EXHIBIT 4.2
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▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
13 1/2% SENIOR SUBORDINATED NOTES DUE 2009
Guaranteed to the extent set forth herein by
SBI HOLDINGS, INC.
SIERRA BIOMEDICAL, INC.
SIERRA BIOMEDICAL SAN DIEGO, INC.
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INDENTURE
Dated as of September 29, 1999
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STATE STREET BANK AND TRUST COMPANY
TRUSTEE
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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)......................................................................7.10
(c)......................................................................N.A.
311(a)...................................................................7.11
(b)......................................................................7.11
(c)......................................................................N.A.
312 (a)..................................................................2.05
(b).....................................................................11.03
(c).....................................................................10.03
313(a)...................................................................7.06
(b)(1)...................................................................N.A.
(b)(2)..................................................................7.06;
7.07
(c).....................................................................7.06;
11.02
(d)......................................................................7.06
314(a)..................................................................11.05
(b)......................................................................N.A.
(c)(1)..................................................................11.04
(c)(2)..................................................................11.04
(c)(3)...................................................................N.A.
(d)......................................................................N.A.
(e).....................................................................11.05
(f)......................................................................N.A.
315 (a)..................................................................7.01
(b).....................................................................7.05;
10.02
(c)......................................................................7.01
(d)......................................................................7.01
(e)......................................................................6.11
316 (a)(last sentence)...................................................2.09
(a)(1)(A)................................................................6.05
(a)(1)(B)................................................................6.04
(a)(2)...................................................................N.A.
(b)......................................................................6.07
(c)......................................................................2.12
317 (a)(1)...............................................................6.08
(a)(2)...................................................................6.09
(b)......................................................................2.04
318 (a).................................................................10.01
(b)......................................................................N.A.
(c).....................................................................10.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
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TABLE OF CONTENTS
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Page
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ARTICLE 1DEFINITIONS AND INCORPORATION BY REFERENCE............................2
Section 1.01 Definitions.............................................2
Section 1.02 Other Definitions......................................22
Section 1.03 Incorporation of TIA Provisions........................23
Section 1.04 Rules of Construction..................................23
ARTICLE 2THE NOTES............................................................24
Section 2.01 Form and Dating........................................24
Section 2.02 Execution and Authentication...........................25
Section 2.03 Registrar and Paying Agent.............................25
Section 2.04 Paying Agent to Hold Money in Trust....................26
Section 2.05 Holder Lists...........................................26
Section 2.06 Transfer and Exchange..................................26
Section 2.07 Replacement Notes......................................38
Section 2.08 Outstanding Notes......................................38
Section 2.09 Treasury Notes.........................................39
Section 2.10 Temporary Notes........................................39
Section 2.11 Cancellation...........................................39
Section 2.12 Defaulted Interest.....................................39
ARTICLE 3REDEMPTION AND PREPAYMENT............................................40
Section 3.01 Notices to Trustee.....................................40
Section 3.02 Selection of Notes to Be Redeemed......................40
Section 3.03 Notice of Redemption...................................40
Section 3.04 Effect of Notice of Redemption.........................41
Section 3.05 Deposit of Redemption Price............................41
Section 3.06 Notes Redeemed in Part.................................41
Section 3.07 Optional Redemption....................................42
Section 3.08 Mandatory Redemption...................................42
Section 3.09 Offer to Purchase by Application of Excess Proceeds....42
ARTICLE 4COVENANTS............................................................44
Section 4.0 Payment of Notes.......................................44
Section 4.02 Maintenance of Office or Agency........................44
Section 4.03 Reports................................................45
Section 4.04 Compliance Certificate.................................45
Section 4.05 Taxes..................................................46
Section 4.06 Stay, Extension and Usury Laws.........................46
Section 4.07 Restricted Payments....................................46
Section 4.08 Dividend and Other Payment Restrictions Affecting
Subsidiaries.........................................50
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Section 4.09 Incurrence of Indebtedness and Issuance of Preferred
Stock................................................51
Section 4.10 Asset Sales............................................53
Section 4.11 Transactions with Affiliates...........................54
Section 4.12 Liens..................................................55
Section 4.13 Corporate Existence....................................55
Section 4.14 Offer to Repurchase Upon Change of Control.............55
Section 4.15 No Senior Subordinated Indebtedness....................56
Section 4.16 Limitation on Sale and Leaseback Transactions..........56
Section 4.17 Additional Note Guarantees.............................57
ARTICLE 5SUCCESSORS...........................................................57
Section 5.01 Merger, Consolidation, or Sale of Assets...............57
Section 5.02 Successor Corporation Substituted......................58
ARTICLE 6DEFAULTS AND REMEDIES................................................58
Section 6.01 Events of Default......................................58
Section 6.02 Acceleration...........................................59
Section 6.03 Other Remedies.........................................60
Section 6.04 Waiver of Past Defaults................................60
Section 6.05 Control by Majority....................................61
Section 6.06 Limitation on Suits....................................61
Section 6.07 Rights of Holders of Notes to Receive Payment..........61
Section 6.08 Collection Suit by Trustee.............................61
Section 6.09 Trustee May File Proofs of Claim.......................62
Section 6.10 Priorities.............................................62
Section 6.11 Undertaking for Costs..................................62
ARTICLE 7TRUSTEE..............................................................63
Section 7.01 Duties of Trustee......................................63
Section 7.02 Rights of Trustee......................................64
Section 7.03 Individual Rights of Trustee...........................65
Section 7.04 Trustee's Disclaimer...................................65
Section 7.05 Notice of Defaults.....................................65
Section 7.06 Reports by Trustee to Holders of the Notes.............65
Section 7.07 Compensation and Indemnity.............................65
Section 7.08 Replacement of Trustee.................................66
Section 7.09 Successor Trustee by Merger, etc.......................67
Section 7.10 Eligibility; Disqualification..........................67
Section 7.11 Preferential Collection of Claims Against Company......67
ARTICLE 8LEGAL DEFEASANCE AND COVENANT DEFEASANCE.............................68
Section 8.01 Option to Effect Legal Defeasance or Covenant
Defeasance...........................................68
Section 8.02 Legal Defeasance and Discharge.........................68
Section 8.03 Covenant Defeasance....................................68
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Section 8.04 Conditions to Legal or Covenant Defeasance.............69
Section 8.05 Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions.............70
Section 8.06 Repayment to Company...................................70
Section 8.07 Reinstatement..........................................71
ARTICLE 9AMENDMENT, SUPPLEMENT AND WAIVER.....................................71
Section 9.01 Without Consent of Holders of Notes....................71
Section 9.02 With Consent of Holders of Notes.......................72
Section 9.03 Compliance with Trust Indenture Act....................73
Section 9.04 Revocation and Effect of Consents......................73
Section 9.05 Notation on or Exchange of Notes.......................73
Section 9.06 Trustee to Sign Amendments, etc........................74
ARTICLE 10SUBORDINATION.......................................................74
Section 10.01 Agreement to Subordinate...............................74
Section 10.02 Certain Definitions....................................74
Section 10.03 Liquidation; Dissolution; Bankruptcy...................75
Section 10.04 Default on Designated Senior Indebtedness..............75
Section 10.05 Acceleration of Securities.............................76
Section 10.06 When Distribution Must Be Paid Over....................76
Section 10.07 Notice by Company......................................76
Section 10.08 Subrogation............................................77
Section 10.09 Relative Rights........................................77
Section 10.10 Subordination May Not Be Impaired by Company...........77
Section 10.11 Distribution or Notice to Representative...............77
Section 10.12 Rights of Trustee and Paying Agent.....................78
Section 10.13 Authorization to Effect Subordination..................78
Section 10.14 No Waiver of Subordination Provisions..................78
Section 10.15 Amendments.............................................78
Section 10.16 Trustee's Compensation not Prejudiced..................79
ARTICLE 11NOTE GUARANTEES.....................................................79
Section 11.01 Guarantee..............................................79
Section 11.02 Subordination of Note Guarantee........................80
Section 11.03 Limitation of Guarantor Liability......................80
Section 11.04 Execution And Delivery Of Note Guarantee...............80
Section 11.05 Guarantors May Consolidate, Etc., On Certain Terms.....81
Section 11.06 Releases Following Sale Of Assets......................81
ARTICLE 12MISCELLANEOUS.......................................................82
Section 12.01 Trust Indenture Act Controls...........................82
Section 12.02 Notices................................................82
Section 12.03 Communication by Holders of Notes with Other Holders
of Notes.............................................83
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Section 12.04 Certificate and Opinion as to Conditions Precedent.....83
Section 12.05 Statements Required in Certificate or Opinion..........83
Section 12.06 Rules by Trustee and Agents............................84
Section 12.07 No Personal Liability of Directors, Officers, Employees
and Stockholders.....................................84
Section 12.08 Governing Law..........................................84
Section 12.09 No Adverse Interpretation of Other Agreements..........84
Section 12.10 Successors.............................................84
Section 12.11 Severability...........................................84
Section 12.12 Counterpart Originals..................................84
Section 12.13 Table of Contents, Headings, etc.......................85
EXHIBITS
Exhibit A1: FORM OF NOTE
Exhibit A2: FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B: FORM OF CERTIFICATE OF TRANSFER
Exhibit C: FORM OF CERTIFICATE OF EXCHANGE
Exhibit D: FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL
ACCREDITED INVESTOR
Exhibit E: FORM OF NOTE GUARANTEE
Exhibit F: FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of September 29, 1999, by and among ▇▇▇▇▇▇▇ River
Laboratories, Inc., a Delaware corporation (the "Company"), the guarantors
listed on the signature pages hereto and State Street Bank and Trust Company,
as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 13 1/2% Senior Subordinated Notes due 2009 (the "Notes"). Interest on the
Notes will accrue at the rate of 13.5% per year; provided that the rate at
which interest accrues will increase to 14.0% per year on August 15, 2000 in
the event that the Ratio of Consolidated Net Debt to Consolidated Cash Flow
for the Company as of June 30, 2000 is equal to or greater than 5.00 to 1.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means the form of the Notes initially sold to QIBs.
"Accounts Receivable Subsidiary" means an Unrestricted Subsidiary of
the Company to which the Company or any of its Restricted Subsidiaries sells
any of its accounts receivable pursuant to a Receivables Facility.
"Acquired Indebtedness" means, with respect to any specified Person,
(1) Indebtedness of any other Person existing at the time that
other Person is merged with or into or became a Subsidiary
of that specified Person, including, without limitation,
Indebtedness incurred in connection with, or in
contemplation of, that other Person merging with or into or
becoming a Subsidiary of that specified Person; and
(2) Indebtedness secured by a Lien encumbering an asset acquired by
that specified Person at the time that asset is acquired by that
specified Person.
"Additional Notes" means Notes (other than the Initial Notes)issued
under this Indenture in accordance with Sections 2.02 and 4.09 hereof, as part
of the same series as the Initial Notes.
"Affiliate" of any specified Person means any other Person which,
directly or indirectly, controls, is controlled by or is under direct or
indirect common control with, that specified Person. For purposes of this
definition, "control," when used with respect to any Person, means the power
to direct the management and policies of that Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedelbank that apply to such
transfer or exchange.
"Asset Sale" means:
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(1) the sale, lease, conveyance, disposition or other transfer
(a "disposition") of any properties, assets or rights
(including, without limitation, by way of a sale and
leaseback); provided that the sale, lease, conveyance or
other disposition of all or substantially all of the assets
of the Company and its Subsidiaries taken as a whole will be
governed by the provisions of Sections 4.14 and/or 5.01 and
not by the provisions of Section 4.10; and
(2) the issuance, sale or transfer by the Company or any of its
Restricted Subsidiaries of Equity Interests of any of the
Company's Restricted Subsidiaries,
in the case of either clause (1) or (2), whether in a single
transaction or a series of related transactions,
(a) that have a fair market value in excess of $5.0 million; or
(b) for net proceeds in excess of $5.0 million.
Notwithstanding the foregoing, the following items shall not be
deemed to be Asset Sales:
(1) dispositions in the ordinary course of business;
(2) a disposition of assets by the Company to a Restricted Subsidiary
or by a Restricted Subsidiary to the Company or to another
Restricted Subsidiary;
(3) a disposition of Equity Interests by a Restricted Subsidiary to
the Company or to another Restricted Subsidiary;
(4) the sale and leaseback of any assets within 90 days of the
acquisition thereof;
(5) foreclosures on assets;
(6) any exchange of like property pursuant to Section 1031 of the
Internal Revenue Code of 1986, as amended, for use in a
Permitted Business;
(7) any sale of Equity Interests in, or Indebtedness or other
securities of, an Unrestricted Subsidiary;
(8) a Permitted Investment or a Restricted Payment that is permitted
by Section 4.07 hereof; and
(9) sales of accounts receivable, or participations therein, in
connection with any Receivables Facility.
"Attributable Indebtedness" in respect of a sale and leaseback
transaction means, at the time of determination, the present value (discounted
at the rate of interest implicit in such transaction, determined in accordance
with GAAP) of the obligation of the lessee for net rental payments during the
remaining term of the lease included in that sale and leaseback transaction,
including any period for which that lease has been extended or may, at the
option of the lessor, be extended.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
3
"Board of Directors" means the Board of Directors of the Company, or
any authorized committee of the Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Expenditure Indebtedness" means Indebtedness incurred by any
Person to finance the purchase or construction or any property or assets
acquired or constructed by that Person which have a useful life of more than
one year so long as:
(1) the purchase or construction price for that property or assets
is included in "addition to property, plant or equipment" in
accordance with GAAP;
(2) the acquisition or construction of that property or assets is
not part of any acquisition of a Person or line of business;
and
(3) that Indebtedness is incurred within 90 days of the
acquisition or completion of construction of that property or
assets.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or
limited); and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means;
(1) Government Securities;
(2) any certificate of deposit maturing not more than 365 days
after the date of acquisition issued by, or demand deposit
or time deposit of, an Eligible Institution or any lender
under the New Credit Facility;
(3) commercial paper maturing not more than 365 days after the
date of acquisition of an issuer (other than an Affiliate of
the Company) with a rating, at the time as of which any
investment therein is made, of "A-3" (or higher) according
to S&P or "P-2" (or higher) according to ▇▇▇▇▇'▇ or carrying
an equivalent rating by a nationally recognized rating
agency if both of the two named rating agencies cease
publishing ratings of investments;
4
(4) any bankers acceptances of money market deposit accounts issued
by an Eligible Institution;
(5) any fund investing exclusively in investments of the types
described in clauses (1) through (4) above; and
(6) in the case of any Subsidiary organized or having its
principal place of business outside the United States,
investments denominated in the currency of the jurisdiction
in which that Subsidiary is organized or has its principal
place of business which are similar to the items specified
in clauses (1) through (5) above, including without
limitation any deposit with a bank that is a lender to any
Restricted Subsidiary.
"Cedelbank" means Cedelbank, a limited liability company (a societe
anonyme) organized under Luxembourg law.
"Change of Control" means the occurrence of any of the following:
(1) the sale, lease, transfer, conveyance or other disposition,
other than by way of merger or consolidation, in one or a
series of related transactions, of all or substantially all
of the assets of the Company and its Subsidiaries, taken as
a whole, to any "person" or "group" (as those terms are used
in Section 13(d) of the Exchange Act), other than the
Principals and their Related Parties;
(2) the adoption of a plan for the liquidation or dissolution of the
Company;
(3) the consummation of any transaction, including, without
limitation, any merger or consolidation, the result of which
is that any "person" or "group" (as those terms are used in
Section 13(d) of the Exchange Act), other than the
Principals and their Related Parties, becomes the
"beneficial owner" (as that term is defined in Rule 13d-3
and Rule 13d-5 under the Exchange Act), directly or
indirectly through one or more intermediaries, of 50% or
more of the voting power of the outstanding voting stock of
the Company; or
(4) the first day on which a majority of the members of the board of
directors of the Company are not Continuing Members.
"Commission" means the Securities and Exchange Commission.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of that Person and its Restricted
Subsidiaries for that period plus, to the extent deducted in computing
Consolidated Net Income,
(1) provision for taxes based on income or profits of that Person and
its Restricted Subsidiaries for that period;
(2) Fixed Charges of that Person for that period;
(3) depreciation, amortization (including amortization of
goodwill and other intangibles) and all other non-cash
charges, but excluding any other non-cash charge to the
extent that it represents an accrual of or reserve for cash
expenses in any future period or amortization
5
of a prepaid cash expense that was paid in a prior period, of
that Person and its Restricted Subsidiaries for that period;
(4) net periodic post-retirement benefits;
(5) other income or expense net as set forth on the face of that
Person's statement of operations;
(6) expenses and charges of the Company related to the
Transactions, including any purchase price adjustment or any
other payments made pursuant to or as contemplated in the
Transaction Agreements or any financial advisory agreements
with ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation and
Transaction Financing, the New Credit Facility and the
application of the proceeds thereof; and
(7) any non-capitalized transaction costs incurred in connection
with actual, proposed or abandoned financings, acquisitions
or divestitures, including, but not limited to, financing
and refinancing fees and costs incurred in connection with
the Transactions and Transaction Financing,
in each case, on a consolidated basis and determined in accordance with GAAP.
Notwithstanding the foregoing, the provision for taxes based on the income or
profile of, the Fixed Charges of, and the depreciation and amortization and
other non-cash charges of, a Restricted Subsidiary of a Person shall be added
to Consolidated Net Income to compute Consolidated Cash Flow only to the
extent (and in the same proportion) that Net Income of such Restricted
Subsidiary was included in calculating the Consolidated Net Income of such
Person.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum of, without duplication,
(1) the interest expense of that Person and its Restricted
Subsidiaries for that period, on a consolidated basis,
determined in accordance with GAAP, including amortization
of original issue discount, non-cash interest payments, the
interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to
Attributable Indebtedness, commissions, discounts and other
fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments, if any,
pursuant to Hedging Obligations; provided that in no event
shall any amortization of deferred financing costs be
included in Consolidated Interest Expense; and
(2) the consolidated capitalized interest of that Person and its
Restricted Subsidiaries for that period, whether paid or
accrued; provided, however, that Receivables Fees shall be
deemed not to constitute Consolidated Interest Expense.
Notwithstanding the foregoing, the Consolidated Interest Expense with
respect to any Restricted Subsidiary that is not a Wholly Owned Restricted
Subsidiary shall be included only to the extent and in the same proportion
that the net income of that Restricted Subsidiary was included in calculating
Consolidated Net Income.
"Consolidated Net Debt" means, with respect to any Person as of any
date of determination, the aggregate principal amount of Indebtedness for
borrowed money of such Person and its Restricted
6
Subsidiaries as of such date, less the aggregate amount of cash and Cash
Equivalents of such Person and its Restricted Subsidiaries, in each case
determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of that Person and its Restricted
Subsidiaries for that period, on a consolidated basis, determined in
accordance with GAAP; provided that
(1) the Net Income (or loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity
method of accounting shall be included only to the extent of
the amount of dividends or distributions paid in cash to the
referent Person or a Restricted Subsidiary thereof;
(2) the Net Income (or loss) of any Restricted Subsidiary other
than a Subsidiary organized or having its principal place of
business outside the United States shall be excluded to the
extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that
Net Income (or loss) is not at the date of determination
permitted without any prior governmental approval (that has
not been obtained) or, directly or indirectly, by operation
of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary;
(3) the Net Income (or loss) of any Person acquired in a pooling of
interests transaction for any period prior to the date of that
acquisition shall be excluded; and
(4) the cumulative effect of a change in accounting principles shall
be excluded.
Continuing Members" means, as of any date of determination, any
member of the Board of Directors who:
(1) was a member of Board of Directors immediately after consummation
of the Recapitalization and the Recapitalization Financing; or
(2) was nominated for election or elected to the Board of
Directors with the approval of, or whose election to the
Board of Directors was ratified by, at least a majority of
the Continuing Members who were members of the Board of
Directors at the time of that nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which
the Trustee may give 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 with the passage of time or the
giving of notice or both would be an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof, in the
form of Exhibit A-1 hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
7
"Depositary" means The Depository Trust Company.
"Designated Noncash Consideration" means the fair market value of
non-cash consideration received by the Company or one of its Restricted
Subsidiaries in connection with an Asset Sale that is so designated as
Designated Noncash Consideration pursuant to an Officers' Certificate, setting
forth the basis of that valuation, executed by the principal executive officer
and the principal financial officer of the Company, less the amount of cash or
Cash Equivalents received in connection with a sale of that Designated Noncash
Consideration.
"Disqualified Stock" means any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible, or for which it is
exchangeable), or upon the happening of any event (other than any event solely
within the control of the issuer thereof), matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, is
exchangeable for Indebtedness (except to the extent exchangeable at the option
of that Person subject to the terms of any debt instrument to which that
Person is a party) or redeemable at the option of the Holder thereof, in whole
or in part, on or prior to the date on which the Notes mature; provided that
any Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase that
Capital Stock upon the occurrence of a Change of Control or an Asset Sale
shall not constitute Disqualified Stock if the terms of that Capital Stock
provide that the Company may not repurchase or redeem any such Capital Stock
pursuant to those provisions unless that repurchase or redemption complies
with Section 4.07 hereof; and provided further that, if that Capital Stock is
issued to any plan for the benefit of employees of the Company or its
Subsidiaries or by any such plan to those employees, that Capital Stock shall
not constitute Disqualified Stock solely because it may be required to be
repurchased by the Company in order to satisfy applicable statutory or
regulatory obligations.
"DLJ Merchant Banking Funds" means DLJ Merchant Banking Partners II,
L.P. and its Affiliates.
"Domestic Subsidiary" means a Subsidiary that is organized under the
laws of the United States or any State, district or territory thereof.
"Eligible Institution" means a commercial banking institution that
has combined capital and surplus not less than $100.0 million or its
equivalent in foreign currency, whose short-term debt is rated "A-3" or higher
according to Standard & Poor's Ratings Group ("S&P") or "P-2" or higher
according to ▇▇▇▇▇'▇ Investor Services, Inc. ("Moody's") or carrying an
equivalent rating by a nationally recognized rating agency if both of the two
named rating agencies cease publishing ratings of investments.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means ▇▇▇▇▇▇ Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer
pursuant to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
8
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the New Credit
Facility) in existence on the date of this Indenture, until those amounts are
repaid.
"Fixed Charges" means, with respect to any Person for any period, the
sum, without duplication, of,
(1) the Consolidated Interest Expense of that Person for that period;
and
(2) all dividend payments on any series of preferred stock of
that Person (other than dividends payable solely in Equity
Interests that are not Disqualified Stock),
in each case, on a consolidated basis and in accordance with GAAP.
Fixed Charge Coverage Ratio" means, with respect to any Person for
any period, the ratio of the Consolidated Cash Flow of that Person for that
period (exclusive of amounts attributable to discontinued operations, as
determined in accordance with GAAP, or operations and businesses disposed of
prior to the Calculation Date) to the Fixed Charges of that Person for that
period (exclusive of amounts attributable to discontinued operations, as
determined in accordance with GAAP, or operations and businesses disposed of
prior to the Calculation Date).
In the event that the referent Person or any of its Subsidiaries
incurs, assumes, guarantees or redeems any Indebtedness (other than revolving
credit borrowings) or issues or redeems preferred stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but prior to the date on which the event for which the calculation
of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the
Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to
that incurrence, assumption, guarantee or redemption of Indebtedness, or that
issuance or redemption of preferred stock and the use of the proceeds
therefrom, as if the same had occurred at the beginning of the applicable
four-quarter reference period.
In addition, for purposes of making the computation referred to
above, the Recapitalization and acquisitions that have been made by the
Company or any of its Subsidiaries, including all mergers or consolidations
and any related financing transactions, during the four-quarter reference
period or subsequent to that reference period and on or prior to the
Calculation Date shall be deemed to have occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for that reference
period shall be calculated to include the Consolidated Cash Flow of the
acquired entities on a pro forma basis after giving effect to cost savings
reasonably expected to be realized in connection with that acquisition, as
determined in good faith by an officer of the Company (regardless of whether
those cost savings could then be reflected in pro forma financial statements
under GAAP, Regulation S-X promulgated by the Commission or any other
regulation or policy of the Commission) and without giving effect to clause
(3) of the proviso set forth in the definition of Consolidated Net Income.
"Foreign Credit Facilities" means any Indebtedness of a Restricted
Subsidiary organized or having its principal place of business outside the
United States. Indebtedness under the Foreign Credit Facilities outstanding on
the date on which the Notes are first issued and authenticated under this
Indenture shall be deemed to have been incurred on that date in reliance on
the first paragraph of Section 4.09 hereof.
"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 Standards Board or in such
9
other statements by such other entity as have been approved by a significant
segment of the accounting profession, which are in effect on the date of this
Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(iv),
2.06(d)(ii) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"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 or reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"Guarantors" means (i) each Restricted Subsidiary of the Company on
the date of this Indenture that is a Domestic Subsidiary and (ii) any other
Subsidiary that executes a Note Guarantee in accordance with the provisions of
this Indenture.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (a) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (b) other
agreements or arrangements designed to protect such Person against
fluctuations in interest rates.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person, any indebtedness of
that Person in respect of borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or banker's acceptances or representing Capital
Lease Obligations or the balance deferred and unpaid of the purchase price of
any property or representing any Hedging Obligations, except any such balance
that constitutes an accrued expense, trade payable or customer contract
advances, if and to the extent any of the foregoing Indebtedness (other than
letters of credit and Hedging Obligations) would appear as a liability upon a
balance sheet of that Person prepared in accordance with GAAP, as well as all
Indebtedness of others secured by a Lien on any asset of that Person (whether
or not that Indebtedness is assumed by that Person) and, to the extent not
otherwise included, the guarantee by that Person of any Indebtedness of any
other Person, provided that Indebtedness shall not include the pledge by the
Company of the Capital Stock of an Unrestricted Subsidiary of the Company to
secure Non-Recourse Debt of that Unrestricted Subsidiary.
The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, (together with any interest thereon
that is more than 30 days past due), in the case of any
Indebtedness that does not require current payments of interest;
and
(2) the principal amount thereof (together with any interest
thereon that is more than 30 days past due), in the case of
any other Indebtedness provided that the principal amount of
any Indebtedness that is denominated in any currency other
than United States dollars shall be the amount thereof, as
determined pursuant to the foregoing provision, converted
into
10
United States dollars at the Spot Rate in effect on the date
that Indebtedness was incurred or, if that indebtedness was
incurred prior to the date of this Indenture, the Spot Rate in
effect on the date of this Indenture.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means the first $150,000,000 aggregate principal
amount of Notes issued under this Indenture on the date hereof.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all investments by
that Person in other Persons, including Affiliates, in the forms of direct or
indirect loans (including guarantees by the referent Person of, and Liens on
any assets of the referent Person securing, Indebtedness or other obligations
of other Persons), advances or capital contributions (excluding commission,
travel and similar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a balance sheet prepared in
accordance with GAAP, provided that an investment by the Company for
consideration consisting of common equity securities of the Company shall not
be deemed to be an Investment other than for purposes of clause (3) of the
definition of "Qualified Proceeds."
If the Company or any Restricted Subsidiary of the Company sells or
otherwise disposes of any Equity Interests of any direct or indirect
Restricted Subsidiary of the Company such that, after giving effect to any
such sale or disposition, that Person is no longer a Subsidiary of the
Company, the Company shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the fair market value of the Equity
Interests of that Restricted Subsidiary not sold or disposed of in an amount
determined as provided in the final paragraph of Section 4.07 hereof.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or the city in which the principal
corporate trust office of the Trustee is located, or at a place of payment,
are authorized by law, regulation or executive order to remain closed. 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 on such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of that asset,
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" means all liquidated damages then owing pursuant
to Section 5 of the Registration Rights Agreement.
11
"Management Loans" means one or more loans by the Company or Parent
to officers and/or directors of the Company and any of its Restricted
Subsidiaries to finance the purchase by such officers and directors of common
stock of Parent or the Company or membership interests in CRL Acquisition LLC;
provided that the aggregate principal amount of all such Management Loans
outstanding at any time shall not exceed $1.5 million.
"Net Income" means, with respect to any Person, the net income (loss)
of that Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however:
(1) any gain (or loss), together with any related provision for taxes
on that gain (or loss), realized in connection with:
(a) any Asset Sale, including, without limitation, dispositions
pursuant to sale and leaseback transactions; or
(b) the extinguishment of any Indebtedness of that Person or
any of its Restricted Subsidiaries; and
(2) any extraordinary or nonrecurring gain (or loss), together with
any related provision for taxes on that extraordinary or
nonrecurring gain (or loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of,
without duplication,
(1) the direct costs relating to that Asset Sale, including,
without limitation, legal, accounting and investment banking
fees, and sales commissions, recording fees, title transfer
fees and appraiser fees and cost of preparation of assets
for sale, and any relocation expenses incurred as a result
thereof;
(2) taxes paid or payable as a result thereof (after taking into
account any available tax credits or deductions and any tax
sharing arrangements);
(3) amounts required to be applied to the repayment of
Indebtedness (other than revolving credit Indebtedness
incurred pursuant to the New Credit Facility) secured by a
Lien on the asset or assets that were the subject of that
Asset Sale; and
(4) any reserve established in accordance with GAAP or any
amount placed in escrow, in either case for adjustment in
respect of the sale price of such asset or assets until such
time as that reserve is reversed or that escrow arrangement
is terminated, in which case Net Proceeds shall include only
the amount of the reserve so reversed or the amount returned
to the Company or its Restricted Subsidiaries from that
escrow arrangement, as the case may be.
"New Credit Facility" means that certain Credit Agreement, dated as
of September 29, 1999 among the Company, certain subsidiaries of the Company
from time to time party thereto as guarantors, various financial institutions
party thereto, and DLJ Capital Funding, Inc., as syndication agent and
administrative agent, including any related notes, guarantees, letters of
credit collateral documents, rate
12
protection or hedging arrangement, instruments and agreements executed in
connection therewith, and, in each case, as amended, modified, renewed,
refunded, replaced or refinanced from time to time, including any agreement:
(1) extending or shortening the maturity of any Indebtedness incurred
thereunder or contemplated thereby;
(2) adding or deleting borrowers or guarantors thereunder;
(3) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder, provided that on the
date that Indebtedness is incurred it would not be
prohibited by clause (i) of Section 4.09 hereof; or
(4) otherwise altering the terms and conditions thereof.
Indebtedness under the New Credit Facility outstanding on the date on
which the Notes are first issued and authenticated under this Indenture shall
be deemed to have been incurred on that date in reliance on the first
paragraph of Section 4.09 hereof.
"Non-Recourse Debt" means Indebtedness,
(1) no default with respect to, which (including any rights that
the holders thereof may have to take enforcement action
against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other
Indebtedness of the Company or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness
or cause the payment thereof to be accelerated or payable
prior to its stated maturity; and
(2) as to which the lenders have been notified in writing that
they will not have any recourse to the stock (other than the
stock of an Unrestricted Subsidiary pledged by the Company
to secure debt of that Unrestricted Subsidiary) or assets of
the Company or any of its Restricted Subsidiaries;
provided that in no event shall Indebtedness of any Unrestricted Subsidiary
fail to be Non-Recourse Debt solely as a result of any default provisions
contained in a guarantee thereof by the Company or any of its Restricted
Subsidiaries if the Company or that Restricted Subsidiary was otherwise
permitted to incur that guarantee pursuant to this Indenture.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Custodian" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"Note Guarantee" means the guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes, executed
pursuant to the provisions of this Indenture.
"Notes" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes shall be treated as a
single class for all purposes under this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
13
"Offering" means the offering of the Units by the Company.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Controller, the Secretary or any Vice-President of such Person or any
other officer designated by the Board of Directors.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Sections 12.04 and 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Sections
12.04 and 12.05 hereof. The counsel may be an employee of or counsel to the
Company, any Subsidiary of the Company or the Trustee.
"Parent" means ▇▇▇▇▇▇▇ River Laboratories Holdings, Inc., the
corporate parent of the Company, or its successors.
"Pari Passu Indebtedness" means Indebtedness of the Company that
ranks pari passu in right of payment to the Notes.
"Participant" means, with respect to the Depositary, Euroclear or
Cedelbank, a Person who has an account with the Depositary, Euroclear or
Cedelbank, respectively (and, with respect to The Depository Trust Company,
shall include Euroclear and Cedelbank).
"Participating Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Permitted Business" means any person engaged, directly or
indirectly, in the animal research or biomedical products and services
business or any business reasonably related, incidental or ancillary thereto.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted Subsidiary of
the Company;
(2) any Investment in cash or Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of the
Company in a Person, if as a result of that Investment,
(a) that Person becomes a Restricted Subsidiary of the Company;
or
(b) that 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 Wholly Owned Restricted Subsidiary of
the Company;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and
in compliance with Section 4.10 hereof;
14
(5) any Investment acquired solely in exchange for Equity Interests
(other than Disqualified Stock) of the Company;
(6) any Investment in a Person engaged in a Permitted Business
(other than an Investment in an Unrestricted Subsidiary)
having an aggregate fair market value, taken together with
all other Investments made pursuant to this clause (6) that
are at that time outstanding, not to exceed 15% of Total
Assets at the time of that Investment (with the fair market
value of each Investment being measured at the time made and
without giving effect to subsequent changes in value);
(7) Investments relating to any special purpose Wholly Owned
Subsidiary of the Company organized in connection with a
Receivables Facility that, in the good faith determination
of the Board of Directors, are necessary or advisable to
effect that Receivables Facility;
(8) the Management Loans or Investments in Parent to fund the
Management Loans; and
(9) Hedging Obligations permitted to be incurred under Section 4.09
hereof.
"Permitted Liens" means:
(1) Liens on property of a Person existing at the time that
Person is merged into or consolidated with the Company or
any Restricted Subsidiary, provided that those Liens were
not incurred in contemplation of that merger or
consolidation and do not secure any property or assets of
the Company or any Restricted Subsidiary other than the
property or assets subject to the Liens prior to that merger
or consolidation;
(2) Liens existing on the date of this Indenture;
(3) Liens securing Indebtedness consisting of Capitalized Lease
Obligations, purchase money Indebtedness, mortgage
financings, industrial revenue bonds or other monetary
obligations, in each case incurred solely for the purpose of
financing all or any part of the purchase price or cost of
construction or installation of assets used in the business
of the Company or its Restricted Subsidiaries, or repairs,
additions or improvements to those assets, provided that:
(a) those Liens secure Indebtedness in an amount not in
excess of the original purchase price or the
original cost of any such assets or repair,
additional or improvement thereto (plus an amount
equal to the reasonable fees and expenses in
connection with the incurrence of that
Indebtedness);
(b) those Liens do not extend to any other assets of
the Company or its Restricted Subsidiaries (and, in
the case of repair, addition or improvements to any
such assets, that Lien extends only to the assets
(and improvements thereto or thereon) repaired,
added to or improved);
(c) the Incurrence of that Indebtedness is permitted by Section
4.09 hereof;" and
(d) those Liens attach within 365 days of that purchase,
construction, installation, repair, addition or improvement;
15
(4) Liens to secure any refinancings, renewals, extensions,
modification or replacements (collectively, "refinancing")
(or successive refinancings), in whole or in part, of any
Indebtedness secured by Liens referred to in the clauses
above so long as that Lien does not extend to any other
property (other than improvements thereto);
(5) Liens securing letters of credit entered into in the ordinary
course of business and consistent with past business practice;
(6) Liens on and pledges of the capital stock of any Unrestricted
Subsidiary securing Non-Recourse Debt of that Unrestricted
Subsidiary;
(7) Liens securing (a) Indebtedness (including all Obligations)
under the New Credit Facility or any Foreign Credit Facility
(b) Hedging Obligations payable to a lender under the New
Credit Facility or an Affiliate thereof or to a Person that
was a lender of Affiliate thereof at the time the contract
was entered into to the extent such Hedging Obligations are
secured by Liens on assets also securing Indebtedness
(including all Obligations) under the New Credit Facility;
and
(8) other Liens securing Indebtedness that is permitted by the
terms of this Indenture to be outstanding having an
aggregate principal amount at any one time outstanding not
to exceed $50.0 million.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued within 60 days after
repayment of, in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund other Indebtedness of the
Company or any of its Restricted Subsidiaries; provided that:
(1) the principal amount (or accreted value, if applicable) of
that Permitted Refinancing Indebtedness does not exceed the
principal amount of (or accreted value, if applicable), plus
premium, if any, and accrued interest on the Indebtedness so
extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of reasonable expenses incurred in
connection therewith);
(2) that Permitted Refinancing Indebtedness has a final maturity
date no earlier than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than
the Weighted Average Life to Maturity of, the Indebtedness
being extended, refinanced, renewed, replaced, defeased or
refunded; and
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of
payment to the Notes, that Permitted Refinancing
Indebtedness is subordinated in right of payment to, the
Notes on terms at least as favorable, taken as a whole, to
the Holders of Notes as those contained in the documentation
governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or agency or political subdivision
thereof (including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business).
"Principals" means the DLJ Merchant Banking Funds.
16
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Public Equity Offering" means:
any issuance of common stock by the Company, other than to
Parent and other than Disqualified Stock; or
any issuance of common stock or preferred stock by Parent,
other than Disqualified Stock.
that is registered pursuant to the Securities Act, other than issuances
registered on Form S-8 and issuances registered on Form S-4, excluding
issuances of common stock pursuant to employee benefit plans of Parent or the
Company or otherwise as compensation to employees of Parent or the Company.
"Qualified Proceeds" means any of the following or any combination of
the following:
(1) cash;
(2) Cash Equivalents;
(3) assets (other than Investments) that are used or useful in a
Permitted Business; and
(4) the Capital Stock of any Person engaged in a Permitted
Business if, in connection with the receipt by the Company
or any Restricted Subsidiary of the Company of that Capital
Stock,
(a) that Person becomes a Restricted Subsidiary of the Company
or any Restricted Subsidiary of the Company; or
(b) that 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 any Restricted Subsidiary of the
Company.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Ratio of Consolidated Net Debt to Consolidated Cash Flow" means,
with respect to any Person as of any date of determination, the ratio of (x)
the Consolidated Net Debt of such Person as of such date of determination
(exclusive of amounts attributable to discontinued operations, as determined
in accordance with GAAP, or operations and businesses disposed of prior to the
date of determination) to (y) the Consolidated Cash Flow of such Person for
the four full fiscal quarters ending on or immediately preceding such date of
determination (exclusive of amounts attributable to discontinued operations,
as determined in accordance with GAAP, or operations and businesses disposed
of prior to the date of determination).
In the event that the referent Person or any of its Subsidiaries
incurs, assumes, guarantees or redeems any Indebtedness (other than revolving
credit borrowings) or issues or redeems preferred stock subsequent to the
commencement of the period for which the Ratio of Consolidated Net Debt to
Consolidated Cash Flow is being calculated but prior to the date of
determination, then the Ratio of Consolidated Net Debt to Consolidated Cash
Flow shall be calculated giving pro forma effect to that incurrence,
assumption, guarantee or redemption of Indebtedness, or that
17
issuance or redemption of preferred stock and the use of the proceeds therefrom,
as if the same had occurred at the beginning of the applicable four-quarter
reference period.
In addition, for purposes of making the computation referred to
above, the Recapitalization and acquisitions that have been made by ▇▇▇▇▇▇▇
River or any of its Subsidiaries, including all mergers or consolidations and
any related financing transactions, during the four-quarter reference period
shall be deemed to have occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow of the acquired entities on a pro
forma basis after giving effect to cost savings reasonably expected to be
realized in connection with that acquisition, as determined in good faith by
an officer of ▇▇▇▇▇▇▇ River (regardless of whether those cost savings could
then be reflected in pro forma financial statements under GAAP, Regulation S-X
promulgated by the SEC or any other regulation or policy of the SEC) and
without giving effect to clause (3) of the proviso set forth in the definition
of Consolidated Net Income.
"Recapitalization" means the recapitalization of the Company by the
Principals and their Related Parties pursuant to the terms of the
Recapitalization Agreement.
"Recapitalization Agreement" means that certain Recapitalization
Agreement dated as of July 25, 1999 among the Company, Bausch & Lomb
Incorporated, Parent, ▇▇▇▇▇▇▇ River SPAFAS, Inc., Bausch & Lomb International,
Inc., Wilmington Partners, L.P., Bausch & Lomb Canada, Inc., CRL Acquisition
LLC and DLJ Merchant Banking Partners II, L.P.
"Receivables Facility" means one or more receivables financing
facilities, as amended from time to time, pursuant to which the Company or any
of its Restricted Subsidiaries sells its accounts receivable to an Accounts
Receivable Subsidiary.
"Receivables Fees" means distributions or payments made directly or
by means of discounts with respect to any participation interests issued or
sold in connection with, and other fees paid to a Person that is not a
Restricted Subsidiary in connection with, any Receivables Facility.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of September 29, 1999, by and among the Company and the
other parties named on the signature pages thereof, as such agreement may be
amended, modified or supplemented from time to time, and, with respect to any
Additional Notes, one or more registration rights agreements between the
Company and the other parties thereto, as such agreement(s) may be amended,
modified or supplemented from time to time, relating to rights given by the
Company to the purchasers of Additional Notes to register such Additional
Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global Note in
the form of Exhibit A-1 hereto bearing the Global Note Legend and the Private
Placement Legend, if applicable, and deposited with or on behalf of and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Regulation S
Temporary Global Note upon expiration of the Restricted Period.
18
"Regulation S Temporary Global Note" means a temporary global Note in
the form of Exhibit A-2 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes initially sold in reliance on Rule
903 of Regulation S.
"Related Party" means, with respect to any Principal,
(1) any controlling stockholder or partner of that Principal on the
date of this Indenture; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Person
beneficially holding (directly or through one or more
Subsidiaries) a 51% or more controlling interest of which
consist of the Principals and/or such other Persons referred
to in the immediately preceding clauses (1) or (2).
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (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
above 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 Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period
as defined in Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Guarantees" means the Guarantees by the Guarantors of
Obligations under the New Credit Facility.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"Sierra Acquisition" means the acquisition of SBI Holdings, Inc.
by the Company pursuant to the terms of the Sierra Acquisition Agreement.
19
"Sierra Acquisition Agreement" means Stock Purchase Agreement among
the Company and SBI Holdings, Inc. and its stockholders dated September 3, 1999.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as that Regulation is in effect on
the date hereof.
"Spot Rate" means, for any currency, the spot rate at which such
currency is offered for sale against United States dollars as determined by
reference to the New York foreign exchange selling rates, as published in The
Wall Street Journal on that date of determination for the immediately
preceding business day or, if that rate is not available, as determined in any
publicly available source of similar market data.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which that payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the
date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person,
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of
Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or
more of the other Subsidiaries of that Person (or a
combination thereof); and
(2) any partnership or limited liability company,
(a) the sole general partner or the managing general
partner or managing member of which is that Person
or a Subsidiary of that Person; or
(b) the only general partners or managing members of
which are that Person or of one or more
Subsidiaries of that Person (or any combination
thereof).
"Tax Sharing Agreement" means any tax sharing agreement or
arrangement between the Company and Parent, as the same may be amended from
time to time; provided that in no event shall the amount permitted to be paid
pursuant to all such agreements and/or arrangements exceed the amount the
Company would be required to pay for income taxes were it to file a
consolidated tax return for itself and its consolidated Restricted
Subsidiaries as if it were a corporation that was a parent of a consolidated
group.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.ss.ss.77aaa-
77bbbb) as in effect on the date on which this Indenture is qualified under the
TIA.
"Total Assets" means the total consolidated assets of the Company and
its Restricted Subsidiaries, as shown on the most recent balance sheet
(excluding the footnotes thereto) of the Company.
"Transactions" means the Recapitalization and the Sierra Acquisition.
20
"Transaction Agreements" means the Recapitalization Agreement and the
Sierra Acquisition Agreement.
"Transaction Financing" means;
(1) the issuance and sale by Parent of senior discount debentures
with warrants and senior subordinated discount note for
consideration
(2) the issuance and sale by the Company of the Notes; and
(3) the execution and delivery by the Company and certain of its
subsidiaries of the New Credit Facility and the borrowing of
loans, if any, and issuance of letters of credit thereunder
to fund the Transactions and any related transactions,
including without limitation, the payment of fees and
expenses and the refinancing of outstanding indebtedness of
the Company and its subsidiaries;
the proceeds of each of which were used to fund the purchase price for the
Recapitalization and related fees and expenses.
"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 Global Note" means a permanent global Note in the form
of Exhibit A-1 attached hereto that bears the Global Note Legend and that has
the "Schedule of Exchanges of Interests in the Global Note" attached thereto,
and that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes
that do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary that is designated by
the Board of Directors as an Unrestricted Subsidiary pursuant to a board
resolution, but only to the extent that Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary
of the Company unless the terms of any such agreement,
contract, arrangement or understanding are no less favorable
to the Company or that Restricted Subsidiary than those that
might be obtained at the time from Persons who are not
Affiliates of the Company;
(3) is a Person with respect to which neither the Company nor any of
its Restricted Subsidiaries has any direct or indirect
obligation,
(a) to subscribe for additional Equity Interests (other than
Investments described in clause (7) of the definition of
Permitted Investments); or
(b) to maintain or preserve that Person's financial
condition or to cause that Person to achieve any
specified levels of operating results; and
21
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries.
Any such designation by the board of directors shall be evidenced to
the Trustee by filing with the Trustee a certified copy of the board
resolution giving effect to that designation and an Officers' Certificate
certifying that designation complied with the foregoing conditions and was
permitted by Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary
would fail to meet the foregoing requirements as a Unrestricted Subsidiary, it
shall thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of that Subsidiary shall be deemed to be
incurred by a Restricted Subsidiary of the Company as of that date (and, if
that Indebtedness is not permitted to be incurred as of that date under
Section 4.09 hereof, the Company shall be in default of that covenant).
The Board of Directors may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that the designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of
the Company of any outstanding Indebtedness of that Unrestricted Subsidiary
and that designation shall only be permitted if:
(1) that Indebtedness is permitted under Section 4.09 hereof; and
(2) no Default or Event of Default would be in existence following
that designation.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying,
(a) 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
(b) the number of years (calculated to the nearest
one-twelfth) that will elapse between that date and
the making of that payment; by
(2) the then outstanding principal amount of that Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of that Person all the outstanding Capital Stock or other ownership
interests of which (other than directors' qualifying shares) shall at the time
be owned by that Person or by one or more Wholly Owned Restricted Subsidiaries
of that Person or by that Person and one or more Wholly Owned Restricted
Subsidiaries of that Person.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of that
Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
that Person or by one or more Wholly Owned Subsidiaries of that Person.
Section 1.02 Other Definitions.
Defined in
Term Section
22
"Affiliate Transaction".....................................4.11
"Asset Sale"................................................4.10
"Asset Sale Offer"..........................................3.09
"Authentication Order"......................................2.02
"Bankruptcy Law"............................................4.01
"Change of Control Offer"...................................4.15
"Change of Control Payment".................................4.15
"Change of Control Payment Date" ...........................4.15
"Covenant Defeasance".......................................8.03
"Designated Senior Indebtedness"...........................10.02
"Event of Default"..........................................6.01
"Excess Proceeds"...........................................4.10
"incur".....................................................4.09
"Legal Defeasance" .........................................8.02
"Offer Amount"..............................................3.09
"Offer Period"..............................................3.09
"Paying Agent"..............................................2.03
"Permitted Indebtedness"....................................4.09
"Permitted Junior Securities"..............................10.02
"Purchase Date".............................................3.09
"Registrar".................................................2.03
"Representative"...........................................10.02
"Restricted Payments".......................................4.07
"Senior Indebtedness"......................................10.02
Section 1.03 Incorporation of TIA Provisions.
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; and
"obligor" on the Notes means the Company 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 1.04 Rules of Construction.
Unless the context otherwise requires:
23
(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;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the Commission from time to time.
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions
of this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) Global Notes. Notes issued in global form shall be substantially in
the form of Exhibit A-1 attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Notes issued in definitive form shall be substantially in
the form of Exhibit A-1 attached hereto (but without the Global Note Legend
thereon and without the "Schedule of Exchanges of Interests in the Global
Note" attached thereto). Each Global Note shall represent such of the
outstanding Notes as shall be specified therein and each shall provide that it
shall represent the aggregate principal amount of outstanding Notes from time
to time endorsed thereon and that the aggregate principal 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 a Global Note to reflect the amount of any increase or decrease
in the aggregate principal amount of outstanding Notes represented thereby
shall be made by the Trustee or the Note Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of Exhibit A-2 attached
hereto, which shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Cedelbank, duly executed by the
24
Company and authenticated by the Trustee as hereinafter provided. The
Restricted Period shall be terminated upon the receipt by the Trustee of (i) a
written certificate from the Depositary, together with copies of certificates
from Euroclear and Cedelbank certifying that they have received certification
of non-United States beneficial ownership of 100% of the aggregate principal
amount of the Regulation S Temporary Global Note (except to the extent of any
beneficial owners thereof who acquired an interest therein during the
Restricted Period pursuant to another exemption from registration under the
Securities Act and who will take delivery of a beneficial ownership interest
in a 144A Global Note, all as contemplated by Section 2.06 (a) (ii) hereof),
and (ii) an Officers' Certificate from the Company. Following the termination
of the Restricted Period, beneficial interests in the Regulation S Temporary
Global Note shall be exchanged for beneficial interests in Regulation S
Permanent Global Notes pursuant to the Applicable Procedures. Simultaneously
with the authentication of Regulation S Permanent Global Notes, the Trustee
shall cancel the Regulation S Temporary Global Note. The aggregate principal
amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.
(d) Euroclear and Cedelbank Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Cedelbank" and "Customer Handbook" of Cedelbank shall be applicable to
transfers of beneficial interests in the Regulation S Temporary Global Note
and the Regulation S Permanent Global Notes that are held by Participants
through Euroclear or Cedelbank.
Section 2.02 Execution and Authentication.
One Officer 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 a 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 shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by one
Officer (an "Authentication Order"), authenticate Notes for original issue up
to the aggregate principal amount stated in paragraph 4 of the Notes, plus
Additional Notes issued pursuant to this Section 2.02 and Section 4.09 hereof.
The aggregate principal amount of Notes outstanding at any time may not exceed
such amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or
an Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("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
25
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company shall notify the Trustee in writing
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.
The Company initially appoints The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar
and Paying Agent and to act as Note Custodian with respect to the Global
Notes.
Section 2.04 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 will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes,
and will 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) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as Paying
Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
Section 2.05 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 of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, the Depositary or any such nominee to a successor
Depositary or a nominee of such successor Depositary. All Global Notes will be
exchanged by the Company for Definitive Notes if (i) the Company delivers to
the Trustee notice from the Depositary that it is unwilling or unable to
continue to act as Depositary or that it is no longer a clearing agency
registered under the Exchange Act and, in either case, a successor Depositary
is not appointed by the Company within 90 days after the date of such notice
from the Depositary, (ii) the Company in its sole discretion determines that
the Global Notes (in whole but not in part) should be exchanged for Definitive
Notes and delivers a written notice to such effect to the Trustee or (iii)
there shall have occurred and be continuing to occur a Default or Event of
Default with respect to the Notes; provided that in no event shall the
Regulation S Temporary Global Note be exchanged by the Company for Definitive
Notes prior to (x) the expiration of the Restricted Period and (y) the receipt
by the Registrar of any certificates required
26
pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act. Upon the
occurrence of any of the preceding events in (i), (ii) or (iii) above,
Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. In addition, beneficial interests in a Global Note may
be exchanged for certificated Notes upon request but only upon at least 20
days' prior written notice given to the Trustee by or on behalf of DTC in
accordance with customary procedures. Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof.
Every Note authenticated and delivered in exchange for, or in lieu of, a
Global Note or any portion thereof, pursuant to this Section 2.06 or Section
2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and
shall be, a Global Note, except as provided in this Section 2.06. A Global
Note may not be exchanged for another Note other than as provided in this
Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well
as one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of
a beneficial interest in the same Restricted Global Note in
accordance with the transfer restrictions set forth in the
Private Placement Legend; provided, however, that prior to the
expiration of the Restricted Period, a beneficial interest in
the Regulation S Temporary Global Note may be transferred to a
person who takes delivery in the form of an interest in the
corresponding 144A Global Note only upon receipt by the Trustee
of a written certification from the transferor to the effect
that such transfer is being made (i)(a) to a person whom the
transferor reasonably believes is a QIB in a transaction
meeting the requirements of Rule 144A or (b) pursuant to
another exemption from the registration requirements under the
Securities Act which is accompanied by an opinion of counsel
regarding the availability of such exemption and (ii) in
accordance with all applicable securities laws of any state of
the United States or any other jurisdiction. Beneficial
interests in any Unrestricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar
to effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i)
above, the transferor of such beneficial interest must deliver
to the Registrar either (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary
in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable Procedures
containing information regarding the Participant account to be
credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary
in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an amount
equal to the beneficial interest to be transferred or exchanged
and (2) instructions given by the Depositary to the ▇▇▇▇▇▇▇▇▇
▇▇
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above; provided that in no event
shall Definitive Notes be issued upon the transfer or exchange
of beneficial interests in the Regulation S Temporary Global
Note prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates required
pursuant to Rule 903 under the Securities Act. Upon
consummation of an Exchange Offer by the Company in accordance
with Section 2.06(f) hereof, the requirements of this Section
2.06(b)(ii) shall be deemed to have been satisfied upon receipt
by the Registrar of the instructions contained in the Letter of
Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. Upon satisfaction of
all of the requirements for transfer or exchange of beneficial
interests in Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities Act, the
Trustee shall adjust the principal amount of the relevant
Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof
in the form of a beneficial interest in another Restricted
Global Note if the transfer complies with the requirements of
Section 2.06(b)(ii) above and the Registrar receives the
following:
(A) if the transferee will take delivery in the form
of a beneficial interest in the 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications in item (1) thereof;
and
(B) if the transferee will take delivery in the form of
a beneficial interest in the Regulation S Temporary Global
Note or the Regulation S Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof and, if the
transfer occurs prior to the expiration of the Restricted
Period, the interest transferred shall be held immediately
thereafter through Euroclear or Cedelbank.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may
be exchanged by any holder thereof for a beneficial interest in
an Unrestricted Global Note or transferred to a Person who
takes delivery thereof in the form of a beneficial interest in
an Unrestricted Global Note if the exchange or transfer
complies with the requirements of Section 2.06(b)(ii) above
and:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of the beneficial interest
to be transferred, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is
an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
28
(C) such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof,
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial
interest in a Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note or to
transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Restricted Definitive Note,
then, upon receipt by the Registrar of the following
documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred
to a QIB in accordance with Rule 144A under the Securities
Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (1) thereof;
29
(C) if such beneficial interest is being transferred
to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities
Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set
forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
(F) if such beneficial interest is being transferred
to the Company or any of its Subsidiaries, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item
(3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c) shall be registered in
such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall
instruct the Registrar through instructions from the Depositary and
the Participant or Indirect Participant. The Trustee shall deliver
such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof,
a beneficial interest in the Regulation S Temporary Global Note
may not be exchanged for a Definitive Note or transferred to a
Person who takes delivery thereof in the form of a Definitive
Note prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates required
pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act,
except in the case of a transfer pursuant to an exemption from
the registration requirements of the Securities Act other than
Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial
interest in a Restricted Global Note may exchange such
beneficial interest for an Unrestricted Definitive Note or may
transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note
only if:
30
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of such beneficial
interest, in the case of an exchange, or the transferee,
in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (1) a broker-dealer,
(2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such
beneficial interest for a Definitive Note that does
not bear the Private Placement Legend, a certificate
from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(b) thereof;
or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take
delivery thereof in the form of a Definitive Note
that does not bear the Private Placement Legend, a
certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof,
(E) and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect
that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with
the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial
interest in an Unrestricted Global Note proposes to exchange
such beneficial interest for a Definitive Note or to transfer
such beneficial interest to a Person who takes delivery thereof
in the form of a Definitive Note, then, upon satisfaction of
the conditions set forth in Section 2.06(b)(ii) hereof, the
Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to
Section 2.06(h) hereof, and the Company shall execute and the
Trustee shall authenticate and deliver to the Person designated
in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iii) shall
be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from
the Depositary and the Participant or Indirect Participant. The
Trustee shall deliver such Definitive Notes to the Persons in
whose names such Notes are so registered. Any Definitive Note
issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall not bear the Private Placement
Legend.
31
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted
Definitive Note proposes to exchange such Note for a beneficial
interest in a Restricted Global Note or to transfer such
Restricted Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in
a Restricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications
in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or Rule 904 under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration
requirements of the Securities Act other than those listed
in subparagraphs (B) through (D) above, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration
statement under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount of, in the case
of clause (A) above, the appropriate Restricted Global Note, in the
case of clause (B) above, the 144A Global Note, and in the case of
clause (c) above, the Regulation S Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive
Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Restricted Definitive
Note to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note only if:
32
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it
is not (1) a broker-dealer, (2) a Person participating in
the distribution of the Exchange Notes or (3) a Person who
is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(c)
thereof; or
(2) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof,
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive
Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests
in Unrestricted Global Notes. A Holder of an Unrestricted
Definitive Note may exchange such Note for a beneficial
interest in an Unrestricted Global Note or transfer such
Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note at
any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global
Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication Order
in accordance with Section 2.02 hereof, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Definitive Notes so transferred.
33
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of
transfer or exchange, the requesting Holder shall present or surrender to the
Registrar the Definitive Notes 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. In addition, the
requesting Holder shall provide any additional certifications, documents and
information, as applicable, required pursuant to the following provisions of
this Section 2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes.
Any Restricted Definitive Note may be transferred to and registered
in the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A
under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(ii) estricted Definitive Notes to Unrestricted Definitive Notes.
Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a
Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution
of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement;
or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such
34
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(2) f the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder
thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons
that certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the
Exchange Notes and (z) they are not affiliates (as defined in Rule 144) of the
Company, and accepted for exchange in the Exchange Offer and (ii) Definitive
Notes in an aggregate principal amount equal to the principal amount of the
Restricted Definitive Notes accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of
Definitive Notes so accepted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS, EXCEPT AS SET FORTH IN
THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL
INTEREST HEREIN,
35
THE HOLDER: (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"),
(B) IT HAS ACQUIRED THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT OR (C) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A) (1),
(2), (3) OR (7) OR REGULATION D UNDER THE SECURITIES ACT (AN "IAI")),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS NOTE
EXCEPT (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR RULE 904 OF REGULATION S OF THE
SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (E) TO AN IAI THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE
(THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH
TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS
THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN,
THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION
OF THE FOREGOING."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv),
(c)(iii), c(iv), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to
this Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE
TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE
TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION
2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE
DELIVERED TO THE
36
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF ▇▇▇▇▇▇▇
RIVER LABORATORIES, INC."
(iii) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note shall bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL
NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE
FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS
DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF
THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO
RECEIVE PAYMENT OF INTEREST HEREON."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11
hereof. At any time prior to such cancellation, if any beneficial interest in
a Global Note is exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note
or for Definitive Notes, the 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 or by the Depositary at the direction of the
Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
shall be increased accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Notes
and Definitive Notes upon the Company's order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note 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 or transfer pursuant to Sections 3.06, 3.09, 4.10 and 4.14
hereof).
(iii) The Registrar shall not be required to register the transfer
of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
37
(v) The Company shall not be required (A) to issue, to register
the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of
Notes for redemption under Section 3.02 hereof and ending at the
close of business on the day of selection, (B) to register the
transfer of or to exchange any Note so selected for redemption in
whole or in part, except the unredeemed portion of any Note being
redeemed in part or (c) to register the transfer of or to exchange a
Note between a record date and the next succeeding Interest Payment
Date.
(vi) 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 Note is registered as the absolute
owner of such Note for the purpose of receiving payment of principal
of and interest and Liquidated Damages, if any, on such Notes and for
all other purposes, and none of the Trustee, any Agent or the Company
shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this
Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee, upon receipt of
an Authentication Order, shall authenticate a replacement Note if the
Trustee's requirements 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 Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may
suffer if a Note is replaced. The Company may charge for its expenses in
replacing a Note.
Every replacement Note is an additional 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 2.08 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. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because the Company or an Affiliate of
the Company holds the Note; however, Notes held by the Company or a Subsidiary
of the Company shall not be deemed to be outstanding for purposes of Section
3.07 hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
38
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09 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 by any Person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company, shall be
considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall
prepare and the Trustee shall, as soon as practicable upon receipt of the
written order of the Company signed by an Officer of the Company, authenticate
definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
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 destroy cancelled Notes (subject to the record retention requirement of
the Exchange Act). Certification of the destruction of all cancelled Notes
shall be delivered to the Company. The Company may not issue new Notes to
replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
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, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each
Note and the date of the proposed payment. The Company shall fix or cause to
be fixed each such special record date and payment date, provided that no such
special record date shall be less than 10 days prior to the related payment
date for such defaulted interest. At least 15 days before the special record
date, the Company (or, upon the written request of the Company, the Trustee in
the name and at the expense of the Company) shall mail or cause to be mailed
to Holders a notice that states the special record date, the related payment
date and the amount of such interest to be paid.
39
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 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 this Indenture 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 3.02 Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed at any time,
selection of Notes for redemption will be made by the Trustee 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, on a pro
rata basis, by lot or by another method as the Trustee shall deem fair and
appropriate; provided that no Notes of $1,000 or less shall be redeemed in
part.
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;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, notices of
redemption shall be mailed by first class mail at least 30 but not more than
60 days before the redemption date to each Holder of Notes to be redeemed at
its registered address. If any Note is to be redeemed in part only, the notice
of redemption that relates to that Note shall state the portion of the
principal amount thereof to be redeemed. A new Note in principal amount equal
to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Note. Notes called for redemption
become due on the date fixed for redemption. On and after the redemption date,
interest ceases to accrue on Notes or portions of them called for redemption.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
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(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that
the Company shall have delivered to the Trustee, at least 45 days 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 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
Section 3.05 Deposit of Redemption Price.
One Business Day prior to the redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money 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 promptly 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.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is
redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest shall be paid to
the Person in whose name such Note was registered at the close of business on
such record date. If any Note called for redemption shall not be so 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 and Liquidated Damages, if any, not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
Section 3.06 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, 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.
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Section 3.07 Optional Redemption.
(a) Except as provided below, the Notes will not be redeemable at the
Company's option prior to October 1, 2004. Thereafter, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 nor more than 60 days' notice, in cash at the
redemption prices (expressed as percentages of principal amount) set forth
below, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the applicable redemption date, if redeemed during the twelve-month
period beginning on October 1 of the years indicated below:
Year Percentage
---- ----------
2004......................................................106.750%
2005......................................................104.500%
2006......................................................102.250%
2007 and thereafter.......................................100.000%
Notwithstanding the foregoing, on or prior to October 1, 2002, the
Company may redeem up to 35% of the aggregate principal amount of Notes from
time to time originally issued under this Indenture in cash at a redemption
price of 113.500%% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of one or more Public Equity Offerings; provided that at
least 65% of the aggregate principal amount of Notes from time to time
originally issued under this Indenture remains outstanding immediately after
the occurrence of the redemption; and provided further that the redemption
shall occur within 90 days of the date of the closing of any such Public
Equity Offering.
(b) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
Section 3.08 Mandatory Redemption.
The Company is not required to make mandatory redemption of, or
sinking fund payments with respect to, the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company shall
be required to commence an Asset Sale Offer, it shall follow the procedures
specified below.
The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later
than five Business Days after the termination of the Offer Period (the
"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 hereof (the "Offer Amount")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is
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registered at the close of business on such record date, and no additional
interest shall be payable to Holders who tender Notes pursuant to the Asset Sale
Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrete or accrue interest;
(d) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrete or accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may only elect to have all of such Note purchased and may not
elect to have only a portion of such Note purchased;
(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a depositary,
if appointed by the Company, or a Paying Agent at the address specified in the
notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in
accordance with the terms of this Section 3.09. The Company, the
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Depositary or the Paying Agent, as the case may be, shall promptly (but in any
case not later than five days after the Purchase Date) mail or deliver to each
tendering Holder an amount equal to the purchase price of the Notes tendered
by such Holder and accepted by the Company for purchase, and the Company shall
promptly issue a new Note, and the Trustee, upon written request from the
Company shall authenticate and mail or deliver such new Note to such Holder,
in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company shall publicly announce the
results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal of, premium,
if any, and interest on the Notes on the dates and in the manner provided in
the Notes. Interest on the Notes will accrue at the rate of 13.5% per year;
provided that the rate at which interest accrues will increase to 14.0% per
year on August 15, 2000 in the event that the Ratio of Consolidated Net Debt
to Consolidated Cash Flow for the Company as of June 30, 2000 is equal to or
greater than 5.00 to 1. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or a Subsidiary thereof, (i) holds as of 10:00 a.m. Eastern Time on the due
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 and (ii) is not prohibited from paying such money to the
Holders pursuant to the terms of this Indenture or the Notes. The Company
shall pay all Liquidated Damages, if any, in the same manner on the dates and
in the amounts set forth in the Registration Rights Agreement.
The Company shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; and shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments
of interest and Liquidated Damages (without regard to any applicable grace
period) at the same rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
Affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for 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, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of
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New York 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
2.03 hereof.
Section 4.03 Reports.
Whether or not required by the rules and regulations of the
Commission, so long as any Notes are outstanding, the Company will furnish to
the Holders of Notes (a) all quarterly and annual financial information that
would be required to be contained in a filing with the Commission on Forms
10-Q and 10-K if the Company were required to file those Forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and, with respect to the annual information only, a report thereon
by the Company's certified independent accountants; and (b) all current
reports that would be required to be filed with the Commission on Form 8-K if
the Company were required to file those reports, in each case, within the time
periods specified in the Commission's rules and regulations.
In addition, following the consummation of the Exchange Offer
contemplated by the Registration Rights Agreement, whether or not required by
the rules and regulations of the Commission, the Company will file a copy of
all such information and reports referred to in clauses (a) and (b) above with
the Commission for public availability within the time periods specified in
the Commission's rules and regulations (unless the Commission will not accept
such a filing) and make such information available to securities analysts and
prospective investors upon request.
In addition, the Company and the Guarantors have agreed that, for so
long as any Notes remain outstanding, they will furnish to the Holders and to
securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
Section 4.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after the end of
each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal
year have been made under the supervision of the signing Officers with a view
to determining whether the Company have kept, observed, performed and
fulfilled its obligations under this Indenture, and further stating, as to
each such Officer signing such certificate, that to the best of his or her
knowledge the Company 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 of
this Indenture (or, if a Default or Event of Default shall have occurred,
describing all such Defaults or Events of Default of which he or she may have
knowledge and what action the Company is taking or propose to take with
respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of
the principal of or interest or Liquidated Damages, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company 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 4.03(a) above shall be accompanied by
a written statement of the Company's independent public accountants (which
shall be a firm of established national reputation) that in making the
examination necessary for certification of such financial statements, nothing
has come to their attention that would lead them to believe that the Company
has violated any provisions of Article 4 or Article 5 hereof or, if any such
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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) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any
Default or Event of Default, an Officers' Certificate specifying such Default
or Event of Default and what action the Company is taking or proposes to take
with respect thereto.
Section 4.05 Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate
proceedings or where the failure to effect such payment is not adverse in any
material respect to the Holders of the Notes.
Section 4.06 Stay, Extension and Usury Laws.
The Company covenants that (to the extent permitted by law) 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, that may affect the covenants
or the performance of this Indenture; and the Company hereby expressly waives
(to the extent permitted by law) all benefit or advantage of any such law, and
covenants that (to the extent permitted by law) 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.
Section 4.07 Restricted Payments.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, (1) declare or pay any dividend or
make any other payment or distribution on account of the Company's or any of
its Restricted Subsidiaries' Equity Interests other than dividends or
distributions payable in Equity Interests other than Disqualified Stock of the
Company or dividends or distributions payable to the Company or any Wholly
Owned Restricted Subsidiary of the Company; (2) purchase, redeem or otherwise
acquire or retire for value any Equity Interests of the Company or Parent
other than any of those Equity Interests owned by the Company or any
Restricted Subsidiary of the Company; (3) make any principal payment on or
with respect to, or purchase, redeem, defease or otherwise acquire or retire
for value, any Indebtedness of the Company that is subordinated in right of
payment to the Notes, except in accordance with the mandatory redemption or
repayment provisions set forth in the original documentation governing that
Indebtedness (but not pursuant to any mandatory offer to repurchase upon the
occurrence of any event); or (4) make any Restricted Investment (all payments
and other actions set forth in clauses (1) through (4) above being
collectively referred to as "Restricted Payments"), unless, at the time of and
after giving effect to such Restricted Payment:
(i) no Default or Event of Default shall have occurred and
be continuing or would occur as a consequence thereof;
(ii) the Company would, immediately after giving pro forma
effect thereto as if that Restricted Payment had been made at
the beginning of the applicable four-quarter period, have
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been permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in the first paragraph of Section 4.09 hereof; and
(iii) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and
its Restricted Subsidiaries after the date of this Indenture
(excluding Restricted Payments permitted by clauses (a) (to the
extent that the declaration of any dividend referred to therein
reduces amounts available for Restricted Payments pursuant to
this clause (iii)), (b) through (i), (k ) through (o) and (q)
of the next succeeding paragraph), is less than the sum,
without duplication, of (A) 50% of the Consolidated Net Income
of the Company for the period (taken as one accounting period)
commencing June 27, 1999 to the end of the Company's most
recently ended fiscal quarter for which internal financial
statements are available at the time of that Restricted Payment
(or, if Consolidated Net Income for that period is a deficit,
less 100% of the deficit), plus (B) 100% of the Qualified
Proceeds received by the Company on or after the date of this
Indenture from contributions to the Company's capital or from
the issue or sale on or after the date of this Indenture of
Equity Interests of the Company or of Disqualified Stock or
convertible debt securities of the Company to the extent that
they have been converted into those Equity Interests, other
than Equity Interests, Disqualified Stock or convertible debt
securities sold to a Subsidiary of the Company and Disqualified
Stock or convertible debt securities that have been converted
into Disqualified Stock; plus (C) the amount equal to the net
reduction in Investments in Persons after the date of this
Indenture who are not Restricted Subsidiaries (other than
Permitted Investments) resulting from (x) Qualified Proceeds
received as a dividend, repayment of a loan or advance or other
transfer of assets (valued at the fair market value thereof) to
the Company or any Restricted Subsidiary from those Persons;
(y) Qualified Proceeds received upon the sale or liquidation of
those Investments and (z) the redesignation of Unrestricted
Subsidiaries (excluding any increase in the amount available
for Restricted Payments pursuant to clause (j) or (n) below
arising from the redesignation of that Unrestricted Subsidiary)
whose assets are used or useful in, or which is engaged in, one
or more Permitted Business as Restricted Subsidiaries (valued,
proportionate to the Company's equity interest in that
Subsidiary, at the fair market value of the net assets of that
Subsidiary at the time of such redesignation).
The foregoing provisions will not prohibit:
(a) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration, payment would have
complied with the provisions of this Indenture;
(b) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness or Equity Interests of the
Company in exchange for, or out of the net cash proceeds of the substantially
concurrent sale (other than to a Subsidiary of the Company) of other Equity
Interests of the Company (other than any Disqualified Stock), provided that
the amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement, defeasance or other acquisition shall be
excluded from clause (iii)(B) of the preceding paragraph;
(c) the defeasance, redemption, repurchase, retirement or other
acquisition of subordinated Indebtedness of the Company with the net cash
proceeds from an incurrence of, or in exchange for, Permitted Refinancing
Indebtedness;
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(d) the repurchase, redemption or other acquisition or retirement for
value of any Equity Interests of the Company or Parent or CRL Acquisition LLC
held by any member of Parent's, the Company's (or any of its Restricted
Subsidiaries') management pursuant to any management equity subscription
agreement or stock option agreement and any dividend to Parent to fund any
such repurchase, redemption, acquisition or retirement; provided that (i) the
aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests shall not exceed (x) $5.0 million in any calendar year, with
unused amounts in any calendar year being carried over to succeeding calendar
years subject to a maximum (without giving effect to the following clause (y))
of $10.0 million in any calendar year; plus (y) the aggregate net cash
proceeds received by the Company during that calendar year from any reissuance
of Equity Interests by the Company or Parent to members of management of the
Company and its Restricted Subsidiaries; provided that the amount of any such
net cash proceeds that are used to permit an acquisition or retirement for
value pursuant to this clause (d) shall be excluded from clause (iii)(B) of
the preceding paragraph; and (ii) no Default or Event of Default shall have
occurred and be continuing immediately after that transaction;
(e) payments and transactions in connection with the Transactions,
including any purchase price adjustment or any other payments made pursuant to
or contemplated in the Transaction Agreements or any financial advisory
agreements with ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation, the
Transaction Financing, the Offering, the New Credit Facility (including
commitment, syndication and arrangement fees payable thereunder) and the
application of the proceeds thereof, and the payment of fees and expenses with
respect thereto;
(f) the payment of dividends or the making of loans or advances by
the Company to Parent not to exceed $2.5 million in any fiscal year for costs
and expenses incurred by Parent in its capacity as a holding company or for
services rendered by Parent on behalf of the Company;
(g) payments or distributions to Parent pursuant to any Tax Sharing
Agreement;
(h) the payment of dividends by a Restricted Subsidiary on any class
of common stock of that Restricted Subsidiary if (i) that dividend is paid pro
rata to all holders of that class of common stock; and (ii) at least 50.1% of
that class of common stock is held by the Company or one or more of its
Restricted Subsidiaries;
(i) the repurchase of any class of common stock of a Restricted
Subsidiary if (i) that repurchase is made pro rata with respect to that class
of common stock; and (ii) at least 50.1% of that class of common stock is held
by the Company or one or more of its Restricted Subsidiaries;
(j) any other Restricted Investment made in a Permitted Business
which, together with all other Restricted Investments made pursuant to this
clause (j) since the date of this Indenture, does not exceed $5.0 million (in
each case, after giving effect to all subsequent reductions in the amount of
any Restricted Investment made pursuant to this clause (j), either as a result
of (i) the repayment or disposition thereof for cash or (ii) the redesignation
of an Unrestricted Subsidiary as a Restricted Subsidiary (valued,
proportionate to the Company's equity interest in that Subsidiary at the time
of that redesignation) at the fair market value of the net assets of that
Subsidiary at the time of such redesignation), in the case of clause (i) and
(ii), not to exceed the amount of the Restricted Investment previously made
pursuant to this clause (j); provided that no Default or Event of Default
shall have occurred and be continuing immediately after making that Restricted
Investment;
(k) the declaration and payment of dividends to holders of any class
or series of Disqualified Stock of the Company or any Restricted Subsidiary
issued on or after the date of this Indenture in
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accordance with Section 4.09 hereof; provided that no Default or Event of
Default shall have occurred and be continuing immediately after making that
Restricted Payment;
(l) repurchases of Equity Interests deemed to occur upon exercise of
stock options if those Equity Interests represent a portion of the exercise
price of those options;
(m) any other Restricted Payment which, together with all other
Restricted Payments made pursuant to this clause (n) since the date of this
Indenture, does not exceed $5.0 million, in each case, after giving effect to
all subsequent reductions in the amount of any Restricted Investment made
pursuant to this clause (n) either as a result of (i) the repayment or
disposition thereof for cash or (ii) the redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary (valued, proportionate to the Company's
equity interest in that Subsidiary at the time of such redesignation at the
fair market value of the net assets of that Subsidiary at the time of that
redesignation), in the case of clause (i) and (ii), not to exceed the amount
of the Restricted Investment previously made pursuant to this clause (n);
provided that no Default or Event of Default shall have occurred and be
continuing immediately after making that Restricted Payment;
(n) the pledge by the Company of the Capital Stock of an Unrestricted
Subsidiary of the Company to secure Non-Recourse Debt of that Unrestricted
Subsidiary;
(o) the purchase, redemption or other acquisition or retirement for
value of any Equity Interests of any Restricted Subsidiary issued after the
date of this Indenture, provided that the aggregate price paid for any such
repurchased, redeemed, acquired or retired Equity Interests shall not exceed
the sum of (i) the amount of cash and Cash Equivalents received by that
Restricted Subsidiary from the issue or sale thereof; and (ii) any accrued
dividends thereon the payment of which would be permitted pursuant to clause
(k) above;
(p) any Investment in an Unrestricted Subsidiary that is funded by
Qualified Proceeds received by the Company on or after the date of this
Indenture from contributions to the Company's capital or from the issue and
sale on or after the date of this Indenture of Equity Interests of the Company
or of Disqualified Stock or convertible debt securities to the extent they
have been converted into such Equity Interests (other than Equity Interests,
Disqualified Stock or convertible debt securities sold to a Subsidiary of the
Company and other than Disqualified Stock or convertible debt securities that
have been converted into Disqualified Stock) in an amount (measured at the
time such Investment is made and without giving effect to subsequent changes
in value) that does not exceed the amount of such Qualified Proceeds
(excluding any such Qualified Proceeds to the extent utilized to permit a
prior "Restricted Payment" pursuant to clause (iii)(B) of the preceding
paragraph); and
(q) distributions or payments of Receivables Fees.
The Board of Directors may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if that designation would not cause a Default. For
purposes of making that designation, all outstanding Investments by the
Company and its Restricted Subsidiaries (except to the extent repaid in cash)
in the Subsidiary so designated will be deemed to be Restricted Payments at
the time of that designation and will reduce the amount available for
Restricted Payments under the first paragraph of this Section 4.07. All such
outstanding Investments will be deemed to constitute Restricted Investments in
an amount equal to the greater of (i) the net book value of those Investments
at the time of that designation and (ii) the fair market value of those
Investments at the time of that designation. Such designation will only be
permitted if that Restricted Investment would be permitted at that time and if
that Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
49
The amount of (i) all Restricted Payments (other than cash) shall be
the fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment
and (ii) Qualified Proceeds (other than cash) shall be the fair market value
on the date of receipt thereof by the Company of such Qualified Proceeds.
The fair market value of any non-cash Restricted Payment shall be
determined by the Board of Directors whose resolution with respect thereto
shall be delivered to the Trustee.
Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that the
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed.
Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company will not, and will not permit any of its Restricted
Subsidiaries 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 to (a)(i) pay dividends or make any other
distributions to the Company or any of its Restricted Subsidiaries (A) on its
Capital Stock or (B) with respect to any other interest or participation in,
or measured by, its profits; or (ii) pay any Indebtedness owed to the Company
or any of its Restricted Subsidiaries; (b) make loans or advances to the
Company or any of its Restricted Subsidiaries; or (c) transfer any of its
properties or assets to the Company or any of its Restricted Subsidiaries.
However, the foregoing restrictions will not apply to encumbrances or
restrictions existing under or by reason of (a) Existing Indebtedness as in
effect on the date of this Indenture; (b) the New Credit Facility as in effect
as of the date of this Indenture, and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings thereof; (c) this Indenture and the Notes; (d) applicable law and
any applicable rule, regulation or order; (e) any agreement or instrument of a
Person acquired by the Company or any of its Restricted Subsidiaries as in
effect at the time of that acquisition (except to the extent created in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other
than the Person, or the property or assets of the Person, so acquired,
provided that, in the case of Indebtedness, that Indebtedness was permitted by
the terms of this Indenture to be incurred; (f) customary non-assignment
provisions in leases entered into in the ordinary course of business and
consistent with past practices; (g) purchase money obligations for property
acquired in the ordinary course of business that impose restrictions of the
nature described in clause (e) above on the property so acquired; (h)
contracts for the sale of assets, including, without limitation, customary
restrictions with respect to a Subsidiary pursuant to an agreement that has
been entered into for the sale or disposition of all or substantially all of
the Capital Stock or assets of that Subsidiary; (i) Permitted Refinancing
Indebtedness, provided that the restrictions contained in the agreements
governing that Permitted Refinancing Indebtedness are, in the good faith
judgment of the Company's board of directors, not materially less favorable,
taken as a whole, to the Holders of the Notes than those contained in the
agreements governing the Indebtedness being refinanced; (j) secured
Indebtedness otherwise permitted to be incurred pursuant to Sections 4.09 and
4.12 hereof that limit the right of the debtor to dispose of the assets
securing that Indebtedness; (k) restrictions on cash or other deposits or net
worth imposed by customers under contracts entered into in the ordinary course
of business; (l) other Indebtedness or Disqualified Stock of Restricted
Subsidiaries permitted to be incurred subsequent to the Issuance Date pursuant
to the provisions of Section 4.09 hereof; (m) customary provisions in joint
venture agreements and other similar agreements entered into in the ordinary
course of business; and (n) restrictions created in connection with any
Receivables Facility that, in the good faith determination of the board of
directors of the Company, are necessary or advisable to effect that
Receivables Facility.
50
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable, contingently or
otherwise, with respect to (collectively, "incur") any Indebtedness (including
Acquired Indebtedness); the Company will not, and will not permit any of its
Restricted Subsidiaries to, issue any shares of Disqualified Stock; and the
Company will not permit any of its Restricted Subsidiaries to issue any shares
of preferred stock; provided that the Company or any Restricted Subsidiary may
incur Indebtedness, including Acquired Indebtedness, or issue shares of
Disqualified Stock if the Fixed Charge 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 that
additional Indebtedness is incurred or that Disqualified Stock is issued would
have been at least 2.0 to 1 if such four-quarter period ended prior to
September 30, 2002 and 2.25 to 1 thereafter, determined on a consolidated pro
forma basis, including a pro forma application of the net proceeds therefrom,
as if the additional Indebtedness had been incurred, or the Disqualified Stock
had been issued, as the case may be, at the beginning of that four-quarter
period.
The provisions of the first paragraph of this Section 4.09 will not
apply to the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Indebtedness"):
(i) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness under the New Credit Facility and the
Foreign Credit Facilities; provided that the aggregate principal
amount of all Indebtedness (with letters of credit being deemed to
have a principal amount equal to the maximum potential liability of
the Company and those Restricted Subsidiaries thereunder) then
classified as having been incurred in reliance upon this clause (i)
that remains outstanding under the New Credit Facility and the
Foreign Credit Facilities after giving effect to that incurrence does
not exceed an amount equal to $215.0 million;
(ii) the incurrence by the Company and its Restricted
Subsidiaries of Existing Indebtedness;
(iii) the incurrence by the Company of Indebtedness represented
by the Notes and this Indenture and the Note Guarantees;
(iv) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Expenditure
Indebtedness, Capital Lease Obligations or other obligations, in each
case, the proceeeds of which are used solely for the purpose of
financing all or any part of the purchase price or cost of
construction or improvement of property, plant or equipment
(including acquisitions of Capital Stock of a Person that becomes a
Restricted Subsidiary to the extent of the fair market value of the
property, plant or equipment so acquired) used in the business of the
Company or that Restricted Subsidiary, in an aggregate principal
amount (or accreted value, as applicable) not to exceed $20.0 million
outstanding after giving effect to that incurrence;
(v) Indebtedness arising from agreements of the Company or any
Restricted Subsidiary providing for indemnification, adjustment of
purchase price or similar obligations, in each case, incurred or
assumed in connection with the disposition of any business, assets or
a Subsidiary, other than guarantees of Indebtedness incurred by any
Person acquiring all or any portion of such business, assets or
Restricted Subsidiary for the purpose of financing that acquisition;
provided that (A) that Indebtedness is not reflected on the balance
sheet of the Company or any Restricted Subsidiary (contingent
obligations referred to in a footnote or footnotes to financial
51
statements and not otherwise reflected on the balance sheet will not
be deemed to be reflected on that balance sheet for purposes of this
clause (A)) and (B) the maximum assumable liability in respect of
that Indebtedness shall at no time exceed the gross proceeds
including non-cash proceeds (the fair market value of those non-cash
proceeds being measured at the time received and without giving
effect to any subsequent changes in value) actually received by the
Company and/or that Restricted Subsidiary in connection with that
disposition;
(vi) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for,
or the net proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was
permitted by this Indenture to be incurred;
(vii) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the
Company and/or any of its Restricted Subsidiaries; provided that (i)
if the Company is the obligor on that Indebtedness, that Indebtedness
is expressly subordinated to the prior payment in full in cash of all
Obligations with respect to the Notes; and (ii)(A) any subsequent
issuance or transfer of Equity Interests that results in any such
Indebtedness being held by a Person other than the Company or a
Restricted Subsidiary thereof and (B) any sale or other transfer of
any such Indebtedness to a Person that is not either the Company or a
Restricted Subsidiary thereof shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such
Restricted Subsidiary, as the case may be, that was not permitted by
this clause (vii);
(viii) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose
of fixing or hedging; (A) interest rate risk with respect to any
floating rate Indebtedness that is permitted by the terms of this
Indenture to be outstanding; and (B) exchange rate risk with respect
to agreements or Indebtedness of such Person payable denominated in a
currency other than United States dollars, provided that those
agreements do not increase the Indebtedness of the obligor
outstanding at any time other than as a result of fluctuations in
foreign currency exchange rates or interest rates or by reason of
fees, indemnities and compensation payable thereunder;
(ix) the guarantee by the Company or any of its Restricted
Subsidiaries of Indebtedness of the Company or a Restricted
Subsidiary of the Company that was permitted to be incurred by
another provision of this Section 4.09;
(x) obligations in respect of performance and surety bonds and
completion guarantees (including related letters of credit) provided
by the Company or any Restricted Subsidiary in the ordinary course of
business; and
(xi) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal
amount (or accreted value, as applicable) outstanding after giving
effect to that incurrence, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (xi), not to exceed
$30.0 million.
For purposes of determining compliance with this Section 4.09, in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness described in clauses (i) through (xi)
above or is entitled to be incurred pursuant to the first paragraph of this
Section 4.09, the Company shall, in its sole discretion, classify such item of
Indebtedness in any manner that complies
52
with this Section 4.09 and such item of Indebtedness will be treated as having
been incurred pursuant to only one of those clauses or pursuant to the first
paragraph hereof of this Section 4.09. In addition, the Company may, at any
time, change the classification of an item of Indebtedness (or any portion
thereof) to any other clause or to the first paragraph hereof; provided that
the Company would be permitted to incur such item of Indebtedness (or such
portion thereof) pursuant to such other clause or the first paragraph hereof
of this Section 4.09, as the case may be, at the time of reclassification.
Accrual of interest, accretion or amortization of original issue discount will
not be deemed to be an incurrence of Indebtedness for purposes of this Section
4.09.
All Indebtedness under the New Credit Facility and the Foreign Credit
Facilities outstanding on the date on which Notes are first issued and
authenticated under this Indenture shall be deemed to have been incurred on
such date in reliance on the first paragraph of this Section 4.09.
Section 4.10 Asset Sales.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (a) the Company or the
Restricted Subsidiary, as the case may be, receives consideration at the time
of that Asset Sale at least equal to the fair market value (evidenced by a
resolution of the Board of Directors set forth in an Officers' Certificate
delivered to the Trustee) of the assets or Equity Interests issued or sold or
otherwise disposed of; and (b) at least 75% of the consideration therefor
received by the Company or such Restricted Subsidiary is in the form of (i)
cash or Cash Equivalents; or (ii) property or assets that are used or useful
in a Permitted Business, or the Capital Stock of any Person engaged in a
Permitted Business if, as a result of the acquisition by the Company or any
Restricted Subsidiary thereof, such Person becomes a Restricted Subsidiary;
provided that the amount of (x) any liabilities, as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet, of the Company or any
Restricted Subsidiary (other than contingent liabilities and liabilities that
are by their terms subordinated to the Notes or any guarantee thereof) that
are assumed by the transferee of any such assets pursuant to a customary
novation agreement that releases the Company or the Restricted Subsidiary from
further liability; (y) any securities, notes or other obligations received by
the Company or the Restricted Subsidiary from the transferee that are
converted within 180 days of their receipt by the Company or the Restricted
Subsidiary into cash or Cash Equivalents but only to the extent of the cash or
Cash Equivalents received; and (z) any Designated Noncash Consideration
received by the Company or any of its Restricted Subsidiaries in that Asset
Sale having an aggregate fair market value, taken together with all other
Designated Noncash Consideration received pursuant to this clause (z) that is
at that time outstanding, not to exceed 15% of Total Assets at the time of the
receipt of that Designated Noncash Consideration, with the fair market value
of each item of Designated Noncash Consideration being measured at the time
received and without giving effect to subsequent changes in value, shall be
deemed to be cash for purposes of this Section 4.10; and provided further that
the 75% limitation referred to in clause (b) above will not apply to any Asset
Sale in which the cash or Cash Equivalents portion of the consideration
received therefrom, determined in accordance with the foregoing proviso, is
equal to or greater than what the after-tax proceeds would have been had such
Asset Sale complied with the aforementioned 75% limitation.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company or the Restricted Subsidiary, as the case may be, shall
apply such Net Proceeds, at its option (or to the extent the Company is
required to apply such Net Proceeds pursuant to the terms of the New Credit
Facility), to (a) repay or purchase Senior Indebtedness or Pari Passu
Indebtedness of the Company or any Indebtedness of any Restricted Subsidiary,
as the case may be, provided that if the Company shall so repay or purchase
Pari Passu Indebtedness of the Company, (i) it will equally and ratably reduce
Indebtedness under the Notes if the Notes are then redeemable; or, (ii) if the
Notes may not then be redeemed, the Company shall make an
53
offer, in accordance with the procedures set forth below for an Asset Sale
Offer, to all Holders of Notes to purchase at a purchase price equal to 100%
of the principal amount of the Notes, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date of purchase, the Notes that
would otherwise be redeemed; or (b)(i) an investment in property, the making
of a capital expenditure or the acquisition of assets that are used or useful
in a Permitted Business; or (ii) the acquisition of Capital Stock of any
Person primarily engaged in a Permitted Business if (x) as a result of the
acquisition by the Company or any Restricted Subsidiary thereof, that Person
becomes a Restricted Subsidiary; or (y) the Investment in that Capital Stock
is permitted by clause (6) of the definition of Permitted Investments. Pending
the final application of any Net Proceeds, the Company may temporarily reduce
Indebtedness or otherwise invest those Net Proceeds in any manner that is not
prohibited by this Indenture. Any Net Proceeds from Asset Sales that are not
applied or invested as provided in the first sentence of this paragraph will
be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $10.0 million, the Company will be required to make an offer
to all Holders of Notes (an "Asset Sale Offer") to purchase the maximum
principal amount of Notes that may be purchased out of the Excess Proceeds, at
an offer price in cash in an amount equal to 100% of the principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of purchase, in accordance with the procedures set forth
in this Indenture. To the extent that any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use such Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Notes surrendered by Holders thereof in connection with an
Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall
select the Notes to be purchased as set forth under Sections 3.02 and 3.03
hereof. Upon completion of such offer to purchase, the amount of Excess
Proceeds shall be reset at zero.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes pursuant to an Asset Sale Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Indenture relating to such Asset Sale Offer, the Company
will comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations described in this Indenture by
virtue thereof.
Section 4.11 Transactions with Affiliates.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate of the Company (each of the foregoing, an "Affiliate
Transaction"), unless (a) such Affiliate Transaction is on terms that are no
less favorable to the Company or such Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or that
Restricted Subsidiary with an unrelated Person; and (b) the Company delivers
to the Trustee, with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of $7.5
million, either (i) a resolution of the Board of Directors set forth in an
Officers' Certificate certifying that the relevant Affiliate Transaction
complies with clause (a) above and that such Affiliate Transaction has been
approved by a majority of the disinterested members of the Board of Directors;
or (ii) an opinion as to the fairness to the Holders of that Affiliate
Transaction from a financial point of view issued by an accounting, appraisal
or investment banking firm of national standing.
Notwithstanding the foregoing, the following items shall not be
deemed to be Affiliate Transactions: (a) customary directors' fees,
indemnification or similar arrangements or any employment agreement or other
compensation plan or arrangement entered into by the Company or any of its
Restricted
54
Subsidiaries in the ordinary course of business (including ordinary course
loans to employees not to exceed (i) $5.0 million outstanding in the aggregate
at any time and (ii) $2.0 million to any one employee) and consistent with the
past practice of the Company or that Restricted Subsidiary; (b) transactions
between or among the Company and/or its Restricted Subsidiaries; (c) payments
of customary fees by the Company or any of its Restricted Subsidiaries to DLJ
Merchant Banking Funds and their Affiliates made for any financial advisory,
financing, underwriting or placement services or in respect of other
investment banking activities, including, without limitation, in connection
with acquisitions or divestitures which are approved by a majority of the
Board of Directors in good faith; (d) any agreement as in effect on the date
of this Indenture or any amendment thereto (so long as that amendment is not
disadvantageous to the Holders of the Notes in any material respect) or any
transaction contemplated thereby; (e) payments and transactions in connection
with the Transactions, including any purchase price adjustment or any other
payments made pursuant to the Transaction Agreements or any financial advisory
agreements with ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation and the
Transaction Financing, the New Credit Facility (including commitment,
syndication and arrangement fees payable thereunder) and the Offering
(including underwriting discounts and commissions in connection therewith) and
the application of the proceeds thereof, and the payment of the fees and
expenses with respect thereto; (f) Restricted Payments that are permitted by
Section 4.07 hereof and any Permitted Investments; and (g) sales of accounts
receivable, or participations therein, in connection with any Receivables
Facility.
Section 4.12 Liens.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien, other than a Permitted Lien, that secures obligations under
any Pari Passu Indebtedness or subordinated Indebtedness of the Company on any
asset or property now owned or hereafter acquired by the Company or any of its
Restricted Subsidiaries, or any income or profits therefrom or assign or
convey any right to receive income therefrom, unless the Notes are equally and
ratably secured with the obligations so secured until such time as those
obligations are no longer secured by a Lien; provided that, in any case
involving a Lien securing subordinated Indebtedness of the Company, that Lien
is subordinated to the Lien securing the Notes to the same extent that that
subordinated Indebtedness is subordinated to the Notes.
Section 4.13 Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) the
corporate, partnership or other existence of itself and each of its
Subsidiaries, in accordance with the respective organizational documents (as
the same may be amended from time to time) of the Company or any such
Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of itself and any
of its Subsidiaries, if the Board of Directors shall determine 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 of the Notes.
Section 4.14 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of Notes will have
the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the
offer described below (the "Change of Control Offer") at an offer price in
55
cash equal to 101% of the aggregate principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the date of
repurchase (the "Change of Control Payment"). Within 60 days following any
Change of Control, the Company will, or will cause the Trustee to, mail a
notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes on the date
specified in that notice, which date shall be no earlier than 30 days and no
later than 60 days from the date that notice is mailed (the "Change of Control
Payment Date"), pursuant to the procedures required by this Indenture and
described in that notice. The Company will comply with the requirements of
Rule 14e-1 under the Exchange Act and any other securities laws and
regulations thereunder to the extent such laws and regulations are applicable
in connection with the repurchase of the Notes as a result of a Change of
Control. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of this Indenture relating to a
Change of Control Offer, the Company will comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations described in this Indenture by virtue thereof.
(b) On the Change of Control Payment Date, the Company will, to the
extent lawful, (a) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer; (b) 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 (c) deliver or cause to be delivered to
the Trustee the Notes so accepted together with an Officers' Certificate
stating the aggregate principal amount of Notes or portions thereof being
purchased by the Company. The Paying Agent will promptly mail to each Holder
of Notes so tendered the Change of Control Payment for that Holder's Notes,
and the Trustee will promptly authenticate and mail, or cause to be
transferred by book-entry, to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that
each new Note will be in a principal amount of $1,000 or an integral multiple
thereof. Prior to complying with the provisions of this Section 4.14, but in
any event within 90 days following a Change of Control, the Company will
either repay all outstanding Senior Indebtedness or obtain the requisite
consents, if any, under all agreements governing outstanding Senior
Indebtedness to permit the repurchase of Notes required by this Section 4.14.
The Company shall publicly announce the results of the Change of Control Offer
on or as soon as practicable after the Change of Control Payment Date.
(c) Notwithstanding anything to the contrary in this Section 4.14,
the Company will not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set
forth in this Indenture applicable to a Change of Control Offer made by the
Company and purchases all Notes validly tendered and not withdrawn under such
Change of Control Offer.
Section 4.15 No Senior Subordinated Indebtedness.
Notwithstanding the provisions of Section 4.09 hereof, (i) the
Company shall not incur any Indebtedness that is subordinate or junior in
right of payment to any Senior Indebtedness and senior in right of payment to
the Notes, and (ii) no Guarantor will incur any Indebtedness that is
subordinate or junior in right of payment to any Senior Indebtedness and
senior in right of payment to that Guarantor's Note Guarantee.
Section 4.16 Limitation on Sale and Leaseback Transactions.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company or any Restricted Subsidiary may enter into a sale and leaseback
transaction if (a) the Company or such Restricted Subsidiary, as the case may
be, could have (i)
56
incurred Indebtedness in an amount equal to the Attributable Indebtedness
relating to such sale and leaseback transaction pursuant to the Fixed Charge
Coverage Ratio test set forth in the first paragraph of Section 4.09 hereof;
and (ii) incurred a Lien to secure that Indebtedness pursuant to Section 4.12
hereof; (b) the gross cash proceeds of such sale and leaseback transaction are
at least equal to the fair market value (as determined in good faith by the
Board of Directors and set forth in an Officers' Certificate delivered to the
Trustee) of the property that is the subject of that sale and leaseback
transaction; and (c) the transfer of assets in that sale and leaseback
transaction is permitted by, and the Company applies the proceeds of such
transaction in compliance with, Section 4.10 hereof.
Section 4.17 Additional Note Guarantees.
If the Company or any of its Subsidiaries shall acquire or create a
Wholly-Owned Restricted Subsidiary after the date of this Indenture, then such
newly acquired or created a Wholly-Owned Restricted Subsidiary shall execute a
Note Guarantee in the form of a Supplemental Indenture and deliver an Opinion
of Counsel, in accordance with the terms of this Indenture, except for (i) all
Subsidiaries organized outside of the United States and its territories, (ii)
all Subsidiaries that have properly been designated as Unrestricted
Subsidiaries in accordance with this Indenture for so long as they continue to
constitute Unrestricted Subsidiaries and (iii) all Subsidiaries that have not
guaranteed any Indebtedness under the New Credit Facility.
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
The Company may not consolidate or merge with or into (whether or not
the Company is the surviving corporation), or sell, assign, transfer, convey
or otherwise dispose of all or substantially all of its properties or assets
in one or more related transactions to, another Person unless (a) the Company
is the surviving corporation or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which that sale,
assignment, transfer, conveyance or other disposition shall have been made is
a corporation organized or existing under the laws of the United States, any
state thereof or the District of Columbia; (b) the Person formed by or
surviving any such consolidation or merger (if other than the Company) or the
Person to which that sale, assignment, transfer, conveyance or other
disposition shall have been made assumes all the obligations of the Company
under the Registration Rights Agreement, the Notes and this Indenture pursuant
to a supplemental indenture in a form reasonably satisfactory to the Trustee;
(c) immediately after that transaction no Default or Event of Default exists;
and (d) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which that sale,
assignment, transfer, conveyance or other disposition shall have been made (i)
will, at the time of such transaction and after giving pro forma effect
thereto as if that transaction had occurred at the beginning of the applicable
four-quarter period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the
first paragraph of Section 4.09 hereof or (ii) would, together with its
Restricted Subsidiaries, have a higher Fixed Charge Coverage Ratio immediately
after that transaction (after giving pro forma effect thereto as if that
transaction had occurred at the beginning of the applicable four-quarter
period) than the Fixed Charge Coverage Ratio of the Company and its Restricted
Subsidiaries immediately prior to that transaction. The foregoing clause (d)
will not prohibit (i) a merger between the Company and a Wholly Owned
Subsidiary of Parent created for the purpose of holding the Capital Stock of
the Company; (ii) a merger between the Company and a Wholly Owned Restricted
Subsidiary; or (iii) a merger between the Company and an Affiliate
incorporated solely for the purpose of reincorporating the Company in another
State of the United States so long as, in each
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case, the amount of Indebtedness of the Company and its Restricted
Subsidiaries is not increased thereby. The Company will not lease all or
substantially all of its assets to any Person.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the
assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation and not to the Company), and may
exercise every right and power of the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
provided, however, that the predecessor Company shall not be relieved from the
obligation to pay the principal of and interest or Liquidated Damages, if any,
on the Notes except in the case of a sale of all or substantially all of the
Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following constitutes an Event of Default:
(a) default for 30 days in the payment when due of interest on, or
Liquidated Damages with respect to, the Notes (whether or not prohibited by
Article 10 hereof);
(b) default in payment when due of the principal of or premium, if
any, on the Notes (whether or not prohibited by Article 10 hereof);
(c) failure by the Company or any of its Restricted Subsidiaries for
30 days after receipt of notice from the Trustee or Holders of at least 25% in
principal amount of the Notes then outstanding to comply with Sections 4.07,
4.09, 4.10, 4.14 or Article 5 hereof;
(d) failure by the Company for 60 days after notice from the Trustee
or the Holders of at least 25% in principal amount of the Notes then
outstanding to comply with any of its other agreements in this Indenture or
the Notes;
(e) default under 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 of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of
its Restricted Subsidiaries), whether that Indebtedness or guarantee now
exists, or is created after the date of this Indenture, which default (i) is
caused by a failure to pay Indebtedness at its stated final maturity (after
giving effect to any applicable grace period provided in such Indebtedness) (a
"Payment Default") or (ii) results in the acceleration of that Indebtedness
prior to its stated final maturity and, in each case, the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $10.0 million or more;
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(f) failure by the Company or any of its Restricted Subsidiaries to
pay final judgments aggregating in excess of $10.0 million (net of any amounts
with respect to which a reputable and creditworthy insurance company has
acknowledged liability in writing), which judgments are not paid, discharged
or stayed for a period of 60 days;
(g) except as permitted by this Indenture, if any Note Guarantee
shall be held in any judicial proceeding to be unenforceable or invalid or
shall cease for any reason to be in full force and effect or any Guarantor, or
any Person acting on behalf of any Guarantor, shall deny or disaffirm its
obligations under its Note Guarantee;
(h) the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken as
a whole, would constitute a Significant Subsidiary pursuant to or within the
meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become due; or
(i) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group
of Restricted Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries that is
a Significant Subsidiary or any group of Restricted Subsidiaries
that, taken as a whole, would constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group
of Restricted Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02 Acceleration.
If any Event of Default (other than an Event of Default specified in
clause (h) or (i) of Section 6.01 hereof with respect to the Company, any
Restricted Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary) occurs and is continuing, the Holders of at least 25% in principal
amount of the then outstanding Notes
59
may direct the Trustee to declare all the Notes to be due and payable
immediately. However, so long as any Indebtedness permitted to be incurred
pursuant to the New Credit Facility shall be outstanding, such acceleration
shall not be effective until the earlier of (i) an acceleration under any such
Indebtedness under the New Credit Facility; or (ii) five Business Days after
receipt by the Company and the administrative agent under the New Credit
Facility of written notice of such acceleration. Except as stated in the prior
sentence, upon any such declaration, the Notes shall become due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified
in clause (h) or (i) of Section 6.01 hereof occurs with respect to the
Company, any of its Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, all outstanding Notes will become due and
payable without further action or notice. Holders of the Notes may not enforce
this Indenture or the Notes except as provided in this Indenture. The Holders
of a majority in aggregate principal amount of the then outstanding Notes by
written notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with
any judgment or decree and if all existing Events of Default (except
nonpayment of principal, interest or premium or Liquidated Damages, if any,
that has become due solely because of the acceleration) have been cured or
waived, provided that, in the event of a declaration of acceleration of the
Notes because an Event of Default has occurred and is continuing as a result
of the acceleration of any Indebtedness described in clause (e) of Section
6.01 hereof, the declaration of acceleration of the Notes shall be
automatically annulled if the holders of any Indebtedness described in clause
(e) of Section 6.01 hereof have rescinded the declaration of acceleration in
respect of such Indebtedness within 30 days of the date of such declaration
and if (i) the annulment of the acceleration of the Notes would not conflict
with any judgment or decree of a court of competent jurisdiction; and (ii) all
existing Events of Default, except non-payment of principal or interest on the
Notes that became due solely because of the acceleration of the Notes, have
been cured or waived.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest and Liquidated Damages, if any, on the Notes or to enforce
the performance of any provision of the Notes or this Indenture.
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 of a Note 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 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration). 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.
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Section 6.05 Control by Majority.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising 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 of Notes or that may involve
the Trustee in personal liability.
Section 6.06 Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture
or the Notes only if:
(a) the Holder of a Note 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 of a Note or Holders of Notes 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 of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due
dates expressed in the Note (including in connection with an offer to
purchase), 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 such Holder.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) 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 of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest and Liquidated Damages, if any, on overdue
principal 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 6.09 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 of the Notes allowed in any judicial proceedings relative to
the Company (or any other obligor upon the Notes), its creditors or its
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 7.07 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 7.07 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 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, 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 6, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, 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 of Senior Indebtedness to the extent required by
Article 10 or Section 11.02 hereof;
Third: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
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
62
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 of a Note pursuant to Section 6.07 hereof, or
a suit by Holders of more than 10% in principal amount of the then outstanding
Notes.
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.
(a) 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 its exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his own
affairs.
(b) Except during the continuance of an Event of Default:
(i) 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 no others, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture, but need not verify the contents
thereof.
(c) 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:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section 7.01;
(ii) 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; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Sections 6.02, 6.04 or 6.05
hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), (c), (e) and (f) of this Section 7.01 and Section 7.02 hereof.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holder shall have offered to the
Trustee security and indemnity satisfactory to it against any loss, liability
or expense.
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(f) 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.
Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting 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.
(b) 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.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights
or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
(g) Except with respect to Section 4.01 hereof, 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 6.01(a), 6.01(b) and 4.01 or (ii) any Default
or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
(h) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee may, in its discretion, make such further inquiry or investigation
into such facts or matters as it may see fit and if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled
to examine the books, records and premises of the Company personally or by
agent or attorney.
(i) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(j) Delivery of reports, information and documents to the Trustee
under Section 4.03 is for informational purposes only and the Trustee's
receipt of the foregoing shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including
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the Company's compliance with any of the covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
Section 7.03 Individual Rights of Trustee.
The Trustee may become the owner or pledgee of Notes and may
otherwise deal with the Company or any Affiliate of the Company with the same
rights it would have if it were not Trustee. However, in the event that the
Trustee acquires any conflicting interest it must eliminate such conflict
within 90 days, apply to the Commission for permission to continue as trustee
or resign. Any Agent may do the same with like rights and duties. The Trustee
is also subject to Sections 7.10 and 7.11 hereof.
Section 7.04 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 of
this Indenture, 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 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to Holders of Notes a notice
of the Default or Event of Default within 90 days after such Default or Event
of Default becomes known to the Trustee. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest or
Liquidated Damages, if any, on any Note, the Trustee may withhold the notice
if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of
the Notes.
Section 7.06 Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes 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. (b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the Commission and each
stock exchange on which the Notes are listed in accordance with TIA ss.
313(d). The Company shall promptly notify the Trustee when the Notes are
listed on any stock exchange.
Section 7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by
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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.
The Company and any Guarantor shall jointly and severally indemnify
the Trustee and its agents, employees, officers, directors and shareholders
for, and hold the same harmless against, any and all losses, liabilities or
expenses (including without limitation reasonable attorney's fees and
expenses) incurred by it arising out of or in connection with the acceptance
or administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company (including this
Section 7.07) and defending itself against any claim (whether asserted by the
Company or any Holder or any other person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. 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. At the
Trustee's sole discretion, the Company shall defend the claim and the Trustee
shall cooperate in the defense at the Company's expense. 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, which consent shall not be unreasonably withheld.
The obligations of the Company and any Guarantor under this Section
7.07 shall survive the resignation or removal of the Trustee and/or the
satisfaction and discharge or termination of this Indenture.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the resignation or
removal of the Trustee and/or the satisfaction and discharge or termination of
this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
Section 7.08 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 in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Notes of
a majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company
may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(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;
66
(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 Notes 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 of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10 hereof, such Holder of a Note 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 Holders of the Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
Section 7.09 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 is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or
state authorities and that has a combined capital and surplus of at least $100
million as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIAss. 310(a)(1), (2) and (5). The Trustee is subject to TIAss.
310(b).
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.
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ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes and
Note Guarantees upon compliance with the conditions set forth below in this
Article 8.
Section 8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
deemed to have been discharged from its obligations with respect to all
outstanding Notes, Note Guarantees and this Indenture on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance").
For this purpose, Legal Defeasance means that the Company shall be deemed to
have paid and discharged the entire Indebtedness represented by the
outstanding Notes, Note Guarantees and this Indenture, which Notes shall
thereafter be deemed to be "outstanding" only for the purposes of Section 8.05
hereof and the other Sections of this Indenture referred to in (a) and (b)
below, and to have satisfied all its other obligations under such Notes, Note
Guarantees 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 provisions 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 those Notes when those payments are due from the trust
referred to below;
(b) the Company's obligations with respect to the Notes concerning
issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the maintenance of an office or agency for payment and money
for security payments held in trust;
(c) the rights, powers, trusts, duties and immunities of the Trustee,
and the Company's obligations in connection therewith; and
(d) the Legal Defeasance provisions of this Indenture.
Section 8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from its obligations under the covenants contained in Sections 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.14, 4.15, 4.16 and 4.17 hereof with respect to
the outstanding Notes on and after the date the conditions set forth in
Section 8.04 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 (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant
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Defeasance means that, with respect to the outstanding Notes, the Company and
the Guarantors may omit to comply with and shall have no liability in respect
of any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any
such covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall
not constitute a Default or an Event of Default under Section 6.01 hereof,
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 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, Sections 6.01(c) through 6.01(f) hereof shall not constitute Events of
Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes and Note Guarantees:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders of the Notes, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in those 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 the outstanding Notes on the
stated maturity or on the applicable redemption date, as the case may be, and
the Company must specify whether the Notes are being defeased to maturity or
to a particular redemption date;
(b) in the case of Legal Defeasance, the Company shall have delivered
to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that (i) the Company has received from,
or there has been published by, the Internal Revenue Service; a ruling or (ii)
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, subject to customary assumptions
and exclusions, the Holders of the 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;
(c) in the case of Covenant Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that, subject to customary assumptions
and exclusions, the Holders of the 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;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of that deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such deposit)
or, insofar as Events of Default from bankruptcy or insolvency events are
concerned, at any time in the period ending on the 123rd day after the date of
deposit;
(e) that Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any material agreement
or instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
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(f) the Company must have delivered to the Trustee an Opinion of
Counsel to the effect that, subject to customary assumptions and exclusions,
after the 123rd day following the deposit, the trust funds will not be subject
to the effect of Section 547 of the United States Bankruptcy Code or any
analogous New York State law provision or any other applicable federal or New
York bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally;
(g) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company with
the intent of defeating, hindering, delaying or defrauding creditors of the
Company or others; and
(h) the Company must deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel (which opinion may be subject to customary
assumptions and exclusions), each stating that all conditions precedent
provided for relating to the Legal Defeasance or the Covenant Defeasance have
been complied with.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly
or through any Paying Agent (including the Company acting as 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 cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof 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 the
outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 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 8.04(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.
Section 8.06 Repayment to Company.
Any money 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 or Liquidated Damages, if any, on any Note and remaining
unclaimed for two years after such principal, and premium, if any, or interest
or Liquidated Damages, if any, has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Note shall thereafter, as a secured
creditor, look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as
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trustees thereof, 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 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02
or 8.03 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
Indenture, the Notes and the Note Guarantees shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Company makes any payment of principal of,
premium, if any, or interest or Liquidated Damages, if any, on any Note
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 money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the Note
Guarantees or the Notes without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including
the related definitions) in a manner that does not materially adversely affect
any Holder;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Notes by a successor to the Company pursuant to Article 5 or
Article 11 hereof or to provide for the assumption of any Guarantor's
obligations under its Note Guarantee in the case of a merger or consolidation
of the Guarantor;
(d) 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 of any Holder of the Note;
(e) to comply with requirements of the Commission in order to effect
or maintain the qualification of this Indenture under the TIA;
(f) to provide for the issuance of Additional Notes in accordance
with the limitations set forth in this Indenture as of the date hereof; or
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(g) to allow any Guarantor to execute a supplemental indenture and/or
a Note Guarantee with respect to the Notes.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company and
the Guarantors in the execution of any amended or supplemental Indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
Indenture that affects its own rights, duties or immunities under this
Indenture or otherwise.
Section 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture (including
Section 3.09, 4.10 and 4.14 hereof), the Note Guarantees and the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Notes (including Additional Notes, if any) then
outstanding voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of
the principal of, premium, if any, or interest or Liquidated Damages, if any,
on the Notes, except a payment default resulting from an acceleration that has
been rescinded) or compliance with any provision of this Indenture, the Note
Guarantees or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including
Additional Notes, if any) voting as a single class (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Notes). Notwithstanding the foregoing, any (i) amendment to or waiver
of Section 4.14 hereof, and (ii) amendment to Article 10 herein will require
the consent of the Holders of at least two-thirds in aggregate principal
amount of the Notes then outstanding if such amendment would materially
adversely affect the rights of Holders of Notes. Section 2.08 hereof shall
determine which Notes are considered to be "outstanding" for purposes of this
Section 9.02.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Company and the
Guarantors in the execution of such amended or supplemental Indenture unless
such amended or supplemental Indenture directly 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 amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement 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 amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof,
the Holders of a majority in aggregate principal amount
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of the Notes (including Additional Notes, if any) then outstanding voting as a
single class may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes. However, without the consent of
each Holder affected, an amendment or waiver under this Section 9.02 may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes (other
than Section 4.14 hereof);
(c) reduce the rate of or extend the time for payment of interest on
any Note;
(d) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest or Liquidated Damages, if any, on the Notes
(except a rescission of acceleration of the Notes by the Holders of at least a
majority in aggregate principal amount of the Notes and a waiver of the
payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults;
(g) waive a redemption payment with respect to any Note (other than
Section 4.14 hereof);
(h) release any Guarantor from any of its obligations under its Note
Guarantee or this Indenture, except in accordance with the terms of this
Indenture; or
(i) make any change in the foregoing amendment and waiver provisions.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in an amended or supplemental Indenture that complies with the TIA
as then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note
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. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives
written notice of revocation before the date the waiver, supplement or
amendment becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
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Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until its
Board of Directors approves it. In executing any amended or supplemental
indenture, the Trustee shall be entitled to receive and (subject to Section
7.01 hereof) shall be fully protected in relying upon, in addition to the
documents required by Section 11.04 hereof, an Officer's Certificate and an
Opinion of Counsel stating that the execution of such amended or supplemental
indenture is authorized or permitted by this Indenture.
ARTICLE 10
SUBORDINATION
Section 10.01 Agreement to Subordinate.
The Company agrees, and each Holder by accepting a Note agrees, that
the payment of Subordinated Note Obligations are subordinated in right of
payment, to the extent and in the manner set forth in this Article 10, to the
prior payment in full in cash or cash equivalents of all Senior Indebtedness,
whether outstanding on the date of this Indenture or thereafter incurred and
that the subordination is for the benefit of the holders of Senior
Indebtedness. The provisions of this Article 10 shall constitute a continuing
offer to all Persons that, in reliance upon such provisions, become holders
of, or continue to hold Senior Indebtedness, and they or each of them may
enforce the rights of holders of Senior Indebtedness hereunder, subject to the
terms and provisions hereof.
Section 10.02 Certain Definitions.
"cash equivalents" means Cash Equivalents of the type described in
clause (i) of the definition thereof maturing not more than 90 days after the
date of the acquisition thereof.
"Designated Senior Indebtedness" means (a) any Indebtedness
outstanding under the New Credit Facility; and (b) any other Senior
Indebtedness permitted under this Indenture the principal amount of which is
$25.0 million or more and that has been designated by the Company in writing
to the Trustee as "Designated Senior Indebtedness."
"Permitted Junior Securities" means Equity Interests in the Company
or debt securities of the Company that are subordinated to all Senior
Indebtedness and any debt securities issued in exchange for Senior
Indebtedness to substantially the same extent as, or to a greater extent than,
the Notes are subordinated to Senior Indebtedness.
"Representative" means the indenture trustee or other trustee, agent
or representative for any Senior Indebtedness.
"Senior Indebtedness" means, with respect to any Person, (a) all
Obligations of that Person outstanding under the New Credit Facility and all
Hedging Obligations payable to a lender or an Affiliate thereof or to a Person
that was a lender or an Affiliate thereof at the time the contract was entered
into under the New Credit Facility or any of its Affiliates, including,
without limitation, interest accruing
74
subsequent to the filing of, or which would have accrued but for the filing
of, a petition for bankruptcy, whether or not that interest is an allowable
claim in that bankruptcy proceeding; (b) any other Indebtedness, unless the
instrument under which that Indebtedness is incurred expressly provides that
it is subordinated in right of payment to any other Senior Indebtedness of
that Person; and (c) all Obligations with respect to the foregoing.
Notwithstanding anything to the contrary in the foregoing, Senior Indebtedness
will not include (i) any liability for federal, state, local or other taxes;
(ii) any Indebtedness of that Person, other than pursuant to the New Credit
Facility, to any of its Subsidiaries or other Affiliates; (iii) any trade
payables; or (iv) any Indebtedness that is incurred in violation of this
Indenture.
"Subordinated Note Obligations" means all Obligations with respect to
the Notes, including, without limitation, principal, premium, if any, interest
and Liquidated Damages, if any, payable pursuant to the terms of the Notes
(including upon the acceleration or redemption thereof), together with and
including any amounts received or receivable upon the exercise of rights of
rescission or other rights of action, including claims for damages, or
otherwise.
A "distribution" or "payment" may consist of a distribution, payment
or other transfer of assets by or on behalf of the Company (including, without
limitation, a redemption, repurchase or other acquisition of the Notes) from
any source, of any kind or character, whether in cash, securities or other
property, by set-off or otherwise.
Section 10.03 Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, an
assignment for the benefit of creditors or any marshalling of the Company's
assets and liabilities, (a) the holders of Senior Indebtedness will be
entitled to receive payment in full in cash or cash equivalents of all
Obligations due in respect of such Senior Indebtedness, including interest
after the commencement of any such proceeding at the rate specified in the
applicable Senior Indebtedness, before the Holders of Notes will be entitled
to receive any payment with respect to the Subordinated Note Obligations
(except that Holders of Notes may receive and retain Permitted Junior
Securities and payments and other distributions made from the trust described
in Section 8.04 hereof), and (b) until all Obligations with respect to Senior
Indebtedness are paid in full in cash or cash equivalents, any distribution to
which the Holders of Notes would be entitled but for this Article 10 shall be
made to the holders of Senior Indebtedness (except that Holders of Notes may
receive and retain Permitted Junior Securities and payments and other
distributions made from the trust described in Section 8.04 hereof) as their
interests appear.
Section 10.04 Default on Designated Senior Indebtedness.
The Company may not make any payment or distribution to the Trustee
or any Holder upon or in respect of the Subordinated Note Obligations (except
in Permitted Junior Securities or from the trust described in Section 8.04
hereof) until all principal and other obligations with respect to Senior
Indebtedness have been paid in full in cash or cash equivalents, if:
(a) a default in the payment of the principal (including
reimbursement obligations in respect of letters of credit) of, premium, if
any, or interest on or commitment, letter of credit or administrative fees
relating to, Designated Senior Indebtedness occurs and is continuing beyond
any applicable period of grace in the agreement, indenture or other document
governing such Designated Senior Indebtedness; or
75
(b) any other default occurs and is continuing with respect to
Designated Senior Indebtedness that permits holders of the Designated Senior
Indebtedness as to which that default relates to accelerate its maturity and
the Trustee receives a notice of such default (a "Payment Blockage Notice")
from the Company or the holders of any Designated Senior Indebtedness (or
their Representative).
Payments on the Notes may and shall be resumed (a) in the case of a
payment default, upon the date on which that default is cured or waived; and
(b) in case of a nonpayment default, the earlier of the date on which that
nonpayment default is cured or waived or 179 days after the date on which the
applicable Payment Blockage Notice is received, unless the maturity of any
Designated Senior Indebtedness has been accelerated. No new period of payment
blockage may be commenced unless and until 360 days have elapsed since the
effectiveness of the immediately prior Payment Blockage Notice. No nonpayment
default that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice unless that default shall have been waived
or cured for a period of not less than 90 days.
Section 10.05 Acceleration of Securities.
If payment of the Notes is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness of
the acceleration.
Section 10.06 When Distribution Must Be Paid Over.
In the event that the Trustee or any Holder receives any payment of
any Subordinated Note Obligations at a time when the Trustee or such Holder,
as applicable, has actual knowledge that such payment is prohibited by Section
10.03 or 10.04 hereof, such payment shall be held by the Trustee or such
Holder, in trust for the benefit of, and shall be paid forthwith over and
delivered, upon written request, to, the holders of Senior Indebtedness as
their interests may appear or their Representative under the indenture or
other agreement (if any) pursuant to which Senior Indebtedness may have been
issued, as their respective interests may appear, for application to the
payment of all Obligations with respect to Senior Indebtedness remaining
unpaid to the extent necessary to pay such Obligations in full in accordance
with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or
on behalf of Holders or the Company or any other Person money or assets to
which any holders of Senior Indebtedness shall be entitled by virtue of this
Article 10, except if such payment is made as a result of the willful
misconduct or gross negligence of the Trustee.
Section 10.07 Notice by Company.
The Company shall promptly notify the Trustee and the Paying Agent of
any facts known to the Company that would cause a payment of any Obligations
with respect to the Notes to violate this Article 10, but failure to give such
notice shall not affect the subordination of the Notes to the Senior
Indebtedness as provided in this Article 10.
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Section 10.08 Subrogation.
After all Senior Indebtedness is paid in full in cash or cash
equivalents and until the Notes are paid in full, Holders of Notes shall be
subrogated (equally and ratably with all other Indebtedness pari passu with
the Notes) to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness to the extent that
distributions otherwise payable to the Holders of Notes have been applied to
the payment of Senior Indebtedness. A distribution made under this Article 10
to holders of Senior Indebtedness that otherwise would have been made to
Holders of Notes is not, as between the Company and Holders, a payment by the
Company on the Notes.
Section 10.09 Relative Rights.
This Article 10 defines the relative rights of Holders of Notes and
holders of Senior Indebtedness. Nothing in this Indenture shall:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest and Liquidated Damages, if any, on the Notes in
accordance with their terms;
(2) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of Senior
Indebtedness; or
(3) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the rights
of holders and owners of Senior Indebtedness to receive distributions and
payments otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay principal of
or interest or Liquidated Damages, if any, on a Note on the due date, the
failure is still a Default or Event of Default.
Section 10.10 Subordination May Not Be Impaired by Company.
No right of any holder of Senior Indebtedness to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or any Holder or by the failure of
the Company or any Holder to comply with this Indenture.
Section 10.11 Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee and the Holders of Notes shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
of Notes for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto
or to this Article 10.
77
Section 10.12 Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article 10 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge
of the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless the Trustee shall have received at its
Corporate Trust Office at least five Business Days prior to the date of such
payment written notice of facts that would cause the payment of any
Obligations with respect to the Notes to violate this Article 10. Only the
Company or a Representative may give the notice. Nothing in this Article 10
shall impair the claims of, or payments to, the Trustee under or pursuant to
Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
Section 10.13 Authorization to Effect Subordination.
Each Holder of Notes, by the Holder's acceptance thereof, authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 10, and appoints the Trustee to act as such Holder's attorney-in-fact
for any and all such purposes. If the Trustee does not file a proper proof of
claim or proof of debt in the form required in any proceeding referred to in
Section 6.09 hereof at least 30 days before the expiration of the time to file
such claim, the Representative is hereby authorized to file an appropriate
claim for and on behalf of the Holders of the Notes.
Section 10.14 No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act by any such
holder.
(b) Without in any way limiting the generality of paragraph (a) of
this Section 10.14, the holders of Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Trustee or any
Holder, without incurring responsibility to any Holder and without impairing
or releasing the subordination provided in this Article 10 or the obligations
hereunder of the Holders to the holders of Senior Indebtedness, do any one or
more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, any Senior Indebtedness or
any instrument evidencing the same or any agreement under which Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal
with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any Person liable in any manner for the collection
of Senior Indebtedness; and (iv) exercise or refrain from exercising any
rights against either Company or any other Person.
Section 10.15 Amendments.
The provisions of this Article 10 shall not be amended or modified
without the written consent of the holders of all Senior Indebtedness.
78
Section 10.16 Trustee's Compensation not Prejudiced.
Nothing in this Article 10 shall apply to amounts due to the Trustee
pursuant to other Sections of this Indenture.
ARTICLE 11
NOTE GUARANTEES
Section 11.01 Guarantee.
Subject to this Article 11, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of
this Indenture, the Notes or the obligations of the Company hereunder or
thereunder, that: (1) the principal of and interest on the Notes will be
promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and interest
on the Notes, if any, if lawful, and all other obligations of the Company to
the Holders or the Trustee hereunder or thereunder will be promptly paid in
full or performed, all in accordance with the terms hereof and thereof; and
(2) in case of any extension of time of payment or renewal of any Notes or any
of such other obligations, that same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. Failing payment when due of any
amount so guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same
immediately. Each Guarantor agrees that this is a guarantee of payment and not
a guarantee of collection.
The Guarantors hereby agree that their obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of
the Notes or this Indenture, the absence of any action to enforce the same,
any waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a Guarantor.
Each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the
Company, any right to require a proceeding first against the Company, protest,
notice and all demands whatsoever and covenant that this Note Guarantee shall
not be discharged except by complete performance of the obligations contained
in the Notes and this Indenture.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one
hand, and the Holders and the Trustee, on the other hand, (1) the maturity of
the obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes of this Note Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (2) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Note Guarantee. The
Guarantors shall have the right to seek
79
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Guarantee.
Section 11.02 Subordination of Note Guarantee.
The Obligations of each Guarantor under its Note Guarantee pursuant
to this Article 11 shall be junior and subordinated to the Senior Guarantee of
such Guarantor on the same basis as the Notes are junior and subordinated to
Senior Indebtedness of the Company. For the purposes of the foregoing
sentence, the Trustee and the Holders shall have the right to receive and/or
retain payments by any of the Guarantors only at such times as they may
receive and/or retain payments in respect of the Notes pursuant to this
Indenture, including Article 10 hereof with respect to subordination.
Section 11.03 Limitation of Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee
of such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law to the extent
applicable to any Note Guarantee. To effectuate the foregoing intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that the
obligations of such Guarantor will, after giving effect to such maximum amount
and all other contingent and fixed liabilities of such Guarantor that are
relevant under such laws, and after giving effect to any collections from,
rights to receive contribution from or payments made by or on behalf of any
other Guarantor in respect of the obligations of such other Guarantor under
this Article 11, result in the obligations of such Guarantor under its Note
Guarantee not constituting a fraudulent transfer or conveyance.
Section 11.04 Execution And Delivery Of Note Guarantee.
To evidence its Note Guarantee set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Note Guarantee substantially
in the form included in Exhibit E shall be endorsed by an Officer of such
Guarantor on each Note authenticated and delivered by the Trustee and that
this Indenture shall be executed on behalf of such Guarantor by its President
or one of its Vice Presidents.
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates
the Note on which a Note Guarantee is endorsed, the Note Guarantee shall be
valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Note Guarantee set
forth in this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any new
Subsidiaries subsequent to the date of this Indenture, if required by Section
4.17 hereof, the Company shall cause such Subsidiaries to execute supplemental
indentures to this Indenture and Note Guarantees in accordance with Section
4.17 hereof and this Article 11, to the extent applicable.
80
Section 11.05 Guarantors May Consolidate, Etc., On Certain Terms.
Except as otherwise provided in Section 11.06, no Guarantor may
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person whether or not affiliated with such Guarantor
unless:
(a) subject to Section 11.06 hereof, the Person formed by or
surviving any such consolidation or merger (if other than a Guarantor or the
Company) unconditionally assumes all the obligations of such Guarantor,
pursuant to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under the Notes, this Indenture, the Note
Guarantees and the Registration Rights Agreement on the terms set forth herein
or therein; and
(b) immediately after giving effect to such transaction, no Default
or Event of Default exists.
In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Note Guarantees endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Note Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Note Guarantees so issued shall in all
respects have the same legal rank and benefit under this Indenture as the Note
Guarantees theretofore and thereafter issued in accordance with the terms of
this Indenture as though all of such Note Guarantees had been issued at the
date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of
the Notes shall prevent any consolidation or merger of a Guarantor with or
into the Company or another Guarantor, or shall prevent any sale or conveyance
of the property of a Guarantor as an entirety or substantially as an entirety
to the Company or another Guarantor.
Section 11.06 Releases Following Sale Of Assets.
In the event of a sale or other disposition of all of the assets of a
Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all to the capital stock of a Guarantor, in each case to a
Person that is not (either before or after giving effect to such transactions)
a Restricted Subsidiary of the Company, then such Guarantor (in the event of a
sale or other disposition, by way of merger, consolidation or otherwise, of
all of the capital stock of such Guarantor) or the corporation acquiring the
property (in the event of a sale or other disposition of all or substantially
all of the assets of such Guarantor) will be released and relieved of any
obligations under its Note Guarantee; provided that the Net Proceeds of such
sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including without limitation Section 4.10
hereof. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Note Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article 11.
81
ARTICLE 12
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA Sec. 318(c), the imposed duties shall control.
Section 12.02 Notices.
Any notice or communication by the Company, any Guarantor 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' address.
If to the Company or any Guarantor:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
With a copy to:
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
If to the Trustee:
State Street Bank and Trust Company
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
With a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇ Freed & Gesmer, P.C.
City Place 1
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
The Company, any Guarantor or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
82
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; five Business Days after being deposited in the mail,
postage prepaid, if mailed; 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.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA ss. 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
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 12.03 Communication by Holders of Notes with Other Holders of Notes.
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 anyone else shall have the protection of TIA
ss. 312(c).
Section 12.04 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 12.05 hereof) 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 satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 12.05 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 comply with the provisions of
TIA ss. 314(e) and shall include:
(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;
83
(c) a statement that, in the opinion of such Person, he or she 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 satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 12.06 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 12.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No member, director, officer, employee, incorporator or stockholder
of the Company or any Guarantor, as such, shall have any liability for any
obligations of the Company and the Guarantors under the Notes, the Note
Guarantees or this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes.
Section 12.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 12.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 12.10 Successors.
All agreements of the Company and the Guarantors in this Indenture,
the Notes and the Note Guarantees shall bind their successors. All agreements
of the Trustee in this Indenture shall bind its successors.
Section 12.11 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.
Section 12.12 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.
84
Section 12.13 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 of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
85
SIGNATURES
Dated as of September 29, 1999
▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
By:_____________________________________
Name:
Title:
SBI HOLDINGS, INC.
By:_____________________________________
Name:
Title:
SIERRA BIOMEDICAL, INC.
By:_____________________________________
Name:
Title:
SIERRA BIOMEDICAL SAN DIEGO, INC.
By:_____________________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:_________________________________
Name:
Title:
86
EXHIBIT A-1
(Face of Global Note)
===============================================================================
CUSIP/CINS ______________
13 1/2% Senior Subordinated Notes due 2009
No. __ $
-----------------
▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
promises to pay to _______________, or registered assigns, the principal sum of
____________________________________ Dollars on October 1, 2009.
Interest Payment Dates: October 1 and April 1
Record Dates: September 15 and March 15
Dated: ______
▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
BY:_____________________________________
Name:
Title:
This is one of the Global Notes referred
to in the within-mentioned Indenture:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:_____________________________________
Name:
Title:
================================================================================
A1-1
(Back of Note)
13 1/2% [Series A] [Series B] Senior Subordinated Notes due 2009
[Insert the following if the Note is issued in global form.]
[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 Depositary to
a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. Unless this certificate is presented by an authorized
representative of The Depository Trust Company (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇) ("▇▇▇"), to the issuer or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or such other name as may be requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or such other
entity as may be requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL in as much as the registered owner hereof, Cede & Co., has
an interest herein.]
[Insert the Private Placement legend, if applicable, pursuant to the provisions
of the Indenture]
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. ▇▇▇▇▇▇▇ River Laboratories, Inc., a Delaware corporation
(the "Company"), promises to pay interest on the principal amount of this Note
at 13 1/2% per annum from September 29, 1999 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. Interest on the Notes will accrue at the rate of
13.5% per year; provided that the rate at which interest accrues will increase
to 14.0% per year on August 15, 2000 in the event that the Ratio of
Consolidated Net Debt to Consolidated Cash Flow for the Company as of June 30,
2000 is equal to or greater than 5.00 to 1. The Company will pay interest and
Liquidated Damages semi-annually on October 1 and April 1 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each,
an "Interest Payment Date"). Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing Default in
the payment of interest, and if this Note is authenticated between a record
date referred to on the face hereof and the next succeeding Interest Payment
Date, interest shall accrue from such next succeeding Interest Payment Date;
and provided further that the first Interest Payment Date shall be April 1,
2000. The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; it shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of
interest and Liquidated Damages (without regard to any applicable grace
periods) from time to time on demand at the same rate to the extent lawful.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the September 15 or
March 15 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes will be payable as to principal, premium and Liquidated
Damages, if any, and interest at the office of the Paying Agent and Registrar.
A1-2
Holders of Notes must surrender their Notes to the Paying Agent to collect
principal payments, and the Company may pay principal and interest and
Liquidated Damages, if any, by check and may mail checks to a Holder's
registered address; provided that all payments with respect to Global Notes
and Definitive Notes, the Holders of which have given wire transfer
instructions to the Company, will be required to be made by wire transfer of
immediately available funds to the accounts specified by the Holders thereof.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, State Street Bank and Trust
Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. 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 [September 24], 1999 ("Indenture"), between the Company 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, as
amended (15 U.S. Code ▇▇.▇▇. 77aaa-77bbbb). The Notes are subject to all such
terms, and Holders are referred to the Indenture and such Act for a statement
of such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture shall
govern and be controlling. The Notes are obligations of the Company initially
limited to $150.0 million in aggregate principal amount. Additional Notes may
be issued pursuant to Sections 2.02 and 4.09 of the Indenture and, if issued,
will be treated as a single class for all purposes under the Indenture.
5. OPTIONAL REDEMPTION.
(a) Except as provided in subparagraph (b) of this Paragraph 5, the
Notes will not be redeemable at the Company's option prior to October 1, 2004.
Thereafter, the Notes will be subject to redemption at any time at the option
of the Company, in whole or in part, upon not less than 30 nor more than 60
days' notice, in cash at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable redemption date, if
redeemed during the twelve-month period beginning on October 1 of the years
indicated below:
Year Percentage
---- ----------
2004.....................................................106.750%
2005.....................................................104.500%
2006.....................................................102.250%
2007 and thereafter......................................100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, on or prior to October 1, 2002, the Company may redeem up to 35%
of the aggregate principal amount of Notes ever issued under the Indenture in
cash at a redemption price of 113.500% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
redemption date, with the net cash proceeds of one or more Public Equity
Offerings; provided that at least 65% of the aggregate principal amount of
Notes ever issued under the Indenture remains outstanding immediately after
the occurrence of any such redemption; and provided further that such
redemption shall occur within 90 days of the date of the closing of any such
Public Equity Offering.
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(c) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. Except as set forth in paragraph 7 below,
the Company shall not be required to make mandatory redemption payments with
respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, each Holder of
Notes will have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described in Section 4.14 of the Indenture (the "Change
of Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 60 days following any Change of Control, the Company will,
or will cause the Trustee to, mail a notice to each Holder describing the
transaction or transactions that constitute the Change of Control and offering
to repurchase Notes on the date specified in such notice, which date shall be
no earlier than 30 days and no later than 60 days from the date such notice is
mailed, pursuant to the procedures required by the Indenture and described in
such notice.
(b) Within 365 days after the receipt of any Net Proceeds from
an Asset Sale, the Company or the Restricted Subsidiary, as the case may be,
shall apply the Net Proceeds, at its option (or to the extent the Company is
required to apply the Net Proceeds pursuant to the terms of the New Credit
Facility), to (a) repay or purchase Senior Indebtedness or Pari Passu
Indebtedness of the Company or any Indebtedness of any Restricted Subsidiary,
as the case may be, provided that, if the Company shall so repay or purchase
Pari Passu Indebtedness of the Company; (i) it will equally and ratably reduce
Indebtedness under the Notes if the Notes are then redeemable; or (ii) if the
Notes may not then be redeemed, the Company shall make an offer, in accordance
with the procedures set forth in the Indenture, to all Holders of Notes to
purchase at a purchase price equal to 100% of the principal amount of the
Notes, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of purchase, the Notes that would otherwise be redeemed;
or (b)(i) an investment in property, the making of a capital expenditure or
the acquisition of assets that are used or useful in a Permitted Business; or
(ii) the acquisition of Capital Stock of any Person primarily engaged in a
Permitted Business if (x) as a result of the acquisition by the Company or any
Restricted Subsidiary thereof, such Person becomes a Restricted Subsidiary; or
(y) the Investment in that Capital Stock is permitted by clause (6) of the
definition of Permitted Investments. Pending the final application of any such
Net Proceeds, the Company may temporarily reduce Indebtedness or otherwise
invest those Net Proceeds in any manner that is not prohibited by this
Indenture. Any Net Proceeds from Asset Sales that are not applied or invested
as provided in the first sentence of this paragraph will be deemed to
constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds
exceeds $10.0 million, the Company will be required to make an offer to all
Holders of Notes (an "Asset Sale Offer") to purchase the maximum principal
amount of Notes that may be purchased out of the Excess Proceeds, at an offer
price in cash in an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
date of purchase, in accordance with the procedures set forth in this
Indenture. To the extent that any Excess Proceeds remain after consummation of
an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose
not otherwise prohibited by this Indenture. If the aggregate principal amount
of Notes surrendered by Holders thereof in connection with an Asset Sale Offer
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes to
be purchased as set forth under Sections 3.02 and 3.03 of the Indenture. Upon
completion of such offer to purchase, the amount of Excess Proceeds shall be
reset at zero. Holders of Notes that are the subject of an offer to purchase
may elect to have such Notes purchased by completing the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Notes.
A1-4
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes
or portions thereof called for redemption.
9. 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 Company need not
exchange or register the transfer of any Note or portion of a Note selected
for redemption, except for the unredeemed portion of any Note being redeemed
in part. Also, the Company need not exchange or register the transfer 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.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Note Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes (and Additional Notes, if any)
and any existing Default or compliance with any provision of the Indenture,
the Note Guarantees or the Notes may be waived with the consent of the Holders
of a majority in principal amount of the then outstanding Notes (and
Additional Notes, if any). Without the consent of any Holder of a Note, the
Indenture, the Note Guarantees or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated
Notes in addition to or in place of certificated Notes, to provide for the
assumption of the Company's or Guarantor's obligations to Holders of the Notes
in case of a merger or consolidation, 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 under the Indenture of any such
Holder, to comply with the requirements of the Commission in order to effect
or maintain the qualification of the Indenture under the Trust Indenture Act,
to provide for the Issuance of Additional Notes in accordance with the
limitations set forth in the Indenture, or to allow any Guarantor to execute a
supplemental indenture to the Indenture and/or a Note Guarantee with respect
to the Notes.
12. DEFAULTS AND REMEDIES. Each of the following constitutes an
"Event of Default": (a) default for 30 days in the payment when due of
interest on, or Liquidated Damages with respect to, the Notes (whether or not
prohibited by Article 10 of the Indenture); (b) default in payment when due of
the principal of or premium, if any, on the Notes (whether or not prohibited
by Article 10 of the Indenture); (c) failure by the Company or any of its
Restricted Subsidiaries for 30 days after receipt of notice from the Trustee
or Holders of at least 25% in principal amount of the Notes (including
Additional Notes, if any) then outstanding to comply with Sections 4.07, 4.09,
4.10, 4.14 or Article 5 hereof; (d) failure by the Company for 60 days after
notice from the Trustee or the Holders of at least 25% in principal amount of
the Notes then outstanding to comply with any of its other agreements in this
Indenture or the Notes; (e) default under 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 of its
Restricted Subsidiaries (or the payment of which is guaranteed by the Company
or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee
now exists, or is created after the date of this Indenture, which default (i)
is caused by a failure to pay Indebtedness at its stated final maturity (after
giving effect to any applicable grace period provided in such Indebtedness) (a
"Payment Default") or (ii) results in the acceleration of such
A1-5
Indebtedness prior to its stated final maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal amount
of any other such Indebtedness under which there has been a Payment Default or
the maturity of which has been so accelerated, aggregates $10.0 million or
more; (f) failure by the Company or any of its Restricted Subsidiaries to pay
final judgments aggregating in excess of $10.0 million (net of any amounts
with respect to which a reputable and creditworthy insurance company has
acknowledged liability in writing), which judgments are not paid, discharged
or stayed for a period of 60 days; (g) except as permitted by the Indenture,
if any Note Guarantee shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full force and
effect or any Guarantor, or any Person acting on behalf of a Guarantor, shall
deny or disaffirm its obligations under its Note Guarantee; and (h) certain
events of bankruptcy or insolvency as described in the Indenture.
If any Event of Default (other than certain events of bankruptcy or
insolvency) occurs and is continuing, Holders of at least 25% in principal
amount of the then outstanding Notes may direct the Trustee to declare all the
Notes to be due and payable immediately. However, so long as any Indebtedness
permitted to be incurred pursuant to the New Credit Facility shall be
outstanding, such acceleration shall not be effective until the earlier of (i)
an acceleration under any such Indebtedness under the New Credit Facility; or
(ii) five Business Days after receipt by the Company and the administrative
agent under the New Credit Facility of written notice of such acceleration.
Except as stated in the prior sentence, upon any such declaration, the Notes
shall become due and payable immediately. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice. Holders of the Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. The Holders of a majority in
aggregate principal amount of the then outstanding Notes by written notice to
the Trustee may on behalf of all of the Holders rescind an acceleration and
its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default (except nonpayment of principal
or interest that has become due solely because of the acceleration) have been
cured or waived provided that, in the event of a declaration of acceleration
of the Notes because an Event of Default has occurred and is continuing as a
result of the acceleration of any Indebtedness described in clause (e) of
Section 12 above, the declaration of acceleration of the Notes shall be
automatically annulled if the holders of any Indebtedness described in clause
(e) of Section 12 above have rescinded the declaration of acceleration in
respect of such Indebtedness within 30 days of the date of such declaration
and if (i) the annulment of the acceleration of the Notes would not conflict
with any judgment or decree of a court of competent jurisdiction; and (ii) all
existing Events of Default, except non-payment of principal or interest on the
Notes that became due solely because of the acceleration of the Notes, have
been cured or waived, provided that, in the event of a declaration of
acceleration of the Notes because an Event of Default has occurred and is
continuing as a result of the acceleration of any Indebtedness described in
clause (e) of this Section 12, the declaration of acceleration of the Notes
shall be automatically annulled if the holders of any Indebtedness described
in clause (e) of this Section 12 have rescinded the declaration of
acceleration in respect of such Indebtedness within 30 days of the date of
such declaration and if (i) the annulment of the acceleration of the Notes
would not conflict with any judgment or decree of a court of competent
jurisdiction and (ii) all existing Events of Default, except non-payment of
principal or interest on the Notes that became due solely because of the
acceleration of the Notes, have been cured or waived. The Company is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Company is required upon becoming aware of any Default or
Event of Default to deliver to the Trustee a statement specifying such Default
or Event of Default.
13. SUBORDINATION. The payment of Subordinated Note Obligations
will be subordinated in right of payment, as set forth in the Indenture, to
the prior payment in full in cash or cash equivalents of all Senior
Indebtedness, whether outstanding on the date of the Indenture or thereafter
incurred. the Company agrees, and each Holder by accepting a Note agrees, that
the payment of principal of, premium
A1-6
and interest and Liquidated Damages, if any, on the Notes is subordinated in
right of payment, to the extent and in the manner provided in the Indenture,
to the prior payment in full in cash or cash equivalents of all Senior
Indebtedness (whether outstanding on the date hereof or thereafter created,
incurred, assumed or guaranteed), and that the subordination is for the
benefit of the holders of Senior Indebtedness.
14. TRUSTEE DEALINGS WITH COMPANY. The Trustee, 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 the Trustee.
15. NO RECOURSE AGAINST OTHERS. No member, director, officer,
employee, incorporator or stockholder, of the Company or any Guarantor, as
such, shall have any liability for any obligations of the Company and the
Guarantors under the Notes, the Note Guarantees or the Indenture 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.
16. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
17. 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).
18. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration
Rights Agreement dated as of September 29, 1999, between the Company and the
parties named on the signature pages thereof (the "Registration Rights
Agreement").
19. 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 the Trustee may 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.
The Company will 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:
▇▇▇▇▇▇▇ River Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
A1-7
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_________________________________________________________
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 Note)
Tax Identification No:
Signature Guarantee:____________________________
A1-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $________
Date: Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No:
-------------------------
Signature Guarantee:_______________________
A1-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE1
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount
Amount of decrease Amount of increase in of this Global Signature of
in Principal Amount Principal Amount Note following such authorized officer
of this of this decrease of Trustee or Note
Date of Exchange Global Note Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- ------------------
____________
1 This should be included only if the Note is issued in global form.
A1-10
EXHIBIT A-2
(Face of Regulation S Temporary Global Note)
===============================================================================
CUSIP/CINS ___________
13 1/2% Senior Subordinated Notes due 2009
No.__ $
-----------------
▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
promises to pay to _________________, oe registered assigns, the principal sum
of ______________ Dollars on October 1, 2009.
Interest Payment Dates: October 1 and April 1
Record Dates: September 15 and March 15
Dated:
▇▇▇▇▇▇▇ RIVER LABORATORIES, INC.
BY:_____________________________________
Name:
Title:
This is one of the Global Notes referred
to in the within-mentioned Indenture:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:_____________________________________
Name:
Title:
================================================================================
A2-1
(Back of Regulation S Temporary Global Note)
13 1/2% [Series A] [Series B] Senior Subordinated Notes due 2009
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE
AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER ▇▇▇▇▇▇▇ ▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A OR REGULATION S THEREUNDER. THE HOLDER OF
THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a)
INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (d) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF THE
SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR") THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT
OF SECURITIES LESS THAN $250,000, AN OPINION OF COUNSEL THAT SUCH TRANSFER IS
IN COMPLIANCE WITH THE SECURITIES ACT OR (e) IN ACCORDANCE WITH ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED
UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. ▇▇▇▇▇▇▇ River Laboratories, Inc., a Delaware
corporation (the "Company"), promises to pay interest on the principal amount
of this Note at 13 1/2% per annum from September 29, 1999 until maturity and
shall pay the Liquidated Damages payable pursuant to Section 5 of the
Registration Rights Agreement referred to below. Interest on the Notes will
accrue at the rate of 13.5% per year; provided that the rate at which interest
accrues will increase to 14.0% per year on August 15,
A2-2
2000 in the event that the Ratio of Consolidated Net Debt to Consolidated Cash
Flow for the Company as of June 30, 2000 is equal to or greater than 5.00 to
1. The Company will pay interest and Liquidated Damages semi-annually on
October 1 and April 1 of each year, or if any such day is not a Business Day,
on the next succeeding Business Day (each, an "Interest Payment Date").
Interest on the Notes will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from the date of issuance;
provided that if there is no existing Default in the payment of interest, and
if this Note is authenticated between a record date referred to on the face
hereof and the next succeeding Interest Payment Date, interest shall accrue
from such next succeeding Interest Payment Date; and provided further that the
first Interest Payment Date shall be April 1, 2000. The Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate that is 1% per annum in excess of the rate then in effect; it
shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest and Liquidated Damages
(without regard to any applicable grace periods) from time to time on demand
at the same rate to the extent lawful. Interest will be computed on the basis
of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the
Notes (except defaulted interest) and Liquidated Damages to the Persons who
are registered Holders of Notes at the close of business on the September 15
or March 15 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes will be payable as to principal, premium and Liquidated
Damages, if any, and interest at the office of the Paying Agent and Registrar.
Holders of Notes must surrender their Notes to the Paying Agent to collect
principal payments, and the Company may pay principal and interest and
Liquidated Damages, if any, by check and may mail checks to a Holder's
registered address; provided that all payments with respect to Global Notes
and Definitive Notes, the Holders of which have given wire transfer
instructions to the Company, will be required to be made by wire transfer of
immediately available funds to the accounts specified by the Holders thereof.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, State Street Bank and
Trust Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. 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 [September 24], 1999 ("Indenture"), between the Company 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, as amended (15 U.S. Code ▇▇.▇▇. 77aaa-77bbbb). The Notes are subject to
all such terms, and Holders are referred to the Indenture and such Act for a
statement of such terms. To the extent any provision of this Note conflicts
with the express provisions of the Indenture, the provisions of the Indenture
shall govern and be controlling. The Notes are obligations of the Company
initially limited to $150.0 million in aggregate principal amount. Additional
Notes may be issued pursuant to Sections 2.02 and 4.09 of the Indenture and,
if issued, will be treated as a single class for all purposes under the
Indenture.
5. OPTIONAL REDEMPTION.
(a) Except as provided in subparagraph (b) of this Paragraph 5,
the Notes will not be redeemable at the Company's option prior to October 1,
2004. Thereafter, the Notes will be subject to redemption at any time at the
option of the Company, in whole or in part, upon not less than 30 nor more
A2-3
than 60 days' notice, in cash at the redemption prices (expressed as
percentages of principal amount) set forth below, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the applicable redemption
date, if redeemed during the twelve-month period beginning on October 1 of the
years indicated below:
Year Percentage
---- ----------
2004.........................................................106.750%
2005.........................................................104.500%
2006.........................................................102.250%
2007 and thereafter..........................................100.000%
(b)......Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, on or prior to October 1, 2002, the Company may redeem up to 35%
of the aggregate principal amount of Notes ever issued under the Indenture in
cash at a redemption price of 113.500% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
redemption date, with the net cash proceeds of one or more Public Equity
Offerings; provided that at least 65% of the aggregate principal amount of
Notes ever issued under the Indenture remains outstanding immediately after
the occurrence of any such redemption; and provided further that such
redemption shall occur within 90 days of the date of the closing of any such
Public Equity Offering.
(c) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. Except as set forth in paragraph 7 below,
the Company shall not be required to make mandatory redemption payments with
respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, each Holder of
Notes will have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described in Section 4.14 of the Indenture (the "Change
of Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 60 days following any Change of Control, the Company will,
or will cause the Trustee to, mail a notice to each Holder describing the
transaction or transactions that constitute the Change of Control and offering
to repurchase Notes on the date specified in such notice, which date shall be
no earlier than 30 days and no later than 60 days from the date such notice is
mailed, pursuant to the procedures required by the Indenture and described in
such notice.
(b). Within 365 days after the receipt of any Net Proceeds from
an Asset Sale, the Company or the Restricted Subsidiary, as the case may be,
shall apply the Net Proceeds, at its option (or to the extent the Company is
required to apply the Net Proceeds pursuant to the terms of the New Credit
Facility), to (a) repay or purchase Senior Indebtedness or Pari Passu
Indebtedness of the Company or any Indebtedness of any Restricted Subsidiary,
as the case may be, provided that, if the Company shall so repay or purchase
Pari Passu Indebtedness of the Company; (i) it will equally and ratably reduce
Indebtedness under the Notes if the Notes are then redeemable; or (ii) if the
Notes may not then be redeemed, the Company shall make an offer, in accordance
with the procedures set forth in the Indenture, to all Holders of Notes to
purchase at a purchase price equal to 100% of the principal amount of the
Notes, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of purchase, the Notes that would otherwise be redeemed;
A2-4
or (b)(i) an investment in property, the making of a capital expenditure or
the acquisition of assets that are used or useful in a Permitted Business; or
(ii) the acquisition of Capital Stock of any Person primarily engaged in a
Permitted Business if (x) as a result of the acquisition by the Company or any
Restricted Subsidiary thereof, such Person becomes a Restricted Subsidiary; or
(y) the Investment in that Capital Stock is permitted by clause (6) of the
definition of Permitted Investments. Pending the final application of any such
Net Proceeds, the Company may temporarily reduce Indebtedness or otherwise
invest those Net Proceeds in any manner that is not prohibited by this
Indenture. Any Net Proceeds from Asset Sales that are not applied or invested
as provided in the first sentence of this paragraph will be deemed to
constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds
exceeds $10.0 million, the Company will be required to make an offer to all
Holders of Notes (an "Asset Sale Offer") to purchase the maximum principal
amount of Notes that may be purchased out of the Excess Proceeds, at an offer
price in cash in an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
date of purchase, in accordance with the procedures set forth in this
Indenture. To the extent that any Excess Proceeds remain after consummation of
an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose
not otherwise prohibited by this Indenture. If the aggregate principal amount
of Notes surrendered by Holders thereof in connection with an Asset Sale Offer
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes to
be purchased as set forth under Sections 3.02 and 3.03 of the Indenture. Upon
completion of such offer to purchase, the amount of Excess Proceeds shall be
reset at zero. Holders of Notes that are the subject of an offer to purchase
may elect to have such Notes purchased by completing the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes
or portions thereof called for redemption.
9. 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 Company need not
exchange or register the transfer of any Note or portion of a Note selected
for redemption, except for the unredeemed portion of any Note being redeemed
in part. Also, the Company need not exchange or register the transfer 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.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Note Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes (and Additional Notes, if any)
and any existing Default or compliance with any provision of the Indenture,
the Note Guarantees or the Notes may be waived with the consent of the Holders
of a majority in principal amount of the then outstanding Notes (and
Additional Notes, if any). Without the consent of any Holder of a Note, the
Indenture, the Note Guarantees or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated
Notes in addition to or in place of certificated Notes, to provide for the
assumption of the Company's or Guarantor's obligations to Holders of the Notes
in case of a merger or
A2-5
consolidation, 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 under the Indenture of any such Holder, to
comply with the requirements of the Commission in order to effect or maintain
the qualification of the Indenture under the Trust Indenture Act, to provide
for the Issuance of Additional Notes in accordance with the limitations set
forth in the Indenture, or to allow any Guarantor to execute a supplemental
indenture to the Indenture and/or a Note Guarantee with respect to the Notes.
12. DEFAULTS AND REMEDIES. Each of the following constitutes an
"Event of Default": (a) default for 30 days in the payment when due of
interest on, or Liquidated Damages with respect to, the Notes (whether or not
prohibited by Article 10 of the Indenture); (b) default in payment when due of
the principal of or premium, if any, on the Notes (whether or not prohibited
by Article 10 of the Indenture); (c) failure by the Company or any of its
Restricted Subsidiaries for 30 days after receipt of notice from the Trustee
or Holders of at least 25% in principal amount of the Notes (including
Additional Notes, if any) then outstanding to comply with Sections 4.07, 4.09,
4.10, 4.14 or Article 5 hereof; (d) failure by the Company for 60 days after
notice from the Trustee or the Holders of at least 25% in principal amount of
the Notes then outstanding to comply with any of its other agreements in this
Indenture or the Notes; (e) default under 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 of its
Restricted Subsidiaries (or the payment of which is guaranteed by the Company
or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee
now exists, or is created after the date of this Indenture, which default (i)
is caused by a failure to pay Indebtedness at its stated final maturity (after
giving effect to any applicable grace period provided in such Indebtedness) (a
"Payment Default") or (ii) results in the acceleration of such Indebtedness
prior to its stated final maturity and, in each case, the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $10.0 million or more; (f) failure
by the Company or any of its Restricted Subsidiaries to pay final judgments
aggregating in excess of $10.0 million (net of any amounts with respect to
which a reputable and creditworthy insurance company has acknowledged
liability in writing), which judgments are not paid, discharged or stayed for
a period of 60 days; (g) except as permitted by the Indenture, if any Note
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any
Guarantor, or any Person acting on behalf of a Guarantor, shall deny or
disaffirm its obligations under its Note Guarantee; and (h) certain events of
bankruptcy or insolvency as described in the Indenture.
If any Event of Default (other than certain events of bankruptcy or
insolvency) occurs and is continuing, Holders of at least 25% in principal
amount of the then outstanding Notes may direct the Trustee to declare all the
Notes to be due and payable immediately. However, so long as any Indebtedness
permitted to be incurred pursuant to the New Credit Facility shall be
outstanding, such acceleration shall not be effective until the earlier of (i)
an acceleration under any such Indebtedness under the New Credit Facility; or
(ii) five Business Days after receipt by the Company and the administrative
agent under the New Credit Facility of written notice of such acceleration.
Except as stated in the prior sentence, upon any such declaration, the Notes
shall become due and payable immediately. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice. Holders of the Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. The Holders of a majority in
aggregate principal amount of the then outstanding Notes by written notice to
the Trustee may on behalf of all of the Holders rescind an acceleration and
its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default (except nonpayment of principal
or interest that has become due solely because of the acceleration) have been
cured or waived provided that, in the event of a declaration of acceleration
of the Notes because an Event of Default has occurred and is continuing as a
result of the acceleration of any
A2-6
Indebtedness described in clause (e) of Section 12 above, the declaration of
acceleration of the Notes shall be automatically annulled if the holders of
any Indebtedness described in clause (e) of Section 12 above have rescinded
the declaration of acceleration in respect of such Indebtedness within 30 days
of the date of such declaration and if (i) the annulment of the acceleration
of the Notes would not conflict with any judgment or decree of a court of
competent jurisdiction; and (ii) all existing Events of Default, except
non-payment of principal or interest on the Notes that became due solely
because of the acceleration of the Notes, have been cured or waived, provided
that, in the event of a declaration of acceleration of the Notes because an
Event of Default has occurred and is continuing as a result of the
acceleration of any Indebtedness described in clause (e) of this Section 12,
the declaration of acceleration of the Notes shall be automatically annulled
if the holders of any Indebtedness described in clause (e) of this Section 12
have rescinded the declaration of acceleration in respect of such Indebtedness
within 30 days of the date of such declaration and if (i) the annulment of the
acceleration of the Notes would not conflict with any judgment or decree of a
court of competent jurisdiction and (ii) all existing Events of Default,
except non-payment of principal or interest on the Notes that became due
solely because of the acceleration of the Notes, have been cured or waived.
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required upon
becoming aware of any Default or Event of Default to deliver to the Trustee a
statement specifying such Default or Event of Default.
13. SUBORDINATION. The payment of Subordinated Note Obligations
will be subordinated in right of payment, as set forth in the Indenture, to
the prior payment in full in cash or cash equivalents of all Senior
Indebtedness, whether outstanding on the date of the Indenture or thereafter
incurred. the Company agrees, and each Holder by accepting a Note agrees, that
the payment of principal of, premium and interest and Liquidated Damages, if
any, on the Notes is subordinated in right of payment, to the extent and in
the manner provided in the Indenture, to the prior payment in full in cash or
cash equivalents of all Senior Indebtedness (whether outstanding on the date
hereof or thereafter created, incurred, assumed or guaranteed), and that the
subordination is for the benefit of the holders of Senior Indebtedness.
14. TRUSTEE DEALINGS WITH COMPANY. The Trustee, 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 the Trustee.
15. NO RECOURSE AGAINST OTHERS. No member, director, officer,
employee, incorporator or stockholder, of the Company or any Guarantor, as
such, shall have any liability for any obligations of the Company and the
Guarantors under the Notes, the Note Guarantees or the Indenture 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.
16. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
17. 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).
18. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the
A2-7
Registration Rights Agreement dated as of September 29, 1999, between the
Company and the parties named on the signature pages thereof (the
"Registration Rights Agreement").
19. 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 the Trustee may 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.
The Company will 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:
▇▇▇▇▇▇▇ River Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
A2-8
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 ______________________________ 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 Note)
Tax Identification No:_________________________
Signature Guarantee:____________________________
A2-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $________
Date: Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No:_________________________
Signature Guarantee:_______________________
A2-10
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or of other Restricted
Global Notes for an interest in this Regulation S Temporary Global Note, have
been made:
Principal Amount
Amount of decrease Amount of increase in of this Global Signature of
in Principal Amount Principal Amount Note following such authorized officer
of this of this decrease of Trustee or Note
Date of Exchange Global Note Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- ------------------
A2-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
▇▇▇▇▇▇▇ River Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
State Street Bank and Trust Company
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department, Transfer Unit
Re: 13 1/2% Senior Subordinated Notes due 2009
Reference is hereby made to the Indenture, dated as of September 29,
1999 (the "Indenture"), among ▇▇▇▇▇▇▇ River Laboratories, Inc. (the
"Company"), as issuer, the Guarantors listed on the signature pages thereto,
and State Street Bank and Trust Company, as trustee. Capitalized terms used
but not defined herein shall have the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to __________ (the "Transferee"), as further specified in Annex A
hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest in the
144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Note for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and
such Person and each such account is a "qualified institutional buyer" within
the meaning of Rule 144A in a transaction meeting the requirements of Rule
144A and such Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the 144A Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial interest in the
Regulation S Temporary Global Note, the Regulation S Global Note or a
Definitive Note pursuant to Regulation S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities
Act and, accordingly, the Transferor hereby further certifies that (i) the
Transfer is not being
B-1
made to a Person in the United States and (x) at the time the buy order was
originated, the Transferee was outside the United States or such Transferor
and any Person acting on its behalf reasonably believed and believes that the
Transferee was outside the United States or (y) the transaction was executed
in, on or through the facilities of a designated offshore securities market
and neither such Transferor nor any Person acting on its behalf knows that the
transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements
of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act and
(iii) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note, the Regulation S Temporary Global Note and/or
the Definitive Note and in the Indenture and the Securities Act.
3. [ ] Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Note or a Definitive Note pursuant to any provision
of the Securities Act other than Rule 144A or Regulation S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive
Notes and pursuant to and in accordance with the Securities Act and any
applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance
with the prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or
Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation
D under the Securities Act and the Transfer complies with the
transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the
requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee in the form
of Exhibit D to the Indenture and (2) if such Transfer is in respect
of a principal amount of Notes at the time of transfer of less than
$250,000, an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance
with the Securities Act. Upon consummation of the proposed transfer
in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the IAI Global Note and/or the Definitive Notes and in the
Indenture and the Securities Act.
4. [ ] Check if Transferee will take delivery of a beneficial interest in an
Unrestricted Global Note or of an Unrestricted Definitive Note.
B-2
(a) [ ] Check if Transfer is pursuant to Rule 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule 144,
Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the
Restricted Global Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
------------------------------------
[Insert Name of Transferor]
BY:_______________________________
Name:
Title:
Dated: __________, ____
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP __________), or
(iii) [ ] IAI Global Note (CUSIP __________), or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP __________), or (ii)
(ii) [ ] Regulation S Global Note (CUSIP __________), or
(iii) [ ] IAI Global Note (CUSIP __________), or (iv)
(iv) [ ] Unrestricted Global Note (CUSIP __________), or
(b) [ ] a Restricted Definitive Note, or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
▇▇▇▇▇▇▇ River Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
State Street Bank and Trust Company
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department, Transfer Unit
Re: 13 1/2% Senior Subordinated Notes Due 2009
Reference is hereby made to the Indenture, dated as of September 29,
1999 (the "Indenture"), among ▇▇▇▇▇▇▇ River Laboratories, Inc. (the
"Company"), as issuer, the Guarantors listed on the signature pages thereto,
and State Street Bank and Trust Company, as trustee. Capitalized terms used
but not defined herein shall have the meanings given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the Note[s]
or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection
with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial
Interests in an Unrestricted Global Note
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In
connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Note for a beneficial interest in an Unrestricted Global
Note in an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Global Notes and pursuant to and in accordance
with the United States Securities Act of 1933, as amended (the "Securities
Act"), (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the beneficial interest in an Unrestricted Global
Note is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(b) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive
Note is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the
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Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United
States.
(c) [ ] Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in
an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest
is being acquired in compliance with any applicable blue sky securities laws
of any state of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Definitive Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies
that the Restricted Definitive Note is being acquired for the Owner's own
account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Note and
in the Indenture and the Securities Act.
(b) [ ] Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest
in the [CHECK ONE] [GRAPHIC OMITTED] "144A Global Note", [GRAPHIC OMITTED]
"Regulation S Global Note", [GRAPHIC OMITTED] "IAI Global Note" with an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance
with the Securities Act, and in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
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This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
--------------------------------------
[Insert Name of Owner]
By:________________________________
Name:
Title:
Dated: __________, ____
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EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
▇▇▇▇▇▇▇ River Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: General Counsel
State Street Bank and Trust Company
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department, Transfer Unit
Re: 13 1/2% Senior Subordinated Notes due 2009
Reference is hereby made to the Indenture, dated as of September 29,
1999 (the "Indenture"), among ▇▇▇▇▇▇▇ River Laboratories, Inc. (the
"Company"), as issuer, the Guarantors listed on the signature pages thereto,
and State Street Bank and Trust Company, as trustee. Capitalized terms used
but not defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions
set forth in the Indenture and the undersigned agrees to be bound by,
and not to resell, pledge or otherwise transfer the Notes or any
interest therein except in compliance with, such restrictions and
conditions and the United States Securities Act of 1933, as amended
(the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any
interest therein may not be offered or sold except as permitted in
the following sentence. We agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, that if
we should sell the Notes or any interest therein, we will do so only
(A) to the Company or any subsidiary thereof, (B) in accordance with
Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited
investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and
to the Company a signed letter substantially in the
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form of this letter and, if such transfer is in respect of a
principal amount of Notes, at the time of transfer of less than
$250,000, an Opinion of Counsel in form reasonably acceptable to the
Company to the effect that such transfer is in compliance with the
Securities Act, (D) outside the United States in accordance with Rule
904 of Regulation S under the Securities Act, (E) pursuant to the
provisions of Rule 144(k) under the Securities Act or (F) pursuant to
an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Note
or beneficial interest in a Global Note from us in a transaction
meeting the requirements of clauses (A) through (E) of this paragraph
a notice advising such purchaser that resales thereof are restricted
as stated herein.
3. We understand that, on any proposed resale of the Notes or beneficial
interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as
you and the Company may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions. We further
understand that the Notes purchased by us will bear a legend to the
foregoing effect. We further understand that any subsequent transfer
by us of the Notes or beneficial interest therein acquired by us must
be effected through one of the Placement Agents.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act)
and have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of our
investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its
investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we
exercise sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.
---------------------------------------
[Insert Name of Accredited Investor]
By: _______________________________
Name:
Title:
Dated: __________________, ____
D-2
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of [September 24], 1999 (the "Indenture")
among ▇▇▇▇▇▇▇ River Laboratories, Inc., the Guarantors listed on Schedule I
thereto and State Street Bank and Trust Company, as trustee (the "Trustee"),
(a) the due and punctual payment of the principal of, premium, if any, and
interest on the Notes (as defined in the Indenture), whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of
interest on overdue principal and premium, and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations
of the Company to the Holders or the Trustee all in accordance with the terms
of the Indenture and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that the same will be
promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, whether at stated maturity, by acceleration or
otherwise. The obligations of the Guarantors to the Holders of Notes and to
the Trustee pursuant to the Note Guarantee and the Indenture are expressly set
forth in Article 11 of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Note Guarantee. Each Holder of a Note,
by accepting the same, (a) agrees to and shall be bound by such provisions,
(b) authorizes and directs the Trustee, on behalf of such Holder, to take such
action as may be necessary or appropriate to effectuate the subordination as
provided in the Indenture and (c) appoints the Trustee attorney-in-fact of
such Holder for such purpose; provided, however, that the Indebtedness
evidenced by this Note Guarantee shall cease to be so subordinated and subject
in right of payment upon any defeasance of this Note in accordance with the
provisions of the Indenture.
[NAME OF GUARANTOR(S)]
By:_________________________________
Name:
Title:
E-1
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of [
___, 1999] among [__________________] (the "Guaranteeing Subsidiary"), a
subsidiary of ▇▇▇▇▇▇▇ River Laboratories, Inc. (or its permitted successor), a
Delaware corporation (the "Company"), the Company, the other Guarantors (as
defined in the Indenture referred to herein) and State Street Bank and Trust
Company, as trustee under the indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of September 29, 1999
providing for the issuance of an aggregate principal amount of up to $150.0
million of 13 1/2% Senior Subordinated Notes due 2009 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiary shall
unconditionally guarantee all of the Company's Obligations under the Notes and
the Indenture on the terms and conditions set forth herein (the "Note
Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all Guarantors named in the Indenture, to jointly and
severally Guarantee to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and
assigns, the Notes or the obligations of the Company hereunder or
thereunder, that:
(i) the principal of and interest on the Notes will be
promptly paid in full when due, whether at
maturity, by acceleration, redemption or otherwise,
and interest on the overdue principal of and
interest on the Notes, if any, if lawful, and all
other obligations of the Company to the Holders or
the Trustee hereunder or thereunder will be
promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other
obligations, that same will be promptly paid in
full when due or performed in accordance with the
terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
Failing payment when due of any
F-1
amount so guaranteed or any performance so guaranteed
for whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same immediately.
(b) The obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Notes or the
Indenture, the absence of any action to enforce the same, any waiver
or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company,
any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a
guarantor.
(c) The following is hereby waived: diligence presentment, demand of
payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first
against the Company, protest, notice and all demands whatsoever.
(d) This Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the
Indenture, and the Guaranteeing Subsidiary accepts all obligations of
a Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any Custodian,
Trustee, liquidator or other similar official acting in relation to
either the Company or the Guarantors, any amount paid by either to
the Trustee or such Holder, this Note Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed
hereby.
(g) As between the Guarantors, on the one hand, and the Holders and
the Trustee, on the other hand, (x) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article 6 of the
Indenture for the purposes of this Note Guarantee, notwithstanding
any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (y)
in the event of any declaration of acceleration of such obligations
as provided in Article 6 of the Indenture, such obligations (whether
or not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Note Guarantee.
(h) The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not
impair the rights of the Holders under the Guarantee.
(i) Pursuant to Section 11.03 of the Indenture, after giving effect
to any maximum amount and any other contingent and fixed liabilities
that are relevant under any applicable Bankruptcy or fraudulent
conveyance laws, and after giving effect to any collections from,
rights to receive contribution from or payments made by or on behalf
of any other Guarantor in respect of the obligations of such other
Guarantor under Article 11 of the Indenture, this new Note Guarantee
shall be limited to the maximum amount permissible such that the
obligations of such Guarantor under this Note Guarantee will not
constitute a fraudulent transfer or conveyance.
F-2
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that
the Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not consolidate with or merge
with or into (whether or not such Guarantor is the surviving Person) another
corporation, Person or entity whether or not affiliated with such Guarantor
unless:
(i) subject to Sections 11.05 and 11.06 of the Indenture, the Person
formed by or surviving any such consolidation or merger (if other
than a Guarantor or the Company) unconditionally assumes all the
obligations of such Guarantor, pursuant to a supplemental indenture
in form and substance reasonably satisfactory to the Trustee, under
the Notes, the Indenture and the Note Guarantee on the terms set
forth herein or therein; and
(ii) immediately after giving effect to such transaction, no Default
or Event of Default exists.
(b) In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Note Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of the Indenture to be
performed by the Guarantor, such successor corporation shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor corporation thereupon may cause to be
signed any or all of the Note Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Note Guarantees so issued shall in all
respects have the same legal rank and benefit under the Indenture as the Note
Guarantees theretofore and thereafter issued in accordance with the terms of
the Indenture as though all of such Note Guarantees had been issued at the
date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section 11.06 of
Article 11 of the Indenture, and notwithstanding clauses (a) and (b) above,
nothing contained in the Indenture or in any of the Notes shall prevent any
consolidation or merger of a Guarantor with or into the Company or another
Guarantor, or shall prevent any sale or conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Company or
another Guarantor.
5. RELEASES.
(a) In the event of a sale or other disposition of all of the assets
of any Guarantor, by way of merger, consolidation or otherwise, or a sale or
other disposition of all to the capital stock of any Guarantor, in each case
to a Person that is not (either before or after giving effect to such
transaction) a Restricted Subsidiary of the Company, then such Guarantor (in
the event of a sale or other disposition, by way of merger, consolidation or
otherwise, of all of the capital stock of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other disposition of all or
substantially all of the assets of such Guarantor) will be released and
relieved of any obligations under its Note Guarantee; provided that the Net
Proceeds of such sale or other disposition are applied in accordance with the
applicable provisions of the Indenture, including without limitation Section
4.10 of the Indenture. Upon delivery by the Company to the Trustee of an
Officers' Certificate and an Opinion of Counsel to the effect that such sale
or other disposition was made by the Company in accordance with the provisions
of the Indenture, including without limitation Section 4.10 of the Indenture,
the Trustee shall execute any
F-3
documents reasonably required in order to evidence the release of any
Guarantor from its obligations under its Note Guarantee.
(b) Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under the
Indenture as provided in Article 11 of the Indenture.
6. NO RECOURSE AGAINST OTHERS. No past, present or future member,
director, officer, employee, incorporator, stockholder or agent of the
Guaranteeing Subsidiary, as such, shall have any liability for any obligations
of the Company or any Guaranteeing Subsidiary under the Notes, any Note
Guarantees, the Indenture or this Supplemental Indenture 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. The waiver and release are part of the consideration for issuance
of the Notes. Such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
F-4
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, ____
[GUARANTEEING SUBSIDIARY]
By:________________________________________
Name:
Title:
SBI HOLDINGS, INC.
By:________________________________________
Name:
Title:
SIERRA BIOMEDICAL, INC.
By:________________________________________
Name:
Title:
SIERRA BIOMEDICAL SAN DIEGO, INC.
By:________________________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:________________________________________
Name:
Title:
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Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Issue Date:
SBI Holdings, Inc.
Sierra Biomedical, Inc.
Sierra Biomedical San Diego, Inc.
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