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▇▇▇▇ HOLDINGS, INC.
$112,500,000
12 1/4% SENIOR SUBORDINATED NOTES DUE 2005
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INDENTURE
DATED AS OF , 1999
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HSBC BANK USA
TRUSTEE
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CROSS REFERENCE TABLE
TRUST INDENTURE
ACT SECTION
INDENTURE SECTION
310 (a)(1) 8.10
(a)(2) 8.10
(a)(3) N/A
(a)(4) N/A
(a)(5) 8.10
(b) 8.10
(c) N/A
311 (a) 8.11
(b) 8.11
(c) N/A
312 (a) 2.05
(b) 12.03
(c) 12.03
313 (a) 11.02
(b)(i) 11.02
(b)(2) 8.06
(c) 8.06; 11.02
(d) 8.06
314 (a) 8.03; 11.02
(b) 11.03
(c)(1) 12.04
(c)(2) 12.04
(c)(3) N/A
(d) 11.02; 11.03
(e) 12.05
(f) N/A
315 (a) 8.01
(b) 8.05; 12.02
(c) 8.01
(d) 8.01
(e) 7.11
316 (a)(1)(A) 7.05
(a)(1)(B) 7.04
(a)(2) N/A
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(b) 7.07
317 (a)(1) 7.08
(a)(2) 7.09
(b) 2.04
318 (a) 12.01
(b) N/A
(c) 12.01
NOTE: This Cross-Reference Table shall not, for any purpose, be
deemed to be part of the Indenture.
TABLE OF CONTENTS
PAGE
RECITALS OF THE COMPANY
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02 OTHER DEFINITIONS. . . . . . . . . . . . . . . . . . . 15
Section 1.03 Incorporation by Reference of Trust Indenture Act. . . 15
Section 1.04 RULES OF CONSTRUCTION. . . . . . . . . . . . . . . . . 16
ARTICLE II
THE NOTES
Section 2.01 FORM AND DATING. . . . . . . . . . . . . . . . . . . . 16
Section 2.02 EXECUTION AND AUTHENTICATION . . . . . . . . . . . . . 16
Section 2.03 REGISTRAR AND PAYING AGENT . . . . . . . . . . . . . . 17
Section 2.04 PAYING AGENT TO HOLD MONEY IN TRUST. . . . . . . . . . 17
Section 2.05 LISTS OF HOLDERS . . . . . . . . . . . . . . . . . . . 18
Section 2.06 TRANSFER AND EXCHANGE. . . . . . . . . . . . . . . . . 18
Section 2.07 REPLACEMENT NOTES. . . . . . . . . . . . . . . . . . . 18
Section 2.08 OUTSTANDING NOTES. . . . . . . . . . . . . . . . . . . 19
Section 2.09 TEMPORARY NOTES. . . . . . . . . . . . . . . . . . . . 19
Section 2.10 CANCELLATION . . . . . . . . . . . . . . . . . . . . . 19
Section 2.11 DEFAULTED INTEREST . . . . . . . . . . . . . . . . . . 19
Section 2.12 CUSIP NUMBER . . . . . . . . . . . . . . . . . . . . . 20
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ARTICLE III
REDEMPTION
Section 3.01 NOTICES TO TRUSTEE . . . . . . . . . . . . . . . . . . 20
Section 3.02 SELECTION OF NOTES TO BE REDEEMED. . . . . . . . . . . 20
Section 3.03 NOTICE OF REDEMPTION . . . . . . . . . . . . . . . . . 21
Section 3.04 EFFECT OF NOTICE OF REDEMPTION . . . . . . . . . . . . 21
Section 3.05 DEPOSIT OF REDEMPTION PRICE. . . . . . . . . . . . . . 22
Section 3.06 NOTES REDEEMED IN PART . . . . . . . . . . . . . . . . 22
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ARTICLE IV
CHANGE OF CONTROL AND ENTERPRISE VALUATION EVENT
Section 4.01 CHANGE OF CONTROL AND ENTERPERISE VALUATION EVENT. . . 22
ARTICLE V
COVENANTS
Section 5.01 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST . . . . . . 24
Section 5.02 MAINTENANCE OF OFFICE OR AGENCY. . . . . . . . . . . . 25
Section 5.03 SEC REPORTS. . . . . . . . . . . . . . . . . . . . . . 25
Section 5.04 LIMITATION ON DEBT . . . . . . . . . . . . . . . . . . 25
Section 5.05 LIMITATION ON DEBT AND PREFERRED STOCK OF SUBSIDIARIES
OF ▇▇▇▇ . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.06 LIMITATION ON RESTRICTED PAYMENTS. . . . . . . . . . . 28
Section 5.07 LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM
SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . 31
Section 5.08 LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK . . 32
Section 5.09 LIMITATION ON AFFILIATE TRANSACTIONS . . . . . . . . . 33
Section 5.10 COMPLIANCE CERTIFICATES. . . . . . . . . . . . . . . . 34
Section 5.11 FURTHER INSTRUMENTS AND ACTS . . . . . . . . . . . . . 34
ARTICLE VI
SUCCESSORS
Section 6.01 WHEN THE COMPANY MAY MERGE OR TRANSFER ASSETS. . . . . 35
Section 6.02 SUCCESSOR COMPANY SUBSTITUTED. . . . . . . . . . . . . 35
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.01 EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . 36
Section 7.02 ACCELERATION . . . . . . . . . . . . . . . . . . . . . 37
Section 7.03 OTHER REMEDIES . . . . . . . . . . . . . . . . . . . . 38
Section 7.04 WAIVER OF PAST DEFAULTS. . . . . . . . . . . . . . . . 38
Section 7.05 CONTROL BY MAJORITY. . . . . . . . . . . . . . . . . . 38
Section 7.06 LIMITATION ON SUITS. . . . . . . . . . . . . . . . . . 38
Section 7.07 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PAYMENT. . . 39
Section 7.08 COLLECTION SUIT BY TRUSTEE . . . . . . . . . . . . . . 39
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Section 7.09 TRUSTEE MAY FILE PROOFS OF CLAIM . . . . . . . . . . . 39
Section 7.10 PRIORITIES . . . . . . . . . . . . . . . . . . . . . . 40
Section 7.11 UNDERTAKING FOR COSTS. . . . . . . . . . . . . . . . . 40
Section 7.12 WAIVER OF STAY, EXTENSION AND USURY LAWS . . . . . . . 40
ARTICLE VIII
TRUSTEE
Section 8.01 DUTIES OF TRUSTEE. . . . . . . . . . . . . . . . . . . 41
Section 8.02 RIGHTS OF TRUSTEE. . . . . . . . . . . . . . . . . . . 42
Section 8.03 INDIVIDUAL RIGHTS OF TRUSTEE . . . . . . . . . . . . . 43
Section 8.04 TRUSTEE'S DISCLAIMER . . . . . . . . . . . . . . . . . 43
Section 8.05 NOTICE OF DEFAULT. . . . . . . . . . . . . . . . . . . 43
Section 8.06 REPORTS BY TRUSTEE TO HOLDERS. . . . . . . . . . . . . 43
Section 8.07 COMPENSATION AND INDEMNITY . . . . . . . . . . . . . . 44
Section 8.08 REPLACEMENT OF TRUSTEE . . . . . . . . . . . . . . . . 44
Section 8.09 SUCCESSOR TRUSTEE BY MERGER, ETC . . . . . . . . . . . 45
Section 8.10 ELIGIBILITY: DISQUALIFICATION. . . . . . . . . . . . . 46
Section 8.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY. 46
Section 8.12 MAY HOLD SECURITIES. . . . . . . . . . . . . . . . . . 46
ARTICLE IX
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01 DISCHARGE OF LIABILITY ON NOTES; DEFEASANCE. . . . . . 46
Section 9.02 CONDITIONS TO DEFEASANCE . . . . . . . . . . . . . . . 47
Section 9.03 APPLICATION OF TRUST MONEY . . . . . . . . . . . . . . 49
Section 9.04 REPAYMENT TO THE COMPANY . . . . . . . . . . . . . . . 49
Section 9.05 INDEMNITY FOR GOVERNMENT OBLIGATIONS . . . . . . . . . 49
Section 9.06 REINSTATEMENT. . . . . . . . . . . . . . . . . . . . . 49
ARTICLE X
AMENDMENT, SUPPLEMENT AND WAIVER
Section 10.01 WITHOUT CONSENT OF HOLDERS . . . . . . . . . . . . . . 49
Section 10.02 WITH CONSENT OF HOLDERS. . . . . . . . . . . . . . . . 50
Section 10.03 COMPLIANCE WITH TRUST INDENTURE ACT. . . . . . . . . . 52
Section 10.04 REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. . . . . 52
Section 10.05 NOTATION ON OR EXCHANGE OF NOTES . . . . . . . . . . . 52
Section 10.06 TRUSTEE TO SIGN AMENDMENTS, ETC. . . . . . . . . . . . 52
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Section 10.07 PAYMENT FOR CONSENTS . . . . . . . . . . . . . . . . . 52
ARTICLE XI
SUBORDINATION OF NOTES
Section 11.01 AGREEMENT TO SUBORDINATE . . . . . . . . . . . . . . . 53
Section 11.02 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION; ETC . . . . 53
Section 11.03 NO PAYMENT WHEN SENIOR DEBT IN DEFAULT . . . . . . . . 54
Section 11.04 ACCELERATION OF PAYMENT OF NOTES . . . . . . . . . . . 55
Section 11.05 PAYMENT PERMITTED IF NO DEFAULT. . . . . . . . . . . . 55
Section 11.06 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT. . . . 55
Section 11.07 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. . . . . . 56
Section 11.08 TRUSTEE TO EFFECTUATE SUBORDINATION. . . . . . . . . . 56
Section 11.09 NO WAIVER OF SUBORDINATION PROVISIONS. . . . . . . . . 56
Section 11.10 NOTICE TO TRUSTEE. . . . . . . . . . . . . . . . . . . 57
Section 11.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGE. . . . . . . . . . . . . . . . . . . . 57
Section 11.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT . . . 58
Section 11.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF TRUSTEE'S RIGHTS . . . . . . . . . . . 58
Section 11.14 ARTICLE XI APPLICABLE TO PAYING AGENTS . . . . . . . . 58
Section 11.15 TRUST MONEYS NOT SUBORDINATED. . . . . . . . . . . . . 58
Section 11.16 RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION
PROVISIONS . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.17 DISTRIBUTION OR NOTICE TO REPRESENTATIVE . . . . . . . 59
Section 11.18 ARTICLE XI NOT TO PREVENT EVENTS OF DEFAULT OR LIMIT
RIGHT TO ACCELERATE. . . . . . . . . . . . . . . . . . 59
ARTICLE XII
MISCELLANEOUS
Section 12.01 TRUST INDENTURE ACT CONTROLS . . . . . . . . . . . . . 59
Section 12.02 NOTICES. . . . . . . . . . . . . . . . . . . . . . . . 59
Section 12.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS. . . . . . 60
Section 12.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT . . 60
Section 12.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. . . . . 60
Section 12.06 RULES BY TRUSTEE AND AGENTS. . . . . . . . . . . . . . 61
Section 12.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS,
EMPLOYEES, INCORPORATORS AND STOCKHOLDERS . . . . . . 61
Section 12.08 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . 61
Section 12.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. . . . . 61
Section 12.10 SUCCESSORS . . . . . . . . . . . . . . . . . . . . . . 61
Section 12.11 SEVERABILILY . . . . . . . . . . . . . . . . . . . . . 62
Section 12.12 COUNTERPART ORIGINALS. . . . . . . . . . . . . . . . . 62
Section 12.13 TABLE OF CONTENTS, HEADINGS, ETC . . . . . . . . . . . 62
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EXHIBIT A -- Form of Note; Form of Trustee's Certificate of Authentication
vi
INDENTURE, dated as of October 15, 1999, between ▇▇▇▇ Holdings, Inc.
("the COMPANY"), a corporation duly organized and existing under the laws of
the State of Delaware, and HSBC Bank USA, a New York banking corporation, as
trustee (the "TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of up to $112,500,000 aggregate
principal amount of the Company's 12 1/4% Senior Subordinated Notes Due 2005
(the "NOTES") issuable as provided in this Indenture. All things necessary to
make this Indenture a valid agreement of the Company, in accordance with its
terms, have been done, and the Company has done all things necessary to make
the Notes, when executed by the Company and authenticated and delivered by
the Trustee hereunder and duly issued by the Company, the valid obligations
of the Company as hereinafter provided.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes
by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Notes, as follows:
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1. DEFINITIONS.
"ADDITIONAL ASSETS" means (i) any property or assets (other than Debt
and Capital Stock) used or useful in a Related Business; (ii) the Capital
Stock of a Person that becomes a Subsidiary as a result of the acquisition of
such Capital Stock by the Company or another Subsidiary or (iii) Capital
Stock constituting a minority interest in any Person that at such time is a
Subsidiary; PROVIDED, HOWEVER, that any such Subsidiary described in clause
(ii) or (iii) above is primarily engaged in a Related Business.
"AFFILIATE" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Persons means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing. For purposes of the provisions described in Sections 5.06, 5.08
and 5.09 only, "Affiliate" shall also mean any beneficial owner of Capital
Stock representing 10% or more of the total voting power of the Voting Stock
(on a fully diluted basis) of the Company or of rights or warrants to
purchase such Capital Stock (whether or not currently exercisable) and any
Person who would be an Affiliate of any such beneficial owner pursuant to the
first sentence hereof. Notwithstanding the foregoing, none of the Banks shall
be deemed to be an Affiliate of the Company and its Subsidiaries solely as a
result of the security
interests held by the Banks in the Capital Stock of the Company's
Subsidiaries pursuant to the Credit Agreement.
"AGENT" means any Registrar, Paying Agent or co-registrar.
"ASSET DISPOSITION" means any sale, transfer or other disposition (or
series of related sales, transfers or dispositions) by the Company or any
Subsidiary, including any disposition by means of a merger, consolidation or
similar transaction (each referred to for the purposes of this definition as
a "disposition"), of (i) any shares of Capital Stock of a Subsidiary (other
than directors' qualifying shares or shares required by applicable law to be
held by a Person other than the Company or a Subsidiary), (ii) all or
substantially all the assets of any division or line of business of the
Company or any Subsidiary or (iii) any other assets of the Company or any
Subsidiary outside of the ordinary course of business of the Company or such
Subsidiary (other than, in the case of (i), (ii) and (iii) above, (v) any
disposition, or related series of dispositions, of assets with an aggregate
fair market value of $1 million or less for each such disposition or related
series of dispositions, (w) dispositions permitted under Article VI, (x) a
disposition by a Subsidiary to the Company or a Subsidiary to a Wholly Owned
Subsidiary, [(y) sales of Customer Notes to third parties] and (z) for
purposes of the covenant described in Section 5.08 only, a disposition that
constitutes a Restricted Payment permitted by the covenant described under
Section 5.06.
"AVERAGE LIFE" means, as of the date of determination, with respect to
any Debt or Preferred Stock, the quotient obtained by dividing (i) the sum of
the products of numbers of years from the date of determination to the dates
of each successive scheduled principal payment of such Debt or redemption or
similar payment with respect to such Preferred Stock multiplied by the amount
of such payment by (ii) the sum of all such payments.
"BANKS" means the lenders under the Credit Facility.
"BANKRUPTCY LAW" means the U.S. Bankruptcy Code, 11 U.S.C. Section
101, et. seq., or any similar federal or state law for the relief of debtors.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"BUSINESS DAY" means each day which is not a Legal Holiday.
"CAPITAL LEASE OBLIGATIONS" of any Person means an obligation that is
required to be classified and accounted for as a capital lease on the face of
the balance sheet of such Person prepared in accordance with GAAP, and the
amount of Debt represented by such obligation shall be the capitalized amount
of such obligation determined in accordance with GAAP; and the Stated
Maturity thereof shall be the date of the last payment of rent or any other
amount due under such lease prior to the first date upon which such lease may
be terminated by the lessee without payment of a penalty.
2
"CAPITAL STOCK" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of
or interests in such Person (however designated) or the equity of such
Person, including any Preferred Stock, but excluding any debt securities
convertible or exchangeable into such equity.
"CASH EQUIVALENTS" means (i) obligations issued or unconditionally
guaranteed by the United States of America or any agency thereof, or
obligations issued by any agency or instrumentality thereof and backed by the
full faith and credit of the United States of America, (ii) commercial paper
rated the highest grade by ▇▇▇▇▇'▇ Investors Service, Inc. and Standard &
Poor's Ratings Group and maturing not more than one year from the date of
creation thereof, (iii) time deposits with, and certificates of deposit and
banker's acceptances issued by, any bank having capital surplus and undivided
profits aggregating at least $500 million and maturing not more than one year
from the date of creation thereof, (iv) repurchase agreements that are
secured by a perfected security interest in an obligation described in clause
(i) and are with any bank described in clause (iii), (v) shares of any money
market mutual fund that (a) has at least 95% of its assets invested
continuously in the types of investments referred to in clauses (i) and (ii)
above, (b) has net assets of not less than $500 million, and (c) has the
highest rating obtainable from either Standard & Poor's Ratings Group or
▇▇▇▇▇'▇ Investors Service, Inc. and (vi) readily marketable direct
obligations issued by any state of the United States of America or any
political subdivision thereof having one of the two highest rating categories
obtainable from either ▇▇▇▇▇'▇ Investors Service, Inc. or Standard & Poor's
Ratings Group.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONSOLIDATED COVERAGE RATIO" as of any date of determination means the
ratio of (i) the aggregate amount of EBITDA for the period of the most recent
four consecutive fiscal quarters ending at least 45 days prior to the date of
such determination to (ii) Consolidated Interest Expense for such four fiscal
quarters; PROVIDED, HOWEVER, that (1) if the Company or any Subsidiary has
Incurred any Debt since the beginning of such period that remains outstanding
(other than revolving credit Debt Incurred under the Credit Facility with
respect to which the related commitment remains outstanding) or if the
transaction giving rise to the need to calculate the Consolidated Coverage
Ratio is an Incurrence of Debt, or both, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving effect on a pro
forma basis to such Debt as if such Debt had been Incurred on the first day
of such period and the discharge of any other Debt repaid, repurchased,
defeased or otherwise discharged with the proceeds of such new Debt as if
such discharge had occurred on the first day of such period, (2) if since the
beginning of such period any Debt of the Company or any Subsidiary has been
repaid, repurchased, defeased or otherwise discharged or if the transaction
giving rise to the need to calculate the Consolidated Coverage Ratio will
include any such repayment, repurchase, defeasement or discharge not
otherwise covered in clause (1) above, or both (in either case other than
revolving credit Debt Incurred pursuant to the Credit Facility or any similar
arrangement unless such revolving credit Debt has been permanently repaid and
has not been replaced), Consolidated Interest Expense for such period shall
be calculated, after giving effect thereto on a pro forma basis, as if such
Debt had been repaid, repurchased, defeased or otherwise discharged on the
first day of such period, (3) if since the beginning of such period the
Company or any Subsidiary shall have made any Asset Disposition, the EBITDA
for such period shall be reduced by an amount equal to the EBITDA (if
positive) directly attributable to the assets which are the
3
subject of such Asset Disposition for such period, or increased by an amount
equal to the EBITDA (if negative), directly attributable thereto for such period
and Consolidated Interest Expense for such period shall be reduced by an amount
equal to the Consolidated Interest Expense directly attributable to any Debt of
the Company or any Subsidiary repaid, repurchased, defeased or otherwise
discharged with respect to the Company and its continuing Subsidiaries in
connection with such Asset Disposition for such period (or, if the Capital Stock
of any Subsidiary is sold, the Consolidated Interest Expense for such period
directly attributable to the Debt of such Subsidiary to the extent the Company
and its continuing Subsidiaries are no longer liable for such Debt after such
sale), (4) if since the beginning of such period the Company or any Subsidiary
(by merger or otherwise) shall have made an Investment in any Subsidiary (or any
Person which becomes a Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction requiring a
calculation to be made hereunder, which constitutes all or substantially all of
an operating unit of a business, EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving pro forma effect thereto (including
the Incurrence of any Debt) as if such Investment or acquisition occurred on the
first day of such period and (5) if since the beginning of such period any
Person (that subsequently became a Subsidiary or was merged with or into the
Company or any Subsidiary since the beginning of such period) shall have made
any Asset Disposition, any Investment or acquisition of assets that would have
required an adjustment pursuant to clause (3) or (4) above if made by the
Company or a Subsidiary during such period, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto as if such Asset Disposition, Investment or acquisition occurred on the
first day of such period. For purposes of this definition, whenever pro forma
effect is to be given to an acquisition of assets, the amount of income or
earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Debt Incurred in connection therewith, the pro forma
calculations shall be determined in good faith by a responsible financial or
accounting Officer of the Company. If any Debt bears a floating rate of interest
and is being given pro forma effect, the interest of such Debt shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Debt if such Interest Rate Agreement has a
remaining term in excess of 12 months).
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the total
interest expense of the Company and its consolidated Subsidiaries, plus, to
the extent not included in such total interest expense, and to the extent
incurred by the Company or its Subsidiaries, (i) interest expense
attributable to Capital Lease Obligations, (ii) amortization of debt
discount, (iii) capitalized interest, (iv) non-cash interest expenses, (v)
commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers' acceptance financing, (vi) net costs
associated with Interest Rate Agreements (including amortization of fees),
(vii) Preferred Stock dividends in respect of all Preferred Stock (except
dividends payable solely in shares of Capital Stock of the Company (other
than Disqualified Stock of the Company)) held by Persons other than the
Company or a Wholly Owned Subsidiary, (viii) interest incurred in connection
with Investments in discontinued operations, (ix) interest accruing on any
Debt of any other Person to the extent such Debt is Guaranteed by the Company
or any Subsidiary and (x) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest or fees to any Person (other than the
Company) in connection with Debt Incurred by such plan or trust; PROVIDED,
HOWEVER, that there shall not be included in such Consolidated Interest
Expense any
4
amount of Interest Expense of any Subsidiary if the net income of such
Subsidiary is excluded in the calculation of Consolidated Net Income (but
only in the same proportion as such net income is excluded) because the
declaration or payment of dividends or similar distributions by such
Subsidiary of such net income is not at the time permitted by the operation
of the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to such Subsidiary.
"CONSOLIDATED NET INCOME" means, for any period, the net income of the
Company and its consolidated Subsidiaries; PROVIDED, HOWEVER, that there
shall not be included in such Consolidated Net Income: (i) any net income of
any Person if such Person is not a Subsidiary, except that (A) subject to the
exclusion contained in clause (iv) below, the Company's equity in the net
income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a Subsidiary
as a dividend or other distribution (subject, in the case of a dividend or
other distribution paid to a Subsidiary, to the limitations contained in
clause (iii) below) and (B) the Company's equity in a net loss of any such
Person for such period shall be included in determining such Consolidated Net
Income to the extent of any cash actually contributed by the Company or a
Subsidiary to such Person during such Period; (ii) any net income (or loss)
of any Person acquired by the Company or a Subsidiary in a pooling of
interests transaction for any period prior to the date of such acquisition;
(iii) any net income of any Subsidiary if such Subsidiary is subject to
restrictions, directly or indirectly, on the payment of dividends or the
making of distributions by such Subsidiary, directly or indirectly, to the
Company, except that (A) subject to the exclusion contained in clause (iv)
below, the Company's equity in the net income of any such Subsidiary for such
period shall be included in such Consolidated Net Income up to the aggregate
amount of cash actually distributed by such Subsidiary during such period to
the Company or another Subsidiary as a dividend or other distribution
(subject, in the case of a dividend or other distribution paid to another
Subsidiary, to the limitation contained in this clause) and (B) the Company's
equity in a net loss of any such Subsidiary for such period shall be included
in determining such Consolidated Net Income to the extent of any cash
actually contributed by the Company or a Subsidiary to such Person during
such Period; (iv) any gain or loss net of tax realized upon the sale or other
disposition of any assets of the Company or its consolidated Subsidiaries
(including pursuant to any sale-and-leaseback arrangement) which is not sold
or otherwise disposed of in the ordinary course of business and any gain or
loss net of tax realized upon the sale or other disposition of any Capital
Stock of any Person; (v) extraordinary gains or losses net of tax; and (vi)
the cumulative effect of a change in accounting principles, net of tax.
Notwithstanding the foregoing, for the purposes of Section 5.06 only, there
shall be excluded from Consolidated Net Income any dividends, repayments of
loans or advances or other transfers of assets from a Subsidiary to the
extent such dividends, repayments or transfers increase the amount of
Restricted Payments permitted under such covenant pursuant to clause
(a)(3)(D) thereof.
"CONSOLIDATED NET WORTH" means the total of the amounts shown on the
balance sheet of the Company and its consolidated Subsidiaries, determined on
a consolidated basis in accordance with GAAP, as of the end of the most
recent fiscal quarter of the Company ending at least 45 days prior to the
taking of any action for the purpose of which the determination is being
made, as (i) the par or stated value of all outstanding Capital Stock of the
Company plus (ii) paid-in capital or capital
5
surplus relating to such Capital Stock plus (iii) any retained earnings or
earned surplus less (A) any accumulated deficit and (B) any amounts
attributable to Disqualified Stock.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the address of the
Trustee specified in Section 12.02 or such other address as to which the
Trustee may give notice to the Company.
"CREDIT FACILITY" means the credit facility consisting of the Tranche
A, Tranche B and term facilities made pursuant to that certain Second Amended
and Restated Credit Agreement, dated as of October ___, 1999, among ▇▇▇▇,
certain Subsidiaries of ▇▇▇▇, Bankers Trust Company as administrative agent,
the co-agents named therein and the lenders named therein, including (i) any
related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as amended, modified,
renewed, refunded, replaced or refinanced from time to time, in whole or in
part, and (ii) any credit agreements, notes, guarantees, collateral
documents, instruments and agreements executed in connection with any such
amendment, modification, renewal, refunding, replacement or refinancing and
any credit facilities or agreements that replace, refund or refinance any
part of the loans, credit facilities or commitments thereunder (subject to
Sections 5.04 and 5.05), including such replacement, refunding or refinancing
facility that increased the amount borrowable thereunder, alters the maturity
date thereof or alters the allocation of term loans and revolving loans.
"CREDIT FACILITY GUARANTY" means the Second Amended and Restated
Guaranty dated as of November __, 1999 between the Company and Bankers Trust
Company, as agent.
"CURRENCY AGREEMENT" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement to which such
Person is a party or a beneficiary.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
["CUSTOMER NOTES" means notes receivable, on terms consistent with the
past practices of the Company and its Subsidiaries and with prevailing
industry practices, issued in connection with customer financing provided to
purchasers of the Company's and its Subsidiaries' products and secured by a
valid and enforceable first priority Lien on the products being purchased.]
["CUSTOMER NOTES GUARANTEES" means Guarantees by the Company and its
Subsidiaries, on terms consistent with the past practices of the Company and
its Subsidiaries and with prevailing industry practices, of all or a portion
of Customer Notes issued by the Company or its Subsidiaries and sold to third
parties, or of all or a portion of customer notes or other financing provided
by third parties to purchasers of the Company's and its Subsidiaries'
products; provided, however, that "Customer Notes Guarantees" shall not
include the provision of letters of credit in respect of financing provided
by a third party to purchasers of the Company's and its Subsidiaries'
products to the extent such letters of credit are Incurred under the
Revolving Credit Facility.]
"DEBT" of any Person means, without duplication, (i) the
principal of and premium (if any) in respect of (A) debt of such Person for
money borrowed and (B) debt evidenced by notes, debentures, bonds or other
similar instruments for the payment of which such Person is responsible or
liable; (ii) all Capital Lease Obligations of such Person; (iii) all obligations
of such Person issued or assumed as the deferred purchase price of property, all
conditional sale obligations of such Person
6
and all obligations of such Person under any title retention agreement (but
excluding (x) trade accounts payable and other current trade liabilities
arising in the ordinary course of business and payable in accordance with
customary practices and (y) deferred purchase price obligations where payment
is due within six months of delivery); (iv) all obligations of such Person
for the reimbursement of any obligor on any letter of credit, banker's
acceptance, or other similar credit transaction (other than obligations with
respect to letters of credit and related Hedging Obligations securing
obligations (other than obligations described in (i) through (iii) above)
entered into in the ordinary course of business of such Person to the extent
such letters of credit are not drawn upon or, if and to the extent drawn
upon, such drawing is reimbursed no later than the third Business Day
following receipt by such Person of a demand for reimbursement following
payment on the letter of credit); (v) the amount of all obligations of such
Person with respect to the redemption, repayment or other repurchase of any
Disqualified Stock or, with respect to any Subsidiary of such Person, any
Preferred Stock (but excluding, in each case, any accrued dividends); (vi)
all Hedging Obligations of such Person (other than Hedging Obligations
excluded pursuant to clause (iv) above); (vii) all obligations of the type
referred to in clauses (i) through (v) of other Persons and all dividends of
other Persons for the payment of which, in either case, such Person is
responsible or liable, directly or indirectly, as obligor, guarantor or
otherwise, including by means of any Guarantee; and (viii) all obligations of
the type referred to in clauses (i) through (vi) of other Persons secured by
any Lien on any property or asset of such Person (whether or not such
obligation is assumed by such Person), the amount of such obligation being
deemed to be the lesser of the value of such property or assets or the amount
of the obligation so secured. The amount of Debt of any Person at any date
shall be the outstanding balance of all obligations as described above and
the maximum liability, upon the occurrence of the contingency giving rise to
the obligation, of any contingent obligations at such date; PROVIDED,
HOWEVER, that the amount outstanding at any time of any Debt Incurred with
original issue discount is the face amount of such Debt less the remaining
unamortized portion of the original issue discount of such Debt at such time
as determined in conformity with GAAP.
"DEEMED ASSET VALUE" means 75% of the fair market value of assets
(other than cash) received by the Company from the issuance or sale of its
Capital Stock or as a capital contribution, in either case as determined in
good faith by the Board of Directors; PROVIDED, HOWEVER, that such
determination shall be confirmed by a nationally recognized investment
banking firm or appraisal firm in the event that the value determined by the
Board of Directors exceeds $10 million.
"DEFAULT" means any event that is, or after notice or with the passage
of time or both would be, an Event of Default.
"DISQUALIFIED STOCK" means, with respect to any Person, any
Capital Stock which 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 (i) matures or is mandatorily redeemable pursuant to a sinking fund
obligation or otherwise, (ii) is convertible or exchangeable for Debt or
Disqualified Stock or (iii) is redeemable at the option of the Holder thereof,
in whole or in part, in each case on or prior to the first anniversary of the
Stated Maturity of the Notes; PROVIDED, HOWEVER, that any Capital Stock that
would not constitute Disqualified Stock but for provisions thereof giving
Holders thereof the right to require such Person to repurchase or redeem such
Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the first anniversary of the Stated Maturity
7
of the Notes shall not constitute Disqualified Stock if the "asset sale" or
"change of control" provisions applicable to such Capital Stock are not more
favorable to the holders of such Capital Stock than the provisions described
under Section 5.08 and Article IV.
"EBITDA" for any period means the sum of Consolidated Net Income, plus
Consolidated Interest Expense plus the following to the extent deducted in
calculating such Consolidated Net Income: (a) all income tax expense of the
Company, (b) depreciation expense, (c) amortization expense and (d) all other
non-cash items reducing Consolidated Net Income (other than any non-cash item
to the extent it represents an accrual of, or a reserve for, cash
disbursements for any subsequent period prior to the Stated Maturity of the
Notes) and less, to the extent added in calculating Consolidated Net Income,
non-cash items (other than any non-cash item to the extent it represents an
accrual for cash receipts reasonably expected to be received within 12 months
after the date of such accrual), in each case for such period.
Notwithstanding the foregoing, the provision for taxes based on the income or
profits of, and the depreciation and amortization of, a Subsidiary of the
Company shall be added to Consolidated Net Income to compute EBITDA only to
the extent (and in the same proportion) that the net income of such
Subsidiary was included in calculating Consolidated Net Income and only if a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Subsidiary without prior approval other
than for the board of directors of such Subsidiary (that has not been
obtained), pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to such Subsidiary or its stockholders.
"ENTERPRISE VALUATION" means the aggregate Fair Market Value of the
Company or ▇▇▇▇ as of the date of the occurrence of an Enterprise Valuation
Event.
"ENTERPRISE VALUATION EVENT" means: (i) any Change of Control
consisting of or resulting from one or more transactions, (ii) a Public
Equity Offering or (iii) an offering of common stock of the Company or ▇▇▇▇
in a transaction or series of transactions exempt from registration under the
Securities Act, in each case wherein the aggregate consideration therefor has
a value in excess of $600,000,000 or which fairly reflects an Enterprise
Valuation for the Company and its Subsidiaries in excess of $600,000,000.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FAIR MARKET VALUE" means with respect to an asset or a business, the
price at which such asset or business would change hands between a willing
buyer and willing seller, neither being under compulsion to buy or sell and
both having reasonable knowledge of all relevant facts as of the applicable
valuation date.
"FOREIGN SUBSIDIARY" means a subsidiary that is organized under the
laws of any country other than the U.S. and substantially all the assets of
which are located outside of the U.S.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set
forth (i) in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants, (ii)
statements and pronouncements of the Financial Accounting Standards Board,
(iii) in such other statements by such other entity as approved by a
significant segment of the accounting
8
profession, and (iv) the rules and regulations of the SEC governing the
inclusion of financial statements (including pro forma financial statements)
in periodic reports required to be filed pursuant to Section 13 of the
Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC.
"▇▇▇▇" means ▇▇▇▇ Graphic Systems, Inc., a Delaware corporation or any
successor thereof.
"GUARANTEE" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Debt or other obligation of
any Person and any obligation, direct or indirect, contingent or otherwise,
of such Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation of such Person (whether
arising by virtue of partnership arrangements, or by agreement to keep-well,
to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement conditions or otherwise); or (ii) entered into
for purposes of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against
loss in respect thereof (in whole or in part); PROVIDED, HOWEVER, that the
term "Guarantee" shall not include endorsements for collection or deposit in
the ordinary course of busine Sections The term "Guarantee" used as a verb
shall have a corresponding meaning. The term "Guarantor" shall mean any
Person guaranteeing any obligation.
"HEDGING OBLIGATIONS" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is
registered on the Registrar's books.
"INCUR" means issue, assume, Guarantee, incur or otherwise become
liable for; PROVIDED, HOWEVER, that any Debt or Capital Stock of a Person
existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by
such Subsidiary at the time it becomes a Subsidiary. The term "Incurrence"
when used as a noun shall have a correlative meaning. The accretion of
principal of a non-interest bearing or other discount security shall be
deemed to be the Incurrence of Debt.
"INDENTURE" means this Indenture, as amended, supplemented or otherwise
modified from time to time in accordance with the terms hereof.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement or other financial agreement or arrangement
designed to protect the Company or any Subsidiary against fluctuations in
interest rates.
"INVESTMENT" in any Person means any loan or advance (other than
advances to customers in the ordinary course of business on commercially
reasonable terms that are recorded as accounts receivable on the balance
sheet of such Person) to, any acquisition of Capital Stock, equity interest,
obligation or other security of, or capital contribution or other investment
in, or any other credit extension to (including by way of Guarantee of any
Debt of), such Person.
"ISSUE DATE" means the date on which the Notes are originally issued.
9
"JOINT VENTURE CONTRACT" means that certain Joint Venture Contract,
dated October 29, 1993, between Rockwell Graphic Systems, Inc. and Shanghai
Printing & Packaging Machinery Corp., as in effect on ___________________.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment we authorized
by law, regulation or executive order to remain closed. If a payment date is
a Legal Holiday, 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.
"LIEN" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"NET AVAILABLE CASH" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only
as and when received, but excluding any other consideration received in the
form of assumption by the acquiring Person of Debt or other obligations
relating to such properties or assets that are the subject of such Asset
Disposition or received in any other noncash form) therefrom, in each case
net of (i) all legal, title and recording expenses, commissions and other
fees and expenses incurred, and all Federal, state, provincial, foreign and
local taxes required to be accrued as a liability under GAAP, as a
consequence of such Asset Disposition; (ii) all payments made on any Debt
which is secured by any assets subject to such Asset Disposition, in
accordance with the terms of any Lien upon or other security agreement of any
kind with respect to such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by applicable law be
repaid out of the proceeds from such Asset Disposition; (iii) all
distributions and other payments required to be made to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset
Disposition; and (iv) the deduction of appropriate amounts provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the property or other assets disposed in such Asset
Disposition and retained by the Company or any Subsidiary after such Asset
Disposition.
"NET CASH PROCEEDS" means with respect to any issuance or sale of
Capital Stock, the cash proceeds (including cash equivalents) of such
issuance or sale net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant
and other fees actually incurred in connection with such issuance or sale and
net of taxes paid or payable as a result thereof.
"NOTE REGISTER" means the register of the Notes and the transfer and
exchange of the Notes as provided in Section 2.03 of this Indenture.
"NOTES" has the meaning set forth in the first recital.
"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, Controller, Secretary or any
Vice-President of such Person.
10
"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, principal financial officer, treasurer or principal
accounting officer of the Company.
"OPINION OF COUNSEL" means a written opinion from legal counsel, who
may be an employee of or counsel to the Company.
"PERMITTED HOLDERS" means Stonington and its Affiliates.
"PERMITTED INVESTMENT" means (A) an Investment by the Company or any
Subsidiary in (i) the Company or a Wholly Owned Subsidiary or a Person that
will, upon the making of such Investment, become a Wholly Owned Subsidiary;
(ii) another Person if as a result of, and contemporaneously with, such
Investment such other Person is merged or consolidated with or into, or
transfers or conveys all or substantially all its assets to, the Company or a
Wholly Owned Subsidiary; (iii) Temporary Cash Investments; (iv) receivables
owing to the Company or any Subsidiary if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms; (v) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as
expenses for accounting purposes, that are made in the ordinary course of
business; (vi) loans or advances to employees, officers or directors made in
the ordinary course of business consistent with past practices of the Company
or a Subsidiary and that do not in the aggregate exceed [$___ million] at any
time; (vii) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Company or any
Subsidiary or in satisfaction of judgments; and (viii) any Person to the
extent such Investment represents the non-cash portion of the consideration
received for an Asset Disposition as permitted pursuant to the covenant
described under Section 5.08, (B) any Investment by the Company in the
Permitted Joint Venture at the times and in the amounts and manner required
by the Joint Venture Contract and (C) Customer Notes issued following the
Issue Date by the Company and its Subsidiaries; provided that the amount of
Investments made pursuant to Customer Notes following the Issue Date, in the
aggregate, at any one time outstanding may not exceed $30 million less the
amount of Customer Notes Guarantees Incurred following the Issue Date then
outstanding pursuant to Section 5.04(b)(4) and 5.05(i).
"PERMITTED JOINT VENTURE" means Shanghai Rockwell Graphic Systems Co.,
Ltd., a joint venture formed by the Company and Shanghai Printing & Packaging
Machinery Corp. pursuant to the Joint Venture Contract.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"PREFERRED STOCK" means, as applied to the Capital Stock of any
corporation, Capital Stock of any class or classes (however designated) which
is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"PRINCIPAL" of a Note means the principal of the Note plus the premium,
if any, payable on the Note which is due or overdue or is to become due at
the relevant time.
11
"PUBLIC EQUITY OFFERING" means a primary public offering of any class
of common stock of the Company or ▇▇▇▇ pursuant to an effective registration
statement under the Securities Act.
"PUBLIC MARKET" means any time after (x) a Public Equity Offering has
been consummated, and (y) at least 15% of the total issued and outstanding
common stock of the Company or ▇▇▇▇, as the case may be, has been distributed
by means of an effective registration statement under the Securities Act or
sales pursuant to Rule 144 under the Securities Act.
"REFINANCE" means, with respect to any Debt, to refinance, extend,
renew, refund, repay, prepay, redeem, defease or retire, or to issue other
Debt in exchange or replacement for, such indebtedne SS. "Refinanced"
and "Refinancing" shall have correlative meanings.
"REFINANCING DEBT" means Debt that Refinances any Debt of the Company
or any Subsidiary existing on the Issue Date or Incurred in compliance with
this Indenture, including Debt that Refinances Refinancing Debt; PROVIDED,
HOWEVER, that (i) such Refinancing Debt has a Stated Maturity no earlier than
the Stated Maturity of the Debt being Refinanced; (ii) such Refinancing Debt
has an Average Life at the time such Refinancing Debt is Incurred that is
equal to or greater than the Average Life of the Debt being Refinanced; (iii)
such Refinancing Debt has an aggregate principal amount (or if Incurred with
original issue discount, an aggregate issue price) that is equal to or less
than the aggregate principal amount (or if Incurred with original issue
discount, the aggregate accreted value) then outstanding or committed (plus
fees and expenses, including any premium and defeasance costs) under the Debt
being Refinanced; and (iv) with respect to any Refinancing Debt of Debt other
than Senior Debt, such Refinancing Debt shall rank no more senior, and shall
be at least as subordinated, in right of payment to the Notes as the Debt
being so extended, renewed, refunded or refinanced; PROVIDED, FURTHER,
HOWEVER, that Refinancing Debt shall not include Debt of a Subsidiary that
Refinances Debt of the Company.
"RELATED BUSINESS" means the business of the Company and its
Subsidiaries on the Issue Date and any business related, ancillary or
complementary to the businesses of the Company and its Subsidiaries on the
Issue Date.
"REPRESENTATIVE" means any trustee, agent or representative (if any)
for an issue of Senior Debt of the Company.
"RESPONSIBLE OFFICER" means, when used with respect to the Trustee, any
officer within the Corporate Trust Office of the Trustee (or any successor
group of the Trustee) with direct responsibility for the administration of
the Indenture and also means with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his or
her knowledge and familiarity with the particular subject.
"RESTRICTED PAYMENT" with respect to any Person means (i) the
declaration or payment of any dividends or any other distributions of any
sort in respect of its Capital Stock (including any payment in connection
with any merger or consolidation involving such Person) or similar payment to
the direct or indirect Holders of its Capital Stock (other than (x) dividends
or distributions payable solely in its Capital Stock (other than Disqualified
Stock) or rights to acquire its Capital Stock (other than Disqualified
Stock), (y) dividends or distributions payable solely to the Company or a
Subsidiary, and (z) pro rata dividends or other distributions made by a
Subsidiary that is not a Wholly Owned Subsidiary to minority stockholders (or
owners of an equivalent interest in
12
the case of a Subsidiary that is an entity other than a corporation)), (ii)
the purchase, redemption or other acquisition or retirement for value of any
Capital Stock of the Company held by any Person or of any Capital Stock of a
Subsidiary held by any Affiliate of the Company (other than a Subsidiary),
including the exercise of any option to exchange any Capital Stock (other
than into Capital Stock of the Company that is not Disqualified Stock), (iii)
the purchase, repurchase, redemption, defeasance or other acquisition or
retirement for value, prior to scheduled maturity, scheduled repayment or
scheduled sinking fund payment of any Subordinated Obligations (other than
the purchase, repurchase or other acquisition of Subordinated Obligations
purchased in anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the date
of acquisition) or (iv) the making of any Investment in any Person (other
than a Permitted Investment).
"SEC" means the Securities and Exchange Commission.
"SECURED DEBT" means any Debt of the Company or a Subsidiary secured by
a Lien.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SENIOR DEBT" means (i) Debt of the Company whether outstanding on the
Issue Date or thereafter incurred (including, without limitation, Debt (and
other obligations including for fees, expenses, reimbursements, indemnities
or otherwise) Incurred pursuant to the Credit Agreement Guaranty, any
Interest Rate Agreement or Currency Agreement entered into with a Bank in
connection with the Credit Agreement and any other Guarantee by the Company
of any Debt or monetary obligation of any of its Subsidiaries under the
Credit Agreement or any such Interest Rate Agreement or Currency Agreement
and (ii) accrued and unpaid interest thereon (including interest accruing on
or after the filing of any petition in bankruptcy or for reorganization
relating to the Company or a Subsidiary at the rate otherwise applicable
thereto whether or not post-filing interest is allowed in such proceeding).
"SENIOR SUBORDINATED DEBT" means the Notes and any other Debt of the
Company that specifically provides that such Debt is to rank PARI PASSU with
the Notes in right of payment and is not subordinated by its terms in right
of payment to any Debt or other obligation of the Company which is not Senior
Debt.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"Significant Subsidiary" of the Company as such term is defined in Rule 1-02
of Regulation S-X, promulgated by the SEC.
"STATED MATURITY" means with respect to any security the date specified
in such security as the fixed date on which the final payment of principal of
such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
"STONINGTON" means Stonington Partners, Inc.
13
"SUBORDINATED OBLIGATION" means any Debt of the Company (whether
outstanding on the Issue Date or thereafter Incurred) which by its written
terms is subordinate or junior in right of payment to the Notes.
"SUBSIDIARY" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of
the total voting power of shares of Capital Stock or other interests
(including partnership interests) 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 (i) such Person; (ii) such Person and one or more Subsidiaries of such
Person; or (iii) one or more Subsidiaries of such Person.
"TANGIBLE PROPERTY" means all land, buildings, machinery and equipment
and leasehold interests and improvements which would be reflected on a
balance sheet of the Company prepared in accordance with generally accepted
accounting principles, excluding (i) all rights, contracts and other
intangible assets of any nature whatsoever; and (ii) all inventories and
other current assets.
"TEMPORARY CASH INVESTMENTS" means any of the following: (i) any
investment in direct obligations of the United States of America or any
agency thereof or obligations guaranteed by the United States of America or
any agency thereof, (ii) investments in time deposit accounts, certificates
of deposit and money market deposits maturing within 270 days of the date of
acquisition thereof issued by a bank or trust company which is organized
under the laws of the United States of America, any state thereof or any
foreign country recognized by the United States, and which bank or trust
company has capital, surplus and undivided profits aggregating in excess of
$50,000,000 (or the foreign currency equivalent thereof) and has outstanding
debt which is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization (as defined
in Rule 436 under the Securities Act) or any money-market fund sponsored by a
registered broker dealer or mutual fund distributor, (iii) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (i) above entered into with a bank meeting the
qualifications described in clause (ii) above, (iv) investments in commercial
paper, maturing not more than 180 days after the date of acquisition, issued
by a corporation (other than an Affiliate of the Company) organized and in
existence under the laws of the United States of America, any jurisdiction
thereof or any foreign country recognized by the United States of America
with a rating at the time as of which any investment therein is made of "P-1"
(or higher) according to ▇▇▇▇▇'▇ Investors Service, Inc. or "A-1" (or higher)
according to Standard and Poor's Ratings Group, and (v) investments in
securities with maturities of nine months or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least "A" by Standard & Poor's Ratings
Group or "A" by ▇▇▇▇▇'▇ Investors Service, Inc.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. SECTIONS
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"TRUSTEE" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture,
and thereafter such term shall mean such successor serving hereunder.
14
"U.S. GOVERNMENT OBLIGATION" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States
of America (including any agency or instrumentality thereof) for the payment
of which the full faith and credit of the United States of America is pledged
and which are not callable at the issuer's option.
"VOTING STOCK" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding
and normally entitled (without regard to the occurrence of any contingency)
to vote in the election of directors, managers or trustees thereof.
"WHOLLY OWNED SUBSIDIARY" means a Subsidiary all the Capital Stock of
which (other than directors' qualifying shares and shares held by other
Persons to the extent such shares are required by applicable law to be held
by a Person other than the Company or a Subsidiary) is owned by the Company
or one or more Wholly Owned Subsidiaries.
Section 2. OTHER DEFINITIONS.
TERM DEFINED IN
ARTICLE/SECTION
"AFFILIATE TRANSACTION"...... Section 5.09
"BLOCKAGE NOTICE"............ Section 11.03
"CHANGE OF CONTROL".......... Article IV
"COVENANT DEFEASANCE"........ Section 9.01
"DEFAULT AMOUNT"............. Section 7.02
"EXCESS PROCEEDS OFFER"...... Section 5.08
"EXCESS PROCEEDS PAYMENT".... Section 5.08
"EVENT OF DEFAULT"........... Section 7.01
"FINAL PAYMENT DEFAULT"...... Section 7.01
"LEGAL DEFEASANCE"........... Section 9.01
"NON-PAYMENT DEFAULT"........ Section 7.01
"NOTES PAYMENT".............. Section 11.02
"PAYING AGENT"............... Section 2.03
"PARENT CORPORATION"......... Article IV
"PAYMENT BLOCKAGE PERIOD".... Section 11.03
"PROCEEDING"................. Section 11.02
"REGISTRAR".................. Section 2.03
"SPECIFIED CORPORATION"...... Article IV
15
"SUCCESSOR COMPANY".......... Section 6.01
Section 3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
(i) "INDENTURE SECURITIES" means the Notes;
(ii) "INDENTURE SECURITY HOLDER" means a Holder or Noteholder;
(iii) "INDENTURE TO BE QUALIFIED" means this Indenture;
(iv) "INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the
Trustee;
(v) "OBLIGOR" upon the Notes means each of the Company and
any successor obligor upon the Notes.
All other terms used in this Indenture that are (i) defined by the TIA;
(ii) defined by TIA reference to another statute; or (iii) defined by SEC
rule under the TIA have the meanings so assigned to them.
Section 4. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
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(iii) the word "or" shall not be deemed to be exclusive;
(iv) words in the singular include the plural, and words in the
plural include the singular; and
(v) provisions apply to successive events and transactions.
ARTICLE I
THE NOTES
Section 1. FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of EXHIBIT A hereto, the terms of which are
incorporated in and made a part of this Indenture. The Notes may have such
notations, legends or endorsements approved as to form by the Company and
required, as applicable, by law, stock exchange rule, agreements to which the
Company is subject and/or usage. Each Note shall be dated the date of its
authentication. The Notes shall be issuable only in denominations of $1,000
and integral multiples thereof.
Section 2. EXECUTION AND AUTHENTICATION.
Two Officers of the Company shall sign the Notes for the Company by
manual or facsimile signature. The Company's seal shall be reproduced on the
Notes.
If an Officer whose signature is on a Note no longer holds that office
at the time such Note is authenticated, such Note shall be valid
nevertheleSections
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature of the Trustee shall be conclusive evidence
that a Note has been authenticated in accordance with the terms of this
Indenture.
The Trustee, upon a written order of the Company signed by two Officers
of the Company, shall authenticate the Notes for original issue up to an
aggregate principal amount stated in paragraph 4 of the Notes. The aggregate
principal amount of Notes outstanding at any time shall not exceed the amount
set forth therein except as provided in Section 2.07.
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The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate the Notes. Unless limited by the terms of such
appointment, any such authenticating agent may authenticate the Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such authenticating
agent of the Trustee. An authenticating agent has the same rights as an Agent
to deal with the Company or an Affiliate of the Company.
The Trustee shall have the right to decline to authenticate and deliver
any Notes under this Section 2.02 if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in
good faith shall determine that such action would expose the Trustee to
personal liability to existing Holders for which the Trustee is not
indemnified.
Section 3. REGISTRAR AND PAYING AGENT.
The Company shall maintain (i) an office or agency where the Notes may
be presented for registration of transfer or for exchange (including any
co-registrar, the "REGISTRAR"); and (ii) an office or agency where the Notes
may be presented for payment ("PAYING AGENT"). The Registrar shall keep a
register of the Holders and of the transfer and exchange of the Notes (the
"NOTE REGISTER"). The Company may appoint one or more co-registrars and one
or more additional paying agents. The term "Paying Agent" shall include any
such additional paying agent. The Company may change any Paying Agent,
Registrar or co-registrar without prior notice to any Holder. The Company
shall notify the Trustee and the Trustee shall notify the Holders of the name
and address of any Agent not a party to this Indenture. The Company or any of
its domestically incorporated Wholly Owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar. The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, which shall
incorporate the provisions of the TIA. Any such agency agreement shall
implement the provisions of this Indenture that relate to such Agent. If the
Company fails to maintain a Registrar or Paying Agent, or fails to give the
foregoing notice, the Trustee shall act as such, as appropriate, and shall be
entitled to appropriate compensation in accordance with Section 8.07.
The Company initially appoints the Trustee as Registrar, Paying Agent
and agent for service of notices and demands in connection with the Notes.
Section 4. PAYING AGENT TO HOLD MONEY IN TRUST.
On or prior to each due date of the principal of, premium, if any, and
interest on any Note, the Company shall deposit with the Paying Agent a sum
sufficient to pay such principal, premium, if any, and interest when so
becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for
the benefit of the Holders or the Trustee all money held by the Paying Agent
for the payment of principal of, premium, if any, and interest on the Notes,
and shall notify the Trustee of any Default by the Company in making any such
payment. While any such Default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require
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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 its
domestically incorporated Wholly Owned Subsidiaries) shall have no further
liability for the money delivered to the Trustee. If the Company or its
domestically incorporated Wholly Owned Subsidiaries 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.
Section 5. LISTS OF HOLDERS.
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 the Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee at least five 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.
Section 6. TRANSFER AND EXCHANGE.
Notes shall be issued in registered form. When Notes are presented to
the Registrar with a request to register the transfer or to exchange them for
an equal principal amount of Notes of other denominations, the Registrar
shall register the transfer or make the exchange; PROVIDED, HOWEVER, that any
Note presented or surrendered for registration of transfer or exchange shall
be duly endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Registrar and the Trustee duly executed by the Holder
thereof or by his attorney duly authorized in writing. To permit
registrations of transfer and exchanges, the Company shall execute and the
Trustee shall authenticate Notes at the Registrar's request.
Neither the Company nor the Registrar shall be required to (i) issue,
register the transfer of or exchange Notes during a period beginning at the
opening of business on a Business Day 15 days before the day of any selection
of Notes for redemption under Section 3.02; (ii) register the transfer of or
exchange any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part or (iii) register the
transfer of or exchange any Note during a period beginning at the opening of
business 15 days before an interest payment date and ending at the close of
business on the interest payment date.
No service charge shall be made to any Holder of a Note for any
registration of transfer or exchange (except as otherwise expressly permitted
herein), but the Company may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith.
Prior to due presentment to the Trustee for registration of the
transfer of any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered in the Note Register as
the absolute owner of such Note for the purpose of receiving payment of
principal of, premium, if any, and interest on such Note and for all other
purposes whatsoever, whether or not such Note is overdue, and none of the
Trustee, any Agent nor the Company shall be affected by any notice to the
contrary.
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Section 7. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee, or the Company and
the Trustee receive evidence to their satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee shall
authenticate a replacement Note if the Company's and the Trustee's reasonable
requirements for the replacements of Notes are met. If required by the
Trustee or the Company, an indemnity bond shall 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 or any authenticating agent from any loss
which any of them may suffer if a Note is replaced. The Company and the
Trustee may charge the Holder for their expenses in replacing a Note.
Every replacement Note shall be an obligation of the Company.
Section 8. OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee, except for those cancelled by it, those delivered to it for
cancellation and those described in this Section 2.08 as not outstanding. A
Note does not cease to be outstanding because the Company, a Subsidiary of
the Company or an Affiliate of the Company holds such Note.
If a Note is replaced pursuant to Section 2.07, it shall cease to be
outstanding unless the Trustee receives proof satisfactory to it that such
replaced Note is held by a bona fide purchaser. A mutilated Note ceases to be
outstanding upon surrender of such Note and replacement thereof pursuant to
Section 2.07.
If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest payable on that date with respect to the Notes (or
portions thereof) to be redeemed or maturing, as the case may be, and the
Paying Agent is not prohibited from paying such money to the Holders on that
date pursuant to the terms of this Indenture, then on and after that date
such Notes (or portions thereof) shall cease to be outstanding and interest
thereon shall cease to accrue.
Section 9. TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have such variations as
the Company and the Trustee consider appropriate for temporary Notes. Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Notes in exchange for temporary Notes. Until such
exchange, temporary Notes shall be entitled to the same rights, benefits and
privileges as definitive Notes.
Section 10. CANCELLATION.
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The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for registration of transfer, exchange or payment,
the Trustee and no one else shall cancel all Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation, and shall dispose
of such cancelled Notes in accordance with its customary procedures, unless the
Company directs cancelled Notes to be returned to it. The Company may not issue
new Notes to replace Notes it has redeemed, paid or delivered to the Trustee for
cancellation.
Section 11. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes,
the Company shall pay such defaulted interest in any lawful manner and shall
pay interest on defaulted installments of interest at the rate borne by the
Notes to the extent lawful. The Company may pay such defaulted interest to
the Persons who are Holders of the Notes on a subsequent special record date,
which date shall be at the earliest practicable date but in all events at
least five Business Days prior to the payment date, in each case at the rate
provided in the Notes. The Company shall fix or cause to be fixed any such
special record date and payment date, and, at least 15 days prior to the
special record date, the Company shall mail or cause to be mailed to each
Holder of a Note a notice that states such special record date, such related
payment date and the amount of any such defaulted interest to be paid to
Holders of the Notes.
Section 12. CUSIP NUMBER.
The Company in issuing the Notes may use a "CUSIP" number,
and, if the Company shall do so, the Trustee shall use such CUSIP number in
notices of redemption or exchange as a convenience to Holders; PROVIDED,
HOWEVER, that any such notice may state that no representation is made as to
the correctness or accuracy of the CUSIP number printed in such notice or on
the Notes and that reliance may be placed only on the other identification
numbers printed on the Notes. The Company will notify the Trustee of any
change in a CUSIP number.
ARTICLE IIREDEMPTION
Section 1. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to paragraph 5
of the Notes, the Company shall notify the Trustee in writing of the
redemption date, the principal amount of Notes to be redeemed, the CUSIP
number of such Notes and the paragraph of the Notes pursuant to which the
redemption will occur.
The Company shall give each notice to the Trustee provided for
in this Section 3.01 at least 60 but not more than 90 days before the
redemption date unless the Trustee consents to a
21
shorter period. Such notice shall be accompanied by an Officers' Certificate
and an Opinion of Counsel from the Company to the effect that such redemption
will comply with the conditions herein. If fewer than all of the Notes are to
be redeemed, the record date relating to such redemption shall be selected by
the Company and given to the Trustee, which record date shall not be less
than 15 days after the date of notice to the Trustee.
Section 2. SELECTION OF NOTES TO BE REDEEMED.
If fewer than all the Notes are to be redeemed, the Trustee
shall select the Notes to be redeemed by lot or by such other methods as the
Trustee in its sole discretion shall deem to be fair and appropriate and that
comply with the applicable legal and securities exchange requirements, if
any. The Trustee shall make the selection from outstanding Notes not
previously called for redemption. The Trustee may select for redemption
portions of the principal of Notes that have denominations larger than
$1,000. Notes and portions of Notes the Trustee selects shall be in amounts
of $1,000 or a whole multiple of $1,000. Provisions of this Indenture that
apply to Notes called for redemption also apply to portions of Notes called
for redemption. The Trustee shall notify the Company promptly of the Notes or
portions of Notes to be redeemed.
Section 3. NOTICE OF REDEMPTION.
The Company shall, at least 30 days but not more than 60 days
before a redemption date, mail or cause to be mailed, by first class-mail, a
notice of redemption to each Holder of Notes of that are to be redeemed.
The notice shall identify the Notes to be redeemed and shall
state:
(i) the redemption date;
(ii) the redemption price;
(iii) 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;
(iv) the name and address of the Paying Agent;
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(v) that Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption
price;
(vi) that, unless the Company defaults in making such
redemption payment or the Paying Agent is prohibited from
making such payment pursuant to the terms of this Indenture,
interest on Notes called for redemption ceases to accrue on
and after the redemption date;
(vii) the paragraph of the Notes and/or the Section
of this Indenture pursuant to which the Notes called for
redemption are being redeemed; and
(viii) 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, at least five Business Days prior to
the date upon which such notice is to be mailed unless the Trustee consents
to a shorter period, the Trustee shall give the notice of redemption in the
Company's name and at the Company's expense. In such event, the Company shall
provide the Trustee with the information required by this Section 3.03.
Section 4. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section
3.03, Notes called for redemption shall become due and payable on the
redemption date and at the redemption price stated in such notice of
redemption. Upon surrender to the Paying Agent, such Notes shall be paid at
the redemption price stated in such notice of redemption, plus accrued
interest to the redemption date. Failure to give notice to a Holder or any
defect in any notice shall not affect the validity of any notice to any other
Holder.
Section 5. DEPOSIT OF REDEMPTION PRICE.
On or prior to any redemption date, the Company shall deposit
with the Paying Agent (or, if the Company or a Subsidiary is the Paying
Agent, shall segregate and hold in trust) 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 on that date other than Notes
23
or portions of Notes called for redemption which have been delivered by the
Company to the Trustee for cancellation.
Section 6. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder (at the expense
of the Company) a new Note equal in principal amount to the unredeemed
portion of the Note surrendered.
ARTICLE IIICHANGE OF CONTROL AND ENTERPRISE VALUATION EVENT
Section 1. CHANGE OF CONTROL AND ENTERPRISE VALUATION EVENT.
(a) Upon the occurrence, from time to time, of any of the
following events (each a "CHANGE OF CONTROL") or Enterprise Valuation Event,
each Holder shall have the right to require that the Company repurchase such
Holder's Notes at a purchase price in cash equal to, in the case of an
Enterprise Valuation Event, 107% or, in all other cases, 101% of the
principal amount thereof plus accrued and unpaid interest, if any, to the
date of purchase (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date):
(i) prior to a Public Equity Offering, the Permitted
Holders cease to be the "beneficial owner" (as defined in
Rules l3d-3 and l3d-5 under the Exchange Act), directly or
indirectly, of a majority in the aggregate of the total voting
power of the Voting Stock of the Company or ▇▇▇▇, whether as a
result of issuance of securities of the Company or ▇▇▇▇, any
merger, consolidation, liquidation or dissolution of the
Company or ▇▇▇▇, any direct or indirect transfer of securities
or otherwise (for purposes of this clause (i) and clause (ii)
below, the Permitted Holders shall be deemed to beneficially
own any Voting Stock of a corporation (the "specified
corporation") held by any other corporation (the "parent
corporation") so long as the Permitted Holders beneficially
own (as so defined), directly or indirectly, in the aggregate
a majority of the voting power of the Voting Stock of the
parent corporation);
(ii) on or after a Public Equity Offering, (A) any
"person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than one or more Permitted Holders,
is or becomes the beneficial owner (as defined in clause (i)
above, except that for purposes of this clause (ii) such
person shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire,
24
whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 40%
of the total voting power of the Voting Stock of the Company
or ▇▇▇▇; PROVIDED, HOWEVER, that the Permitted Holders
beneficially own (as defined in clause (i) above), directly or
indirectly, in the aggregate a lesser percentage of the total
voting power of the Voting Stock of the Company or ▇▇▇▇ than
such other person and do not have the right or ability by
voting power, contract or otherwise to elect or designate for
election a majority of the Board of Directors (for the
purposes of this clause (ii), such other person shall be
deemed to beneficially own any voting stock of a specified
corporation held by a parent corporation, if such other person
is the beneficial owner (as defined in this clause (ii)),
directly or indirectly, of more than 40% of the voting power
of the Voting Stock of such parent corporation and the
Permitted Holders beneficially own (as defined in clause (i)
above), directly or indirectly, in the aggregate a lesser
percentage of the voting power of the Voting Stock of such
parent corporation and do not have the right or ability by
voting power, contract or otherwise to elect or designate for
election a majority of the board of directors of such parent
corporation);
(iii) during any period of two consecutive years,
individuals who at the beginning of such period constituted
the Board of Directors of the Company or ▇▇▇▇ (together with
any new directors whose election by such Board of Directors or
whose nomination for election by the shareholders of the
Company or ▇▇▇▇, as the case may be, was approved by a vote of
not less than 66-2/3% of the directors of the Company or ▇▇▇▇,
as the case may be, then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors
then in office; or
(iv) the merger or consolidation of the Company or
▇▇▇▇ with or into another Person or the merger of another
Person with or into the Company or ▇▇▇▇ or the sale or
transfer in one or a series of transactions of all or
substantially all the assets of the Company or ▇▇▇▇ to another
Person, and, in the case only of any such merger or
consolidation, the securities of the Company or ▇▇▇▇, as the
case may be, that are outstanding immediately prior to such
transaction and which represent 100% of the aggregate voting
power of the Voting Stock of the Company or ▇▇▇▇ are changed
into or exchanged for cash, securities or property unless
pursuant to such transaction such securities are changed into
or exchanged for, in addition to any other consideration,
securities of the surviving corporation that represent
immediately after such transaction, at least, a majority of
the aggregate voting power of the Voting Stock of the
surviving corporation.
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(b) Notwithstanding the foregoing, if at the time of the
occurrence of a Change of Control or Enterprise Valuation Event the terms of
the Credit Agreement restrict or prohibit the repurchase of Notes pursuant to
Section 4.01(a), then, prior to the mailing of the notice to Holders provided
for in Section 4.01(c) but in any event within 30 days following any such
Change of Control or Enterprise Valuation Event, the Company shall (i) repay in
full all Debt under the Credit Agreement or offer to repay in full all such
Debt and repay the Debt of each Bank that has accepted such offer or (ii)
obtain any required consent or waiver under the Credit Agreement to permit the
repurchase of the Notes as provided for in Section 4.01(a).
(c) Within 30 days following any Change of Control or Enterprise
Valuation Event, the Company shall mail a notice to each Holder with a copy to
the Trustee stating: (1) that a Change of Control or Enterprise Valuation Event
has occurred and that such Holder has the right to require the Company to
purchase such Holder's Notes at a purchase price in cash equal to, in the case
of an Enterprise Valuation Event, 107% or, in all other cases, 101% of the
principal amount thereof plus accrued and unpaid interest, if any, to the date
of purchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date); (2) the
circumstances and, to the extent available, relevant facts regarding such
Change of Control or Enterprise Valuation Event (including information with
respect to pro forma historical income, cash flow and capitalization after
giving effect to such Change of Control or Enterprise Valuation Event); (3) the
repurchase date (which shall be no earlier than 30 days nor later than 60 days
from the date such notice is mailed); (4) the instructions, determined by the
Company consistent with the covenant described hereunder, that a Holder must
follow in order to have its Notes purchased and, in the case of a Change of
Control that is not treated by the Company as an Enterprise Valuation Event,
(5) a written report from a nationally recognized investment bank or financial
advisory firm addressed to the Trustee confirming such treatment and setting
forth such bank's or firm's analysis thereof in reasonable detail.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to the
provisions of this Article IV. To the extent that the provisions of any
securities laws and regulations conflict with the provisions of this Section
4.01, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Article IV by virtue thereof.
(e) In the event that an Enterprise Valuation Event shall have
occurred within the period of 180 days following any optional redemption of
Notes pursuant to Section 5 of the Notes, the Company shall pay to each Holder
whose Notes were redeemed the difference between the optional redemption price
received by such Holder and the purchase price such Holder would have received
had redeemed Notes instead been purchased as provided in this Article IV, in
each case excluding any portion of such redemption and purchase prices
consisting of accrued interest. Such
26
payment shall be made within 30 days of the occurrence of such Enterprise
Valuation Event, in a manner agreed to by the Company and the Trustee.
ARTICLE IVCOVENANTS
Section 1. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company shall duly and punctually pay the principal of
(and premium, if any) and interest on the Notes in accordance with the terms of
this Indenture and the Notes.
Section 2. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain 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
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 such 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 also from time to time may designate one or more
additional offices or agencies where the Notes may be presented or surrendered
for any or all such purposes and from time to time may rescind any such
designation; PROVIDED, HOWEVER, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
for such purposes. The Company shall give prompt written notice to the Trustee
of any such designation or rescission and of any change in the location of any
such other office or agency.
Section 3. SEC REPORTS.
So long as any of the Notes remain outstanding, the Company
shall cause copies of all quarterly and annual financial reports and of the
information, documents, and other reports (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe) which the
Company or ▇▇▇▇ is required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act, to be filed with the Trustee and mailed to the Holders at
their addresses appearing in the Note Register maintained by the Registrar, in
each case, within 5 Business Days of filing with the SEC. If neither the Company
nor ▇▇▇▇ is not subject to the requirements of such Section 13 or 15(d) of the
Exchange Act, the Company shall nevertheless continue to file with the SEC, in
conformity with Section 13 or Section 15(d) of the Exchange Act, and provide the
Trustee and
27
Holders with such annual and quarterly reports (without exhibits in the case of
documents provided to the Trustee and Holders) and such information, documents
and other reports (or copies of such portions of any of the foregoing as the
SEC may by rules and regulations prescribe) which are specified in Section 13
or Section 15(d) of the Exchange Act. The Company shall also comply with the
provisions of TIA Sections 314(a).
Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein
or determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 4. LIMITATION ON DEBT.
(a) The Company shall not, and shall not permit ▇▇▇▇ to,
Incur, directly or indirectly, any Debt unless, on the date of such Incurrence,
the Consolidated Coverage Ratio exceeds 2.0 to 1.0.
(b) Notwithstanding the foregoing paragraph (a), the Company
or ▇▇▇▇, as the case may be, may Incur any or all of the following Debt:
(i) Debt Incurred pursuant to the Revolving Credit
Facility (consisting of a Tranche A Facility and a Tranche B
Facility, each as defined in the Credit Agreement) and the
Credit Agreement Guaranty in respect thereof; PROVIDED,
HOWEVER, that, after giving effect to any such Incurrence, the
aggregate principal amount of such Debt then outstanding does
not exceed $250 million.
(ii) [Customer Notes Guarantees Incurred following
the Issue Date in an aggregate amount at any one time
outstanding not to exceed $30 million less the amount of
Customer Notes Guarantees Incurred following the Issue Date
then outstanding pursuant to Section 5.05(i) and less the
amount of Investments in Customer Notes made following the
Issue Date then outstanding pursuant to clause (c) of the
definition of "Permitted Investment";]
(iii) Debt owed to and held by a Wholly Owned
Subsidiary of ▇▇▇▇; PROVIDED, HOWEVER, that any subsequent
issuance or transfer of any Capital Stock which results in any
such Wholly Owned Subsidiary ceasing to be a Wholly Owned
Subsidiary or any subsequent transfer of such Debt (other than
to another Wholly
28
Owned Subsidiary of ▇▇▇▇) shall be deemed, in each case, to
constitute the Incurrence of such Debt by the Company or ▇▇▇▇,
as the case may be;
(iv) the Notes;
(v) Debt (including without limitation [Customer
Notes Guarantees)] outstanding on the Issue Date (other than
Debt described in clauses (i), (ii), (iii), (iv), (v), or
(vii) of this Section 5.04);
(vi) Refinancing Debt in respect of Debt Incurred
pursuant to paragraph (a) above or pursuant to clause (iv) or
(v) above or this clause (vi);
(vii) Hedging Obligations with respect to (1) Debt
permitted to be Incurred by the Company or its Subsidiaries
pursuant to this Indenture or (2) transactions denominated in
foreign currencies; and
(viii) Debt (which Debt may, but need not, be
Incurred in whole or in part under the Credit Agreement) in an
aggregate principal amount which, together with all other Debt
of the Company and ▇▇▇▇ outstanding on the date of such
Incurrence (other than Debt permitted by clauses (i) through
(x) of this paragraph (b) or paragraph (a) above), and giving
effect to any concurrent Refinancing of Debt permitted by this
Indenture, does not exceed $15 million.
For purposes of determining compliance with this covenant, (i)
in the event that an item of Debt meets the criteria of more than one of the
types of Debt described in paragraph (b) or is entitled to be incurred pursuant
to paragraph (a), the Company, in its sole discretion, will classify such item
of Debt in any manner that complies with this covenant and such debt will be
treated as having been incurred pursuant to only one of such clauses of
paragraph (b) or pursuant to paragraph (a); and (ii) an item of Debt may be
divided and classified in more than one of the types of Debt in paragraph (b)
or pursuant to paragraph (a).
(c) Notwithstanding paragraph (a) and paragraph (b) above, the
Company shall not Incur any Debt if the proceeds thereof are used, directly or
indirectly, to Refinance any Subordinated Obligations unless such Debt shall be
subordinated to the Notes to at least the same extent as such Subordinated
Obligations.
29
(d) Notwithstanding paragraph (a) and paragraph (b) above, (i)
the Company shall not Incur any Debt if such Debt is subordinated or junior in
ranking and right of payment to any Senior Debt, unless such Debt is Senior
Subordinated Debt or is expressly subordinated in right of payment to Senior
Subordinated Debt; and (ii) the Company shall not issue any Secured Debt which
is not Senior Debt unless contemporaneously therewith effective provision is
made to secure the Notes equally and ratably with such Secured Debt for so long
as such Secured Debt is secured by a Lien.
Section 5. LIMITATION ON DEBT AND PREFERRED STOCK OF SUBSIDIARIES OF ▇▇▇▇.
The Company shall not permit any Subsidiary of ▇▇▇▇ to Incur,
directly or indirectly, any Debt or Preferred Stock except:
(a) Guarantees by such Subsidiaries of Debt of the Company or
▇▇▇▇ described in clause (b)(i), (ii) and (iv) of Section 5.04, other Debt of
the Company or ▇▇▇▇ Incurred under the Credit Facility which is permitted to be
Incurred pursuant to the terms of this Indenture, and Debt of Foreign
Subsidiaries described in clauses (e) and (f) below;
(b) Debt or Preferred Stock issued to and held by the Company,
▇▇▇▇ or a Wholly Owned Subsidiary; PROVIDED, HOWEVER, that any subsequent
issuance or transfer of any Capital Stock which results in any such Wholly Owned
Subsidiary ceasing to be a Wholly Owned Subsidiary or any subsequent transfer of
such Debt or Preferred Stock (other than to the Company or a Wholly Owned
Subsidiary) shall be deemed, in each case, to constitute the issuance of such
Debt or Preferred Stock by the issuer thereof;
(c) Debt or Preferred Stock of a Subsidiary of ▇▇▇▇ Incurred
and outstanding on or prior to the date on which such Subsidiary was acquired by
the Company (other than Debt or Preferred Stock Incurred in connection with, or
to provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to which
such Subsidiary became a Subsidiary or was acquired by the Company); PROVIDED,
HOWEVER, that on the date of such acquisition and after giving effect thereto,
the Company would have been able to Incur at least $1.00 of additional Debt
pursuant to Section 5.04(a);
(d) Debt or Preferred Stock outstanding on the Issue Date
(other than Debt described in clause (a), (b) or (c));
30
(e) [Debt of a Foreign Subsidiary Incurred pursuant to the Credit
Facility; PROVIDED, HOWEVER, that, after giving effect to any such Incurrence,
the aggregate principal amount of Debt outstanding of such Foreign Subsidiary
pursuant to this clause (e) does not exceed the greater of (x) $175 million and
(y) the sum of 85% of the gross book value of the accounts receivable of such
Foreign Subsidiary and 65% of the gross book value of the inventories of such
Foreign Subsidiary;]
(f) Refinancing Debt Incurred in respect of Debt or Preferred
Stock referred to in clause (a), (c) or (d) or this clause (f); PROVIDED,
HOWEVER, that to the extent such Refinancing Debt directly or indirectly
Refinances Debt or Preferred Stock of a Subsidiary described in clause (c),
such Refinancing Debt shall be Incurred only by such Subsidiary;
(g) Hedging Obligations by a Subsidiary with respect to (x) Debt
permitted to be Incurred by such Subsidiary pursuant to this Indenture and (y)
transactions by such Subsidiary denominated in foreign currencies; and
(h) [Customer Notes Guarantees Incurred following the Issue Date
in an aggregate amount at any one time outstanding not to exceed $30 million
less the amount of Customer Notes Guarantees Incurred following the Issue Date
then outstanding pursuant to Section 5.04(b)(ii) and less the amount of
Investments in Customer Notes made following the Issue Date then outstanding
pursuant to clause (B) of the definition of "Permitted Investment."]
Section 6. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Company shall not, and shall not permit any Subsidiary,
directly or indirectly, to make a Restricted Payment if at the time the Company
or such Subsidiary makes such Restricted Payment:
(i) a Default shall have occurred and be continuing (or
would result therefrom);
31
(ii) the Company, after giving pro forma effect to such
Restricted Payment, would not be permitted to Incur an additional
$1.00 of Debt pursuant to Section 5.04(a); or
[(a)iii the aggregate amount of such Restricted Payment and
all other Restricted Payments since the Issue Date would exceed
the sum of:
(A) 50% of the Consolidated Net Income
accrued during the period (treated as one accounting
period) from the beginning of the fiscal quarter
during which the Notes were originally issued to the
end of the most recent fiscal quarter ending at least
45 days prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a
deficit, minus 100% of such deficit); (B) the
aggregate Net Cash Proceeds and aggregate Deemed
Asset Value received by the Company from the issue or
sale of its Capital Stock (other than Disqualified
Stock) or capital contributions with respect thereto
subsequent to the Issue Date (other than an issuance
or sale to a Subsidiary of the Company and except as set
forth in clause (C) other than an issuance or sale to
an employee stock ownership plan or to a trust
established by the Company or any of its Subsidiaries
for the benefit of their employees); (C) the
aggregate Net Cash Proceeds received by the Company
from the issuance or sale of its Capital Stock (other
than Disqualified Stock) to an employee stock
ownership plan or trust established by the Company or
any of its Subsidiaries for the benefit of their
employees subsequent to the date on which the Notes
were originally issued, other than any such issuance
or sale to the extent the purchase by such plan or
trust is financed by Debt of such plan or trust and
for which the Company is liable as guarantor or
otherwise; and (D) the amount by which Debt of the
Company is reduced on the Company's balance sheet
upon the conversion or exchange (other than by a
Subsidiary of the Company) subsequent to the Issue
Date, of any Debt of the Company convertible or
exchangeable for Capital Stock (other than
Disqualified Stock) of the Company (less the amount
of any cash, or the fair value of any other property,
distributed by the Company or any Subsidiary upon
such conversion or exchange, except to the extent
that such distribution results in a reduction in
Consolidated Net Income reflected pursuant to clause
(A) above).]
(b) The provisions of the foregoing paragraph (a) shall not
prohibit:
32
(i) any purchase or redemption of Capital Stock or
Subordinated Obligations of the Company made by exchange for,
or out of the proceeds of the substantially concurrent sale
of, Capital Stock of the Company (other than Disqualified
Stock and other than Capital Stock issued or sold to a
Subsidiary of the Company or an employee stock ownership plan
or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees to the extent
the purchase by such plan or trust is financed by Debt of such
plan or trust and for which the Company or any Subsidiary is
liable as guarantor or otherwise), PROVIDED, HOWEVER, that (A)
such purchase or redemption shall be excluded in the
calculation of the amount of Restricted Payments and (B) the
Net Cash Proceeds from such sale shall be excluded from the
calculation of amounts under clauses (iii)(B) and (iii)(C) of
paragraph (a) above;
(ii) any purchase, repurchase, redemption, defeasance
or other acquisition or retirement for value of Subordinated
Obligations together with any premium payable in connection
therewith made by exchange for, or out of the proceeds of the
substantially concurrent sale of, Debt of the Company which is
permitted to be Incurred pursuant to Section 5.04; PROVIDED,
HOWEVER, that such purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value shall
be excluded in the calculation of the amount of Restricted
Payments;
(iii) dividends paid within 60 days after the date of
declaration thereof if at such date of declaration such
dividend would have complied with this covenant; PROVIDED,
HOWEVER, that at the time of declaration of such dividend, no
other Default shall have occurred and be continuing (or would
result therefrom); and provided, further, however, that such
dividend shall be included in the calculation of the amount
of Restricted Payments;
(iv) the repurchase of shares of, or options to
purchase shares of, common stock of the Company or any of its
Subsidiaries from employees, former employees, directors or
former directors of the Company or any of its Subsidiaries (or
permitted transferees of such employees, former employees,
directors or former directors), pursuant to the terms of the
agreements (including employment agreements) or plans (or
amendments thereto) approved by the Board of Directors under
which such individuals purchase or sell or are granted the
option to purchase or sell, shares of such common stock;
PROVIDED, HOWEVER, that the aggregate amount of such
repurchases in any calendar year shall not exceed the sum of
(x) $2 million and (y) the aggregate Net Cash Proceeds from
any reissuance during such calendar year of Capital Stock to
employees, officers or directors of the Company or its
Subsidiaries;
33
provided further, however, that to the extent that the
aggregate amount of such repurchases is less than $2 million
in any calendar year, the unused portion of such $2 million may
be carried forward to the succeeding calendar year (provided
that the aggregate amount of the repurchases in any calendar
year shall, in no event, exceed $4 million plus the amount of
aggregate Net Cash Proceeds from any reissuance of Capital
Stock described above) in any calendar year; and provided,
further, however, that such repurchases shall be excluded in
the calculation of the amount of Restricted Payments;
(v) Investments in any Person primarily engaged in a
Related Business in an aggregate amount not to exceed $10
million; PROVIDED, HOWEVER, that the amount of such
Investments shall be excluded in the calculation of the amount
of Restricted Payments;
(vi) the payment of any cash dividend on the common
stock of the Company following a Public Equity Offering by the
Company and a payment to the Company used solely to pay
dividends on the common stock of the Company, in each case as
long as no Default or Event of Default has occurred and is
continuing or would thereby result; provided that the
aggregate amount of all such dividends and payments under this
clause (vi) shall not exceed 6% of the Net Cash Proceeds
received by the Company in any such Public Equity Offering in
any calendar year; provided further, however, that such
dividends and payments shall be included in the calculation of
Restricted Payments;
(vii) [Investments in Customer Notes to the extent
such Investments are in existence on the Issue Date; provided,
however, that the amount of such Investments shall be excluded
in the calculation of the amount of Restricted Payments;] or
(viii) [Restricted Payments in an aggregate amount
not to exceed $10 million; provided, however, that the amount
of such Restricted Payments shall be excluded in the
calculation of the amount of Restricted Payments.]
Section 7. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM SUBSIDIARIES.
34
(a) The Company shall not, and shall not permit any Subsidiary
to, create or otherwise cause or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Subsidiary to:
(i) pay dividends or make any other distributions on
its Capital Stock to the Company or a Subsidiary or pay any
Debt owed to the Company,
(ii) make any loans or advances to the Company or
(iii) transfer any of its property or assets to the
Company, except:
(1) any encumbrance or restriction pursuant to the Credit
Facility [or any agreement in effect or entered into on the Issue Date] or
pursuant to the issuance of the Notes;
(2) any encumbrance or restriction with respect to a Subsidiary
of ▇▇▇▇ pursuant to an agreement relating to any Debt Incurred by such
Subsidiary on or prior to the date on which such Subsidiary was acquired by the
Company (other than Debt Incurred as consideration in, or to provide all or any
portion of the funds or credit support utilized to consummate, the transaction
or series of related transactions pursuant to which such Subsidiary became a
Subsidiary or was acquired by the Company) and outstanding on such date;
(3) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Debt Incurred pursuant to an agreement referred to
in clause (1) or (2) or contained in any amendment to an agreement referred to
in clause (1) or clause (2); PROVIDED, however, that the encumbrances and
restrictions contained in any of such refinancing agreement or amendment are no
less favorable to the Noteholders than encumbrances and restrictions with
respect to such Subsidiary contained in such agreements;
(4) any such encumbrance or restriction (A) that restricts in a
customary manner the subletting, assignment or transfer of any property or
asset that is a lease, license, conveyance or contract or similar property or
asset the subject of such encumbrance or restriction, (B) existing by virtue of
any transfer of, agreement to transfer, option or right with respect to, or
Lien on, any property or assets of the Company or any Subsidiary not otherwise
prohibited by this Indenture or (C) arising or agreed to in the ordinary course
of business, not relating to any Indebtedness, and that do not, individually or
in the aggregate, detract from the value of property or assets of the Company
or any
35
Subsidiary in any manner material to the Company or any Subsidiary; PROVIDED
that, in each case, such encumbrance or restriction relates to, and restricts
dealings with, only the property or asset the subject of such encumbrance or
restriction; PROVIDED FURTHER, that such encumbrance or restriction does not
prohibit, limit or otherwise restrict the making or payment of any dividend or
other distribution to the Company or any Subsidiary;
(5) in the case of this clause (iii), restrictions contained in
security agreements or mortgages securing Debt of a Subsidiary of ▇▇▇▇ to the
extent such restrictions restrict the transfer of the property subject to such
security agreements or mortgages;
(6) any encumbrance or restriction imposed solely upon a
Foreign Subsidiary pursuant to an agreement relating to Indebtedness Incurred
by such Foreign Subsidiary which is permitted under the covenant described in
Section 5.05; and
(7) any restriction with respect to a Subsidiary of ▇▇▇▇
imposed pursuant to an agreement entered into for the sale or disposition of
all or substantially all the Capital Stock or assets of such Subsidiary pending
the closing of such sale or disposition.
Section 8. LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK.
(a) The Company shall not, and shall not permit any Subsidiary
to, directly or indirectly, consummate any Asset Disposition unless
(i) the Company or such Subsidiary receives
consideration at the time of such Asset Disposition at least
equal to the fair market value, as determined in good faith by
the Board of Directors (including as to the value of all
non-cash consideration), of the shares and assets subject to
such Asset Disposition and at least 75% of the consideration
thereof received by the Company or such Subsidiary is in the
form of cash or Cash Equivalents, and
(ii) the Company (x) within 180 days (in the case of (A)
below) or 360 days (in the case of (B) below) after receipt of
such Net Available Cash, (A) to the extent the Company so elects
(or is so required by the terms of any Senior Debt), applies an
amount equal to 100% of the Net Available Cash to repay, prepay,
redeem or purchase Senior Debt of the Company or ▇▇▇▇ or Debt
(other than any Disqualified Stock) of a Wholly Owned Subsidiary
of ▇▇▇▇ (in each case other than Debt owed to the Company or an
Affiliate of the Company) or (B) invests or commits to invest
the balance of such Net Available Cash not applied pursuant to
clause (A), in Additional Assets; PROVIDED, HOWEVER, that in
the case of any
36
commitment to invest such investment must be made within one
month thereafter, and any amount not so invested shall be
treated as Excess Proceeds (as defined below); and (y) applies
the balance of such Net Available Cash not applied pursuant to
clause (x), as provided in the following paragraphs of this
covenant. Notwithstanding the foregoing provisions of this
paragraph, the Company and its Subsidiaries shall not be
required to apply any Net Available Cash in accordance with
this paragraph except to the extent that the aggregate Net
Available Cash from all Asset Dispositions which are not
applied in accordance with this paragraph exceeds [$10
million]. The amount of Net Available Cash required to be
applied and not applied as so required shall constitute
"Excess Proceeds". Pending application of Net Available Cash
pursuant to this covenant, such Net Available Cash shall be
invested in Temporary Cash Investments or applied to repay
Debt Incurred under the Revolving Credit Facility without
commitment reduction thereunder.
For the purposes of this covenant, the following are deemed to
be included in Cash Equivalents: (x) the assumption of Debt of the Company or
any Subsidiary and the release of the Company or such Subsidiary from all
liability on such Debt in connection with such Asset Disposition, (y) Temporary
Cash Investments, and (z) securities received by the Company or any Subsidiary
from the transferee that are promptly converted by the Company or such
Subsidiary into cash.
(b) If, as of the first day of any calendar month, the
aggregate amount of Excess Proceeds not theretofore subject to an Excess
Proceeds Offer (as defined below) totals at least [$10 million], the Company
must, not later than the fifteenth Business Day of such month, make an offer (an
"EXCESS PROCEEDS OFFER") to purchase from the Holders (and to purchase Debt
from the holders of any other Senior Subordinated Debt) on a pro rata basis an
aggregate principal amount of Notes equal to the Excess Proceeds (rounded down
to the nearest multiple of $1,000) on such date, at a purchase price equal to
100% of the principal amount of such Notes, plus, in each case, accrued interest
(if any) to the date of purchase (or, in respect of such other Senior
Subordinated Debt, such lesser price, if any, as may be provided for by the
terms of such Senior Subordinated Debt) (the "EXCESS PROCEEDS PAYMENT").
(c) The Company shall comply, to the extent applicable, with
the requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Notes pursuant to this
Section 5.08. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 5.08, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this clause by virtue thereof.
Section 9. LIMITATION ON AFFILIATE TRANSACTIONS.
37
(a) The Company shall not, and shall not permit any Subsidiary
to, enter into or permit to exist any transaction or series of similar
transactions (including the purchase, sale, lease or exchange of any property,
employee compensation arrangements or the rendering of any service with any
Affiliate of the Company or of ▇▇▇▇ (an "AFFILIATE TRANSACTION") unless the
terms thereof:
(i) are no less favorable to the Company or such
Subsidiary than those that could be obtained at the time of
such transaction in arm's length dealings with a Person who is
not such an Affiliate,
(ii) if such Affiliate Transaction involves an amount
in excess of $3 million, (1) are set forth in writing and (2)
have been approved by a majority of the members of the Board
of Directors having no personal stake in such Affiliate
Transaction, and
(iii) if such Affiliate Transaction involves an
amount in excess of $15 million, have been determined by a
nationally recognized investment banking firm to be fair, from
a financial standpoint, to the Company and its Subsidiaries.
(b) The provisions of the foregoing paragraph (a) shall not
prohibit:
(i) any Restricted Payment permitted to be paid pursuant
to Section 5.06;
(ii) any issuance of securities, or other payments,
awards or grants in cash, securities or otherwise pursuant to,
or the funding of, employment arrangements, stock options and
stock ownership plans approved by the Board of Directors and
issued pursuant to the [INSERT NAME OF MANAGEMENT INCENTIVE
PLAN];
(iii) the grant of stock options or similar rights to
employees and directors of the Company pursuant to plans
approved by the Board of Directors;
38
(iv) loans or advances to employees in the ordinary
course of business in accordance with the past practices of
the Company or its Subsidiaries and their predecessors, but in
any event not to exceed [$___ million] in the aggregate
outstanding at any one time;
(v) the payment of reasonable and customary fees to
directors of the Company and its Subsidiaries who are not
employees of the Company or its Subsidiaries; and
(vi) any Affiliate Transaction between the Company
and a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries.
Section 10. COMPLIANCE CERTIFICATES.
The Company shall deliver to the Trustee, within 120 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 has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such Officers' Certificate, that to the
best of his or her knowledge the Company has kept, observed, performed and
fulfilled each 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 each is taking or proposes to take with respect thereto). The
Company shall also comply with TIA Section 314(a)(4).
Section 11. FURTHER INSTRUMENTS AND ACTS.
Upon request of the Trustee, the Company will execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.
ARTICLE V SUCCESSORS
Section 1. WHEN THE COMPANY MAY MERGE OR TRANSFER ASSETS.
39
The Company shall not consolidate with or merge with or into,
or convey, transfer or lease, in one transaction or a series of transactions,
all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person
(the "Successor Company") shall be a Person organized and
existing under the laws of the United States of America, any
State thereof or the District of Columbia and the Successor
Company (if not the Company) shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Notes and this Indenture;
(ii) immediately after giving effect to such
transaction (and treating any Debt which becomes an obligation
of the Successor Company or any Subsidiary of the Successor
Company as a result of such transaction as having been
Incurred by such Successor Company or such Subsidiary at the
time of such transaction), no Default shall have occurred and
be continuing;
(iii) immediately after giving effect to such
transaction, the Successor Company would be able to Incur an
additional $1.00 of Debt pursuant to Section 5.04(a);
(iv) immediately after giving effect to such
transaction, the Successor Company shall have Consolidated Net
Worth in an amount which is not less than the Consolidated Net
Worth of the Company prior to such transaction; and
(v) the Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger or transfer and such
supplemental indenture (if any) comply with the terms of this
Indenture.
Section 2. SUCCESSOR COMPANY SUBSTITUTED.
40
The Successor Company shall be the successor to the Company and
shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture, but the predecessor Company in the
case of a conveyance, transfer or lease shall not be released from the
obligation to pay the principal of and interest on the Notes.
ARTICLE ▇▇▇▇▇▇▇▇▇▇ AND REMEDIES
Section 1. EVENTS OF DEFAULT.
Each of the following shall constitute an "EVENT OF DEFAULT":
(i) the Company defaults in any payment of interest
on any Note when the same becomes due and payable, whether or
not such payment shall be prohibited by Article XI, and such
default continues for a period of 30 days;
(ii) the Company defaults in the payment of the
principal of any Note when the same becomes due and payable at
its Stated Maturity, upon optional redemption, upon
declaration, upon required repurchase or otherwise, whether or
not such payment shall be prohibited by Article XI;
(iii) the Company fails to comply with Article VI;
(iv) the Company fails to comply for 30 days after
the notice specified in this Section 7.01 with any of its
obligations contained in Article IV (other than a failure to
purchase Notes), Section 5.03, Section 5.04, Section 5.05,
Section 5.06, Section 5.07, Section 5.08 (other than a failure
to purchase Notes), or Section 5.09;
(v) the Company fails to comply with any of its
agreements in this Indenture (other than those referred to in
clause (i), clause (ii), clause (iii) or clause (iv) of this
Section 7.01) and such failure continues for 60 days after the
notice specified in this Section 7.01;
(vi) a default under the Credit Agreement or under
any other mortgage, indenture or instrument under which there
may be issued or by which there may be
41
secured or evidenced any Debt for money borrowed by the
Company or any of its Subsidiaries (or the payment of which is
Guaranteed by the Company or any of its Subsidiaries) whether
such Debt or Guarantee now exists, or is created after the
date of this Indenture, which default (1) is caused by failure
to pay principal of or premium, if any, or interest on such
Debt within any applicable grace period after final maturity
("FINAL PAYMENT DEFAULT"), or (2) results in the acceleration
of such Debt prior to its final stated maturity and, in each
case, the principal amount of any such Debt, together with the
principal amount of any other such Debt under which there has
been a Final Payment Default or the maturity of which has been
so accelerated, aggregates $10 million or more and such
default or acceleration continues for 30 days after the notice
specified in this Section 7.01;
(vii) the Company or any Significant Subsidiary of
the Company pursuant to or within the meaning of Bankruptcy
Law: (1) commences a voluntary case, (2) consents to the entry
of an order for relief against it in an involuntary case, (3)
consents to the appointment of a Custodian of it or for all or
substantially all of its property; or (4) makes a general
assignment for the benefit of its creditors;
(viii) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that: (1) is for
relief against the Company or any Significant Subsidiary of
the Company in an involuntary case, (2), appoints a Custodian
of the Company or any Significant Subsidiary of the Company or
for all or substantially all of the property of the Company or
any Significant Subsidiary of the Company, or (3)
orders the liquidation of the Company or any Significant
Subsidiary of the Company, and any such order or decree
remains unstayed and in effect for 60 consecutive days; and
(ix) any final non-appealable judgment or decree for
the payment of money in excess of $10 million is rendered
against the Company or a Significant Subsidiary, remains
outstanding for a period of 60 days following such judgment
and is not discharged, waived or stayed within 10 days after
notice; PROVIDED, that, the amount of such money judgment or
decree shall be calculated net of any insurance coverage that
the Company has determined in good faith is available in whole
or in part with respect to such money, judgment or decree.
A Default under clauses (iv), (v), (vi) or (ix) will not
constitute an Event of Default until the Trustee or the Holders of at least 25%
in principal amount of the outstanding Notes notify
42
the Company of the Default and the Company does not cure such Default within
the time specified after receipt of such notice.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, an Officers' Certificate of any Event of Default
pursuant to clause (iii), clause (vii) or clause (viii) and any event which
with the giving of notice or the lapse of time would become an Event of Default
pursuant to clauses (iv), (v), (vi) or (ix), its status and what action the
Company is taking or proposes to take in respect thereof.
Section 2. ACCELERATION.
If an Event of Default (other than an Event of Default specified
in clause (vii) or clause (viii) of Section 7.01) occurs and is continuing, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
then outstanding Notes, may declare the principal of and accrued but unpaid
interest on all the Notes to be due and payable (collectively, the "DEFAULT
AMOUNT) by notice in writing to the Company, the administrative agent under the
Credit Agreement (if any Debt is then outstanding under the Credit Facility)
and the Trustee specifying the respective Event of Default and that it is a
"notice of acceleration"; PROVIDED, HOWEVER, that the failure to so notify the
administrative agent under the Credit Facility shall not affect the validity of
such acceleration. Upon such a declaration, the Default Amount shall be due and
payable immediately, subject to Article IX and XI of this Indenture.
Notwithstanding the foregoing, in case of an Event of Default specified in
clause (vii) or clause (viii) of Section 7.01, all outstanding Notes shall IPSO
FACTO become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any Holders of the Notes. Under certain
circumstances, 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 (i) if the rescission
would not conflict with any judgment or decree (ii) all existing Events of
Default (except nonpayment of principal, interest or premium that has become
due solely because of the acceleration) have been cured or waived and (iii) the
Company has paid the Trustee all amounts due pursuant to Section 8.07.
Section 3. 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 on the Notes or to enforce the performance of any provision
of the Notes and this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any such Notes in the proceeding.
A delay or omission by the Trustee or any Holder of a Note in exercising any
right or remedy accruing upon any Event of Default shall not
43
impair the right or remedy or constitute a waiver of or acquiescence in such
Event of Default. No remedy shall be exclusive of any other remedy. All
remedies shall be cumulative to the extent permitted by law.
Section 4. WAIVER OF PAST DEFAULTS.
Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default and its consequences, except (i) a
Default in the payment of the principal of, premium, if any, or interest on, the
Notes; or (ii) a Default in respect of a provision that under Section 10.02
cannot be amended without the consent of each Holder affected thereby. Upon any
such waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 5. CONTROL BY MAJORITY.
Subject to certain restrictions, Holders of a majority in
principal amount of the Notes then outstanding 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 the Trustee. However, the
Trustee may refuse to follow any direction that conflicts with law or the terms
of this Indenture or if, subject to Section 8.01, the Trustee reasonably
determines that such action, if taken, would be unduly prejudicial to the rights
of other Holders or may involve the Trustee in personal liability.
Section 6. LIMITATION ON SUITS.
Except to enforce the right to receive payment of principal,
premium, if any, or interest when due, no Holder of a Note may pursue any remedy
with respect to this Indenture or the Notes, unless:
(i) such Holder has previously given the Trustee written
notice that an Event of Default is continuing;
(ii) Holders of at least 25% in principal amount of
the Notes then outstanding have made a written request to the
Trustee to pursue the remedy;
(iii) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense;
44
(iv) the Trustee has not complied with such request
within 60 days after the receipt thereof and the offer of
security or indemnity; and
(v) Holders of a majority in principal amount of the
Notes then outstanding have not given the Trustee a direction
inconsistent with such request within such 60-day period.
A Holder of a Note shall 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 7. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium, if any,
and interest on such Note, on or after the respective due dates expressed in
such Note, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
any such Holder of a Note.
Section 8. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 7.01(i) or Section
7.01(ii) occurs and is continuing, the Trustee may recover judgment in its own
name and as trustee of an express trust against the Company for the entire
amount then due and owing, plus the amounts provided for in Section 8.07.
Section 9. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee and the Holders of the Notes allowed in any judicial proceedings
relative to the Company, the Company's creditors or the Company's property,
and, unless prohibited by law or applicable regulations, may vote on behalf of
the Holders in any election of a trustee in bankruptcy or other Person
performing similar functions, and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make payments to the Trustee, and, in
the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due to Trustee under Section
8.07. Nothing herein contained shall be deemed to
45
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 10. PRIORITIES.
If the Trustee collects any money pursuant to this Article VII,
it shall pay out the money in the following order:
(i) FIRST: to the Trustee for amounts due to it under
Section 8.07;
(ii) SECOND: to holders of Senior Debt to the extent
required by Article XI;
(iii) THIRD: to Holders for amounts due and unpaid on
the Notes for principal, premium, 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, if any, and interest, respectively; and
(iv) FOURTH: to the Company.
The Trustee may fix a record date and payment date for any
payment to Holders pursuant to this Section 7.10.
Section 11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 7.11 shall not apply to a suit by the Trustee, a suit by
a Holder pursuant to Section 7.07, or a suit by Holders of more than 10% in
principal amount of the Notes then outstanding.
Section 12. WAIVER OF STAY, EXTENSION AND USURY LAWS.
46
The Company (to the extent that it may lawfully do so) 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 (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and 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 had been enacted.
ARTICLE VIITRUSTEE
Section 1. DUTIES OF TRUSTEE.
(a) If an Event of Default of which a Responsible Officer of the
Trustee is aware has occurred and is continuing, the Trustee shall exercise
such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a prudent 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 of
which a Responsible Officer of the Trustee is aware:
(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
(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.
(c) The Trustee shall not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct or bad faith, except that:
47
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 8.01;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith, 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 taken or omitted to be taken by it in good faith in
accordance with a direction received by it pursuant to Section
7.05.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject
to paragraph (a), paragraph (b) and paragraph (c) of this Section 8.01.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if the Trustee shall have reasonable grounds to believe that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(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.
(g) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section 8.01 and to the provisions of the TIA.
48
Section 2. RIGHTS OF TRUSTEE.
(a) The Trustee may rely upon any document reasonably 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 any such document
(b) Before the Trustee acts or refrains from taking any action,
the Trustee may require an Officers' Certificate or an Opinion of Counsel or
both. The Trustee shall not be liable for any action taken or omitted to be
taken by it in good faith in reliance on such Officers' Certificate or such
Opinion of Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent; PROVIDED, HOWEVER,
that any such agent is appointed by the Trustee with due care.
(d) The Trustee shall not be liable for any action taken or
omitted to be taken by it in good faith which it reasonably believes to be
authorized or within its rights or powers conferred upon it by this Indenture;
PROVIDED, HOWEVER, that the Trustee's conduct does not constitute negligence,
willful misconduct or bad faith.
(e) The Trustee may consult with counsel of its selection, and
the written advice or opinion of counsel with respect to legal matters shall be
full and complete authorization and protection from liability in respect to any
action taken, omitted or suffered by the Trustee hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(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 pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction.
(g) 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,
49
but the Trustee in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney at the sole cost of the Company, and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation, PROVIDED, HOWEVER, that the Trustee's conduct does not
constitute negligence, willful misconduct or bad faith.
Section 3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights as it would have if the Trustee
were not the trustee hereunder. However, in the event the Trustee acquires any
conflicting interest in accordance with the TIA it must eliminate such
conflicting interest within 90 days, apply to the SEC for permission to continue
as Trustee or resign. Any Paying Agent, Registrar or co-registrar may do the
same-with like rights and duties. The Trustee shall at all times remain subject
to Section 8.10 and Section 8.11.
The Trustee shall not be charged with knowledge of any default
or event of default with respect to the Notes, other than a Default or Event of
Default under Section 7.01(i) or (ii), unless either (i) a Responsible Officer
of the Trustee shall have actual knowledge of such Default or Event of default
or (ii) written notice of such Default or Event of Default shall have been given
to the Trustee by the Company or by any Holder of the Notes.
Section 4. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes,
it shall not be accountable for the Company's use of the proceeds of the Notes
and it shall not be responsible for any statement contained herein or any
statement contained in the Notes or any other document in connection with the
sale of the Notes or pursuant to this Indenture other than the Trustee's
certificates of authentication.
Section 5. NOTICE OF DEFAULT.
If a Default occurs and is continuing and if such Default is
known to the Responsible Officer of the Trustee, the Trustee must mail to each
Holder a notice of such Default within 90 days (or such shorter period as may
be required by applicable law) after such Default occurs. Except in the case of
a Default in payment of principal of, premium, if any, or interest 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.
Section 6. REPORTS BY TRUSTEE TO HOLDERS.
50
Within 60 days after each May 15, beginning with the May 15
following the date of this Indenture, the Trustee shall mail to Holders of
the Notes a brief report dated as of such reporting date that complies with
TIA Section 313(a) to the extent such a report is required by TIA Section
313(a). The Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to the
Holders shall be mailed to the Company and filed with the SEC and each stock
exchange, if any, on which the Notes may be listed. The Company shall
promptly notify the Trustee upon the Notes being listed on any stock exchange
and any delisting thereof.
Section 7. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time
compensation as such parties shall agree in writing for the Trustee's
acceptance of this Indenture and its services hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of
the trustee of an express trust). The Company shall reimburse the Trustee for
all reasonable out-of-pocket expenses incurred or made by it in the course of
its services hereunder. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Trustee's
agents, counsel, accountants and experts.
The Company shall indemnify the Trustee and any predecessor
Trustee and their agents against any and all loss, liability or reasonable
expense, including taxes (other than taxes based upon, measured by or determined
by the income of the Trustee) incurred in connection with the administration of
this trust, including attorneys fees and expenses, and the performance of its
duties under this Indenture, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its power or duties hereunder, except any such loss,
liability or expense attributable to the negligence, willful misconduct or bad
faith of the Trustee.
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 except to the extent
that the Company may be materially prejudiced by such failure. The Company shall
defend the claim and the Trustee shall cooperate in the defense of such claim.
The Trustee may have separate counsel of its selection and the Company shall pay
the reasonable fees and expenses of such counsel. The Company need not reimburse
any expense or indemnify against any loss, liability or expense incurred by the
Trustee through the Trustee's own negligence, willful misconduct or bad faith.
The Company need not pay for any settlement made without its consent, which
consent shall not be unreasonably withheld.
The Company's payment obligations under this Section 8.07
shall survive the resignation or removal of the Trustee or the satisfaction and
discharge of this Indenture.
To secure the Company's payment obligations under this Section
8.07, the Trustee shall have a Lien prior to the Notes on all money or property
held or collected by the Trustee, except
51
such money or property that is held by it in trust for the benefit of Holders
to pay principal and interest on particular Notes.
If the Trustee shall incur expenses after the occurrence of a
Default specified in Section 7.01(vii) or Section 7.01(viii), such expenses
(including the reasonable fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under Bankruptcy Law.
Section 8. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 8.08.
The Trustee may resign at any time and be discharged from the
trust hereby created by so notifying the Company in writing. The Holders of not
less than a majority in principal amount of the Notes then outstanding may
remove the Trustee by so notifying the Trustee and the Company in writing. The
Company shall remove the Trustee if:
(i) the Trustee fails to comply with Section
8.10;
(ii) the Trustee is adjudged bankrupt or
insolvent;
(iii) a Custodian or other public officer takes
charge of the Trustee or its property; or
(iv) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a vacancy exists
in the office of Trustee for any reason (the Trustee in such event being
referred to herein as the retiring Trustee), 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 30 days
after the retiring Trustee gives notice of its resignation or is removed, the
retiring Trustee, the Company or the Holders of at least 10% in principal
amount of the then outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
52
If the Trustee after written request by any Holder who has
been a Holder for at least six months fails to comply with Section 8.10, such
Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
Any 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 of the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, subject to the Lien provided for
in Section 8.07. Notwithstanding replacement of the Trustee pursuant to this
Section 8.08, the Company's obligations under Section 8.07 shall continue for
the benefit of the retiring Trustee.
Section 9. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or
transferee entity without any further act shall constitute the successor
Trustee; PROVIDED, HOWEVER, that such entity shall be otherwise qualified and
eligible under this Article VIII.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated, and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have the full force which
it is anywhere in the Notes or in this Indenture provided that the certificate
of the Trustee shall have.
Section 10. ELIGIBILITY: DISQUALIFICATION.
This Indenture at all times shall have a Trustee which
satisfies the requirements of TIA Section 310(a). Trustee shall be a
corporation organized and doing business under the laws of the United States
of America or of any State thereof authorized under such laws to exercise
corporate trustee power, shall be subject to supervision or examination by
federal or state authority and shall have a combined capital and surplus of
at least $50 million as set forth in its most recently published annual
report of condition. The Trustee shall be subject to TIA Section 310 (b);
PROVIDED, HOWEVER, that there shall be excluded from the operation of TIA
Section 310(b)(1) any indenture or indentures under which other securities
or certificates of interest or participation in other securities of the
Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
Section 11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
53
The Trustee shall comply with TIA Section 311(a),
excluding any creditor relationship listed in TIA Section 311(b). A Trustee
which has resigned or been removed shall be subject to TIA Section 311(a) to
the extent indicated therein.
Section 12. MAY HOLD SECURITIES
The Trustee, any authenticating agent, any paying agent,
any registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to
Section 8.11 hereof and the provisions of the TIA, may otherwise deal with
the Company with the same rights it would have if it were not Trustee,
authenticating agent, paying agent, security registrar or such other agent.
ARTICLE VIII DISCHARGE OF INDENTURE; DEFEASANCE
Section 1. DISCHARGE OF LIABILITY ON NOTES; DEFEASANCE.
(a) When (i) the Company delivers to the Trustee all
outstanding Notes (other than Notes replaced pursuant to Section 2.07) for
cancellation or (ii) all outstanding Notes have become due and payable, whether
at maturity or as a result of the mailing of a notice of redemption pursuant to
Article III of this Indenture and the Company irrevocably deposits with the
Trustee funds sufficient to pay at maturity or upon redemption all outstanding
Notes including interest thereon to maturity or such redemption date (other than
Notes replaced pursuant to Section 2.07), and if in either case the Company pays
all other sums payable hereunder by the Company, then this Indenture shall,
subject to Section 9.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.
(b) Subject to Section 9.01(c) and Section 9.02, the
Company at any time may terminate (i) all of the Company obligations under
the Notes and this Indenture ("LEGAL DEFEASANCE"), except for certain
obligations, including those respecting the defeasance trust and obligations
to register the transfer or exchange of the Notes, to replace mutilated,
destroyed, lost or stolen Notes and to maintain a registrar and paying agent
in respect of the Notes; or (ii) its obligations under Article IV, Section
5.03, Section 5.04, Section 5.05, Section 5.06, Section 5.07, Section 5.08,
Section 5.09, Section 5.10, Section 6.01(iii), Section 6.01(iv) and the
operation of Section 7.01(iv), Section 7.01(vi), Section 7.01(vii) (with
respect only to Significant Subsidiaries), Section 7.01(viii) (with respect
only to Significant Subsidiaries) and Section 7.01(ix) ("COVENANT
DEFEASANCE"). The
54
Company may exercise its legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment
of the Notes may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of the
Notes may not be accelerated because of an Event of Default specified in Section
7.01 (iv), Section 7.01(vi), Section 7.01(vii) (with respect only to Significant
Subsidiaries), Section 7.01(viii) (with respect only to Significant
Subsidiaries) or Section 7.01(ix), or because of the failure of the Company to
comply with Article IV or Section 6.01(iii) or Section 6.01(iv).
Upon satisfaction of the conditions set forth herein and at
the request of the Company, the Trustee shall acknowledge in writing the
discharge of those obligations of the Company terminated thereby.
(c) Notwithstanding clause (a) and clause (b) above, the
Company's obligations contained in Section 2.03, Section 2.04, Section 2.05,
Section 2.06, Section 2.07, Section 8.07, Section 8.08 and this Article IX shall
survive until the Notes have been paid in full. Thereafter, the Company's
obligations contained in Section 8.07, Section 9.04 and Section 9.05 shall
survive.
Section 2. CONDITIONS TO DEFEASANCE.
The Company may exercise its legal defeasance option or its
covenant defeasance option only if:
(i) the Company irrevocably deposits in trust (the
"defeasance trust") with the Trustee money or U.S. Government
Obligations for the payment of principal, premium (if any) and
interest on the Notes to maturity or redemption, as the case
may be;
(ii) such defeasance does not result in a breach or
violation of, or constitute a default under, this Indenture,
the Credit Agreement or any other material agreement or
instrument to which the Company is a party or by which it is
bound;
(iii) the Company delivers to the Trustee a
certificate from a nationally recognized firm of independent
accountants expressing their opinion that the payments of
principal and interest when due and without reinvestment on
the deposited U.S. Government Obligations plus any deposited
money without
55
investment will provide cash at such times and in such
amounts as will be sufficient to pay principal and interest
when due on all the Notes to maturity or redemption, as the
case may be;
(iv) 123 days pass after the deposit is made and
during the 123-day period no Default specified in Section
7.01(vii) or Section 7.01(viii) in either case with respect to
the Company occurs which is continuing at the end of the
period;
(v) the deposit does not result in a breach or
violation of, or constitute a default under, this Indenture
(including, without limitation, Article XI hereof), the Credit
Agreement or any other material agreement or instrument to
which the Company is a party or by which the Company is bound;
(vi) the Company delivers to the Trustee an Opinion
of Counsel to the effect that the trust resulting from the
deposit does not constitute, or is qualified as, a regulated
investment company under the U.S. Investment Company Act of
1940, as amended;
(vii) in the case of the legal defeasance option, the
Company shall have delivered to the Trustee an Opinion of
Counsel in the United States stating that (1) the Company has
received from or there has been published by, the Internal
Revenue Service a ruling, or (2) since the date of this
Indenture there has been a change in the applicable U.S.
Federal income tax law, in either case to the effect that, and
based thereon such Opinion of Counsel shall confirm that, the
Holders will not recognize income, gain or loss for U.S.
Federal income tax purposes as a result of such defeasance and
will be subject to U.S. Federal income tax on the same
amounts, in the same manner and at the same times as would
have been the case if such deposit and defeasance had not
occurred;
(viii) in the case of the covenant defeasance option,
the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States to the effect that the Holders
will not recognize income, gain or loss for U.S. Federal
income tax purposes as a result of such covenant defeasance
and will be subject to U.S. Federal income tax on the same
amounts, in the same manner and at the same times as would
have been the case if such covenant defeasance had not
occurred; and
56
(ix) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the defeasance and discharge of the
Notes as contemplated by this Article IX have been complied
with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of the Notes at a future date in
accordance with Article III.
Section 3. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to this Article IX. The Trustee shall
apply the deposited money and the money from U.S. Government Obligations through
the Paying Agent and in accordance with this Indenture to the payment of
principal of, premium, if any, and interest on the Notes.
Section 4. REPAYMENT TO THE COMPANY.
The Trustee and the Paying Agent shall promptly turn over to
the Company upon request any excess money or securities held by them at any
time.
Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Company upon request any money held by
them for the payment of principal or interest that remains unclaimed for two
years, and, thereafter, Holders entitled to the money shall look to the Company
for payment as general creditors.
Section 5. INDEMNITY FOR GOVERNMENT OBLIGATIONS.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against deposited U.S.
Government Obligations or the principal and interest received on such U.S.
Government Obligations.
Section 6. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with this Article IX by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Notes shall
be revived and reinstated as though no deposit had occurred pursuant to this
Article IX until such time as the Trustee or Paying Agent is permitted to apply
all such money or U.S. Government Obligations
57
in accordance with this Article IX; PROVIDED, HOWEVER, that, if the Company
has made any payment of interest on or principal of any of the Notes because
of 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 or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX AMENDMENT, SUPPLEMENT AND WAIVER
Section 1. WITHOUT CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this
Indenture or the Notes without the consent of any Holder:
(i) to cure any ambiguity, omission, defect or
inconsistency;
(ii) to provide for the assumption of the Company's
obligations to the Holders in the case of a merger or
consolidation pursuant to Article VI;
(iii) to provide for uncertificated Notes in addition
to or in place of certificated Notes (provided that the
uncertificated Notes are issued in registered form for
purposes of Section 163(f) of the Code, or in a manner such
that the uncertificated Notes are described in Section
163(f)(2)(B) of the Code);
(iv) to add guarantees with respect to the Notes;
(v) to secure the Notes;
(vi) to add to the covenants of the Company and its
Subsidiaries hereunder for the benefit of the Holders or to
surrender any right or power conferred upon the Company;
(vii) to make any change that would provide any
additional rights or benefits to the Holders or that does not
adversely affect the rights hereunder of any Holder; or
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(viii) to comply with requirements of the SEC in
order to effect or maintain the qualification of this
Indenture under the TIA.
No amendment may be made to any provision of Article XI that
would adversely affect the rights of any holder of Senior Debt then outstanding
unless the holders of such Senior Debt (or their Representative) consent to such
change.
Upon the request of the Company accompanied by a resolution of
the Board of Directors of the Company authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the Trustee of the
documents described in Sections 10.06 and 12.04, the Trustee shall join with the
Company 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 which may be contained therein, but the Trustee
shall not be obligated to enter into such amended or supplemental Indenture
which affects its own rights, dudes or immunities under this Indenture or
otherwise.
After an amendment, supplement or waiver under this Section
10.01 becomes effective, the Company shall mail to the Holders affected thereby
a notice briefly describing any such amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not in
any way impair or affect the validity of any such amended or supplement
Indenture or waiver. Subject to Section 7.04 and Section 7.07, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance by the Company in any particular instance with any provision of this
Indenture or the Notes.
Section 2. WITH CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this
Indenture, the Notes or any amended or supplemental Indenture with the written
consent of the Holders of at least a majority in principal amount of the Notes
then outstanding (including, without limitation, consents obtained in connection
with a Lender offer or exchange for the Notes) and any existing Event of Default
and its consequences or compliance with any provision of this Indenture or the
Notes may be waived with the consent of the Holders of a majority in principal
amount of the Notes then outstanding. However, without the consent of each
Holder of an outstanding Note affected thereby, any amendment, supplement or
waiver may not, among other things:
(i) reduce the amount of Notes the Holders of
which must consent to an amendment;
(ii) reduce the rate of or extend the time for
payment of interest on any Note;
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(iii) reduce the principal of or extend the Stated
Maturity of any Note;
(iv) reduce the premium payable upon the redemption
of any Note or change the time at which any Note may be
redeemed in accordance with Article III;
(v) make any Note payable in money other than that
stated in the Note;
(vi) impair the right of any Holder of the Notes to
receive payment of principal of and interest on such ▇▇▇▇▇▇'s
Notes on or after the due dates therefor or to institute suit
for the enforcement of any payment on or with respect to such
▇▇▇▇▇▇'s Notes;
(vii) make any change in Section 7.04 or Section 7.07
or the second sentence of this Section 10.02; or
(viii) make any change in any provision of Article XI
that adversely affects the interests of any Holder.
Upon the request of the Company accompanied by a resolution of
the Board of Directors of the Company authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory with the Trustee of the consent of the Holders as
aforesaid and upon receipt by the Trustee of the documents described in Sections
10.06 and 12.04, the Trustee shall join with the Company in the execution of
such amended or supplemental Indenture unless such amended or supplemental
Indenture 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 under
this Section 10.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
10.02 becomes effective, the Company shall mail to the Holders affected thereby
a notice briefly describing any such amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any
60
defect therein, shall not in any way impair or affect the validity of any
such amended or supplemental Indenture or waiver. Subject to Section 7.04 and
Section 7.07, the Holders of a majority in aggregate principal amount of the
Notes then outstanding may waive compliance by the Company in any particular
instance with any provision of this Indenture or the Notes.
Section 3. 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 4. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS.
Until an amendment, supplement or waiver becomes effective,
a consent to such amendment, supplement or waiver by a Holder is a continuing
and binding consent by the Holder and every subsequent Holder of the Notes or
portion of a Note that evidences the same Debt as the consenting Holder's
Note, even if a notation of the consent or waiver is not made on any Note.
However, any such Holder or subsequent Holder 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 shall become effective in accordance with its terms and
thereafter shall bind every Holder.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to give their consent
or take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, such Persons which were Holders at such record
date (or their duly designated proxies), and only such Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
Section 5. NOTATION ON OR EXCHANGE OF NOTES.
If an amendment or supplement changes the terms of a Note, the
Trustee may require the Holder to deliver such Note to the Trustee. The Trustee
may place an appropriate notation on the Note regarding the changed terms and
return it to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for such Note shall issue and the Trustee
shall authenticate a new Note that reflects such changed terms. Failure to make
the appropriate notation or to issue a new Note shall not affect the validity of
such amendment or supplement.
Section 6. TRUSTEE TO SIGN AMENDMENTS, ETC.
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The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article X if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment or
supplement the Trustee shall be entitled to receive, and (subject to Section
8.01) shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel stating that such amendment or supplement is authorized or
permitted pursuant to this Indenture. The Company shall not sign any amendment
or supplemental Indenture until the Board of Directors approves any such
amendment or supplemental Indenture.
Section 7. PAYMENT FOR CONSENTS.
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for
or as an inducement to any consent, amendment, supplement or waiver with respect
to any term or provision of this Indenture or the Notes, unless such
consideration is offered to be paid or agreed to be paid to all Holders that
consent, waive or agree to amend or supplement in the time frame set forth in
the solicitation documents relating to any such consent, waiver or agreement to
amend or supplement.
ARTICLE XSUBORDINATION OF NOTES
Section 1. AGREEMENT TO SUBORDINATE.
The Company agrees, and each Holder by accepting the Notes
agrees, that the Indebtedness evidenced by the Notes is subordinated in right of
payment, to the extent and in the manner provided in this Article XI, to the
prior payment in full in cash or Cash Equivalents of all Senior Debt and that
the subordination is for the benefit of and enforceable by the holders of Senior
Debt. The Notes shall in all respects rank PARI PASSU with all other Senior
Subordinated Debt of the Company and only Indebtedness of the Company which is
Senior Debt shall rank senior to the Notes in accordance with the provisions set
forth herein. All provisions of this Article XI shall be subject to Section
11.15 hereof.
Section 2. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION; ETC.
In the event of (i) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to the Company or to its
creditors, as such, or to its assets; or (ii) any liquidation, dissolution or
other winding up of the Company, whether voluntary or involuntary and whether or
not involving insolvency or bankruptcy; or (iii) any assignment for the benefit
of creditors or any other marshalling
62
of assets or liabilities of the Company, then and in any such event specified
in clause (i), clause (ii) or clause (iii) above (each such event, if any,
herein sometimes referred to as a "PROCEEDING"):
(1) the holders of Senior Debt will be entitled to receive payment of
such Senior Debt in full in cash or Cash Equivalents before the
Noteholders are entitled to receive any payment or distribution of
cash, securities or other property with respect to the principal of,
premium, (if any), or interest on or other obligations in respect of
the Notes, or on account of any purchase or other acquisition of Notes
by the Company (all such payments, distributions, purchases and
acquisitions herein referred to, individually and collectively, as a
"NOTES PAYMENT"), and to that end the holders of Senior Debt of the
Company shall be entitled to receive, for application to the payment
thereof, any Notes Payment which may be payable or deliverable in
respect of the Notes in any such Proceeding; and
(2) until the Senior Debt is paid in full in cash or Cash Equivalents,
any Notes Payment to which Noteholders would be entitled but for this
Article XI will be made to holders of such Senior Debt as their
interests may appear. If a Notes Payment is made to Noteholders that,
due to this Article XI should not have been made to them such
Noteholders are required to hold it in trust for the holders of Senior
Debt and pay it over to them as their interests may appear.
In the event that, notwithstanding the foregoing provisions
of this Section 11.02, the Trustee receives payment or distribution of assets
of the Company of any kind or character, before all the Senior Debt of the
Company is paid in full in cash or Cash Equivalents, then and in such event,
such Notes Payment shall be paid over or delivered forthwith to the trustee
in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or
other Person making payment or distribution of assets of the Company for
application to the payment of all Senior Debt of the Company remaining
unpaid, to the extent necessary to pay the Senior Debt of the Company in full
in cash or Cash Equivalents, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt of the Company.
The consolidation of the Company with, or the merger of the
Company into, another Person or the liquidation or dissolution of the Company
following the conveyance or transfer of all or substantially all of its
properties and assets as an entirety to another Person upon the terms and
conditions set forth in Article VI shall not be deemed a Proceeding for the
purposes of this Section 11.02 if the person formed by such consolidation or
into which the Company is merged or the Person which acquires by conveyance or
transfer such properties and assets as an entirety, as the case may be, shall,
as part of such consolidation, merger, conveyance or transfer, comply with the
conditions set forth in Article VI.
Section 3. NO PAYMENT WHEN SENIOR DEBT IN DEFAULT.
The Company may not make any Notes Payment or make any deposit
pursuant to the provisions described under Article IX if (i) any Senior Debt is
not paid when due or (ii) any other default on Senior Debt occurs and the
maturity of such Senior Debt is accelerated in accordance with its terms unless,
in either case, the default has been cured or waived or has ceased to exist and
any
63
such acceleration has been rescinded or such Senior Debt has been discharged
or paid in full; PROVIDED, HOWEVER, that the Company may make Notes Payments
or make any deposit pursuant to the provisions described under Article IX
without regard to the foregoing if the Company and the Trustee receive
written notice approving such payment from the Representative of the Senior
Debt with respect to which either of the events set forth in clause (i) or
(ii) of the immediately preceding sentence has occurred and is continuing.
During the continuance of any default (other than a default described in
clause (i) or (ii) of the second preceding sentence) (a "non-payment
default") with respect to any Senior Debt pursuant to which the maturity
thereof may be accelerated immediately without further notice (except such
notice as may be required to effect such accelerations) or the expiration of
any applicable grace periods, the Company may not make Notes Payments for a
period (a "Payment Blockage Period") commencing upon the receipt by the
Trustee (with a copy to the Company) of written notice (a "Blockage Notice")
of such default from the Representative of the holders of such Designated
Senior Debt specifying an election to effect a Payment Blockage Period and
ending 179 days thereafter (or earlier if such Payment Blockage Period is
terminated (i) by written notice to the Trustee and the Company from the
Person or Persons who gave such Blockage Notice, (ii) because the default
giving rise to such Blockage Notice is no longer continuing or (iii) because
Senior Debt has been discharged or repaid in full). Notwithstanding the
provisions described in the immediately preceding sentence, unless an event
described in clause (i) or (ii) of the first sentence of this paragraph has
occurred, the Company may resume payments on the Notes after the end of such
Payment Blockage Period. The Notes shall not be subject to more than one
Payment Blockage Period in any consecutive 360-day period. For all purposes
of this paragraph, no non-payment default with respect to Senior Debt that
existed or was continuing on the date of the commencement of any Payment
Blockage Period with respect to the Senior Debt initiating such Payment
Blockage Period will be, or can be, made the basis for the commencement of a
second Payment Blockage Period, unless such default has been cured or waived
for a period of not less than 90 consecutive days.
In the event that, notwithstanding the foregoing, the Company
shall make any Notes Payment to the Trustee or any Holder prohibited by the
foregoing provisions of this Section 11.03, then and in such event, such Notes
Payment shall be paid over and delivered forthwith to the holders of the Senior
Debt of the Company remaining unpaid, to the extent necessary to pay in full in
cash or Cash Equivalents all the Senior Debt of the Company.
If payment of the Notes is accelerated because of an Event of
Default, the Company shall promptly notify the holders of Senior Debt or the
Representative of such holders of the acceleration.
The provisions of this Section 11.03 shall not apply to any
Notes Payment with respect to which Section 11.02 would be applicable.
Section 4. ACCELERATION OF PAYMENT OF NOTES.
If payment of the Notes is accelerated because of an Event of
Default, the Company or the Trustee shall promptly notify the holders of all
Senior Debt (or the Representative of such holders) of the acceleration. If any
Senior Debt is outstanding none of the Company or any
64
Guarantor may pay the Notes until five Business Days after the Representative
of all Senior Debt receives notice of such acceleration and, thereafter, may
pay the Notes only if such payments are otherwise permitted pursuant to this
Article XI at such time.
Section 5. PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article XI or elsewhere in this
Indenture or in any of the Notes shall prevent the Company, at any time except
during the pendency of any Proceeding referred to in Section 11.02 or under the
conditions described in Section 11.03, from making Notes Payments.
Section 6. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT.
Subject to the payment in full of all amounts due or to become
due on or in respect of Senior Debt of the Company, or the provision for such
payment, in cash or Cash Equivalents or otherwise in a manner satisfactory to
the holders of Senior Debt of the Company, the Holders shall be subrogated
(equally and ratably with the holders of all Debt of the Company, if any, which
by its express terms is subordinated to Senior Debt of the Company to
substantially the same extent as the Notes are subordinated to the Senior Debt
of the Company and is entitled to like rights of subrogation by reason of any
payments or distributions made to holders of such Senior Debt) in right of
payment to the rights of the holders of such Senior Debt of the Company to
receive payments and distributions of cash, property and securities applicable
to the Senior Debt of the Company until the principal of (and premium, if any)
and interest on the Notes shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of the Senior Debt of
the Company of any cash, property or securities to which the Holders or the
Trustee would be entitled except for the provisions of this Article XI, and no
payments over pursuant to the provisions of this Article XI to the holders of
Senior Debt of the Company by Holders or the Trustee, shall, as among the
Company, its creditors other than holders of Senior Debt and the Holders, be
deemed to be a payment or distribution by the Company to or on account of the
Senior Debt of the Company.
Section 7. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article XI are and are intended solely
for the purpose of defining the relative rights of the Holders on the one hand
and the holders of Senior Debt of the Company on the other hand. Nothing
contained in this Article XI or elsewhere in this Indenture or in the Notes is
intended to or shall (i) impair, as among the Company, its creditors other than
holders of Senior Debt and the Holders, the obligation of the Company, which is
absolute and unconditional, to pay to the Holders the principal of (and premium,
if any) and interest on the Notes as and when the same shall become due and
payable in accordance with their terms; or (ii) affect the relative rights
against the Company of the Holders and creditors of the Company other than the
holders of Senior Debt; or (iii) prevent the Trustee or the Holder from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this
65
Article XI of the holders of Senior Debt of the Company to receive cash,
property and securities otherwise payable or deliverable to the Trustee or
such Holder.
Section 8. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Note by such ▇▇▇▇▇▇'s acceptance thereof
authorizes and directs the Trustee on such ▇▇▇▇▇▇'s behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article XI and appoints the Trustee his attorney-in-fact for any and all
such purposes. If the Trustee does not file a proper claim or proof of debt in
the form required in any bankruptcy, insolvency or receivership proceeding prior
to 30 days before the expiration of the time to file such claim or claims, then
the holders of the Senior Debt or their Representative are hereby authorized to
file an appropriate claim for and on behalf of the Holders. Nothing herein
contained shall be deemed to authorize the Trustee or the holders of Senior Debt
or their Representative to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arraignment, adjudication or
composition affecting the Notes or the rights of any Holder thereof, or to
authorize the Trustee for the holder of Senior Debt or their Representative to
vote in respect of the claim of any Holder in any such proceeding.
Section 9. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior Debt of
the Company to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any noncompliance by the Company with the terms, provisions and
covenants of this Indenture.
Without in any way limiting the generality of the foregoing
paragraph, the holders of the Senior Debt may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Holders and without impairing or releasing
the subordination provided in this Article or the obligations hereunder of
the Holders to the holders of Senior Debt, do any one or more of the
following: (a) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt or any instrument
evidencing the same or any agreement under which Senior Debt is outstanding;
PROVIDED, HOWEVER, that any such alteration shall not increase the amount of
Senior Debt outstanding in a manner prohibited by this Indenture; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Debt; (c) release any Person liable in any manner
for the collection of Senior Debt; and (d) exercise of refrain from
exercising any rights against the Company or any other Person; PROVIDED,
HOWEVER, that in no event shall any such actions limit the right of the
Holder to take any action to accelerate the maturity of the Notes in
accordance with the provisions set forth in Article V or to pursue any rights
or remedies against the parties to the Indenture under the Indenture or under
applicable laws if the taking of such action does not otherwise violate the
terms of this Article.
Section 10. NOTICE TO TRUSTEE.
66
The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment to
or by the Trustee in respect of the Notes. Notwithstanding the provisions of
this Article XI or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which could prohibit the
making of any payment to or by the Trustee in respect of the Notes, unless and
until the Trustee shall have received written notice thereof specifically
referencing this Article XI from the Company or a holder of Senior Debt of the
Company or from any Representative or trustee therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
Section 8.01, shall be entitled in all respects to assume that no such facts
exist; PROVIDED, HOWEVER, that if the Trustee shall not have received the notice
provided for in this Section 11.10 at least three Business Days prior to the
date upon which by the terms hereof any money may became payable for any purpose
(including, without limitation, the payment of the principal of (and premium, if
any) or interest on any Note), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
money and to apply the same to the purpose for which such money was received and
shall not be affected by any notice to the contrary which may be received by it
within three Business Days prior to such date.
Subject to the provisions of Section 8.01, the Trustee and the
Holders shall be entitled to rely on the Representative for the holders of
Senior Debt for the purpose of ascertaining the Persons entitled to participate
in any payment or distribution pursuant to this Article XI. In the event that
the Trustee determines in good faith that further evidence is required with
respect to the right of any person as a holder of Senior Debt of the Company to
participate in any payment or distribution pursuant to this Article XI, the
Trustee may request each Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt of the Company held
by such Person, the extent to which such Person is entitled to participate in
such payment or distribution and any other facts pertinent to the rights of such
Person under this Article XI, and if such evidence is not finished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
Section 11. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGE.
Upon any payment or distribution of assets of the Company
referred to in this Article XI, the Trustee, subject to the provisions of
Section 8.01, and the Holders shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders, for the purpose of ascertaining
the persons entitled to participate in such payment or distribution, the
holders of the Senior Debt of the Company and other Debt 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 XI.
Section 12. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.
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The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Debt of the Company and shall not be liable to any such
holders if it shall mistakenly in the absence of gross negligence or willful
misconduct pay over or distribute to Holders or to the Company or to any other
Person cash, property or securities to which any holders of Senior Debt of the
Company shall be entitled by virtue of this Article XI or otherwise. With
respect to the holders of Senior Debt of the Company, the Trustee undertakes to
perform or to observe only such of its covenants or obligations as are
specifically set forth in this Article XI and no implied covenants or
obligations with respect to holders of Senior Debt of the Company shall be read
into this Indenture against the Trustee.
Section 13. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT; PRESERVATION OF
TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article XI with respect to any Senior Debt of
the Company which may at any time be held by it, to the same extent as any other
holder of Senior Debt of the Company, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder.
Nothing in this Article XI shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 8.07.
Section 14. ARTICLE XI APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article XI shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article XI in addition to or in place of the Trustee;
PROVIDED, HOWEVER, that Section 11.13 shall not apply to the Company or any
Affiliate of the Company if it or such Affiliate acts as Paying Agent.
Section 15. TRUST MONEYS NOT SUBORDINATED.
Notwithstanding anything contained herein to the contrary,
payments from money or the proceeds of U.S. Government Obligations held in trust
under Article IX by the Trustee for the payment of principal of, premium, if
any, and interest on the Notes shall not be subordinated to the prior payment of
any Senior Debt or subject to the restrictions on this Article XI, and none of
the Trustee or the Holders shall be obligated to pay over any such amount to the
Company or any holder of Senior Debt of the Company or any other creditor of the
Company.
Section 16. RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION PROVISIONS.
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Each Holder by accepting a Note acknowledges and agrees
that the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of any Senior Debt, whether
such Senior Debt was created or acquired before or after theissuance of the
Notes, to acquire and continue to hold, or to continue to hold, such Senior
Debt and such holder of Senior Debt shall be deemed conclusively to have
relied on such subordination provisions in acquiring and continuing to hold,
or in continuing to hold, such Senior Debt.
Section 17. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to
holders of Senior Debt, the distribution may be made and the notice given to
their Representative (if any).
Section 18. ARTICLE XI NOT TO PREVENT EVENTS OF DEFAULT OR LIMIT RIGHT TO
ACCELERATE.
The failure to make a payment pursuant to the Notes by reason
of any provision in this Article XI shall not be construed as preventing the
occurrence of a Default. Nothing in this Article XI shall have any effect on the
right of the Holders or the Trustee to accelerate the maturity of the Notes.
ARTICLE XIMISCELLANEOUS
Section 1. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA Sections 318(c), such imposed duties
shall control.
Section 2. NOTICES.
Any notice or communication by the Company or the Trustee to
the other 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
other's address:
If to the Company:
▇▇▇▇ Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: _______________
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If to the Trustee:
HSBC Bank USA
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Vice President - Issuer Services
The Company or the Trustee, by notice each to the other may
designate additional or different addresses for subsequent notices or
communications.
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 answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
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
Note Register. Any notice or communication shall also be so mailed to any Person
described in TIA Section 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in such notice shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner set forth
above within the time prescribed, such notice or communication shall be deemed
to be duly given whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it
shall make a copy to the Trustee and each Agent at the same time.
Section 3. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders pursuant to TIA Section 312(b) may communicate with
other Holders with respect to their rights under this Indenture or the Notes.
The Company, the Trustee, the Registrar, the Paying Agent and any other Person
shall have the protection of TIA Section 312(c).
Section 4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(i) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee stating that, in the
opinion of the signers, all conditions and covenants,
70
if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(ii) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee stating that, in the
opinion of such counsel, all conditions and covenants have
been satisfied.
Section 5. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant contained in this Indenture shall include:
(i) a statement that the Person making such
certificate or opinion has read such condition or covenant;
(ii) 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;
(iii) a statement that, in the opinion of such
Person, he or she has made such examination or investigation
as is necessary to enable him or her to express an informed
opinion as to whether such condition or covenant has been
satisfied; and
(iv) a statement as to whether, in the opinion of
such Person, such condition or covenant has been satisfied.
Section 6. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar and Paying Agent may make reasonable rules and
set reasonable requirements for their functions.
Section 7. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES,
INCORPORATORS AND STOCKHOLDERS.
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No past, present or future director, officer, employee,
incorporator or stockholder of the Company, as such, shall have any liability
for any obligations of the Company under the Notes or this Indenture or for
any claim based on, in respect of, or by reason of, such obligations. Each
Holder by accepting a Note waives and releases all such liability. Such
waiver and release form a part of the consideration for issuance of the Notes.
Section 8. GOVERNING LAW.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not he used to interpret another
indenture, loan or debt agreement of the Company or its Subsidiaries. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10. SUCCESSORS.
All agreements of the Company contained in this Indenture
and the Notes shall bind the Company and its successors. All agreements of
the Trustee in this Indenture shall bind the Trustee and its successors.
Section 11. SEVERABILILY.
In case any provision of this Indenture or 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. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this
Indenture. Each such signed copy shall be deemed to be an original, and all
of such signed copies together shall represent one and the same agreement.
Section 13. TABLE OF CONTENTS, HEADINGS, ETC.
72
The Table of Contents, Cross-Reference Table and Headings of
the Articles and Sections of this Indenture have been inserted for convenience
only, and shall not, for any reason, be deemed to be part of this Indenture and
shall in no way modify or restrict any of the terms or provisions hereof.
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SIGNATURES
DATED AS OF OCTOBER __, 1999 ▇▇▇▇ HOLDINGS, INC.
By:
Name:
Title:
DATED AS OF OCTOBER __, 1999 HSBC BANK USA
as Trustee
By:
Title:
EXHIBIT A
FORM OF FACE OF NOTE
▇▇▇▇ HOLDINGS, INC.
No. Principal Amount $
CUSIP No. _________
12 1/4% Senior Subordinated Notes Due 2005
▇▇▇▇ HOLDINGS, INC., a Delaware corporation, promises to pay
to ____________________, or registered assigns, the principal sum of __________
Dollars on October 15, 2005.
Interest Payment Dates: April 15 and October 15.
Record Dates: April 1 and October 1.
Additional provisions of this Note are set forth on the
reverse side of this Note.
Date:
[SEAL] ▇▇▇▇ HOLDINGS, INC.
By
Title:
By
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
HSBC BANK USA,
as Trustee, certifies
that this is one of the
Notes referred to in the
Indenture.
Dated:___________________________
By:__________________________________
Authorized Signatory
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FORM OF REVERSE SIDE OF NOTE
12 1/4% Senior Subordinated Notes Due 2005
1. INTEREST
▇▇▇▇ HOLDINGS, INC., a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called "THE COMPANY"), promises to pay interest on
the principal amount of this Note at the rate per annum shown above provided,
however, interest payments due on and before October 15, 2001 shall be paid
in the form of additional Notes identical in form to this Note, in lieu of
cash.. The Company will pay interest, whether in cash or in the form of
additional Notes as aforesaid, semi-annually on April 15 and October 15 of
each year, commencing April 15, 2000. 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 October 15, 1999. Interest will be computed on the basis of a
360-day year of twelve 30-day months. The Company shall pay interest on
overdue principal at the rate borne by the Notes and shall pay interest on
overdue installments of interest at such rate to the extent lawful.
2. METHOD OF PAYMENT
The Company will pay interest on the Notes (except
defaulted interest) to the Persons who are registered holders of Notes at the
close of business on the April 1 or October 1 next preceding the interest
payment date even if Notes are cancelled after the record date and on or
before the interest payment date. Holders must surrender Notes to a Paying
Agent to collect principal payments. The Company will pay principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal and interest by check payable in such money. The Company may
deliver any such interest payment to the Paying Agent or to a Holder at the
Holder's registered address. On each Interest Payment Date on and prior
to October 15, 2001, the Trustee shall authenticate additional Notes for
original issuance to each Holder on the relevant Record Date in the aggregate
principal amount required to pay such interest. Additional Notes are an
additional obligation of the Company and shall be governed by, and entitled
to the benefits of, the Indenture (as such term is defined below) and shall
be subject to the terms of the Indenture and shall rank pari passu with and
be subject to the same terms (including the rate of interest from time to
time payable thereon) as this Note (except, as the case may be, with respect
to the issuance date and aggregate principal amount).
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3. PAYING AGENT AND REGISTRAR
Initially, HSBC Bank USA, a New York banking corporation
(the "TRUSTEE"), will act as Paying Agent and Registrar. The Company may
appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. INDENTURE
The Company issued the Notes under an Indenture dated as of
October 15, 1999 (the "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 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the "TIA").
Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Notes are subject to all such terms,
and Holders are referred to the Indenture and the TIA for a statement of
those terms.
The Notes are unsecured senior subordinated obligations of
the Company limited to $112,500,000 aggregate principal amount (except as
otherwise provided in Section 1 of this Note relating to the Company's option
to make certain interest payments on the Notes in the form of additional
Notes). The Indenture imposes certain limitations on the incurrence of
additional indebtedness by the Company and certain of its subsidiaries, the
payment of dividends on, and the redemption of, capital stock of the Company
and certain of its Subsidiaries, the making of Investments, restrictions on
distributions from certain Subsidiaries, the use of proceeds from the sale of
assets and Subsidiary stock and transactions with affiliates. The Indenture
also restricts the ability of the Company to consolidate or merge with or
into, or to transfer all or substantially all its assets to, another person.
5. OPTIONAL REDEMPTION
(a) The Notes will be redeemable, at the Company's option,
in whole or in part, at any time and from time to time, upon not less than 30
nor more than 60 days' prior notice mailed by first-class mail to each
Holder's registered address, at a redemption price (expressed as a percentage
of principal amount), equal to 103.5%, plus accrued interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date).
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In the case of any partial redemption, selection of the
Notes for redemption will be made by the Trustee on a pro rata basis, by lot
or by such other method as the Trustee in its sole discretion shall deem to
be fair and appropriate and in compliance with the applicable legal and
securities exchange requirements, if any, and, although no Note of $1,000 in
original principal amount or less shall be redeemed in part. If any Note is
to be redeemed in part only, the notice of redemption relating to such 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.
6. NOTICE OF REDEMPTION
Notice of redemption shall be mailed at least 30 days but
not more than 60 days before the redemption date to each Holder of Notes 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. If
money sufficient to pay the redemption price of and accrued interest on all
Notes (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date interest ceases to
accrue on such Notes (or such portions thereof) called for redemption.
7. PUT PROVISIONS
Upon a Change of Control or Enterprise Valuation Event, any
Holder will have the right to cause the Company to repurchase all or any part
of the Notes of such Holder at a purchase price equal to, in the case of an
Enterprise Valuation Event, 107% or, in all other cases, 101% of the
principal amount of the Notes to be repurchased plus accrued interest to the
date of repurchase (subject to the right of Holders of record on the relevant
record date to receive interest due on the interest payment date) as provided
in, and subject to the terms of, the Indenture.
8. SUBORDINATION
The Notes are subordinated to Senior Debt, as such term is
defined in the Indenture. To the extent provided in the Indenture, Senior
Debt must be paid in full in cash or Cash Equivalents before the Notes may be
paid. The Company agrees, and each Holder by accepting a Note agrees, to the
subordination provisions contained in the Indenture and authorizes the
Trustee to give effect to such subordination provisions and appoints the
Trustee as attorney-in-fact for such purpose.
9. DENOMINATIONS, TRANSFER, EXCHANGE
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The Notes are in registered form without coupons in
denominations of $1,000 and integral multiples of $1,000 (except that, as
provided in Section 1 of this Note, additional Notes shall be issued in the
amount of accrued and unpaid interest on the Notes due on and before October
15, 2001). Holders may transfer or exchange Notes in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Note selected for redemption
(except, in the case of a Note to be redeemed in part, the portion of the
Note not to be redeemed) or any Notes for a period of 15 days before a
selection of Notes to be redeemed or 15 days before an interest payment date.
10. PERSONS DEEMED OWNERS
The registered Holder of this Note may be treated as the
sole owner of such Note for all purposes.
11. UNCLAIMED MONEY
Subject to applicable abandoned property law, if money for
the payment of principal or interest remains unclaimed for two years, the
Trustee or Paying Agent shall pay the money back to the Company at its
request. After any such payment, Holders entitled to the money must look only
to the Company and not to the Trustee or Paying Agent for payment as general
creditors.
12. DISCHARGE AND DEFEASANCE
Subject to certain conditions, the Company at any time may
terminate some or all of its obligations under the Notes and the Indenture if
the Company deposits with the Trustee money or U.S. Government Obligations
for the payment of principal and interest on the Notes to redemption or
maturity, as the case may be.
13. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture,
(i) the Indenture or the Notes may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Notes;
and (ii) any default or compliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount of the Notes
then outstanding. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Company and the Trustee may amend the
Indenture or the Notes to cure any ambiguity, omission, defect or
inconsistency, or to comply with Article VI of the Indenture, or to provide
for uncertificated Notes, in addition to or in place of certificated Notes,
or to add guarantees with respect
A-5
to the Notes or add additional covenants or surrender rights and powers
conferred on the Company, or to make any change that would provide additional
rights or benefits to the Holders or that does not adversely affect the
rights of any Holder or to comply with requirements of the SEC in connection
with the qualification of the Indenture under the TIA.
14. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default
for 30 days in payment of interest; (ii) default in payment of principal on
the Notes at maturity, upon redemption, upon declaration, upon required
repurchase or otherwise; (iii) failure by the Company to comply with other
covenants in the Indenture or the Notes, in certain cases subject to notice
and lapse of time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other Debt of the Company or
any of its Subsidiaries if the amount accelerated (or so unpaid) aggregates
$10 million or more; (v) certain events of bankruptcy or insolvency with
respect to the Company and its Significant Subsidiaries; and (vi) certain
judgments or decrees for the payment of money in excess of $10 million. If an
Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the Notes may declare all the Notes to be
due and payable immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Notes being due and payable
immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture or the Notes except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture
or the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes
may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders notice of any continuing Default (except a Default in
payment of principal or interest) if it determines that withholding such
notice is in the interest of the Holders.
15. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations imposed by the TIA, the
Trustee under the Indenture, in its individual or any other capacity, may
become the owner or pledgee of Notes and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise
deal with the Company or its Affiliates with the same rights it would have if
it were not Trustee.
16. NO RECOURSE AGAINST OTHERS
A past, present or future director, officer, employee or
stockholder, as such, of the Company or the Trustee shall not have any liability
for any obligations of the Company under the Notes or the Indenture or for any
claim based on, in respect of or by reason of such obligations. By
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accepting a Note, each Holder waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the Notes.
17. AUTHENTICATION
This Note shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the face of this Note.
18. 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 rights of survivorship and not
as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
19. GOVERNING LAW
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICT OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
20. CUSIP NUMBERS
Pursuant to the recommendation promulgated by the Committee
on Uniform Security Identification Procedures the Company has caused CUSIP
numbers to be printed on the Notes and has directed the Trustee to use such
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 to such Holder a copy of the Indenture which contains the
text of this Note in larger type. Requests may be made to:
▇▇▇▇ Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Attention: ___________________
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ASSIGNMENT FORM
To assign this Note, complete the form below:
I or we assign and transfer this Note to:
[PRINT OR TYPE ASSIGNEE'S NAME, ADDRESS AND ZIP CODE]
[INSERT ASSIGNEE'S SOC. SEC. OR TAX I.D. NO. ]
and irrevocably appoint agent to transfer this Note on the
books of the Company. The agent may substitute another to act for him.
==============================================================================
Date: Your Signature:
Sign exactly as your name appears on the face of this Note.
==============================================================================
Guaranteed:
(Signature must be guaranteed by an "eligible guarantor
institution", that is, a bank, stockbroker, saving and loan
association or credit union meeting the requirements of the
Registrar, which requirements include membership or participation
in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as
amended.)
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OPTION OF HOLDER OF NOTE TO ELECT PURCHASE
If you elect to have this Note purchased by the Company pursuant to Article IV,
check the box:
---
If you elect to have only part of this Note purchased by the Company pursuant to
Article IV, state the amount:
$
Date: Your Signature: ______
(Sign exactly as your name
appears on the face of the
Note)
Guaranteed:
(Signature must be guaranteed by an "eligible guarantor
institution", that is, a bank, stockbroker, saving and loan
association or credit union meeting the requirements of the
Registrar, which requirements include membership or participation
in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as
amended.)
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