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EXHIBIT 4.1
AMERICAN RESTAURANT GROUP, INC.
as obligor
and the Guarantors referred to herein
$158,600,000
11 1/2% Senior Secured Notes due 2003
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INDENTURE
Dated as of February 25, 1998
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U.S. Trust Company of California, N.A.
Trustee
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INDENTURE, dated as of February 25, 1998, among American Restaurant
Group, Inc., a Delaware corporation (the "Company"), the Guarantors named herein
and U.S. Trust Company of California, N.A., as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Company's 11
1/2% Senior Secured Notes due 2003:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.1. Definitions.
"Acquired Debt" means Indebtedness of a Person existing at the time
such Person is merged with or into the Company or a Restricted Subsidiary or
becomes a Restricted Subsidiary, other than Indebtedness incurred in connection
with, or in contemplation of, such Person merging with or into the Company or a
Restricted Subsidiary or becoming a Restricted Subsidiary; provided, that
Indebtedness of such other Person that is redeemed, defeased, retired or
otherwise repaid at the time, or immediately upon consummation of the
transaction by which such other Person is merged with or into the Company or a
Restricted Subsidiary or becomes a Restricted Subsidiary shall not be Acquired
Debt.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
(i) the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; (ii) in the case of a
corporation, beneficial ownership of 10% or more of any class of Capital Stock
of such Person; and (iii) in the case of an individual (A) members of such
Person's immediate family (as defined in Instruction 2 of Item 404(a) of
Regulation S-K under the Securities Act) and (B) trusts, any trustee or
beneficiaries of which are such Person or members of such Person's immediate
family. Notwithstanding the foregoing, neither the Initial Purchaser nor any of
its Affiliates will be deemed to be Affiliates of the Company.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Asset Sale" means any sale, lease, transfer or other disposition
(or series of related sales, leases, transfers or dispositions) of shares of
Capital Stock or a Restricted Subsidiary (other than directors' qualifying
shares), property or other assets, including by way of a sale/leaseback
transaction (each referred to for the purposes of this definition as a
"disposition"), by the Company or any of its Restricted Subsidiaries (including
any disposition by means of merger, consolidation or similar transaction) other
than (i) a disposition by a
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Restricted Subsidiary to the Company or by the company or a Restricted
Subsidiary to a Wholly Owned Subsidiary, (ii) a disposition of property or
assets in the ordinary course of business, (iii) dispositions of inventory in
the ordinary course of business, (iv) for purposes of the "Limitation on Asset
Sales" covenant only, a disposition that constitutes a Restricted Payment
permitted by Section 4.7 hereof, (v) the sale, lease, transfer or other
disposition of all or substantially all the assets of the Company as permitted
under Section 5.1 hereof, (vi) the grant of Liens permitted by Section 4.12
hereof and (vii) sales of obsolete or worn- out equipment.
"Bankruptcy Law" means title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Board of Directors" means the board of directors or any duly
constituted committee of any corporation or of a corporate general partner of a
partnership and any similar body empowered to direct the affairs of any other
entity.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, as to any Person, the obligations
of such Person under a lease that are required to be classified and accounted
for as capital lease obligations under GAAP, and the amount of such obligations
at any date shall be the capitalized amount of such obligations at such date,
determined in accordance with GAAP.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock, and (ii) with respect to
any other Person, any and all partnership or other equity interests of such
Person.
"Cash Collection Account Agreement" means the Agency Account
Agreement dated as of February 25, 1998 between ▇▇▇▇▇ Fargo Bank and the
Collateral Agent.
"Cash Equivalents" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit and commercial paper issued by the parent corporation of
any domestic commercial bank of recognized standing having capital and surplus
in excess of $250,000,000 and commercial paper issued by others rated at least
A-1 or the equivalent thereof by Standard & Poor's Corporation or at least P-1
or the equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc. and in each case
maturing within one year after the date of acquisition and (iii) investments in
money market funds substantially all of whose assets comprise securities of the
types described in clauses (i) and (ii) above.
"Change of Control" means (i) the transfer (in one transaction or a
series of transactions) of all or substantially all of the Company's assets to
any Person or group (as such term is used in Section 13(d)(3) of the Exchange
Act) other than to one or more Existing Holders, (ii) the liquidation or
dissolution of the Company or the adoption of a plan
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by the stockholders of the Company relating to the dissolution or liquidation of
the Company, (iii) the acquisition by any Person or group (as such term is used
in Section 13(d)(3) of the Exchange Act), except for one or more Existing
Holders, of beneficial ownership, directly or indirectly, of more than 50% of
the aggregate ordinary voting power of the total outstanding Voting Stock of the
Company, or (iv) during any period of two consecutive years, Continuing
Directors cease for any reason to constitute a majority (excluding the Preferred
Directors, if any) of the Board of Directors of the Company then still in
office.
"Closing Date" means the date upon which the Series A Notes are
first issued.
"Collateral" means any assets of the Company or any of its
Subsidiaries defined as "Collateral" in any of the Security Documents and assets
from time to time in which a Lien exists as security for any of the Obligations.
"Collateral Agent" shall mean the Secured Party as defined in the
Security Agreement.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the TIA, then the body performing
such duties at such time.
"Company" means the party named as such above, until a successor
replaces such Person in accordance with the terms of this Indenture, and
thereafter means such successor.
"Company Security Agreement" means the Company Security Agreement,
dated as of the date hereof, by and between the Company and the Collateral
Agent, as amended or supplemented from time to time.
"Company Order" means a written request or order signed in the name
of the Company by its Chairman of the Board, President or Senior Vice President,
and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary and delivered to the Trustee.
"Consolidated EBITDA" means, with respect to any Person (the
referent Person) for any period, consolidated operating profit of such Person
and its subsidiaries for such period, determined in accordance with GAAP, plus
(to the extent such amounts are deducted in calculating such operating profit
(loss) of such Person for such period, and without duplication) amortization,
depreciation and other non-cash charges (including, without limitation, non-cash
impairment charges, amortization of goodwill, deferred financing fees and other
intangibles but excluding non-cash charges incurred after the date of this
Indenture that require an accrual of or a reserve for cash charges for any
future period); provided, that the income from operations of any Person that is
not a Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included only to the extent of the amount of
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dividends or distributions paid during such period to the referent Person or a
Wholly Owned Subsidiary of the referent Person.
"Consolidated Interest Expense" means, with respect to any Person
for any period, the sum of (i) the consolidated interest expense (net of
interest income) of such Person and its subsidiaries for such period, whether
paid or accrued (including amortization of original issue discount, noncash
interest payments and the interest component of Capital Lease Obligations but
excluding amortization of deferred financing costs), to the extent such expense
was deducted in computing Consolidated Net Income of such Person for such
period, and (ii) dividend requirements of such Person and its consolidated
subsidiaries (whether in cash or otherwise (except dividends payable solely in
shares of Qualified Capital Stock)) with respect to preferred stock paid,
accrued, or scheduled to be paid or accrued during such period, in each case to
the extent attributable to such period and excluding items eliminated in
consolidation. For purposes of clause (ii) above, dividend requirements shall be
increased to an amount representing; the pre-tax earnings that would be required
to cover such dividend requirements; accordingly, the increased amount shall be
equal to a fraction, the numerator or which is such dividend requirements and
the denominator of which is 1 minus the applicable actual combined effective
federal, state, local, and foreign income tax rate of such Person and its
subsidiaries (expressed as a decimal), on a consolidated basis, for the fiscal
year immediately preceding the date of the transaction giving rise to the need
to calculate Consolidated Interest Expense.
"Consolidated Net Income" means, with respect to any Person (the
referent Person) for any period, the aggregate of the Net Income of such Person
and its subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP; provided, that (i) the Net Income of any Person that is
not a Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included in calculating the referent Person's Consolidated
Net Income only to the extent of the amount of dividends or distributions paid
during such period to the referent Person or a Wholly Owned Subsidiary of the
referent Person, (ii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition will
be excluded, and (iii) the Net Income of any Subsidiary will be excluded to the
extent that declarations of dividends or similar distributions by that
Subsidiary of such Net Income are not at the time permitted, directly or
indirectly, by operation of the terms of its organization documents or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary or its owners.
"Consolidated Net Worth" means, with respect to any Person, the
total stockholders' equity of such Person determined on a consolidated basis in
accordance with GAAP, adjusted to exclude (to the extent included in calculating
such equity), (i) the amount of any such stockholders' equity attributable to
Disqualified Capital Stock of such Person and its consolidated subsidiaries, and
(ii) all upward revaluations and other write-ups in the book value of any asset
of such person or a consolidated subsidiary of such person subsequent to the
Closing Date, and (iii) all Investments in persons that are not consolidated
Restricted Subsidiaries.
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"Continuing Directors" means (i) individuals who at the beginning of
such period were directors of the Company; (ii) any TCW Director and (iii) any
director whose election by the Board of Directors of the Company or whose
nomination for election by the stockholders of the Company was approved by a
majority of the Continuing Directors then still in office.
"Corporate Trust Office" shall be at the address of the Trustee
specified in Section 11.2 or such other address as the Trustee may specify by
notice to the Company.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or the passage of
time or both would be, an Event of Default.
"Definitive Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A, that do not include the footnotes thereto.
"Depository" means the Person specified in Section 2.3 hereof as the
Depository with respect to the Notes issuable in global form, until a successor
shall have been appointed and become such pursuant to the applicable provision
of this Indenture, and, thereafter, "Depository" shall mean or include such
successor.
"Disqualified Stock" means any Equity Interest that either by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable) is or upon the happening of an event would be required to be
redeemed or repurchased 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.
"DTC" means The Depository Trust Company.
"Equity Interests" means Capital Stock or warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means the offer that may be made by the Company
pursuant to the Registration Rights Agreement to exchange Series B Notes for
Series A Notes.
"Existing Holders" shall mean the holders of the Common Stock of the
Company on the Issue Date, TCW or any of their affiliates.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting
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Standards Board or in such other statements by such other entity as approved by
a significant segment of the accounting profession, and in the rules and
regulations of the Commission, that are in effect on the date of this Indenture.
"Global Note" means a Note that contains the paragraph referred to
in footnote 1 and the additional schedule referred to in footnote 2 in the form
of the Note attached hereto as Exhibit A.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"Guarantors" means all direct or indirect current and future
Restricted Subsidiaries, other than Black Angus Enterprises of Idaho, Inc.
("Idaho, Inc.") until the Company or any of its Subsidiaries makes an Investment
in Idaho, Inc.
"Holder" means a Person in whose name a Note is registered.
"Holdings" means American Restaurant Group Holdings, Inc., a
Delaware corporation.
"Indebtedness" of any Person means (without duplication) (1) all
liabilities and obligations, contingent or otherwise, of such Person (i) in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of such Person or only to a portion thereof), (ii) evidenced
by bonds, debentures, notes or other similar instruments, (iii) representing the
deferred purchase price of property or services (other than liabilities incurred
in the ordinary course of business which are not more than 90 days past due),
(iv) created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though 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), (v) as lessee
under capitalized leases, (vi) under bankers' acceptance and letter of credit
facilities, (vii) to purchase, redeem, retire, defease or otherwise acquire for
value any Disqualified Stock, or (viii) in respect of Hedging Obligations, (2)
all liabilities and obligations of others of the type described in clause (1),
above, that are Guaranteed by such Person, and (3) all liabilities and
obligations of others of the type described in clause (1), above, that are
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such Person;
provided, that the amount of such Indebtedness shall (to the extent such Person
has not assumed or become liable for the payment of such Indebtedness in full)
be the lesser of (x) the fair market value of such property at the time of
determination and (y) the amount of such Indebtedness. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at such
date of all unconditional obligations as described above and the maximum
liability, upon the occurrence of the contingency giving rise to the obligation,
of any contingent obligations at such date.
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"Indenture" means this Indenture as amended or supplemented from
time to time.
"Initial Purchaser" means ▇▇▇▇▇▇▇▇▇ & Company, Inc.
"Intercreditor Agreement" means the intercreditor agreement among
BankBoston, N.A., as agent to the lenders under the New Credit Facility, the
Trustee, the Collateral Agent and certain other parties thereto, dated the
Closing Date.
"Interest Coverage Ratio" means, for any period, the ratio of (i)
Consolidated EBITDA of the Company for such period, to (ii) Consolidated
Interest Expense of the Company for such period. In calculating the Interest
Coverage Ratio for any period, pro forma effect shall be given to: (a) the
incurrence, assumption, guarantee, repayment, repurchase, redemption or
retirement by the Company or any of its Subsidiaries of any Indebtedness
subsequent to the commencement of the period for which the Interest Coverage
Ratio is being calculated but on or prior to the date on which the event for
which the calculation is being made, as if the same had occurred at the
beginning of the applicable period; and (b) the occurrence of any Asset Sale
during such period by reducing Consolidated EBITDA for such period by an amount
equal to the Consolidated EBITDA (if positive) directly attributable to the
assets sold and by reducing Consolidated Interest Expense by an amount equal to
the Consolidated Interest Expense directly attributable to any Indebtedness
assumed by third parties or repaid with the proceeds of such Asset Sale, in each
case as if the same had occurred at the beginning of the applicable period. For
purposes of making the computation referred to above, acquisitions that have
been made by the Company or any of its Restricted Subsidiaries subsequent to the
commencement of such period but on or prior to the date on which the event for
which the calculation is being made shall be given effect on a pro forma basis,
assuming that all such acquisitions had occurred on the first day of such period
in a manner consistent with the calculations described in "Unaudited Selected
Consolidated Pro Forma Condensed Financial Data" contained in the Offering
Circular. Without limiting the foregoing, the financial information of the
Company with respect to any portion of such four fiscal quarters that falls
before the Closing Date shall be adjusted to give pro forma effect to the
issuance of the Notes and the application of the proceeds therefrom as if they
had occurred at the beginning of such four fiscal quarters.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of loans,
Guarantees, advances or capital contributions (excluding (i) commission, travel
and similar advances to officers and employees of such Person made in the
ordinary course of business and (ii) bona fide accounts receivable arising from
the sale of goods or services in the ordinary course of business consistent with
past practice), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, and any other items that are
or would be classified as investments on a balance sheet prepared in accordance
with GAAP.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed.
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"Lien" means any mortgage, lien, pledge, charge, security interest
or encumbrance of any kind, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof, any option or other
agreement to sell or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction).
"Liquidated Damages" has the meaning set out in the Registration
Rights Agreement.
"Material Subsidiary" means any Subsidiary (a) that is a
"Significant Subsidiary" of the Company as defined in Rule 1-02 of Regulation
S-X promulgated by the Commission or (b) is otherwise material to the business
of the Company.
"Mortgages" means those certain first priority mortgages and deeds
of trust, each with assignments of leases and rents and including fixture
filings, dated the Closing Date, made by the Company and its Subsidiaries in
favor of the Collateral Agent.
"Net Income" means, with respect to any Person for any period, the
net income (loss) of such Person for such period, determined in accordance with
GAAP, excluding any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with any Asset Sales
and dispositions pursuant to sale and leaseback transactions, and excluding any
extraordinary gain (but not loss), together with any related provision for taxes
on such gain (but not loss).
"Net Proceeds" means the aggregate proceeds received in the form of
cash or Cash Equivalents in respect of any Asset Sale (including payments in
respect of deferred payment obligations when received), net of (i) the
reasonable and customary direct out-of-pocket costs relating to such Asset Sale
(including, without limitation, legal, accounting and investment banking fees
and sales commissions), other than any such costs payable to an Affiliate of the
Company, (ii) taxes actually payable directly as a result of such Asset Sale
(after taking into account any available tax credits or deductions and any tax
sharing arrangements), (iii) amounts required to be applied to the permanent
repayment of Indebtedness in connection with such Asset Sale, and (iv)
appropriate amounts provided as a reserve by the Company or any Restricted
Subsidiary, in accordance with GAAP, against any liabilities associated with
such Asset Sale and retained by the Company or such 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
arising from such Asset Sale.
"New Credit Facility means the New Credit Facility, entered into on
the Closing Date between the Company, certain of its Subsidiaries, the lenders
named therein and the agent for such Lenders as the same may be amended,
modified, renewed, refunded, replaced or refinanced from time to time, including
(i) any related notes, letters of credit, guarantees, collateral documents,
instruments and agreements executed in connection therewith, and in each case as
amended, modified, renewed, refunded, replaced or refinanced
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from time to time; and (ii) any notes, guarantees, collateral documents,
instruments and agreements executed in connection with such amendment,
modification, renewal, refunding, replacement or refinancing in an aggregate
amount not to exceed $20 million.
"Notes" means, collectively, the Series A Notes and the Series B
Notes.
"Obligations" means any principal, interest, premium, penalties,
fees, indemnifications, reimbursements, damages and other obligations and
liabilities of the Company or any of the Guarantors under this Indenture, the
Security Documents, the Notes or the Guarantees of the Notes.
Offering Circular" means the Company's Offering Circular dated
February 17, 1998.
"Officers" means the Chairman of the Board, the President, the Chief
Financial Officer, Chief Operating Officer, the Treasurer, any Assistant
Treasurer, Controller, Secretary, any Assistant Secretary or any Senior Vice
President of the Company.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the President, Chief
Financial Officer, Treasurer, Controller or a Senior Vice President of the
Company.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee. Such counsel may be an employee of or
counsel to the Company, any Subsidiary of the Company or the Trustee.
"Permitted Affiliate Transactions" means (i) employment agreements,
stockholder agreements, stock options or other incentive plans existing on the
Closing Date or thereafter entered into by the Company or any Restricted
Subsidiary in the ordinary course of business with the approval of a majority of
the disinterested members of the Company's Board of Directors; (ii) transactions
between or among the Company and/or its Restricted Subsidiaries; or (iii)
reasonable and customary fees and compensation paid to and indemnity provided on
behalf of, officers, directors, employees or consultants of the Company or any
Restricted Subsidiary as determined in good faith by a majority of the
disinterested directors of the Company's Board of Directors.
"Permitted Investments" means (i) Investments in the Company, any
Guarantor or any Restricted Subsidiary (including without limitation, Guarantees
of Indebtedness of any such Person), (ii) Investments in Cash Equivalents, (iii)
Investments in a Person, if as a result of such Investment (a) such Person
becomes a Restricted Subsidiary or (b) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Restricted Subsidiary, (iv)
Hedging Obligations, (v) Investments in securities of trade creditors or
customers received pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of such trade creditors or customers, (vi)
Investments as a result of consideration received in connection with an Asset
Sale made in compliance with Section 4.10 of this Indenture, (vii)
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Investments existing on the Closing Date, (viii) accounts receivable owing to
the Company or any Restricted Subsidiary, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms, (ix) payroll, travel and similar advances in the ordinary course of
business, (x) loans or advances to employees made in the ordinary course of
business; and (xi) Guarantees permitted to be made pursuant to Section 4.9.
"Permitted Liens" means (i) Liens in favor of the Company and/or its
Restricted Subsidiaries other than with respect to intercompany Indebtedness,
(ii) Liens on property of a Person existing at the time such Person is acquired
by, merged into or consolidated with the Company or any Restricted Subsidiary,
provided, that such Liens were not created in contemplation of such acquisition
and do not extend to assets other than those subject to such Liens immediately
prior to such acquisition, (iii) Liens on property existing at the time of
acquisition thereof by the Company or any Restricted Subsidiary, provided, that
such Liens were not created in contemplation of such acquisition and do not
extend to assets other than those subject to such Liens immediately prior to
such acquisition, (iv) Liens incurred in the ordinary course of business in
respect of Hedging Obligations, (v) Liens incurred in the ordinary course of
business to secure the performance of statutory obligations, surety or appeal
bonds, performance bonds or other obligations (exclusive of obligations
constituting Indebtedness) of a like nature including, without limitation, cash
retainages, (vi) Liens existing or created on the date of this Indenture, (vii)
Liens for taxes, assessments or governmental charges or claims that are not yet
delinquent or that are being contested or remedied in good faith by appropriate
proceedings promptly instituted and diligently concluded, provided, that any
reserve or other appropriate provision as may be required in conformity with
GAAP has been made therefor, (viii) Liens arising by reason of any judgment,
decree or order of any court with respect to which the Company or any of its
Restricted Subsidiaries is then in good faith prosecuting an appeal or other
proceedings for review, the existence of which judgment, order or decree is not
an Event of Default under this Indenture, (ix) encumbrances consisting of zoning
restrictions, survey exceptions, utility easements, licenses, rights of way,
easements of ingress or egress over property of the Company or any of its
Restricted Subsidiaries, rights or restrictions of record on the use of real
property, minor defects in title, landlord's and lessor's liens under leases on
property located on the premises rented, mechanics' liens, warehouseman's liens,
supplier's liens, repairman's liens, vendors' liens, contractor's liens and
similar encumbrances, rights or restrictions on personal or real property, in
each case not interfering in any material respect with the ordinary conduct of
the business of the Company or any of its Restricted Subsidiaries, (x) Liens
incidental to the conduct of business or the ownership of properties incurred in
the ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, bids, and government contracts and leases and subleases,
(xi) Liens for any interest or title of a lessor under any Capitalized Lease
Obligation permitted to be incurred under this Indenture; provided, that such
Liens do not extend to any property or asset that is not leased property subject
to such Capitalized Lease Obligation, (xii) any extension, renewal, or
replacement (or successive extensions, renewals or replacements), in whole or in
part, of Liens described in clauses (i) through (xi) above, (xiii) Liens
securing the Notes, and (xiv)
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Liens in addition to the foregoing, which in the aggregate, are secured by
assets with a fair market value not in excess of $100,000 at any time.
"Permitted Tax Payments to Holdings" means payments made to Holdings
to enable Holdings to pay foreign, Federal, state, and local tax liabilities
imposed directly upon Holdings ("Tax Payments"); provided, however, that (i)
notwithstanding the foregoing, in the case of any Tax Payment that is permitted
to be made to Holdings in respect of its Federal income tax liability for any
taxable period during which Holdings is the parent company of an affiliated
group that includes the Company and each of its United States subsidiaries as
members and files a consolidated Federal income tax return, such payment shall
be determined on the basis of assuming that the Company is the parent company of
an affiliated group (the "Company Affiliated Group") filing a consolidated
Federal income tax return and that Holdings and each such United States
subsidiary is a member of the Company Affiliated Group and (ii) any Tax Payment
made to Holdings shall either be used by Holdings to pay such tax liabilities to
the applicable taxing authority within 10 days of Holdings' receipt of such
payment or refunded to the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof, or any other entity.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and between the Company and its Subsidiaries, on the one hand and the
Collateral Agent, on the other, as amended or supplemented from time to time.
"Preferred Directors" means the two members of the Company's Board
of Directors that the holders of a majority of the Preferred Stock, voting as
one class, may be entitled from time to time to elect pursuant to the terms of
the Preferred Stock upon the Company's failure to discharge certain obligations
thereunder, or breach of certain provisions thereof or failure to satisfy
certain tests therein.
"Preferred Stock Repurchases" means any purchase of Preferred Stock
with the portion of Excess Proceeds remaining after payment of the purchase
price of the Notes tendered pursuant to an Excess Proceeds Offer if such
purchase of Preferred Stock is within 485 days of the date of the Asset Sale
which gave rise to such Excess Proceeds Offer.
"Purchase Money Liens" means Liens to secure or securing Purchase
Money Obligations permitted to be incurred under this Indenture.
"QIB" shall mean "qualified institutional buyer" as defined in Rule
144A.
"Qualified Capital Stock" means, with respect to any Person, Capital
Stock of such Person other than Disqualified Capital Stock.
"Qualified Equity Offering" means (i) an underwritten primary public
offering of Qualified Capital Stock of the Company pursuant to an effective
registration statement
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under the Securities Act or (ii) a private offering of Qualified Capital Stock
other than issuances of common stock pursuant to employee benefit plans or as
compensation to employees.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Date, by and among the Company, the
Guarantors and the Initial Purchaser as such agreement may be amended, modified
or supplemented from time to time.
"Responsible Officer" when used with respect to the Trustee, means
any officer within the corporate trust department of the Trustee located at the
Corporate Trust Office (or any successor group of the Trustee) or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the designated officers, and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Investment" means any Investment other than a Permitted
Investment.
"Restricted Securities" means Notes that bear or are required to
bear the legends set forth in Exhibit A hereto.
"Restricted Subsidiary" means a Subsidiary other than an
Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule
may be amended from time to time, or under any similar rule or regulation
hereafter adopted by the Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreements" means the Company Security Agreement and
Subsidiary Security Agreement.
"Security Documents" means, collectively, the Mortgages, the
Security Agreements, the Pledge Agreement, the Cash Collection Account
Agreement, the Intercreditor Agreement, the Trademark Security Agreement and any
other document, instrument or agreement executed or delivered by the Company or
any of its Subsidiaries from time to time pursuant to which the Company or any
such Subsidiary shall ▇▇▇▇▇ ▇ ▇▇▇▇ on any of their respective properties, assets
or revenues to secure payment of the Obligations hereunder and under the Notes
or relating to intercreditor matters.
"Series A Notes" means the Company's 11 1/2% Series A Senior Secured
Notes due 2003, as authenticated and issued under this Indenture.
"Series B Notes" means the Company's 11 1/2% Series B Senior Secured
Notes due 2003, as authenticated and issued under this Indenture.
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"subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Voting Stock thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other subsidiaries
of that Person or a combination thereof and (ii) any partnership in which such
Person or any of its subsidiaries is a general partner.
"Subsidiary" means any subsidiary of the Company.
"Subsidiary Security Agreement" means the Subsidiary Security
Agreement, dated as of the date hereof, by and between the Restricted
Subsidiaries and the Collateral Agent, as amended or supplemented from time to
time.
"TCW " means TCW Asset Management Company, TCW Shared Opportunities
Fund II, TCW Leveraged Income Trust L.P.or any of their affiliates.
"TCW Directors" means members of the Board of Directors nominated by
TCW or any of their affiliates pursuant to the Stockholders Agreement (as
defined herein).
"TCW Tax Payments" means the payments made to TCW pursuant to
Section 4.2 of the Securityholders Agreement dated as of February 25, 1998 among
Holdings, the Company, TCW and the other parties thereto, which payments shall
not exceed $125,000 per year.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss. ss.
77aaa-77bbbb), as amended, as in effect on the date hereof until such time as
this Indenture is qualified under the TIA, and thereafter as in effect on the
date on which this Indenture is qualified under the TIA.
"Trademark Security Agreement" means the Trademark Collateral
Security Agreement, dated as of the Closing Date, between the Company and the
Restricted Subsidiaries, on the one hand, and the Collateral Agent on the other,
as amended or supplemented from time to time.
"transfer" means any direct or indirect sale, assignment, transfer,
lease, conveyance, or other disposition (or series of related sales, leases,
transfers or dispositions) (including, without limitation, by way of merger or
consolidation).
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Unrestricted Subsidiary" means any Subsidiary that has been
designated by the Company (by written notice to the Trustee as provided below)
as an Unrestricted Subsidiary; provided, that a Subsidiary may not be designated
as an "Unrestricted Subsidiary" unless (i) such Subsidiary does not own any
Capital Stock of, or own or hold any Lien on any property of, the Company or any
Restricted Subsidiary (other than such Subsidiary), (ii)
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neither immediately prior thereto nor after giving pro forma effect to such
designation, would there exist a Default or Event of Default, (iii) immediately
after giving effect to such designation on a pro forma basis, the Company could
incur at least $1.00 of Indebtedness pursuant to Section 4.9(a) of this
Indenture and (iv) the creditors of such Subsidiary have no direct or indirect
recourse (including, without limitation, recourse with respect to the payment of
principal or interest on Indebtedness of such Subsidiary) to the assets of the
Company or of a Restricted Subsidiary (other than such Subsidiary). The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary only if (a) no Default or Event of Default is existing or
will occur as a consequence thereof and (b) immediately after giving effect to
such designation, on a pro forma basis, the Company could incur at least $1.00
of Indebtedness pursuant to Section 4.9(a) of this Indenture. Each such
designation shall be evidenced by filing with the Trustee a certified copy of
the Board Resolution giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
conditions. The Company shall be deemed to make an Investment in each Subsidiary
designated as an "Unrestricted Subsidiary" immediately following such
designation in an amount equal to the Investment in such Subsidiary and its
subsidiaries immediately prior to such designation; provided, that if such
Subsidiary is subsequently redesignated as a Restricted Subsidiary, the amount
of such Investment shall be deemed to be reduced (but not below zero) by the
fair market value of the net consolidated assets of such Subsidiary on the date
of such redesignation.
"U.S. Government Obligations" means direct obligations of the United
States of America, or any agency or instrumentality thereof for the payment of
which the full faith and credit of the United States of America is pledged.
"Voting Stock" means, with respect to any Person, (i) one or more
classes of the Capital Stock of such Person having general voting power to elect
at least a majority of the board of directors, managers or trustees of such
Person (irrespective of whether or not at the time Capital Stock of any other
class or classes have or might have voting power by reason of the happening of
any contingency), (ii) any Capital Stock of such Person convertible or
exchangeable without restriction at the option of the holder thereof into
Capital Stock of such Person described in clause (i) above and (iii) the
Warrants.
"Warrants" means the warrants to purchase shares of the Company's
common stock, $0.01 par value per share, issued pursuant to the Warrant
Agreement dated February 25, 1998 between the Company and U.S. Trust of
California, N.A., as Warrant Agent.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years (rounded to the nearest
one-twelfth) obtained by dividing (i) the then outstanding principal amount of
such Indebtedness into (ii) the total of the products obtained by multiplying
(x) the amount of each then remaining installment, sinking fund, serial maturity
or other required payments of principal, including payment at final maturity, in
respect thereof, by (y) the number of years (calculated to the nearest
one-twelfth) that will elapse between such date and the making of such payment.
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"Wholly Owned Subsidiary" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares) is owned by the
Company or one or more Wholly Owned Subsidiaries.
Section 1.2. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction".................... 4.11
"Change of Control Offer".................. 4.14
"Change of Control Payment"................ 4.14
"Change of Control Payment Date"........... 4.14
"Definitive Notes"......................... 2.1
"Event of Default"......................... 6.1
"Excess Proceeds".......................... 4.10
"Excess Proceeds Offer".................... 4.10
"Excess Proceeds Offer Period"............. 4.10
"Excess Proceeds Payment Date"............. 4.10
"Global Note".............................. 2.1
"Guaranty"................................. 10.7
"Hedging Obligations"...................... 4.9(b)
"Paying Agent"............................. 2.3
"Purchase Amount".......................... 4.10
"Purchase Money Indebtedness".............. 4.9(b)
"Refinance"................................ 4.9(b)
"Refinancing Indebtedness"................. 4.9(b)
"Registrar"................................ 2.3
"Restricted Payments"...................... 4.7
Section 1.3. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
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"obligor" on the Notes means the Company, the Guarantors and any successor
obligor upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule under
the TIA have the meanings so assigned to them.
Section 1.4. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural include
the singular; and
(5) provisions apply to successive events and transactions.
ARTICLE 2
THE NOTES
Section 2.1. Form and Dating.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A attached hereto, the terms of which are
incorporated in and made a part of this Indenture. Each Note shall include the
Guaranty executed by each of the Guarantors in the form of Exhibit C attached
hereto, the terms of which are incorporated and made a part of this Indenture.
The Notes may have notations, legends or endorsements required by law, stock
exchange rule, agreements to which the Company is subject or usage. Each Note
shall be dated the date of its authentication. The Notes shall be issued in
denominations of $1,000 and integral multiples thereof.
The Notes will be issued (i) in global form (the "Global Note"),
substantially in the form of Exhibit A attached hereto (including the text
referred to in footnotes 1 and 2 thereto) and (ii) in definitive form (the
"Definitive Notes"), substantially in the form of Exhibit A attached hereto
(excluding the text referred to in footnotes 1 and 2 thereto). The Global Note
shall represent the aggregate amount of outstanding Notes from time to time
endorsed thereon; provided, that the aggregate amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of the Global
Note to reflect the amount of any increase
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or decrease in the amount of outstanding Notes represented thereby shall be made
by the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.6 hereof.
Section 2.2. Execution and Authentication.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature. If an Officer whose signature is on a Note no longer holds
that office at the time the Note is authenticated, the Note shall nevertheless
be valid.
A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature of the Trustee shall be conclusive
evidence that the Note has been authenticated under this Indenture. The form of
Trustee's certificate of authentication to be borne by the Notes shall be
substantially as set forth in Exhibit A attached hereto.
The Trustee shall, upon a Company Order, authenticate for original
issue up to $158,600,000 aggregate principal amount of each series of the Notes.
The aggregate principal amount of Notes outstanding at any time may not exceed
$158,600,000 except as provided in Section 2.7 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authenticating by the Trustee includes
authenticating by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate of the Company.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name any Note is registered as the owner of such
Note for the purpose of receiving payment of principal of and (subject to the
provisions of this Indenture and the Notes with respect to record dates)
interest on such Note and for all other purposes whatsoever, whether or not such
Note is overdue, and neither the Company, the Trustee nor any agent of the
Company or the Trustee shall be affected by notice to the contrary.
Except as set forth in the next sentence, the Notes will initially
be issued in the form of one or more registered global Notes which will be
deposited on the Closing Date with, or on behalf of, the Depository and
registered in the name of the global Holder. Notes that are originally issued to
or transferred to an institutional "accredited investor" (within the meaning of
Rule 501 under the Securities Act) who is not a "qualified institutional buyer"
(within the meaning of Rule 144A (a "QIB) or to any other persons who are not
QIBs shall be issued in the form of certificated Notes in registered form
substantially in the form set forth in Exhibit A.
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Section 2.3. Registrar, Paying Agent and Depository.
The Company shall maintain (i) an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and (ii)
an office or agency where Notes may be presented for payment ("Paying Agent").
The Company initially appoints the Trustee as Registrar and Paying Agent. The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co- registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee of the name and address of any Agent not a party to this Indenture.
If the Company fails to appoint or maintain another entity as Registrar or
Paying Agent, the Trustee shall act as such. The Company or any of its
Subsidiaries may act as Paying Agent or Registrar, except that for purposes of
Articles Three and Eight and Sections 4.1, 4.10 and 4.14 neither the Company nor
any of its Subsidiaries shall act as Paying Agent.
The Company shall enter into an appropriate agency agreement with
any Agent not a party to this Indenture, which shall incorporate the provisions
of the TIA. The agreement shall implement the provisions of this Indenture that
relate to such Agent.
The Company initially appoints DTC to act as Depository with respect
to the Global Notes. The Trustee shall act as custodian for the Depository with
respect to the Global Notes.
Section 2.4. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent shall hold in trust for the benefit of
the Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes and shall notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary of the Company) shall
have no further liability for the money delivered to the Trustee. If the Company
or a Subsidiary of the Company acts as Paying Agent (subject to Section 2.3), it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent.
Section 2.5. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before 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 date as the
Trustee may reasonably require of the names and addresses of the Holders,
including the
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aggregate principal amount thereof, and the Company shall otherwise comply with
TIA ss. 312(a).
Section 2.6. Transfer and Exchange.
(a) Transfer and Exchange of Definitive Notes. When Definitive Notes
are presented by a Holder to the Registrar with a request (1) to register the
transfer of the Definitive Notes or (2) to exchange such Definitive Notes for an
equal principal amount of Definitive Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, that the Definitive
Notes so presented (A) have been duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by his attorney, duly authorized in writing; and (B) in the case
of a Restricted Security, such request shall be accompanied by the following
additional documents:
(i) if such Restricted Security is being delivered to the Registrar
by a Holder for registration in the name of such Holder, without transfer,
a certification to that effect (in substantially the form of Exhibit B
attached hereto); or
(ii) if such Restricted Security is being transferred to a QIB in
accordance with Rule 144A or pursuant to an effective registration
statement under the Securities Act, a certification to that effect (in
substantially the form of Exhibit B attached hereto); or
(iii) if such Restricted Security is being transferred in reliance
on another exemption from the registration requirements of the Securities
Act, a certification to that effect (in substantially the form of Exhibit
B attached hereto) and an opinion of counsel reasonably acceptable to the
Company and the Registrar to the effect that such transfer is in
compliance with the Securities Act.
(b) Transfer of a Definitive Note for a Beneficial Interest in a
Global Note. A Definitive Note may be exchanged for a beneficial interest in a
Global Note only upon receipt by the Trustee of a Definitive Note, duly endorsed
or accompanied by appropriate instruments of transfer, in form satisfactory to
the Trustee, together with:
(i) written instructions from the entity surrendering such
Definitive Note directing the Trustee to make an endorsement on the Global
Note to reflect an increase in the aggregate principal amount of the Notes
represented by the Global Note, and
(ii) if such Definitive Note is a Restricted Security, a
certification (in substantially the form of Exhibit B attached hereto) to
the effect that such Definitive Note is being transferred to a QIB in
accordance with Rule 144A;
in which case the Trustee shall cancel such Definitive Note and cause the
aggregate principal amount of Notes represented by the Global Note to be
increased accordingly. If no Global
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Note is then outstanding, the Company shall issue and the Trustee shall
authenticate a new Global Note in the appropriate principal amount.
(c) Transfer and Exchange of Global Notes. The transfer and exchange
of Global Notes or beneficial interests therein shall be effected through the
Depository in accordance with this Indenture and the procedures of the
Depository therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act.
(d) Transfer of a Beneficial Interest in a Global Note for a
Definitive Note. Upon receipt by the Trustee of written transfer instructions
(or such other form of instructions as is customary for the Depository) from the
Depository (or its nominee) on behalf of any Person having a beneficial interest
in a Global Note, the Trustee shall, in accordance with the standing
instructions and procedures existing between the Depository and the Trustee,
cause the aggregate principal amount of Global Notes to be reduced accordingly
and, following such reduction, the Company shall execute and the Trustee shall
authenticate and make available for delivery to the transferee a Definitive Note
in the appropriate principal amount; provided, that in the case of a Restricted
Security, such instructions shall be accompanied by the following additional
documents:
(i) if such beneficial interest is being transferred to the Person
designated by the Depository as being the beneficial owner, a
certification to that effect (in substantially the form of Exhibit B
attached hereto); or
(ii) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A or pursuant to an effective registration
statement under the Securities Act, a certification to that effect (in
substantially the form of Exhibit B attached hereto); or
(iii) if such beneficial interest is being transferred in reliance
on another exemption from the registration requirements of the Securities
Act, a certification to that effect (in substantially the form of Exhibit
B attached hereto) and an opinion of counsel reasonably acceptable to the
Company and to the Registrar to the effect that such transfer is in
compliance with the Securities Act.
Definitive Notes issued in exchange for a beneficial interest in a
Global Note shall be registered in such names and in such authorized
denominations as the Depository shall instruct the Trustee.
(e) Transfer and Exchange of Global Notes. Notwithstanding any other
provision of this Indenture, the Global Note may not be transferred as a whole
except by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee of such
successor Depository; provided, that if:
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(i) the Depository notifies the Company that the Depository is
unwilling or unable to continue as Depository and a successor Depository
is not appointed by the Company within 90 days after delivery of such
notice; or
(ii) the Company, at its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of Definitive Notes under
this Indenture,
then the Company shall execute and the Trustee shall authenticate and make
available for delivery, Definitive Notes in an aggregate principal amount equal
to the aggregate principal amount of the Global Note in exchange for such Global
Note in the names and in such authorized dominations as the Depository shall
direct the Trustee and such Notes shall be made available for delivery to the
Persons designated by the Depository.
(f) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in the Global Note have either been exchanged for
Definitive Notes, redeemed, repurchased or cancelled, the Global Note shall be
returned to or retained and cancelled by the Trustee. At any time prior to such
cancellation, if any beneficial interest in the Global Note is exchanged for
Definitive Notes, redeemed, repurchased or cancelled, the aggregate principal
amount of Notes represented by such Global Note shall be reduced accordingly and
an endorsement shall be made on such Global Note by the Trustee to reflect such
reduction.
(g) General Provisions Relating to Transfers and Exchanges. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Definitive Notes and Global Notes at the
Registrar's request. All Definitive Notes and Global Notes issued upon any
registration of transfer or exchange of Definitive Notes or Global Notes shall
be legal, valid and binding obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Definitive
Notes or Global Notes surrendered upon such registration of transfer or
exchange.
No service charge shall be made to a Holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchange (without transfer to another person) pursuant to Sections
2.10, 3.7, 4.10, 4.14 and 9.5 of this Indenture).
The Company shall not be required to (i) issue, register the
transfer of or exchange Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for redemption under
Section 3.2 hereof and ending at the close of business on the day of selection;
or (ii) 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; or (iii) register the transfer of or exchange a Note between a record date
and the next succeeding interest payment date.
Prior to due presentment for the registration of a transfer of any
Note, the Trustee, any Agent and the Company may deem and treat the Person in
whose name any
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Note is registered as the absolute owner of such Note for all purposes, and
neither the Trustee, any Agent nor the Company shall be affected by notice to
the contrary.
(h) Exchange of Series A Notes for Series B Notes. The Series A
Notes may be exchanged for Series B Notes pursuant to the terms of the Exchange
Offer. The Trustee and Registrar shall make the exchange as follows:
The Company shall present the Trustee with an Officers' Certificate
certifying the following:
(A) upon issuance of the Series B Notes, the transactions
contemplated by the Exchange Offer have been consummated; and
(B) the principal amount of Series A Notes properly tendered in
the Exchange Offer that are represented by a Global Note and
the principal amount of Series A Notes properly tendered in
the Exchange Offer that are represented by Definitive Notes,
the name of each Holder of such Definitive Notes, the
principal amount at maturity properly tendered in the Exchange
Offer by each such Holder and the name and address to which
Definitive Notes for Series B Notes shall be registered and
sent for each such Holder.
The Trustee, upon receipt of (i) such Officers' Certificate, (ii) an
Opinion of Counsel to the effect that the Series B Notes have been registered
under Section 5 of the Securities Act and this Indenture has been qualified
under the TIA and (iii) a Company Order, shall authenticate (A) a Global Note
for Series B Notes in an aggregate principal amount equal to the aggregate
principal amount of Series A Notes represented by a Global Note indicated in
such Officers' Certificate as having been properly tendered and (B) Definitive
Notes representing Series B Notes registered in the names of, and in the
principal amounts indicated in such Officers' Certificate.
If the principal amount of the Global Note for the Series B Notes is
less than the principal amount of the Global Note for the Series A Notes, the
Trustee shall make an endorsement on such Global Note for Series A Notes
indicating a reduction in the principal amount represented thereby.
The Trustee shall deliver such Definitive Notes for Series B Notes
to the Holders thereof as indicated in such Officers' Certificate.
Section 2.7. Replacement Notes.
If any mutilated Note is surrendered to the Trustee, or the Company
and the Trustee receive evidence to their satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee shall authenticate
a replacement Note if the Trustee's requirements for replacements of Notes are
met. If required by the Trustee or the Company, an indemnity bond must be
supplied by the Holder that is sufficient in the judgment of the
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Trustee and the Company to protect the Company, the Trustee, any Agent or any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company or the Trustee may charge for its expenses in replacing a
Note.
Every replacement Note is an obligation of the Company and shall be
entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.8. Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding.
If a Note is replaced pursuant to Section 2.7 hereof, the replaced
Note ceases to be outstanding unless the Trustee receives proof satisfactory to
it that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.1 hereof, it ceases to be outstanding and interest on it ceases to accrue.
Subject to Section 2.9 hereof, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.
Section 2.9. Treasury Notes.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by the
Company or any Affiliate of the Company shall be considered as though not
outstanding, except that for purposes of determining whether the Trustee shall
be protected in relying on any such direction, waiver or consent, only Notes
that a Trustee knows to be so owned shall be considered as not outstanding.
Section 2.10. Temporary Notes.
Pending the preparation of definitive Notes, the Company (and the
Guarantors) may execute, and upon Company Order the Trustee shall authenticate
and make available for delivery, temporary Notes that are printed, lithographed,
typewritten, mimeographed or otherwise reproduced, in any authorized
denomination, substantially of the tenor of the definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as conclusively evidenced by their execution of such Notes.
If temporary Notes are issued, the Company (and the Guarantors)
shall cause definitive Notes to be prepared without unreasonable delay. The
definitive Notes shall be
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printed, lithographed or engraved, or provided by any combination thereof, or in
any other manner permitted by the rules and regulations of any principal
national securities exchange, if any, on which the Notes are listed, all as
determined by the Officers executing such definitive Notes. After the
preparation of definitive Notes, the temporary Notes shall be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
maintained by the Company for such purpose pursuant to Section 4.2 hereof,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes, the Company (and the Guarantors) shall execute, and the Trustee
shall authenticate and make available for delivery, in exchange therefor the
same aggregate principal amount of definitive Notes of authorized denominations.
Until so exchanged, the temporary Notes shall in all respects be entitled to the
same benefits under this Indenture as definitive Notes.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall retain or
destroy cancelled Notes in accordance with its normal practices (subject to the
record retention requirement of the Exchange Act) unless the Company directs
them to be returned to it. The Company may not issue new Notes to replace Notes
that have been redeemed or paid or that have been delivered to the Trustee for
cancellation. All cancelled Notes held by the Trustee shall be returned to the
Company.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, which date shall be at the earliest
practicable date but in all events at least five Business Days prior to the
payment date, in each case at the rate provided in the Notes and in Section 4.1
hereof. The Company shall, with the consent of the Trustee, fix or cause to be
fixed each such special record date and payment date. At least 15 days before
the special record date, the Company (or the Trustee, in the name of and at the
expense of the Company) shall mail to the Holders a notice that states the
special record date, the related payment date and the amount of such interest to
be paid.
Section 2.13. Legends.
(a) Except as permitted by subsections (b) or (c) hereof, each Note
shall bear legends relating to restrictions on transfer pursuant to the
securities laws in substantially the form set forth on Exhibit A attached
hereto.
(b) Upon any sale or transfer of a Restricted Security (including
any Restricted Security represented by a Global Note) pursuant to Rule 144 under
the Securities Act or pursuant to an effective registration statement under the
Securities Act:
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(i) in the case of any Restricted Security that is a Definitive
Note, the Registrar shall permit the Holder thereof to exchange such
Restricted Security for a Definitive Note that does not bear the legends
required by subsection (a) above; and
(ii) in the case of any Restricted Security represented by a Global
Note, such Restricted Security shall not be required to bear the legends
required by subsection (a) above, but shall continue to be subject to the
provisions of Section 2.6(c) hereof; provided, that with respect to any
request for an exchange of a Restricted Security that is represented by a
Global Note for a Definitive Note that does not bear the legends required
by subsection (a) above, which request is made in reliance upon Rule 144,
the Holder thereof shall certify in writing to the Registrar that such
request is being made pursuant to Rule 144.
(c) The Company (and the Guarantors) shall issue and the Trustee
shall authenticate Series B Notes in exchange for Series A Notes accepted for
exchange in the Exchange Offer. The Series B Notes shall not bear the legends
required by subsection (a) above unless the Holder of such Series A Notes is
either (A) a broker-dealer who purchased such Series A Notes directly from the
Company to resell pursuant to Rule 144A or any other available exemption under
the Securities Act, (B) a Person participating in the distribution of the Series
A Notes or (C) a Person who is an affiliate (as defined in Rule 144A) of the
Company.
ARTICLE 3
REDEMPTION
Section 3.1. Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.7 hereof, it shall furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of Section 3.7 pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
Section 3.2. Selection of Notes to Be Redeemed.
If less than all the Notes are to be redeemed, the Trustee shall
select the Notes to be redeemed in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed,
or, if the Notes are not so listed, pro rata, by lot or by such method as the
Trustee deems to be fair and reasonable.
The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
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Section 3.3. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail a notice of redemption by first class mail to each Holder
whose Notes are to be redeemed at such Holder's registered address.
The notice shall identify the Notes to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part only, the portion of
the principal amount of such Note to be redeemed and that, after the
redemption date, upon cancellation of the original Note, a new Note or
Notes in principal amount equal to the unredeemed portion shall be issued;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such
redemption payment, interest on Notes or portions of Notes called for
redemption ceases to accrue on and after the redemption date;
(7) the paragraph of the Notes and/or the section of this
Indenture pursuant to which the Notes called for redemption are being
redeemed; and
(8) the CUSIP number of the Notes to be redeemed.
At the Company's request, the Trustee shall give the notice of
redemption in the name of the Company and at its expense; provided that the
Company shall deliver to the Trustee, at least 45 days (unless a shorter period
is acceptable to the Trustee) prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice and setting forth the
information to be stated in such notice as provided in the preceding paragraph.
Section 3.4. Effect of Notice of Redemption.
Once notice of redemption has been mailed to the Holders in
accordance with Section 3.3 herein, Notes called for redemption become due and
payable on the redemption date at the redemption price. At any time prior to the
mailing of a notice of redemption to the Holders pursuant to Section 3.3, the
Company may withdraw, revoke or rescind any notice of redemption delivered to
the Trustee without any continuing obligation to redeem the Notes as
contemplated by such notice of redemption.
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Section 3.5. Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the
Trustee (to the extent not already held by the Trustee) or with the Paying Agent
money in immediately available funds sufficient to pay the redemption price of
and accrued interest on all Notes to be redeemed on that date. The Trustee or
the Paying Agent shall return to the Company any money deposited with the
Trustee or the Paying Agent by the Company in excess of the amounts necessary to
pay the redemption price of, and accrued interest on, all Notes to be redeemed.
Interest on the Notes to be redeemed shall cease to accrue on the
applicable redemption date, whether or not such Notes are presented for payment,
if the Company makes or deposits the redemption payment in accordance with this
Section 3.5. If any Note called for redemption shall not be paid upon surrender
for redemption because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption date until such principal is paid, and to the extent lawful on any
interest not paid on such unpaid principal, in each case at the rate provided in
the Notes.
Section 3.6. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder at the expense of the
Company a new Note equal in principal amount to the unredeemed portion of the
Note surrendered.
Section 3.7. Optional Redemption.
(a) Except as set forth in Section 3.7(b), the Notes are not
redeemable at the Company's option prior to February 15, 2001. Thereafter, the
Notes will be subject to redemption at the option of the Company, in whole or in
part, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest thereon, if any, to the
applicable redemption date, if redeemed during the 12-month period beginning on
February 15 of the years indicated below:
Year Percentage
---- ----------
2001 . . . . . . . . . . . . . . .105.75%
2002 and thereafter . . . . . . . 100%
(b) Notwithstanding the foregoing, at any time or from time to time
prior to February 15, 2000, the Company may, at its option, redeem up to
one-third of the original principal amount of the Notes, at a redemption price
of 111.5% of the principal amount thereof, plus accrued and unpaid interest, if
any, to the applicable redemption date, with the net cash proceeds of one or
more Qualified Equity Offerings; provided, that (i) such redemption shall occur
within 60 days of the date of closing of such public offering and (ii) at least
two-thirds of the original aggregate principal amount of Notes remains
outstanding immediately after giving effect to each such redemption.
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ARTICLE 4
COVENANTS
Section 4.1. Payment of Notes.
The Company shall pay the principal and premium, if any, of, and
interest on, the Notes on the dates and in the manner provided in the Notes.
Principal, premium, if any, and interest shall be considered paid on the date
due if the Paying Agent, other than the Company or a Subsidiary of the Company,
holds on or before that date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal, premium,
if any, and interest then due. Such Paying Agent shall return to the Company, no
later than three Business Days following the date of payment, any money that
exceeds such amount of principal, premium, if any, and interest then due and
payable on the Notes. The Company shall pay any and all amounts, including
without limitation Liquidated Damages, if any, on the dates and in the manner
required under the Registration Rights Agreement.
The Company shall pay interest (including post-petition interest) on
overdue installments of interest (without regard to any applicable grace period)
at the same rate to the extent lawful.
Section 4.2. Maintenance of Office or Agency.
The Company shall maintain an office or agency (which may be an
office of the Trustee, Registrar or co-registrar) in the Borough of Manhattan,
The City of New York where Notes may be surrendered for registration of transfer
or exchange and where notices and demands to or upon the Company in respect of
the Notes and this Indenture may be served. The Company shall give prompt
written notice to the Trustee of the location, and any change in the location,
of such office or agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.3.
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Section 4.3. Reports.
(a) The Company shall file with the Trustee, within 15 days after
the time of filing with the Commission, copies of the reports, information and
other documents (or copies of such portions of any of the foregoing as the
Commission may by rules and regulations prescribe) that the Company is required
to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act.
If the Company is not subject to the requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall file with the Commission and the Trustee all
such reports, information and other documents as it would be required to file if
it were subject to the requirements of Section 13 or 15(d) of the Exchange Act;
provided, that the Company shall not be in default of the provisions of this
Section 4.3 for any failure to file reports with the Commission solely by
refusal by the Commission to accept the same for filing. The Company shall
deliver (or cause the Trustee to deliver) copies of all reports, information and
documents required to be filed with the Trustee pursuant to this Section 4.3 to
the Holders at their addresses appearing in the register of Notes maintained by
the Registrar. The Company shall also comply with the provisions of TIA ss.
314(a).
(b) If the Company is required to furnish annual, quarterly or
current reports to its stockholders pursuant to the Exchange Act, the Company
shall cause any annual, quarterly, current or other financial report furnished
by it generally to its stockholders to be filed with the Trustee mailed to the
Holders at their addresses appearing in the register of Notes maintained by the
Registrar. If the Company is not required to furnish annual, quarterly or
current reports to its stockholders pursuant to the Exchange Act, then, to the
extent not already filed with the Trustee or provided to the Holders pursuant to
paragraph (a) above, the Company shall cause the financial statements of the
Company and its consolidated Subsidiaries (and similar financial statements for
all unconsolidated Subsidiaries, if any), including any notes thereto (and, with
respect to annual reports, an auditors' report by an accounting firm of
established national reputation), and a "Management's Discussion and Analysis of
Financial Condition and Results of Operations," comparable to that which would
have been required to appear in annual or quarterly reports filed under Section
13 or 15(d) of the Exchange Act to be so filed with the Trustee and mailed to
the Holders promptly, but in any event, within 90 days after the end of each of
the fiscal years of the Company and within 45 days after the end of each of the
first three quarters of each such fiscal year.
(c) So long as is required for an offer or sale of the Notes to
qualify for an exemption under Rule 144A, the Company (and the Guarantors)
shall, upon request, provide the information required by clause (d)(4)
thereunder to each Holder and to each beneficial owner and prospective purchaser
of Notes identified by any Holder of Restricted Securities.
Section 4.4. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year, an Officers' Certificate (provided, that one of the
signatories to such Officers' Certificate shall be the Company's principal
executive officer, principal financial officer or principal accounting officer)
stating that a review of the activities of the Company and its Subsidiaries
during the preceding fiscal year has been made under the supervision of
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the signing Officers with a view to determine whether each has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that each of the
Company and its Subsidiaries has kept, observed, performed and fulfilled each
and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions hereof
or thereof (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he may have knowledge and what
action each is taking or proposes to take with respect thereto).
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.3 above shall be accompanied by a
written statement of the independent public accountants of the Company (which
shall be a firm of established national reputation reasonably satisfactory to
the Trustee) that in making the examination necessary for certification of such
financial statements nothing has come to their attention which would lead them
to believe that either the Company or any of its Subsidiaries has violated any
provisions of this Indenture or, if any such violation has occurred, specifying
the nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) So long as any of the Notes are outstanding, the Company shall
deliver to the Trustee forthwith upon any Officer becoming aware of (i) any
Default or Event of Default or (ii) any event of default under any mortgage,
indenture or instrument referred to in Section 6.1(5) hereof, an Officers'
Certificate specifying such Default, Event of Default or other event of default
and what action the Company is taking or proposes to take with respect thereto.
Section 4.5. Taxes.
The Company shall, and shall cause its Subsidiaries to, file all tax
returns required to be filed and to pay prior to delinquency all material taxes,
assessments and governmental levies except as contested in good faith and by
appropriate proceedings and for which reserves have been established in
accordance with GAAP.
Section 4.6. Stay, Extension and Usury Laws.
The Company (and each Guarantor) covenants (to the extent that it
may lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company and
each Guarantor hereby expressly (to the extent that it may lawfully do so)
waives all benefit or advantage of any such law and covenants that it shall not,
by resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee but shall suffer and permit the execution of every
such power as though no such law has been enacted.
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Section 4.7. Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly:
(i) declare or pay any dividend or make any distribution on
account of any Equity Interests of the Company or any of its Restricted
Subsidiaries (other than (x) dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company or (y) dividends
or distributions payable to the Company or any Restricted Subsidiary or
(z) if the Subsidiary making such dividend or distribution is not a Wholly
Owned Subsidiary, dividends to its shareholders on a pro-rata basis),
(ii) purchase, redeem or otherwise acquire or retire for value
any Equity Interest of the Company, any Subsidiary or any other Affiliate
of the Company (other than any such Equity Interest owned by the Company
or any Wholly Owned Subsidiary),
(iii) make any principal payment on, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness of the
Company or any Guarantor that is subordinated in right of payment to the
Notes or such Guarantor's Guarantee thereof, as the case may be,
(iv) make any Restricted Investment, or
(v) make any payment or transfer any assets to, or on behalf
of, Holdings or any of its Affiliates
(all such payments and other actions set forth in clauses (i) through (v)
above being collectively referred to as "Restricted Payments") unless, at
the time of such Restricted Payment:
(1) no Default or Event of Default has occurred and is
continuing or would occur as a consequence thereof,
(2) immediately after giving effect thereto on a pro forma
basis, the Company could incur at least $1.00 of additional Indebtedness
under Section 4.9(a) hereof, and
(3) such Restricted Payment (the value of any such payment, if
other than cash, being determined in good faith by the Board of Directors
and evidenced by a resolution set forth in an Officers' Certificate
delivered to the Trustee), together with the aggregate of all other
Restricted Payments made after the date of this Indenture (including
Restricted Payments permitted by clauses (i), (v) (to the extent made in
cash) and (vi) of Section 4.7(b) and excluding Restricted Payments
permitted by the other clauses therein), is less than the sum of (x) 50%
of the Consolidated Net Income of the Company for the period (taken as one
accounting period) from the beginning of
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the first quarter commencing immediately after the Closing Date to the end
of the Company's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted Payment
(or, if such Consolidated Net Income for such period is a deficit, 100% of
such deficit), plus (y) 100% of the aggregate net cash proceeds (or of the
net cash proceeds received upon the conversion of non-cash proceeds into
cash) received by the Company from the issuance or sale, other than to a
Subsidiary, of Equity Interests of the Company (other than Disqualified
Stock) after the date of this Indenture and on or prior to the time of
such Restricted Payment, plus (z) 100% of the aggregate net cash proceeds
(or of the net cash proceeds received upon the conversion of non-cash
proceeds into cash) received by the Company from the issuance or sale,
other than to a Subsidiary, of any convertible or exchangeable debt
security of the Company that has been converted or exchanged into Equity
Interests of the Company (other than Disqualified Stock) pursuant to the
terms thereof after the date of this Indenture and on or prior to the time
of such Restricted Payment (including any additional net cash proceeds not
included in clause (y) above received by the Company upon such conversion
or exchange). The aggregate amount of each Investment constituting a
Restricted Payment since the date hereof shall be reduced by the aggregate
after-tax amount of all payments made to the Company and its Restricted
Subsidiaries with respect to such Investments; provided, that (a) the
maximum amount of such payments shall not exceed the original amount of
such Investment and (b) such payments shall also be excluded from the
calculations contemplated by clauses (3)(x) through (z) of this Section
4.7.
(b) The provisions of subsection (a) above shall not prohibit:
(i) the payment of any dividend within 60 days after the date
of declaration thereof, if at said date of declaration such payment would
not have been prohibited by the provisions of this Indenture,
(ii) the redemption, purchase, retirement or other acquisition
of any Equity Interests of the Company or Indebtedness of the Company or
any Restricted Subsidiary solely in exchange for Equity Interests of the
Company (other than Disqualified Stock),
(iii) the redemption, repurchase or payoff of any Indebtedness
with proceeds of any Refinancing Indebtedness permitted to be incurred
pursuant to the provisions of Section 4.9(b)(x) hereof,
(iv) payments by the Company to Holdings in respect of
Permitted Tax Payments to Holdings,
(v) the redemption of the Preferred Stock with the proceeds
of a Qualified Equity Offering,
(vi) Permitted Affiliate Transactions, or
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(vii) Preferred Stock Repurchases,
(viii) the TCW Tax Payments,
(ix) payments of dividends on Disqualified Stock issued in
accordance with Section 4.9(a) hereof, or
(x) other Restricted Payments in an aggregate amount not to
exceed $2.0 million.
(c) Not later than the date of making each Restricted Payment (other
than Restricted Payments contemplated by Section 4.7(b)), the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment is permitted, and setting forth the basis upon which the calculations
required by this Section 4.7 were computed, which calculations may be based upon
the Company's latest available financial statements.
Section 4.8. Limitation on Restrictions on Subsidiary Dividends.
The Company 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 encumbrance or restriction on the ability of any
Restricted Subsidiary
(a) to (1) pay dividends or make any other distributions to the
Company or any of its Restricted Subsidiaries (A) on such Restricted
Subsidiary's Capital Stock or (B) with respect to any other interest or
participation in, or measured by, such Restricted Subsidiary's profits or (2)
pay any indebtedness owed to the Company or any of its Restricted Subsidiaries,
or
(b) to make loans or advances to the Company or any of its
Restricted Subsidiaries, or
(c) to transfer any of its assets to the Company or any of its
Restricted Subsidiaries, except for such encumbrances or restrictions existing
under or by reason of:
(i) the New Credit Facility, as in effect on the Closing Date,
or any refinancings, amendments, modifications or supplements thereof
containing dividend or other payment restrictions that are not materially
more restrictive than those contained in the New Credit Facility on the
Closing Date,
(ii) this Indenture, the Security Documents and the Notes,
(iii) applicable law,
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(iv) restrictions with respect to a Subsidiary that was not a
Subsidiary on the Closing Date in existence at the time such Person
becomes a Subsidiary (but not created as a result of or in anticipation of
such Person becoming a Subsidiary); provided, that such restrictions are
not applicable to any other Person or the properties or assets of any
other Person,
(v) customary non-assignment and net worth provisions of any
contract or lease entered into in the ordinary course of business,
(vi) customary restrictions on the transfer of assets subject
to a Lien permitted under this Indenture imposed by the holder of such
Lien,
(vii) restrictions imposed by any agreement to sell assets or
Capital Stock to any Person pending the closing of such sale, and
(viii) permitted Refinancing Indebtedness (including
Indebtedness Refinancing Acquired Debt), provided, that such restrictions
contained in any agreement governing such Refinancing Indebtedness are not
materially more restrictive than those contained in any agreements
governing the Indebtedness being Refinanced.
Section 4.9. Limitation on Incurrence of Indebtedness.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, (1) create, incur, issue,
assume, guaranty or otherwise become directly or indirectly liable with respect
to, contingently or otherwise (collectively, "incur"), any Indebtedness
(including Acquired Debt) or (2) issue any Disqualified Stock; provided, that
the Company may incur Indebtedness (including Acquired Debt) or issue shares of
Disqualified Stock and any Restricted Subsidiary may incur Acquired Debt, in
each case if (x) no Default or Event of Default shall have occurred and be
continuing at the time of, or would occur after giving effect on a pro forma
basis to such incurrence or issuance, and (y) the Interest Coverage Ratio for
the Company's most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock is issued would
have been at least equal to 2:1, determined on a pro forma basis (including a
pro forma application of the net proceeds therefrom), as if the additional
Indebtedness (including Acquired Debt) had been incurred, or the Disqualified
Stock had been issued, as the case may be, at the beginning of such four-quarter
period.
(b) The limitations of Section 4.9(a) shall not prohibit the
incurrence of:
(i) Indebtedness under the New Credit Facility, provided, that
the aggregate principal amount of Indebtedness so incurred on any date,
together with all other Indebtedness incurred pursuant to this clause (i)
and outstanding on such date, shall not exceed $20 million,
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(ii) performance bonds, appeal bonds, surety bonds, insurance
obligations or bonds and other similar bonds or obligations incurred in
the ordinary course of business,
(iii) obligations incurred to fix the interest rate on any
variable rate Indebtedness otherwise permitted by this Indenture ("Hedging
Obligations"),
(iv) Indebtedness owed by (1) a Restricted Subsidiary to the
Company or to a Wholly Owned Subsidiary or (2) the Company to a Wholly
Owned Subsidiary,
(v) Indebtedness outstanding on the date of this Indenture,
including the Notes and the Guarantees,
(vi) Indebtedness arising from 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
Indebtedness is extinguished within three Business Days of incurrence,
(vii) Indebtedness represented by Guarantees by the Company of
Indebtedness otherwise permitted to be incurred pursuant to this covenant
and Indebtedness represented by Guarantees by a Restricted Subsidiary of
Indebtedness of the Company or another Restricted Subsidiary otherwise
permitted to be Incurred pursuant to this covenant;
(viii) obligations with respect to customary provisions
regarding post-closing purchase price adjustments and indemnification in
agreements for the purchase or sale of a business or assets otherwise
permitted by the Indenture;
(ix) other Indebtedness in an aggregate principal amount at
any one time outstanding not to exceed $5.0 million; and
(x) Indebtedness issued in exchange for, or the proceeds of
which are contemporaneously used to extend, refinance, renew, replace, or
refund (collectively, "Refinance") Indebtedness referred to in clause (v)
above or this clause (x) or Indebtedness incurred pursuant to the Interest
Coverage Ratio test set forth in Section 4.9(a) hereof ("Refinancing
Indebtedness"); provided, that (A) the principal amount of such
Refinancing Indebtedness does not exceed the principal amount of
Indebtedness so Refinanced (plus the premiums required to be paid, and the
out-of-pocket expenses (other than those payable to an Affiliate of the
Company) reasonably incurred, in connection therewith), (B) the
Refinancing Indebtedness has a final scheduled maturity that exceeds the
final stated maturity, and a Weighted Average Life to Maturity that is
equal to or greater than the Weighted Average Life to Maturity of the
Indebtedness being Refinanced, and (C) the Refinancing Indebtedness ranks,
in right of payment, no more favorable to the Notes as the Indebtedness
being Refinanced.
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Section 4.10. Limitation on Asset Sales.
The Company shall not, and shall not permit any Restricted
Subsidiary to, make any Asset Sale unless (i) the Company or such Restricted
Subsidiary receives consideration at the time of such Asset Sale at least equal
to the fair market value (as determined in good faith by the Board of Directors
as evidenced by a resolution of the Board of Directors set forth in an Officers'
Certificate delivered to the Trustee) of the assets subject to such Asset Sale,
(ii) at least 75% of the consideration for such Asset Sale is in the form of
cash, Cash Equivalents or liabilities of the Company or any Restricted
Subsidiary (other than liabilities that are by their terms subordinated to the
Notes or any Guarantee of the Notes) that are assumed by the transferee of such
assets (provided, that following such Asset Sale there is no further recourse to
the Company and its Restricted Subsidiaries with respect to such liabilities),
and (iii) within 12 months of such Asset Sale, the Net Proceeds thereof are (a)
invested in assets related to the business of the Company or its Restricted
Subsidiaries, or (b) used to repay, purchase or otherwise acquire Indebtedness
under the New Credit Facility or (c) to the extent not used as provided in
clause (a) or (b), applied to make an offer to purchase Notes as described below
(an "Excess Proceeds Offer"); provided, that if the amount of Net Proceeds from
any Asset Sale not invested or used pursuant to clause (a) or (b) above is less
than $5.0 million, the Company shall not be required to make an offer pursuant
to clause (c) until the aggregate amount of Excess Proceeds from all Asset Sales
exceeds $5.0 million. Pending the final application of any such Net Proceeds,
the Company or any Restricted Subsidiary may temporarily reduce Indebtedness
under the New Credit Facility or temporarily invest such Net Proceeds in Cash
Equivalents.
For the purposes of this covenant, the following are deemed to be
cash: (y) securities received by the Company or any Restricted Subsidiary from
the transferee that are promptly converted by the Company or such Restricted
Subsidiary into cash and (z) assets related to the business of the Company or
its Restricted Subsidiaries received in an exchange of assets transaction;
provided that (i) in the event such exchange of assets transaction or series of
related exchange of assets transactions (each an "Exchange Transaction")
involves an aggregate value in excess of $2.5 million, the terms of such
Exchange Transaction shall have been approved by a majority of the disinterested
members of the Board of Directors, (ii) in the event such Exchange Transaction
involves an aggregate value in excess of $5.0 million, the Company shall have
received a written opinion from a nationally recognized independent investment
banking firm that the Company has received consideration equal to the fair
market value of the assets disposed of and (iii) any assets to be received shall
be comparable to those being exchanged as determined in good faith by the Board
of Directors.
The amount of Net Proceeds not invested, used or applied as set
forth in the preceding clauses (a) and (b) constitutes "Excess Proceeds." If the
Company elects, or becomes obligated to make an Excess Proceeds Offer, the
Company shall offer to purchase Notes having an aggregate principal amount equal
to the Excess Proceeds (the "Purchase Amount"), at a purchase price equal to
100% of the aggregate principal amount thereof, plus accrued and unpaid
interest, if any, to the purchase date. The Company must commence such Excess
Proceeds Offer not later than 30 days after the expiration of the 12-month
period following the Asset Sale that produced Excess Proceeds. If the aggregate
purchase price for
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the Notes tendered pursuant to the Excess Proceeds Offer is less than the Excess
Proceeds, the Company and its Restricted Subsidiaries may use the portion of the
Excess Proceeds remaining after payment of such purchase price for general
corporate purposes, including Preferred Stock Purchases.
Each Excess Proceeds Offer shall remain open for a period of 20
Business Days and no longer, unless a longer period is required by law (the
"Excess Proceeds Offer Period"). Promptly after the termination of the Excess
Proceeds Offer Period (the "Excess Proceeds Payment Date"), the Company shall
purchase and mail or deliver payment for the Purchase Amount for the Notes or
portions thereof tendered, pro rata or by such other method as may be required
by law, or, if less than the Purchase Amount has been tendered, all Notes
tendered pursuant to the Excess Proceeds Offer. The principal amount of Notes to
be purchased pursuant to an Excess Proceeds Offer may be reduced by the
principal amount of Notes acquired by the Company through purchase or redemption
(other than pursuant to a Change of Control Offer) subsequent to the date of the
Asset Sale and surrendered to the Trustee for cancellation.
Each Excess Proceeds Offer shall be conducted in compliance with all
applicable laws, including without limitation, Regulation 14E of the Exchange
Act and the rules thereunder and all other applicable Federal and state
securities laws. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of this Section 4.10, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.10 by virtue
thereof.
The Company shall, no later than 30 days following the expiration of
the 12-month period following the Asset Sale that produced Excess Proceeds,
commence the Excess Proceeds Offer, if an Excess Proceeds Offer is required by
the terms of this Indenture, by mailing to the Trustee and each Holder, at such
Holder's last registered address, a notice, which shall govern the terms of the
Excess Proceeds Offer, and shall state:
(1) that the Excess Proceeds Offer is being made pursuant to
this Section 4.10, the principal amount of Notes which shall be accepted
for payment and that all Notes validly tendered shall be accepted for
payment on a pro rata basis;
(2) the purchase price and the date of purchase;
(3) that any Notes not tendered or accepted for payment
pursuant to the Excess Proceeds Offer shall continue to accrue interest;
(4) that, unless the Company defaults in the payment of the
purchase price with respect to any Notes tendered, Notes accepted for
payment pursuant to the Excess Proceeds Offer shall cease to accrue
interest after the Excess Proceeds Payment Date;
(5) that Holders electing to have Notes purchased pursuant to
an Excess Proceeds Offer shall be required to surrender their Notes, with
the form
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entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, to the Company prior to the close of business on the third
Business Day immediately preceding the Excess Proceeds Payment Date;
(6) that Holders shall be entitled to withdraw their election
if the Company receives, not later than the close of business on the
second Business Day preceding the Excess Proceeds Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the name
of the Holder, the principal amount of Notes the Holder delivered for
purchase and a statement that such Holder is withdrawing his election to
have such Notes purchased;
(7) that if the aggregate purchase price of the Notes tendered
pursuant to the Excess Proceeds Offer is less than the Excess Proceeds,
the Company may use the portion of the Excess Proceeds remaining after
payment of such purchase price for general corporate purposes, including
Preferred Stock Purchases.
(8) that Holders whose Notes are purchased only in part shall
be issued Notes representing the unpurchased portion of the Notes
surrendered; provided that each Note purchased and each new Note issued
shall be in principal amount of $1,000 or whole multiples thereof; and
(9) the instructions that Holders must follow in order to
tender their Notes.
On or before the Excess Proceeds Payment Date, the Company shall (i)
accept for payment on a pro rata basis the Notes or portions thereof tendered
pursuant to the Excess Proceeds Offer, (ii) deposit with the Paying Agent money
sufficient to pay the purchase price of all Notes or portions thereof so
accepted and (iii) deliver to the Trustee the Notes so accepted, together with
an Officers' Certificate stating that the Notes or portions thereof tendered to
the Company are accepted for payment. The Paying Agent shall promptly mail to
each Holder of Notes so accepted payment in an amount equal to the purchase
price of such Notes, and the Trustee shall promptly authenticate and mail to
such Holders new Notes equal in principal amount to any unpurchased portion of
the Note surrendered.
The Company shall make a public announcement of the results of the
Excess Proceeds Offer as soon as practicable after the Excess Proceeds Payment
Date. For the purposes of this Section 4.10, the Trustee shall act as the Paying
Agent.
Section 4.11. Limitation on Transactions With Affiliates.
The Company shall not, and shall not permit any of the Restricted
Subsidiaries to, directly or indirectly, sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into any contract, agreement, understanding, loan, advance
or guarantee with, or for the benefit of, any Affiliate (each of the foregoing,
an "Affiliate Transaction"), except for (i) Affiliate Transactions, which
together with all Affiliate Transactions that are part of a common plan, have an
aggregate value of not
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more than $1.0 million; provided, that such transactions are conducted in good
faith and on terms that are no less favorable to the Company or the relevant
Restricted Subsidiary than those that would have been obtained in a comparable
transaction at such time on an arm's- length basis from a Person that is not an
Affiliate of the Company or such Restricted Subsidiary, (ii) Affiliate
Transactions, which together with all Affiliate Transactions that are part of a
common plan, have an aggregate value of not more than $2.5 million; provided,
that a majority of the disinterested members of the Board of Directors of the
Company determine that such transactions are conducted in good faith and on
terms that are no less favorable to the Company or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an Affiliate of
the Company or such Restricted Subsidiary, (iii) Affiliate Transactions for
which the Company delivers to the Trustee an opinion as to the fairness to the
Company or such Restricted Subsidiary from a financial point of view, issued by
an investment banking firm of national standing and (iv) Permitted Affiliate
Transactions and other Restricted Payments permitted by the provisions described
in Section 4.7 hereof.
Section 4.12. Limitation on Liens.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist
any Lien on any asset (including, without limitation, all real, tangible or
intangible property) of the Company or any Restricted Subsidiary, whether now
owned or hereafter acquired, or on any income or profits therefrom, or assign or
convey any right to receive income therefrom, except (i) Liens in favor of the
Collateral Agent securing the Notes and Indebtedness incurred under the New
Credit Facility, (ii) Purchase Money Liens, and (iii) Permitted Liens.
Section 4.13. Corporate Existence.
Subject to Article 5 of this Indenture, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect (i) its corporate existence, and the corporate, partnership or other
existence of each of its respective Subsidiaries, in accordance with their
respective organizational documents (as the same may be amended from time to
time) and (ii) its (and its Subsidiaries) rights (charter and statutory),
licenses and franchises; provided, that the Company shall not be required to
preserve any such right, license or franchise, or the corporate, partnership or
other existence of any Subsidiary, if the Board of Directors on behalf of the
Company shall determine in good faith that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries
taken as a whole and that the loss thereof is not adverse in any material
respect to the Holders.
Section 4.14. Repurchase Upon a Change of Control.
Upon the occurrence of a Change of Control, the Company shall notify
the Trustee in writing thereof and shall make an offer to purchase all of the
Notes then outstanding as described below (the "Change of Control Offer") at a
purchase price equal to
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101% of the aggregate principal amount thereof plus accrued and unpaid interest,
if any, to the date of repurchase (the "Change of Control Payment").
The Change of Control Offer shall be made in compliance with all
applicable laws, including without limitation, Regulation 14E of the Exchange
Act and the rules thereunder and all other applicable Federal and state
securities laws. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of this Section 4.14, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.14 by virtue
thereof.
Within 30 days following any Change of Control, the Company shall
commence the Change of Control Offer by mailing to the Trustee and each Holder a
notice, which shall govern the terms of the Change of Control Offer, and shall
state that:
(i) the Change of Control Offer is being made pursuant to this
Section 4.14 and that all Notes tendered will be accepted for payment,
(ii) the purchase price and the purchase date, which shall be
a Business Day no earlier than 30 days nor later than 60 days from the
date such notice is mailed (the "Change of Control Payment Date"),
(iii) that any Note not tendered for payment pursuant to the
Change of Control Offer shall continue to accrue interest,
(iv) that, unless the Company defaults in the payment of the
Change of Control Payment, all Notes accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest on the Change of
Control Payment Date,
(v) that any Holder electing to have Notes purchased pursuant
to a Change of Control Offer shall be required to surrender such Notes,
with the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Notes completed, to the Paying Agent at the address specified in
the notice prior to the close of business on the third Business Day
preceding the Change of Control Payment Date,
(vi) that any Holder shall be entitled to withdraw such
election if the Paying Agent receives, not later than the close of
business on the second Business Day preceding the Change of Control
Payment Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of Notes such Holder
delivered for purchase, and a statement that such Holder is withdrawing
his election to have such Notes purchased,
(vii) that a Holder whose Notes are being purchased only in
part shall be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered, which unpurchased portion
must be equal to $1,000 in principal amount or an integral multiple
thereof,
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(viii) the instructions that Holders must follow in order to
tender their Notes, and
(ix) the circumstances and relevant facts regarding such
Change of Control.
On the Change of Control Payment Date, the Company shall, to the
extent lawful, (i) accept for payment the Notes or portions thereof tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions thereof so tendered and not withdrawn, and (iii) deliver or cause to be
delivered to the Trustee the Notes so accepted together with an Officers'
Certificate stating that the Notes or portions thereof tendered to the Company
are accepted for payment. The Paying Agent shall promptly mail to each Holder of
Notes so accepted payment in an amount equal to the purchase price for such
Notes, and the Trustee shall authenticate and mail to each Holder a new Note
equal in principal amount to any unpurchased portion of the Notes surrendered,
if any, provided, that each such new Note will be in principal amount of $1,000
or an integral multiple thereof.
The Company shall make a public announcement of the results of the
Change of Control Offer on or as soon as practicable after the Change of Control
Payment Date. For the purposes of this Section 4.14, the Trustee shall act as
the Paying Agent.
Section 4.15. Maintenance of Properties.
The Company shall, and shall cause each of its Subsidiaries to,
maintain their properties and assets in normal working order and condition as on
the date of this Indenture (reasonable wear and tear excepted) and make all
necessary repairs, renewals, replacements, additions, betterments and
improvements thereto, as shall be reasonably necessary for the proper conduct of
the business of the Company and its Subsidiaries taken as a whole; provided,
that nothing herein shall prevent the Company or any of its Subsidiaries from
discontinuing any maintenance of any such properties if such discontinuance is
desirable in the conduct of the business of the Company and its Subsidiaries
taken as a whole.
Section 4.16. Maintenance of Insurance.
The Company shall, and shall cause each of its Subsidiaries to,
maintain liability, casualty and other insurance (including self-insurance
consistent with prior practice) with responsible insurance companies in such
amounts and against such risks as is in accordance with customary industry
practice in the general areas in which the Company and its Subsidiaries operate.
Section 4.17. Restrictions on Sale and Issuance of Subsidiary Stock.
The Company shall not sell, and shall not permit any of its
Restricted Subsidiaries to issue or sell, any shares of Capital Stock of any
Restricted Subsidiary (other than directors' qualifying shares) to any Person
other than the Company or a Wholly Owned
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Subsidiary; provided however, that this provision shall not prohibit the sale of
all of the Capital Stock of any Restricted Subsidiary owned by the Company and
its Restricted Subsidiaries if the Net Proceeds from such Asset Sale are used in
accordance with the provisions of Section 4.10 of this Indenture.
Section 4.18. Line of Business.
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any type of business other than the type of business
conducted or proposed to be conducted by the Company and the Restricted
Subsidiaries on the Closing Date and businesses reasonably related thereto.
ARTICLE 5
SUCCESSORS
Section 5.1. When the Company May Merge, etc.
The Company shall not consolidate or merge with or into (whether or
not the Company is the surviving corporation), or transfer all or substantially
all of its properties or assets (determined on a consolidated basis for the
Company and its Restricted Subsidiaries) in one or more related transactions to,
any other Person unless:
(i) the Company is the surviving Person or the Person formed
by or surviving any such consolidation or merger (if other than the
Company) or to which such transfer has been made is a corporation
organized and existing under the laws of the United States, any state
thereof or the District of Columbia,
(ii) the Person formed by or surviving any such consolidation
or merger (if other than the Company) or the Person to which such transfer
has been made assumes all the Obligations of the Company, pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee,
under the Notes, this Indenture, the Security Documents and the
Registration Rights Agreement,
(iii) immediately before and after such transaction, no
Default or Event of Default exists, and
(iv) the Company, or any Person formed by or surviving any
such consolidation or merger, or to which such transfer has been made, (A)
has a Consolidated Net Worth (immediately after the transaction but prior
to any purchase accounting adjustments resulting from the transaction) not
less than 100% of the Consolidated Net Worth of the Company immediately
preceding the transaction and (B) shall be permitted, at the time of such
transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter
period, to incur at least $1.00 of additional Indebtedness pursuant to
Section 4.9(a) hereof.
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The Company shall deliver to the Trustee prior to the consummation
of any proposed transaction an Officers' Certificate to the foregoing effect, an
Opinion of Counsel, stating all conditions precedent to the proposed transaction
provided for in this Indenture have been complied with and a written statement
from a firm of independent public accountants of established national reputation
reasonably satisfactory to the Trustee stating that the proposed transaction
complies with clause (iv).
For purposes of this Section 5.1, the transfer of all or
substantially all of the properties and assets of one or more Restricted
Subsidiaries of the Company, which properties and assets, if held by the Company
instead of such Restricted Subsidiaries, would constitute all or substantially
all of the properties and assets of the Company on a consolidated basis, shall
be deemed to be the transfer of all or substantially all of the properties and
assets of the Company.
Section 5.2. Successor Substituted.
In the event of any transaction (other than a lease) contemplated by
Section 5.1 hereof in which the Company is not the surviving Person, the
successor formed by such consolidation or into or with which the Company is
merged or to which such transfer is made, or formed by such reorganization, as
the case may be, shall succeed to, and be substituted for, and may exercise
every right and power of, the Company, and the Company shall be discharged from
its Obligations under this Indenture, the Notes, the Security Documents and the
Registration Rights Agreement with the same effect as if such successor Person
had been named as the Company herein or therein.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.1. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest on any
Note when the same becomes due and payable and the Default continues for a
period of 30 days;
(2) the Company defaults in the payment of the principal (or
premium, if any) on any Note when the same becomes due and payable at
maturity, upon redemption, by acceleration, in connection with an Excess
Proceeds Offer, a Change of Control Offer or otherwise;
(3) the Company defaults in the performance of or breaches the
provisions of Sections 4.7 or 4.9 hereof and the Default continues for 30
days; or the Company defaults in the performance of or breaches the
provisions of Sections 4.10, 4.14 or Article 5 hereof;
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(4) the Company or any Guarantor fails to comply with any of
its other agreements or covenants in, or provisions of, the Notes or this
Indenture and the Default continues for 30 days after written notice
thereof has been given to the Company by the Trustee or to the Company and
the Trustee by the Holders of at least 25% in aggregate principal amount
of the then outstanding Notes, such notice to state that it is a "Notice
of Default;"
(5) a default occurs under (after giving effect to any
waivers, amendments, applicable grace periods or any extension of any
maturity date) any mortgage, indenture or instrument under which there may
be issued or by which there may be secured or evidenced any Indebtedness
for money borrowed by the Company or any Restricted Subsidiary (or the
payment of which is guaranteed by the Company or any Restricted
Subsidiary), whether such Indebtedness or guarantee now exists or is
created after the date of this Indenture, if (a) either (i) such default
results from the failure to pay principal on such Indebtedness or (ii) as
a result of such default the maturity of such Indebtedness has been
accelerated, and (b) the principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness with respect to
which such a payment default (after the expiration of any applicable grace
period or any extension of the maturity date) has occurred, or the
maturity of which has been so accelerated, exceeds $2.5 million in the
aggregate; provided that if such default results from a failure to pay
principal on the New Credit Facility, such default shall not constitute an
Event of Default hereunder until 15 days after such default;
(6) a final non-appealable judgment or judgments for the
payment of money (other than judgments as to which a reputable insurance
company has accepted full liability) is or are entered by a court or
courts of competent jurisdiction against the Company or any Restricted
Subsidiary and such judgment or judgments remain undischarged, unbonded or
unstayed for a period of 60 days after entry, provided that the aggregate
of all such judgments exceeds $2.5 million;
(7) there is a breach by the Company or any Guarantor of any
provision of the Security Documents and the default continues for 30 days
after written notice thereof has been given to the Company by the Trustee
or to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the then outstanding Notes, such notice to
state that it is a "Notice of Default";
(8) written assertion is made by the Company or any of the
Guarantors, of the unenforceability of their obligations under the
Indenture, the Security Documents, the Notes, or the Guarantees to which
they are a party;
(9) the Company or any Material Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(a) commences a voluntary case,
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(b) consents to the entry of an order for relief
against it in an involuntary case,
(c) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(d) makes a general assignment for the benefit of its
creditors,
(e) admits in writing its inability to pay debts as
the same become due; or
(10) a court of competent jurisdiction enters an order or
decree, and the order or decree remains unstayed and in effect for 60 days
under any Bankruptcy Law that:
(a) is for relief against the Company or any Material
Subsidiary in an involuntary case,
(b) appoints a Custodian of the Company or any
Material Subsidiary or for all or substantially
all of their property,
(c) orders the liquidation of the Company, or any
Material Subsidiary. an
The Company shall, upon becoming aware that a Default or Event of
Default has occurred, deliver to the Trustee a statement specifying such Default
or Event of Default and what action the Company is taking or proposes to take
with respect thereto.
Section 6.2. Acceleration.
If an Event of Default (other than an Event of Default specified in
clauses (9) and (10) of Section 6.1) occurs and is continuing, the Trustee by
written notice to the Company, or the Holders of at least 25% in principal
amount of the then outstanding Notes by written notice to the Company and the
Trustee, may declare the unpaid principal of and any accrued interest on all the
Notes to be due and payable. Upon such declaration the principal and interest
shall be due and payable immediately. If an Event of Default specified in clause
(9) or (10) of Section 6.1 with respect to the Company occurs, all outstanding
Notes shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder. At any time
after a declaration of acceleration, 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 Notes outstanding, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if (a) the Company has paid or deposited with the Trustee a sum
sufficient to pay (i) all sums paid or advanced by the Trustee and the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, (ii) all overdue
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interest (including any interest accrued subsequent to an Event of Default
specified in clauses (9) and (10) of Section 6.1) on all Notes, (iii) the
principal of and premium, if any, on any Notes that have become due otherwise
than by such declaration or occurrence of acceleration and interest thereon at
the rate borne by the Notes, and (iv) to the extent that payment of such
interest is lawful, interest upon overdue interest at the rate borne by the
Notes; (b) all Events of Default, other than the non-payment of principal of and
interest on the Notes that have become due solely by such declaration or
occurrence of acceleration, have been cured or waived; and (c) the rescission
would not conflict with any judgment, order or decree of any court of competent
jurisdiction.
Section 6.3. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy (under this Indenture or otherwise) to collect the
payment of principal or interest on the Notes to enforce the performance of any
provision of the Notes, this Indenture or the Security Documents.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
Section 6.4. Waiver of Past Defaults.
Holders of a majority of the aggregate principal amount of the then
outstanding Notes by written notice to the Company and the Trustee may on behalf
of the Holders of all of the Notes waive any existing Default or Event of
Default and its consequences under this Indenture except a continuing Default or
Event of Default in the payment of the principal of, or interest on, any Note
(other than a Default in the payment of principal of, or interest on, the Notes
that have become due as a result of acceleration) or a Default or an Event of
Default with respect to any covenant or provision which cannot be modified or
amended without the consent of the Holder of each outstanding Note affected.
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 impair any right consequent thereon.
Section 6.5. Control by Majority.
The Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. However, the Trustee may refuse to follow any direction
that conflicts with law or this Indenture, that the Trustee determines may be
unduly prejudicial to the rights of other Holders, or that may involve the
Trustee in personal liability.
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Section 6.6. Limitation on Suits.
A Holder may pursue a remedy with respect to this Indenture or the
Notes only if:
(a) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the
remedy;
(c) such Holder or Holders offer and, if requested, provide to the
Trustee indemnity satisfactory to the Trustee against any loss, liability
or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or
to obtain a preference or priority over another Holder.
Section 6.7. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal and interest on the Note,
on or after the respective due dates expressed in the Note, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of the Holder.
Section 6.8. Collection Suit by Trustee.
If an Event of Default specified in Section 6.1(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal and interest remaining unpaid on the Notes and interest on overdue
principal (and premium, if any) and, to the extent lawful, interest 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.
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Section 6.9. Trustee May File Proofs of Claim.
The Trustee is authorized to 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 reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relative to the Company (or any
other obligor under the Notes), their creditors or their property and shall be
entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such 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 to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7 hereof. 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 the Trustee under Section 7.7 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 that the Holders of the Notes
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 authorize 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.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in accordance with the requirements of the Intercreditor
Agreement and to the extent received in accordance therewith, in the following
order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.7, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes for
principal and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal and
interest, respectively;
Third: without duplication, to Holders for any other Obligations
owing to the Holders under the Notes or this Indenture; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any payment
to Holders.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.6, or a suit by Holders of more than 10% in principal
amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.1. Duties of Trustee.
(1) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture 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
his or her own affairs.
(2) Except during the continuance of an Event of Default:
(a) The duties of the Trustee shall be determined solely
by the express provisions of this Indenture, and the Trustee need perform
only those duties that 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.
(b) 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 and the Security Documents. However,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture and the
Security Documents.
(3) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(a) This paragraph does not limit the effect of
paragraph (2) of this Section.
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(b) The Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts.
(c) 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 6.5.
(4) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (1), (2) and (3) of this Section.
(5) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee may refuse
to perform any duty or exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(6) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(7) The Trustee is hereby authorized to act as Collateral
Agent and to enter into the Intercreditor Agreement.
Section 7.2. Rights of Trustee.
(1) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
(2) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the advice of such counsel or any Opinion of Counsel
shall 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.
(3) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(4) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers conferred upon it by this Indenture.
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(5) Unless otherwise specifically provided in this Indenture
or the Security Documents, any demand, request, direction or notice from the
Company shall be sufficient if signed by an Officer of the Company, on behalf of
the Company.
(6) Except with respect to Section 4.1, the Trustee shall have
no duty to inquire as to the performance of the Company's covenants in Article 4
hereof. In addition, the Trustee shall not be deemed to have knowledge of any
Default or Event of Default except (i) any Event of Default occurring pursuant
to Sections 6.1(1), 6.1(2) and 4.1, or (ii) any Default or Event of Default of
which the Trustee shall have received written notification or obtained actual
knowledge.
Section 7.3. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or an
Affiliate of the Company with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. However, the Trustee is
subject to Sections 7.10 and 7.11.
Section 7.4. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision hereof,
it shall not be responsible for the use or application of any money received by
any Paying Agent other than the Trustee and it shall not be responsible for any
statement or recital herein or any statement in the Notes or any other document
in connection with the sale of the Notes or pursuant to this Indenture other
than its certificate of authentication.
Section 7.5. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if the
Trustee has knowledge thereof (within the meaning of Section 7.2(6)), the
Trustee shall mail to the Holders a notice of the Default or Event of Default
within 90 days after it occurs.
Section 7.6. Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, the Trustee shall mail to the Holders a brief report
dated as of such reporting date that complies with TIA ss. 313(a) (but if no
event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA ss. 313(b). The Trustee shall also transmit by mail all
reports as required by TIA ss. 313(c).
Commencing at the time this Indenture is qualified under the TIA, a
copy of each report at the time of its mailing to the Holders shall be filed
with the Commission and
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each stock exchange on which the Notes are listed. The Company shall promptly
notify the Trustee when the Notes are listed on any stock exchange.
Section 7.7. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation for its acceptance of this Indenture and services hereunder as the
parties shall agree in writing from time to time (which compensation shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust). The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel, except such disbursements,
advances and expenses as may be attributable to its negligence.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it without negligence on its part arising
out of or in connection with the acceptance or administration of its duties
under this Indenture, except as set forth below. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee shall
cooperate in the defense. In the event that a conflict of interest or
conflicting defenses would arise in connection with the representation of the
Company and the Trustee by the same counsel, the Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent.
The obligations of the Company under this Section 7.7 shall survive
the satisfaction and discharge of this Indenture.
The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through its own negligence.
To secure the Company's payment obligations in this Section, the
Company hereby grants to the Trustee a security interest on all money or
property held or collected by the Trustee, except that held in trust to pay
principal of (and premium, if any) and interest on particular Notes. Such Lien
shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.1(9) or (10) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
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Section 7.8. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign at any time and be discharged from the trust
hereby created by so notifying the Company. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee 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 Company 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 then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee after written request by any Holder who has been a
Holder for at least six months fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. 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 the 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 7.7. Notwithstanding replacement of the Trustee pursuant to this
Section 7.8, the Company's obligations under Section 7.7 hereof shall continue
for the benefit of the retiring Trustee, and the Company
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shall pay to any such replaced or removed Trustee all amounts owed under Section
7.7 upon such replacement or removal.
Section 7.9. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that, if other than
U.S. Trust Company of California, N.A., shall (a) be a corporation organized and
doing business under the laws of the United States of America or of any state
thereof or of the District of Columbia authorized under such laws to exercise
corporate trustee power, (b) be subject to supervision or examination by Federal
or state or the District of Columbia authority, and (c) have a combined capital
and surplus of at least $100,000,000 as set forth in its most recent published
annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. ss. 310(a)(1), 310(a)(2) and 310(a)(5). The Trustee is
subject to TIA ss. 310(b); provided, however, that there shall be excluded from
the operations of TIA ss. 310(b)(1) any indenture or indentures under which
other securities, or certificates of interest or participation in other
securities, of the Company are outstanding, if the requirements for such
exclusion set forth in TIA ss. 310(b)(1) are met.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein. The
provisions of TIA ss. 311 shall apply to the Company, as obligor on the Notes.
ARTICLE 8
SATISFACTION AND DISCHARGE
Section 8.1. Discharge; Option to Effect Legal Defeasance or Covenant
Defeasance.
This Indenture shall cease to be of further effect (except that the
Company's and the Guarantors' obligations under Section 7.7 and the Trustee's
and the Paying Agent's obligations under Sections 8.6 and 8.7 shall survive)
when all outstanding Notes theretofore authenticated and issued have been
delivered (other than destroyed, lost or stolen Notes that have been replaced or
paid) to the Trustee for cancellation and the Company or the Guarantors have
paid all sums payable hereunder. In addition, the Company may elect at any
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time to have Section 8.2 or Section 8.3, at the Company's option, of this
Indenture applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article 8.
Section 8.2. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.1 hereof of the option
applicable to this Section 8.2, the Company and the Guarantors shall be deemed
to have been discharged from their respective obligations with respect to all
outstanding Notes on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented and this Indenture shall cease to be of further effect
as to all outstanding Notes and Guarantees, except as to be deemed to be
"outstanding" only for the purposes of Section 8.5 hereof and the other Sections
of this Indenture referred to in (a) and (b) below, and the Company and the
Guarantors shall be deemed to have satisfied all other of their respective
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive payments in respect of the principal of, premium,
if any, and interest (and Liquidated Damages, if any) on such Notes when such
payments are due from the trust described in Section 8.5, (b) the Company's
obligations with respect to such Notes under Sections 2.4, 2.6, 2.7, 2.10, 4.2,
8.5, 8.6 and 8.7 hereof and (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Company's and the Guarantors'
obligations in connection therewith. Subject to compliance with this Article 8,
the Company may exercise its option under this Section 8.2 notwithstanding the
prior exercise of its option under Section 8.3 hereof with respect to the Notes.
Section 8.3. Covenant Defeasance.
Upon the Company's exercise under Section 8.1 hereof of the option
applicable to this Section 8.3, the Company and the Guarantors shall be released
from their respective obligations under the covenants contained in Sections 4.3,
4.4, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.14, 4.15, 4.16, 4.17, 4.18 and Article 5
and Article 10 hereof with respect to the outstanding Notes on and after the
date the conditions set forth below are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder. For this
purpose, such Covenant Defeasance means that, with respect to the outstanding
Notes, neither the Company nor any Guarantor need comply with and shall have any
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, but, except as specified
above, the remainder of this Indenture and such Notes shall be unaffected
thereby. In addition, upon the Company's exercise under Section 8.1 hereof of
the option applicable to this Section 8.3, Sections 6.1(3) through 6.1(10)
hereof shall not constitute Events of Default with respect to the Notes.
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Section 8.4. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.2 or 8.3 hereof to the outstanding Notes:
(i) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 7.10 hereof who shall agree to comply with the provisions of this
Article 8 applicable to it), in trust, for the benefit of the Holders of the
Notes, cash, U.S. Government Obligations, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any, and
interest (and Liquidated Damages, if any) on such outstanding Notes on the
stated date for payment thereof or on the redemption date of such principal or
installment of principal of, premium, if any, or interest on such Notes, and the
holders of Notes must have a valid, perfected, exclusive security interest in
such trust, (ii) in the case of Legal Defeasance before the date that is one
year prior to the final stated maturity of the Notes, the Company shall have
delivered to the Trustee an opinion of counsel in the United States reasonably
acceptable to the trustee confirming that (A) the Company has received from, or
there has been published by, the Internal Revenue Service a ruling or (B) since
the date of this Indenture, there has been a change in the applicable Federal
income tax law, in either case to the effect that, and based thereon such
opinion of counsel shall confirm that, the Holders of such outstanding Notes
will not recognize income, gain or loss for Federal income tax purposes as a
result of such Legal Defeasance and will be subject to 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; (iii) in the case of Covenant
Defeasance before the date that is one year prior to the final stated maturity
of the Notes, the Company shall have delivered to the Trustee an opinion of
counsel in the United States reasonably acceptable to such Trustee confirming
that the Holders of such outstanding Notes will not recognize income, gain or
loss for Federal income tax purposes as a result of such Covenant Defeasance and
will be subject to 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; (iv) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit; (v) such Legal Defeasance or Covenant
Defeasance will not result in a breach or violation of, or constitute a default
under any material agreement or instrument to which the Company or any of its
Subsidiaries is bound; (vi) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of such Notes over the other creditors of
the Company with the intent of defeating, hindering, delaying or defrauding
other creditors of the Company; and (vii) the Company shall have delivered to
the Trustee an Officers' Certificate and an opinion of counsel, each stating
that the conditions precedent provided for, in the case of the Officers'
Certificate, (i) through (vi) and, in the case of the opinion of counsel,
clauses (i), (with respect to the validity and perfection of the security
interest) (ii), (iii) and (v) of this paragraph, have been complied with.
Section 8.5. Deposited Cash and U.S. Government Obligations to be Held in Trust;
Other
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Miscellaneous Provisions.
Subject to Section 8.6 hereof, all cash and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.5, the
"Paying Agent") pursuant to Section 8.4 hereof in respect of the outstanding
Notes shall be held in trust and applied by the Paying Agent, in accordance with
the provisions of such Notes and this Indenture, to the payment, either directly
or through any other Paying Agent as the Trustee may determine, to the Holders
of such Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest (and Liquidated Damages, if any), but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 8.4 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of Outstanding Notes.
Section 8.6. Repayment to the Company.
(a) Anything in this Article 8 to the contrary notwithstanding, the
Trustee or the Paying Agent shall deliver or pay to the Company from time to
time upon the request of the Company any cash or U.S. Government Obligations
held by it as provided in Section 8.4 hereof which in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.3(a) hereof), are in excess of the amount thereof that
would then be required to be deposited to effect an equivalent Legal Defeasance
or Covenant Defeasance.
(b) Any cash and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of, premium, if any, or
interest (and Liquidated Damages, if any) on any Security and remaining
unclaimed for two years after such principal, and premium, if any, or interest
has become due and payable shall be paid to the Company on its request; and the
Holder of such Security shall thereafter look only to the Company for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining will be repaid to the Company.
Section 8.7. Reinstatement.
If the Trustee or Paying Agent is unable to apply any cash or U.S.
Government Obligations in accordance with Section 8.2 or 8.3 hereof, as the case
may be, of this
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Indenture by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, or
if any event occurs at any time in the period ending on the 91st day after the
date of deposit pursuant to Section 8.4 hereof which event would constitute an
Event of Default under Section 6.1 (iv) or (v) had Legal Defeasance or Covenant
Defeasance, as the case may be, not occurred, then the Company's and the
Guarantors' obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.4 hereof
until such time as the Trustee or Paying Agent is permitted to apply such money
in accordance with Sections 8.2 and 8.3 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium, if
any, or interest (and Liquidated Damages, if any) on any Security following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the cash or U.S.
Government Obligations held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENTS
Section 9.1. Without Consent of Holders.
The Company, the Guarantors and the Trustee may amend or supplement
this Indenture and the Notes without the consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(3) to comply with Article 5 and Section 10.12 hereof;
(4) to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not materially
adversely affect the legal rights hereunder or thereunder of any Holder;
(5) to comply with requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA; or
(6) to release any Guarantee of the Notes permitted to be
released under Section 10.7 hereof.
Upon the request of the Company, accompanied by a resolution of the
Board of Directors of the Company authorizing the execution of any such
supplemental indenture or amendment, and upon receipt by the Trustee of the
documents described in Section 9.6 hereof required or requested by the Trustee,
the Trustee shall join with the Company in the execution of any supplemental
indenture or amendment authorized or permitted by the terms of this Indenture
and shall make any further appropriate agreements and stipulations which may be
therein contained, but the Trustee shall not be obligated to enter into such
supplemental
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indenture or amendment that affects its own rights, duties or immunities under
this Indenture or otherwise.
Section 9.2. With Consent of Holders.
Subject to Sections 6.4 and 6.7 hereof, the Company, the Guarantors
and the Trustee, as applicable, may amend, or waive any provision of, this
Indenture or the Notes, with the written consent of the Holders of at least a
majority of the principal amount of the then outstanding Notes (including
consents obtained in connection with a tender offer or exchange offer for
Notes).
Upon the request of the Company, accompanied by a resolution of the
Board of Directors of the Company authorizing the execution of any such
supplemental indenture or amendment, and upon filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders as aforesaid,
and upon receipt by the Trustee of the documents described in Section 9.6
hereof, the Trustee shall join with the Company in the execution of such
supplemental indenture or amendment unless such supplemental indenture or
amendment affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed supplemental indenture or
amendment, but it shall be sufficient if such consent approves the substance
thereof.
After a supplemental indenture or amendment under this Section
becomes effective, the Company shall mail to the Holders of each Note affected
thereby a notice briefly describing the amendment or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture, amendment
or waiver.
Notwithstanding any other provision hereof, without the consent of
each Holder affected, an amendment or waiver under this Section may not (with
respect to any Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for payment of
interest, including default interest, on any Note;
(3) reduce the principal of, or the premium on, or change the
fixed maturity of any Note or alter Article 3 hereof or numbered
paragraphs 5 or 6 of Exhibit A to this Indenture or the price at which the
Company shall offer to purchase such Notes pursuant to Sections 4.10 or
4.14 hereof;
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(4) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest on, or redemption payment
with respect to, any Note (other than a Default in the payment of an
amount due as a result of an acceleration if the Holders rescind such
acceleration pursuant to Section 6.2);
(5) make any Note payable in money other than that stated in
the Notes;
(6) make any change in Section 6.4 or 6.7 hereof or in this
Section 9.2; or
(7) make any change adversely affecting the contractual
ranking of the Obligations.
A meeting of Holders may be called at any time and from time to
time by the Company or the Trustee for the purpose of taking or consenting to
any action authorized or contemplated to be taken hereunder by the Holders,
notice of such meeting to be provided in the manner set forth herein.
Notwithstanding any other provision of this Indenture, the Trustee may make such
reasonable regulations as it may deem advisable for any action by or any meeting
of Holders.
Section 9.3. Compliance with Trust Indenture Act.
If, at the time of an amendment to this Indenture or the Notes, this
Indenture shall be qualified under the TIA, every amendment to this Indenture or
the Notes shall be set forth in a supplemental indenture that complies with the
TIA as then in effect.
Section 9.4. Revocation and Effect of Consents.
Until a supplemental indenture, an amendment or waiver becomes
effective, a consent to it by a Holder of a Note is a continuing consent by the
Holder and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. A supplemental indenture, amendment or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.
The Company may fix a record date for determining which Holders must
consent to such supplemental indenture, amendment or waiver. If the Company
fixes a record date, the record date shall be fixed at (i) 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 prior to such solicitation pursuant to
Section 2.5, or (ii) such other date as the Company shall designate.
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Section 9.5. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about a supplemental
indenture, amendment or waiver on any Note thereafter authenticated. The Company
in exchange for all Notes may issue and the Trustee shall authenticate new Notes
that reflect the amendment or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment or waiver.
Section 9.6. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment or supplemental indenture
authorized pursuant to this Article 9 if the amendment does not adversely affect
the rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing or refusing to sign such
amendment or supplemental indenture, the Trustee shall be entitled to receive,
if requested, an indemnity reasonably satisfactory to it and to receive and,
subject to Section 7.1, shall be fully protected in relying upon, an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that such amendment
or supplemental indenture is authorized or permitted by this Indenture, that it
is not inconsistent herewith, and that it shall be valid and binding upon the
Company in accordance with its terms. The Company may not sign an amendment or
supplemental indenture until the Board of Directors of the Company approves it.
ARTICLE 10
COLLATERAL AND SECURITY AND GUARANTY
Section 10.1. Collateral Documents.
The due and punctual payment of the principal and premium, if any,
of, and interest 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, shall be secured as provided in the Security Documents.
The Company shall, and shall cause each of its Restricted
Subsidiaries to, do or cause to be done all such acts and things as may be
necessary or proper, or as may be required by the provisions of the Security
Documents, to assure and confirm to the Collateral Agent the security interest
in the Collateral contemplated hereby and by the Security Documents, as from
time to time constituted, so as to render the same available for the security
and benefit of this Indenture and of the Notes secured hereby, according to the
intent and purposes herein and therein expressed. The Company shall, and shall
cause each of its Restricted Subsidiaries to, take, upon request of the Trustee
or the Collateral Agent, any and all actions required to cause the Security
Documents to create and maintain, as security for the Obligations, valid and
enforceable, perfected (except as expressly provided herein or
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therein), Liens in and on all the Collateral, in favor of the Collateral Agent,
superior to and prior to the rights of all third Persons, and subject to no
other Liens, other than as provided herein and therein.
Each Holder of a Note, by its acceptance thereof, consents and
agrees to the terms of the Security Documents and the Intercreditor Agreement
(including, without limitation, the provisions providing for foreclosure and
release of Collateral and indemnification of the Collateral Agent) as the same
may be in effect or may be amended from time to time in accordance with their
terms and authorizes and directs (i) the Collateral Agent, with respect to each
of the Security Documents to which it is a party and the Intercreditor
Agreement, and (ii) the Trustee, with respect to the Intercreditor Agreement, to
perform their respective obligations and exercise their respective rights
thereunder in accordance therewith; provided, however, that upon qualification
of this Indenture with the TIA, if any provision of the Intercreditor Agreement
limits, qualifies or conflicts with the duties imposed by the provisions of the
TIA, the TIA shall control.
Section 10.2. Opinions.
To the extent required by the TIA, the Company shall furnish to the
Trustee within three months after each anniversary of the Closing Date, an
Opinion of Counsel, dated as of such date, stating either that (i) in the
opinion of such counsel, all action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and refiling of all
supplemental indentures, financing statements, continuation statements or other
instruments of further assurance as is necessary to maintain the Liens of the
Security Documents and reciting the details of such action or (ii) in the
opinion of such Counsel, no such action is necessary to maintain such Liens,
which Opinion of Counsel also shall state what actions it then believes are
necessary to maintain the effectiveness of such liens during the next two years.
Section 10.3. Release and Substitution of Collateral.
(a) Subject to subsections (b) and (c) of this Section 10.3, (i) in
the event that any Collateral is sold, transferred or otherwise disposed of in
an Asset Sale or any other transaction permitted by this Indenture, such
Collateral shall, concurrently with the disposition of such Collateral or the
issuance of such Indebtedness, as the case may be, automatically be released
from the lien of the relevant Security Documents and (ii) the Company and its
Subsidiaries may from time to time substitute property or securities released
from the lien of the Security Documents in connection with the sale, transfer or
other disposition thereof for other property or securities to be subjected to
the lien of the Security Documents, in each case in accordance with the
provisions of the Security Documents.
(b) At any time when an Event of Default shall have occurred and be
continuing and the maturity of the Securities shall have been accelerated
(whether by declaration or otherwise) and such acceleration shall not have been
rescinded or annulled, no release of Collateral pursuant to the provisions of
this Indenture or of the Security Documents shall be effective as against the
Holders of the Securities without the consent of the Collateral Agent. The
Trustee shall promptly notify the Collateral Agent of any rescission or
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annulment, pursuant to Section 6.4 hereof, of an acceleration of the Securities.
(c) The release of any Collateral from the terms of the Security
Documents will not be deemed to impair the security under this Indenture in
contravention of the provisions hereof if and to the extent the Collateral is
released pursuant to the Security Documents. At all time after qualification of
this Indenture under the TIA, to the extent applicable, the Company shall cause
TIA Section 314(d) relating to the release of property or securities from the
lien of the Security Documents and relating to the substitution therefor of any
property or securities to be subjected to the lien of the Collateral Documents
to be complied with. Any certificate or opinion required by TIA Section 314(d)
may be made by an Officer of the Company, except in cases where TIA Section
314(d) requires that such certificate or opinion be made by an independent
person, which person shall be an independent engineer, appraiser or other expert
selected or approved by the Trustee in the exercise of reasonable care.
Section 10.4. Certificates of the Company.
The Company shall furnish to the Trustee prior to each proposed
release of Collateral other than by reason of transactions referred to in
Section 10.3(b), all documents required by TIA ss. 314(d). The Trustee may, to
the extent permitted by Sections 7.1 and 7.2 hereof, accept as conclusive
evidence of compliance with the foregoing provisions the appropriate statements
contained in such instruments. Any certificate or opinion required by TIA ss.
314(d) may be made by an Officer of the Company except in cases where TIA ss.
314(d) requires that such certificate or opinion be made by an independent
engineer, appraiser or other expert within the meaning of TIA ss. 314(d).
Section 10.5. Authorization of Actions to be Taken by the Trustee Under the
Security Documents.
Subject to the provisions of the Security Documents and the
Intercreditor Agreement, the Trustee 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 the terms of the
Security Documents and (b) collect and receive any and all amounts payable in
respect of the Obligations of the Company and the Guarantors hereunder. The
Trustee 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 that may be unlawful or in violation of the Security Documents or
this Indenture, and such suits and proceedings as the Trustee may deem 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 Trustee).
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Section 10.6. Authorization of Receipt of Funds by the Trustee Under the
Security Documents.
The Trustee is authorized to receive any funds for the benefit of
the Holders distributed 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.
Section 10.7. Release Upon Termination of the Company's Obligations.
(a) If (i) the Company delivers an Officer's Certificate certifying
that all of its obligations under this Indenture have been indefeasibly
satisfied and discharged by complying with the provisions of Article Eight
hereof or (ii) all outstanding Securities issued under this Indenture shall be
surrendered to the Trustee for cancellation, the Trustee shall deliver to the
Collateral Agent a notice stating that the Trustee, for itself and on behalf of
the Holders, disclaims and has given up any and all rights it has in or to the
Collateral, and any rights it has under the Security Documents, and, upon and
after the receipt by the Collateral Agent of such notice, the Collateral Agent
shall no longer be deemed to hold the Lien in the Collateral on behalf of the
Trustee for the benefit of itself and the Holders.
(b) Any release of Collateral made in compliance with this Section
10.7 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.
Section 10.8. Guaranty.
For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, subject to Section 10.10 hereof, each Guarantor,
jointly and severally, hereby unconditionally guarantees (such guarantees,
together with further guarantees granted from time to time pursuant to Section
10.13, being the "Guaranty") to each Holder, the Trustee and the Collateral
Agent, irrespective of the validity or enforceability of this Indenture, the
Notes, the Security Documents or the Obligations hereunder or thereunder: (i)
the due and punctual payment of the principal and premium, if any, of, and
interest on, the Notes (including, without limitation, interest after the filing
of a petition initiating any proceedings referred to in clause (9) or (10) of
Section 6.1 hereof), whether at maturity or on an interest payment date, by
acceleration, call for redemption or otherwise; (ii) the due and punctual
payment of interest on the overdue principal and premium, if any, of, and
interest on, the Notes, if lawful; (iii) the due and punctual payment and
performance of all other Obligations, all in accordance with the terms set forth
herein and in the Notes and the Security Documents; and (iv) in case of any
extension of time of payment or renewal of any Notes or any of such other
Obligations, the due and punctual payment or performance thereof in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
Failing payment when due by the Company of any amount so guaranteed
for whatever reason, the Guarantors shall be jointly and severally obligated to
pay the same immediately.
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Each Guarantor hereby agrees that (i) its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes, this Indenture, the Security Documents or the
Obligations hereunder or thereunder, the absence of any action to enforce the
same, any waiver or consent by any Holder with respect to any provisions hereof
or thereof, any releases of Collateral, any amendment of the Indenture, the
Notes or Security Documents, any delays in obtaining or realizing upon or
failures to obtain or realize upon Collateral, the recovery of any judgment
against the Company or any of its Subsidiaries, any action to enforce the same,
or any other circumstance that might otherwise constitute a legal or equitable
discharge or defense of a guarantor and (ii) this Guaranty will not be
discharged except by complete performance of the Obligations.
Each Guarantor hereby agrees that it shall not be entitled to and
irrevocably waives (i) diligence, presentment, demand of payment, filing of
claim with a court in the event of insolvency or bankruptcy of the Company, any
Guarantor, any other Subsidiary of the Company or any other obligor under the
Notes, any right to require a proceeding first against the Company, any
Guarantor, any other Subsidiary of the Company or any other obligor under this
Indenture, the Notes or the Security Documents, protest, notice and all demands
whatsoever, (ii) any right of subrogation, reimbursement, exoneration,
contribution or indemnification in respect of any Obligations guaranteed hereby
and (iii) any claim or other rights that it may now or hereafter acquire against
the Company or any of its Subsidiaries that arise from the existence or
performance of its Obligations under this Guaranty, including, without
limitation, any right to participate in any claim or remedy of a Holder against
the Company or any of its Subsidiaries or any Collateral that a Holder now has
or hereafter acquires, whether or not such claim, remedy or right arises in
equity or under contract, statute or common law, by any payment made hereunder
or otherwise, and including, without limitation, the right to take or receive
from the Company or any of its Subsidiaries, directly or indirectly, in cash or
other property, by setoff or in any other manner, payment or security on account
of such claim or other rights.
If any Holder or the Trustee is required by any court or otherwise
to return to the Company, any Guarantor, any other Subsidiary of the Company or
any other obligor under this Indenture, the Notes or the Security Documents,
trustee, liquidator, or other similar official, any amount paid by the Company,
any Guarantor, any other Subsidiary of the Company or any other obligor under
this Indenture, the Notes or the Security Documents to the Trustee or such
Holder, this Guaranty, to the extent theretofore discharged, shall be reinstated
in full force and effect.
Each Guarantor agrees that, as between the Guarantors, on the one
hand, and the Holders and the Trustee, on the other hand, (i) the maturity of
the Obligations guaranteed hereby may be accelerated as provided in Section 6.2
for the purposes of this Guaranty, notwithstanding any stay, injunction or other
prohibition preventing such acceleration as to the Company of the Obligations
guaranteed hereby, and (ii) in the event of any declaration of acceleration of
those Obligations as provided in Section 6.2, those Obligations (whether or not
due and payable) will forthwith become due and payable by each of the Guarantors
for the purpose of this Guaranty.
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Section 10.9. Execution and Delivery of Guaranty.
To evidence the Guaranty set forth in Section 10.8 the Company and
each Guarantor hereby agrees that (a) a notation of such Guaranty substantially
as set forth on Exhibit C hereto shall be endorsed on each Note authenticated
and delivered by the Trustee. Such endorsement shall be executed on behalf of
each Guarantor by its Chairman of the Board, President, Chief Financial Officer,
Chief Operating Officer, Treasurer, Secretary or any Vice President and (b) a
counterpart signature page to this Indenture shall be executed on behalf of each
Guarantor by its Chairman of the Board, President or one of its Vice Presidents
and attested to by another officer acknowledging such Guarantor's agreement to
be bound by the provisions hereof and thereof.
Each Guarantor hereby agrees that its Guaranty set forth in Section
10.8 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Guaranty.
If an officer whose signature is on this Indenture no longer holds
that office at the time the Trustee authenticates the Notes on which a Guaranty
is endorsed, the Guaranty shall nevertheless be valid.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guaranty set forth in
this Indenture on behalf of the Guarantor.
Section 10.10. Limitation on Guarantor's Liability.
Each Guarantor and by its acceptance hereof each Holder hereby
confirms that it is the intention of all such parties that the guarantee by such
Guarantor pursuant to its Guaranty not constitute a fraudulent transfer or
conveyance for purposes of any Federal or state law. To effectuate the foregoing
intention, the Holders and the Guarantors hereby irrevocably agree that the
obligations of each Guarantor under its Guaranty shall be limited to the maximum
amount as will, after giving effect to all other contingent and fixed
liabilities of such Guarantor and to any collections from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under its Guaranty, result in the Obligations of such Guarantor under
the Guaranty not constituting a fraudulent conveyance or fraudulent transfer
under Federal or state law.
Section 10.11. Rights under the Guaranty.
(a) No payment by any Guarantor pursuant to the provisions hereof
shall entitle such Guarantor to any payment out of any Collateral or give rise
to any claim of the Guarantors against the Trustee or any Holder.
(b) Each Guarantor waives notice of the issuance, sale and purchase
of the Notes and notice from the Trustee or the Holders from time to time of any
of the Notes of their acceptance and reliance on this Guaranty.
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(c) No set-off, counterclaim, reduction or diminution of any
obligation or any defense of any kind or nature (other than performance by the
Guarantors of their obligations hereunder) that any Guarantor may have or assert
against the Trustee or any Holder shall be available hereunder to such
Guarantor.
(d) Each Guarantor shall pay all costs, expenses and fees, including
all reasonable attorneys' fees, that may be incurred by the Trustee in enforcing
or attempting to enforce the Guaranty or protecting the rights of the Trustee or
the Holder, if any, in accordance with this Indenture.
Section 10.12. Primary Obligations.
The Obligations of each Guarantor hereunder shall constitute a
guaranty of payment and not of collection. Each Guarantor agrees that it is
directly liable to each Holder hereunder, that the Obligations of each Guarantor
hereunder are independent of the Obligations of the Company or any other
Guarantor, and that a separate action may be brought against each Guarantor,
whether such action is brought against the Company or any other Guarantor or
whether the Company or any other Guarantor is joined in such action. Each
Guarantor agrees that its liability hereunder shall be immediate and shall not
be contingent upon the exercise or enforcement by the Trustee or the Holders of
whatever remedies they may have against the Company or any other Guarantor, or
the enforcement of any lien or realization upon any security Trustee may at any
time possess. Each Guarantor agrees that any release that may be given by the
Trustee or the Holders to the Company or any other Guarantor shall not release
such Guarantor.
Section 10.13. Guarantee by Subsidiary.
(a) The Company shall cause each Restricted Subsidiary that is
formed or acquired after the date hereof or that otherwise becomes a Restricted
Subsidiary after the date hereof, in each case concurrently therewith, to (i)
become a Guarantor hereunder and execute and deliver to the Trustee a Guaranty
in the form of Exhibit C attached hereto and a supplemental indenture in form
reasonably satisfactory to the Trustee pursuant to which such Restricted
Subsidiary shall unconditionally guarantee all of the Company's Obligations as
set forth in Section 10.8 of this Indenture; and (ii) execute a Security
Agreement (substantially in the form of the Security Agreement entered into on
the Closing Date) and other Security Documents necessary or reasonably requested
by the Trustee to grant the Trustee a valid, enforceable, perfected Lien on the
Collateral described therein, subject only to Liens permitted under Section
4.12; and (iii) cause such Restricted Subsidiary to deliver to the Trustee an
Opinion of Counsel, in form reasonably satisfactory to the Trustee, that (i)
such Security Agreement, supplemental indenture and Guaranty have been duly
authorized, executed and delivered by such Restricted Subsidiary and (ii) such
Security Agreement, this Indenture and such Guaranty constitute a legal, valid,
binding and enforceable obligation of such Restricted Subsidiary, subject to
customary exceptions for bankruptcy, fraudulent transfer and equitable
principles.
Each Note issued after the date of execution by any Guarantor of a
Guaranty
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shall be endorsed with a form of Guaranty that has been executed by such
Guarantor. However, the failure of any Note to have endorsed thereon a Guaranty
executed by such Guarantor shall not affect the validity or enforceability of
such Guaranty against such Guarantor.
Section 10.14. Release of Guarantors.
If all of the Capital Stock of any Guarantor is sold to a Person
(other than the Company or any of its Restricted Subsidiaries), then such
Guarantor will be released and discharged from all of its obligations under its
Guarantee of the Notes and this Indenture.
ARTICLE 11
MISCELLANEOUS
Section 11.1. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss. 318(c), the imposed duties shall control.
Section 11.2. Notices.
Any notice or communication by the Company or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by
first-class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' addresses:
If to the Company:
American Restaurant Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Trustee:
U.S. Trust Company of California, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
The Company or the Trustee by notice to the others may designate
additional or different addresses for subsequent notices or communications.
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All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; upon receipt, if deposited in the mail, postage prepaid;
when answered back, if telexed; when receipt acknowledged, if telecopied; and
the next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery. All notices and communications to
the Trustee shall be deemed to have been duly given only if actually received by
the Trustee.
Any notice or communication to a Holder shall be mailed by
first-class mail, certified or registered, return receipt requested, to his
address shown on the register kept by the Registrar. 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 communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 11.3. Communication by Holders with Other Holders.
Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and any other person shall have the
protection of TIA ss. 312(c).
Section 11.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 11.5) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 11.5) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been complied with.
Section 11.5. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall include:
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(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(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;
(c) a statement that, in the opinion of such Person, 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
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with,
provided that with respect to matters of fact, an Opinion of Counsel may rely
upon an Officers' Certificate or a certificate of a public official.
Section 11.6. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 11.7. Legal Holidays.
If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
Section 11.8. No Recourse Against Others.
No director, officer, employee, incorporator, stockholder or
controlling person of the Company or any Guarantor, as such, shall have any
liability for any obligations of the Company or any Guarantor under the Notes,
this Indenture or the Registration Rights Agreement or for any claim based on,
in respect of, or by reason of such obligations or their creation. Each Holder
by accepting a Note waives and releases all such liability. The waiver and
release shall be part of the consideration for the issuance of the Notes and the
Guarantees. Notwithstanding the foregoing, nothing in this provision shall be
construed as a waiver or release of any claims under the Federal securities
laws.
Section 11.9. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. THE
72
71
COMPANY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW,
TRIAL BY JURY AND ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY IRREVOCABLY CONSENTS, TO
THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TO THE SERVICE
OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING
BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE
PREPAID, TO THE COMPANY AT ITS ADDRESS SET FORTH HEREIN, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE TRUSTEE OR ANY NOTEHOLDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN
ANY OTHER JURISDICTION.
Section 11.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan
or debt agreement of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
Section 11.11. Successors.
All agreements of the Company and any Guarantors in this Indenture
and the Notes shall bind their respective successors. All agreements of the
Trustee in this Indenture shall bind its successor.
Section 11.12. Severability.
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.
73
72
Section 11.13. Counterpart Originals.
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.
Section 11.14. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
74
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Indenture as of the date first written above.
AMERICAN RESTAURANT GROUP, INC.
Attest: By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: V.P. & Chief Financial Officer
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
GUARANTORS
ARG ENTERPRISES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: V.P. & Chief Financial Officer
LOCAL FAVORITE, INC. ▇▇▇▇▇▇'▇. INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
----------------------------- ----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: V.P. & Chief Financial Officer Title: V.P. & Chief Financial Officer
SPOONS RESTURANTS, INC. SPECTRUM FOODS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
----------------------------- ----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: V.P. & Chief Financial Officer Title: V.P. & Chief Financial Officer
75
ARG PROPERTY MANAGEMENT
CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: V.P. & Chief Financial Officer
U.S. TRUST COMPANY OF CALIFORNIA,
N.A., as Trustee
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
-----------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Authorized Officer
76
A-2
EXHIBIT A
(Face of Security)
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST
COMPANY (THE "DEPOSITORY") TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DEPOSITORY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR
SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DEPOSITORY), 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.1
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, 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, REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE 144(K) AS PERMITTING
RESALES BY NON-AFFILIATES OF RESTRICTED SECURITIES WITHOUT RESTRICTION) AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY
PREDECESSOR OF SUCH NOTE) EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT, 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 FOREIGN PERSONS THAT OCCUR IN OFFSHORE TRANSACTIONS AND
WITHOUT DIRECTED SELLING EFFORTS WITHIN THE MEANINGS OF SUCH TERMS AS DEFINED IN
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS PURCHASING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE.
This paragraph should be included only if the Note is issued in
global form.
77
AMERICAN RESTAURANT GROUP, INC.
11 1/2% SENIOR SECURED NOTE
DUE 2003
No. $___________
CUSIP NO.
American Restaurant Group, Inc., a Delaware corporation (the
"Company"), as obligor, for value received promises to pay to ______________ or
registered assigns, the principal sum of Dollars on February 15, 2003. Interest
Payment Dates: February 15 and August 15. Record Dates: February 1 and August 1
(whether or not a Business Day).
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers.
Dated:
AMERICAN RESTAURANT GROUP, INC.
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
Trustee's Certificate of Authentication:
This is one of the Notes referred to
in the within-mentioned Indenture:
[ ], as Trustee
By:______________________________
Authorized Signature
78
(Back of Security)
11 1/2% SENIOR SECURED NOTE
DUE 2003
1. Interest. American Restaurant Group, Inc., a Delaware corporation
(the "Company"), as obligor, promises to pay interest on the principal amount of
this Note at the rate and in the manner specified below.
The Company shall pay, in cash, interest on the principal amount of
this Note, at the rate of 11.5% per annum. The Company shall pay interest
semi-annually on February 15 and August 15 of each year, and on the maturity
date, commencing on August 15, 1998, or if any such day is not a Business Day,
on the next succeeding Business Day (each an "Interest Payment Date").
Interest shall be computed on the basis of a 360-day year consisting
of twelve 30-day months. Interest shall accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from February 24,
1998. To the extent lawful, the Company shall pay interest on overdue
installments of interest (without regard to any applicable grace periods) at the
same rate.
2. Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the record date next preceding the Interest Payment
Date, even if such Notes are cancelled after such record date and on or before
such Interest Payment Date. The Holder must surrender this Note to a Paying
Agent to collect principal payments. The Company shall pay interest in money of
the United States that at the time of payment is legal tender for payment of
public and private debts. The Company, however, may pay interest by check to a
Holder's registered address.
3. Paying Agent and Registrar. Initially, the Trustee shall act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-registrar without notice to any Holder. Subject to certain exceptions, the
Company or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Notes under an Indenture dated
as of February 25, 1998 (the "Indenture") among the Company, the Guarantors
named therein and the Trustee. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (the "TIA") (15 U.S. Code ▇▇.▇▇. 77aaa-77bbbb) as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA and thereafter as in effect on the date the Indenture is
so qualified. The Notes are subject to all such terms, and Holders are referred
to the Indenture and such act for a statement of such terms. The terms of the
Indenture shall govern any inconsistencies between the Indenture and the Notes.
Terms not otherwise defined herein shall have the meanings assigned in the
Indenture. The Notes are limited to $158,600,000 in aggregate outstanding
principal amount.
The Obligations under the Indenture, the Notes and the Guarantee
thereof are secured by the Collateral described in the Security Documents,
subject to the provisions of such agreement. Holders are referred to the
Security Agreement for a statement of such terms.
5. Optional Redemption. The Notes are not redeemable at the
Company's option prior to February 15, 2001. Thereafter, the Notes will be
subject to redemption at the
79
2
option of the Company, in whole or in part, at the redemption prices (expressed
as percentages of principal amount) set forth below plus accrued and unpaid
interest thereon, if any, to the applicable redemption date, if redeemed during
the 12-month period beginning on February 15 of the years indicated below:
Year Percentage
---- ----------
2001....................... 105.75%
2002 and thereafter........ 100.00%
Notwithstanding the foregoing, at any time or from time to time
prior to February 15, 2000, the Company may, at its option, redeem up to
one-third of the original principal amount of the Notes, at a redemption price
of 111.5% of the principal amount thereof, plus accrued and unpaid interest, if
any, to the applicable redemption date, with the net cash proceeds of one or
more Qualified Equity Offerings; provided, that (a) such redemption shall occur
within 60 days of the date of closing of such public offering and (b) at least
two-thirds of the original aggregate principal amount of Notes remains
outstanding immediately after giving effect to each such redemption.
6. Mandatory Redemption. There shall be no mandatory redemption of
the Notes.
7. Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Registrar and the Company need not exchange
or register the transfer (i) of any Note or portion of a Note selected for
redemption or (ii) of any Notes for a period of 15 days before a selection of
Notes to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
8. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes, subject to the provisions of the
Indenture with respect to the record dates for the payment of interest.
9. Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the then outstanding Notes (including
consents obtained in connection with a tender offer or exchange offer for
Notes), and any existing Default or Event of Default (except certain payment
defaults) may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for Notes). Without the consent
of any Holders, the Indenture and the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for assumption of the
Company's obligations to the Holders in the case of a merger or consolidation,
to provide for uncertificated Notes in addition to or in place of certificated
Notes, to make any change that would provide any additional rights or benefits
to the Holders of the Notes, or that does not adversely affect the legal rights
under the Indenture of any Holder, to release any Guarantee of the Notes
permitted to be released under the terms of the Indenture or
80
3
to comply with requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the TIA.
10. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare by written notice to the Company and the
Trustee all the Notes to be due and payable immediately, except that in the case
of an Event of Default arising from certain events of bankruptcy or insolvency,
all outstanding Notes become due and payable immediately without further action
or notice. Holders may not enforce the Indenture or the Notes except as provided
in the Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Notes. Subject to certain limitations, Holders of
a majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Company must furnish an
annual compliance certificate to the Trustee.
11. Trustee Dealings with Company. The Trustee under the Indenture,
in its individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may otherwise
deal with the Company or its Affiliates, as if
it were not Trustee.
12. No Recourse Against Others. No director, officer, employee,
incorporator, stockholder or controlling person of the Company or Guarantor, as
such, shall have any liability for any obligations of the Company or any
Guarantor under the Notes, the Indenture or the Registration Rights Agreement or
for any claim based on, in respect of, or by reason of such obligations or their
creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes and the Guarantees. Notwithstanding the foregoing, nothing in this
provision shall be construed as a waiver or release of any claims under the
Federal securities laws.
13. Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
14. 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).
15. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and has directed the Trustee to use
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 thereon.
16. Holders' Compliance with Registration Rights Agreement. Each
Holder of a Note, by his acceptance thereof, acknowledges and agrees to the
provisions of the Registration Rights Agreement, dated as of February 25, 1998,
among the Company and the parties named on the signature page thereof (the
"Registration Rights Agreement").
81
4
The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to: American Restaurant Group, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer.
THIS NOTE (INCLUDING THE GUARANTY ENDORSED HEREON) SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
82
5
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
---------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint______________________________ agent to transfer this
Note on the books of the Company. The agent may substitute another to act for
him.
---------------------------------------------------------------------
Date:
-------------------
Your Signature:
--------------------
(Sign exactly as your name appears
on the face of this Note)
Signature Guarantee*
----------------
* NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
programs:
(1) The Securities Transfer Agent Medallian Program (STAMP);
(2) The New York Stock Exchange Medallian Program (MSP);
(3) The Stock Exchange Medallian Program (SEMP).
83
6
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, as the case
may be, state the amount you elect to have purchased (if all, write "ALL"):
$
----------------
Date:
-------------------
Your Signature:
--------------------
(Sign exactly as your name appears
on the face of this Note)
Signature Guarantee*
--------------
* NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
programs:
(1) The Securities Transfer Agent Medallian Program (STAMP);
(2) The New York Stock Exchange Medallian Program (MSP);
(3) The Stock Exchange Medallian Program (SEMP).
84
SCHEDULE OF EXCHANGES OF DEFINITIVE NOTES**
The following exchanges of a part of this Global Note for Definitive
Notes have been made:
Principal Amount of Signature of autho-
Amount of decrease in Amount of increase in this Global Note rized signatory of
Principal Amount of Principal Amount of following such decrease Trustee
Date of Exchange this Global Note this Global Note (or increase)
--------------------------------------------------------------------------------------------------------------------------------
--------
This should be included only if the Note is issued in global form.
85
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF NOTES
Re: [Series A] [Series B] [ ]% Senior Notes due 2003 (the "Notes") of American
Restaurant Group, Inc.
This Certificate relates to $______ principal amount of Notes held in *
|_| book-entry or * |_| definitive form by _______________________ (the
"Transferor").
The Transferor, by written order, has requested the Trustee:
|_| to deliver in exchange for its beneficial interest in the Global Note held
by the depository, a Note or Notes in definitive, registered form of
authorized denominations and an aggregate principal amount equal to its
beneficial interest in such Global Note (or the portion thereof indicated
above); or
|_| to exchange or register the transfer of a Note or Notes. In connection
with such request and in respect of each such Note, the Transferor does
hereby certify that Transferor is familiar with the Indenture relating to
the above captioned Notes and, the transfer of this Note does not require
registration under the Securities Act of 1933, as amended (the "Securities
Act") because such Note:
|_| is being acquired for the Transferor's own account, without transfer;
|_| is being transferred pursuant to an effective registration statement;
|_| is being transferred to a "qualified institutional buyer" (as defined in
Rule 144A under the Securities Act), in reliance on such Rule 144A;
|_| is being transferred pursuant to an exemption from registration in
accordance with Rule 904 under the Securities Act;**
|_| is being transferred pursuant to Rule 144 under the Securities Act;** or
|_| is being transferred pursuant to another exemption from the registration
requirements of the Securities Act (explain: ____________________________
_____________________________________________________________________).**
------------------------------
[INSERT NAME OF TRANSFEROR]
By:___________________________
Date:_____________________
* Check applicable box.
** If this box is checked, this certificate must be accompanied by an
opinion of counsel to the effect that such transfer is in compliance
with the Securities Act.
86
EXHIBIT C
[FORM OF GUARANTY]
GUARANTY
For good and valuable consideration received from the Company by the
undersigned (hereinafter referred to as the "Guarantors," which term includes
any successor or additional Guarantors), the receipt and sufficiency of which is
hereby acknowledged, subject to and in accordance with, Sections 10.8 through
10.14 of the Indenture, each Guarantor, jointly and severally, hereby
unconditionally guarantees, irrespective of the validity or enforceability of
the Indenture, the Notes, the Security Documents or the Obligations, (a) the due
and punctual payment of the principal and premium, if any, of and interest on
the Notes (including, without limitation, interest after the filing of a
petition initiating any proceedings referred to in Sections 6.1(9) or (10) of
the Indenture), whether at maturity or on an interest payment date, by
acceleration, call for redemption or otherwise, (b) the due and punctual payment
of interest on the overdue principal and premium, if any, of and interest, if
any, on the Notes, if lawful, (c) the due and punctual payment and performance
of all other Obligations, all in accordance with the terms set forth in the
Indenture, the Notes and the Security Documents, and (d) in case of any
extension of time of payment or renewal of any Notes or any of such other
Obligations, the due and punctual payment or performance thereof in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
No director, officer, employee, incorporator, stockholder or
controlling person of the Guarantor, as such, shall have any liability under
this Guaranty for any obligations of the Guarantor under the Notes, the
Indenture or the Registration Rights Agreement or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
the Notes by accepting a Note waives and releases all such liability.
ARG ENTERPRISES, INC.
By: ____________________________
Name: _________________________
Title: __________________________
LOCAL FAVORITE, INC. ▇▇▇▇▇▇'▇, INC.
By: ____________________________ By: ____________________________
Name: _________________________ Name: _________________________
Title: __________________________ Title: __________________________
SPOONS RESTAURANTS, INC. SPECTRUM FOODS, INC.
By: ____________________________ By: ____________________________
Name: _________________________ Name: _________________________
Title: __________________________ Title: __________________________
ARG PROPERTY MANAGEMENT
CORPORATION
By: ____________________________
Name: _________________________
Title: __________________________
87
2
88
CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
----------- -----------------
310(a)(1)....................................................... 7.10
(a)(2)...................................................... 7.10
(a)(3)...................................................... N.A.
(a)(4)...................................................... N.A.
(a)(5)...................................................... 7.10
(b)......................................................... 7.8; 7.10
(c)......................................................... N.A.
311(a).......................................................... 7.11
(b)......................................................... 7.11
(c)......................................................... N.A.
312(a).......................................................... 2.5
(b)......................................................... 11.3
(c)......................................................... 11.3
313(a).......................................................... 7.6
(b)(1)...................................................... 7.6
(b)(2)...................................................... 7.6
(c)......................................................... 7.6
(d)......................................................... 7.6
314(a).......................................................... 4.3; 4.4
(b)......................................................... N.A
(c)(1)...................................................... 11.4
(c)(2)...................................................... 11.4
(c)(3)...................................................... N.A.
(d)......................................................... N.A.
(e)......................................................... 11.5
(f)......................................................... N.A.
315(a).......................................................... 7.1(2)
(b)......................................................... 7.5
(c)......................................................... 7.1(1)
(d)......................................................... 7.1(3)
(e)......................................................... 6.11
316(a)(last sentence)........................................... 2.9
(a)(1)(A)................................................... 6.5
(a)(1)(B)................................................... 6.4
(a)(2)...................................................... N.A.
(b)......................................................... 9.2
(c)......................................................... 9.4
317(a)(1)....................................................... 6.8
(a)(2)...................................................... 6.9
(b)......................................................... 2.4
318(a).......................................................... 11.1
(b)......................................................... N.A.
(c)......................................................... 11.1
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
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ARTICLE 1 DEFINITIONS AND INCORPORATIONBY REFERENCE
Section 1.1. Definitions............................................ 1
Section 1.2. Other Definitions...................................... 19
Section 1.3. Incorporation by Reference of Trust Indenture Act...... 19
Section 1.4. Rules of Construction.................................. 20
ARTICLE 2 THE NOTES
Section 2.1. Form and Dating........................................ 21
Section 2.2. Execution and Authentication........................... 21
Section 2.3. Registrar, Paying Agent and Depository................. 22
Section 2.4. Paying Agent to Hold Money in Trust.................... 23
Section 2.5. Holder Lists........................................... 24
Section 2.6. Transfer and Exchange.................................. 24
Section 2.7. Replacement Notes...................................... 29
Section 2.8. Outstanding Notes...................................... 29
Section 2.9. Treasury Notes......................................... 30
Section 2.10. Temporary Notes........................................ 30
Section 2.11. Cancellation........................................... 31
Section 2.12. Defaulted Interest..................................... 31
Section 2.13. Legends................................................ 31
ARTICLE 3 REDEMPTION
Section 3.1. Notices to Trustee..................................... 32
Section 3.2. Selection of Notes to Be Redeemed...................... 33
Section 3.3. Notice of Redemption................................... 33
Section 3.4. Effect of Notice of Redemption......................... 34
Section 3.5. Deposit of Redemption Price............................ 34
Section 3.6. Notes Redeemed in Part................................. 35
Section 3.7. Optional Redemption.................................... 35
ARTICLE 4 COVENANTS
Section 4.1. Payment of Notes....................................... 36
Section 4.2. Maintenance of Office or Agency........................ 36
Section 4.3. Reports................................................ 37
Section 4.4. Compliance Certificate................................. 38
Section 4.5. Taxes.................................................. 39
Section 4.6. Stay, Extension and Usury Laws......................... 39
Section 4.7. Limitation on Restricted Payments...................... 39
Section 4.8. Limitation on Restrictions on Subsidiary Dividends..... 42
Section 4.9. Limitation on Incurrence of Indebtedness............... 44
Section 4.10. Limitation on Asset Sales.............................. 46
Section 4.11. Limitation on Transactions With Affiliates............. 49
Section 4.12. Limitation on Liens.................................... 50
Section 4.13. Corporate Existence.................................... 50
Section 4.14. Repurchase Upon a Change of Control.................... 51
Section 4.15. Maintenance of Properties.............................. 53
Section 4.16. Maintenance of Insurance............................... 53
Section 4.17. Restrictions on Sale and Issuance of Subsidiary Stock.. 53
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Section 4.18. Line of Business....................................... 54
ARTICLE 5 SUCCESSORS
Section 5.1. When the Company May Merge, etc......................... 54
Section 5.2. Successor Substituted................................... 55
ARTICLE 6 DEFAULTS AND REMEDIES
Section 6.1. Events of Default....................................... 56
Section 6.2. Acceleration............................................ 58
Section 6.3. Other Remedies.......................................... 59
Section 6.4. Waiver of Past Defaults................................. 59
Section 6.5. Control by Majority..................................... 60
Section 6.6. Limitation on Suits..................................... 60
Section 6.7. Rights of Holders to Receive Payment.................... 61
Section 6.8. Collection Suit by Trustee.............................. 61
Section 6.9. Trustee May File Proofs of Claim........................ 61
Section 6.10. Priorities............................................. 62
Section 6.11. Undertaking for Costs.................................. 63
ARTICLE 7 TRUSTEE
Section 7.1. Duties of Trustee....................................... 63
Section 7.2. Rights of Trustee....................................... 64
Section 7.3. Individual Rights of Trustee............................ 65
Section 7.4. Trustee's Disclaimer.................................... 66
Section 7.5. Notice of Defaults...................................... 66
Section 7.6. Reports by Trustee to Holders........................... 66
Section 7.7. Compensation and Indemnity.............................. 67
Section 7.8. Replacement of Trustee.................................. 68
Section 7.9. Successor Trustee by Merger, etc........................ 69
Section 7.10. Eligibility; Disqualification........................... 69
Section 7.11. Preferential Collection of Claims Against Company....... 70
ARTICLE 8 SATISFACTION AND DISCHARGE
Section 8.1. Discharge; Option to Effect Legal Defeasance or
Covenant Defeasance .................................. 70
Section 8.2. Legal Defeasance and Discharge.......................... 70
Section 8.3. Covenant Defeasance..................................... 71
Section 8.4. Conditions to Legal or Covenant Defeasance.............. 72
Section 8.5. Deposited Cash and U.S. Government Obligations to be
Held in Trust; Other Miscellaneous Provisions......... 73
Section 8.6. Repayment to the Company................................ 73
Section 8.7. Reinstatement........................................... 74
ARTICLE 9 AMENDMENTS
Section 9.1. Without Consent of Holders.............................. 75
Section 9.2. With Consent of Holders................................. 76
Section 9.3. Compliance with Trust Indenture Act..................... 77
Section 9.4. Revocation and Effect of Consents....................... 78
Section 9.5. Notation on or Exchange of Notes........................ 78
Section 9.6. Trustee to Sign Amendments, etc......................... 78
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ARTICLE 10 COLLATERAL AND SECURITY AND GUARANTY
Section 10.1. Collateral Documents................................... 79
Section 10.2. Opinions............................................... 80
Section 10.3. Release and Substitution of Collateral................. 80
Section 10.4. Certificates of the Company............................ 81
Section 10.5. Authorization of Actions to be Taken by the Trustee
Under the Security Documents......................... 81
Section 10.6. Authorization of Receipt of Funds by the Trustee
Under the Security Documents......................... 82
Section 10.7. Release Upon Termination of the Company's Obligations.. 82
Section 10.8. Guaranty............................................... 82
Section 10.9. Execution and Delivery of Guaranty..................... 84
Section 10.10. Limitation on Guarantor's Liability.................... 85
Section 10.11. Rights under the Guaranty.............................. 85
Section 10.12. Primary Obligations.................................... 86
Section 10.13. Guarantee by Subsidiary................................ 86
Section 10.14. Release of Guarantors.................................. 87
ARTICLE 11 MISCELLANEOUS
Section 11.1. Trust Indenture Act Controls........................... 87
Section 11.2. Notices................................................ 88
Section 11.3. Communication by Holders with Other Holders............ 89
Section 11.4. Certificate and Opinion as to Conditions Precedent..... 89
Section 11.5. Statements Required in Certificate or Opinion.......... 89
Section 11.6. Rules by Trustee and Agents............................ 90
Section 11.7. Legal Holidays......................................... 90
Section 11.8. No Recourse Against Others............................. 90
Section 11.9. Governing Law.......................................... 91
Section 11.10. No Adverse Interpretation of Other Agreements.......... 91
Section 11.11. Successors............................................. 92
Section 11.12. Severability........................................... 92
Section 11.13. Counterpart Originals.................................. 92
Section 11.14. Table of Contents, Headings, etc....................... 92
SIGNATURES
EXHIBIT A - FORM OF NOTE........................................A-1
EXHIBIT B - CERTIFICATE OF TRANSFEROR...........................B-1
EXHIBIT C - FORM OF GUARANTY....................................C-1