Exhibit TC3
INDENTURE
Dated as of November o, 2003
by and among
SUPERIOR ESSEX COMMUNICATIONS LLC and ESSEX GROUP, INC.,
as Issuers,
THE GUARANTORS (as defined herein), as Guarantors, and
THE BANK OF NEW YORK, as Trustee
$145,000,000
Second Priority Secured Notes due 2008
TABLE OF CONTENTS
PAGE
ARTICLE 1 Definitions and Incorporation by Reference..............................................................2
SECTION 1.1. Definitions......................................................................2
SECTION 1.2. Other Definitions...............................................................24
SECTION 1.3. Incorporation by Reference of Trust Indenture Act...............................25
SECTION 1.4. Rules of Construction...........................................................25
ARTICLE 2 The Senior Notes.......................................................................................26
SECTION 2.1. Dating; Incorporation of Form in Indenture......................................26
SECTION 2.2. Execution and Authentication....................................................26
SECTION 2.3. Agents..........................................................................28
SECTION 2.4. Paying Agent to Hold Money in Trust.............................................28
SECTION 2.5. Noteholder Lists................................................................28
SECTION 2.6. Transfer and Exchange...........................................................29
SECTION 2.7. Replacement Senior Notes........................................................29
SECTION 2.8. Outstanding Senior Notes........................................................30
SECTION 2.9. Temporary Senior Notes..........................................................30
SECTION 2.10. Cancellation....................................................................30
SECTION 2.11. Defaulted Interest..............................................................30
SECTION 2.12. Deposit of Moneys...............................................................31
SECTION 2.13. CUSIP Number....................................................................31
SECTION 2.14. Payments to Holders.............................................................31
SECTION 2.15. Book-Entry Provisions for Global Notes..........................................32
SECTION 2.16. Record Date.....................................................................33
ARTICLE 3 Redemption.............................................................................................33
SECTION 3.1. Notices to Trustee..............................................................33
SECTION 3.2. Selection by Trustee of Senior Notes to Be Redeemed.............................34
SECTION 3.3. Notice of Redemption............................................................34
SECTION 3.4. Effect of Notice of Redemption..................................................35
SECTION 3.5. Deposit of Redemption Price.....................................................35
SECTION 3.6. Senior Notes Redeemed in Part...................................................35
SECTION 3.7. Optional Redemption.............................................................35
ARTICLE 4 Covenants..............................................................................................36
SECTION 4.1. Payment of Senior Notes.........................................................36
SECTION 4.2. Reports.........................................................................36
SECTION 4.3. Waiver of Stay, Extension or Usury Laws.........................................36
SECTION 4.4. Compliance Certificate..........................................................37
SECTION 4.5. Payment of Taxes, Etc...........................................................37
SECTION 4.6. Change of Control...............................................................37
SECTION 4.7. Limitation on Additional Indebtedness...........................................39
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SECTION 4.8. Limitation on Restricted Payments...............................................41
SECTION 4.9. Limitations on Liens............................................................43
SECTION 4.10. Limitation on Certain Asset Sales...............................................43
SECTION 4.11. Limitation on Transactions with Affiliates......................................45
SECTION 4.12. Limitations on Investments......................................................45
SECTION 4.13. Future Subsidiary Guarantors....................................................45
SECTION 4.14. Designation of Subsidiaries and Unrestricted Subsidiaries.......................46
SECTION 4.15. Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries...............................................................47
SECTION 4.16. Restriction on Sale and Issuance of Certain Subsidiary Equity Interests.........48
SECTION 4.17. Limitation on Sale and Lease-Back Transactions..................................48
SECTION 4.18. Conduct of Business.............................................................48
SECTION 4.19. Limitation on Status as Investment Company......................................48
SECTION 4.20. Corporate Existence.............................................................49
SECTION 4.21. Maintenance of Office or Agency.................................................49
SECTION 4.22. Maintenance of Insurance; Books and Records; Compliance with Laws...............49
SECTION 4.23. Further Assurances to the Trustee...............................................50
SECTION 4.24. Collateral Documents............................................................50
SECTION 4.25. Future Pledges of Collateral to Secure Secondary Senior Notes...................51
SECTION 4.26. Additional Pledges..............................................................51
ARTICLE 5 Successor Corporation..................................................................................51
SECTION 5.1. Merger, Consolidation or Sale of Assets.........................................51
SECTION 5.2. Successor Person Substituted....................................................52
ARTICLE 6 Defaults and Remedies..................................................................................52
SECTION 6.1. Events of Default...............................................................52
SECTION 6.2. Acceleration....................................................................54
SECTION 6.3. Other Remedies..................................................................54
SECTION 6.4. Waiver of Defaults and Events of Default........................................55
SECTION 6.5. Control by Majority.............................................................55
SECTION 6.6. Limitation on Suits.............................................................55
SECTION 6.7. Rights of Holders to Receive Payment............................................56
SECTION 6.8. Collection Suit by Trustee......................................................56
SECTION 6.9. Trustee May File Proofs of Claim................................................56
SECTION 6.10. Priorities......................................................................57
SECTION 6.11. Undertaking for Costs...........................................................57
SECTION 6.12. Restoration of Rights and Remedies..............................................57
SECTION 6.13. Delay or Omission Not Waiver....................................................58
ARTICLE 7 Trustee 58
SECTION 7.1. Duties of Trustee...............................................................58
SECTION 7.2. Rights of Trustee...............................................................59
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SECTION 7.3. Individual Rights of Trustee....................................................60
SECTION 7.4. Trustee's Disclaimer............................................................60
SECTION 7.5. Notice of Defaults..............................................................61
SECTION 7.6. Reports by Trustee to Holders...................................................61
SECTION 7.7. Compensation and Indemnity......................................................61
SECTION 7.8. Replacement of Trustee..........................................................62
SECTION 7.9. Successor Trustee by Consolidation, Merger or Conversion........................63
SECTION 7.10. Eligibility; Disqualification...................................................63
SECTION 7.11. Preferential Collection of Claims Against Issuers...............................63
SECTION 7.12. Paying Agents...................................................................63
SECTION 7.13. Co-Trustee and Separate Trustees................................................64
ARTICLE 8 Amendments, Supplements and Waivers....................................................................65
SECTION 8.1. Without Consent of Holders......................................................65
SECTION 8.2. With Consent of Holders.........................................................66
SECTION 8.3. Compliance with Trust Indenture Act.............................................67
SECTION 8.4. Revocation and Effect of Consents...............................................67
SECTION 8.5. Notation on or Exchange of Senior Notes.........................................68
SECTION 8.6. Trustee to Sign Amendments, etc.................................................68
ARTICLE 9 Discharge Of Indenture; Defeasance.....................................................................68
SECTION 9.1. Discharge of Indenture..........................................................68
SECTION 9.2. Legal Defeasance................................................................69
SECTION 9.3. Covenant Defeasance.............................................................69
SECTION 9.4. Conditions to Legal Defeasance or Covenant Defeasance...........................70
SECTION 9.5. Deposited Money and U.S. Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions.............................................71
SECTION 9.6. Reinstatement...................................................................72
SECTION 9.7. Moneys Held by Paying Agent.....................................................72
SECTION 9.8. Moneys Held by Trustee..........................................................72
SECTION 9.9. Senior Note Collateral..........................................................73
ARTICLE 10 Collateral And Security...............................................................................73
SECTION 10.1. Security........................................................................73
SECTION 10.2. Certificates, Opinions and Recording............................................73
SECTION 10.3. Release of Collateral...........................................................75
SECTION 10.4. Protection of the Trust Estate..................................................76
SECTION 10.5. Certificates of the Issuers.....................................................77
SECTION 10.6. Certificates of the Trustee.....................................................77
SECTION 10.7. Authorization of Actions to be Taken by the Collateral Agent Under the
Collateral Documents.......................................................77
SECTION 10.8. Authorization of Receipt of Funds by the Trustee Under the Collateral
Documents..................................................................78
SECTION 10.9. Termination of Security Interest................................................78
SECTION 10.10. Cooperation of Trustee..........................................................78
SECTION 10.11. Agents Under Collateral Documents...............................................79
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ARTICLE 11 Guarantee of Senior Notes.............................................................................79
SECTION 11.1. Guarantee.......................................................................79
SECTION 11.2. Execution and Delivery of Guarantees............................................80
SECTION 11.3. Limitation of Guarantee.........................................................80
SECTION 11.4. Release of Guarantor............................................................80
SECTION 11.5. Additional Guarantors...........................................................81
ARTICLE 12 Miscellaneous.........................................................................................81
SECTION 12.1. Trust Indenture Act Controls....................................................81
SECTION 12.2. Notices.........................................................................81
SECTION 12.3. Communications by Holders with Other Holders....................................82
SECTION 12.4. Certificate and Opinion as to Conditions Precedent..............................83
SECTION 12.5. Statements Required in Certificate and Opinion..................................83
SECTION 12.6. When Treasury Senior Notes Disregarded..........................................83
SECTION 12.7. Rules by Trustee and Agents.....................................................84
SECTION 12.8. Business Days; Legal Holidays...................................................84
SECTION 12.9. GOVERNING LAW...................................................................84
SECTION 12.10. No Adverse Interpretation of Other Agreements...................................84
SECTION 12.11. No Recourse Against Others......................................................84
SECTION 12.12. Successors......................................................................85
SECTION 12.13. Multiple Counterparts...........................................................85
SECTION 12.14. Table of Contents, Headings, etc................................................85
SECTION 12.15. Separability....................................................................85
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EXHIBITS
Exhibit A Form of Senior Note
Exhibit B Form of Global Note Legend
Exhibit C Form of Supplemental
Indenture
Exhibit D Initial Holders
SCHEDULES
Schedule 1 List of Guarantors
Schedule 1.1 Certain Unrestricted Subsidiaries
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THIS
INDENTURE is dated as of November o, 2003 (the "Effective Date"),
among SUPERIOR ESSEX COMMUNICATIONS LLC, a Delaware limited liability company,
(the "Company"), ESSEX GROUP, INC., a Michigan corporation (the "Co-Issuer"
and, together with the Company, the "Issuers"), SUPERIOR ESSEX INC., a Delaware
corporation ("Holdings"), SUPERIOR ESSEX HOLDING CORP., a Delaware corporation
and wholly-owned subsidiary of Holdings ("Primary Intermediate Holdco"), ESSEX
INTERNATIONAL INC. ("Secondary Intermediate Holdco") each subsidiary of the
Issuers listed in the signature pages hereto (each a "Subsidiary Guarantor", and
together with Holdings, Primary Intermediate Holdco and Secondary Intermediate
Holdco, the "Guarantors"), and The Bank of New York, a New York banking
corporation, as trustee (the "Trustee").
RECITALS
WHEREAS, on March 3, 2003, Superior Telecom Inc., a Delaware corporation
and the former parent corporation of the Issuers ("Telecom"), the Issuers and
certain of their wholly-owned subsidiaries filed a voluntary petition under
Chapter 11 of the United States Code, as amended (the "Bankruptcy Code") with
the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy
Court");
WHEREAS, Telecom, the Issuers and certain of the Guarantors filed a Plan
of Reorganization (the "Plan") which was approved by the Bankruptcy Court on
October 22, 2003;
WHEREAS, pursuant to the Plan, the Issuers are required to issue the
Senior Notes (as defined herein), to certain holders of indebtedness of the
Issuers and certain of the Guarantors outstanding on the date the Plan was
approved by the Bankruptcy Court;
WHEREAS, the Issuers have duly authorized the creation of an issue of
9.5% Second Priority Secured Notes due 2008 (the "Senior Notes") and Secondary
Senior Notes (as defined herein), if any, that may be issued pursuant to
paragraph 1 of the Senior Notes and, to provide therefor, the Issuers have duly
authorized the execution and delivery of this
Indenture;
WHEREAS, all things necessary to make the Senior Notes, when executed by
the Issuers, authenticated and delivered hereunder and duly issued by the
Issuers, the valid obligations of the Issuers, and to make this Indenture a
valid and binding agreement of the Issuers, in accordance with their and its
terms, have been done;
WHEREAS, each of the Guarantors has duly authorized its Guarantee (as
defined below) of the Senior Notes and Secondary Senior Notes, if any, and, to
provide therefor, each Guarantor has duly authorized the execution and delivery
of this Indenture; and
WHEREAS, all things necessary to make the Guarantees, when executed by
the Guarantors and when the Senior Notes have been authenticated and delivered
hereunder and duly issued by the Issuers, the valid and binding obligations of
the Guarantors, and to make this Indenture a valid and binding agreement of the
Guarantors, in accordance with their and its terms, have been done;
A-1
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NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the acquisition of the
Senior Notes for the Holders thereof, it is mutually agreed, for the equal and
ratable benefit of all Holders of the Senior Notes, as follows:
ARTICLE 1
Definitions and Incorporation by Reference
------------------------------------------
SECTION 1.1. Definitions. All terms defined in the Plan of Reorganization
shall have such defined meanings when used herein or in any Exhibit hereto
unless otherwise defined herein or therein. As used in this Agreement, the
following terms shall have the following meanings:
"Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Subsidiary or assumed in connection with an Asset
Acquisition from such Person.
"Acquisition Indebtedness" means Indebtedness incurred by either of the
Issuers or by any one of their respective Subsidiaries after the Issue Date the
proceeds of which are used for an Asset Acquisition.
"Additional Amounts" has the meaning set forth in paragraph 1 of the
Senior Notes.
"Adjusted Net Assets" of a Guarantor at any date shall mean the lesser of
(x) the amount by which the fair value of the property of such Guarantor exceeds
the total amount of liabilities (after giving effect to all fixed and contingent
liabilities (including, without limitation, any guarantees of Indebtedness)),
but excluding liabilities under the Guarantee, of such Guarantor at such date
and (y) the amount by which the present fair salable value of the assets of such
Guarantor at such date exceeds the total amount of its debts (after giving
effect to all fixed and contingent liabilities (including, without limitation,
any guarantees of Indebtedness), and after giving effect to any collection from
any Subsidiary of such Guarantor in respect of the obligations of such
Subsidiary under the Guarantee), but excluding liabilities under the Guarantee.
"Administrative Agent" means Fleet Capital Corporation, as Administrative
Agent for the holders of the Senior Indebtedness under the Credit Agreement,
together with any successor Administrative Agent appointed pursuant thereto.
"Affiliate" of any specified Person means any other Person which directly
or indirectly through one or more intermediaries controls, or is controlled by,
or is under common control with, such specified Person. For the purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by," and "under common control with"), as used with
respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise; PROVIDED that beneficial ownership of 30% or more of the voting
securities of either of the Issuers, Primary Intermediate
3
Holdco, Secondary Intermediate Holdco or Holdings shall be deemed to be
controlled solely for purposes of this Indenture.
"Agent" means any Registrar, Paying Agent, co-registrar or agent for
service of notices and demands.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.
"Asset Acquisition" means (a) an Investment by either of the Issuers or
any Subsidiary of either of the Issuers in any other Person pursuant to which
such Person shall become a Subsidiary of either of the Issuers, or shall be
merged with or into either of the Issuers or any Subsidiary of either of the
Issuers, (b) the acquisition by either of the Issuers or any Subsidiary of
either of the Issuers of the assets of any Person (other than a Subsidiary of
either of the Issuers) which constitute all or substantially all of the assets
of such Person or (c) the acquisition by either of the Issuers or any Subsidiary
of either of the Issuers of any division or line of business of any Person
(other than a Subsidiary of either of the Issuers).
"Asset Sale" means the direct or indirect sale, transfer, issuance,
conveyance, lease, sub-lease (as lessor or sublessor) (other than operating
leases entered into in the ordinary course of business), assignment or other
disposition (including, without limitation, by Condemnation) and any merger or
consolidation of any Subsidiary of either of the Issuers with or into another
Person (other than either of the Issuers or any Wholly-Owned Subsidiary of
either of the Issuers) of any property or asset; PROVIDED, HOWEVER, that Asset
Sales shall not include (i) sales, issuances, leases, conveyances, transfers,
assignments or other dispositions to either of the Issuers or to a Subsidiary of
either of the Issuers or to any other Person if after giving effect to such
sale, issuance, lease, conveyance, transfer, assignment or other disposition
such other Person becomes a Wholly-Owned Subsidiary of either of the Issuers,
(ii) sales, issuances, leases, conveyances, transfers, assignments or other
dispositions of inventory in the ordinary course of business, (iii) transactions
complying with Section 5.1 hereof, (iv) sales, transfers, issuances,
conveyances, leases, assignments or other dispositions to either of the Issuers
or any Wholly-Owned Subsidiary of either of the Issuers, (v) sales, leases,
conveyances, transfers or other dispositions of obsolete, outmoded, worn out or
surplus property, (vi) license, as licensor or licensee, patents, trademarks,
copyrights and know-how by either of the Issuers or any Subsidiary to third
Persons in the ordinary course of business, (vii) leases or subleases granted by
either of the Issuers or any of their Subsidiaries to third Persons in
arm's-length transactions and not interfering in any material respect with the
business of either of the Issuers or any of their Subsidiaries and (viii) with
respect to the Issuers on a combined basis, sales, leases, conveyances,
transfers or other dispositions with a fair market value less than $7.5 million
in the aggregate during any Fiscal Year and $20.0 million in the aggregate
during the term of the Senior Notes.
"Asset Sale Proceeds" means, with respect to any Asset Sale, (i) cash or
Temporary Cash Investments received by either of the Issuers or any Subsidiary
thereof from such Asset Sale, after (a) provision for all income or other taxes
measured by or resulting from such Asset Sale, (b) transfer taxes, (c) payment
of all brokerage commissions, underwriting and other fees and expenses
(including attorneys' fees, investment banking fees and accounting fees) related
to such
4
Asset Sale, (d) provision for minority interest holders in any Subsidiary as a
result of such Asset Sale, (e) payments made to retire Indebtedness secured by
the assets subject to such Asset Sale, and (f) payments made to the Trustee, the
Collateral Agent and the Administrative Agent under the Collateral Agreement,
and (g) deduction of appropriate amounts to be provided by either of the Issuers
or a Subsidiary thereof as a reserve, in accordance with GAAP, against any
liabilities associated with the assets sold or disposed of in such Asset Sale
and retained by either of the Issuers or a Subsidiary thereof after such Asset
Sale, including, without limitation, pension and other post-employment benefit
liabilities and liabilities related to environmental matters or against any
indemnification obligations associated with the assets sold or disposed of in
such Asset Sale, and (ii) promissory notes and other non-cash consideration
received by either of the Issuers or any Subsidiary thereof from such Asset Sale
or other disposition upon the liquidation or conversion of such notes or
non-cash consideration into cash.
"Attributable Indebtedness" when used with respect to any Sale and
Lease-Back Transaction means, as at the time of determination, the present value
(discounted at a rate equivalent to the interest rate implicit in the lease,
compounded on a semi-annual basis) of the total obligations of the lessee for
rental payments (after excluding all amounts required to be paid on account of
maintenance and repairs, insurance, taxes, utilities and other similar expenses
payable by the lessee pursuant to the terms of the lease) during the remaining
term of the lease included in any such Sale and Lease-Back Transaction or until
the earliest date on which the lessee may terminate such lease without penalty
or upon payment of a penalty (in which case the rental payments shall include
such penalty); PROVIDED, that the Attributable Indebtedness with respect to a
Sale and Lease-Back Transaction shall be no less than the fair market value (as
determined reasonably and in good faith by the Board of Directors of the Person
incurring the Attributable Indebtedness) of the property subject to such Sale
and Lease-Back Transaction.
"Bankruptcy Court" means, in the case of Telecom, the Issuers and their
wholly-owned debtor domestic Subsidiaries, the United States Bankruptcy Court
for the District of Delaware, in which the Cases were filed.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
state law for the relief of debtors as in effect from time to time.
"Board of Directors" means, as to any Person, the board of directors or,
if such Person is a partnership (or other non-corporate Person), of the managing
general partner or partners (or Persons serving an analogous function) of such
Person.
"Board Resolution" means, as to any Person, a copy of a resolution
certified pursuant to an Officers' Certificate to have been duly adopted by the
Board of Directors of such Person, and to be in full force and effect, and, if
required hereunder, delivered to the Trustee.
"Brownwood Lease" means that certain Lease Agreement, dated as of
December 16, 1993, as amended, between Superior Essex Communications LLC (f/k/a
Superior Telecommunications Inc.) and ST (TX) LP.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests
5
in a Person (other than a corporation), including, without limitation,
partnership interests and membership interests, and any and all warrants, rights
or options to purchase or other arrangements or rights to acquire any of the
foregoing.
"Capitalized Lease Obligation" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Cases" means, collectively, the cases under chapter 11 of the United
States Bankruptcy Code commenced by the Issuers and all of their domestic
Subsidiaries, and by Telecom and all of its domestic Wholly-Owned Subsidiaries,
in the Bankruptcy Court on March 3, 2003.
"Cash" means money, currency or a credit balance in any demand or Deposit
Account.
"Casualty" with respect to any Collateral, means loss of, damage to or
destruction of all or any part of such Collateral.
"Change of Control" means the occurrence of one or more of the following
events after the Issue Date: (i) any sale, lease, exchange or other transfer (in
one transaction or a series of related transactions) of all or substantially all
of the assets of either of the Issuers to any Person or group of related Persons
for purposes of Section 13(d) of the Exchange Act (a "Group"), together with any
Affiliates of such Person or group of related Persons (which may include any
Initial Holders) thereof (whether or not otherwise in compliance with the
provisions of this Indenture); (ii) the approval by the holders of Capital Stock
of either of the Issuers of any plan or proposal for the liquidation or
dissolution of either of the Issuers (whether or not otherwise in compliance
with the provisions of this Indenture); (iii) any Initial Equity Holder becomes
the owner, directly or indirectly, beneficially or of record, of shares
representing more than (A) 50% of the aggregate ordinary voting power
represented by the issued and outstanding Capital Stock of Primary Intermediate,
Secondary Intermediate Holdco or Holdings or (B) 50% of the aggregate ordinary
voting power represented by the issued and outstanding voting stock of either of
the Issuers; (iv) any other Person or Group shall become the owner, directly or
indirectly, beneficially or of record, of shares representing more than (A) 35%
of the aggregate ordinary voting power represented by the issued and outstanding
Capital Stock of Primary Intermediate Holdco, Secondary Intermediate Holdco or
Holdings or (B) 35% of the aggregate ordinary voting power represented by the
issued and outstanding voting stock of either of the Issuers (other than Primary
Intermediate Holdco, Secondary Intermediate Holdco or Holdings); or (v) the
first day within any two-year period on which a majority of the members of the
Board of Directors of either of the Issuers, Primary Intermediate Holdco,
Secondary Intermediate Holdco or Holdings are not Continuing Directors of such
respective entities.
"Co-Issuer" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party pursuant to Article 5 of this
Indenture and thereafter means the successor.
6
"Collateral" means, collectively, all the real, personal and mixed
property (including Capital Stock) in which Liens are purported to be granted
pursuant to the Collateral Documents as security for the Senior Note
Obligations.
"Collateral Agent" means The Bank of New York, in its capacity as
collateral agent under the Collateral Documents, and its successors in such
capacity.
"Collateral Agreement" means that Collateral Agreement entered into by
the Issuers, the Guarantors and the Collateral Agent on November [___], 2003.
"Collateral Documents" means the Collateral Agreement, the Mortgages, the
Intercreditor Agreement and all other instruments, documents and agreements
delivered by the Issuers or any Guarantor pursuant to the Credit Agreement, this
Indenture or the other Senior Note Documents in order to grant to the Collateral
Agent, for the benefit of Holders, a Lien on any real, personal or mixed
property of the Issuers or a Guarantor, as applicable, as security for the
Senior Note Obligations.
"Common Stock Registration Rights Agreement" means the agreement dated as
of the date hereof entered into by and among Superior Essex Inc. and the Persons
that are signatories thereto.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party pursuant to Article 5 of this
Indenture and thereafter means the successor.
"Condemnation" means any taking of the Collateral or any part thereof, in
or by condemnation, expropriation or similar proceeding, eminent domain
proceedings, seizure or forfeiture, pursuant to any law, general or special, or
by reason of the temporary requisition of the use or occupancy of the
Collateral, or any part thereof, by a governmental authority.
"Condemnation Proceeds" means any awards, proceeds, payment or other
compensation arising out of a Condemnation less any and all (i) payments made to
the Trustee, the Collateral Agent and the Administrative Agent under the
Collateral Documents and the Collateral Agreement and (ii) fees and expenses
incurred in obtaining such Condemnation Proceeds (including attorneys' fees).
"Consolidated Cash Flow Available for Fixed Charges" means, with respect
to any Person for any period, on a consolidated basis in accordance with GAAP,
the sum of, without duplication, the amounts for such period, taken as a single
accounting period, of (A) the sum of (i) Consolidated Net Income, (ii)
Consolidated Non-Cash Charges, (iii) Consolidated Interest Expense, (iv)
Consolidated Income Tax Expense, (v) (for any period ending on or prior to
December 31, 2003 only) to the extent deducted in determining Consolidated Net
Income, any non-recurring charge or restructuring charge in connection with the
implementation of the Plan of Reorganization (including, without limitation, (1)
all fees and expenses incurred in connection with the execution, delivery and
performance of the Credit Agreement; (2) payments made to Rothschild Inc. in its
capacity as financial advisor to Telecom and its Subsidiaries; and (3) all other
reorganization and restructuring costs and expenses incurred prior to the Plan
Effective Date solely in connection with the calculation contemplated by the
proviso in this definition);
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(vi) (for any period ending on or prior to April 1, 2004) fees and expenses
(including any signing bonus and the fees and expenses of any executive search
firm) in respect of the retention of a Chief Executive Officer of Holdings and
the selection of the members of the Board of Holdings and (vii) (for any period
ending on or prior to the date as of which Holdings ceases to have obligations
(1) to register common stock under Sections 2, 3 and 4 of each of the Common
Stock Registration Rights Agreement and (2) to register the Notes under Sections
2, 3 and 4 of the Notes Registration Rights Agreement) fees and expenses
(including SEC filing fees, NASDAQ or other exchange or market listing fees and
related professional fees) incurred in connection with the initial filing on
Form 10 of Holdings and the other filings required to be made by Holdings or its
Subsidiaries pursuant to the Common Stock Registration Rights Agreement and the
Notes Registration Rights Agreement less (B) any non-Cash items increasing
Consolidated Net Income for such period (excluding any such non-Cash item to the
extent it represents the reversal of an accrual or reserve for potential Cash
item in any prior period); PROVIDED, HOWEVER, that for the purposes of this
definition, (i) with respect to the First Interest Payment Date, Consolidated
Cash Flow Available for Fixed Charges shall be calculated as of the six month
period ending on the last day of the most recently completed calendar month
which is 30 days prior to the First Interest Payment Date and (ii) with respect
to the Second Interest Payment Date, Consolidated Cash Flow Available for Fixed
Charges shall be calculated as of the 12 month period ending on the last day of
the most recently completed calendar month which is 30 days prior to the Second
Interest Payment Date.
"Consolidated Fixed Charge Coverage Ratio" means with respect to any
Person, the ratio of the aggregate amount of Consolidated Cash Flow Available
for Fixed Charges of such Person for the four full fiscal quarters immediately
preceding the date of the transaction (the "Transaction Date") giving rise to
the need to calculate the Consolidated Fixed Charge Coverage Ratio (such four
full fiscal quarter period being referred to herein as the "Four Quarter
Period") to the aggregate amount of Consolidated Fixed Charges of such Person
for the Four Quarter Period. In addition to and without limitation of the
foregoing, for purposes of this definition, "Consolidated Cash Flow Available
for Fixed Charges" and "Consolidated Fixed Charges" shall be calculated after
giving effect on a pro forma basis for the period of such calculation to,
without duplication, (a) the incurrence of any Indebtedness of such Person or
any of its Subsidiaries (and the application of the net proceeds thereof) during
the period commencing on the first day of the Four Quarter Period to and
including the Transaction Date (the "Reference Period"), including, without
limitation, the incurrence of the Indebtedness giving rise to the need to make
such calculation (and the application of the net proceeds thereof), as if such
incurrence (and application) occurred on the first day of the Four Quarter
Period (it being understood that with respect to Indebtedness incurred under a
revolving facility used primarily to finance working capital, the average daily
principal amount outstanding during the Reference Period shall be deemed to be
the amount incurred during the Reference Period), (b) any Asset Sales or Asset
Acquisitions (including, without limitation, any Asset Acquisition giving rise
to the need to make such calculation as a result of such Person or one of its
Subsidiaries (including any Person who becomes a Subsidiary as a result of the
Asset Acquisition) incurring, assuming or otherwise being liable for Acquired
Indebtedness) occurring during the Four Quarter Period, as if such Asset Sale or
Asset Acquisition occurred on the first day of the Four Quarter Period and (c)
the Net Income as of the first day of the Four Quarter Period of any Person
whose Indebtedness is included in the computation of "Consolidated Fixed
Charges" notwithstanding that such Person was acquired by either of the Issuers
or any of their Subsidiaries after the first day of such Four
8
Fiscal Quarter Period. Furthermore, in calculating "Consolidated Fixed Charges"
for purposes of determining the denominator (but not the numerator) of this
"Consolidated Fixed Charge Coverage Ratio," (i) interest on outstanding
Indebtedness determined on a fluctuating basis as of the Transaction Date and
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date; and (ii) if interest on
Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period. In calculating the Consolidated Fixed Charge Coverage Ratio
and giving pro forma effect to the incurrence of Indebtedness during a Reference
Period, pro forma effect shall be given to use of proceeds thereof to
permanently repay or retire Indebtedness. If such Person or any of its
Subsidiaries directly or indirectly guarantees Indebtedness of a third Person,
for purposes of determining the "Consolidated Fixed Charge Coverage Ratio,"
effect shall be given to the incurrence of such guaranteed Indebtedness as if
such Person or such Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum of, without duplication, the amounts for such period of (i)
Consolidated Interest Expense, and (ii) the product of (a) the aggregate amount
of dividends and other distributions paid in cash during such period in respect
of Disqualified Equity Interests of such Person and its Subsidiaries on a
consolidated basis and (b) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined federal, state and
local statutory income tax rate of such Person, expressed as a decimal.
"Consolidated Income Tax Expense" means, with respect to any Person for
any period, the provision for federal, state, local and foreign income taxes of
such Person and its Subsidiaries for each period as determined on a consolidated
basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any Person, on a
consolidated basis in accordance with GAAP, for any period, the sum of, without
duplication, (a) the aggregate amount of interest which, in conformity with
GAAP, would be set forth opposite the caption "interest expense" or any like
caption on an income statement for such Person and its Subsidiaries on a
consolidated basis, (b) imputed interest included in Capitalized Lease
Obligations, (c) all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing, (d) the net
costs associated with Interest Rate Agreements, (e) amortization of other
financing fees and expenses, (f) the interest portion of any deferred payment
obligation, (g) amortization of discount or premium, if any, (h) all other
non-cash interest expense (other than interest amortized to cost of sales), (i)
the interest component of Capitalized Lease Obligations paid, accrued and/or
scheduled to be paid or accrued by such Person and its Subsidiaries during such
period as determined on a consolidated basis in accordance with GAAP and (j) all
interest incurred or paid under any guarantee of Indebtedness (including a
guarantee of principal, interest or any combination thereof) of any Person.
"Consolidated Net Income" means, with respect to any Person, for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP, plus
the amount of any dividends or
9
distributions received by such Person from Unrestricted Subsidiaries; PROVIDED,
HOWEVER, that (a) the Net Income of any Person (the "other Person") in which the
Person in question or any of its Subsidiaries has less than a 100% interest
(which interest does not cause the net income of such other Person to be
consolidated into the net income of the Person in question in accordance with
GAAP) shall be included only to the extent of the amount of dividends or
distributions that in accordance with applicable law could be paid to the Person
in question or its Subsidiaries, (b) the Net Income of any Subsidiary of the
Person in question that is incorporated in a jurisdiction other than the United
States, or a state or territory thereof, shall be included only to the extent of
the amount of dividends or distributions paid to the Person in question or its
Subsidiaries, (c) the Net Income of any Subsidiary of the Person in question
that is subject to any restriction or limitation (whether by terms of its
charter, agreement (other than this Indenture) or applicable law) on the payment
of dividends or the making of other distributions shall be excluded to the
extent such restriction or limitation would prevent such Subsidiary from being
able to pay dividends or make other distributions out of its Net Income, (d) any
net gain or loss resulting from an Asset Sale by the Person in question or any
of its Subsidiaries other than in the ordinary course of business shall be
excluded, (e) extraordinary gains and losses (including any related tax effects)
shall be excluded and (f) the cumulative effect of changes in accounting
principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person at any date,
the consolidated stockholders' equity of such Person less the amount of such
stockholders' equity attributable to Disqualified Equity Interests of such
Person and its Subsidiaries, as determined in accordance with GAAP.
"Consolidated Non-Cash Charges" means, with respect to any Person for any
period, the aggregate depreciation, amortization and other non-cash expenses of
such Person and its Subsidiaries reducing Consolidated Net Income of such Person
and its Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP (excluding any such charges constituting an extraordinary
item or loss or any such charge which required an accrual of or a reserve for
cash charges for any future period).
"Consolidated Total Assets" of any Person means the consolidated total
assets of such Person and its consolidated Subsidiaries, as set forth on the
most recent consolidated balance sheet of such Person and its consolidated
Subsidiaries determined in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of the Issuers, Primary Intermediate Holdco, Secondary
Intermediate Holdco or Holdings, as the case may be, who (i) was a member of
such Board of Directors on the Effective Date or (ii) was nominated for election
or elected to such Board of Directors with, or whose election to such Board of
Directors was approved by, the affirmative vote of a majority of the Directors
who were members of such Board of Directors at the time of such nomination or
election.
"Corporate Trust Office" means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the date hereof is located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇, or such other address as the Trustee may designate from time to time
by notice to the Holders and the Issuers, or the principal corporate trust
10
office of any successor Trustee (or such other address as such successor Trustee
may designate from time to time by notice to the Holders and the Issuers).
"Credit Agreement" means that certain Agreement dated as of November [ ],
2003 (as amended, modified, or otherwise party from time to time), among the
Issuers, the financial institutions from time to time party thereto, and Fleet
Capital Corporation, as the Administrative Agent, and General Electric Capital
Corporation, as Syndication Agent.
"Credit Facility" means (i) the Credit Agreement; (ii) any and all
agreements, instruments and documents executed or delivered pursuant to or in
connection with such Credit Agreement; and (iii) any and all credit agreements,
loan agreements, note purchase agreements, indentures or other agreements,
documents or instruments refinancing, refunding or otherwise replacing, in whole
or in part, the Credit Agreement or any other agreement deemed a Credit Facility
under clause (ii) hereof, whether or not with the same agent, trustee,
representative, lenders or holders, regardless of whether the Credit Facility or
any portion thereof was outstanding or in effect at the time of such
restatement, renewal, extension, restructuring, supplement or modification.
Without limiting the generality of the foregoing, the term "Credit Facility"
shall include any amendment, restatement, renewal, extension, restructuring,
supplement or modification to any Credit Facility and all refundings,
refinancing and replacements of any Credit Facility, in whole or in part,
including any agreement (w) extending the maturity of any Indebtedness incurred
thereunder or contemplated thereby, (x) adding or deleting borrowers or
guarantors thereunder, PROVIDED that the addition of such borrower or guarantor
would not be prohibited by this Indenture, (y) increasing the amount for
Indebtedness incurred thereunder or available to be borrowed thereunder,
PROVIDED such increase is permitted to be incurred under this Indenture or (z)
otherwise altering the terms and conditions thereof in a manner not prohibited
by this Indenture.
"Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement designed to protect
such Person against fluctuations in currency values and not for the purpose of
speculation.
"Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of time of
notice or both would be, an Event of Default.
"Deposit Account" means a demand, time, savings, passbook or like account
with a bank, savings and loan association, credit union or like organization,
other than an account evidenced by a negotiable certificate of deposit.
"Depository" means, with respect to the Senior Notes issued in the form
of one or more Global Notes, The Depository Trust Company or another Person
designated as Depository by the Issuers, which Person must be a clearing agency
registered under the Exchange Act.
"Designated Noncash Consideration" means the fair market value of noncash
consideration received by the Issuers or one of their Subsidiaries in connection
with an Asset Sale, including the cancellation of any Indebtedness, that is so
designated as Designated Noncash Consideration pursuant to an Officers'
Certificate, setting forth the basis of such valuation, or, in
11
the case of the cancellation of any Indebtedness, the principal amount of such
cancelled Indebtedness, executed by an Officer of each of the Issuers.
"Disqualified Equity Interests" means any Equity Interest of either of
the Issuers or any of their Subsidiaries which, by its terms (or by the terms of
any security into which it is convertible or for which it is exchangeable at the
option of the holder), or upon the happening of any event, matures or is subject
to mandatory redemption, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, on or
prior to the Maturity Date of the Senior Notes, for cash or securities
constituting Indebtedness. Without limitation of the foregoing, Disqualified
Equity Interests shall also be deemed to include any Preferred Equity Interests
of either of the Issuers or a Subsidiary of either of the Issuers with respect
to which, under the terms of such Preferred Equity Interests, by agreement or
otherwise, either of the Issuers or such Subsidiary is obligated to pay current
dividends or distributions in cash during the period prior to the Maturity Date.
"Domestic Subsidiary" means any Subsidiary that is organized under the
laws of the United States of America, or any state thereof or the District of
Columbia.
"Effective Date" means the date specified as such in the first paragraph
of this Indenture.
"Equity Interests" means, with respect to any Person, any and all shares
or other equivalents (however designated) of capital stock, partnership
interests or any other participation, right or other interests in the nature of
an equity interest in such Person or any option, warrant or other security
convertible into or exchangeable for any of the foregoing.
"Exchange Act" means the Securities and Exchange Act of 1934, as amended.
"Fair market value" or "fair value" means, with respect to any assets or
property, the price which could be negotiated in an arm's-length free market
transaction, for cash, between a willing seller and a fully informed, willing
and able buyer, neither of whom is under undue pressure or compulsion to
complete the transaction, all as reasonably determined by a majority of the
Board of Directors acting in good faith, such determination to be evidenced by a
Board Resolution delivered to the Trustee.
"Final Decree" means, with respect to the Issuers and the Guarantors
which on the Issue Date are the subject of the Cases, an order entered in the
Cases by the Bankruptcy Court closing the Cases.
"First Interest Payment Date" means the first Interest Payment Date after
the Issue Date.
"Fiscal Quarter" means a fiscal quarter of any Fiscal Year.
"Fiscal Year" means the fiscal year of each of the Issuers and their
respective Subsidiaries which initially shall end on December 31 of each
calendar year.
"GAAP" means generally accepted accounting principles consistently
applied as in effect in the United States from time to time.
12
"Global Note" means a Senior Note evidencing all or a part of the Senior
Notes issued to and registered in the name of the Depository and bearing the
Global Note Legend prescribed in Exhibit B.
"Global Note Legend" means the legend set forth in Exhibit B, which is
required to be placed on all Global Notes issued under this Indenture.
"Guarantee" means, as the context may require, individually, a guarantee,
or collectively, any and all guarantees, of the Obligations of the Issuers with
respect to the Senior Notes by each Guarantor pursuant to the terms of Article
11 hereof.
"Guarantor" means Holdings, Primary Intermediate Holdco, Secondary
Intermediate Holdco and each of the Domestic Subsidiaries of Holdings and
Intermediate Holdco that guarantees any of the Issuers' obligations hereunder
and shall also include any other Subsidiary that subsequently guarantees the
Senior Notes pursuant to Section 4.13.
"Holder" or "Noteholder" means the Person in whose name a Senior Note is
registered on the Registrar's books.
"incur" means, with respect to any Indebtedness or other obligation of
any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become, directly or indirectly, liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such Person (and "incurrence," "incurred," "incurable," and
"incurring" shall have meanings correlative to the foregoing). Any Indebtedness
or Equity Interests 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 Person at the time it becomes a Subsidiary.
Indebtedness consisting of reimbursement obligations in respect of a letter of
credit will be deemed to be incurred when the letter of credit is issued or
renewed.
"Indebtedness" means (without duplication), with respect to any Person,
(i) any indebtedness at any time outstanding, secured or unsecured, contingent
or otherwise, which is for borrowed money (whether or not the recourse of the
lender is to the whole of the assets of such Person or only to a portion
thereof), or evidenced by bonds, notes, debentures or similar instruments or
representing the balance deferred and unpaid of the purchase price of any
property (excluding, without limitation, any balances that constitute accounts
payable or trade payables) if and to the extent any of the foregoing
indebtedness would appear as a liability on a balance sheet of such Person
prepared in accordance with GAAP, (ii) any Capitalized Lease Obligations, (iii)
obligations secured by a Lien to which the property or assets owned or held by
such Person is subject, whether or not the obligation or obligations secured
thereby shall have been assumed, (iv) all Indebtedness of others of the type
described in the other clauses of this definition (including all dividends of
other Persons) the payment of which is guaranteed, directly or indirectly, by
such Person or that is otherwise its legal liability or which such Person has
agreed to purchase or repurchase or in respect of which such Person has agreed
contingently to supply or advance funds (whether or not such items would appear
upon the balance sheet of the guarantor), (v) all obligations for the
reimbursement of any obligor on any letter of credit, banker's acceptance or
similar credit transaction, (vi) Disqualified Equity Interests, (vii)
13
obligations of any such Person under any Interest Rate Agreement applicable to
any of the foregoing and (viii) Attributable Indebtedness. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at such
date of all unconditional obligations as described above and, with respect to
contingent obligations, the maximum liability upon the occurrence of the
contingency giving rise to the obligation; provided, however, that (i) the
amount outstanding at any time of any Indebtedness issued with original issue
discount is the principal amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP and (ii) Indebtedness shall not
include any liability for federal, state, local or other taxes. Notwithstanding
any other provision of the foregoing definition, any trade payable or account
payable arising from the purchase of goods or materials or for services obtained
in the ordinary course of business shall not be deemed to be "Indebtedness" of
the Issuers or any of their Subsidiaries for purposes of this definition.
Furthermore, guarantees of, or obligations with respect to letters of credit
supporting, Indebtedness otherwise included in the determination of such amount
shall not also be included.
"Indenture" means this Indenture as amended, restated or supplemented
from time to time.
"Initial Equity Holders" means the beneficial owners of the common stock
of Holdings on the Effective Date.
"Initial Holders" means the Persons set forth in Exhibit D hereto.
"Insurance Proceeds" means any payment, proceeds or other amounts
received at any time under any insurance policy as compensation in respect of a
Casualty, provided that business interruption insurance proceeds shall not
constitute Insurance Proceeds.
"Intercreditor Agreement" means that certain Intercreditor Agreement
dated as of the date hereof by and among the Collateral Agent, Fleet Capital
Corporation as the Administrative Agent under the Credit Facility and their
respective successors, and consented to by the Issuers and the Guarantors, as
amended, amended and restated, supplemented, replaced or otherwise modified from
time to time.
"interest," when used with respect to any Senior Note, means the amount
of all interest accruing on such Senior Note, including all interest accruing
subsequent to the occurrence of any events specified in Sections 6.1(7) and (8)
hereof or which would have accrued but for any such event.
"Interest Payment Date" means each May o and November o of each year,
commencing May o, 2004.
"Interest Rate Agreement" means, for any Person, any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement designed to protect the party indicated therein against
fluctuations in interest rates.
"Investment" means, with respect to any Person, directly or indirectly,
(i) any advance, account receivable (other than an account receivable arising in
the ordinary course of business,
14
including accounts receivable arising in the ordinary course of business and
acquired as part of the assets acquired by either of the Issuers or any of their
Subsidiaries in connection with an acquisition of assets which is otherwise
permitted by the terms of this Indenture), loan or capital contribution to any
other Person (by means of transfers of property to others, payments for property
or services for the account or use of others or otherwise), (ii) the purchase of
any stock, bonds, notes, debentures, partnership or joint venture interests or
other securities of any other Person, (iii) the acquisition, by purchase or
otherwise, of all or substantially all of the business or stock or other
evidence of beneficial ownership of, any other Person, (iv) the guarantee or
assumption of the Indebtedness of any other Person (except for an assumption of
Indebtedness for which the assuming Person receives consideration with a fair
market value at least equal to the principal amount of the Indebtedness
assumed), (v) the designation of a Subsidiary as an Unrestricted Subsidiary and
(vi) all other items that would be classified as investments on a balance sheet
of such Person prepared in accordance with GAAP. Investments shall exclude
extensions of trade credit in accordance with normal trade practices.
"Issue Date" means the date on which the Senior Notes are issued, as
indicated on the Senior Notes.
"Issuers' Request" means any written request signed in the name of each
of the Issuers by any two of the following: the Chief Executive Officer; the
President; any Vice President; the Chief Financial Officer of each of the
Issuers, respectively; the Treasurer; or the Secretary or any Assistant
Secretary (but not both the Secretary and any Assistant Secretary) of each of
the Issuers, respectively.
"Lien" means, with respect to any property or assets of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including,
without limitation, any Capitalized Lease Obligation, conditional sales, or
other title retention agreement having substantially the same economic effect as
any of the foregoing).
"Loss Event" means a Condemnation or Casualty involving an actual or
constructive total loss or agreed or compromised actual or constructive total
loss of all or substantially all of any Property constituting Collateral, except
where the respective Issuer holding title to such Property reasonably concludes
that Restoration of such Property can be made in accordance with this Indenture
and elects to do so in an Officers' Certificate delivered to the Trustee within
180 days of the relevant Condemnation or Casualty.
"Maturity Date" means November o, 2008.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors.
"Mortgages" means any Mortgage, security agreement, assignment of rents
and leases and fixture filing, open end mortgage, deed of trust, indemnity deed
of trust or similar or equivalent instrument secured by real property, trust
deed, deed to secure debt, credit line, deed of trust or assignment of rents,
purporting to grant a security interest in favor of the Collateral Agent in any
of
15
the Collateral, as such document may be amended, supplemented or otherwise
modified from time to time.
"Net Income" means, with respect to any Person for any period, the net
income (loss) of such Person determined in accordance with GAAP.
"Net Investments" means the excess of (i) the aggregate of all
Investments made by either of the Issuers or any of their Subsidiaries on or
after the Issue Date (in the case of an Investment made other than in cash, the
amount shall be the fair market value of such Investment) over (ii) the sum of
(A) the aggregate amount returned in cash on such Investments whether through
interest payments, principal payments, dividends or other distributions, (B) the
net cash proceeds received by either of the Issuers or their respective
Subsidiaries from the disposition of all or any portion of such Investments
(other than to a Subsidiary of either of the Issuers) and (C) the fair market
value of any Unrestricted Subsidiary that is redesignated by either of the
Issuers as a Subsidiary, as determined in good faith by the Board of Directors
of the respective Issuer; provided, however, that with respect to all
Investments made in Unrestricted Subsidiaries, the sum of clauses (A), (B) and
(C) above with respect to such Investments shall not exceed the aggregate amount
of all Investments made in all Unrestricted Subsidiaries.
"Net Proceeds" means (a) in the case of any sale of Equity Interests by
either of the Issuers, the aggregate net proceeds received by such Issuer,
whether such proceeds are in cash or in property (valued at the fair market
value thereof at the time of receipt), and (b) in the case of any exchange,
exercise, conversion or surrender of outstanding securities of any kind (other
than Equity Interests of either of the Issuers which are not Disqualified Equity
Interests) for or into Equity Interests of either of the Issuers which are not
Disqualified Equity Interests, the net book value of such outstanding securities
on the date of such exchange, exercise, conversion or surrender plus any
additional amount required to be paid by the holder to the respective Issuer
upon such exchange, exercise, conversion or surrender (e.g., on account of
fractional shares and less all expenses incurred by either of the Issuers in
connection therewith).
"Notes Registration Rights Agreement" means the agreement dated as of the
date hereof entered into by and among the Issuers, the Guarantors and the
Initial Holders.
"Obligations" means, with respect to any Indebtedness, any principal,
premium, interest, penalties, fees, indemnifications, reimbursements, damages
and other expenses payable under the documentation governing such Indebtedness.
"Officer" means, with respect to any Person, the Chief Executive Officer,
the President, any Vice President, the Chief Financial Officer, the Chief
Accounting Officer or the Treasurer of such Person, the Controller, the
Secretary or any Assistant Secretary of such Person or a Guarantor, or any other
officer designated by the Board of Directors of such Person, as the case may be
(or, in the case of a Person that is a partnership (or other noncorporate
Person), a general partner (or analogous individuals) of such Person in such
capacity).
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chief Executive Officer, the President or any Vice President and
the Chief Financial Officer, the Chief Accounting Officer or any Treasurer of
such Person (or, in the case of a Person that is a
16
partnership (or other non-corporate Person), by a general partner (or analogous
individuals) of such Person in such capacity that shall comply with applicable
provisions of this Indenture.
"Opinion of Counsel" means a written opinion from legal counsel who may
be an employee or counsel to the Issuers.
"Permitted Investments" means, for any Person, Investments made on or
after the date of this Indenture consisting of:
(i) Temporary Cash Investments;
(ii) Investments in either of the Issuers or a Subsidiary of
either of the Issuers;
(iii) Investments in any Person, if (A) as a result of such
Investment (1) such Person becomes a Wholly-Owned Subsidiary of either of
the Issuers or (2) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its assets to,
or is liquidated into, either of the Issuers or a Wholly-Owned Subsidiary
thereof and (B) after giving effect to such Investment the Issuers are in
compliance with Sections 4.17 and 5.1 hereof;
(iv) Investments represented by accounts receivable created or
acquired in the ordinary course of business;
(v) Loans and advances to employees of either of the Issuers and
their Subsidiaries in the ordinary course of business and consistent with
the past practice of the Issuers and their respective Subsidiaries
(including, without limitation, for travel, entertainment and relocation
expenses or in connection with stock purchases and other incentive
compensation programs), which loans and advances, in the aggregate, do
not exceed $500,000 at any time outstanding, provided that the Issuers
and their Subsidiaries may make additional loans to executives solely to
cover relocation costs in an amount not to exceed in the aggregate
$500,000 at any time;
(vi) Investments under or pursuant to Interest Rate Agreements and
Currency Agreements;
(vii) An investment that is made by either of the Issuers or a
Subsidiary thereof in the form of any Equity Interests, Indebtedness or
securities that are issued by any Person solely as partial consideration
for the consummation of an Asset Sale that is otherwise permitted under
Section 4.10 hereof;
(viii) Investments in the Senior Notes;
(ix) Investments existing on the Issue Date;
(x) Investments provided for in the Plan of Reorganization;
17
(xi) Investments in (i) any Securities received in satisfaction or
partial satisfaction thereof from financially troubled account debtors
consistent with the past practices of the Issuers and their Subsidiaries
and (ii) deposits, prepayments and other credits to suppliers and
landlords made in the ordinary course of business consistent with the
past practices of the Issuers and their Subsidiaries;
(xii) guarantees of Indebtedness of the Issuers or any of their
Subsidiaries issued in accordance with Section 4.7;
(xiii) Investments in any Person by either of the Issuers or their
Subsidiaries in connection with the development, construction and
operation of a joint venture which will produce magnet wire in China for
sale in China and abroad; provided, however, that the total aggregate
Investment will not exceed $15 million at any time outstanding;
(xiv) Investments under or pursuant to Section 9.4; and
(xv) Net Investments in any Person; provided, however, that the
aggregate amount of all such Net Investments made pursuant to this clause
(xv) shall not exceed $6 million at any one time outstanding.
"Permitted Liens" means, without duplication,
(i) Liens securing Senior Indebtedness permitted to be incurred
under clause (i) of the second paragraph of Section 4.7,
(ii) Liens existing on the Issue Date,
(iii) Liens in favor of either of the Issuers or any Subsidiary
thereof, provided that if such Liens are on any Collateral as defined in
the Collateral Trust Agreement, that such Liens are either collaterally
assigned to the Collateral Agent or the Trustee or subordinated to the
Lien in favor of the Collateral Agent securing the Senior Notes,
(iv) Liens on property of a Person existing at the time such
Person becomes a Subsidiary of, or is acquired by, merged into or
consolidated with either of the Issuers or any Subsidiary thereof, or
such property is otherwise acquired by either of the Issuers or a
Subsidiary thereof; provided, however, that such Liens (a) were not
created in connection with or in anticipation of such acquisition, merger
or consolidation or such Person becoming a Subsidiary and (b) are not
applicable to any other property of either of the Issuers or any of the
other Subsidiaries of the Issuers,
(v) Liens for taxes, assessments, governmental charges, levies or
claims that are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and diligently
conducted; provided, however, that any reserve or other appropriate
provision as shall be required in conformity with GAAP shall have been
made therefor,
18
(vi) landlords', carriers', warehousemen's, mechanics',
materialmen's, repairmen's or other like Liens arising in the ordinary
course of business and with respect to amounts which are not yet
delinquent or are being contested in good faith by appropriate
proceedings,
(vii) Liens incurred or deposits made in the ordinary course of
business (a) to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of Indebtedness), statutory
obligations and other similar obligations, or arising as a result of
progress payments under government contracts, (b) in connection with
workers' compensation, unemployment insurance and other social security
legislation, or (c) to secure the performance of surety bonds, and appeal
bonds required in connection with judgments that are not paid by an
unaffiliated insurance carrier pursuant to any insurance policy
maintained by the Issuers,
(viii) easements, rights-of-way, restrictions, encroachments and
other minor defects or irregularities in title, in each case that do not
and will not interfere in any material respect with the ordinary conduct
of the business of the Issuers or any of their Subsidiaries,
(ix) Liens to secure Purchase Money Indebtedness that is otherwise
permitted under this Indenture; provided, however, that (a) any such Lien
is solely for the purpose of securing Indebtedness representing, or
incurred to finance, refinance or refund, the cost (including sales and
excise taxes, installation and delivery charges and other direct costs
of, and other direct expenses paid or charged in connection with, such a
purchase or construction) of such Property, (b) the principal amount of
the Indebtedness secured by such Lien does not exceed 100% of such costs,
(c) the principal amount of all Purchase Money Indebtedness secured by
such Liens does not exceed $7.5 million at any time, (d) such Lien does
not extend to or cover any Property other than such item or items of
Property and any improvements on such item(s) and (e) such Lien is
granted within 180 days of the incurrence of such Purchase Money
Indebtedness,
(x) Liens securing Capitalized Lease Obligations permitted to be
incurred under clause (v) of the second paragraph of Section 4.7 hereof;
provided, however, that such Lien does not extend to any property other
than that subject to the underlying lease,
(xi) Liens pursuant to leases and subleases of real property which
do not interfere with the ordinary conduct of the business of the Issuers
or any of their Subsidiaries and which are made on customary and usual
terms applicable to similar properties,
(xii) Liens securing reimbursement obligations under commercial
letters of credit, but only in or upon the goods the purchase of which
were financed by such letters of credit,
19
(xiii) Liens securing Acquisition Indebtedness, PROVIDED that such
Liens do not extend to or cover any property other than the property
directly or indirectly acquired with the proceeds of such Acquisition
Indebtedness and any improvements thereto (unless such Liens are
otherwise Permitted Liens),
(xiv) Liens securing Refinancing Indebtedness; PROVIDED, HOWEVER,
that such Liens extend only to the assets securing the Indebtedness being
extended, refinanced, renewed or replaced, and such Indebtedness was
previously secured by such asset and PROVIDED, FURTHER, the terms of such
Liens are no less favorable to the holders of the Senior Notes than the
Liens being extended, refinanced, renewed or replaced,
(xv) Liens in favor of the Collateral Agent for the benefit of the
holders of the Senior Notes,
(xvi) any Lien provided for in the Plan of Reorganization or as
part of any settlement or restructuring entered into prior to the Issue
Date and approved by the Bankruptcy Court,
(xvii) Liens solely on any ▇▇▇▇ ▇▇▇▇▇▇▇ money deposits made by the
Issuers or any of their Subsidiaries in connection with any letter of
intent or purchase agreement permitted hereunder,
(xviii) purported Liens evidenced by the filing of precautionary
UCC financing statements relating solely to operating leases of personal
property entered into in the ordinary course of business,
(xix) Liens in favor of customs and revenue authorities arising as
a matter of law to secure payment of customs duties in connection with
the importation of goods,
(xx) any zoning or similar law or right reserved to or vested in
any governmental office or agency to control or regulate the use of any
real property,
(xxi) licenses of patents, trademarks and other intellectual
property rights granted by the Issuers or any of their Subsidiaries in
the ordinary course of business and not interfering in any material
respect with the ordinary conduct of the business of the Issuers or such
Subsidiaries,
(xxii) Liens arising out of attachments, judgments or awards as to
which an appeal or other appropriate proceedings for contest or review
are timely commenced (and as to which foreclosure and other enforcement
proceedings shall not have been commenced, unless fully bonded or
otherwise effectively stayed) and as to which appropriate reserves have
been established in accordance with GAAP,
20
(xxiii) other Liens on assets of the Issuers or their Subsidiaries
securing Indebtedness having an aggregate principal amount at any one
time outstanding not to exceed $5 million, and
(xxiv) any deposit or trust established pursuant to Section 9.4.
"Person" means any individual, corporation, partnership, limited
liability company or partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government (including any agency
or political subdivision thereof).
"Plan Disclosure Statement" means that certain Disclosure Statement
Pursuant to Section 1125 of the Bankruptcy Code for the Debtors' Joint Plan or
Reorganization Under Chapter 11 of the Bankruptcy Code, as approved by the
Bankruptcy Court for use by the Issuers in soliciting votes on the Plan of
Reorganization, including all schedules and exhibits thereto and all documents
incorporated by reference therein or contained in the documentary supplement
thereto.
"Plan of Reorganization" means the Debtors' Joint Plan of Reorganization
Under Chapter 11 of the Bankruptcy Code, as confirmed by an order of the United
States Bankruptcy Court for the District of Delaware, dated October 22, 2003,
including all schedules and exhibits thereto and all documents incorporated by
reference therein or contained in the documentary supplement thereto.
"Plan of Reorganization Preferred Stock" means the $5 million of
preferred stock of Intermediate Holdco issued pursuant to the Plan of
Reorganization.
"Preferred Equity Interest" means any Equity Interest of either of the
Issuers or any of their Subsidiaries, however designated, which entitles the
holder thereof to a preference with respect to dividends, distributions or
liquidation proceeds of such Person over the holders of any other Equity
Interest issued by such Person.
"principal" of a debt security means the principal amount of the security
plus, when appropriate, the premium, if any, on the security.
"Proceeding" means a liquidation, dissolution, bankruptcy, insolvency
reorganization, receivership or similar proceeding under Bankruptcy Law, an
assignment for the benefit of creditors, any marshalling of assets or
liabilities or winding up or dissolution, but shall not include any transaction
permitted by and made in compliance with Article 5 hereof.
"Property" or "property" of any Person means all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included in the most recent consolidated balance sheet of such Person and its
Subsidiaries under GAAP.
"Purchase Money Indebtedness" means any Indebtedness incurred in the
ordinary course of business by a Person to finance the cost (including the cost
of construction) of an item of Property, the principal amount of which
Indebtedness does not exceed the sum of (i) 100% of such cost and (ii)
reasonable fees and expenses of such Person incurred in connection therewith.
21
"Redemption Date" when used with respect to any Senior Note to be
redeemed means the date fixed for such redemption pursuant to this Indenture.
"Refinancing Indebtedness" means Indebtedness that refunds, refinances,
renews, replaces or extends any Indebtedness of either of the Issuers or their
Subsidiaries outstanding on the Issue Date (other than Indebtedness incurred
under the Credit Facility) or other Indebtedness permitted to be incurred by the
Issuers or any Guarantor pursuant to the first paragraph of Section 4.7, whether
involving the same or any other lender or creditor or group of lenders or
creditors, but only to the extent that (i) the Refinancing Indebtedness is
subordinated to the Senior Notes to at least the same extent as the Indebtedness
being refunded, refinanced or extended, if at all, (ii) the Refinancing
Indebtedness is scheduled to mature either (a) no earlier than the Indebtedness
being refunded, refinanced or extended, or (b) after the maturity date of the
Senior Notes, (iii) such Refinancing Indebtedness has a weighted average life to
maturity at the time such Refinancing Indebtedness is incurred that is equal to
or greater than the weighted average life to maturity of the Indebtedness being
refunded, refinanced or extended, (iv) such Refinancing Indebtedness is in an
aggregate principal amount that is less than or equal to the aggregate principal
amount then outstanding under the Indebtedness being refunded, refinanced or
extended, plus reasonable transaction costs and expenses incurred by the Issuers
and their Subsidiaries in connection with consummating such Refinancing
Indebtedness and (v) such Refinancing Indebtedness is incurred by the same
Person that initially incurred the Indebtedness being refunded, refinanced or
extended, except that either of the Issuers may incur Refinancing Indebtedness
to refund, refinance or extend Indebtedness of any of its Wholly-Owned
Subsidiary or any Person that, contemporaneously with such refunding,
refinancing or extension of Indebtedness, will become a Wholly-Owned Subsidiary
of either of the Issuers.
"Refinancing Notes" means debt securities issued to redeem the Senior
Notes.
"Responsible Officer" shall mean, when used with respect to the Trustee,
any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant treasurer, trust officer or
any other officer of the Trustee who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of such
person's knowledge of and familiarity with the particular subject and who shall
have direct responsibility for the administration of this Indenture.
"Restoration" means the restoration of all or any portion of the
Collateral in connection with any destruction or Condemnation thereof.
"Restricted Payment" means any of the following: (i) the declaration or
payment of any dividend or any other distribution or payment on Equity Interests
of either of the Issuers or any Subsidiary thereof or any payment made to the
direct or indirect holders (in their capacities as such) of Equity Interests of
either of the Issuers or any Subsidiary thereof (other than (a) in the case of
Subsidiaries of either of the Issuers, dividends or distributions payable to
either of the Issuers or to a Wholly-Owned Subsidiary of either of the Issuers,
or (b) dividends or distributions payable solely in the Equity Interests of
Intermediate Holdco or Holdings) (other than Disqualified Equity Interests) and
any payments of dividends with respect to the Plan of Reorganization Preferred
Stock in an amount not to exceed $2.375 million in the aggregate as long as any
of the Senior
22
Notes are outstanding, (ii) the purchase, redemption or other acquisition or
retirement for value of any Equity Interest of either of the Issuers or any
Subsidiary thereof (other than Equity Interests owned by either of the Issuers
or a Wholly-Owned Subsidiary, excluding Disqualified Equity Interests), (iii)
the making of any principal payment on, or the purchase, defeasance, repurchase,
redemption or other acquisition or retirement for value, prior to any scheduled
maturity, scheduled repayment or scheduled sinking fund payment, of any
Subordinated Indebtedness (other than Subordinated Indebtedness acquired in
anticipation of satisfying a scheduled sinking fund obligation, principal
installment or final maturity, in each case within one year of the date of such
acquisition), or (iv) the making of any Investment or guarantee of any
Investment in any Person other than a Permitted Investment. For purposes of
determining the amount expended for Restricted Payments, cash distributed or
invested shall be valued at the face amount thereof and property other than cash
shall be valued at its fair market value.
"S&P" means Standard & Poor's Ratings Group and its successors.
"Sale and Lease-Back Transaction" means any arrangement with any Person
providing for the leasing by either of the Issuers or any Subsidiary of either
of the Issuers of any real or tangible personal Property, which Property (i) has
been or is to be sold, conveyed or transferred by either of the Issuers or such
Subsidiary to such Person in contemplation of such leasing and (ii) would
constitute an Asset Sale if such Property had been sold in an outright sale
thereof.
"SEC" or "Commission" means the United States Securities and Exchange
Commission as constituted from time to time or any successor performing
substantially the same functions.
"Second Interest Payment Date" means the second Interest Payment Date
after the Issue Date.
"Securities" means any stock, shares, partnership interests, membership
interests, voting trust certificates, certificates of interest or participation
in any profit-sharing agreement or arrangement, options, warrants, bonds,
debentures, notes, or other evidences of indebtedness, secured or unsecured,
convertible, subordinated or otherwise, or in general any instruments commonly
known as "securities" or any certificates of interest, shares or participations
in temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means the following obligations, whether
outstanding on the Issue Date or thereafter incurred: all Indebtedness and other
monetary obligations of Holdings, Primary Intermediate Holdco, Secondary
Intermediate Holdco, the Issuers or any Subsidiary of the Issuers under or in
respect of the Credit Facility (including obligations in respect of any lease
financing facility of the Credit Facility) or, for so long as the Credit
Facility is outstanding, any Interest Rate Agreement or Currency Agreement
related to Indebtedness under the Credit Facility, whether for principal,
interest (including interest accruing after the filing of a petition by or
against either of the Issuers or any Subsidiary of either of the Issuers under
any state or federal Bankruptcy Laws, whether or not such interest is allowed as
a claim after such filing in any proceeding under such law), fees, expenses,
indemnification or otherwise
23
"Senior Note Documents" means this Indenture, the Senior Notes, the
Guarantees, the Collateral Documents and all other documents and instruments
entered into in connection with this Indenture.
"Senior Note Obligations" shall mean all obligations of any nature of any
Guarantor or of the Issuers from time to time owed to the Trustee, Collateral
Agent or to any Holder under any Senior Note, this Indenture or any other Senior
Note Document, whether for principal, premium, if any, interest (including
interest which, but for the filing of a petition in bankruptcy with respect to
either of the Issuers or any Guarantor (as the case may be), would have accrued
on any Senior Note Obligation, whether or not a claim is allowed against the
Issuers or any Guarantor (as the case may be) for such interest in the related
bankruptcy proceeding), fees, expenses, indemnification or otherwise.
"Senior Notes" means collectively the Second Priority Secured Notes due
2008, being the securities that are issued under this Indenture, as amended or
supplemented from time to time pursuant to this Indenture and including, without
limitation, any Secondary Senior Notes and notes issued in accordance with
Section 2.2 hereof.
"Subordinated Indebtedness" means Indebtedness of any Person which is
expressly subordinated in right of payment to any other Indebtedness of such
Person.
"Subsidiary" of any specified Person means any corporation, partnership,
limited liability company, joint venture, association or other business entity,
whether now existing or hereafter organized or acquired, (i) in the case of a
corporation, of which more than 50% of the total voting power of the Equity
Interests entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, officers or trustees thereof is held by such
first-named Person or any of its Subsidiaries; or (ii) in the case of a
partnership, limited liability company, joint venture, association or other
business entity, with respect to which such first-named Person or any of its
Subsidiaries has the power to direct or cause the direction of the management
and policies of such entity by contract or otherwise or if in accordance with
GAAP such entity is consolidated with the first-named Person for financial
statement purposes. Notwithstanding the foregoing, an Unrestricted Subsidiary
shall not be deemed a Subsidiary of either of the Issuers other than for
purposes of the definition of Unrestricted Subsidiary, unless the respective
Issuer shall have designated such Unrestricted Subsidiary as a "Subsidiary" by
written notice to the Trustee.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb) as in effect on the date of this Indenture (except as provided in
Section 8.3 hereof).
"Temporary Cash Investments" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least P-1 from Moody's; (iii)
24
commercial paper maturing no more than one year from the date of creation
thereof and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least P-1 from Moody's; (iv) certificates of deposit or
bankers' acceptances maturing within one year after such date and issued or
accepted by any lender under the Credit Agreement or by any commercial bank
organized under the laws of the United States of America or any state thereof or
the District of Columbia that (a) is at least "adequately capitalized" (as
defined in the regulations of its primary Federal banking regulator) and (b) has
Tier 1 capital (as defined in such regulations) of not less than $100,000,000;
and (v) shares of any money market mutual fund that (a) has substantially all 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 $500,000,000,
and (c) has the highest rating obtainable from either S&P or Moody's.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Unrestricted Subsidiary" means (i) any of the entities listed on
Schedule 1.1E, (ii) any Subsidiary of an Unrestricted Subsidiary and (iv) any
Subsidiary of either of the Issuers which shall have been designated after the
Issue Date as an Unrestricted Subsidiary by a resolution adopted by the Board of
Directors of the Issuer which is the direct parent of such Wholly-Owned
Subsidiary; PROVIDED that a Subsidiary may be so classified as an Unrestricted
Subsidiary only if such classification is in compliance with Section 4.14 hereof
and an Unrestricted Subsidiary may be designated as a Subsidiary only if such
classification is in compliance with the definition of "Subsidiary" contained in
this Section 1.1. The Trustee shall be given prompt written notice by the Issuer
which is the direct parent of such Wholly-Owned Subsidiary of each resolution
adopted by the Board of Directors of the Issuer which is the direct parent of
such Wholly-Owned Subsidiary under this provision, together with a copy of each
such resolution adopted.
"U.S. Government Obligations" means (i) securities that are direct
obligations of the United States of America for the payment of which its full
faith and credit are pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the Issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depository receipt; PROVIDED that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt.
"Wholly-Owned Subsidiary" means any Subsidiary all of the outstanding
Equity Interests (other than directors' qualifying shares) of which are owned,
directly or indirectly, by either of the Issuers.
25
SECTION 1.2. OTHER DEFINITIONS. The definitions of the following terms
may be found in the Sections indicated as follows:
Term Defined in Section
---- ------------------
"Affiliate Transaction" 4.11
"Agent Members" 2.15
"Business Day" 12.8
"Change of Control Date" 4.6
"Change of Control Offer" 4.6
"Change of Control Payment Date" 4.6
"Change of Control Redemption Period" 4.6
"Collateral Proceeds Amount" 4.10
"Collateral Proceeds Offer" 4.10
"Covenant Defeasance" 9.3
"Event of Default" 6.1
"Legal Defeasance" 9.2
"Legal Holiday" 12.8
"Paying Agent" 2.3
"Physical Notes" 2.1
"Registrar" 2.3
"Required Filing Date" 4.2
"Secondary Senior Notes" 2.2
"transfer" 5.1
SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever
this Indenture refers to a provision of the TIA, the portion of such provision
required to be incorporated herein in order for this Indenture to be qualified
under the TIA is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Senior Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor on the indenture securities" means the Issuers, the Guarantors
or any other obligor on the Senior Notes.
All other terms used in this Indenture that are defined by the TIA,
defined in the TIA by reference to another statute or defined by SEC rule have
the meanings therein assigned to them.
SECTION 1.4. RULES OF CONSTRUCTION. Unless the context otherwise
requires:
26
(1) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) words used herein implying any gender shall apply to every
gender;
(6) "herein," "hereof' and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
Subdivision, unless expressly stated otherwise; and
(7) provisions apply to successive events and transactions.
ARTICLE 2
The Senior Notes
----------------
SECTION 2.1. DATING; INCORPORATION OF FORM IN INDENTURE. The Senior Notes
and the Trustee's certificate of authentication shall be substantially in the
form of Exhibit A which is incorporated in and made part of this Indenture. The
Senior Notes shall have notations, legends or endorsements required by law,
stock exchange rule, usage, or agreements to which each of the Issuers or any
Guarantor is subject. The Issuers shall use "CUSIP" numbers in issuing the
Senior Notes. Each Senior Note shall be dated the date of its authentication.
One or more permanent Global Notes issued and delivered hereunder may be
in registered form, substantially in the form set forth in Exhibit A, having the
legend set forth in Exhibit B, may be issued to the Depository, to the extent
such Depository is the Registered Holder of the applicable Senior Notes.
Otherwise, Senior Notes hereunder may be issued in the form of certificated
Senior Notes in registered form in substantially the form set forth in Exhibit A
(the "Physical Notes"), without the legend set forth in Exhibit B.
The terms and provisions contained in the Senior Notes and the Guarantees
shall constitute, and are hereby expressly made, a part of this Indenture and
the Issuers, the Guarantors and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions and to be bound
thereby.
SECTION 2.2. EXECUTION AND AUTHENTICATION. The Senior Notes shall be
executed on behalf of the Issuers by two Officers of each of the respective
Issuers or an Officer and an Assistant Secretary of each of the Issuers. Such
signatures may be either manual or facsimile. If an Officer whose signature is
on a Senior Note no longer holds that office at the time the Trustee
authenticates the Senior Note or at any time thereafter, the Senior Note shall
be valid nevertheless.
27
A Senior Note shall not be valid until the Trustee manually signs the
certificate of authentication on the Senior Note. Such signature shall be
conclusive evidence that the Senior Note has been authenticated under this
Indenture.
The Trustee or an authenticating agent shall authenticate Senior Notes
for original issue in the aggregate principal amount of up to $145,000,000,
subject to adjustment pursuant to Section 8.1(7). The aggregate principal amount
of Senior Notes, excluding Secondary Senior Notes, outstanding at any time may
not exceed such amount except as provided in Section 2.7. The Senior Notes shall
be issuable only in registered form without coupons and only in denominations of
whole dollar integrals. The Trustee shall issue Senior Notes upon the Issuers'
Request.
In the event the Issuers elect to pay a portion of interest as specified
in the terms of the Senior Notes in additional Senior Notes, the Issuers shall
pay a portion of such interest in Secondary Senior Notes in lieu of cash as
provided in paragraph 1 of the Senior Notes (such Senior Notes, "Secondary
Senior Notes"). The Issuers shall give written notice to the Trustee of the
amount of interest to be paid in Secondary Senior Notes not less than five
Business Days prior to the relevant Interest Payment Date, and the Trustee or an
authenticating agent (upon written order of the Issuers signed by an Officer of
each of the Issuers given not less than five nor more than 45 days prior to such
Interest Payment Date) shall authenticate for original issue (pro rata to each
Holder of any Senior Notes as of such record date) Secondary Senior Notes in an
aggregate principal amount equal to the amount of interest payable with such
Secondary Senior Notes on such Interest Payment Date. Each issuance of Secondary
Senior Notes in lieu of the payment of a portion of interest in cash on the
Senior Notes shall be made pro rata with respect to the outstanding Senior
Notes, and the Issuers shall have the right to aggregate amounts of interest
payable in the form of Secondary Senior Notes to a Holder of outstanding Senior
Notes and issue to such Holder a single Secondary Senior Note in payment
thereof. Any Secondary Senior Notes may be denominated as a separate series if
the Issuers deem it necessary to do so, with appropriate distinguishing
designations. As set forth in paragraph 1 of the Senior Notes, in the event the
Issuers elect to pay a portion of interest in Secondary Senior Notes, the
Issuers shall also pay to each Holder, on a pro rata basis, an additional
amount, payable in cash on the date(s) specified in paragraph 1 of the Senior
Notes in an amount equal to 0.25% of the aggregate amount of Senior Notes
outstanding as of the applicable record date for such Interest Payment (such
amounts, "Additional Amounts").
The Trustee may appoint an authenticating agent acceptable to the Issuers
to authenticate Senior Notes. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Senior Notes whenever the Trustee may
do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. Such authenticating agent shall have the
same right as the Trustee in dealing with the Issuers or an Affiliate.
SECTION 2.3. AGENTS. Each of the Issuers shall maintain an office or
agency in the Borough of Manhattan, City of New York, State of New York where
Senior Notes may be presented for registration of transfer or for exchange
("Registrar") and where Senior Notes may be presented for payment ("Paying
Agent") and where notices and demands to or upon the Issuers in respect of the
Senior Notes and this Indenture may be served. The Registrar shall keep a
register of the Senior Notes and of their transfer and exchange. The Issuers may
appoint one or
28
more co-Registrars and one or more additional Paying Agents. The Issuers may
change any Paying Agent, Registrar or co-Registrar without notice to any
Noteholder. Neither the Issuers nor any of their Subsidiaries or Affiliates may
act as Paying Agent but may act as Registrar or co-Registrar.
The Issuers shall enter into an appropriate agency agreement with any
Registrar or Paying Agent which is not a party to this Indenture. The agreement
shall implement the provisions of this Indenture that relate to such Agent. The
Issuers shall notify the Trustee of the name and address of any such Agent. If
the Issuers fail to maintain a Registrar or Paying Agent, or agent for service
of notices and demands, or fail to give the foregoing notice, the Trustee shall
act as such and shall be entitled to appropriate compensation pursuant to
Section 7.7. The Issuers initially appoint the Trustee as Registrar, Paying
Agent and agent for service of notices and demands in connection with the Senior
Notes.
SECTION 2.4. PAYING AGENT TO HOLD MONEY IN TRUST. On or before each due
date of the principal of, premium if any, interest or Additional Amounts, if
any, on any Senior Notes, the Issuers shall deposit with the Paying Agent a sum
sufficient to pay such principal, premium if any, or interest so becoming due.
Each Paying Agent shall hold in trust for the benefit of Noteholders or the
Trustee all money held by the Paying Agent for the payment of principal of or
interest or Additional Amounts, if any, on the Senior Notes (whether such money
has been paid to it by the Issuers or any other obligor on the Senior Notes),
and the Issuers and the Paying Agent shall notify the Trustee of any default by
either of the Issuers or any Guarantor (or any other obligor on the Senior
Notes) in making any such payment. Money held in trust by the Paying Agent need
not be segregated except as required by law and in no event shall the Paying
Agent be liable for any interest on any money received by it hereunder. The
Issuers at any time may require a Paying Agent to pay all money held by it to
the Trustee, and the Trustee may at any time during the continuance of any Event
of Default specified in Section 6.1(1) or (2), upon written request to a Paying
Agent, require such Paying Agent to forthwith pay to the Trustee all sums so
held in trust by such Paying Agent together with a complete accounting of such
sums. Upon doing so, the Paying Agent shall have no further liability for the
money delivered to the Trustee.
SECTION 2.5. NOTEHOLDER LISTS. The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of Noteholders. The Trustee shall provide Noteholders with
access to such list in accordance with TIA Section 312. If the Trustee is not
the Registrar, the Issuers shall furnish to the Trustee on or prior to the tenth
Business Day before each Interest Payment Date, and at such other times as the
Trustee may reasonably 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
Noteholders, including the aggregate principal amount of Senior Notes held by
each such Noteholder.
SECTION 2.6. TRANSFER AND EXCHANGE. (a) Subject to Section 2.16, when a
Senior Note is presented to the Registrar with a request to register the
transfer thereof, the Registrar shall register the transfer as requested if the
requirements of applicable law and of this Indenture are met and, when Senior
Notes are presented to the Registrar with a request to exchange them for an
equal principal amount of Senior Notes of other authorized denominations, the
Registrar shall make the exchange as requested, PROVIDED that every Senior Note
presented or surrendered
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for registration of transfer or exchange shall be duly endorsed or be
accompanied by a written instrument of transfer in form satisfactory to the
Issuers and the Registrar duly executed by the Holder thereof or his attorney,
duly authorized in writing. To permit registration of transfers and exchanges,
upon surrender of any Senior Note for registration of transfer at the office or
agency maintained pursuant to Section 2.3 hereof, the Issuers shall issue and
execute and the Trustee shall authenticate Senior Notes at the Registrar's
request. Any exchange or transfer shall be without any service charge to the
Noteholder, except that the Issuers may require payment by the Noteholder of a
sum sufficient to cover any tax or the governmental charge that may be imposed
in relation to a transfer or exchange. The Trustee shall not be required to
register transfers of Senior Notes or to exchange Senior Notes for a period of
15 days before selection of any Senior Notes to be redeemed. The Trustee shall
not be required to exchange or register transfers of any Senior Notes called or
being called for redemption in whole or in part, except the unredeemed portion
of any Senior Note being redeemed in part. All Senior Notes issued upon any
transfer or exchange pursuant to the terms of this Indenture will evidence the
same debt and will be entitled to the same benefits under this Indenture as the
Senior Notes surrendered upon such transfer or exchange.
(b) Any Holder of a Global Note shall, by acceptance of such Global Note,
agree that transfers of the beneficial interests in such Global Note may be
effected only through a book entry system maintained by the Holder of such
Global Note (or its agent), and that ownership of a beneficial interest in the
Global Note shall be required to be reflected in a book entry.
(c) Except as expressly provided herein, neither the Trustee nor the
Registrar shall have any duty to monitor the Issuers' compliance with or have
any responsibility with respect to the Issuers' compliance with any federal or
state securities laws.
SECTION 2.7. REPLACEMENT SENIOR NOTES. If a mutilated Senior Note is
surrendered to the Registrar or Trustee or if the Holder of a Senior Note
presents evidence to the satisfaction of the Issuers and the Trustee that the
Senior Note has been lost, destroyed or wrongfully taken and of the ownership
thereof, the Issuers shall issue and the Trustee shall authenticate a
replacement Senior Note if the Holder of such Senior Note furnishes to the
Issuers and the Trustee evidence reasonably acceptable to them of the ownership
and destruction, loss or theft of such Senior Note or if the reasonable
requirements of the Trustee and of Section 8-405 of the Uniform Commercial Code
as in effect in the State of Delaware are met. An indemnity bond may be required
by the Issuers or the Trustee that is sufficient in the judgment of the Issuers
and the Trustee to protect the Issuers, the Trustee or any Agent from any loss
which any of them may suffer if a Senior Note is replaced. The Issuers or the
Trustee each may charge for its expenses (including reasonable attorneys' fees
and expenses) in replacing a Senior Note.
Every replacement Senior Note is an additional obligation of the Issuers.
SECTION 2.8. OUTSTANDING SENIOR NOTES. Senior Notes outstanding at any
time are all Senior Notes authenticated by the Trustee except for those
cancelled by it, those delivered to it for cancellation, and those described in
this Section 2.8 as not outstanding.
If a Senior Note is replaced pursuant to Section 2.7, such Senior Note
that has been replaced will cease to be outstanding until the Issuers and the
Trustee receive proof satisfactory
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to each of them that the replaced Senior Note is held by a bona fide purchaser
in whose hands such obligation is a legal, valid and binding obligation of the
Issuers.
If a Paying Agent holds on a Redemption Date or Maturity Date money
sufficient to pay the principal of, premium, if any, and all accrued interest
with respect to Senior Notes payable on that date and is not prohibited from
paying such money to the Holders thereof pursuant to the terms of this
Indenture, then on and after that date such Senior Notes shall cease to be
outstanding and interest on them shall cease to accrue.
Subject to Section 12.6, a Senior Note does not cease to be outstanding
solely because the Issuers or an Affiliate holds the Senior Note.
SECTION 2.9. TEMPORARY SENIOR NOTES. Until definitive Senior Notes are
ready for delivery, the Issuers may prepare and the Trustee shall authenticate
temporary Senior Notes. Temporary Senior Notes shall be substantially in the
form, and shall carry all rights, benefits and privileges, of definitive Senior
Notes but may have variations that the Issuers consider appropriate for
temporary Senior Notes. Without unreasonable delay, the Issuers shall prepare
and the Trustee shall authenticate definitive Senior Notes in exchange for
temporary Senior Notes presented to it.
SECTION 2.10. CANCELLATION. The Issuers at any time may deliver Senior
Notes to the Trustee for cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Senior Notes surrendered to them for transfer,
exchange or payment. The Trustee shall cancel and retain or may dispose of
(subject to the record-retention requirements of the Exchange Act), in
accordance with its normal practice, all Senior Notes surrendered for transfer,
exchange, payment or cancellation. Subject to Section 2.7, the Issuers may not
issue new Senior Notes to replace Senior Notes in respect of which they have
previously paid all principal, premium and interest accrued thereon, or
delivered to the Trustee for cancellation.
SECTION 2.11. DEFAULTED INTEREST. If the Issuers default in a payment of
any interest on the Senior Notes, the Issuers shall pay the defaulted amounts in
cash, plus (to the extent permitted by law) any interest payable on defaulted
amounts pursuant to Section 4.1, to the persons who are Noteholders on a
subsequent special record date.
The Issuers shall fix the special record date and payment date for
payment of such defaulted amounts in a manner satisfactory to the Trustee and
provide the Trustee at least 20 days notice of the proposed amount of defaulted
interest to be paid and the special payment date. At least 15 days before the
special record date, the Issuers shall mail or cause to be mailed to each
Noteholder at his address as it appears on the Senior Notes register maintained
by the Registrar a notice that states the special record date, the payment date
(which shall be not less than five nor more than ten days after the special
record date), and the amount to be paid. In lieu of the foregoing procedures,
the Issuers may pay defaulted interest in any other lawful manner satisfactory
to the Trustee.
SECTION 2.12. DEPOSIT OF MONEYS. Prior to 10:00 a.m., New York City time,
as required, on (i) each Interest Payment Date and (ii) the Maturity Date, the
Issuers shall have deposited with the Paying Agent in immediately available
funds money sufficient to make cash
31
payments, if any, due on such Interest Payment Date or Maturity Date, as the
case may be, in a timely manner which permits the Trustee to remit payment to
the Holders at such times. The principal and interest on Global Notes shall be
payable to the Depository or its nominee, as the case may be, as the sole
registered owner and the sole holder of the Global Notes represented thereby.
The principal and interest on Physical Notes shall be payable at the office of
the Paying Agent.
SECTION 2.13. CUSIP NUMBER. The Issuers in issuing the Senior Notes may
use a "CUSIP" number (or numbers), and if so, the Trustee may use the CUSIP
number(s) in notices of redemption or exchange as a convenience to Holders,
provided that any such notice may state that no representation is made as to the
correctness or accuracy of the CUSIP number(s) printed in the notice or on the
Senior Notes, and that reliance may be placed only on the other identification
numbers printed on the Senior Notes. The Issuers will promptly notify in writing
the Trustee of any such CUSIP number used by the Issuers in connection with the
Senior Notes and any change in such CUSIP number.
SECTION 2.14. PAYMENTS TO HOLDERS. Notwithstanding any provisions of this
Indenture and the Senior Notes to the contrary:
(a) Except for any payments to be made on a Redemption Date or the
Maturity Date, payments with respect to any of the Senior Notes may be made by
the Paying Agent upon receipt from the Issuers of immediately available funds,
by check mailed to the Holder, at the address shown in the registrar of the
Senior Notes maintained by the Registrar pursuant to Section 2.3; or
(b) At the request of a Holder of at least $5 million in aggregate
principal amount of Senior Notes outstanding, all payments with respect to any
of the Senior Notes may be made by the Paying Agent upon receipt from the
Issuers of immediately available funds prior to 10:00 a.m., New York City time,
directly to the Holder of such Senior Note (whether by federal funds, wire
transfer or otherwise); provided, however, that no such federal funds, wire
transfer or other such direct payment shall be made to any Holder under this
Section 2.14(b) unless such Holder has delivered written instructions to the
Trustee prior to the relevant record date for such payment requesting that such
payment will be so made and designating the bank account to which such payments
shall be so made and, in the case of payments of principal, surrenders the
Senior Note to the Trustee in exchange for a Senior Note or Senior Notes
aggregating the same principal amount as the unredeemed principal amount of the
Senior Notes surrendered. The Trustee shall be entitled to rely on the last
instruction delivered by the Holder pursuant to this Section 2.14(b) unless a
new instruction is delivered prior to the relevant record date for a payment
date. The Issuers will indemnify and hold the Trustee harmless against any loss,
liability or expense (including reasonable attorneys' fees and expenses)
resulting from any act or omission to act on the part of the Issuers or any such
Holder in connection with any such agreement or which the Paying Agent may incur
as a result of making any payment in accordance with any such agreement, except
for any such loss, liability or expense arising as a result of the gross
negligence or willful misconduct of the Trustee or the Paying Agent, as the case
may be.
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All payments made on a Redemption Date are subject to Section 2.8 and
Article 3 hereof. No later than fifteen (15) days prior to the Maturity Date,
the Trustee shall notify the Holder, at the address shown in the registrar of
the Senior Notes maintained by the Registrar pursuant to Section 2.3 hereof,
that the Issuers expect that the final installment of principal of and interest
on the Senior Notes will be paid on the Maturity Date. Such notice shall specify
that such final installment will be payable only upon presentation and surrender
of such Senior Note and shall specify the place where such Senior Notes may be
presented and surrendered for payment of such installment. Additionally, in
accordance with Section 2.8, such Senior Notes shall cease to be outstanding.
SECTION 2.15. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES.
(a) The Global Notes initially shall (i) be registered in the name of the
Depository or the nominee of such Depository, (ii) be delivered to the Trustee
as custodian for such Depository and (iii) bear legends as set forth in
Exhibit B.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Note, and the Depository may be treated by the Issuers, the Trustee and
any agent of the Issuers or the Trustee as the absolute owner of the Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Issuers, the Trustee or any agent of the Issuers or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Senior Note.
(b) Transfers of Global Notes shall be limited to transfer in whole, but
not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in the Global Notes may be transferred or
exchanged for Physical Notes in accordance with the rules and procedures of the
Depository. In addition, Physical Notes shall be transferred to all beneficial
owners in exchange for their beneficial interests in Global Notes if (i) the
Depository notifies the Issuers that it is unwilling or unable to continue as
Depository for any Global Note and a successor depositary is not appointed by
the Issuers within 90 days of such notice or (ii) an Event of Default has
occurred and is continuing and the Registrar has received a written request from
the Depository to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Issuers
shall execute, and the Trustee shall upon receipt of a written order from the
Issuers authenticate and make available for delivery, one or more Physical Notes
of like tenor and amount.
(d) In connection with the transfer of Global Notes as an entirety to
beneficial owners pursuant to paragraph (b), the Global Notes shall be deemed to
be surrendered to the Trustee for cancellation, and the Issuers shall execute,
and the Trustee shall authenticate and
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deliver, to each beneficial owner identified by the Depository in writing in
exchange for its beneficial interest in the Global Notes, an equal aggregate
principal amount of Physical Notes of authorized denominations.
(e) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture, the Senior Notes or the Guarantees.
SECTION 2.16. RECORD DATE. The record date for purposes of determining
the identity of Holders entitled to vote or consent to any action by vote or
consent authorized or permitted under this Indenture shall be determined as
provided in TIA Section 316(c).
ARTICLE 3
Redemption
----------
SECTION 3.1. NOTICES TO TRUSTEE. If the Issuers elect to redeem Senior
Notes pursuant to Section 3.7 hereof, at least 30 days prior to the Redemption
Date (or such shorter period prior to the Redemption Date as the Trustee may
agree to in writing), the Issuers shall notify the Trustee in writing of the
Redemption Date, the principal amount of Senior Notes to be redeemed and the
redemption price, and each of the Issuers shall and deliver to the Trustee an
Officers' Certificate stating that such redemption will comply with the
conditions contained in Section 3.7 hereof.
SECTION 3.2. SELECTION BY TRUSTEE OF SENIOR NOTES TO BE REDEEMED. In the
event that fewer than all of the Senior Notes are to be redeemed, the Trustee
shall select the Senior Notes to be redeemed, if the Senior Notes are listed on
a national securities exchange, in accordance with the rules of such exchange
or, if the Senior Notes are not so listed, on either a pro rata basis or by lot,
or such other method as it shall deem fair and equitable. As soon as practicable
but in not less than 20 days prior to the Redemption Date, the Trustee shall
notify the Issuers of the Senior Notes selected for redemption and, in the case
of any Senior Notes selected for partial redemption, the principal amount
thereof to be redeemed. The Trustee may select for redemption portions of the
principal of the Senior Notes that have denominations larger than $1,000. Senior
Notes and portions thereof the Trustee selects shall be redeemed in amounts of
$1,000 or whole multiples of $1,000. For all purposes of this Indenture unless
the context otherwise requires, provisions of this Indenture that apply to
Senior Notes called for redemption also apply to portions of Senior Notes called
for redemption.
SECTION 3.3. NOTICE OF REDEMPTION. At least 15 days, but no more than 30
days, before a Redemption Date, the Issuers shall mail, or cause to be mailed, a
notice of redemption by first-class mail to each Holder of Senior Notes to be
redeemed at each Holder's last address as the same appears on the registry books
maintained by the Registrar pursuant to Section 2.3 hereof.
The notice shall identify the Senior Notes to be redeemed (including the
CUSIP number(s) thereof) and shall state:
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(1) the Redemption Date;
(2) the redemption price and the amount of accrued
interest, if any, to be paid (or the method by which any such amount of accrued
interest to be paid is to be calculated);
(3) if any Senior Note is being redeemed in part, the
portion of the principal amount of such Senior Note to be redeemed and that,
after the Redemption Date and upon surrender of such Senior Note, a new Senior
Note or Senior Notes in principal amount equal to the unredeemed portion will be
issued;
(4) the name and address of the Paying Agent;
(5) that Senior Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(6) that unless the Issuers default in making the
redemption payment, interest on Senior Notes called for redemption ceases to
accrue on and after the Redemption Date and that the only remaining right of the
Holders of such Senior Notes is to receive payment of the Senior Notes
redemption price upon surrender to the Paying Agent of the Senior Notes
redeemed; and
(7) the aggregate principal amount of Senior Notes that are
being redeemed.
At the Issuers' request, the Trustee shall give the notice of redemption
in the Issuers' names and at the Issuers' expense.
SECTION 3.4. EFFECT OF NOTICE OF REDEMPTION. Once the notice of
redemption described in Section 3.3 is mailed, Senior Notes called for
redemption become due and payable on the Redemption Date and at the redemption
price, including any premium, plus interest accrued to the Redemption Date. Upon
surrender to the Paying Agent, such Senior Notes shall be paid at the redemption
price, including any premium, plus interest accrued to the Redemption Date,
provided that if the Redemption Date is after a regular interest payment record
date and on or prior to the applicable Interest Payment Date, the accrued
interest shall be payable to the Holder of the redeemed Senior Notes registered
on the relevant record date, and provided, further, that if a Redemption Date is
a Legal Holiday, payment shall be made on the next succeeding Business Day and
no interest shall accrue for the period from such Redemption Date to such
succeeding Business Day.
SECTION 3.5. DEPOSIT OF REDEMPTION PRICE. On or prior to 10:00 a.m., New
York City time, on each Redemption Date, the Issuers shall deposit with the
Paying Agent in immediately available funds money sufficient to pay the
redemption price of and accrued interest on all Senior Notes to be redeemed on
that date other than Senior Notes or portions thereof called for redemption on
that date which have been delivered by the Issuers to the Trustee for
cancellation.
On and after any Redemption Date, if money sufficient to pay the
redemption price of and accrued interest on Senior Notes called for redemption
shall have been made available in accordance with the preceding paragraph and
payment thereof is not prohibited pursuant to the
35
terms of this Indenture, the Senior Notes called for redemption will cease to
accrue interest and the only right of the Holders of such Senior Notes will be
to receive payment of the redemption price of and, subject to the first proviso
in Section 3.4, accrued and unpaid interest on such Senior Notes to the
Redemption Date. If any Senior Note called for redemption shall not be so paid,
interest will be paid, from the Redemption Date until such redemption payment is
made, on the unpaid principal of the Senior Note and any interest not paid on
such unpaid principal, in each case, at the rate and in the manner provided in
the Senior Notes.
SECTION 3.6. SENIOR NOTES REDEEMED IN PART. Upon surrender of a Senior
Note that is redeemed in part, the Trustee shall authenticate for a Holder a new
Senior Note equal in principal amount to the unredeemed portion of the Senior
Note surrendered.
SECTION 3.7. OPTIONAL REDEMPTION. The Issuers may redeem the Senior
Notes, in whole or in part, at any time other than during the Change of Control
Redemption Period, defined in Section 4.6 below, at a redemption price equal to
100% of the principal amount thereof, plus any accrued and unpaid interest to
the Redemption Date.
ARTICLE 4
Covenants
SECTION 4.1. PAYMENT OF SENIOR NOTES. Subject to Section 1 of the Senior
Notes, the Issuers shall pay the principal of, premium, if any, and interest in
cash on the Senior Notes from the Issue Date, or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semi-annually
in arrears on each Interest Payment Date and in the manner provided in the
Senior Notes at a rate per annum of 9.5% until the principal hereof shall have
become due and payable, and in cash on any overdue principal and (without
duplication and to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the same rate per
annum compounded semi-annually. The amount of interest payable on any Interest
Payment Date shall be computed on the basis of the actual number of days elapsed
and a 360-day year.
SECTION 4.2. REPORTS. The Issuers will file with the SEC all information,
documents and reports to be filed with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act, whether or not the Issuers are subject to such filing
requirements, so long as the SEC will accept such filings on or prior to the
respective dates (such dates, including any extension granted by the SEC, the
"Required Filing Dates") by which the Issuers would have been or are required to
so file such documents. The Issuers (at their own expense) shall also in any
event within 15 days after each Required Filing Date (i) transmit by mail to all
Holders, at their addresses appearing in the register of Senior Notes maintained
by the Registrar and (ii) file with the Trustee within 15 days after the
Required Filing Date, copies of the annual 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 Issuers file with
the SEC pursuant to Section 13 or 15(d) of the Exchange Act or would be required
to file with the SEC if they were subject to Section 13 or 15(d) of the Exchange
Act. The Issuers shall comply with the provisions of TIA Section 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
36
notice of any information contained therein or determinable from information
contained therein, including the Issuers' compliance with any of their covenants
hereunder (as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 4.3. WAIVER OF STAY, EXTENSION OR USURY LAWS. Each of the Issuers
and each Guarantor covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead (as a defense or otherwise) or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law which would prohibit or forgive
either of the Issuers or any Guarantor, as the case may be, from paying all or
any portion of the principal of, premium, if any, and/or interest on the Senior
Notes as contemplated herein, wherever enacted, now or at any time hereafter in
force, or which may affect the covenants or the performance of this Indenture;
and (to the extent that it may lawfully do so) each of the Issuers and each
Guarantor hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
SECTION 4.4. COMPLIANCE CERTIFICATE. (a) Each of the Issuers and each
Guarantor (to the extent that such Guarantor is so required under the TIA) shall
deliver to the Trustee, within 120 days after the end of each fiscal year, an
Officers' Certificate (one of the signers of which shall be the principal
executive officer, principal financial officer or principal accounting officer
of such Issuer or such Guarantor, as the case may be) complying with Section
314(a)(4) of the TIA stating that a review of the activities of such Issuer or
such Guarantor, as the case may be, during such fiscal year has been made under
the supervision of the signing Officers with a view to determining whether such
Issuer or such Guarantor, as the case may be, has kept, observed, performed and
fulfilled its obligations under the Collateral Documents and this Indenture in
all material respects, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge such Issuer or such
Guarantor, as the case may be, has kept, observed, performed and fulfilled each
and every covenant contained in the Collateral Documents and this Indenture and
is not in default in the performance or observance of any of the terms,
provisions and conditions thereof or hereof (determined without regard to any
period of grace or requirement of notice provided herein), or, if a Default or
Event of Default shall have occurred, describing all or such Defaults or Events
of Default of which he or she may have knowledge and what action such Issuer or
such Guarantor, as the case may be, is taking or proposes to take with respect
thereto.
(b) Each of the Issuers and each Guarantor will, so long as any of the
Senior Notes are outstanding, deliver to the Trustee, forthwith upon any
Officer's becoming aware of any Default or Event of Default, an Officers'
Certificate specifying the nature and extent of the same in reasonable detail
and what action such Issuer or such Guarantor, as the case may be, is taking or
proposes to take with respect thereto.
SECTION 4.5. PAYMENT OF TAXES, ETC. The Issuers shall pay or discharge or
cause to be paid or discharged, before the same shall become delinquent, (a) all
taxes, assessments and governmental charges levied or imposed upon them or their
Subsidiaries' income, profits or property and (b) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a Lien upon their
property; PROVIDED, HOWEVER, that the Issuers shall not be required
37
to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim (1) whose amount, applicability or validity is being contested
in good faith by appropriate negotiations or proceedings or (2) the failure to
pay or discharge which would not have a material adverse effect on the Issuers
and their Subsidiaries, taken as a whole.
SECTION 4.6. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require that the Issuers purchase all or a portion of any
outstanding Senior Notes held by such Holder pursuant to the offer described in
paragraph (b) below (the "Change of Control Offer") at a purchase price equal to
101% of the principal amount thereof plus accrued interest, if any, to the date
of purchase. Prior to the mailing of the notice referred to below, but in any
event within 45 days following any Change of Control, the Issuers shall (i)
cause to be repaid in full and terminated all commitments under the Credit
Agreement, and all other Senior Indebtedness the terms of which require
repayment upon a Change of Control (if any), or cause to be offered to be repaid
in full and terminated all commitments under all Indebtedness under the Credit
Agreement and all such other Senior Indebtedness and to repay the Indebtedness
owed to each lender which has accepted such offer, or (ii) obtain the requisite
consents and/or waivers under the Credit Agreement and all other Senior
Indebtedness to permit the repurchase of the Senior Notes as provided below.
(b) Within 45 days following the date (the "Change of Control Date") upon
which the Change of Control occurred (the "Change of Control Redemption
Period"), the Issuers shall send, by first class mail, a notice to each Holder,
with a copy to the Trustee, which notice shall govern the terms of the Change of
Control Offer. The notice to the Holders shall contain all instructions and
materials necessary to enable such Holders to tender Senior Notes pursuant to
the Change of Control Offer. Such notice shall state:
(i) that the Change of Control Offer is being made pursuant to
this Section 4.6 and that all Senior Notes tendered and not withdrawn will be
accepted for payment;
(ii) the purchase price (including the amount of accrued interest)
and the purchase date (which shall be no earlier than 30 days nor later than 45
days from the date such notice is mailed, other than as may be required by law)
(the "Change of Control Payment Date"); provided that the Change of Control
Payment Date for the Senior Notes shall be a date subsequent to any payment
dates for the purchase or other repayment of Senior Indebtedness having similar
provisions;
(iii) that any Senior Notes not tendered will continue to accrue
interest;
(iv) that, unless the Issuers default in making payment therefor,
any Senior Notes accepted for payment pursuant to the Change of Control Offer
shall cease to accrue interest after the Change of Control Payment Date;
(v) that Holders electing to have a Senior Note purchased pursuant
to a Change of Control Offer will be required to surrender the Senior Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse of the
Senior Note completed, to the Paying
38
Agent at the address specified in the notice prior to the close of business on
the third Business Day prior to the Change of Control Payment Date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than five Business Days prior to the Change
of Control Payment Date, a facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Senior Notes the Holder
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Senior Notes purchased;
(vii) that Holders whose Senior Notes are purchased only in part
will be issued new Senior Notes in a principal amount equal to the unpurchased
portion of the Senior Notes surrendered; provided that each Senior Note
purchased and each new Senior Note issued shall be in an original principal
amount of $1,000 or integral multiples thereof; and
(viii) the circumstances and relevant material facts regarding
such Change of Control.
On or before the Change of Control Payment Date, the Issuers shall (i)
accept for payment Senior Notes or portions thereof tendered pursuant to the
Change of Control Offer and (ii) deposit with the Paying Agent U.S. legal tender
sufficient to pay the purchase price plus accrued interest, if any, of all
Senior Notes so tendered, and each of the Issuers shall deliver to the Trustee
Senior Notes so accepted together with an Officers' Certificate stating the
Senior Notes or portions thereof being purchased by the Issuers. The Paying
Agent shall promptly mail to the Holders of Senior Notes so accepted payment in
an amount equal to the purchase price plus accrued interest, if any, and the
Trustee shall promptly authenticate and mail to such Holders new Senior Notes
equal in principal amount to any unpurchased portion of the Senior Notes
surrendered. Any Senior Notes not so accepted shall be promptly mailed by the
Issuers to the Holder thereof. For purposes of this Section 4.6, the Trustee
shall act as the Paying Agent.
Any amounts remaining after the purchase of Senior Notes pursuant to a
Change of Control Offer shall be returned by the Trustee to the Issuers.
The Issuers shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Senior Notes pursuant to a Change of Control Offer. To the extent
the provisions of any securities laws or regulations conflict with the
provisions under this Section 4.6, the Issuers shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached their
obligations under this Section 4.6 by virtue thereof.
SECTION 4.7. LIMITATION ON ADDITIONAL INDEBTEDNESS. Holdings,
Intermediate Holdco and the Issuers will not, and will not permit any of their
respective Subsidiaries to, directly or indirectly, incur any Indebtedness
(including Acquired Indebtedness); PROVIDED, HOWEVER, that the Issuers or any
Guarantor may incur Indebtedness (including Acquired Indebtedness) after the
Issue Date if (i) after giving effect on a pro forma basis to the incurrence of
such Indebtedness and, to the extent set forth in the definition of Consolidated
Fixed Charge Coverage Ratio, the receipt and application of the proceeds
thereof, Holdings' Consolidated Fixed Charge Coverage
39
Ratio would be greater than 2 to 1; and (ii) no Default or Event of Default
shall have occurred and be continuing at the time or as a consequence of the
incurrence of such Indebtedness.
The foregoing paragraph shall not prohibit the incurrence of the
following:
(i) Senior Indebtedness at any time outstanding in an aggregate
principal amount not to exceed $160 million;
(ii) Indebtedness under or in connection with the Senior Notes and
the Guarantees;
(iii) Any other Indebtedness provided for in the Plan of
Reorganization (including without limitation the Brownwood Lease);
(iv) Refinancing Indebtedness;
(v) Capitalized Lease Obligations and/or Purchase Money
Indebtedness in an aggregate principal amount outstanding at any time not to
exceed $12.5 million;
(vi) Indebtedness of a Subsidiary issued to and held by either of
the Issuers or a Subsidiary or Indebtedness of either of the Issuers to a
Subsidiary in respect of intercompany advances or transactions;
(vii) Indebtedness in respect of non-speculative Interest Rate
Agreements; PROVIDED that the notional principal amount related to such
non-speculative Interest Rate Agreement does not exceed the principal amount of
the Indebtedness to which such Interest Rate Agreement relates;
(viii) Indebtedness represented by performance bonds, warranty or
contractual service obligations, standby letters of credit or appeal bonds, in
each case to the extent incurred in the ordinary course of business of the
Issuers and their Subsidiaries;
(ix) Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with Deposit Accounts;
(x) Guarantees in the ordinary course of business of the
obligations of suppliers, landlords, customers, franchisees and licensees of the
Issuers and their Subsidiaries;
(xi) Refinancing Notes, PROVIDED, HOWEVER, that the proceeds
thereof shall be used within one Business Day of receipt to satisfy and repay
the Senior Notes in full;
(xii) Indebtedness issued in the ordinary course of business
solely to support the Issuers' or any Subsidiary's insurance or self-insurance
obligations (including, without limitation, to secure workers' compensation and
other similar insurance coverages);
(xiii) Indebtedness of Essex International Ltd. and Temple
Electrical Ltd. under or in connection with that certain Agreement for the
Purchase of Debts by and
40
between HSBC Invoice Finance (UK) Ltd. and Essex International Limited as of
August 16, 2001 in an amount not to exceed 900,000 Pounds Sterling; and
(xiv) Indebtedness not otherwise permitted to be incurred pursuant
to clauses (i) through (xiii) above, which, together with any other Indebtedness
incurred pursuant to this clause (xiv), has an aggregate principal amount which
on a consolidated basis for Holdings does not exceed $5 million at any time.
For purposes of determining compliance with, and the outstanding
principal amount of a particular Indebtedness incurred pursuant to and in
compliance with this Section 4.7, in the event such Indebtedness meets the
criteria of more than one of the types of Indebtedness described in the first
paragraph of this Section 4.7 or in clauses (i) through (xiii) of the second
paragraph of this Section 4.7, (a) Holdings and the Issuers, in their sole
discretion, shall classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness either in the first paragraph
of this Section 4.7 or one of such clauses in the second paragraph of this
Section 4.7, or any combination thereof, and (b) Holdings and the Issuers, in
their sole discretion, may reclassify such item of Indebtedness under a
different paragraph or clause of this Section 4.7 so long as such Indebtedness
met the criteria of such paragraph or clause on the date on which it was
incurred.
SECTION 4.8. LIMITATION ON RESTRICTED PAYMENTS. Holdings will not, and
will not permit any of its Subsidiaries to, directly or indirectly, make, any
Restricted Payment, unless:
(a) no Default or Event of Default shall have occurred or would occur and
be continuing at the time of and immediately after giving effect to such
Restricted Payment;
(b) immediately after giving pro forma effect to such Restricted Payment,
Holdings could incur $1.00 of additional Indebtedness under the first paragraph
of Section 4.7 hereof; and
(c) immediately after giving effect to such Restricted Payment, the
aggregate of all Restricted Payments declared or made after the Issue Date
through and including the date of such Restricted Payment (the "Base Period")
does not exceed the sum of (1) 50% of Holdings' Consolidated Net Income (or in
the event such Consolidated Net Income shall be a deficit, minus 100% of such
deficit) during the Base Period, and (2) 100% of the aggregate Net Proceeds from
the issue or sale during the Base Period of Equity Interests (other than
Disqualified Equity Interests or Equity Interests of Holdings issued to any
Subsidiary of Holdings or any Indebtedness of Holdings convertible into or
exercisable or exchangeable for Equity Interests (other than Disqualified Equity
Interests) of Holdings which has been so converted or exercised or exchanged, as
the case may be). For purposes of determining under clause (c) the amount
expended for Restricted Payments, cash distributed shall be valued at the face
amount thereof and property other than cash will be valued at its fair market
value.
The provisions of this Section 4.8 shall not prohibit:
(i) the agreement or commitment to make any payment or
distribution permitted under this Indenture or the payment or distribution so
agreed or committed to be made as long as such payment or distribution is made
on the date of such agreement or commitment or
41
within 60 days thereof; PROVIDED, HOWEVER, that on the date of such agreement or
commitment such payment would comply with the foregoing provisions, it being
understood that the agreement or commitment to make such payment or distribution
shall constitute Indebtedness permitted under the second paragraph of Section
4.7,
(ii) the retirement of any Equity Interests of either of the
Issuers or Subordinated Indebtedness of Holdings or any of its Subsidiaries or
the Plan of Reorganization Preferred Stock by conversion into or by an exchange
for Equity Interests (other than Disqualified Equity Interests), or out of the
Net Proceeds of the substantially concurrent sale (other than to a Subsidiary of
the Issuers) of other Equity Interests of Holdings (other than Disqualified
Equity Interests),
(iii) the redemption or retirement of Subordinated Indebtedness of
either of the Issuers in exchange for, by conversion into, or out of the Net
Proceeds of, a substantially concurrent sale or incurrence of Indebtedness
(other than any Indebtedness owed to a Subsidiary of either of the Issuers) that
is contractually subordinated in right of payment to the Senior Notes to at
least the same extent as the Subordinated Indebtedness being redeemed or
retired, if at all,
(iv) the retirement of any Disqualified Equity Interests by
conversion into, or by exchange for, shares of Disqualified Equity Interests, or
out of the Net Proceeds of the substantially concurrent sale (other than to a
Subsidiary of either of the Issuers) of other Disqualified Equity Interests,
(v) distributions made by Subsidiaries of Holdings to Holdings
solely for the purpose of paying foreign, federal, state or local taxes owed by
Holdings and its consolidated Subsidiaries,
(vi) distributions made by Subsidiaries of Holdings to Holdings to
pay the fees and expenses of Holdings incurred in the ordinary course of
business (including, without limitation, (x) franchise taxes and similar costs,
(y) any such Subsidiary's proportionate share of any fees and expenses payable
to directors of Holdings and (z) insurance premiums in respect of directors' and
officers' liability insurance) and other costs and expenses in connection with
Holdings being a publicly traded company (including, without limitation, fees
and expenses of professionals and regulatory compliance), or
(vii) Restricted Payments provided for in the Plan of
Reorganization to be made on or as of the Issue Date;
PROVIDED, HOWEVER, that in the case of the immediately preceding clauses (ii)
and (iii), no Default or Event of Default shall have occurred and be continuing
at the time of such Restricted Payment or would occur as a result thereof.
In determining the aggregate amount of Restricted Payments made
subsequent to the Issue Date for purposes of clause (c) above, amounts expended
pursuant to clauses (i) and (ii) of the immediately preceding paragraph shall be
included, but without duplication, in such calculation.
42
For purposes of calculating the Net Proceeds received by Holdings from
the issuance or sale of its Equity Interests either upon the conversion of, or
in exchange for, Indebtedness of Holdings or any Subsidiary, such amount will be
deemed to be an amount equal to the difference of (a) the sum of (i) the
principal amount or accreted value (whichever is less) of such Indebtedness on
the date of such conversion or exchange and (ii) the additional cash
consideration, if any, received by Holdings upon such conversion or exchange,
plus any payment on account of fractional shares, minus (b) all expenses
incurred in connection with such issuance or sale. In addition, for purposes of
calculating the Net Proceeds received by Holdings from the issuance or sale of
its Equity Interests upon the exercise of any options or warrants of Holdings,
such amount shall be deemed to be an amount equal to the difference of (a) the
additional cash consideration, if any, received by Holdings upon such exercise,
minus (b) all fees, commissions, discounts and expenses incurred by Holdings in
connection with such issuance or sale, if any.
SECTION 4.9. LIMITATIONS ON LIENS. The Issuers will not, and will not
permit any of their Subsidiaries to, create, incur or otherwise cause or suffer
to exist or become effective any Liens of any kind (other than Permitted Liens)
upon any property or asset of the Issuers or any Subsidiary or any shares of
stock or debt of any Subsidiary which owns property or assets, now owned or
hereafter acquired, or any income or profits therefrom, unless (i) if such Lien
secures Indebtedness which is pari passu with the Senior Notes, then the Senior
Notes are secured on an equal and ratable basis with the obligations so secured
until such time as such obligations are no longer secured by a Lien or (ii) if
such Lien secures Subordinated Indebtedness, any such Lien shall be subordinated
to a Lien on such property or asset or shares of stock or debt granted to the
Holders of the Senior Notes to the same extent as such Subordinated Indebtedness
is subordinated to the Senior Notes.
SECTION 4.10. LIMITATION ON CERTAIN ASSET SALES. Neither the Issuers nor
any of their Subsidiaries will consummate or permit, directly or indirectly, any
Asset Sale, unless (i) such Issuers or such Subsidiary, as the case may be,
receives consideration at the time of each such Asset Sale at least equal to the
fair market value of the Property subject to such Asset Sale, (ii) in the case
of all Asset Sales, at least 75% of the consideration received by such Issuer or
such Subsidiary is in the form of cash or Temporary Cash Investments, and (iii)
no Default or Event of Default shall have occurred and be continuing on the date
of such proposed Asset Sale or would result as a consequence of such Asset Sale;
provided that (a) the amount of any notes or other obligations received by such
Issuer or such Subsidiary from such transferee that are converted by such Issuer
or such Subsidiary into cash (to the extent of the cash received) within 90 days
following the closing of such Asset Sale and (b) any Designated Noncash
Consideration received by such Issuer or any of its Subsidiaries in such Asset
Sale having an aggregate fair market value, taken together with all other
Designated Noncash Consideration received pursuant to this clause (b) that is at
that time outstanding, less the amount of cash or Temporary Cash Investments
received by Issuers or any of their Subsidiaries in connection with a subsequent
sale of any such Designated Noncash Consideration, not exceeding $5 million at
the time of the receipt of such Designated Noncash Consideration (measured at
the time received and without giving effect to subsequent changes in value)
shall be deemed to be cash for purposes of clause (ii) of this provision.
With respect to any Asset Sale Proceeds related to Collateral in the form
of cash or Temporary Cash Investments (including cash collected on any notes),
and any Insurance
43
Proceeds or Condemnation Proceeds on account of any separate loss of any
Collateral of the Issuers or their Subsidiaries in excess of $5 million which
are not applied to the repair, rebuilding, restoration or replacement of the
Collateral affected by the subject Loss Event (in any such case, the "Collateral
Proceeds Amount"), the Issuers shall (i) to the extent the Issuers elect, apply
the Collateral Proceeds Amount to acquire Property (provided that, in the case
of an Asset Sale of Property constituting Collateral under the Collateral Trust
Agreement, the Issuers shall cause such Property to become Collateral under the
Collateral Trust Agreement as and when received by the Issuers or by any of its
Subsidiaries), that is useful in any business in which the Issuers are permitted
to be engaged within 365 days from the later of the date of such Asset Sale or
the receipt of such Collateral Proceeds Amount (or become contractually bound to
do so); or (ii) make an offer (a "Collateral Proceeds Offer") for up to a
maximum principal amount (expressed as an integral multiple of $1,000) of Senior
Notes equal to the Collateral Proceeds Amount to the extent the balance of such
Collateral Proceeds Amount after application in accordance with clause (i) is in
excess of $1 million at a purchase price equal to 100% of the principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date of
purchase in accordance with the procedures set forth in this Indenture. To the
extent that the aggregate principal amount of Senior Notes tendered pursuant to
such Collateral Proceeds Offer is less than the Collateral Proceeds Amount, the
Issuers may use such portion of the Collateral Proceeds Amount that is not used
to purchase Senior Notes tendered for general corporate purposes not
inconsistent with the Senior Notes or this Indenture. If the aggregate principal
amount of the Senior Notes tendered pursuant to such Collateral Proceeds Offer
is more than the Collateral Proceeds Amount, the Senior Notes tendered will be
repurchased on a pro rata basis or by such other method as the Trustee shall
deem fair and appropriate. Upon the completion of any Collateral Proceeds Offer
and the closing of any repurchase of Senior Notes tendered pursuant to such
Collateral Proceeds Offer, the Collateral Proceeds Amount shall be deemed to be
zero.
Pending their use as hereinabove prescribed, all Asset Sale Proceeds from
Asset Sales of Property constituting Collateral, Insurance Proceeds and
Condemnation Proceeds from Loss Events and non-cash consideration from Asset
Sales of Property constituting Collateral, including all Collateral Proceeds
Amounts, shall be applied as provided for under the Collateral Documents.
If the Issuers are required to make a Collateral Proceeds Offer, the
Issuers shall mail, within 30 days following the date on which the Issuers
receive any Collateral Proceeds Amounts, notice to the holders of the Senior
Notes stating, among other things: (1) that such holders have the right to
require the Issuers to apply the Collateral Proceeds Amount to repurchase such
Senior Notes at a purchase price in cash equal to 100% of the principal amount
thereof plus accrued and unpaid interest, if any, to the date of purchase; (2)
the purchase date, which shall be no earlier than 30 days and not later than 60
days from the date such notice is mailed; (3) the instructions, determined by
the Issuers, that each holder of Senior Notes must follow in order to have such
Senior Notes repurchased; and (4) the calculations used in determining the
Collateral Proceeds Amount to be applied to the repurchase of such Senior Notes.
The Issuers will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
prepayment, repayment, redemption or the repurchase of Senior Notes with the
Asset Sale Proceeds as required herein.
44
To the extent that the provisions of any securities laws or regulations
conflict with provisions of this covenant, the Issuers will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under this covenant by virtue thereof.
SECTION 4.11. LIMITATION ON TRANSACTIONS WITH AFFILIATES. The Issuers
will not, and will not permit any of their Subsidiaries to, directly or
indirectly, enter into or suffer to exist any transaction or series of related
transactions (including, without limitation, the sale, purchase, exchange or
lease of assets, property or services) with any Affiliate of the Issuers
(including any Affiliate in which the Issuers or any Subsidiary thereof owns a
minority interest) (each such transaction, an "Affiliate Transaction") or
extend, renew, waive or otherwise modify the terms of any Affiliate Transaction
entered into prior to the Issue Date unless (i) such Affiliate Transaction is
solely between or among Holdings and its Wholly-Owned Subsidiaries; (ii) such
Affiliate Transaction is solely between or among Wholly-Owned Subsidiaries of
Holdings; or (iii) the terms of such Affiliate Transaction are fair and
reasonable, as determined by the Board of Directors of Holdings, to Holdings or
such Subsidiary, as the case may be, and the terms of such Affiliate Transaction
are at least as favorable, as determined by the Board of Directors of the Issuer
that is the direct parent of such Wholly-Owned Subsidiary, as the terms which
could be obtained by the Issuer or such Subsidiary, as the case may be, in a
comparable transaction made on an arm's-length basis between unaffiliated
parties. In any Affiliate Transaction involving an amount or having a value in
excess of $5 million in any one year which is not permitted under clause (i) or
(ii) above, the Issuer or such Subsidiary, as the case may be, must obtain a
resolution of an independent committee of its Board of Directors certifying that
such Affiliate Transaction complies with clause (iii) above, as the case may be.
The foregoing provisions will not apply to (i) the payment of reasonable
annual compensation to directors or officers of the Issuers (including the
issuance of stock options and/or stock awards) and (ii) the continued
performance of transactions with Affiliates disclosed in the Plan of
Reorganization, on no less favorable terms as disclosed in the Plan of
Reorganization.
SECTION 4.12. LIMITATIONS ON INVESTMENTS. Holdings will not, and will not
permit any of its Subsidiaries to, make any Investment other than (i) a
Permitted Investment or (ii) an Investment that is made as a Restricted Payment
in compliance with Section 4.8 hereof.
SECTION 4.13. FUTURE SUBSIDIARY GUARANTORS. The Issuers shall cause each
Domestic Subsidiary, created or acquired, directly or indirectly, by either of
the Issuers after the date hereof to execute a Supplemental Indenture in the
form included as part of Exhibit C to this Indenture providing for a Guarantee
of the Issuers' obligations hereunder and reasonably satisfactory in form and
substance to the Trustee (and with documentation relating thereto as the Trustee
shall require, including, without limitation, a supplement or amendment to this
Indenture and an Opinion of Counsel as to the enforceability of such
Subsidiary's Guarantee); PROVIDED that such Subsidiary shall not be required to
execute such a Supplemental Indenture if such Subsidiary is an Unrestricted
Subsidiary, is prohibited by law from making such a Guarantee, such Subsidiary
would have been released from its guarantee by virtue of events set forth in
Section 11.4 hereof or such Subsidiary is a Subsidiary of a Person which has
been released as a guarantor pursuant to Section 11.4 hereof. Any Subsidiary
that becomes obligated to execute a
45
Supplemental Indenture pursuant to this Section 4.13, shall also become a party
to the Collateral Agreement and any other documents required to grant to the
Collateral Agent, for the benefit of Holders, a Lien on any real, personal or
mixed property of such Subsidiary as security for the Senior Note Obligations.
SECTION 4.14. DESIGNATION OF SUBSIDIARIES AND UNRESTRICTED SUBSIDIARIES.
(a) The Issuers may by written notice to the Trustee designate any Subsidiary
(including a newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary; provided, however, that (i) no Default or Event of Default shall
have occurred and be continuing or would arise therefrom, (ii) such designation
is at that time permitted under Section 4.8 hereof and (iii) immediately after
giving effect to such designation, Holdings could incur $1.00 of additional
Indebtedness pursuant to the first paragraph of Section 4.7. In the event the
Issuers designate a Subsidiary to be an Unrestricted Subsidiary, the following
provisions shall apply:
(i) an "Investment" shall be deemed to have been made at the time
any Subsidiary is designated as an Unrestricted Subsidiary in an amount
(proportionate to Holdings' percentage Equity Interest in such Subsidiary) equal
to the net worth of such Subsidiary at the time that such Subsidiary is
designated as an Unrestricted Subsidiary;
(ii) at any date the aggregate of all Restricted Payments made as
Investments since the Issue Date shall exclude and be reduced by an amount
(proportionate to Holdings' percentage Equity Interest in such Subsidiary) equal
to the net worth of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Subsidiary, not to exceed, in the case
of any such redesignation of an Unrestricted Subsidiary as a Subsidiary, the
amount of Investments previously made by the Holdings and its Subsidiaries in
such Unrestricted Subsidiary; and
(iii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer.
For purposes of clauses (i) and (ii) above, "net worth" shall be
calculated based upon the fair market value of the assets of such Subsidiary as
of any such date of designation.
(b) Notwithstanding clause (a) above, neither Issuer's Board of Directors
may designate any Subsidiary to be an Unrestricted Subsidiary after the Issue
Date if, after such designation:
(i) the Issuers or any of their Subsidiaries provides credit
support for, or a guarantee of, any Indebtedness or other obligation (contingent
or otherwise) of such Subsidiary (including any understanding, agreement or
instrument evidencing such Indebtedness or obligation) or is otherwise subject
to recourse or obligated thereunder or therefor, unless such credit support or
guarantee is permitted by the terms of this Indenture;
(ii) a default with respect to any Indebtedness of such Subsidiary
(including any right which the holders thereof may have to take enforcement
action against such Subsidiary) would permit (upon notice, lapse of time or
both) any holder of any other Indebtedness of the Issuers or any Subsidiary of
the Issuers to declare a default on such other
46
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity;
(iii) such Subsidiary owns any Equity Interests in, or owns or
holds any Lien on any property of, any Subsidiary which is not a Subsidiary of
the Subsidiary to be so designated;
(iv) such Subsidiary has any contract, arrangement, agreement or
understanding with the Issuers, or any Subsidiary of the Issuers, whether
written or oral, other than a transaction having terms no less favorable to the
Issuers or such Subsidiary of the Issuers than those which might be obtained at
the time from Persons who are not Affiliates of the Issuers; or
(v) the Issuers or any Subsidiary of the Issuers has any
obligation to subscribe for any Equity Interest in such Subsidiary or to
maintain or preserve such Subsidiary's financial condition or to cause such
Subsidiary to achieve specified levels of operating results, unless such
obligation is permitted by the terms of this Indenture.
SECTION 4.15. LIMITATION ON DIVIDENDS AND OTHER PAYMENT RESTRICTIONS
AFFECTING SUBSIDIARIES. The Issuers will not, and will not permit any of their
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any of their Subsidiaries to (a) pay dividends or make any
other distributions in cash or otherwise on their Equity Interests to the
Issuers or any of their Subsidiaries, (b) pay any Indebtedness owed to the
Issuers or any Subsidiaries, (c) make loans or advances to the Issuers or any
Subsidiary thereof, (d) transfer any of its properties or assets to the Issuers
or any Subsidiary thereof (other than customary restrictions on transfer of
property subject to a Permitted Lien under the term of the agreements creating
such Permitted Lien (other than a Lien on cash not constituting proceeds of
non-cash property subject to a Permitted Lien) which would not materially
adversely affect the Issuers' or any Subsidiary's ability to satisfy its
obligations under the Senior Notes), or (e) guarantee any Indebtedness of either
of the Issuers or any Subsidiary of either of the Issuers, except, in each case,
for such encumbrances or restrictions existing under or contemplated by reason
of (i) the Senior Notes or this Indenture, (ii) any restrictions existing under
or contemplated by agreements evidencing any Senior Indebtedness, (iii) any
restrictions which are in existence on the Issue Date (including pursuant to the
Brownwood Lease) or which exist with respect to a Person that becomes a
Subsidiary on or after the Issue Date, which are in existence at the time such
Person becomes a Subsidiary of either of the Issuers (but not created in
connection with or contemplation of such Person becoming a Subsidiary of either
of the Issuers and which encumbrance or restriction is not applicable to any
Person or the property or assets of any Person other than such Person or the
property or assets of such Person (or their Subsidiaries) so acquired) and any
agreement that refinances or replaces the same; provided, however, that the
terms and conditions of any such restrictions are not materially less favorable
in the aggregate to the holders of the Senior Notes than those under or pursuant
to the agreement being replaced or the agreement evidencing the Indebtedness
refinanced or replaced, (iv) customary non-assignment provisions in any contract
or licensing agreement entered into by either of the Issuers or any Subsidiary
of either of the Issuers in the ordinary course of business or in any lease
governing any leasehold interest of the Issuers or a Subsidiary, (v) any
restrictions existing under
47
or contemplated by agreements evidencing any Purchase Money Indebtedness or
Capitalized Lease Obligations that impose restrictions on the ability of any of
the Issuers or their Subsidiaries to transfer the property so acquired or leased
to either of the Issuers or their Subsidiaries and (vi) any restrictions
existing under or contemplated by agreements evidencing any Refinancing
Indebtedness, providing that the restrictions contained in the agreements
governing such Refinancing Indebtedness are no more restrictive in whole than
those contained in the agreements governing the Indebtedness being refinanced.
SECTION 4.16. RESTRICTION ON SALE AND ISSUANCE OF CERTAIN SUBSIDIARY
EQUITY INTERESTS. The Issuers and their Subsidiaries will not issue or sell any
Equity Interests of any Subsidiary to any person other than the Issuers or a
Wholly-Owned Subsidiary of either of the Issuers (except for common Equity
Interests with no preferences or special rights or privileges and with no
redemption or prepayment provisions, provided that such common Equity Interests
are sold in compliance with Section 4.10 and immediately after giving effect to
such issuance or sale, such Subsidiary either continues to be a Subsidiary or if
such Subsidiary would no longer be considered a Subsidiary, then the investment
of the Issuer in such Person (after giving effect to such issuance or sale)
would have been permitted to be made under Section 4.10 as if made on the date
of such issuance or sale and except to qualify directors to the extent required
by applicable law).
SECTION 4.17. LIMITATION ON SALE AND LEASE-BACK TRANSACTIONS. The Issuers
will not, and will not permit any of their Subsidiaries to, enter into any Sale
and Lease-Back Transaction unless (i) the consideration received in such Sale
and Lease-Back Transaction is at least equal to the fair market value of the
property sold and (ii) immediately prior to and after giving effect to the
Attributable Indebtedness in respect of such Sale and Lease-Back Transaction,
Holdings could incur at least $1.00 of additional Indebtedness pursuant to the
first paragraph of Section 4.7.
SECTION 4.18. CONDUCT OF BUSINESS. Neither the Issuers nor their
Subsidiaries shall engage in any businesses a majority of whose revenues are not
derived from the same or reasonably similar, ancillary or related to, or a
reasonable extension, development or expansion of, the businesses in which the
Issuers and their Subsidiaries are engaged on the Effective Date.
SECTION 4.19. LIMITATION ON STATUS AS INVESTMENT COMPANY. Neither the
Issuers nor any of their Subsidiaries will take any action or suffer to exist
any condition that would require the Issuers or any of their Subsidiaries to
register as an "investment company" (as that term is defined in the Investment
Company Act of 1940, as amended), or otherwise become subject to regulation as
an investment company.
SECTION 4.20. CORPORATE EXISTENCE. Subject to Article 5 hereof, the
Company shall do or cause to be done all things necessary to preserve and keep
in full force and effect its limited liability company existence and the
Co-Issuer shall do or cause to be done all things necessary to preserve and keep
in full force and effect is corporate existence, and the Issuers shall do or
cause to be done all things necessary to preserve and keep in full force and
effect the corporate, partnership, limited liability company or other existence
of each of their respective Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of each
such Subsidiary and the rights (charter and statutory), licenses and
48
franchises of the Issuers and their respective Subsidiaries; provided, however,
that an Issuer shall not be required to preserve any such right, license or
franchise, or the corporate, partnership, limited liability company or other
existence of any of their Subsidiaries, if such Issuer's Board of Directors
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of such Issuer and its Subsidiaries, taken as a whole.
SECTION 4.21. MAINTENANCE OF OFFICE OR AGENCY. Each of the Issuers shall
maintain in the Borough of Manhattan, the City of New York, an office or agency
where Senior Notes may be surrendered for registration of transfer or exchange
or for presentation for payment and where notices and demands to or upon the
Issuers in respect of the Senior Notes and this Indenture may be served. The
Issuers shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Issuers
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 address of the Trustee as set
forth in Section 12.2.
The Issuers may also from time to time designate one or more other
offices or agencies where the Senior Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations.
The Issuers shall give prompt written notice to the Trustee of such designation
or rescission and of any change in the location of any such other office or
agency; PROVIDED, HOWEVER, that no such designation or rescission shall relieve
the Issuers of their obligation to maintain an office or agency in the Borough
of Manhattan, the City of New York, for such purposes.
The Issuers initially appoint the Trustee as Registrar, Paying Agent and
Agent for service of notices and demands in connection with the Senior Notes and
this Indenture.
SECTION 4.22. MAINTENANCE OF INSURANCE; BOOKS AND RECORDS; COMPLIANCE
WITH LAWS. (a) Each of the Issuers and each of their respective Subsidiaries
shall provide or cause to be provided, for itself and each of their respective
Subsidiaries, insurance (including appropriate self-insurance) that is adequate
and appropriate for the conduct of the business of the Issuers and such
Subsidiaries in a prudent manner, with reputable insurers, or, in the case of
any foreign Subsidiary, with the government of any member of the European Union
or with the government of the United States of America or an agency or
instrumentality thereof, in such amounts, with such deductibles, and by such
methods as shall be customary for and available to businesses similarly situated
in the industry.
(b) Each of the Issuers shall and shall cause each of their Subsidiaries
to keep proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the assets and business of the
Issuers and each of their respective Subsidiaries, in accordance with GAAP
consistently applied to the Issuers and each of their respective Subsidiaries
taken as a whole.
(c) Each of the Issuers shall and shall cause each of their Subsidiaries
to comply with all statutes, laws, ordinances, or government rules and
regulations to which they are subject, noncompliance with which would materially
adversely affect the business, prospects, earnings,
49
properties, assets or condition (financial or otherwise) of the Issuers and
their Subsidiaries taken as a whole.
SECTION 4.23. FURTHER ASSURANCES TO THE TRUSTEE. Each of the Issuers
shall (and shall cause each of their respective Subsidiaries to) execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments as may be reasonably
required from time to time in order (i) to carry out more effectively the
purposes of the Collateral Documents, (ii) to subject to the Liens created by
any of the Collateral Documents any of the properties, rights or interest
required to be encumbered thereby, (iii) to perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby, and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Trustee any of the rights
granted or now or hereafter intended by the parties thereto to be granted to the
Trustee or under any other instrument executed in connection therewith or
granted to the Issuers under the Collateral Documents or under any other
instrument executed in connection therewith.
SECTION 4.24. COLLATERAL DOCUMENTS. Neither the Issuers nor any of their
respective Subsidiaries will amend, waive or modify, or take or refrain from
taking any action that has the effect of amending, waiving or modifying, any
provision of the Collateral Documents or engaging in any transfer of assets from
a company whose capital stock and assets constitute Collateral or any
restructuring of the affairs of such a company and its subsidiaries to the
extent that such amendment, waiver, modification, action or restructuring could
reasonably be expected to have an adverse effect on the rights of the Trustee,
the Collateral Agent or the Holders, provided that (i) the Collateral may be
released or modified in an Asset Sale as expressly authorized in this Indenture
or in the Collateral Documents; (ii) any Guarantee and pledges may be released
in an Asset Sale as expressly provided in this Indenture or in the Collateral
Documents; (iii) this Indenture and any of the Collateral Documents may be
otherwise amended, waived or modified as set forth under Article 10 hereof; and
(iv) nothing herein shall be deemed to prohibit or restrict any action (or
omission) that the Issuers or any of their Subsidiaries is expressly permitted
to take hereunder.
SECTION 4.25. FUTURE PLEDGES OF COLLATERAL TO SECURE SECONDARY SENIOR
NOTES. The Collateral Documents shall provide that the Holders of Secondary
Senior Notes when issued, shall, automatically and without further action,
become the beneficiaries of the pledges of property and assets to the Collateral
Agent pursuant to the Collateral Documents and such Secondary Senior Notes shall
also be secured by the Collateral.
SECTION 4.26. ADDITIONAL PLEDGES. If on or after the Issue Date,
Holdings, Intermediate Holdco, the Issuers or any of their Subsidiaries pledges
property or assets to secure obligations under the Credit Agreement (other than
pursuant to the Collateral Documents or as contemplated by the Credit Agreement
in effect on the date hereof), then such property or assets shall also secure
the Senior Notes. In the event that no Credit Facility is outstanding and in
effect, promptly (and in any event within twenty (20) Business Days) after the
creation or acquisition by Holdings of a new Subsidiary that becomes a Guarantor
pursuant to Section 4.13, such Issuer shall cause such Subsidiary to become a
party to the Collateral Documents or executive documents
50
substantially similar to the Collateral Documents, and the Issuer or Guarantor
that is such new Guarantor's direct parent company shall execute such agreement
or other document reasonably satisfactory to the Trustee and pursuant to which
all the Equity Interests of such new Guarantor shall be pledged to the Trustee
(for the benefit of the Holders) to secure the Senior Note Obligations and such
other related documents as the Trustee may request, all in form and substance
reasonably satisfactory to the Trustee.
ARTICLE 5
Successor Corporation
---------------------
SECTION 5.1. MERGER, CONSOLIDATION OR SALE OF ASSETS. (a) Neither Issuer
will consolidate with, merge with or into, or sell, assign, lease, convey,
transfer or otherwise dispose of (a "transfer") all or substantially all of its
assets (as an entirety or substantially as an entirety in one transaction or a
series of related transactions), to any Person unless: (i) such Issuer shall be
the continuing Person, or the Person (if other than such Issuer) formed by such
consolidation or into which such Issuer is merged or to which the properties and
assets of such Issuer are transferred shall be a corporation or limited
liability company organized and existing under the laws of the United States or
any State thereof or the District of Columbia and shall expressly assume, by a
supplemental indenture, executed and delivered to the Trustee, in form
reasonably satisfactory to the Trustee, all of the obligations of such Issuer
under the Senior Notes, this Indenture and the Collateral Documents, and the
obligations under this Indenture shall remain in full force and effect; (ii)
immediately before and immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; (iii)
immediately after giving effect to such transaction on a pro forma basis
Holdings or such Person could incur at least $1.00 additional Indebtedness
pursuant to the first paragraph of Section 4.7 hereof; and (iv) immediately
thereafter, the Issuer or the other surviving entity, as the case may be, shall
have a Consolidated Net Worth equal to or greater than the Consolidated Net
Worth of the Issuer immediately prior to such transaction.
(b) In connection with any consolidation, merger or transfer of assets
contemplated by this Section 5.1, the Issuer undergoing such transfer shall
deliver or cause to be delivered, to the Trustee, in form and substance
reasonably satisfactory to the Trustee, an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger or transfer and the
supplemental indenture in respect thereto comply with this Section 5.1 and that
all conditions precedent herein provided for relating to such transaction or
transactions have been complied with.
(c) This Section 5.1 shall not apply to the sale of the stock or assets
of the Issuers or any Subsidiary of either of the Issuers in accordance with
Section 4.10 hereof.
(d) This Section 5.1 shall not apply to the conversion of the Company
into a Delaware limited liability company pursuant to Section 265 of the
Delaware Limited Liability Company Act; provided that (i) the Issuers shall have
given the Trustee not less than 30 days prior notice of such conversion and (ii)
if the Trustee so requires, the Company shall expressly reconfirm by a
Supplemental Indenture, executed and delivered to the Trustee, in form
reasonably satisfactory to the Trustee, all of it obligations hereunder and
under the Senior Notes.
SECTION 5.2. Successor Person Substituted. Upon any consolidation or
merger, or any transfer of all or substantially all of the assets of either of
the Issuers or any of their respective Subsidiaries in accordance with Section
5.1 above, the successor entity formed by such consolidation or into which
either of the Issuers or any of their respective Subsidiaries is merged or to
which such transfer is made shall succeed to, and be substituted for, and may
exercise every right and power of, either of the Issuers or such Subsidiary
under this Indenture with the same effect as if such successor entity had been
named as such Issuer or such Subsidiary herein, and thereafter the predecessor
entity shall be relieved of all obligations and covenants under this Indenture
and the Senior Notes, except, in the case of a transfer, for the obligation to
pay the principal of, and interest on, the Senior Notes.
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ARTICLE 6
Defaults and Remedies
---------------------
SECTION 6.1. EVENTS OF DEFAULT. An "Event of Default" occurs if:
(1) there is a default in the payment of any principal of, or
premium, if any, on the Senior Notes when the same becomes due and payable on
the Maturity Date, upon optional redemption, upon required repurchase, upon
declaration or otherwise;
(2) there is a default for 30 days in the payment of any interest
on the Senior Notes after such interest becomes due and payable;
(3) either Issuer or any Guarantor fails to comply with any of the
terms or provisions of Section 5.1 hereof;
(4) either Issuer or any Guarantor defaults in the observance or
performance of any other provision, covenant or agreement contained in the
Senior Notes, this Indenture or the Collateral Documents for 30 days after
written notice from the Trustee or the holders of not less than 25% in aggregate
principal amount of the Senior Notes then outstanding;
(5) there is a failure to pay when due (and beyond the grace
period, if any, therefor) principal, interest or premium in an aggregate amount
of $2.5 million or more with respect to any Indebtedness of Holdings, Primary
Intermediate Holdco, Secondary Intermediate Holdco, either Issuer or any
Subsidiary thereof, or the acceleration prior to its express maturity of any
such Indebtedness aggregating $2.5 million or more and such acceleration does
not cease to exist, or such debt is not satisfied, in either case within 30 days
after such acceleration;
(6) a court of competent jurisdiction renders a final judgment or
judgments which can no longer be appealed for the payment of money, in any
individual case or in the aggregate at any time, in excess of $2.5 million
(which are not paid or covered by third party insurance or bond by financially
sound insurers) against Holdings, Primary Intermediate Holdco, Secondary
Intermediate Holdco, either Issuer or any Subsidiary thereof and such judgment
remains undischarged for a period of 60 consecutive days during which a stay of
enforcement of such judgment shall not be in effect;
52
(7) Holdings, Primary Intermediate Holdco, Secondary Intermediate
Holdco, either Issuer or any Subsidiary thereof pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(D) makes a general assignment for the benefit of
its creditors or shall admit in writing its inability to
pay its debt, or
(E) generally is not paying its debts as they become
due;
(8) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against Holdings, Primary
Intermediate Holdco, Secondary Intermediate Holdco, either
Issuer or any Subsidiary thereof in an involuntary case or
proceeding,
(B) appoints a Custodian of either Issuer or any
Subsidiary thereof or for all or substantially all of the
property of Holdings, Intermediate Holdco, either Holdings,
Intermediate Holdco, or any Subsidiary thereof, or
(C) orders the liquidation of Holdings, Primary
Intermediate Holdco, Secondary Intermediate Holdco, either
Issuer or any Subsidiary thereof,
(D) and, in each case, the order or decree remains
unstayed and in effect for 60 consecutive days;
(9) at any time after the execution and delivery thereof, (i) any
Guarantee for any reason, other than the satisfaction in full of all Obligations
guaranteed thereunder or the release of such Guarantee pursuant to Section 11.4,
shall cease to be in full force and effect (other than in accordance with its
terms) or shall be declared to be null and void, or (ii) a material Collateral
Document shall cease to be in full force and effect (other than by reason of a
release of Collateral thereunder in accordance with the terms hereof or thereof,
the satisfaction in full of the Obligations or any other termination of such
Collateral Document in accordance with the terms hereof or thereof) or shall be
declared null and void, or the Trustee or the Collateral Agent shall not have or
shall cease to have a valid and perfected second priority Lien for any period in
excess of 30 days on any Collateral purported to be covered thereby having a
fair market value, individually or in the aggregate, exceeding $2.5 million, in
each case for any reason other than the failure of the Trustee or the Collateral
Agent to take any action within its control; or
53
(10) holders of Senior Indebtedness holding a Lien on the stock or
assets of either Issuer or any Subsidiary take any judicial action to enforce
such Lien.
Subject to the provisions of Sections 7.1 and 7.2, the Trustee shall not
be charged with knowledge of any Default or Event of Default unless written
notice thereof shall have been given to a Responsible Officer at the Corporate
Trust Office by the Issuers or any other Person.
SECTION 6.2. ACCELERATION. If an Event of Default (other than an Event of
Default arising under Section 6.1(7) or (8)) occurs and is continuing, the
Trustee by notice to the Issuers, or the Holders of not less than 25% in
aggregate principal amount of the Senior Notes then outstanding by written
notice to the Issuers and the Trustee, may declare to be immediately due and
payable the entire principal amount of all the Senior Notes then outstanding
plus premium, if any, and accrued interest to the date of acceleration;
provided, however, that after such acceleration but before a judgment or decree
based on such acceleration is obtained by the Trustee, the Holders of 51% in
aggregate principal amount of the outstanding Senior Notes may rescind and annul
such acceleration if all existing Events of Default, other than nonpayment of
accelerated principal, premium, if any, or interest, have been cured or waived
as provided in this Indenture and if the rescission would not conflict with any
then binding judgment or decree. No such rescission shall affect any subsequent
Default or impair any right consequent thereto.
In case an Event of Default specified in Section 6.1(7) or (8) occurs,
the principal, premium, if any, and interest amount with respect to all of the
Senior Notes shall IPSO FACTO become and be immediately due and payable without
any declaration or other act on the part of the Trustee or the Holders of the
Senior Notes.
SECTION 6.3. OTHER REMEDIES. Subject to the Collateral Documents, if an
Event of Default occurs and is continuing, the Trustee may pursue any available
remedy by proceeding at law or in equity to collect the payment of principal of,
or premium, if any, and interest on the Senior Notes or to enforce the
performance of any provision of the Senior Notes or this Indenture and may take
any necessary action requested of it as Trustee to settle, compromise, adjust or
otherwise conclude any proceedings to which it is a party.
The Trustee may maintain a proceeding even if it does not possess any of
the Senior Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Noteholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.4. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT. Subject to
Sections 6.2, 6.7 and 8.2 hereof, the Holders of a majority in principal amount
of the Senior Notes then outstanding have the right to waive any existing or
future Default or Event of Default or compliance with any provision of this
Indenture or the Senior Notes. 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 Event of Default or impair any right
consequent thereto except as specifically set forth therein.
54
SECTION 6.5. CONTROL BY MAJORITY. The Holders of a majority in principal
amount of the Senior Notes then outstanding may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee by this Indenture. The
Trustee, however, may refuse to follow any direction that conflicts with law,
this Indenture or the Collateral Documents or that the Trustee determines may be
unduly prejudicial to the rights of another Noteholder not taking part in such
direction, and the Trustee shall have the right to decline to follow any such
direction if the Trustee, being advised by counsel, determines that the action
so directed may not lawfully be taken or if the Trustee in good faith shall
determine that the proceedings so directed may involve it in personal liability
unless the Trustee has asked for and received indemnification reasonably
satisfactory to it against any loss, liability or expense caused by its
following such direction; provided that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such direction.
SECTION 6.6. LIMITATION ON SUITS. Subject to Section 6.7 below, a
Noteholder may not institute any proceeding or pursue any remedy with respect to
this Indenture or the Senior Notes unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in aggregate principal
amount of the Senior Notes then outstanding make a written request
to the Trustee to pursue the remedy;
(3) such Holder or Holders offer, and if requested, provide
to the Trustee indemnity reasonably satisfactory to the Trustee
against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested,
the provision of indemnity; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60 day period by the Holders
of a majority in aggregate principal amount of the Senior Notes
then outstanding.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
SECTION 6.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding any
other provision of this Indenture, the right of any Holder of a Senior Note to
receive payment of principal of, or premium, if any, and interest on the Senior
Note on or after the respective due dates expressed in the Senior Note, or to
bring suit for the enforcement of any such payment on or after such respective
dates, is absolute and unconditional and shall not be impaired or affected
without the consent of the Holder.
SECTION 6.8. COLLECTION SUIT BY TRUSTEE. If an Event of Default in
payment of principal, premium or interest specified in Section 6.1(1) or (2)
hereof occurs and is continuing, the Trustee may recover judgment in its own
name and as trustee of an express trust against the Issuers or the Guarantors
(or any other obligor on the Senior Notes) for the whole amount of
55
unpaid principal and accrued interest remaining unpaid, together with interest
on overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate then
borne by the Senior Notes (after giving effect to Section 4.1), and such further
amounts as shall be sufficient to cover the costs and expenses of collection,
including the compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, including all sums due and owing to the Trustee pursuant
to the Indenture including Section 7.7.
SECTION 6.9. 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 (including any claim for the
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Noteholders allowed in any judicial proceedings relative to
the Issuers or the Guarantors (or any other obligor upon the Senior Notes),
their respective creditors or property and shall be entitled and empowered to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same after deduction of its reasonable charges
and expenses to the extent that any such charges and expenses are not paid out
of the estate in any such proceedings and any custodian in any such judicial
proceeding is hereby authorized by each Noteholder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Noteholders, to pay to the Trustee any amount due to it
for the compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under the Indenture,
including without limitation Section 7.7 hereof. Nothing herein contained shall
be deemed to authorize the Trustee to authorize or consent to or accept or adopt
on behalf of any Noteholder any plan or reorganization, arrangement, adjustment
or composition affecting the Senior Notes or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any Noteholder in
any such proceedings.
SECTION 6.10. PRIORITIES. Subject to the Collateral Documents, if the
Trustee collects any money pursuant to this Article 6, it shall pay out the
money in the following order:
FIRST: to the Trustee, its agents and counsel for amounts due under the
Indenture, including without limitation, Section 7.7 hereof;
SECOND: to Noteholders for amounts due and unpaid on the Senior Notes for
principal, premium, if any, and interest as to each, ratably, without preference
or priority of any kind, according to the amounts due and payable on the Senior
Notes; and
THIRD: to the Issuers or, to the extent the Trustee collects any amount
directly from any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section 6.10. The Trustee shall give the Issuers
prior notice of any such record date and payment date; PROVIDED, HOWEVER, that
the failure to give any such notice shall not affect the establishment of such
record date or payment date or any payment to Noteholders pursuant to this
Section 6.10.
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SECTION 6.11. UNDERTAKING FOR COSTS. In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as 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 and expenses, 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 6.11 does not apply
to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7 hereof or a
suit by Holders of more than 10% in principal amount of the Senior Notes then
outstanding.
SECTION 6.12. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every case, subject to any determination in such proceeding, the Issuers, any
Guarantor, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 6.13. DELAY OR OMISSION NOT WAIVER. No delay or omission of the
Trustee or of any Holder to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article Six or by law to the Trustee or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or by
the Holders, as the case may be.
ARTICLE 7
Trustee
-------
SECTION 7.1. DUTIES OF TRUSTEE. (a) If an Event of Default has occurred
and is continuing, the Trustee shall exercise such of the rights and powers
vested in it by this Indenture and any supplemental indenture (including
providing for Guarantees of the Senior Notes and any supplemental indenture
required pursuant to Section 4.24 hereof) and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the same
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture (including any supplemental indenture)
and the Collateral Documents and those actions that are reasonably necessary for
the performance of the specified duties and no others and no implied covenants
or obligations shall be read into this Indenture or the Collateral Documents
against the Trustee.
(2) 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
57
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture but, in the case of any such certificates or
opinions which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this Indenture and
the Collateral Documents (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 7.1.
(2) In the absence of bad faith on its part, the Trustee shall not
be liable for any error of judgment made in good faith by a Responsible Officer,
unless it is proved that the Trustee was negligent in ascertaining the pertinent
facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by
it pursuant to Sections 6.2 and 6.5 hereof.
(d) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its rights or powers if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity satisfactory to it against
such risk or liability is not reasonably assured to it.
(e) Whether or not therein expressly so provided, paragraphs (a), (b),
(c), (d), (f) and (g) of this Section 7.1 shall govern every provision of this
Indenture that in any way relates to the Trustee or any Agent.
(f) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity satisfactory to it against any loss,
liability, expense or fee.
(g) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Issuers or any Guarantor.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by the law.
SECTION 7.2. Rights of Trustee. Subject to Section 7.1 hereof:
(1) The Trustee may conclusively rely on and shall be protected in
acting or refraining from acting upon any document reasonably believed by it to
be genuine and to have been signed or presented by the proper person (whether in
original or facsimile form). The Trustee need not investigate any fact or matter
stated in the document;
(2) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed by it with
due care;
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(3) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it reasonably believes to be authorized or
within its rights or powers; provided that the Trustee's conduct does not
constitute negligence or bad faith;
(4) The Trustee may consult with counsel of its selection, and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any action
taken, omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel;
(5) Before the Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel, or both;
(6) The Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Indenture;
(7) The Trustee shall not be deemed to have notice of any Default
or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
Default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Senior Notes and this Indenture;
(8) The rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its rights to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each agent, custodian and other Person employed
to act hereunder;
(9) The Trustee may request that each Issuer deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded;
(10) 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 security or indemnity reasonably satisfactory to the
Trustee against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction; and
(11) In no event shall the Trustee be responsible or liable for
special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action.
SECTION 7.3. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its individual
or any other capacity may become the owner or pledgee of Senior Notes and may
make loans to, accept deposits from, perform services for or otherwise deal with
the Issuers or any Guarantor, or any Affiliates thereof, with the same rights it
would have if it were not Trustee. Any Agent may do
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the same with like rights. The Trustee, however, shall be subject to Sections
7.10 and 7.11 hereof.
SECTION 7.4. TRUSTEE'S DISCLAIMER. The Trustee makes no representation as
to the validity or adequacy of this Indenture, the Collateral Documents, the
Senior Notes or any Guarantee, and it shall not be responsible for any statement
in the Senior Notes or any document used in connection with the sale of the
Senior Notes other than its certificate of authentication.
SECTION 7.5. NOTICE OF DEFAULTS. If a Default or Event of Default occurs
and is continuing and if it is known to the Trustee, the Trustee shall mail to
each Noteholder notice of the Default or Event of Default within 90 days after
it occurs. Except in the case of a Default or Event of Default in payment of
principal or premium, if any, or interest on the Senior Notes, or that resulted
from the failure of the Issuers to comply with Section 5.1, the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines it to be in the best interests of the holders of the
Senior Notes to do so.
SECTION 7.6. REPORTS BY TRUSTEE TO HOLDERS. If required by TIA Section
313(a), within 60 days after March 15 of any year, commencing the March 15
following the date of this Indenture, the Trustee shall mail to each Noteholder
a brief report dated as of such March 15 that complies with TIA Section 313(a);
provided that no such report need be transmitted if no such events listed in TIA
Section 313(a) have occurred within such period. The Trustee also shall comply
with TIA Section 313(b)(2). The Trustee shall also transmit by mail all reports
as required by TIA Section 313(c) and TIA Section 313(d).
A copy of each report at the time of its mailing to Noteholders shall be
filed with the SEC and each stock exchange on which the Senior Notes are listed.
The Issuers shall promptly notify the Trustee when the Senior Notes are listed
on, or delisted from, any stock exchange and the Trustee shall comply with TIA
Section 313(d).
SECTION 7.7. COMPENSATION AND INDEMNITY. The Issuers and the Guarantors
(on a joint and several basis) shall pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Issuers and the Trustee
(or in the absence of such an agreement, reasonable compensation) for its
services hereunder (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust). The Issuers
and the Guarantors (on a joint and several basis) shall reimburse the Trustee
upon request for all reasonable disbursements, expenses and advances incurred or
made by it in connection with its duties under this Indenture, including the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Issuers and the Guarantors (on a joint and several basis) shall
indemnify each of the Trustee and any predecessor Trustee for, and hold them
harmless against, any and all loss, damage, claim, liability, expense (including
but not limited to reasonable attorneys' fees and expenses) or taxes (other than
taxes based on the income of the Trustee or resulting from any gross receipts
taxes or franchise taxes of the Trustee) incurred by it solely in connection
with the acceptance or 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 powers or duties
hereunder (including, without limitation, settlement costs). The
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Trustee shall notify the Issuers and the Guarantors in writing promptly of any
claim asserted against the Trustee of which a Responsible Officer has received
written notice for which it may seek indemnity. However, the failure by the
Trustee to so notify the Issuers and the Guarantors shall not relieve the
Issuers or the Guarantors of their obligations hereunder to the extent no
material prejudice resulted from such failure to so notify.
Notwithstanding the foregoing, the Issuers and the Guarantors need not
reimburse the Trustee or any predecessor Trustee for any expense or indemnify it
against any loss or liability incurred by the Trustee through their own
negligence or willful misconduct. To secure the payment obligations of the
Issuers and the Guarantors in this Indenture, including without limitation,
Sections 7.7 and 9.5, the Trustee and any predecessor Trustee shall have a Lien
prior to the Senior Notes on all money or property held or collected by the
Trustee in its capacity as such, except such money or property held in trust to
pay principal of and interest on particular Senior Notes. The obligations of the
Issuers and the Guarantors under this Section 7.7 to compensate and indemnify
the Trustee and each predecessor Trustee and to pay or reimburse the Trustee and
each predecessor Trustee for expenses, disbursements and advances shall be joint
and several liabilities of the Issuers and each of the Guarantors and shall
survive the satisfaction and discharge of this Indenture, including the
termination or rejection hereof in any bankruptcy proceeding to the extent
permitted by law.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(7) or (8) hereof occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.8. REPLACEMENT OF TRUSTEE. The Trustee may resign by so
notifying the Issuers and the Guarantors in writing, such resignation to become
effective upon the appointment of a successor Trustee. The Holders of a majority
in principal amount of the outstanding Senior Notes may remove the Trustee by
notifying the removed Trustee in writing and may appoint a successor Trustee
with the Issuers' written consent which consent shall not be unreasonably
withheld. The Issuers may remove the Trustee at their election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) 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 Issuers shall promptly appoint a successor
Trustee.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee (at the expense of
the Issuers), the Issuers or the Holders of at least 25% in principal amount of
the outstanding Senior Notes may petition any court of competent jurisdiction at
the expense of the Issuers and Guarantors, in the case of the retiring Trustee,
for the appointment of a successor Trustee.
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If the Trustee fails to comply with Section 7.10 hereof, any Noteholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Issuers. Immediately following such delivery,
the retiring Trustee shall, subject to its rights under Section 7.7 hereof,
transfer all property held by it as Trustee to the successor Trustee, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee shall mail notice of its succession to
each Noteholder. Notwithstanding replacement of the Trustee pursuant to this
Section 7.8, the Issuers' obligations under Section 7.7 hereof shall continue
for the benefit of the retiring Trustee.
SECTION 7.9. SUCCESSOR TRUSTEE BY CONSOLIDATION, MERGER OR CONVERSION. If
the Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust assets to, another corporation or
national banking association, subject to Section 7.10 hereof, the successor
corporation or national banking association without any further act shall be the
successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION. This Indenture shall always
have a Trustee who satisfies the requirements of TIA Sections 310(a)(1) and (2)
in every respect. The Trustee shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition. The Trustee shall comply with TIA Section 310(b), including the
provision in Section 310(b)(1); provided that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities, or conflicts of interest or participation in other securities, of
the Issuers or the Guarantors are outstanding if the requirements for exclusion
set forth in TIA Section 310(b)(1) are met.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUERS. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
SECTION 7.12. PAYING AGENTS. The Issuers shall cause each Paying Agent
other than the Trustee to execute and deliver to it and the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section 7.12:
(A) that it will hold all sums held by it as agent for the payment
of principal of, or premium, if any, or interest on, the Senior Notes
(whether such sums have been paid to it by the Issuers or by any obligor
on the Senior Notes) in trust for the benefit of Holders of the Senior
Notes or the Trustee;
(B) that it will at any time during the continuance of any Event
of Default, upon written request from the Trustee, deliver to the Trustee
all sums so held in trust by it together with a full accounting thereof;
and
(C) that it will give the Trustee written notice within three (3)
Business Days of any failure of the Issuers (or by any obligor on the
Senior Notes) in the
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payment of any installment of the principal of, premium, if any, or
interest on, the Senior Notes when the same shall be due and payable.
SECTION 7.13. CO-TRUSTEE AND SEPARATE TRUSTEES. At any time or times, for
the purpose of meeting the legal requirements of any applicable jurisdiction,
the Issuers and the Trustee shall have power to appoint, and, upon the written
request of the Trustee or of the Holders of at least 33% in principal amount of
the Senior Notes then outstanding, the Issuers shall for such purpose join with
the Trustee in the execution and delivery of all instruments and agreements
necessary or proper to appoint, one or more Persons approved by the Trustee
either to act as co-trustee, jointly with the Trustee, or to act as separate
trustee, in either case with such powers as may be provided in the instrument of
appointment, and to vest in such Person or Persons, in the capacity aforesaid,
and for the benefit of the Holders, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Section. If the
Issuers do not join in such appointment within 15 days after the receipt of a
request so to do, or if an Event of Default shall have occurred and be
continuing, the Trustee alone shall have power to make such appointment.
Should any written instrument or instruments from the Issuers be required
by any co-trustee or separate trustee to more fully confirm to such co-trustee
or separate trustee such property, title, right or power, any and all such
instruments shall, on request, be executed, acknowledged and delivered by the
Issuers.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following conditions:
(a) the Senior Notes shall be authenticated and delivered, and all
rights, powers, duties and obligations hereunder in respect of the custody of
securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustee hereunder, shall be exercised solely, by
the Trustee;
(b) the rights, powers, duties and obligations hereby conferred or
imposed upon the Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed either by the
Trustee or by the Trustee and such co-trustee or separate trustee jointly, as
shall be provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in which
any particular act is to be performed, the Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties and
obligations shall be exercised and performed singly by such co-trustee or
separate trustee;
(c) the Trustee at any time, by an instrument in writing executed by it,
with the concurrence of the Issuers, may accept the resignation of or remove any
co-trustee or separate trustee appointed under this Section, and, if an Event of
Default shall have occurred and be continuing, the Trustee shall have power to
accept the resignation of, or remove, any such co-trustee or separate trustee
without the concurrence of the Issuers. Upon the written request of the Trustee,
the Issuers shall join with the Trustee in the execution and delivery of all
instruments and agreements necessary or proper to effectuate such resignation or
removal. A successor to any co-trustee or separate trustee so resigned or
removed may be appointed in the manner provided in this Section;
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(d) no co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Trustee, or any other such
trustee hereunder, and the Trustee shall not be personally liable by reason of
any act or omission of any such co-trustee or separate trustee appointed by it
with due care;
(e) any act of Holders delivered to the Trustee shall be deemed to have
been delivered to each such co-trustee and separate trustee;
(f) any separate trustee or co-trustee may at any time appoint the
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name; and
(g) if any separate trustee or co-trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties, rights, remedies
and trusts shall vest in and be exercised by the Trustee, to the extent
permitted by law, without the appointment of a new successor trustee.
ARTICLE 8
Amendments, Supplements and Waivers
-----------------------------------
SECTION 8.1. WITHOUT CONSENT OF HOLDERS. The Issuers and/or one or more
Guarantors and the Trustee may modify, waive, amend or supplement this
Indenture, the Senior Notes, the Guarantees or the Collateral Documents without
notice to or consent of any Noteholder:
(1) to comply with Section 5.1 hereof;
(2) to provide for uncertificated Senior Notes in addition to or
in place of certificated Senior Notes;
(3) to comply with any requirements of the SEC under the TIA;
(4) to cure any ambiguity, defect or inconsistency, or to make any
other change that does not adversely affect the rights of any Noteholder;
(5) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Senior Notes;
(6) to enter into additional or supplemental Collateral Documents
consistent with the terms hereof;
(7) to adjust the aggregate principal amount of Senior Notes
permitted to be issued pursuant to this Indenture so that the aggregate
principal amount of Senior Notes permitted to be issued pursuant to this
Indenture are as provided in the Plan of Reorganization;
(8) to reflect the terms of any agreements with creditors of the
Issuers and their respective Subsidiaries entered into pursuant to the Plan of
Reorganization or otherwise
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approved by the Bankruptcy Court in the Cases, or to otherwise comply with the
terms of the Plan of Reorganization;
(9) to add to the covenants of the Issuers for the benefit of the
Holders or to surrender any right or power herein conferred upon the Issuers;
(10) to make any change that would provide any additional rights
or benefits to the Holders of the Senior Notes (including providing for
Guarantees of the Senior Notes and any supplemental indenture required pursuant
to Section 4.24 hereof) or that does not adversely affect the legal rights under
this Indenture of any such Holder; or
(11) to add any additional Events of Default.
The Trustee is hereby authorized to join with the Issuers and the
Guarantors, if any, in the execution of any modification, waiver, amendment or
supplement to this Indenture, the Senior Notes, the Guarantees or the Collateral
Documents authorized or permitted by the terms of this Indenture and to make any
further appropriate agreements and stipulations which may be therein contained,
but the Trustee shall not be obligated to enter into any such modification,
waiver, amendment or supplement to this Indenture, the Senior Notes, the
Guarantees or the Collateral Documents which adversely affects its own rights,
duties or immunities under this Indenture.
SECTION 8.2. WITH CONSENT OF HOLDERS. The Issuers and/or one or more
Guarantors and the Trustee may modify, amend, waive or supplement this
Indenture, the Senior Notes, the Guarantees or the Collateral Documents (subject
to any amendment provisions contained therein) with the written consent of the
Holders of not less than a majority in aggregate principal amount of outstanding
Senior Notes. The Holders of not less than a majority in aggregate principal
amount of outstanding Senior Notes may waive compliance in a particular instance
by the Issuers with any provision of this Indenture or the Senior Notes. Subject
to Section 8.4, without the consent of each Noteholder affected, however, an
amendment, supplement or waiver, including a waiver pursuant to Section 6.4, may
not:
(1) reduce the amount of Senior Notes whose Holders must consent
to an amendment, modification, supplement or waiver to this Indenture or the
Senior Notes;
(2) reduce the rate of or change the time for payment of interest
on any Senior Note;
(3) reduce the principal of or premium on or change the stated
maturity of any Senior Note;
(4) make any Senior Note payable in money other than that stated
in the Senior Note or change the place of payment from New York, New York;
(5) change the amount or time of any payment required by the
Senior Notes;
(6) waive a default in the payment of the principal of, or
interest on, or redemption payment with respect to any Senior Note;
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(7) subordinate in right of payment, or otherwise subordinate, the
Senior Notes or the Guarantees to another Indebtedness or obligation of the
Issuers or the Guarantors;
(8) take any other action otherwise expressly prohibited by this
Indenture to be taken without the consent of each Holder affected thereby;
(9) release all or substantially all of the Collateral from the
Lien of this Indenture and the Collateral Documents (other than pursuant to an
Asset Sale in compliance with Section 4.8 hereof), or upon payment in full of
all Obligations of the Issuers hereunder and under the Senior Notes; or
(10) modify this Section 8.2, Section 6.4 or 6.7.
After a modification, amendment, supplement or waiver under this Section
8.2 becomes effective, the Issuers shall mail to the Holders a notice briefly
describing the modification, amendment, supplement or waiver. Any failure of the
Issuers to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such modification, amendment,
supplement or waiver.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, modification,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
SECTION 8.3. COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment to or
supplement of this Indenture or the Senior Notes shall comply with the TIA as
then in effect.
SECTION 8.4. REVOCATION AND EFFECT OF CONSENTS. Until a modification,
amendment, supplement, waiver or other action becomes effective, a consent to it
by a Holder of a Senior Note is a continuing consent conclusive and binding upon
such Holder and every subsequent Holder of the same Senior Note or portion
thereof, and of any Senior Note issued upon the transfer thereof or in exchange
therefor or in place thereof, even if notation of the consent is not made on any
such Senior Note. Any such Holder or subsequent Holder, however, may revoke the
consent as to his Senior Note or portion of a Senior Note, if the Trustee
receives the notice of revocation before the date the modification, amendment,
supplement, waiver or other action becomes effective. Notwithstanding the
foregoing, nothing in this paragraph shall impair the right of any Holder under
TIA Section 316(b).
The Issuers may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any modification,
amendment, supplement, or waiver. If a record date is fixed, then,
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such modification, amendment, supplement, or waiver or to
revoke any consent previously given, whether or not such Persons continue to be
Holders after such record date. No such consent shall be valid or effective for
more than 90 days after such record date unless the consent of the requisite
number of Holders has been obtained.
After a modification, amendment, supplement, waiver or other action
becomes effective, it shall bind every Holder and every subsequent Holder.
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SECTION 8.5. NOTATION ON OR EXCHANGE OF SENIOR NOTES. If a modification,
amendment, supplement or waiver changes the terms of a Senior Note, the Trustee
may request the Holder of the Senior Note to deliver it to the Trustee. In such
case, the Trustee shall place an appropriate notation on the Senior Note about
the changed terms and return it to the Holder. Alternatively, if the Issuers or
the Trustee so determines, the Issuers in exchange for the Senior Note shall
issue and the Trustee shall authenticate a new security that reflects the
changed terms. Failure to make the appropriate notation or issue a new Senior
Note shall not affect the validity and effect of such modification, amendment,
supplement or waiver.
SECTION 8.6. TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee shall sign any
modification, amendment, supplement or waiver authorized pursuant to this
Article 8 if the modification, amendment, supplement or waiver does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may, but need not, sign it. In signing or refusing to
sign such modification, amendment, supplement or waiver, the Trustee shall be
provided with and, subject to Section 7.1 hereof, shall be fully protected in
relying upon an Officers' Certificate and an Opinion of Counsel stating that
such modification, amendment, supplement or waiver is authorized or permitted by
this Indenture and such supplemental indenture constitutes the legal, valid and
binding obligation of the Issuers and the Guarantors enforceable against each of
them in accordance with its terms (subject to customary exceptions). Neither
Issuer nor any Guarantor may sign a modification, amendment or supplement until
the Board of Directors of such Issuer or such Guarantor, as appropriate,
approves it.
ARTICLE 9
Discharge Of Indenture; Defeasance
----------------------------------
SECTION 9.1. DISCHARGE OF INDENTURE. The Issuers and the Guarantors, if
any, may terminate their obligations under the Senior Notes, the Guarantees, if
any, and this Indenture, except the obligations referred to in the last
paragraph of this Section 9.1, if there shall have been cancelled by the Trustee
or delivered to the Trustee for cancellation all Senior Notes theretofore
authenticated and delivered (other than any Senior Notes that are asserted to
have been destroyed, lost or stolen and that shall have been replaced as
provided in Section 2.7 hereof) and the Issuers have paid all sums payable by
them hereunder or deposited all required sums with the Trustee.
After such delivery the Trustee upon request shall acknowledge in writing
the discharge of the Issuers' and the Guarantors' obligations under the Senior
Notes, the Guarantees and this Indenture, except for those surviving obligations
specified below.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuers in Sections 2.7, 7.7, 9.5, 9.6 and 9.8 hereof shall
survive such satisfaction and discharge.
SECTION 9.2. LEGAL DEFEASANCE. The Issuers may at their option, by Board
Resolutions, be discharged from their obligations with respect to the Senior
Notes and the Guarantors, if any, discharged from their obligations under the
Guarantees, if any, on the date the conditions set forth in Section 9.4 below
are satisfied (hereinafter, "Legal Defeasance"). For this purpose, such Legal
Defeasance means that the Issuers shall be deemed to have paid and
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discharged the entire Indebtedness represented by the Senior Notes and to have
satisfied all their other obligations under such Senior Notes and this Indenture
insofar as such Senior Notes are concerned (and the Trustee, at the expense of
the Issuers, shall, subject to Section 9.6 hereof, execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of
outstanding Senior Notes to receive solely from the trust funds described in
Section 9.4 hereof and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest on such Senior Notes
when such payments are due, (B) the Issuers' obligations with respect to such
Senior Notes under Sections 2.3, 2.4, 2.5, 2.6, 2.7, 2.8 and 4.20 hereof, (C)
the rights, powers, trusts, duties, and immunities of the Trustee hereunder
(including claims of, or payments to, the Trustee under or pursuant to Section
7.7 hereof) and (D) this Article 9. Subject to compliance with this Article 9,
the Issuers may exercise their option under this Section 9.2 with respect to the
Senior Notes notwithstanding the prior exercise of their option under Section
9.3 below with respect to the Senior Notes.
SECTION 9.3. COVENANT DEFEASANCE. At the option of the Issuers, pursuant
to each Issuer's Board Resolution, the Issuers and the Guarantors, if any, shall
be released from their respective obligations under Sections 4.2 through 4.4
hereof, inclusive, Sections 4.6 through 4.17 hereof, inclusive, and Section 4.23
and clauses (iii) and (iv) of Section 5.1 hereof with respect to the outstanding
Senior Notes on and after the date the conditions set forth in Section 9.4
hereof are satisfied (hereinafter, "Covenant Defeasance") and the Senior Notes
shall thereafter be deemed to not be outstanding for purposes of any direction,
waiver, consent, declaration or act of the Holders (and the consequences
thereof) in connection with such covenants but shall continue to be outstanding
for all other purposes hereunder. For this purpose, such Covenant Defeasance
means that the Issuers and the Guarantors, if any, may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such specified Section or portion thereof, whether directly or
indirectly by reason of any reference elsewhere herein to any such specified
Section or portion thereof (including any such reference in Section 1.1 hereof)
or by reason of any reference in any such specified Section or portion thereof
to any other provision herein or in any other document, but the remainder of
this Indenture and the Senior Notes shall be unaffected thereby.
SECTION 9.4. CONDITIONS TO LEGAL DEFEASANCE OR COVENANT DEFEASANCE. The
following shall be the conditions to application of Section 9.2 or Section 9.3
hereof to the outstanding Senior Notes:
(1) the Issuers shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 7.10 hereof who shall agree to comply with the provisions of this
Article 9 applicable to it) as funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of the Senior Notes, (A) money in an amount, or
(B) U.S. Government Obligations which through the scheduled payment of principal
and interest in respect thereof in accordance with their terms will provide, not
later than the due date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which shall be applied by
the Trustee (or other qualifying trustee) to pay and discharge, the principal
of, premium, if any, and accrued
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interest on the outstanding Senior Notes at the maturity date of such principal,
premium, if any, or interest, or on dates for payment and redemption of such
principal, premium, if any, and interest selected in accordance with the terms
of this Indenture and of the Senior Notes;
(2) no Event of Default or Default with respect to the Senior
Notes shall have occurred and be continuing on the date of such deposit, or
shall have occurred and be continuing at any time during the period ending on
the 91st day after the date of such deposit or, if longer, ending on the day
following the expiration of the longest preference period under any Bankruptcy
Law applicable to the Issuers in respect of such deposit (it being understood
that this condition shall not be deemed satisfied until the expiration of such
period);
(3) such Legal Defeasance or Covenant Defeasance shall not result
in a breach or violation of, or constitute default under any other agreement or
instrument to which either of the Issuers is a party or by which it is bound;
(4) the Issuers shall have delivered to the Trustee an Opinion of
Counsel stating that, as a result of such Legal Defeasance or Covenant
Defeasance, neither the trust nor the Trustee will be required to register as an
investment company under the Investment Company Act of 1940, as amended;
(5) in the case of an election under Section 9.2 above, the
Issuers shall have delivered to the Trustee an Opinion of Counsel stating that
(i) the Issuers have received from, or there has been published by, the Internal
Revenue Service a ruling to the effect that or (ii) there has been a change in
any applicable Federal income tax law with the effect that, and such opinion
shall confirm that, the Holders of the outstanding Senior Notes or persons in
their positions will not recognize income, gain or loss for Federal income tax
purposes solely as a result of such Legal Defeasance and will be subject to
Federal income tax on the same amounts, in the same manner, including as a
result of prepayment, and at the same times as would have been the case if such
Legal Defeasance had not occurred;
(6) in the case of an election under Section 9.3 hereof, the
Issuers shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of the outstanding Senior Notes will not recognize income, gain
or loss for Federal income tax purposes as a result of such Covenant Defeasance
and will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
(7) the Issuers shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that (a) all conditions
precedent provided for relating to either the Legal Defeasance under Section 9.2
above or the Covenant Defeasance under Section 9.3 hereof (as the case may be)
have been complied with and (b) if any other Indebtedness of either of the
Issuers shall then be outstanding, such legal defeasance or covenant defeasance
will not violate the provisions of the agreements or instruments evidencing such
Indebtedness; and
(8) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause (1) was not made by the
Issuers with the intent of defeating, hindering, delaying or defrauding any
creditors of the Issuers or others.
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SECTION 9.5. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD
IN TRUST; OTHER MISCELLANEOUS PROVISIONS. All money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee pursuant
to Section 9.4 hereof in respect of the outstanding Senior Notes shall be held
in trust and applied by the Trustee, in accordance with the provisions of such
Senior Notes and this Indenture, to the payment, either directly or through any
Paying Agent as the Trustee may determine, to the Holders of such Senior Notes,
of all sums due and to become due thereon in respect of principal, premium, if
any, and accrued interest, but such money need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no duty
to invest such money or U.S. Government Obligations.
The Issuers and the Guarantors shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 9.4 hereof or the
principal, premium, if any, and interest received in respect thereof other than
any such tax, fee or other charge which by law is for the account of the Holders
of the outstanding Senior Notes.
Subject to Sections 7.1 and 7.2 hereof, anything in this Article 9 to the
contrary notwithstanding, the Trustee shall deliver or pay to the Issuers from
time to time upon Issuers' Request any money or U.S. Government Obligations held
by it as provided in Section 9.4 hereof which, in the opinion of a
nationally-recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
SECTION 9.6. REINSTATEMENT. If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with Section 9.1,
9.2 or 9.3 hereof 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 obligations of the Issuers and any
Guarantor under this Indenture, the Senior Notes and the Guarantees, if any,
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article 9 until such time as the Trustee or Paying Agent is permitted to
apply all such money or U.S. Government Obligations in accordance with Section
9.1 hereof; provided, however, that if the Issuers or any Guarantors have made
any payment of principal of, premium, if any, or accrued interest on any Senior
Notes because of the reinstatement of their obligations, the Issuers or such
Guarantors, as the case may be, shall be subrogated to the rights of the Holders
of such Senior Notes to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
SECTION 9.7. MONEYS HELD BY PAYING AGENT. In connection with the
satisfaction and discharge of this Indenture, all moneys then held by any Paying
Agent under the provisions of this Indenture shall, upon demand of the Issuers,
be paid to the Trustee, or if sufficient moneys have been deposited pursuant to
Section 9.4 hereof, to the Issuers (or, if such moneys had been deposited by any
Guarantors, to such Guarantors), and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
SECTION 9.8. MONEYS HELD BY TRUSTEE. Any moneys deposited with the
Trustee or any Paying Agent or then held by the Issuers or any Guarantors in
trust for the payment of the
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principal of, premium, if any, or interest on any Senior Note that are not
applied but remain unclaimed by the Holder of such Senior Note for two years
after the date upon which the principal of, or premium, if any, or interest on
such Senior Note shall have respectively become due and payable shall be repaid
to the Issuers (or, if appropriate, the Guarantors) upon Issuers' Request, or if
such moneys are then held by the Issuers or any Guarantors in trust, such moneys
shall be released from such trust; and the Holder of such Senior Note entitled
to receive such payment shall thereafter, as an unsecured general creditor, look
only to the Issuers and the Guarantors, if any, for the payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money
shall thereupon cease; PROVIDED, HOWEVER, that the Trustee or any such Paying
Agent, before being required to make any such repayment, may, at the expense of
the Issuers and the Guarantors, if any, either mail to each Noteholder affected,
at the address shown in the register of the Senior Notes maintained by the
Registrar pursuant to Section 2.3 hereof, or cause to be published once a week
for two successive weeks, in a newspaper published in the English language,
customarily published each Business Day and of general circulation in the city
of New York, New York, a notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such mailing or publication, any unclaimed balance of such moneys then
remaining will be repaid to the Issuers. After payment to the Issuers or the
Guarantors, if any, or the release of any money held in trust by the Issuers or
any Guarantors, as the case may be, Noteholders entitled to the money must look
only to the Issuers and any Guarantors for payment as general creditors unless
applicable abandoned property law designates another person.
SECTION 9.9. SENIOR NOTE COLLATERAL. Upon the Issuers' exercise under
Section 9.1 hereof of the option applicable under either Section 9.2 or 9.3, the
Collateral shall be released pursuant to Section 10.3 hereof.
ARTICLE 10
Collateral And Security
-----------------------
SECTION 10.1. SECURITY. The due and punctual payment of the principal of,
premium, if any, and interest on the Senior Notes when and as the same shall be
due and payable, whether on an Interest Payment Date, at maturity, by
acceleration, repurchase, redemption or otherwise, and interest on the overdue
principal of, premium, if any, and interest on the Senior Notes and performance
of all other obligations of the Issuers and the Guarantors to the Holders of
Senior Notes, the Trustee or the Collateral Agent under this Indenture, the
Senior Notes, the Guarantees and the other Senior Notes Documents, according to
the terms hereunder or thereunder, shall be secured by the Collateral, as
provided in the Collateral Documents which the Issuers and the applicable
parties have entered into simultaneously with the execution of this Indenture
for the benefit of the Holders of Senior Notes. Each Holder of Senior Notes, by
its acceptance thereof, consents and agrees to the terms of the Collateral
Documents (including, without limitation, the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be
amended from time to time in accordance with its terms and authorizes and
directs the Collateral Agent to enter into the Collateral Documents and to
perform its obligations and exercise its rights thereunder in accordance
therewith. The Issuers and the Guarantors shall deliver to the Collateral Agent
copies of all documents executed pursuant to this Indenture and the Collateral
Documents and shall do or cause to be done all such acts and things as may be
71
necessary or proper, or as may be required by the provisions of the Collateral
Documents to assure and confirm to the Collateral Agent the security interest in
the Collateral contemplated hereby, by the Collateral Documents or any part
thereof, as from time to time constituted, so as to render the same available
for the security and benefit of this Indenture and of the Senior Notes and the
Guarantees secured hereby, according to the intent and purposes herein
expressed. The Issuers shall take, or shall cause their Subsidiaries to take any
and all actions reasonably required to cause the Collateral Documents to create
and maintain, as security for the obligations of the Issuers hereunder, a valid
and enforceable perfected priority Lien in and on all the Collateral in
accordance with the terms of the Collateral Documents.
SECTION 10.2. CERTIFICATES, OPINIONS AND RECORDING. The Issuers and the
Guarantors will cause this Indenture, if necessary, the applicable Collateral
Documents, including any financing statements, all amendments or supplements to
each of the foregoing and any other similar security documents as necessary, to
be registered, recorded and filed and/or re-recorded, re-filed and renewed in
such manner and in such place or places, if any, as may be required by law in
order fully to preserve and protect the Lien securing the obligations under the
Senior Notes and the Guarantees of the Guarantors and to effectuate and preserve
the security of the Holders of Senior Notes and all rights of the Collateral
Agent.
The Issuers, the Guarantors and any other obligor shall furnish to the
Trustee:
(a) Promptly after the execution and delivery of this Indenture, and
promptly after the execution and delivery of any other instrument of further
assurance or amendment, an Opinion of Counsel in the United States (which may
include one or more local counsel opinions as to matters concerning the laws of
affected jurisdictions) (i) stating that this Indenture, the Senior Notes, the
Collateral Documents and such instruments of further assurance or amendment, if
any, are valid, binding and enforceable obligations of Holdings and its
Subsidiaries which are signatories to those agreements, subject to customary
qualifications and exceptions (and any other qualifications and exceptions
reasonably acceptable to the Collateral Agent), and (ii) either (A) stating
that, subject to customary assumptions and exclusions (and any other
qualifications and exceptions reasonably acceptable to the Collateral Agent), in
the opinion of such counsel, this Indenture and other applicable Collateral
Documents or such instruments of further assurance or amendment either (i) have
been recorded, registered and filed to the extent necessary to make effective
the Lien intended to be created by this Indenture and such Collateral Documents
or documents of further assurance (as the case may be) or (ii) are in proper
form to be recorded, registered and filed in the filing offices specified in
such opinion and upon such filing will make effective the Lien intended to be
created by this Indenture and such Collateral Documents, and reciting the
details of such action or referring to prior Opinions of Counsel in which such
details are given, and stating that, subject to customary assumptions and
exclusions (and any other qualifications and exceptions reasonably acceptable to
the Trustee), as to such Indenture and Collateral Documents and such other
instruments such recording, registering and filing will be the only recordings,
registrations and filings necessary to perfect or give constructive notice of
the Liens granted therein and that no re-recordings, re-registerings or
re-filings will be necessary to maintain such perfection or notice, and further
stating that all financing statements and continuation statements (as
applicable) have been executed and provisions for the filing thereof have been
made to the reasonable satisfaction of the Collateral Agent that are necessary
fully to preserve and protect the rights of the Holders of Senior Notes
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and the Collateral Agent hereunder and under the Collateral Documents or (B)
stating that, subject to customary assumptions and exclusions (and any other
qualifications and exceptions reasonably acceptable to the Collateral Agent), in
the opinion of such counsel, no such action is necessary to make any Lien
created under the Indenture and/or any of the Collateral Documents effective as
intended by this Indenture and such Collateral Documents; and
(b) Within 30 days after each anniversary of the date of this Indenture,
an Opinion of Counsel, dated as of such date (which may include one or more
local counsel opinions as to matters concerning the laws of affected
jurisdictions), either (i) stating that, subject to customary assumptions and
exclusions (and any other qualifications and exceptions reasonably acceptable to
the Collateral Agent), in the opinion of such counsel, such action has been
taken with respect to the recording, registering, filing, re-recording,
re-registering and re-filing of this Indenture, the Collateral Documents and all
supplemental indentures, financing statements, continuation statements or other
instruments of further assurance as is necessary to maintain the Lien of this
Indenture and the Collateral Documents until the next Opinion of Counsel is
required to be rendered pursuant to this paragraph and reciting the details of
such action or referring to prior Opinions of Counsel in which such details are
given, and stating that all financing statements and continuation statements
have been executed and filed that are necessary fully to preserve and protect
the rights of the Holders and the Collateral Agent hereunder and under the
Collateral Documents or (ii) stating that, subject to customary assumptions and
exclusions (and any other qualifications and exceptions reasonably acceptable to
the Collateral Agent), in the opinion of such counsel, no such action is
necessary to maintain such Lien, until the next Opinion of Counsel is required
to be rendered pursuant to this paragraph.
(c) The Issuers shall furnish to the Collateral Agent the certificate or
opinions with respect to compliance with a condition or covenant provided for in
this Indenture (other than a certificate provided pursuant to TIA Section
314(a)(4)), as the case may be, required by TIA Section 314(d). Such
certificates or opinions will be subject to the terms of TIA Section 314(e).
SECTION 10.3. RELEASE OF COLLATERAL. (a) Subject to subsections (b), (c),
(d), (e) and (f) of this Section 10.3, Collateral may be released from the Lien
and security interest created by this Indenture and the Collateral Documents at
any time or from time to time upon the request of the Issuers pursuant to an
Officers' Certificate from each Issuer certifying that all terms for release and
conditions precedent hereunder and under the applicable Collateral Document have
been met and specifying (A) the identity of the Collateral to be released and
(B) the provision of this Indenture that authorizes such release. The Collateral
Agent shall release (at the sole cost and expense of the Issuers) (i) all
Collateral that is contributed, sold, leased, conveyed, transferred or otherwise
disposed of, provided such contribution, sale, lease, conveyance, transfer or
other disposition is or will be in accordance with the provisions of this
Indenture, including, without limitation, the requirement that the Asset Sale
Proceeds, if any, from such contribution, sale, lease, conveyance, transfer or
other disposition are or will be applied in accordance with this Indenture and
that no Default or Event of Default has occurred and is continuing or would
occur immediately following such release; (ii) Collateral which may be released
with the consent of Holders pursuant to Article 8 hereof; (iii) all Collateral
(except as provided in Article 9 hereof) upon discharge or defeasance of this
Indenture in accordance with Article 9 hereof; (iv) all Collateral upon the
indefeasible payment in full of all obligations of the Issuers with respect
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to the Senior Notes; and (v) Collateral of a Guarantor whose Guarantee is
released pursuant to Section 11.4 hereof. Upon receipt of such Officers'
Certificates, an Opinion of Counsel and any other opinions or certificates
required by this Indenture and the TIA, the Trustee shall execute, deliver or
acknowledge any necessary or proper instruments of termination, satisfaction or
release to evidence the release of any Collateral permitted to be released
pursuant to this Indenture and the Collateral Documents.
(b) No Collateral shall be released from the Lien and security interest
created by the Collateral Documents pursuant to the provisions of the Collateral
Documents unless there shall have been delivered to the Collateral Agent the
certificates required by this Section 10.3.
(c) The Collateral Agent may release Collateral from the Lien and
security interest created by this Indenture and the Collateral Documents upon
the sale or disposition of Collateral pursuant to the Collateral Agent's powers,
rights and duties with respect to remedies provided under any of the Collateral
Documents.
(d) The release of any Collateral from the terms of this Indenture and
the Collateral Documents shall not be deemed to impair the security under this
Indenture in contravention of the provisions hereof if and to the extent the
Collateral is released pursuant to the terms hereof. To the extent applicable,
the Issuers shall cause TIA Section 313(b), relating to reports, and TIA Section
314(d), relating to the release of property or securities from the Lien and
security interest of the Collateral Documents and relating to the substitution
therefor of any property or securities to be subjected to the Lien and security
interest of the Collateral Documents, to be complied with. Any certificate or
opinion required by TIA Section 314(d) may be made by an Officer of the Issuers
except in cases where TIA Section 314(d) requires that such certificate or
opinion be made by an independent Person, which Person shall be an independent
engineer, appraiser or other expert selected or approved by the Collateral Agent
in the exercise of reasonable care.
(e) Notwithstanding the foregoing, each Issuer and each Subsidiary, as
the case may be, pursuant to the terms of this Indenture and the Collateral
Documents, may effect any disposition of Collateral and such Collateral shall be
released from the Lien and security interest created by this Indenture and the
Collateral Documents without the delivery of any opinions or certificates upon
any such release; provided that (i) Section 4.10 is complied with and (ii) any
property or assets acquired with any proceeds of such disposition becomes
subject to the Lien and security interest created by this Indenture and the
Collateral Documents; provided, further, that each Issuer shall deliver to the
Trustee and Collateral Agent, within 15 days after each of the six-month periods
ended April 15 and October 15 in each year, an Officers' Certificate to the
effect that all releases of Collateral by either Issuer or any Subsidiary, as
the case may be, during the preceding six-month period were in accordance with
the provisions of the Collateral Documents and this Indenture and that all
proceeds therefrom were used by such Issuer or such Subsidiary as permitted
herein (or will be so used within the time permitted by this Indenture).
(f) The fair value of Collateral released from the Lien and security
interest created by this Indenture and the Collateral Documents pursuant to
Section 10.3(e) hereof shall not be considered in determining whether the
aggregate fair value of Collateral released from the Lien and security interest
created by this Indenture and the Collateral Documents in any calendar
74
year exceeds the 10% threshold specified in Section 314(d)(l) of the TIA;
provided that the Issuers' right to rely on this sentence at any time is
conditioned upon the Issuers having furnished to the Trustee and Collateral
Agent the certificates described in Section 10.3(e) hereof that were required to
be furnished to the Trustee and Collateral Agent at or prior to such time.
SECTION 10.4. PROTECTION OF THE TRUST ESTATE. Upon prior written notice
to the Issuers and the Guarantors and so long as an Event of Default shall exist
and be continuing, the Trustee shall have the power, subject to the provisions
of the Collateral Documents, (i) to institute and maintain such suits and
proceedings as it may deem expedient, to prevent any impairment of the
Collateral under any of the Collateral Documents; and (ii) to enforce the
obligations of the Issuers, the Guarantors or any Restricted Subsidiary under
this Indenture or the Collateral Documents, to institute and maintain such suits
and proceedings as may be expedient to prevent any impairment of the Collateral
under the Collateral Documents and in the profits, rents, revenues and other
income arising therefrom; including the power to institute and maintain suits or
proceedings to restrain the enforcement of or compliance with any legislative or
other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment,
rule or order would impair any Collateral or be prejudicial to the interests of
the Holders of Senior Notes, the Trustee or the Collateral Agent, to the extent
permitted thereunder.
SECTION 10.5. CERTIFICATES OF THE ISSUERS. The Issuers shall furnish to
the Trustee and Collateral Agent, prior to each proposed release of Collateral
pursuant to the Collateral Documents (i) all documents required by TIA Section
314(d) and (ii) an Opinion of Counsel in the United States, which opinion shall
be subject to customary assumptions and exclusions, to the effect that such
accompanying documents constitute all documents required by TIA Section 314(d).
The Trustee may, to the extent permitted by Sections 7.1 and 7.2 hereof, accept
as conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such documents and such Opinion of Counsel.
SECTION 10.6. CERTIFICATES OF THE TRUSTEE. In the event that the Issuers
wish to release Collateral in accordance with the Collateral Documents and have
delivered the certificates and documents required by the Collateral Documents
and Sections 10.3 and 10.5 hereof, the Trustee shall determine whether it has
received all documents required by TIA Section 314(d) in connection with such
release and, based on such determination and the Opinion of Counsel delivered
pursuant to Section 10.5(ii), shall deliver a certificate to the Collateral
Agent, setting forth such determination.
SECTION 10.7. AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE COLLATERAL
AGENT UNDER THE COLLATERAL DOCUMENTS. Subject to the provisions of Sections 7.1
and 7.2 hereof and the Collateral Agreement, the Collateral Agent may, without
the consent of the Holders of Senior Notes, take all actions it deems necessary
or appropriate in order to (a) enforce any of the terms of the Collateral
Documents and (b) collect and receive any and all amounts payable in respect of
the Obligations of the Issuers hereunder. Subject to the Intercreditor
Agreement, the Collateral Agent shall have power to institute and maintain such
suits and proceedings as it may deem expedient to prevent any impairment of the
Collateral by any acts that may be unlawful or in violation of the Collateral
Documents or this Indenture, and such suits and proceedings as the Trustee may
deem expedient to preserve or protect its interests and the interests of the
Holders of
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Senior Notes in the Collateral (including power to institute and maintain suits
or proceedings to restrain the enforcement of or compliance with any legislative
or other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment,
rule or order would impair the security interest hereunder or be prejudicial to
the interests of the Holders of Senior Notes or of the Collateral Agent).
SECTION 10.8. AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER THE
COLLATERAL DOCUMENTS. Subject to the Intercreditor Agreement, upon an Event of
Default and so long as such Event of Default continues, the Collateral Agent may
exercise in respect of the Collateral, in addition to the other rights and
remedies provided for herein, in the Collateral Documents or otherwise available
to it, all of the rights and remedies of a secured party under the Uniform
Commercial Code or other applicable law, and the Trustee may also upon obtaining
possession of the Collateral as set forth herein, without notice to the Issuers,
except as specified below, sell the Collateral or any part thereof in one or
more parcels at public or private sale, at any exchange, broker's board or at
any of the Trustee's offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Trustee may deem commercially
reasonable. The Issuers acknowledge and agree that any such private sale may
result in prices and other terms less favorable to the seller than if such a
sale were a public sale. The Issuers agree that, to the extent notice of sale
shall be required by law, at least 10 days' notice to the Issuers of the time
and place of any public sale or the time after which any private sale is to be
made shall constitute reasonable notification. The Collateral Agent shall not be
obligated to make any sale regardless of notice of sale having been given. The
Collateral Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned.
Any cash that is Collateral held by the Collateral Agent and all cash
proceeds received by the Trustee in respect of any sale of, collection from, or
other realization upon all or any part of the Collateral shall be applied
(unless otherwise provided for in the Collateral Documents) in accordance with
Section 6.10 hereof, or as the Holders of the Senior Notes shall direct pursuant
to Section 6.5 hereof. Any surplus of such cash or cash proceeds held by the
Collateral Agent and remaining after payment in full of all the obligations
shall be paid over to the Issuers or to whomsoever may be lawfully entitled to
receive such surplus or as a court of competent jurisdiction may direct.
SECTION 10.9. TERMINATION OF SECURITY INTEREST. Upon the indefeasible
payment in full of all Obligations of the Issuers under this Indenture and the
Senior Notes, or upon Legal Defeasance or Covenant Defeasance, the Trustee
shall, at the request of the Issuers, deliver a certificate to the Collateral
Agent stating that such Obligations have been paid in full, and instruct the
Collateral Agent to release the Liens pursuant to this Indenture and the
Collateral Documents.
SECTION 10.10. COOPERATION OF TRUSTEE. In the event the Issuers or any
Guarantor pledges or grants to the Trustee a security interest in additional
Collateral, the Trustee shall cooperate with the Issuers or such Guarantor in
reasonably and promptly agreeing to the form of, and executing as required, any
instruments or documents necessary to make effective the security interest in
the Collateral to be so pledged. To the extent practicable, the terms of any
security agreement or other instrument or document necessitated by any such
pledge shall be comparable
76
to the provisions of the existing relevant Collateral Documents. Subject to, and
in accordance with, the requirements of this Article 10 and the terms of the
Collateral Documents, in the event that the Issuers or any Guarantor engages in
any transaction pursuant to Section 10.3, the Trustee and the Collateral Agent,
subject to the provisions of Sections 10.3 and 10.5, shall cooperate with the
Issuers or such Guarantor in order to facilitate such transaction in accordance
with any reasonable time schedule proposed by the Issuers, including by
delivering and releasing the Collateral in a prompt and reasonable manner.
SECTION 10.11. AGENTS UNDER COLLATERAL DOCUMENTS. Each Holder hereby
appoints and directs the Collateral Agent to be the agent for and representative
of the Holders with respect to the Collateral and the Collateral Documents,
subject to the Intercreditor Agreement.
ARTICLE 11
Guarantee of Senior Notes
-------------------------
SECTION 11.1. GUARANTEE. Subject to the provisions of this Article 11,
each Guarantor hereby jointly and severally unconditionally and irrevocably
guarantees to each Holder and to the Trustee, on behalf of the Holders, (i) the
due and punctual payment of the principal of, premium, if any, and interest on
each Senior Note, when and as the same shall become due and payable, whether at
maturity, by acceleration or otherwise, the due and punctual payment of interest
on the overdue principal of, and premium, if any, and interest on the Senior
Notes, to the extent lawful, and the due and punctual performance of all other
Obligations of the Issuers to the Holders or the Trustee all in accordance with
the terms of such Senior Note and this Indenture, and (ii) in the case of any
extension of time of payment or renewal of any Senior Notes or any of such other
Obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, at stated maturity, by
acceleration or otherwise. Each Guarantor, by execution of the Guarantee, agrees
that its obligations thereunder and hereunder shall be absolute and
unconditional, irrespective of, and shall be unaffected by, any invalidity,
irregularity or unenforceability of any such Senior Note or this Indenture, any
failure to enforce the provisions of any such Senior Note or this Indenture, any
waiver, modification or indulgence granted to the Issuers with respect thereto
by the Holder of such Senior Note or the Trustee, any release of any Collateral,
or any other circumstances which may otherwise constitute a legal or equitable
discharge of a surety or such Guarantor.
Each Guarantor, by execution of the Guarantee, waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
merger or bankruptcy of either Issuer, any right to require a proceeding first
against either Issuer, protest or notice with respect to any such Senior Note or
the Indebtedness evidenced thereby and all demands whatsoever, and covenants
that the Guarantee will not be discharged as to any such Senior Note except by
payment in full of the principal thereof, premium if any, and interest thereon
and as provided in Section 9.1 hereof. If any Holder or the Trustee is required
by any court or otherwise to return to either Issuer or any Guarantor or any
Custodian, trustee, liquidator or other similar official acting in relation to
either an Issuer or any Guarantor, any amount paid by either an Issuer or any
Guarantor to the Holder or Trustee, each Guarantor's Guarantee, to the extent
therefor discharged, shall be reinstated in full force and effect. Each
Guarantor, by execution of the Guarantee, further agrees that, as between such
Guarantor, on the one hand, and the Holders and
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the Trustee, on the other hand, (i) the maturity of the Obligations guaranteed
by the Guarantee may be accelerated as provided in Article 6 hereof for the
purposes of the Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Obligations
guaranteed thereby, and (ii) in the event of any declaration of acceleration of
such Obligations as provided in Article 6 hereof, such Obligations (whether or
not due and payable) shall forthwith become due and payable by each Guarantor
for the purpose of the Guarantee. In addition, without limiting the foregoing
provisions, upon the effectiveness of an acceleration under Article 6 hereof,
the Trustee shall promptly make a demand for payment on the Senior Notes under
any Guarantee provided for in this Article 11 and not discharged. Failure to
make such demand shall not affect the validity or enforceability of the
Guarantee upon any Guarantor.
A Guarantee shall not be valid or become obligatory for any purpose with
respect to a Senior Note unless the certificate of authentication on such Senior
Note shall have been signed by or on behalf of the Trustee.
Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorney's fees and expenses) incurred by the Trustee as a
representative of any Holder in enforcing any rights under this section.
SECTION 11.2. EXECUTION AND DELIVERY OF GUARANTEES. The delivery of any
Senior Note by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of the Guarantee set forth in this Indenture on behalf
of each Guarantor.
SECTION 11.3. LIMITATION OF GUARANTEE. The obligations of each Guarantor
will be limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or
pursuant to its contribution obligations under this Indenture, result in the
obligations of such Guarantor under the Guarantee not constituting a fraudulent
conveyance or fraudulent transfer under Federal or state law. Each Guarantor
that makes a payment or distribution under a Guarantee shall be entitled to a
contribution from each other Guarantor in a pro rata amount based on the
Adjusted Net Assets of each Guarantor.
SECTION 11.4. RELEASE OF GUARANTOR. A Guarantor shall be released from
all of its obligations under its Guarantee if:
(i) the Guarantor has sold all or substantially all of its
assets or Holdings and its Subsidiaries have sold all of the
Equity Interests of the Guarantor owned by them, in each case in a
transaction in compliance with Sections 4.10 and 5.1 hereof to the
extent applicable;
(ii) the Guarantor merges with or into or consolidates
with, or transfers all or substantially all of its assets to,
either of the Issuers or another Guarantor in a transaction in
compliance with Section 5.1 hereof; or
(iii) the Guarantor has been designated as an Unrestricted
Subsidiary pursuant to, and in compliance with, Section 4.13 of
this Indenture;
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and in each such case, each of the Issuers has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to such transactions have been
complied with. At the written request of the Issuers, the Trustee will promptly
execute and deliver appropriate instruments in forms reasonably acceptable to
the Issuers evidencing and further implementing any releases or discharges
pursuant to the foregoing provisions.
SECTION 11.5. ADDITIONAL GUARANTORS. Each of the Issuers covenants and
agrees that it will cause any Person which becomes obligated to guarantee the
Senior Notes pursuant to the terms of Section 4.13 hereof, to execute a
Guarantee satisfactory in form and substance to the Trustee pursuant to which
such Person shall guarantee the obligations of the Issuers under the Senior
Notes and this Indenture in accordance with this Article 11 with the same effect
and to the same extent as if such Person had been named herein as a Guarantor.
Notwithstanding the foregoing, if such Person is a Subsidiary incorporated in a
jurisdiction other than the United States, and if and to the extent that the
execution of a Guarantee by such Person would have adverse tax consequences for
Holdings or any of its Subsidiaries, Holdings shall not be obligated to cause
such Person to execute a Guarantee, provided that Holdings shall cause 65% (or
such other greater or lesser percentage which as a result of a change of law may
be pledged without resulting in adverse tax consequences) of the issued and
outstanding shares of stock of such Person to become Collateral as and when
received by Holdings or by any of its Subsidiaries.
ARTICLE 12
Miscellaneous
-------------
SECTION 12.1. TRUST INDENTURE ACT CONTROLS. If any provision of this
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 12.2. NOTICES. Any notice or communication shall be given in
writing and delivered in person, sent by facsimile, delivered by commercial
courier service or mailed by first-class mail, postage prepaid, addressed as
follows:
IF TO THE ISSUERS OR ANY GUARANTOR:
Superior Essex Communications LLC
Essex International Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
WITH A COPY TO: Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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IF TO THE TRUSTEE: The Bank of New York
Corporate Trust Administration
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Such notices or communications shall be effective when received and shall
be sufficiently given if so given within the time prescribed in this Indenture.
The Issuers, any Guarantors or the Trustee by written notice to the
others may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed to him by
first-class mail, postage prepaid, at his address shown on the register kept by
the Registrar. If a notice or communication to a Holder is mailed in the manner
provided above, it shall be deemed duly given on the date so deposited in the
mail, whether or not the addressee receives it.
Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders.
In case, by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
SECTION 12.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS. Holders may
communicate pursuant to TIA Section 312(b) with other Holders with respect to
their rights under this Indenture or the Senior Notes. The Issuers, the
Guarantors, the Trustee, the Registrar and anyone else shall have the protection
of TIA Section 312(c).
SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT. Upon
any request or application by the Issuers or any Guarantor to the Trustee to
take any action under this Indenture, each of the Issuers shall furnish to the
Trustee:
(1) an Officers' Certificate (which shall include the statements
set forth in Section 12.5 below) in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with;
(2) an Opinion of Counsel (which shall include the statements set
forth in Section 12.5 below) in form and substance reasonably satisfactory to
the Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with; and
(3) where applicable, a certificate or opinion by an independent
certified public accountant satisfactory to the Trustee that complies with TIA
Section 314(c).
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SECTION 12.5. Statements Required in Certificate and Opinion. Each
certificate and opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) 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;
(3) a statement that, in the opinion of such Person, it or he has
made such examination or investigation as is necessary to enable it or him to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
Person, such covenant or condition has been complied with.
SECTION 12.6. WHEN TREASURY SENIOR NOTES DISREGARDED. In determining
whether the Holders of the required aggregate principal amount of Senior Notes
have concurred in any direction, waiver or consent, (i) Senior Notes owned by
the Issuers, any Guarantor or any other obligor on the Senior Notes shall be
disregarded as though they were not outstanding and (ii) solely to the extent
required by TIA Section 316(a) and TIA Section 315(d), Senior Notes owned by
Affiliates shall be disregarded as though they were not outstanding, except that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Senior Notes which the
Trustee actually knows are so owned shall be so disregarded. Senior Notes so
owned which have been pledged in good faith shall not be disregarded if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to the Senior Notes and that the pledgee is not the Issuers, a
Guarantor or any other obligor upon the Senior Notes or any Affiliate of any of
them.
SECTION 12.7. RULES BY TRUSTEE AND AGENTS. The Trustee may make
reasonable rules for action by or meetings of Holders. The Registrar and Paying
Agent may make reasonable rules for their functions.
SECTION 12.8. BUSINESS DAYS; LEGAL HOLIDAYS. A "Business Day" is a day
that is not a Legal Holiday. A "Legal Holiday" is a Saturday, a Sunday, a
federally-recognized holiday or a day on which banking institutions are not
required to be open in the State of New York or Atlanta,
Georgia. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period.
SECTION 12.9. GOVERNING LAW. THIS INDENTURE AND THE SENIOR NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE OR THE SENIOR NOTES.
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SECTION 12.10. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. This
Indenture may not be used to interpret another indenture, loan, security or debt
agreement of the Issuers or any Subsidiary thereof. No such indenture, loan,
security or debt agreement may be used to interpret this Indenture.
SECTION 12.11. NO RECOURSE AGAINST OTHERS. No recourse for the payment of
the principal of or premium, if any, or interest on any of the Senior Notes, or
for any claim based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the Issuers or any
Guarantor in this Indenture or in any supplemental indenture, or in any of the
Senior Notes, or because of the creation of any Indebtedness represented
thereby, shall be had against any stockholder, officer, director, partner,
affiliate, beneficiary or employee, as such, past, present or future, of the
Issuers or of any successor corporation or against the property or assets of any
such stockholder, officer, employee, partner, affiliate, beneficiary or
director, either directly or through the Issuers or any Guarantor, or any
successor corporation thereof, whether by virtue of any constitution, statute or
rule of law, or by the enforcement of any assessment or penalty or otherwise; it
being expressly understood that this Indenture and the Senior Notes are solely
obligations of the Issuers and the Guarantors, and that no such personal
liability whatever shall attach to, or is or shall be incurred by, any
stockholder, officer, employee, partner, affiliate, beneficiary or director, as
such, of the Issuers or any Guarantor, or any successor corporation thereof,
because of the creation of the Indebtedness hereby authorized, or under or by
reason of the obligations, covenants or agreements contained in this Indenture
or the Senior Notes or implied therefrom, and that any and all such personal
liability of, and any and all claims against every stockholder, officer,
employee, partner, affiliate, beneficiary and director, as such, are hereby
expressly waived and released as a condition of, and as a consideration for, the
execution of this Indenture and the issuance of the Senior Notes. Such waiver
may not be effective to waive liabilities under federal securities laws and it
is the view of the SEC that such waiver is against public policy. It is
understood that this limitation on recourse is made expressly for the benefit of
any such stockholder, employee, officer, partner, affiliate, beneficiary or
director and may be enforced by any one or all of them.
SECTION 12.12. SUCCESSORS. All agreements of the Issuers and the
Guarantors in this Indenture and the Senior Notes shall bind their respective
successors. All agreements of the Trustee, any additional trustee and any Paying
Agents in this Indenture shall bind their respective successors.
SECTION 12.13. MULTIPLE COUNTERPARTS. The parties may sign multiple
counterparts of this Indenture. Each signed counterpart shall be deemed an
original, but all of them together represent one and the same agreement.
SECTION 12.14. TABLE OF CONTENTS, HEADINGS, ETC. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
SECTION 12.15. SEPARABILITY. Each provision of this Indenture shall be
considered separable and if for any reason any provision which is not essential
to the effectuation of the basic purpose of this Indenture or the Senior Notes
shall be invalid, illegal or unenforceable, the
82
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date and year first written above.
SUPERIOR ESSEX COMMUNICATIONS LLC
By:
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: [Title]
ESSEX GROUP, INC.
By:
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: [Title]
On behalf of each entity named on the
attached Schedule I
By:
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: [Title]
TRUSTEE,
THE BANK OF NEW YORK
By:
---------------------------------------
Name: [Name]
Title: [Title]
EXHIBIT A
FORM OF NOTE
(FACE OF NOTE)
[INSERT THE GLOBAL NOTE LEGEND, IF APPLICABLE PURSUANT TO THE PROVISIONS
OF THE INDENTURE]
NUMBER _________ AMOUNT _________
CUSIP NUMBER _________
SUPERIOR ESSEX COMMUNICATIONS LLC
ESSEX GROUP, INC.
SECOND PRIORITY SECURED NOTES DUE 2008
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN PART OR IN WHOLE PRIOR TO
MATURITY AS SET FORTH BELOW. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF
THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
Superior Essex Communications LLC, a Delaware limited liability company
(the "Company," which term includes any successor corporation), and Essex Group,
Inc., a Delaware corporation (the "Co-Issuer," which term includes any successor
corporation, and together with the Company, herein called the "Issuers"), for
value received jointly and severally promise to pay to _______________ or
registered assigns, the principal sum of _____________________________ Dollars
($_________), on
Interest Payment Dates: [date] and [date] of each year commencing
November o, 200[4].
Record Dates: each [date] and [date].
Issue Date: November o, 2003.
Reference is made to the further provisions of this Senior Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
[SIGNATURE PAGE ATTACHED.]
A-1
IN WITNESS WHEREOF, the Issuers have caused this Second Priority Secured Note
due 2008 to be signed manually or by facsimile by their duly authorized
officers.
SUPERIOR ESSEX COMMUNICATIONS LLC
By:
---------------------------------------
Name:
Title:
By:
---------------------------------------
Name:
Title:
ESSEX GROUP, INC.
By:
---------------------------------------
Name:
Title:
By:
---------------------------------------
Name:
Title:
A-2
Certificate of Authentication:
This is one of the Second Priority Secured Notes due 2008 referred to in
the within-mentioned Indenture.
Dated: November o, ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, as Trustee
By:
-----------------------------------
Authorized Signatory
A-3
(REVERSE SIDE)
SUPERIOR ESSEX COMMUNICATIONS LLC
ESSEX GROUP, INC.
SECOND PRIORITY SECURED NOTES DUE 2008
1. INTEREST.
(a) Superior Essex Communications LLC, a Delaware limited
liability company (the "Company"), and Essex Group, Inc., a Delaware corporation
(the "Co-Issuer" and, together with the Company, the "Issuers"), jointly and
severally promise to pay interest on the principal amount of the Senior Notes at
a rate per annum of 9.5% until the principal hereof shall have become due and
payable, and on any overdue principal and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum compounded
semi-annually, payable semi-annually in arrears on March o and November o of
each year, commencing [ ] (each, an "Interest Payment Date"), to the person in
whose name the Senior Notes are registered at the close of business on the
regular record date for such interest installment, which shall be the first date
of the month in which the relevant Interest Payment Date falls. The amount of
interest payable on any Interest Payment Date shall be computed on the basis of
the actual number of days elapsed and a 360-day year.
(b) If as of the last day of the most recently completed calendar
month which is 30 days prior to the First Interest Payment Date, the sum of (i)
Consolidated Cash Flow Available for Fixed Charges of Holdings does not exceed
$20 million, then, in lieu of making the otherwise due cash payment on such
Interest Payment Date, the Issuers may pay interest as follows: (i) cash
interest at the rate per annum of 4.75%, and (ii) payment in Secondary Senior
Notes identical to the Senior Notes, and on the Second Interest Payment Date if
the Issuers do not issue Secondary Senior Notes on such date or if the Issuers
do issue Secondary Senior Notes on the Second Interest Payment Date, the next
Interest Payment Date, an additional cash payment to each holder, on a pro rata
basis, equal to 0.25% of the aggregate amount of Senior Notes outstanding as of
the applicable record date for such Interest Payment (such amounts, "Additional
Amounts").
(c) If as of the last day of the most recently completed calendar
month which is 30 days prior to the Second Interest Payment Date, the
Consolidated Cash Flow Available for Fixed Charges of Holdings does not exceed
$50 million, then, in lieu of making the otherwise due cash payment on such
Interest Payment Date, the Issuers may pay interest as follows: (i) cash
interest at the rate per annum of 4.75%, and (ii) payment in Secondary Senior
Notes identical to the Senior Notes, including the same maturity date, and on
the next Interest Payment Date an Additional Amount.
2. METHOD OF PAYMENT.
The Issuers will pay interest on this Senior Note provided for in
Paragraph 1 above (except defaulted interest) to the person who is the
registered Holder of this Note at the close of
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business on the first day of the month in which the relevant Interest Payment
Date falls (whether or not such day is a Business Day). The Holder must
surrender this Note to a Paying Agent to collect principal payments due on the
Maturity Date. The Issuers will pay principal, premium, if any, Additional
Amounts, if any, and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts; provided,
however, that the Issuers may pay principal, premium, if any, Additional
Amounts, if any, and interest by check payable in such money. It may mail an
interest check to the Holder's registered address. Notwithstanding the
foregoing, all payments with respect to the Senior Notes, the Holders of which
are entitled to give, and have given, wire transfer instructions to the Paying
Agent on or before the relevant record date pursuant to the Indenture (as
hereinafter defined), shall be made by wire transfer of immediately available
funds to the accounts specified by such Holders.
3. PAYING AGENT AND REGISTRAR.
Initially, The Bank of New York (the "Trustee"), will act as Paying Agent
and Registrar. The Issuers may change any Paying Agent or Registrar without
notice to the Holders of the Senior Notes. Neither of the Issuers nor any of
their Subsidiaries or Affiliates may act as Paying Agent but may act as
Registrar or co-Registrar.
4. INDENTURE AND COLLATERAL DOCUMENTS.
The Issuers issued this Senior Note under an Indenture dated as of [Plan
Effective Date], 2003 (as such may be amended, supplemented, waived and modified
from time to time, the "Indenture"), by and among the Issuers, the Guarantors
party thereto and the Trustee. The terms of this Senior Note include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 as in effect on the date of the Indenture. This
Senior Note is subject to all such terms, and the Holder of this Senior Note is
referred to the Indenture and said Trust Indenture Act for a statement of them.
The terms of the Indenture shall govern any inconsistencies between the
Indenture and the Senior Notes or the Guarantee. The Senior Notes are secured by
the Collateral (as defined in the Indenture) pursuant to the Collateral
Documents and may be released pursuant to the terms thereof, subject to the
terms of this Indenture. The Collateral Documents govern the rights in and to
the Collateral of the holders from time to time of Senior Indebtedness and of
the Trustee and the Holders. All capitalized terms in this Senior Note, unless
otherwise defined, have the meanings assigned to them by the Indenture. Without
limiting the foregoing, each Holder, by accepting this Senior Note, authorizes
the Trustee on behalf of and for the benefit of each Holder, to be the agent for
and representative of each Holder with respect to the Collateral and the
Collateral Documents and authorizes the Trustee to appoint and direct the
Collateral Agent (as defined in the Indenture) to be the agent for and
representative of each Holder with respect to the Collateral and the Collateral
Documents in accordance with the provisions of the Collateral Trust Agreement.
The Senior Notes are secured obligations of the Issuers of up to
$145,000,000 in aggregate principal amount, subject to adjustment as provided in
the Indenture. The Indenture imposes certain restrictions on, among other
things, the Issuers' ability to consolidate or merge with or into, or to
transfer all or substantially all of its assets to, another person.
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5. OPTIONAL REDEMPTION.
Subject to the terms of Section 3.7 of the Indenture, the Issuers may
redeem the Senior Notes, in whole or in part, at any time other than during the
Redemption Period following a Change of Control at a redemption price equal to
100% of the principal amount thereof, plus any accrued and unpaid interest to
the Redemption Date.
6. NOTICE OF REDEMPTION.
Notice of redemption will be mailed via first class mail at least 15 days
but not more than 30 days prior to the Redemption Date to each Holder of Senior
Notes to be redeemed at its registered address as it shall appear on the
register of the Senior Notes maintained by the Registrar. On and after any
Redemption Date, interest will cease to accrue on the Senior Notes or portions
thereof called for redemption unless the Issuers shall default in making the
redemption payment thereon.
7. GUARANTEE.
Payment of principal of, premium, if any, and interest (including
interest on overdue principal and overdue interest (if lawful)) on the Senior
Notes and all other obligations of the Issuers to the Holders will be
unconditionally guaranteed by the Guarantors pursuant to, and subject to the
terms of, Article 11 of the Indenture.
8. COLLATERAL TRUST AGREEMENT.
The Collateral Trust Agreement sets forth the relative rights of the
Trustee and the Holders, on the one hand, and the holders of the Senior
Indebtedness, on the other hand, as to the priority of payment of the Senior
Indebtedness over the Senior Notes and related obligations in certain
circumstances. The terms of the Senior Notes are subject to the terms of the
Collateral Trust Agreement and each Holder, by accepting this Senior Note,
agrees to all of the terms and provisions of the Collateral Trust Agreement
which may be amended from time to time pursuant to the provisions thereof and
this Indenture. Without limiting the foregoing, each Holder, by accepting this
Senior Note, acknowledges and agrees that its rights to payment of the
obligations evidenced by the Senior Notes and the Guarantees are subject to the
terms of the Collateral Trust Agreement, and authorizes the Trustee to give
effect thereto and appoints the Trustee as attorney in fact for such purpose
and, without limitation, expressly authorizes the Trustee to appoint the Joint
Collateral Agent, referred to in the Indenture as the Collateral Agent, pursuant
to the Collateral Trust Agreement and upon the terms thereof.
9. DENOMINATIONS, TRANSFER, EXCHANGE.
The Senior Notes are in registered form without coupons in denominations
of whole dollar integrals. A Holder may register the transfer or exchange of
Senior Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and 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
Senior Note selected for redemption or register the transfer of or exchange any
Senior Note for a period of 15 days before a selection of Senior Notes to be
redeemed or any Senior Note after it is
A-6
called for redemption in whole or in part, except the unredeemed portion of any
Senior Note being redeemed in part.
10. PERSONS DEEMED OWNERS.
The registered Holder of this Senior Note may be treated as the owner of
it for all purposes.
11. UNCLAIMED MONEY.
If money for the payment of principal, premium or interest on any Senior
Note remains unclaimed for two years, the Trustee or Paying Agent will pay the
money back to the Issuers at their request. After that, Holders entitled to
money must look to the Issuers for payment as general creditors unless an
"abandoned property" law designates another person.
12. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture, the Senior Notes, the
Guarantees or the Collateral Documents (subject to any amendment provisions
contained therein) may be modified, amended or supplemented by the Issuers, the
Guarantors and the Trustee with the consent of the Holders of at least a
majority in principal amount of the Senior Notes then outstanding and any
existing default or compliance with any provision may be waived in a particular
instance with the consent of the Holders of at least a majority in principal
amount of the Senior Notes then outstanding. Without the consent of Holders, the
Issuers, the Guarantors and the Trustee may modify, amend the Indenture, the
Senior Notes, the Guarantees or the Collateral Documents or supplement the
Indenture for certain specified purposes, including providing for uncertificated
Senior Notes in addition to certificated Senior Notes, and curing any ambiguity,
defect or inconsistency, or making any other change that does not adversely
affect the rights of any Holder, or to comply with the requirements of the SEC
in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act to enter into additional or supplemental Collateral
Documents, to adjust the principal amount of the Senior Notes issued pursuant to
the Indenture and to otherwise comply with the terms of the Plan of
Reorganization (as defined in the Indenture).
13. SUCCESSOR ENTITY.
When a successor corporation assumes all the obligations of its
predecessor under the Senior Notes and the Indenture and immediately before and
thereafter no Default exists and certain other conditions are satisfied, the
predecessor corporation will be released from those obligations.
14. DEFAULTS AND REMEDIES.
Events of Default are set forth in the Indenture. If an Event of Default
(other than an Event of Default pursuant to Section 6.1(7) or (8) of the
Indenture) occurs and is continuing, the Trustee by notice to the Issuers or the
Holders of not less than 25% in aggregate principal amount of the Senior Notes
then outstanding by written notice to the Issuers and the Trustee, may declare
to be immediately due and payable the entire principal amount of all the Senior
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Notes then outstanding plus premium, if any, and accrued but unpaid interest to
the date of acceleration and such amounts shall become immediately due and
payable. In case an Event of Default specified in Section 6.1(7) or (8) of the
Indenture occurs, such principal amount, together with premium, if any, and
interest with respect to all of the Senior Notes, shall be due and payable
immediately without any declaration or other act on the part of the Trustee or
the Holders of the Notes. The Trustee may withhold from Holders notice of any
continuing default (except a default in payment of principal, premium, if any,
or interest) if it determines that withholding notice is in their interests.
15. TRUSTEE DEALINGS WITH THE ISSUERS.
The Trustee under the Indenture, in its individual or any other capacity,
may become the owner or pledgee of Senior Notes, make loans to, accept deposits
from, and perform services for the Issuers, any Guarantor or their Affiliates,
and may otherwise deal with the Issuers, any Guarantor or their Affiliates, as
if it were not the Trustee.
16. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, no past, present or future
director, officer, employee, partner, affiliate, beneficiary or stockholder, as
such, of the Issuers or any Guarantor shall have any liability for any
obligations of the Issuers or any Guarantor under the Senior Notes or the
Indenture or for any claim based on, in respect or by reason of, such
obligations or their creation. The Holder of this Senior Note by accepting this
Senior Note waives and releases all such liability. The waiver and release are
part of the consideration for the issuance of this Senior Note. Such waiver may
not be effective to waive liabilities under federal securities laws and it is
the view of the SEC that such waiver is against public policy.
17. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Senior Note and for defeasance of certain covenants in the
Indenture upon compliance by the Issuers with certain conditions set forth in
the Indenture.
18. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder of a Note or
an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (joint tenants with right of survivorship and not as tenants
in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
19. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuers have caused CUSIP numbers to be
printed on the Senior Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of the Senior Notes. No
representation is made as to the accuracy of such numbers either as printed on
the Senior Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
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20. GOVERNING LAW.
THE INDENTURE AND THE SENIOR NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. EACH OF THE PARTIES HERETO
AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK OVER
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR
THE SENIOR NOTES.
THE ISSUERS WILL FURNISH TO ANY HOLDER OF A SENIOR NOTE UPON WRITTEN
REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:
SUPERIOR ESSEX COMMUNICATIONS LLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, ATTENTION: SECRETARY (OR SUCH OTHER ADDRESS AS THE
ISSUERS MAY DESIGNATE FROM TIME TO TIME FOR SUCH PURPOSE IN WRITTEN NOTICE TO
THE HOLDERS OF SENIOR NOTES).
21. AUTHENTICATION.
This Senior Note shall not be valid until the Trustee manually signs the
Certificate of Authentication on the other side of this Senior Note.
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ASSIGNMENT FORM(1)
I or we assign and transfer this Senior Note to:
(Insert assignee's social security or tax I.D. number)
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(Print or type name, address and zip code of assignee) and irrevocably appoint:
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Agent to transfer this Senior Note on the books of the Issuers. The Agent
may substitute another to act for him.
Date:
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Your Signature:
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(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:
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(1) THIS ASSIGNMENT FORM SHOULD BE INCLUDED ONLY IF THE NOTE IS IN DEFINITIVE
FORM.
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Senior Note
purchased by the Issuers pursuant to Section 4.6 of the Indenture, check the
box:
|_|
If you want to have only part of the Senior Note purchased by the Issuers
pursuant to Section 4.6 of the Indenture, state the amount you elect to have
purchased: $______ (multiple of $1,000)
Date: .
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Your Signature:
--------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guaranteed
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(1)
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:
Amount of Principal Amount
decrease in Amount of increase of this Global Note Signature of
Principal in Principal following such authorized officer
Amount Amount of this decrease (or of Trustee or Note
Date of Exchange of this Global Note Global Note increase) Custodian
---------------- ------------------- ----------- --------- ---------
(1) THIS SCHEDULE SHOULD BE INCLUDED ONLY IF THE NOTE IS IN GLOBAL FORM.
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EXHIBIT B
FORM OF GLOBAL NOTE LEGEND
Any Global Note authenticated and delivered hereunder shall bear a legend
(which would be in addition to any other legends required in the case of a
Restricted Security) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY IN CUSTODY FOR THE BENEFICIAL OWNERS HEREOF. THIS NOTE
IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION) ("DTC") TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
THIS SUPPLEMENTAL INDENTURE, dated as of ________, between
_________________ (the "Guarantor"), a subsidiary of [Superior Essex
Communications LLC, a Delaware limited liability company/Essex Group, Inc., a
Delaware corporation], and The Bank of New York, as trustee under the Indenture
as defined below (the "Trustee").
W I T N E S S E T H
WHEREAS, Superior Essex Communications LLC (the "Company") and Essex
Group, Inc. (the "Co-Obligor" and, together with the Company, the "Issuers") and
the Guarantors as listed on Schedule 1 to the Indenture, have heretofore
executed and delivered to the Trustee an indenture (the "Indenture"), dated as
of November o, 2003, providing for the issuance of up to an aggregate principal
amount of $145,000,000 (excluding Secondary Senior Notes) of Second Priority
Secured Notes due 2008 (the "Senior Notes");
WHEREAS, Section 4.24 of the Indenture provides that under certain
circumstances the Issuers are required to cause the Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the Guarantor
shall unconditionally guarantee all of the Issuers' Obligations under the Senior
Notes pursuant to a Guarantee on the terms and conditions set forth herein; and
WHEREAS, pursuant to Section 8.1 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFOR, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Senior Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guarantor hereby agrees, jointly and
severally with all other Guarantors, to guarantee the Issuers' obligations under
the Senior Notes on the terms and subject to the conditions set forth in Article
11 of the Indenture and to be bound by all other applicable provisions of the
Indenture.
3. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, partner, affiliate, beneficiary or stockholder of the
Guarantor, as such, shall have any liability for any obligations of the Issuers
or any Guarantor under the Senior Notes, any Guarantees, the Indenture or this
Supplemental Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of the Senior Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Senior Notes. Such waiver or
release may not be effective to
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waive or release liabilities under the federal securities laws and it is the
view of the SEC that such waiver is against public policy.
4. NEW YORK LAW TO GOVERN. The laws of the State of New York shall govern
and be used to construe this Supplemental Indenture.
5. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
6. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
7. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guarantor and the Issuers.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated:____________, ____
[Guarantor]
By:
-------------------------------
Name:
Title:
The Bank of New York, as Trustee
By:
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Name:
Title:
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