiary guarantors that would constitute a significant subsidiary), or a judicial determination, that adversely affects in any material respect the liens in favor of holders of the 2017 Notes on the collateral securing the 2017 Notes, which is not cured within 60 days after the written notice thereof.
If an event of default resulting from specified events involving the Companys or a significant subsidiarys bankruptcy, insolvency or reorganization has occurred and is continuing, the 2017 Notes Indenture provides that the accreted value of, premium, if any, and accrued interest on the 2017 Notes will become immediately due and payable without any declaration or other act on the part of the Trustee or any holder. If any other event of default occurs and is continuing, the 2017 Notes Indenture provides that either the Trustee or the holders of at least 25% in principal amount of the 2017 Notes may declare the accreted value of all the 2017 Notes to be due and payable immediately.
The foregoing description is qualified in its entirety by reference to the 2017 Notes Indenture, which is filed as Exhibit 4.2 to this Current Report on Form 8-K and incorporated herein by reference.