Blackberry 2016 Annual Report Download - page 46

Table of Contents
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Indebtedness (as defined below) of the Company, other than the Specified Senior Indebtedness (as defined below) of the
Company and the Guarantors. No payments shall be made on account of the Debentures during any default of payment when
due of any principal, interest or other amount owing with respect to Specified Senior Indebtedness, unless such Specified
Senior Indebtedness shall first have been paid in full or provided for. The Trustee, on behalf of the holders of Debentures (the
“Holders”), may from time to time enter into subordination agreements with Senior Creditors (as defined below) to reflect the
relative priorities of the Holders and such Senior Creditors.
Conversion Privilege
Each Holder shall have the right at its option to convert each $1,000 principal amount of its Debentures into common shares at
any time prior to the third business day prior to the Maturity Date. Common shares will be issued based on a conversion price
of $10.00 principal amount of Debentures per share (the “Conversion Price”), subject to adjustment in certain circumstances.
Redemption Right
The Debentures will not be redeemable prior to November 13, 2016. On or after November 13, 2016, but prior to
November 13, 2017, the Debentures will be redeemable at the Company’s sole option, on not more than 60 days’ and not less
than 40 days’ prior written notice, in whole or in part, at a price equal to 104% of the principal amount thereof, plus accrued
and unpaid interest. The percentage of principal amount at which the Debentures may be redeemed will decrease by 1% for
each successive one year period thereafter to the Maturity Date.
Change of Control
If a change of control of the Company occurs involving: (i) the acquisition by any person or groups of persons acting jointly or
in concert, directly or indirectly, in a single transaction or a series of related transactions, of voting control or direction over
more than 35% of the then-outstanding common shares; (ii) the acquisition by any person (other than the Company or any of
the Guarantors) or one or more members of a group of persons acting jointly or in concert (other than a group consisting solely
of two or more of the Company and any of the Guarantors), directly or indirectly, in a single transaction or a series of related
transactions, of all or substantially all of the assets of the Company and its subsidiaries, taken as a whole; or (iii) the completion
of a merger, amalgamation, arrangement or similar transaction which results in holders of the Company’s common shares
immediately prior to the completion of the transaction holding less than 50% of the then outstanding common shares of the
resulting entity after the completion of the transaction (a “Change of Control”), the Company is required to make an offer (a
“Repayment Offer”) to purchase all or, at the option of the Holders, a portion (in integral multiples of $1,000) of the principal
amount of the Debentures held by such Holders, at a price equal to 115% of the principal amount thereof plus accrued and
unpaid interest, if any, to but excluding the Change of Control Repurchase Date (as defined in the Indenture) (the “Change of
Control Repurchase Price”). The Company is not required to make that Repayment Offer to Fairfax or its affiliates, or any of
their joint actors, if they caused such a Change of Control. Any Debentures so repurchased will be cancelled and may not be
reissued or resold.
Certain Covenants
The Company is bound by certain covenants under the Indenture. Positive covenants include: (i) payment of the Trustee’s
remuneration; (ii) maintenance of corporate existence and books of account; and (iii) payment of principal, premium (if any)
and interest on the Debentures when due and payable. Reporting covenants include: (i) provision of an annual compliance
certificate regarding compliance with the terms of the Indenture and confirming that no Events of Default have occurred under
the Indenture; (ii) provision of notice of an Event of Default or any event which, with the passing of time or giving of notice,
would constitute an Event of Default; and (iii) provision of public disclosure documents to the Trustee or Holders in certain
circumstances. Subject to customary exceptions, negative covenants include: (i) no liens on assets of the Company or its
subsidiaries, except Permitted Liens (as defined in the Indenture, which include customary liens arising by operation of law,
liens securing Specified Senior Indebtedness, Purchase Money Security Interests (as defined below) securing permitted
Indebtedness, liens on real property incurred in connection with a sale and leaseback of permitted Indebtedness, and any other
lien not prohibited by the Company’s asset-backed lending facility (now terminated), subject to compliance with restrictions on
incurring Indebtedness); (ii) a limitation on amalgamations and mergers except in compliance with customary successor entity
provisions; and (iii) a limitation on dividends, dividend increases and speculative hedging transactions.
The Company and its subsidiaries are restricted, without consent of Holders of 66-2/3% of the outstanding Debentures, from
incurring any indebtedness or permitting any indebtedness to be outstanding, other than:
(a) the Debentures and the Guarantees;
(b) Specified Senior Indebtedness in an aggregate principal amount at any one time outstanding not to exceed
$550,000,000;
(c) Indebtedness in an aggregate principal amount at any one time outstanding not to exceed $450,000,000,
comprised of: