Exhibit 4.1
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NORCRAFT COMPANIES, L.P.
and
NORCRAFT FINANCE CORP.
as Issuers,
the GUARANTORS named herein,
as Guarantors,
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
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INDENTURE
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Dated as of October 21, 2003
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9% Senior Subordinated Notes due 2011
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CROSS-REFERENCE TABLE
Trust Indenture Act Indenture
Section Section
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310 (a)(1)................................................. 7.10
(a)(2)................................................. 7.10
(a)(3)................................................. N.A.
(a)(4)................................................. N.A.
(a)(5)................................................. 7.08; 7.10
(b).................................................... 7.08; 7.10; 12.02
(c).................................................... N.A.
311 (a).................................................... 7.11
(b).................................................... 7.11
(c).................................................... N.A.
312 (a).................................................... 2.05
(b).................................................... 12.03
(c).................................................... 12.03
313 (a).................................................... 7.06
(b)(1)................................................. 7.06
(b)(2)................................................. 7.06
(c).................................................... 7.06; 12.02
(d).................................................... 7.06
314 (a).................................................... 4.09; 4.19; 12.02
(b).................................................... N.A.
(c)(1)................................................. 7.02; 12.04; 12.05
(c)(2)................................................. 7.02; 12.04; 12.05
(c)(3)................................................. N.A.
(d).................................................... N.A.
(e).................................................... 12.05
(f).................................................... N.A.
315 (a).................................................... 7.01(b)
(b).................................................... 7.05
(c).................................................... 7.01
(d).................................................... 6.05; 7.01(c)
(e).................................................... 6.11
316 (a)(last sentence)..................................... 2.09
(a)(1)(A).............................................. 6.02
(a)(1)(B).............................................. 6.04
(a)(2)................................................. 9.02
(b).................................................... 6.07
(c).................................................... 9.05
317 (a)(1)................................................. 6.08
(a)(2)................................................. 6.09
(b).................................................... 2.04
318 (a).................................................... 12.01
(c).................................................... 12.01
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N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
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ARTICLE One
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.....................................................1
SECTION 1.02. Other Definitions..............................................30
SECTION 1.03. Incorporation by Reference of Trust Indenture Act..............31
SECTION 1.04. Rules of Construction..........................................32
ARTICLE Two
THE NOTES
SECTION 2.01. Form and Dating................................................32
SECTION 2.02. Execution, Authentication and Denomination.....................33
SECTION 2.03. Registrar and Paying Agent.....................................34
SECTION 2.04. Paying Agent To Hold Assets in Trust...........................35
SECTION 2.05. Holder Lists...................................................35
SECTION 2.06. Transfer and Exchange..........................................35
SECTION 2.07. Replacement Notes..............................................36
SECTION 2.08. Outstanding Notes..............................................36
SECTION 2.09. Treasury Notes.................................................36
SECTION 2.10. Temporary Notes................................................37
SECTION 2.11. Cancellation...................................................37
SECTION 2.12. Defaulted Interest.............................................37
SECTION 2.13. CUSIP Number...................................................38
SECTION 2.14. Deposit of Moneys..............................................38
SECTION 2.15. Book-Entry Provisions for Global Notes.........................38
SECTION 2.16. Special Transfer Provisions....................................39
ARTICLE Three
REDEMPTION
SECTION 3.01. Notices to Trustee.............................................43
SECTION 3.02. Selection of Notes To Be Redeemed..............................43
SECTION 3.03. Notice of Redemption...........................................43
SECTION 3.04. Effect of Notice of Redemption.................................44
SECTION 3.05. Deposit of Redemption Price....................................45
SECTION 3.06. Notes Redeemed in Part.........................................45
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ARTICLE Four
COVENANTS
SECTION 4.01. Payment of Notes...............................................45
SECTION 4.02. Maintenance of Office or Agency................................45
SECTION 4.03. Corporate Existence............................................46
SECTION 4.04. Payment of Taxes and Other Claims..............................46
SECTION 4.05. Maintenance of Properties and Insurance........................46
SECTION 4.06. Compliance Certificate; Notice of Default......................47
SECTION 4.07. Compliance with Laws...........................................47
SECTION 4.08. Waiver of Stay, Extension or Usury Laws........................48
SECTION 4.09. Change of Control..............................................48
SECTION 4.10. Limitations on Additional Indebtedness.........................50
SECTION 4.11. Limitations on Restricted Payments.............................52
SECTION 4.12. Limitations on Liens...........................................55
SECTION 4.13. Limitations on Asset Sales.....................................55
SECTION 4.14. Limitations on Transactions with Affiliates....................59
SECTION 4.15. Limitations on Dividend and Other Restrictions
Affecting Subsidiaries......................................61
SECTION 4.16. Additional Note Guarantees.....................................62
SECTION 4.17. No Senior Subordinated Debt....................................63
SECTION 4.18. Reports to Holders.............................................63
SECTION 4.19. Limitations on Designation of Unrestricted Subsidiaries........64
SECTION 4.20. Limitations on Sale and Leaseback Transactions.................65
SECTION 4.21. Limitation on Issuances or Sale of
Equity Interests of Restricted Subsidiaries.................66
SECTION 4.22. Business Activities............................................66
SECTION 4.23. Payments for Consent...........................................66
SECTION 4.24. Limitation on Activities of the Co-Issuer......................66
ARTICLE Five
SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidations, Etc...................................67
ARTICLE Six
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default..............................................69
SECTION 6.02. Acceleration...................................................71
SECTION 6.03. Other Remedies.................................................72
SECTION 6.04. Waiver of Past Defaults........................................72
SECTION 6.05. Control by Majority............................................72
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SECTION 6.06. Limitation on Suits............................................73
SECTION 6.07. Rights of Holders To Receive Payment...........................73
SECTION 6.08. Collection Suit by Trustee.....................................73
SECTION 6.09. Trustee May File Proofs of Claim...............................74
SECTION 6.10. Priorities.....................................................74
SECTION 6.11. Undertaking for Costs..........................................74
ARTICLE Seven
TRUSTEE
SECTION 7.01. Duties of Trustee..............................................75
SECTION 7.02. Rights of Trustee..............................................76
SECTION 7.03. Individual Rights of Trustee...................................77
SECTION 7.04. Trustee's Disclaimer...........................................77
SECTION 7.05. Notice of Default..............................................78
SECTION 7.06. Reports by Trustee to Holders..................................78
SECTION 7.07. Compensation and Indemnity.....................................78
SECTION 7.08. Replacement of Trustee.........................................79
SECTION 7.09. Successor Trustee by Merger, Etc...............................80
SECTION 7.10. Eligibility; Disqualification..................................80
SECTION 7.11. Preferential Collection of Claims Against the Issuers..........81
ARTICLE Eight
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of the Issuers' Obligations........................81
SECTION 8.02. Legal Defeasance and Covenant Defeasance.......................82
SECTION 8.03. Conditions to Legal Defeasance or Covenant Defeasance..........83
SECTION 8.04. Application of Trust Money.....................................85
SECTION 8.05. Repayment to the Issuers.......................................85
SECTION 8.06. Reinstatement..................................................85
ARTICLE Nine
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.....................................86
SECTION 9.02. With Consent of Holders........................................86
SECTION 9.03. Effect on Senior Debt..........................................88
SECTION 9.04. Compliance with the Trust Indenture Act........................88
SECTION 9.05. Revocation and Effect of Consents..............................88
SECTION 9.06. Notation on or Exchange of Notes...............................89
SECTION 9.07. Trustee To Sign Amendments, Etc................................89
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ARTICLE Ten
SUBORDINATION OF NOTES
SECTION 10.01. Notes Subordinated to Senior Debt..............................89
SECTION 10.02. Suspension of Payment When Senior Debt Is in Default...........90
SECTION 10.03. Notes Subordinated to Prior Payment of All Senior Debt
on Dissolution, Liquidation or Reorganization of
the Issuer or the Co-Issuer.................................91
SECTION 10.04. Payments May Be Made Prior to Dissolution......................92
SECTION 10.05. Holders To Be Subrogated to Rights of Holders of
Senior Debt.................................................93
SECTION 10.06. Obligations of the Issuers Unconditional.......................93
SECTION 10.07. Notice to Trustee..............................................93
SECTION 10.08. Reliance on Judicial Order or Certificate of
Liquidating Agent...........................................94
SECTION 10.09. Trustee's Relation to Senior Debt..............................94
SECTION 10.10. Subordination Rights Not Impaired by Acts or
Omissions of the Issuers or Holders of Senior Debt..........95
SECTION 10.11. Holders Authorize Trustee To Effectuate Subordination
of Notes....................................................95
SECTION 10.12. This Article Ten Not To Prevent Events of Default..............96
SECTION 10.13. Trustee's Compensation Not Prejudiced..........................96
ARTICLE Eleven
NOTE GUARANTEE
SECTION 11.01. Unconditional Guarantee........................................96
SECTION 11.02. Subordination of Note Guarantee................................97
SECTION 11.03. Limitation on Guarantor Liability..............................97
SECTION 11.04. Execution and Delivery of Note Guarantee.......................98
SECTION 11.05. Release of a Guarantor.........................................98
SECTION 11.06. Waiver of Subrogation..........................................99
SECTION 11.07. Immediate Payment.............................................100
SECTION 11.08. No Set-Off....................................................100
SECTION 11.09. Guarantee Obligations Absolute................................100
SECTION 11.10. Guarantee Obligations Continuing..............................100
SECTION 11.11. Guarantee Obligations Not Reduced.............................100
SECTION 11.12. Guarantee Obligations Reinstated..............................101
SECTION 11.13. Guarantee Obligations Not Affected............................101
SECTION 11.14. Waiver........................................................102
SECTION 11.15. No Obligation To Take Action Against the Issuers..............102
SECTION 11.16. Dealing with the Issuers and Others...........................102
SECTION 11.17. Default and Enforcement.......................................103
SECTION 11.18. Amendment, Etc................................................103
SECTION 11.19. Acknowledgment................................................103
SECTION 11.20. Costs and Expenses............................................103
SECTION 11.21. No Merger or Waiver; Cumulative Remedies......................104
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SECTION 11.22. Survival of Guarantee Obligations.............................104
SECTION 11.23. Guarantee in Addition to Other Guarantee Obligations..........104
SECTION 11.24. Severability..................................................104
SECTION 11.25. Successors and Assigns........................................104
ARTICLE Twelve
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls..................................105
SECTION 12.02. Notices.......................................................105
SECTION 12.03. Communications by Holders with Other Holders..................106
SECTION 12.04. Certificate and Opinion as to Conditions Precedent............106
SECTION 12.05. Statements Required in Certificate or Opinion.................106
SECTION 12.06. Rules by Trustee, Paying Agent, Registrar.....................107
SECTION 12.07. Legal Holidays................................................107
SECTION 12.08. Governing Law.................................................107
SECTION 12.09. No Adverse Interpretation of Other Agreements.................107
SECTION 12.10. No Recourse Against Others....................................107
SECTION 12.11. Successors....................................................108
SECTION 12.12. Duplicate Originals...........................................108
SECTION 12.13. Severability..................................................108
Signatures...................................................................S-1
Exhibit A - Form of Note
Exhibit B - Form of Legends
Exhibit C - Form of Certificate To Be Delivered in Connection with Transfers
to Non-QIB Accredited Investors
Exhibit D - Form of Certificate To Be Delivered in Connection with Transfers
Pursuant to Regulation S
Exhibit E - Form of Certificate To Be Delivered in Connection with Transfers
of Temporary Regulation S Global Note
Exhibit F - Form of Notation of Subsidiary Guarantee
Note: This Table of Contents shall not, for any purpose, be deemed to be part of
the Indenture.
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INDENTURE dated as of October 21, 2003 among NORCRAFT COMPANIES, L.P.,
a Delaware limited partnership (the "Issuer"), NORCRAFT FINANCE CORP., a
Delaware corporation (the "Co-Issuer" and, together with the Issuer, the
"Issuers"), and each of the Guarantors named herein, as Guarantors, and U.S.
BANK NATIONAL ASSOCIATION, a national banking association organized under the
laws of the United States of America, as Trustee (the "Trustee").
The Issuers have duly authorized the creation of an issue of 9% Senior
Subordinated Notes due 2011 and, to provide therefor, the Issuers have duly
authorized the execution and delivery of this Indenture. All things necessary to
make the Notes, when duly issued and executed by the Issuers and authenticated
and delivered hereunder, the valid and binding obligations of the Issuers and to
make this Indenture a valid and binding agreement of the Issuers have been done.
Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Notes:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
Set forth below are certain defined terms used in this Indenture.
"Acquired Indebtedness" means (1) with respect to any Person that
becomes a Restricted Subsidiary after the Issue Date, Indebtedness of such
Person and its Subsidiaries existing at the time such Person becomes a
Restricted Subsidiary and (2) with respect to the Issuer or any Restricted
Subsidiary, any Indebtedness of a Person (other than the Issuer or a Restricted
Subsidiary) existing at the time such Person is merged with or into the Issuer
or a Restricted Subsidiary, or Indebtedness expressly assumed by the Issuer or
any Restricted Subsidiary in connection with the acquisition of an asset or
assets from another Person.
"Additional Interest" has the meaning set forth in the Registration
Rights Agreement.
"Affiliate" of any Person means any other Person which directly or
indirectly controls or is controlled by, or is under direct or indirect common
control with, the referent Person. For purposes of Section 4.14, Affiliates
shall be deemed to include, with respect to any Person, any other Person (1)
which beneficially owns or holds, directly or indirectly, 10% or more of any
class of the Voting Stock of the referent Person, (2) of which 10% or more of
the Voting Stock is beneficially owned or held, directly or indirectly, by the
referenced Person or (3) with respect to an individual, any immediate family
member of such Person. For purposes of this definition and the definition of
"Control Investment Affiliate," "control" of a Person shall mean the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar or Paying Agent.
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"amend" means to amend, supplement, restate, amend and restate or
otherwise modify; and "amendment" shall have a correlative meaning.
"Applicable Premium" means, with respect to any Note on any Change of
Control Redemption Date, the greater of (i) 1.0% of the principal amount of such
Note and (ii) the excess of (A) the present value at such Change of Control
Redemption Date of (1) the redemption price of such Note at November 1, 2007,
plus (2) all scheduled interest payments due on such note from the Change of
Control Redemption Date through November 1, 2007, computed using a discount rate
equal to the Treasury Rate at such Change of Control Redemption Date, plus 50
basis points over (B) the principal amount of such Note.
"asset" means any asset or property.
"Asset Acquisition" means
(1) an Investment by the Issuer or any Restricted Subsidiary of the
Issuer in any other Person if, as a result of such Investment, such Person
shall become a Restricted Subsidiary of the Issuer, or shall be merged with
or into the Issuer or any Restricted Subsidiary of the Issuer, or
(2) the acquisition by the Issuer or any Restricted Subsidiary of the
Issuer of all or substantially all of the assets of any other Person or any
division or line of business of any other Person.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease,
assignment or other disposition by the Issuer or any Restricted Subsidiary to
any Person other than the Issuer or any Restricted Subsidiary (including by
means of a Sale and Leaseback Transaction or a merger or consolidation)
(collectively, for purposes of this definition, a "transfer"), in one
transaction or a series of related transactions, of any assets of the Issuer or
any of its Restricted Subsidiaries other than in the ordinary course of
business. For purposes of this definition, the term "Asset Sale" shall not
include:
(1) transfers of cash or Cash Equivalents;
(2) transfers of assets (including Equity Interests) that are governed
by, and made in accordance with Section 5.01;
(3) Permitted Investments and Restricted Payments permitted under
Section 4.11;
(4) the creation or realization of any Permitted Lien;
(5) transfers of damaged, worn-out or obsolete equipment or assets
that, in the Issuer's reasonable judgment, are no longer used or useful in
the business of the Issuer or its Restricted Subsidiaries; and
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(6) any transfer or series of related transfers that, but for this
clause, would be Asset Sales, if after giving effect to such transfers, the
aggregate Fair Market Value of the assets transferred in such transaction
or any such series of related transactions does not exceed $2.0 million.
"Attributable Indebtedness," when used with respect to any Sale and
Leaseback Transaction, means, as at the time of determination, the present value
(discounted at a rate equivalent to the Issuer's then-current weighted average
cost of funds for borrowed money as at the time of determination, compounded on
a semi-annual basis) of the total obligations of the lessee for rental payments
during the remaining term of the lease included in any such Sale and Leaseback
Transaction.
"Bankruptcy Law" means Title 11 of the United States Code, as amended,
or any similar federal, foreign or state law for the relief of debtors.
"Board of Directors" shall mean, with respect to any Person, (i) in
the case of any corporation, the board of directors of such Person, (ii) in the
case of any limited liability company, the board of managers of such Person,
(iii) in the case of any partnership, the Board of Directors of the general
partner of such Person and (iv) in any other case, the functional equivalent of
the foregoing.
"Business Day" means a day other than a Saturday, Sunday or other day
on which banking institutions in New York are authorized or required by law to
close.
"Capitalized Lease" means a lease required to be capitalized for
financial reporting purposes in accordance with GAAP.
"Capitalized Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under a Capitalized Lease, and the
amount of such obligation shall be the capitalized amount thereof determined in
accordance with GAAP.
"Cash Equivalents" means:
(1) obligations with a maturity of 360 days or less issued or directly
and fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and credit
of the United States of America is pledged in support thereof);
(2) demand and time deposits and certificates of deposit or
acceptances with a maturity of 360 days or less of any financial
institution that is a member of the Federal Reserve System having combined
capital and surplus and undivided profits of not less than $500 million and
is assigned at least a "B" rating by Thomson Financial Bank-Watch;
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(3) commercial paper maturing no more than 180 days from the date of
creation thereof issued by a corporation that is not the Issuer or an
Affiliate of the Issuer, and is organized under the laws of any State of
the United States of America or the District of Columbia and rated at least
A-1 by S&P or at least P-1 by Moody's;
(4) repurchase obligations with a term of not more than ten days for
underlying securities of the types described in clause (1) above entered
into with any commercial bank meeting the specifications of clause (2)
above; and
(5) investments in money market or other mutual funds substantially
all of whose assets comprise securities of the types described in clauses
(1) through (4) above.
"Change of Control" means the occurrence of any of the following
events:
(1) prior to a Public Equity Offering after the Issue Date, the
Permitted Holders cease to own, or to have the power to vote or direct the
voting of, directly or indirectly, Voting Stock representing more than 50%
of the voting power of the total outstanding Voting Stock of the Issuer;
(2) following a Public Equity Offering after the Issue Date, any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act, except that in no event shall the parties to the LP
Agreement be deemed a "group" solely by virtue of being parties to the LP
Agreement), other than one or more Permitted Holders, is or becomes the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, except that for purposes of this clause that person or group shall be
deemed to have "beneficial ownership" of all securities that any such
person or group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of
Voting Stock representing 50% or more of the voting power of the total
outstanding Voting Stock of the Issuer;
(3) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors (together with
any new directors whose election to such Board of Directors or nomination
for election was approved by one or more Permitted Holders prior to a
Public Equity Offering or whose election to such Board of Directors or
whose nomination for election was approved by a majority of the voting
power of the members of the Board of Directors of the Issuer, which members
comprising such majority are then still in office and were either directors
at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Issuer;
(4) (a) all or substantially all of the assets of the Issuer and the
Restricted Subsidiaries, taken as a whole, are sold or otherwise
transferred to any Person other than a Wholly-Owned Restricted Subsidiary
or one or more Permitted Holders or (b) Parent or the Issuer consolidates
or merges with or into another Person or any Person consolidates or merges
with or into Parent or the Issuer, in either case under this clause (4), in
one
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transaction or a series of related transactions in which immediately after
the consummation thereof Persons owning, directly or indirectly, Voting
Stock representing in the aggregate a majority of the total voting power of
the Voting Stock of the Issuer immediately prior to such consummation do
not own, directly or indirectly, Voting Stock representing a majority of
the total voting power of the Voting Stock of the Issuer or the surviving
or transferee Person; or
(5) the Issuer shall adopt a plan of liquidation or dissolution or any
such plan shall be approved by its equityholders.
"Consolidated Amortization Expense" for any period means the
amortization expense of the Issuer and the Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP, including,
without limitation, the amortization of capitalized store displays.
"Consolidated Cash Flow" for any period means, without duplication,
the sum of the amounts for such period of
(1) Consolidated Net Income, plus
(2) in each case only to the extent (and in the same proportion)
deducted in determining Consolidated Net Income and with respect to the
portion of Consolidated Net Income attributable to any Restricted
Subsidiary only if a corresponding amount would be permitted at the date of
determination to be distributed to the Issuer by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms
of its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders,
(a) Consolidated Income Tax Expense and, without duplication,
Permitted Tax Distributions,
(b) Consolidated Amortization Expense (but only to the extent not
included in Consolidated Interest Expense),
(c) Consolidated Depreciation Expense,
(d) Consolidated Interest Expense,
(e) all other non-cash items reducing Consolidated Net Income
(including without limitation non-cash write-offs of goodwill,
intangibles and long-lived assets, but excluding any non-cash charge
that results in an accrual of a reserve for cash charges in any future
period) for such period, and
(f) costs and expenses incurred in connection with the
Transactions and the Exchange Offer pursuant to the Registration
Rights Agreement (including
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without limitation amortization of debt issuance costs, debt discount
or premium and other financing fees and expenses directly relating),
in each case determined on a consolidated basis in accordance with GAAP,
minus
(3) the aggregate amount of all non-cash items, determined on a
consolidated basis, to the extent such items increased Consolidated Net
Income (other than the accrual of revenue, recording of receivables or the
reversal of reserves in the ordinary course of business) for such period.
"Consolidated Depreciation Expense" for any period means the
depreciation expense of the Issuer and the Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP.
"Consolidated Income Tax Expense" for any period means the provision
for taxes of the Issuer and the Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Interest Coverage Ratio" means the ratio of Consolidated
Cash Flow during the most recent four consecutive full fiscal quarters for which
financial statements are available (the "Four-Quarter Period") ending on or
prior to the date of the transaction giving rise to the need to calculate the
Consolidated Interest Coverage Ratio (the "Transaction Date") to Consolidated
Interest Expense for the Four-Quarter Period. For purposes of this definition,
Consolidated Cash Flow and Consolidated Interest Expense shall be calculated
after giving effect on a pro forma basis for the period of such calculation to:
(1) the incurrence of any Indebtedness or the issuance of any
Preferred Stock of the Issuer or any Restricted Subsidiary (and the
application of the proceeds thereof) and any repayment of other
Indebtedness or redemption of other Preferred Stock (and the application of
the proceeds therefrom) (other than the incurrence or repayment of
Indebtedness in the ordinary course of business for working capital
purposes pursuant to any revolving credit arrangement) occurring during the
Four-Quarter Period or at any time subsequent to the last day of the
Four-Quarter Period and on or prior to the Transaction Date, as if such
incurrence, repayment, issuance or redemption, as the case may be (and the
application of the proceeds thereof), occurred on the first day of the
Four-Quarter Period; and
(2) any Asset Sale or Asset Acquisition (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of the Issuer or any Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of
such Asset Acquisition) incurring Acquired Indebtedness and also including
any Consolidated Cash Flow (including any pro forma expense and cost
reductions calculated on a basis consistent with Regulation S-X under the
Exchange Act) associated with any such Asset Acquisition occurring during
the Four-Quarter Period or at any time subsequent to the last day of the
Four-Quarter Period and on or prior to the Transaction Date,
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as if such Asset Sale or Asset Acquisition (including the incurrence of, or
assumption or liability for, any such Indebtedness or Acquired
Indebtedness) occurred on the first day of the Four-Quarter Period.
If the Issuer or any Restricted Subsidiary directly or indirectly
guarantees Indebtedness of a third Person, the preceding sentence shall give
effect to the incurrence of such guaranteed Indebtedness as if the Issuer or
such Restricted Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
For purposes of calculating the Consolidated Interest Coverage Ratio
prior to the expiration of the first Four-Quarter Period subsequent to the Issue
Date, such calculation shall be on the same pro forma basis as the pro forma
financial statements that are presented in the Offering Memorandum.
In calculating Consolidated Interest Expense for purposes of
determining the denominator (but not the numerator) of this Consolidated
Interest Coverage Ratio:
(1) 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 this Indebtedness in effect on the
Transaction Date;
(2) if interest on any 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;
and
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is covered
by agreements relating to Hedging Obligations, shall be deemed to accrue at
the rate per annum resulting after giving effect to the operation of these
agreements.
"Consolidated Interest Expense" for any period means the sum, without
duplication, of the total interest expense of the Issuer and the Restricted
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP and including without duplication,
(1) imputed interest on Capitalized Lease Obligations and Attributable
Indebtedness,
(2) commission, discounts and other fees and charges owed with respect
to letters of credit securing financial obligations, bankers' acceptance
financing and receivables financings,
-8-
(3) amortization of debt issuance costs, debt discount or premium and
other financing fees and expenses,
(4) the interest portion of any deferred payment obligations,
(5) all other non-cash interest expense,
(6) capitalized interest,
(7) the product of (a) all dividend payments on any series of
Disqualified Equity Interests of the Issuer or any Preferred Stock of any
Restricted Subsidiary (other than any such Disqualified Equity Interests or
any Preferred Stock held by the Issuer or a Wholly-Owned Restricted
Subsidiary or to the extent paid in Qualified Equity Interests), multiplied
by (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 tax rate of the Issuer and the Restricted Subsidiaries, expressed
as a decimal,
(8) all interest payable with respect to discontinued operations, and
(9) all interest on any Indebtedness of any other Person guaranteed by
the Issuer or any Restricted Subsidiary;
provided that, to the extent directly related to the Transactions or the
Exchange Offer pursuant to the Registration Rights Agreement, amortization of
debt issuance costs, debt discount or premium and other financing fees and
expenses shall be excluded. Consolidated Interest Expense shall be calculated
after giving effect to Hedging Obligations (including associated costs)
described in clause (1) of the definition of "Hedging Obligations," but
excluding unrealized gains and losses with respect to Hedging Obligations.
"Consolidated Net Income" for any period means the net income (or
loss) of the Issuer and the Restricted Subsidiaries for such period determined
on a consolidated basis in accordance with GAAP; provided that there shall be
excluded from such net income (to the extent otherwise included therein),
without duplication:
(1) the net income (or loss) of any Person (other than a Restricted
Subsidiary) in which any Person other than the Issuer and the Restricted
Subsidiaries has an ownership interest, except to the extent that cash in
an amount equal to any such income has actually been received by the Issuer
or any of its Restricted Subsidiaries during such period;
(2) except to the extent includible in the consolidated net income of
the Issuer pursuant to the foregoing clause (1), the net income (or loss)
of any Person that accrued prior to the date that (a) such Person becomes a
Restricted Subsidiary or is merged into or consolidated with the Issuer or
any Restricted Subsidiary or (b) the assets of such Person are acquired by
the Issuer or any Restricted Subsidiary;
-9-
(3) the net income of any Restricted Subsidiary during such period to
the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of that income is not permitted
by operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary during such period, except that the Issuer's
equity in a net loss of any such Restricted Subsidiary for such period
shall be included in determining Consolidated Net Income;
(4) for the purposes of calculating the Restricted Payments Basket
only, in the case of a successor to the Issuer by consolidation, merger or
transfer of its assets, any income (or loss) of the successor prior to such
merger, consolidation or transfer of assets;
(5) other than for purposes of calculating the Restricted Payments
Basket, any gain (or loss), together with any related provisions for taxes
on any such gain (or the tax effect of any such loss), realized during such
period by the Issuer or any Restricted Subsidiary upon (a) the acquisition
of any securities, or the extinguishment of any Indebtedness, of the Issuer
or any Restricted Subsidiary or (b) any Asset Sale (without regard to the
$2.0 million limitation set forth in clause (6) of the definition thereof)
by the Issuer or any Restricted Subsidiary;
(6) gains and losses due solely to fluctuations in currency values and
the related tax effects according to GAAP;
(7) unrealized gains and losses with respect to Hedging Obligations;
and
(8) other than for purposes of calculating the Restricted Payments
Basket, any extraordinary or nonrecurring gain (or extraordinary or
nonrecurring loss), together with any related provision for taxes on any
such gain (or the tax effect of any such loss), realized by the Issuer or
any Restricted Subsidiary during such period.
In addition:
(a) Consolidated Net Income shall be reduced (to the extent not
already reduced thereby) by the amount of any payments to or on behalf of
Parent permitted by clause (5) or (6) of Section 4.11(b); and
(b) any return of capital with respect to an Investment that increased
the Restricted Payments Basket pursuant to Section 4.11(a)(3)(d) or
decreased the amount of Investments outstanding pursuant to clause (15) of
the definition of "Permitted Investments" shall be excluded from
Consolidated Net Income for purposes of calculating the Restricted Payments
Basket.
For purposes of this definition of "Consolidated Net Income," "nonrecurring"
means any gain or loss as of any date that is not reasonably likely to recur
within the two years following such
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date; provided that if there was a gain or loss similar to such gain or loss
within the two years preceding such date, such gain or loss shall not be deemed
nonrecurring.
"Control Investment Affiliate" means, as to any Person, any other
Person (a) which directly or indirectly is in control of, is controlled by, or
is under common control with, such Person and is organized by such Person (or
any Person controlling such Person) primarily for making equity or debt
investments in Parent, the Issuer or other portfolio companies or (b) as to
which such Person has the right to exercise the rights in all of the Voting
Stock held by such other Person, directly or indirectly, in the Issuer.
"Corporate Trust Office" means the corporate trust office of the
Trustee located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention:
Corporate Trust Administration, or such other office, designated by the Trustee
by written notice to the Issuers, at which at any particular time its corporate
trust business shall be administered.
"Credit Agreement" means the Credit Agreement dated on or about the
Issue Date by and among the Issuer, as Borrower, Parent, as guarantor, the other
guarantors named therein or from time to time party thereto, UBS AG, Stamford
Branch, as issuing bank, administrative agent and collateral agent, Wachovia
Bank, National Association, as syndication agent, UBS Securities LLC, as sole
book-manager and lead arranger, Wachovia Capital Markets, LLC, as co-arranger,
CIT Lending Services Corporation, as documentation agent, and the lenders named
therein or from time to time party thereto, including any notes, guarantees,
collateral and security documents, instruments and agreements executed in
connection therewith (including Hedging Obligations related to the Indebtedness
incurred thereunder), and in each case as amended or refinanced from time to
time.
"Credit Facilities" means one or more debt facilities (which may be
outstanding at the same time and including, without limitation, the Credit
Agreement) providing for revolving credit loans, term loans or letters of credit
and, in each case, as such agreements may be amended, amended and restated,
supplemented, modified, refinanced, replaced or otherwise restructured, in whole
or in part from time to time (including increasing the amount of available
borrowings thereunder or adding Restricted Subsidiaries as additional borrowers
or guarantors thereunder), with respect to all or any portion of the
Indebtedness under such agreement or agreements or any successor or replacement
agreement or agreements and whether by the same or any other agent, lender or
group of lenders.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"Default" means (1) any Event of Default or (2) any event, act or
condition that, after notice or the passage of time or both, would be an Event
of Default.
"Depository" shall mean The Depository Trust Company, New York, New
York, or a successor thereto registered under the Exchange Act or other
applicable statute or regulation.
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"Designated Senior Debt" means (1) Senior Debt and Guarantor Senior
Debt under or in respect of the Credit Facilities and (2) any other Indebtedness
constituting Senior Debt or Guarantor Senior Debt which, at the time of
determination, has an aggregate principal amount of at least $25.0 million and
is specifically designated in the instrument evidencing such Senior Debt or
Guarantor Senior Debt as "Designated Senior Debt."
"Disqualified Equity Interests" of any Person means any class of
Equity Interests of such Person that, by its terms, or by the terms of any
related agreement or of any security into which it is convertible, puttable or
exchangeable, is, or upon the happening of any event or the passage of time
would be, required to be redeemed by such Person, whether or not at the option
of the holder thereof, or matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, in whole or in part, on or prior to the
date which is 91 days after the final maturity date of the Notes; provided,
however, that any class of Equity Interests of such Person that, by its terms,
authorizes such Person to satisfy in full its obligations with respect to the
payment of dividends or upon maturity, redemption (pursuant to a sinking fund or
otherwise) or repurchase thereof or otherwise by the delivery of Equity
Interests that are not Disqualified Equity Interests, and that is not
convertible, puttable or exchangeable for Disqualified Equity Interests or
Indebtedness, will not be deemed to be Disqualified Equity Interests so long as
such Person satisfies its obligations with respect thereto solely by the
delivery of Equity Interests that are not Disqualified Equity Interests;
provided, further, however, that any Equity Interests that would not constitute
Disqualified Equity Interests but for provisions thereof giving holders thereof
(or the holders of any security into or for which such Equity Interests are
convertible, exchangeable or exercisable) the right to require the Issuer to
redeem such Equity Interests upon the occurrence of a change in control or asset
sale occurring prior to the final maturity date of the Notes shall not
constitute Disqualified Equity Interests if the change in control or asset sale
provisions applicable to such Equity Interests are no more favorable to such
holders than the provisions set forth in Section 4.09 and Section 4.13
respectively, and such Equity Interests specifically provide that the Issuer
will not redeem any such Equity Interests pursuant to such provisions prior to
the Issuer's purchase of the Notes as required pursuant to the provisions
described under Section 4.09 and Section 4.13 respectively.
"Equity Interests" of any Person means (1) any and all shares or other
equity interests (including common stock, preferred stock, limited liability
company interests and partnership interests) in such Person and (2) all rights
to purchase, warrants or options (whether or not currently exercisable),
participations or other equivalents of or interests in (however designated) such
shares or other interests in such Person.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as
amended.
"Exchange Notes" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
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"Fair Market Value" means, with respect to any asset, the price (after
taking into account any liabilities relating to such assets) that would be
negotiated in an arm's-length transaction for cash between a willing seller and
a willing and able buyer, neither of which is under any compulsion to complete
the transaction, as such price is determined in good faith by the Board of
Directors of the Issuer or a duly authorized committee thereof, as evidenced by
a resolution of such Board or committee.
"Foreign Subsidiary" means any Restricted Subsidiary of the Issuer
which (i) is not organized under the laws of (x) the United States or any state
thereof or (y) the District of Columbia and (ii) conducts substantially all of
its business operations outside the United States of America.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, as in effect on the Issue Date.
"General Partner" means Norcraft GP, L.L.C., a Delaware limited
liability company, or any successor sole general partner or managing general
partner of the Issuer.
"Global Note" shall mean one or more IAI Global Notes, Regulation S
Global Notes and 144A Global Notes.
"guarantee" means a direct or indirect guarantee by any Person of any
Indebtedness of any other Person and includes any obligation, direct or
indirect, contingent or otherwise, of such Person: (1) to purchase or pay (or
advance or supply funds for the purchase or payment of) Indebtedness of such
other Person (whether arising by virtue of partnership arrangements, or by
agreements to keep-well, to purchase assets, goods, securities or services
(unless such purchase arrangements are on arm's-length terms and are entered
into in the ordinary course of business), to take-or-pay, or to maintain
financial statement conditions or otherwise); or (2) entered into for purposes
of assuring in any other manner the oblige of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); "guarantee," when used as a verb, and "guaranteed" have correlative
meanings.
"Guarantor Senior Debt" means, with respect to the Co-Issuer and any
Guarantor, the principal of, premium, if any, and interest (including any
interest accruing subsequent to the filing of a petition of bankruptcy at the
rate provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on any Indebtedness of such
Guarantor, whether outstanding on the Issue Date or thereafter created, incurred
or assumed, unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such Indebtedness shall not be senior in right of
payment to the Notes.
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Without limiting the generality of the foregoing, "Guarantor Senior
Debt" shall also include the principal of, premium, if any, interest (including
any interest accruing subsequent to the filing of a petition of bankruptcy at
the rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) on, and all other
amounts owing in respect of:
(1) all monetary obligations of every nature of the Co-Issuer and any
Guarantor under, or with respect to, the Credit Facilities, including,
without limitation, obligations to pay principal and interest,
reimbursement obligations under letters of credit, fees, expenses and
indemnities (and guarantees thereof); and
(2) all Hedging Obligations in respect of the Credit Facilities;
in each case whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, "Guarantor Senior Debt" shall not
include:
(1) any Indebtedness of the Co-Issuer or such Guarantor to Parent or
any of its Subsidiaries;
(2) Indebtedness to, or guaranteed on behalf of, any director, officer
or employee of the Issuer or any of its other Subsidiaries (including,
without limitation, amounts owed for compensation);
(3) obligations to trade creditors and other amounts incurred (but not
under the Credit Facilities) in connection with obtaining goods, materials
or services;
(4) Indebtedness represented by Disqualified Equity Interests;
(5) any liability for taxes owed or owing by the Co-Issuer or such
Guarantor;
(6) that portion of any Indebtedness incurred in violation of Section
4.10 (but, as to any such obligation, no such violation shall be deemed to
exist for purposes of this clause (6) if the holder(s) of such obligation
or their representative shall have received an Officers' Certificate of the
Issuer to the effect that the incurrence of such Indebtedness does not (or,
in the case of revolving credit indebtedness, that the incurrence of the
entire committed amount thereof at the date on which the initial borrowing
thereunder is made would not) violate such provisions of this Indenture);
(7) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, is without
recourse to such Guarantor; and
(8) any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of the Co-Issuer or such
Guarantor.
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"Guarantors" means (1) Norcraft Canada Corporation and (2) each Person
that is required to, or at the election of the Issuers does, become a Guarantor
by the terms of this Indenture after the Issue Date, in each case, until such
Person is released from its Note Guarantee in accordance with the terms of this
Indenture.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to (1) any interest rate swap agreement, interest rate collar
agreement or other similar agreement or arrangement, (2) agreements or
arrangements relating to, or designed to protect such Person against,
fluctuations in foreign currency exchange rates, or (3) any forward contract,
commodity swap agreement, commodity option agreement or other similar agreement
or arrangement.
"Holder" means any registered holder, from time to time, of the Notes.
"IAI Global Note" means a permanent global security in the form of
Exhibit A hereto bearing the legends set forth in Exhibit B and deposited with
or on behalf of and registered in the name of the Depository or its nominee to
be issued in connection with the first transfer made pursuant to Section
2.16(a).
"incur" means, with respect to any Indebtedness or Obligation, incur,
create, issue, assume, guarantee or otherwise become directly or indirectly
liable, contingently or otherwise, with respect to such Indebtedness or
Obligation; provided that (1) the Indebtedness of a Person existing at the time
such Person became a Restricted Subsidiary shall be deemed to have been incurred
by such Restricted Subsidiary and (2) neither the accrual of interest nor the
accretion of original issue discount shall be deemed to be an incurrence of
Indebtedness.
"Indebtedness" of any Person at any date means, without duplication:
(1) all liabilities, contingent or otherwise, of such Person 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);
(2) all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments;
(3) all reimbursement obligations of such Person in respect of letters
of credit, letters of guaranty, bankers' acceptances and similar credit
transactions;
(4) all obligations of such Person to pay the deferred and unpaid
purchase price of property or services, except trade payables and accrued
expenses incurred by such Person in the ordinary course of business in
connection with obtaining goods, materials or services;
(5) the maximum fixed redemption or repurchase price of all
Disqualified Equity Interests of such Person;
-15-
(6) all Capitalized Lease Obligations of such Person;
(7) all Indebtedness of others secured by a Lien on any asset of such
Person, whether or not such Indebtedness is assumed by such Person;
(8) all Indebtedness of others guaranteed by such Person to the extent
of such guarantee; provided that Indebtedness of the Issuer or its
Subsidiaries that is guaranteed by the Issuer or the Issuer's Subsidiaries
shall only be counted once in the calculation of the amount of Indebtedness
of the Issuer and its Subsidiaries on a consolidated basis;
(9) all Attributable Indebtedness;
(10) to the extent not otherwise included in this definition, Hedging
Obligations of such Person; and
(11) all obligations of such Person under conditional sale or other
title retention agreements relating to assets purchased by such Person.
The amount of any Indebtedness which is incurred at a discount to the principal
amount at maturity thereof as of any date shall be deemed to have been incurred
at the accreted value thereof as of such date. 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, the maximum liability of such
Person for any such contingent obligations at such date and, in the case of
clause (7), the lesser of (a) the Fair Market Value of any asset subject to a
Lien securing the Indebtedness of others on the date that the Lien attaches and
(b) the amount of the Indebtedness secured. For purposes of clause (5), the
"maximum fixed redemption or repurchase price" of any Disqualified Equity
Interests that do not have a fixed redemption or repurchase price shall be
calculated in accordance with the terms of such Disqualified Equity Interests as
if such Disqualified Equity Interests were redeemed or repurchased on any date
on which an amount of Indebtedness outstanding shall be required to be
determined pursuant to this Indenture.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Independent Director" means, with respect to any transaction, a
director of the Issuer who is independent with respect to such transaction.
"Independent Financial Advisor" means an accounting, appraisal or
investment banking firm of nationally recognized standing that is, in the
reasonable judgment of the Issuer's Board of Directors, qualified to perform the
task for which it has been engaged and disinterested and independent with
respect to the Issuer and its Affiliates.
"Initial Purchasers" means UBS Securities LLC and Wachovia Capital
Markets, LLC.
-16-
"interest" means, with respect to the Notes, interest and Additional
Interest, if any, on the Notes.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Notes.
"Investments" of any Person means:
(1) all direct or indirect investments by such Person in any other
Person in the form of loans, advances or capital contributions or other
credit extensions constituting Indebtedness of such other Person, and any
guarantee of Indebtedness of any other Person;
(2) all purchases (or other acquisitions for consideration) by such
Person of Indebtedness, Equity Interests or other securities of any other
Person (other than any such purchase that constitutes a Restricted Payment
of the type described in clause (2) of the definition thereof);
(3) all other items that would be classified as investments (including
purchases of assets outside the ordinary course of business) on a balance
sheet of such Person prepared in accordance with GAAP; and
(4) the Designation of any Subsidiary as an Unrestricted Subsidiary.
Except as otherwise expressly specified in this definition, the amount of any
Investment (other than an Investment made in cash) shall be the Fair Market
Value thereof on the date such Investment is made. The amount of Investment
pursuant to clause (4) shall be the Designation Amount determined in accordance
with Section 4.19. If the Issuer or any Subsidiary sells or otherwise disposes
of any Equity Interests of any direct or indirect Subsidiary such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary, the Issuer shall be deemed to have made an Investment on the date of
any such sale or other disposition equal to the Fair Market Value of the Equity
Interests of and all other Investments in such Subsidiary not sold or disposed
of, which amount shall be determined by the Board of Directors. The acquisition
by the Issuer or any Restricted Subsidiary of a Person that holds an Investment
in a third Person shall be deemed to be an Investment by the Issuer or such
Restricted Subsidiary in the third Person in an amount equal to the Fair Market
Value of the Investment held by the acquired Person in the third Person.
Notwithstanding the foregoing, purchases or redemptions of Equity Interests of
the Issuer shall be deemed not to be Investments.
"Issue Date" means October 21, 2003.
"Lien" means, with respect to any asset, any mortgage, deed of trust,
lien (statutory or other), pledge, lease, easement, restriction, covenant,
charge, security interest or other encumbrance of any kind or nature in respect
of such asset, whether or not filed, recorded or otherwise perfected under
applicable law, including any conditional sale or other title retention
-17-
agreement, and any lease in the nature thereof, any option or other agreement to
sell, and any filing of, or agreement to give, any financing statement under the
Uniform Commercial Code (or equivalent statutes) of any jurisdiction (other than
cautionary filings in respect of operating leases).
"LP Agreement" means the limited partnership agreement relating to
Parent dated on or about the Issue Date that is described in the Offering
Memorandum under "Security Ownership of Certain Beneficial Owners and
Management."
"Management and Monitoring Agreement" means, collectively, the
management and monitoring agreements described in the Offering Memorandum under
"Certain Relationships and Related Transactions."
"Maturity Date" means November 1, 2011.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., and its successors.
"Net Available Proceeds" means, with respect to any Asset Sale, the
proceeds thereof in the form of cash or Cash Equivalents, net of
(1) brokerage commissions and other fees and expenses (including fees
and expenses of legal counsel, accountants and investment banks) of such
Asset Sale;
(2) provisions for taxes payable as a result of such Asset Sale (after
taking into account any available tax credits or deductions and any tax
sharing arrangements);
(3) amounts required to be paid to any Person (other than the Issuer
or any Restricted Subsidiary) owning a beneficial interest in the assets
subject to the Asset Sale or having a Lien thereon;
(4) payments of unassumed liabilities (not constituting Indebtedness)
relating to the assets sold at the time of, or within 30 days after the
date of, such Asset Sale; and
(5) appropriate amounts to be provided by the Issuer or any Restricted
Subsidiary, as the case may be, as a reserve required in accordance with
GAAP against any adjustment in the sale price of such asset or assets or
liabilities associated with such Asset Sale and retained by the Issuer or
any Restricted Subsidiary, as the case may be, after such Asset Sale,
including pensions and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale, all as
reflected in an Officers' Certificate delivered to the Trustee; provided,
however, that any amounts remaining after adjustments, revaluations or
liquidations of such reserves shall constitute Net Available Proceeds.
-18-
"Non-Recourse Debt" means Indebtedness of an Unrestricted Subsidiary:
(1) as to which neither the Issuer nor any Restricted Subsidiary (a)
provides credit support of any kind (including any undertaking, agreement
or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable as a guarantor or otherwise, or (c) constitutes the
lender;
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of
any other Indebtedness (other than the Notes) of the Issuer or any
Restricted Subsidiary to declare a default on the other Indebtedness or
cause the payment thereof to be accelerated or payable prior to its Stated
Maturity; and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the Equity Interests or assets of the Issuer
or any Restricted Subsidiary.
"Non-U.S. Person" has the meaning assigned to such term in Regulation
S.
"Note Guarantee" means the subordinated guarantee by each Guarantor of
the Issuers' payment obligations under this Indenture and the Notes, executed
pursuant to this Indenture.
"Notes" means, collectively, the Issuers' 9% Senior Subordinated Notes
due 2011 issued in accordance with Section 2.02 (whether on the Issue Date or
thereafter) treated as a single class of securities under this Indenture, as
amended or supplemented from time to time in accordance with the terms of this
Indenture.
"Obligation" means any principal, interest, penalties, fees,
indemnification, reimbursements, costs, expenses, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the offering memorandum of the Issuers
dated October 10, 2003 relating to the Notes.
"Officer" means any of the following of the Issuer: the Chairman of
the Board of Directors, the Chief Executive Officer, the Chief Financial
Officer, the President, any Vice President, the Treasurer or the Secretary. Any
Officer of the General Partner shall be deemed to be an Officer of the Issuer.
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Issuers, a Guarantor or the Trustee.
-19-
"Parent" means Norcraft Holdings, L.P., a Delaware limited
partnership, and its successors and assigns.
"Pari Passu Indebtedness" means any Indebtedness of the Issuer or any
Guarantor that ranks pari passu in right of payment with the Notes or the Note
Guarantees, as applicable.
"Permitted Business" means the businesses engaged in by the Issuer and
its Subsidiaries on the Issue Date as described in the Offering Memorandum and
businesses that are reasonably related thereto or reasonable extensions thereof.
"Permitted Holders" means (a) SKM Equity Fund III, L.P. and its
Control Investment Affiliates, (b) Trimaran Fund II, L.L.C. and its Control
Investment Affiliates, (c) ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ and his Related Parties and (d) for
so long as the Issuer shall be a limited partnership, the General Partner.
"Permitted Investments" means:
(1) Investments by the Issuer, the Co-Issuer or any Guarantor in (a)
any Guarantor or the Co-Issuer or (b) in any Person that is or will become
immediately after such Investment a Guarantor or that will merge or
consolidate into the Issuer, the Co-Issuer or a Guarantor;
(2) Investments in the Issuer by any Restricted Subsidiary;
(3) loans and advances to directors, employees and officers of the
Issuer and the Restricted Subsidiaries for bona fide business purposes and
to purchase Equity Interests of the Issuer not in excess of $2.0 million at
any one time outstanding;
(4) Hedging Obligations incurred pursuant to clause (4) of Section
4.10(b);
(5) cash and Cash Equivalents;
(6) receivables owing to the Issuer or any Restricted Subsidiary if
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; provided, however,
that such trade terms may include such concessionary trade terms as the
Issuer or any such Restricted Subsidiary deems reasonable under the
circumstances;
(7) Investments in securities of trade creditors or customers received
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers;
(8) Investments made by the Issuer or any Restricted Subsidiary as a
result of consideration received in connection with an Asset Sale made in
compliance with clauses (1) and (2) of Section 4.13(a);
-20-
(9) lease, utility and other similar deposits in the ordinary course
of business;
(10) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Issuer or any
Restricted Subsidiary or in satisfaction of judgments;
(11) Investments, to the extent the payment for which is made in
Qualified Equity Interests;
(12) Investments existing on the Issue Date;
(13) Investments represented by guarantees otherwise permitted to be
made by this Indenture;
(14) Investments in Restricted Subsidiaries that are not Guarantors in
an aggregate amount not to exceed $5.0 million at any one time outstanding
(with each Investment being valued as of the date made and without regard
to subsequent changes in value); and
(15) other Investments in an aggregate amount not to exceed $10.0
million at any one time outstanding (with each Investment being valued as
of the date made and without regard to subsequent changes in value).
The amount of Investments outstanding at any time pursuant to clause (15) above
shall be deemed to be reduced:
(a) upon the disposition or repayment of or return on any Investment
made pursuant to clause (15) above, by an amount equal to the return of
capital with respect to such Investment to the Issuer or any Restricted
Subsidiary (to the extent not included in the computation of Consolidated
Net Income), less the cost of the disposition of such Investment and net of
taxes; and
(b) upon a Redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary, by an amount equal to the lesser of (x) the Fair Market Value
of the Issuer's proportionate interest in such Subsidiary immediately
following such Redesignation; and (y) the aggregate amount of Investments
in such Subsidiary that increased (and did not previously decrease) the
amount of Investments outstanding pursuant to clause (15) above.
"Permitted Junior Securities" means:
(1) Equity Interests in the Issuer or any Guarantor; or
(2) debt securities that are subordinated to (a) all Senior Debt and
Guarantor Senior Debt and (b) any debt securities issued in exchange for
Senior Debt to substan-
-21-
tially the same extent as, or to a greater extent than, the Notes and the
Note Guarantees are subordinated to Senior Debt and Guarantor Senior Debt
under this Indenture.
"Permitted Liens" means the following types of Liens:
(1) Liens for taxes, assessments or governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Issuer or the Restricted Subsidiaries shall
have set aside on its books such reserves as may be required pursuant to
GAAP;
(2) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent or
being contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made in
respect thereof;
(3) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other
types of social security, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money);
(4) Liens upon specific items of inventory or other goods and proceeds
of any Person securing such Person's obligations in respect of bankers'
acceptances issued or created for the account of such Person to facilitate
the purchase, shipment or storage of such inventory or other goods;
(5) judgment Liens not giving rise to a Default so long as such Liens
are adequately bonded and any appropriate legal proceedings which may have
been duly initiated for the review of such judgment have not been finally
terminated or the period within which the proceedings may be initiated has
not expired;
(6) easements, rights-of-way, zoning restrictions and other similar
charges, restrictions or encumbrances in respect of real property or
immaterial imperfections of title which do not, in the aggregate, impair in
any material respect the ordinary conduct of the business of the Issuer and
the Restricted Subsidiaries taken as a whole;
(7) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other assets
relating to such letters of credit and products and proceeds thereof;
(8) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual or warranty requirements of the Issuer
or any Restricted Subsidiary, including rights of offset and setoff;
-22-
(9) bankers' Liens, rights of setoff and other similar Liens existing
solely with respect to cash and Cash Equivalents on deposit in one or more
of accounts maintained by the Issuer or any Restricted Subsidiary, in each
case granted in the ordinary course of business in favor of the bank or
banks with which such accounts are maintained, securing amounts owing to
such bank with respect to cash management and operating account
arrangements, including those involving pooled accounts and netting
arrangements; provided that in no case shall any such Liens secure (either
directly or indirectly) the repayment of any Indebtedness;
(10) leases or subleases granted to others that do not materially
interfere with the ordinary course of business of the Issuer or any
Restricted Subsidiary;
(11) Liens arising from filing Uniform Commercial Code financing
statements regarding leases;
(12) Liens securing all of the Notes and Liens securing any Note
Guarantee;
(13) Liens securing Senior Debt or Guarantor Senior Debt;
(14) Liens existing on the Issue Date securing Indebtedness
outstanding on the Issue Date;
(15) Liens in favor of the Issuer or a Guarantor;
(16) Liens securing Indebtedness under the Credit Facilities;
(17) Liens securing Purchase Money Indebtedness;
(18) Liens on assets of a Person existing at the time such Person is
acquired or merged with or into or consolidated with the Issuer or any such
Restricted Subsidiary (and not created in anticipation or contemplation
thereof);
(19) Liens to secure Refinancing Indebtedness of Indebtedness secured
by Liens referred to in the foregoing clauses (13), (14), (16) and (17);
provided that in the case of Liens securing Refinancing Indebtedness of
Indebtedness secured by Liens referred to in the foregoing clauses (14) and
(17) such Liens do not extend to any additional assets (other than
improvements thereon and replacements thereof);
(20) Liens to secure Attributable Indebtedness incurred pursuant to
Section 4.20; provided that any such Lien shall not extend to or cover any
assets of the Issuer or any Restricted Subsidiary other than the assets
which are the subject of the Sale and Leaseback Transaction in which the
Attributable Indebtedness is incurred;
(21) 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;
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(22) Liens securing Indebtedness granted by a Restricted Subsidiary
that is not a Guarantor; and
(23) Liens incurred in the ordinary course of business of the Issuer
or any Restricted Subsidiary with respect to obligations (other than
Indebtedness) that do not in the aggregate exceed $5.0 million at any one
time outstanding.
"Permitted Tax Distributions" means:
(1) in the event that the Issuer is treated as a corporation for
federal income tax purposes, payments, dividends or distributions to Parent
in order to pay consolidated or combined federal, state or local taxes to
the extent that such taxes are attributable to the income of the Issuer and
its Subsidiaries; or
(2) in the event that the Issuer is not treated as a corporation for
federal income tax purposes, payments, dividends or distributions to the
then or former equity holders of the Issuer in an amount equal to, with
respect to any taxable year of the Issuer, the product of (x) the highest
combined federal, state (or provincial) and local statutory tax rate (after
taking into account the deductibility of state (or provincial) and local
income tax for federal income tax purposes) applicable to any direct (or,
where the direct equity holder is a pass-through entity, indirect) equity
holder of the Issuer multiplied by (y) the taxable income of the Issuer and
its Subsidiaries determined on the basis that the Issuer is a partnership
for federal income tax purposes for such year; provided, however, that the
combined tax rate in clause (x) of this paragraph shall not exceed the
highest combined tax rate that shall be applicable to a direct (or, where
the direct equity holder is a pass-through entity, indirect) equity holder
of the Issuer residing only in the United States for tax purposes;
minus, in the case of clauses (1) and (2) of this definition, any federal, state
and local income taxes paid or payable by the Issuer and its Subsidiaries
directly to taxing authorities on behalf of their direct or indirect equity
holders in respect of the income tax liability of such equity holders, if any.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, incorporated or unincorporated association,
joint-stock company, trust, unincorporated organization or government or other
agency or political subdivision thereof or other entity of any kind.
"Plan of Liquidation" with respect to any Person means a plan that
provides for, contemplates or the effectuation of which is preceded or
accompanied by (whether or not substantially contemporaneously, in phases or
otherwise): (1) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of such Person otherwise than as an entirety or
substantially as an entirety; and (2) the distribution of all or substantially
all of the proceeds of such sale, lease, conveyance or other disposition of all
or substantially all of the assets of such Person to holders of Equity Interests
of such Person.
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"Preferred Stock" means, with respect to any Person, any and all
preferred or preference stock or other equity interests (however designated) of
such Person whether now outstanding or issued after the Issue Date.
"principal" means, with respect to the Notes, the principal of, and
premium, if any, on the Notes.
"Private Placement Legend" means the legends initially set forth on
the Notes in the form set forth in Exhibit B.
"Public Equity Offering" means an underwritten public offering of
Qualified Equity Interests of Parent generating gross proceeds of at least $50.0
million in the aggregate since the Issue Date, pursuant to an effective
registration statement filed under the Securities Act.
"Purchase Money Indebtedness" means Indebtedness, including
Capitalized Lease Obligations, of the Issuer or any Restricted Subsidiary
incurred for the purpose of financing all or any part of the purchase price of
property, plant or equipment used in the business of the Issuer or any
Restricted Subsidiary or the cost of installation, construction or improvement
thereof; provided, however, that (1) the amount of such Indebtedness shall not
exceed such purchase price or cost, (2) such Indebtedness shall not be secured
by any asset other than the specified asset being financed or, in the case of
real property or fixtures, including additions and improvements, the real
property to which such asset is attached and (3) such Indebtedness shall be
incurred within 180 days after such acquisition of such asset by the Issuer or
such Restricted Subsidiary or such installation, construction or improvement.
"Qualified Equity Interests" means Equity Interests of the Issuer
other than Disqualified Equity Interests; provided that such Equity Interests
shall not be deemed Qualified Equity Interests to the extent sold or owed to a
Subsidiary of the Issuer or financed, directly or indirectly, using funds (1)
borrowed from the Issuer or any Subsidiary of the Issuer until and to the extent
such borrowing is repaid or (2) contributed, extended, guaranteed or advanced by
the Issuer or any Subsidiary of the Issuer (including, without limitation, in
respect of any employee stock ownership or benefit plan).
"Qualified Equity Offering" means the issuance and sale of Qualified
Equity Interests of Parent to Persons; provided, however, that cash proceeds
therefrom equal to not less than 100% of the aggregate principal amount of any
Notes to be redeemed are received by the Issuer as a capital contribution
immediately prior to such redemption.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Record Date" means the applicable Record Date specified in the Notes;
provided that if any such date is not a Business Day, the Record Date shall be
the first day immediately preceding such specified day that is a Business Day.
-25-
"redeem" means to redeem, repurchase, purchase, defease, retire,
discharge or otherwise acquire or retire for value; and "redemption" shall have
a correlative meaning; provided that this definition shall not apply for
purposes of Section 5 or Section 6 of the Notes or Article III.
"Redemption Date," when used with respect to any Note to be redeemed,
means the date fixed for such redemption pursuant to this Indenture and the
Notes.
"Redemption Price," when used with respect to any Note to be redeemed,
means the price fixed for such redemption, payable in immediately available
funds, pursuant to this Indenture and the Notes.
"refinance" means to refinance, repay, prepay, replace, renew or
refund.
"Refinancing Indebtedness" means Indebtedness of the Issuer or a
Restricted Subsidiary issued in exchange for, or the proceeds from the issuance
and sale or disbursement of which are used substantially concurrently to redeem
or refinance in whole or in part, or constituting an amendment of, any
Indebtedness of the Issuer or any Restricted Subsidiary (the "Refinanced
Indebtedness") in a principal amount not in excess of the principal amount (plus
premium, if any) of the Refinanced Indebtedness so repaid or amended (or, if
such Refinancing Indebtedness refinances Indebtedness under a revolving credit
facility or other agreement providing a commitment for subsequent borrowings,
with a maximum commitment not to exceed the maximum commitment under such
revolving credit facility or other agreement); provided that:
(1) the Refinancing Indebtedness is the obligation of the same Person
as that of the Refinanced Indebtedness;
(2) if the Refinanced Indebtedness was subordinated to or pari passu
with the Notes or the Note Guarantees, as the case may be, then such
Refinancing Indebtedness, by its terms, is expressly pari passu with (in
the case of Refinanced Indebtedness that was pari passu with) or
subordinate in right of payment to (in the case of Refinanced Indebtedness
that was subordinated to) the Notes or the Note Guarantees, as the case may
be, at least to the same extent as the Refinanced Indebtedness;
(3) the Refinancing Indebtedness is scheduled to mature either (a) no
earlier than the Refinanced Indebtedness being repaid or amended or (b)
after the maturity date of the Notes;
(4) the portion, if any, of the Refinancing Indebtedness that is
scheduled to mature on or prior to the maturity date of the Notes 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 portion of the Refinanced Indebtedness being repaid that is
scheduled to mature on or prior to the maturity date of the Notes; and
-26-
(5) except for Refinancing Indebtedness in respect of the Credit
Facilities, the Refinancing Indebtedness is secured only to the extent, if
at all, and by the assets, that the Refinanced Indebtedness being repaid or
amended is secured.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of October 21, 2003 among the Issuers, Norcraft Canada
Corporation as guarantor and the Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Related Party" means any family member of ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ or any
trust, corporation, partnership or other entity, the beneficiaries,
stockholders, partners or owners of which are ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ and/or any members
of his family.
"Representative" means any agent or representative in respect of any
Designated Senior Debt; provided that if, and for so long as, any Designated
Senior Debt lacks such representative, then the Representative for such
Designated Senior Debt shall at all times constitute the holders of a majority
in outstanding principal amount of such Designated Senior Debt.
"Responsible Officer" means, when used with respect to the Trustee,
any officer in the Corporate Trust Office of the Trustee to whom any corporate
trust matter is referred because of such officer's knowledge of and familiarity
with the particular subject and shall also mean any officer who shall have
direct responsibility for the administration of this Indenture.
"Restricted Payment" means any of the following:
(1) the declaration or payment of any dividend or any other
distribution on Equity Interests of the Issuer or any Restricted Subsidiary
or any payment made to the direct or indirect holders (in their capacities
as such) of Equity Interests of the Issuer or any Restricted Subsidiary,
including, without limitation, any payment in connection with any merger or
consolidation involving the Issuer but excluding (a) dividends or
distributions payable solely in Qualified Equity Interests and (b) in the
case of Restricted Subsidiaries, dividends or distributions payable to the
Issuer or to a Restricted Subsidiary and pro rata dividends or
distributions payable to minority stockholders of any Restricted
Subsidiary;
(2) the redemption of any Equity Interests of the Issuer, any
Restricted Subsidiary, the General Partner or any equity holder of the
Issuer, including, without limitation, any payment in connection with any
merger or consolidation involving the Issuer but excluding any such Equity
Interests held by the Issuer or any Restricted Subsidiary;
(3) any Investment other than a Permitted Investment; or
(4) any redemption prior to the scheduled maturity or prior to any
scheduled repayment of principal or sinking fund payment, as the case may
be, in respect of Subordinated Indebtedness.
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"Restricted Security" means a Note that constitutes a "Restricted
Security" within the meaning of Rule 144(a)(3) under the Securities Act;
provided, however, that the Trustee shall be entitled to request and
conclusively rely on an Opinion of Counsel with respect to whether any Note
constitutes a Restricted Security.
"Restricted Subsidiary" means any Subsidiary of the Issuer other than
an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Service, a division of the
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors.
"Sale and Leaseback Transactions" means with respect to any Person an
arrangement with any bank, insurance company or other lender or investor or to
which such lender or investor is a party, providing for the leasing by such
Person of any asset of such Person which has been or is being sold or
transferred by such Person to such lender or investor or to any Person to whom
funds have been or are to be advanced by such lender or investor on the security
of such asset.
"SEC" means the U.S. Securities and Exchange Commission.
"Secretary's Certificate" means a certificate signed by the Secretary
of the Issuer.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on any
Indebtedness of the Issuer, whether outstanding on the Issue Date or thereafter
created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Notes.
Without limiting the generality of the foregoing, "Senior Debt" shall
include the principal of, premium, if any, interest (including any interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on, and all other amounts
owing in respect of:
(1) all monetary obligations of every nature under, or with respect
to, the Credit Facilities, including, without limitation, obligations to
pay principal and interest, reimbursement obligations under letters of
credit, fees, expenses and indemnities (and guarantees thereof); and
-28-
(2) all Hedging Obligations in respect of the Credit Facilities;
in each case whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, "Senior Debt" shall not include:
(1) any Indebtedness of the Issuer to Parent or any of its
Subsidiaries;
(2) Indebtedness to, or guaranteed on behalf of, any director, officer
or employee of Parent or any of its Subsidiaries (including, without
limitation, amounts owed for compensation);
(3) obligations to trade creditors and other amounts incurred (but not
under the Credit Facilities) in connection with obtaining goods, materials
or services;
(4) Indebtedness represented by Disqualified Equity Interests;
(5) any liability for taxes owed or owing by the Issuer;
(6) that portion of any Indebtedness incurred in violation of Section
4.10 (but, as to any such obligation, no such violation shall be deemed to
exist for purposes of this clause (6) if the holder(s) of such obligation
or their representative shall have received an Officers' Certificate of the
Issuer to the effect that the incurrence of such Indebtedness does not (or,
in the case of revolving credit indebtedness, that the incurrence of the
entire committed amount thereof at the date on which the initial borrowing
thereunder is made would not violate such provisions of this Indenture);
(7) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, is without
recourse to the Issuer; and
(8) any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of the Issuer.
"Significant Subsidiary" means (1) any Restricted Subsidiary that
would be a "significant subsidiary" as defined in Regulation S-X promulgated
pursuant to the Securities Act as such Regulation is in effect on the Issue Date
and (2) any Restricted Subsidiary that, when aggregated with all other
Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as
to which any event described in clause (8) or (9) under Section 6.01 has
occurred and is continuing, would constitute a Significant Subsidiary under
clause (1) of this definition).
"Stated Maturity" means, with respect to any installment of interest
or principal on any Indebtedness, the date on which such payment of interest or
principal is scheduled to be paid in the documentation governing such
Indebtedness, and shall not include any contingent obligations to repay, redeem
or repurchase any such interest or principal prior to the date originally
scheduled for the payment thereof.
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"Subordinated Indebtedness" means Indebtedness of the Issuer or any
Restricted Subsidiary that is subordinated in right of payment to the Notes or
the Note Guarantees, respectively.
"Subsidiary" means, with respect to any Person:
(1) any corporation, limited liability company, association or other
business entity 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 the Board of Directors thereof are
at the time owned or controlled, directly or indirectly, by such Person or
one or more of the other Subsidiaries of that Person (or a combination
thereof); and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or
(b) the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
Unless otherwise specified, "Subsidiary" refers to a Subsidiary of the Issuer.
"Transactions" means (a) the consummation of the acquisition by Parent
of the Issuer, (b) the equity investments in and contributions to Parent made
contemporaneously therewith, (c) the entering into and initial borrowing under
the Credit Agreement and (d) the issuance of the Notes, in each case occurring
on the Issue Date.
"Treasury Rate" means, with respect to any Change of Control
Redemption Date, the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published
in the most recent Federal Reserve Statistical Release H.15(519) that has become
publicly available at least two business days prior to such Change of Control
Redemption Date (or, if such Statistical Release is no longer published, any
publicly available source of similar market data)) most nearly equal to the
period from such Change of Control Redemption Date to November 1, 2007;
provided, however, that if the period from such Change of Control Redemption
Date to November 1, 2007 is not equal to the constant maturity of a United
States Treasury security for which a weekly average yield is given, the Treasury
Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury
securities for which such yields are given, except that if the period from such
Change of Control Redemption Date to November 1, 2007 is less than one year, the
weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
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"Unrestricted Securities" means one or more Notes that do not and are
not required to bear the Private Placement Legend in the form set forth in
Exhibit B, including, without limitation, the Exchange Notes.
"Unrestricted Subsidiary" means (1) any Subsidiary that at the time of
determination shall be designated an Unrestricted Subsidiary by the Board of
Directors of the Issuer in accordance with Section 4.19 and (2) any Subsidiary
of an Unrestricted Subsidiary.
"U.S. Government Obligations" means direct non-callable obligations
of, or obligations guaranteed by, the United States of America for the payment
of which guarantee or obligations the full faith and credit of the United States
is pledged.
"U.S. Legal Tender" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Voting Stock" with respect to any Person means securities of any
class of Equity Interests of such Person (in the case of a partnership, the sole
general partner or managing general partner of such Person) entitling the
holders thereof (whether at all times or only so long as no senior class of
stock or other relevant equity interest has voting power by reason of any
contingency) to vote in the election of members of the Board of Directors of
such Person.
"Weighted Average Life to Maturity," when applied to any Indebtedness
at any date, means the number of years obtained by dividing (1) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment by (2) the then outstanding principal
amount of such Indebtedness.
"Wholly-Owned Restricted Subsidiary" means a Restricted Subsidiary of
which 100% of the Equity Interests (except for directors' qualifying shares or
certain minority interests owned by other Persons solely due to local law
requirements that there be more than one stockholder, but which interest is not
in excess of what is required for such purpose) are owned directly by the Issuer
or through one or more Wholly-Owned Restricted Subsidiaries.
SECTION 1.02. Other Definitions.
Term Defined in Section
---- ------------------
144A Global Note........................................... 2.01
"Affiliate Transaction".................................... 4.14
"Change of Control Offer".................................. 4.09
"Change of Control Payment Date"........................... 4.09
"Change of Control Purchase Price"......................... 4.09
"Covenant Defeasance"...................................... 8.02
"Coverage Ratio Exception"................................. 4.10
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Term Defined in Section
---- ------------------
"Designation".............................................. 4.19
"Designation Amount"....................................... 4.19
"Event of Default"......................................... 6.01
"Excess Proceeds".......................................... 4.13
"Four-Quarter Period"...................................... 1.01
"Guarantee Obligations".................................... 11.01
"Legal Defeasance"......................................... 8.02
"Net Proceeds Deficiency".................................. 4.13
"Net Proceeds Offer"....................................... 4.13
"Net Proceeds Payment Date"................................ 4.13
"Non-Payment Default"...................................... 10.02
"Offered Price"............................................ 4.13
"Pari Passu Indebtedness Price"............................ 4.12
"Participants"............................................. 2.15
"Paying Agent"............................................. 2.03
"Payment Amount"........................................... 4.13
"Payment Blockage Notice".................................. 10.02
"Payment Blockage Period".................................. 10.02
"Payment Default".......................................... 10.02
"Permitted Indebtedness"................................... 4.10
"Permanent Regulation S Global Note"....................... 2.16
"Physical Notes"........................................... 2.01
"Redesignation"............................................ 4.19
"Registrar"................................................ 2.03
"Regulation S Global Note.................................. 2.16
"Restricted Payments Basket"............................... 4.11
"Successor"................................................ 5.01
"Temporary Regulation S Global Note"....................... 2.16
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the Trust Indenture
Act, such provision is incorporated by reference in, and made a part of, this
Indenture. The following Trust Indenture Act terms used in this Indenture have
the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
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"obligor" on the indenture securities means the Issuer, the Co-Issuer,
any Guarantor or any other obligor on the Notes.
All other Trust Indenture Act terms used in this Indenture that are
defined by the Trust Indenture Act, defined by Trust Indenture Act reference to
another statute or defined by SEC rule and not otherwise defined herein have the
meanings assigned to them therein.
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
(5) provisions apply to successive events and transactions;
(6) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision; and
(7) the words "including," "includes" and similar words shall be
deemed to be followed by "without limitation."
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. The
Issuers shall approve the form of the Notes and any notation, legend or
endorsement on them. Each Note shall be dated the date of its issuance and show
the date of its authentication. Each Note shall have an executed Note Guarantee
from each of the Guarantors endorsed thereon substantially in the form of
Exhibit F.
The terms and provisions contained in the Notes and the Note
Guarantees shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, 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.
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Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of a single permanent Global Note in registered form,
substantially in the form set forth in Exhibit A (the "144A Global Note"),
deposited with the Trustee, as custodian for the Depository, duly executed by
the Issuers (and having an executed Note Guarantee from each of the Guarantors
endorsed thereon) and authenticated by the Trustee as hereinafter provided and
shall bear the legends set forth in Exhibit B. The aggregate principal amount of
the 144A Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depository,
as hereinafter provided.
Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of a single temporary global
Note in registered form, substantially in the form of Exhibit A (the "Temporary
Regulation S Global Note"), deposited with the Trustee, as custodian for the
Depositary, duly executed by the Issuers (and having an executed Note Guarantee
from each of the Guarantors endorsed thereon) and authenticated by the Trustee
as hereinafter provided and shall bear the legend set forth in Exhibit B.
Reasonably promptly following the date that is 40 days after the later of the
commencement of the offering of the Notes in reliance on Regulation S and the
Issue Date, upon receipt by the Trustee and the Issuers of a duly executed
certificate substantially in the form of Exhibit E from the Depositary, a single
permanent Global Note in registered form substantially in the form of Exhibit A
(the "Permanent Regulation S Global Note," and together with the Temporary
Regulation S Global Note, the "Regulation S Global Note") duly executed by the
Issuers (and having an executed Note Guarantee from each of the Guarantors
endorsed thereon) and authenticated by the Trustee as hereinafter provided shall
be deposited with the Trustee, as custodian for the Depositary, and the
Registrar shall reflect on its books and records the cancellation of the
Temporary Regulation S Global Note and the issuance of the Permanent Regulation
S Global Note.
Notes issued in exchange for interests in a Global Note pursuant to
Section 2.16 may be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "Physical
Notes").
SECTION 2.02. Execution, Authentication and Denomination.
One Officer of each Issuer (who shall have been duly authorized by all
requisite corporate actions) shall sign the Notes for such Issuer by manual or
facsimile signature.
If an Officer whose signature is on a Note or Note Guarantee, as the
case may be, was an Officer at the time of such execution but no longer holds
that office at the time the Trustee authenticates the Note, the Note shall
nevertheless be valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate Notes for original issue on the Issue
Date in the aggregate principal amount of $150,000,000 upon a written order of
the Issuers in the form of an
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Officers' Certificate. In addition, the Trustee shall authenticate Notes
thereafter in unlimited amount (so long as not otherwise prohibited by the terms
of this Indenture, including without limitation, Section 4.10) for original
issue upon a written order of the Issuers in the form of an Officers'
Certificate. Each such Officers' Certificate shall specify the amount of Notes
to be authenticated and the date on which the Notes are to be authenticated.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Issuers to authenticate Notes. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Notes whenever the Trustee
may do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with the Issuers and Affiliates of the Issuers.
The Notes shall be issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof.
SECTION 2.03. Registrar and Paying Agent.
The Issuers shall maintain or cause to be maintained an office or
agency in the Borough of Manhattan, The City of New York, where (a) Notes may be
presented or surrendered for registration of transfer or for exchange
("Registrar"), (b) Notes may, subject to Section 2 of the Notes, be presented or
surrendered for payment ("Paying Agent") and (c) notices and demands to or upon
the Issuers in respect of the Notes and this Indenture may be served. The
Issuers may also from time to time designate one or more other offices or
agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Issuers
of their obligation to maintain or cause to be maintained an office or agency in
the Borough of Manhattan, The City of New York, for such purposes. The Issuers
may act as Registrar or Paying Agent, except that for the purposes of Articles
Three and Eight and Sections 4.09 and 4.13, neither the Issuers nor any
Affiliate of the Issuers shall act as Paying Agent. The Registrar shall keep a
register of the Notes and of their transfer and exchange. The Issuers, upon
notice to the Trustee, may have one or more co-registrars and one or more
additional paying agents reasonably acceptable to the Trustee. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Issuers initially appoint the Trustee as Registrar
and Paying Agent until such time as the Trustee has resigned or a successor has
been appointed.
The Issuers shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Issuers shall notify
the Trustee, in advance, of the name and address of any such Agent. If the
Issuers fail to maintain a Registrar or Paying Agent, the Trustee shall act as
such.
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SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Issuers shall require each Paying Agent other than the Trustee to
agree in writing that, subject to Article Ten and Section 11.02, each Paying
Agent shall hold in trust for the benefit of Holders or the Trustee all assets
held by the Paying Agent for the payment of principal of, or interest on, the
Notes (whether such assets have been distributed to it by the Issuers or any
other obligor on the Notes), and shall notify the Trustee of any Default by the
Issuers (or any other obligor on the Notes) in making any such payment. The
Issuers at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed and the Trustee may at
any time during the continuance of any payment Default, upon written request to
a Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Issuers to the
Paying Agent, the Paying Agent shall have no further liability for such assets.
SECTION 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Issuers shall furnish to the
Trustee at least two (2) Business Days prior to each Interest Payment Date and
at such other times as the Trustee may request in writing a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Holders, which list may be conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to Sections 2.15 and 2.16, when Notes are presented to the
Registrar with a request to register the transfer of such Notes or to exchange
such Notes for an equal principal amount of Notes of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transaction are met; provided, however,
that the Notes surrendered for transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Issuers and the Registrar, duly executed by the Holder thereof or his or her
attorney duly authorized in writing. To permit registrations of transfers and
exchanges, the Issuers shall execute and the Trustee shall authenticate Notes at
the Registrar's request. No service charge shall be made for any registration of
transfer or exchange, but the Issuers may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith.
Without the prior written consent of the Issuer, the Registrar shall
not be required to register the transfer of or exchange of any Note (i) during a
period beginning at the opening of business 15 days before the mailing of a
notice of redemption of Notes and ending at the close of business on the day of
such mailing, (ii) selected for redemption in whole or in part pursuant to
Article Three, except the unredeemed portion of any Note being redeemed in part,
and (iii) beginning at the opening of business on any Record Date and ending on
the close of business on the related Interest Payment Date.
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Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such beneficial interest, agree that transfers of beneficial
interests in such Global Notes 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 Note shall be required to be reflected in a
book-entry system.
SECTION 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the Holder of
a Note claims that the Note has been lost, destroyed or wrongfully taken, the
Issuers shall issue and the Trustee shall authenticate a replacement Note if the
Trustee's requirements are met. Such Holder must provide an indemnity bond or
other indemnity, sufficient in the judgment of both 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 Note is replaced. The Issuers may charge such Holder for its
reasonable out-of-pocket expenses in replacing a Note pursuant to this Section
2.07, including reasonable fees and expenses of counsel and of the Trustee.
Every replacement Note is an additional obligation of the Issuers and
every replacement Note Guarantee shall constitute an additional obligation of
the Guarantor thereof.
SECTION 2.08. Outstanding Notes.
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those cancelled by it, those delivered to it
for cancellation and those described in this Section as not outstanding. A Note
does not cease to be outstanding because the Issuers, the Guarantors or any of
their respective Affiliates hold the Note (subject to the provisions of Section
2.09).
If a Note is replaced pursuant to Section 2.07 (other than a mutilated
Note surrendered for replacement), it ceases to be outstanding unless a
Responsible Officer of the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser. A mutilated Note ceases to be
outstanding upon surrender of such Note and replacement thereof pursuant to
Section 2.07.
If the principal amount of any Note is considered paid under Section
4.01, it ceases to be outstanding and interest ceases to accrue. If on a
Redemption Date or the Maturity Date the Trustee or Paying Agent (other than the
Issuers or an Affiliate thereof) holds U.S. Legal Tender or U.S. Government
Obligations sufficient to pay all of the principal and interest due on the Notes
payable on that date, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Issuers or any of their
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Affiliates shall be disregarded, except that, for the purposes of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Notes that a Responsible Officer of the Trustee actually knows
are so owned shall be disregarded.
SECTION 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Issuers may prepare
and the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Issuers consider appropriate for temporary Notes. Without unreasonable delay,
the Issuers shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes. Until such exchange, temporary Notes shall be
entitled to the same rights, benefits and privileges as definitive Notes.
Notwithstanding the foregoing, so long as the Notes are represented by a Global
Note, such Global Note may be in typewritten form.
SECTION 2.11. Cancellation.
The Issuers at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee, or
at the direction of the Trustee, the Registrar or the Paying Agent (other than
the Issuers or a Subsidiary), and no one else, shall cancel and, at the written
direction of the Issuers, shall dispose of all Notes surrendered for transfer,
exchange, payment or cancellation in accordance with its customary procedures.
Subject to Section 2.07, the Issuers may not issue new Notes to replace Notes
that it has paid or delivered to the Trustee for cancellation. If the Issuers or
any Guarantor shall acquire any of the Notes, such acquisition shall not operate
as a redemption or satisfaction of the Indebtedness represented by such Notes
unless and until the same are surrendered to the Trustee for cancellation
pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Issuers default in a payment of interest on the Notes, they
shall, unless the Trustee fixes another record date pursuant to Section 6.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest, in any lawful manner. The Issuers may pay the defaulted
interest to the persons who are Holders on a subsequent special record date,
which date shall be the fifteenth day next preceding the date fixed by the
Issuers for the payment of defaulted interest or the next succeeding Business
Day if such date is not a Business Day. At least 15 days before any such
subsequent special record date, the Issuers shall mail to each Holder, with a
copy to the Trustee, a notice that states the subsequent special record date,
the payment date and the amount of defaulted interest, and interest payable on
such defaulted interest, if any, to be paid.
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SECTION 2.13. CUSIP Number.
The Issuers in issuing the Notes may use a "CUSIP" number, and if so,
the Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders; provided, however, that any such notice may state that
no representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Notes, and that reliance may be placed only on
the other identification numbers printed on the Notes. The Issuers will promptly
notify the Trustee of any change in the CUSIP numbers.
SECTION 2.14. Deposit of Moneys.
Subject to Section 2 of the Notes, prior to 10:00 a.m. New York City
time on each Interest Payment Date, Maturity Date, Redemption Date, Change of
Control Payment Date and Net Proceeds Payment Date, the Issuers shall have
deposited with the Paying Agent in immediately available funds money sufficient
to make cash payments, if any, due on such Interest Payment Date, Maturity Date,
Redemption Date, Change of Control Payment Date and Net Proceeds Payment Date,
as the case may be, in a timely manner which permits the Paying Agent to remit
payment to the Holders on such Interest Payment Date, Maturity Date, Redemption
Date, Change of Control Payment Date and Net Proceeds Payment Date, as the case
may be.
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 ("Participants") 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
Participants, the operation of customary practices governing the exercise of the
rights of a Holder of any Note.
(b) Transfers of Global Notes shall be limited to transfers 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 and the provisions of Section 2.16. 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 Depository is not appointed by the Issuers, with a copy to the
Trustee, within 90 days of such notice or (ii) a Default has occurred and is
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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 a Global Note to beneficial owners pursuant to paragraph
(b) of this Section 2.15, 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 such 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 authenticate and deliver, one or more
Physical Notes of authorized denominations in an aggregate principal amount
equal to the principal amount of the beneficial interest in the Global Note so
transferred.
(d) In connection with the transfer of a Global Note as an entirety to
beneficial owners pursuant to paragraph (b) of this Section 2.15, such Global
Note shall be deemed to be surrendered to the Trustee for cancellation, and (i)
the Issuers shall execute, (ii) the Guarantors shall execute notations of Note
Guarantees on and (iii) the Trustee shall upon written instructions from the
Issuers authenticate and deliver, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in such Global Note, an equal
aggregate principal amount of Physical Notes of authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b) or (c) of
this Section 2.15 shall, except as otherwise provided by Section 2.16, bear the
Private Placement Legend.
(f) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Participants and Persons that may hold interests
through Participants, to take any action which a Holder is entitled to take
under this Indenture or the Notes.
SECTION 2.16. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Restricted Security to any Institutional Accredited
Investor which is not a QIB:
(i) the Registrar shall register the transfer of any Restricted
Security, whether or not such Note bears the Private Placement Legend, if
(x) the requested transfer is after the second anniversary of the Issue
Date; provided, however, that neither the Issuers nor any Affiliate of the
Issuers has held any beneficial interest in such Note, or portion thereof,
at any time on or prior to the second anniversary of the Issue Date or (y)
the proposed transferee has delivered to the Registrar a certificate
substantially in the form of Exhibit C hereto and any legal opinions and
certifications as may be reasonably requested by the Trustee and the
Issuers;
(ii) if the proposed transferee is a Participant and the Notes to be
transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the IAI
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Global Note, upon receipt by the Registrar of the Physical Note and (x)
written instructions given in accordance with the Depository's and the
Registrar's procedures and (y) the certificate, if required, referred to in
clause (y) of paragraph (i) above, the Registrar shall register the
transfer and reflect on its books and records the date and an increase in
the principal amount of the IAI Global Note in an amount equal to the
principal amount of Physical Notes to be transferred, and the Registrar
shall cancel the Physical Notes so transferred; and
(iii) if the proposed transferor is a Participant seeking to transfer
an interest in a Global Note, upon receipt by the Registrar of (x) written
instructions given in accordance with the Depository's and the Registrar's
procedures and (y) the certificate, if required, referred to in clause (y)
of paragraph (i) above, the Registrar shall register the transfer and
reflect on its books and records the date and (A) a decrease in the
principal amount of the Global Note from which such interests are to be
transferred in an amount equal to the principal amount of the Notes to be
transferred and (B) an increase in the principal amount of the IAI Global
Note in an amount equal to the principal amount of the Notes to be
transferred.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Restricted Security to
a QIB:
(i) the Registrar shall register the transfer of any Restricted
Security, whether or not such Note bears the Private Placement Legend, if
(x) the requested transfer is after the second anniversary of the Issue
Date; provided, however, that neither the Issuers nor any Affiliate of the
Issuers has held any beneficial interest in such Note, or portion thereof,
at any time on or prior to the second anniversary of the Issue Date or (y)
such transfer is being made by a proposed transferor who has checked the
box provided for on the form of Note stating, or has otherwise advised the
Issuers and the Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Note stating, or has
otherwise advised the Issuers and the Registrar in writing, that it is
purchasing the Note for its own account or an account with respect to which
it exercises sole investment discretion and that it and any such account is
a QIB within the meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Issuers as it has requested pursuant to Rule
144A or has determined not to request such information and that it is aware
that the transferor is relying upon its foregoing representations in order
to claim the exemption from registration provided by Rule 144A;
(ii) if the proposed transferee is a Participant and the Notes to be
transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the 144A Global Note, upon receipt by the
Registrar of the Physical Note and written instructions given in accordance
with the Depository's and the Registrar's procedures, the Registrar shall
register the transfer and reflect on its book and records the date and an
increase in the principal amount of the 144A Global Note in an amount equal
to the princi-
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pal amount of Physical Notes to be transferred, and the Registrar shall
cancel the Physical Notes so transferred; and
(iii) if the proposed transferor is a Participant seeking to transfer
an interest in the IAI Global Note or the Regulation S Global Note, upon
receipt by the Registrar of written instructions given in accordance with
the Depository's and the Registrar's procedures, the Registrar shall
register the transfer and reflect on its books and records the date and (A)
a decrease in the principal amount of the IAI Global Note or the Regulation
S Global Note, as the case may be, in an amount equal to the principal
amount of the Notes to be transferred and (B) an increase in the principal
amount of the 144A Global Note in an amount equal to the principal amount
of the Notes to be transferred.
(c) Transfers of Interests in the Temporary Regulation S Global Note.
The following provisions shall apply with respect to the registration of any
proposed transfer of interests in the Temporary Regulation S Global Note:
(i) the Registrar shall register the transfer of an interest in the
Temporary Regulation S Global Note, whether or not such Global Note bears
the Private Placement Legend if (x) the proposed transferor has delivered
to the Registrar a certificate substantially in the form of Exhibit E
stating, among other things, that the proposed transferee is a Non-U.S.
Person (except for a transfer to an Initial Purchaser) or (y) the proposed
transferee is a QIB and the Registrar has received the documentation
required by Section 2.16(b) or the proposed transfer is to any
Institutional Accredited Investor which is not a QIB and the Registrar has
received the documentation required by Section 2.16(a); and
(ii) if the proposed transferee is a Participant, upon receipt by the
Registrar of the documents referred to in clause (i)(x) above, if required,
and instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and amount of such transfer of an interest in the
Temporary Regulation S Global Note.
(d) Transfers to Non-U.S. Persons. The following provisions shall
apply with respect to any transfer of a Restricted Security to a Non-U.S. Person
under Regulation S:
(i) the Registrar shall register any proposed transfer of a Restricted
Security to a Non-U.S. Person upon receipt of a certificate substantially
in the form of Exhibit D from the proposed transferor and such
certifications, legal opinions and other information as the Trustee or the
Issuers may reasonably request; and
(ii) (a) if the proposed transferor is a Participant holding a
beneficial interest in the Rule 144A Global Note or the IAI Global Note or
the Note to be transferred consists of Physical Notes, upon receipt by the
Registrar of (x) the documents required by paragraph (i) and (y)
instructions in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Rule 144A Global Note or the
IAI Global Note, as the case
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may be, in an amount equal to the principal amount of the beneficial
interest in the Rule 144A Global Note or the IAI Global Note, as the case
may be, to be transferred or cancel the Physical Notes to be transferred,
and (b) if the proposed transferee is a Participant, upon receipt by the
Registrar of instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Regulation
S Global Note in an amount equal to the principal amount of the Rule 144A
Global Note, the IAI Global Note or the Physical Notes, as the case may be,
to be transferred.
(e) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provisions of this Indenture, a Global Note may not be
transferred as a whole except by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or
a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless (i) there is delivered to the Trustee an Opinion of Counsel reasonably
satisfactory to the Issuers and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act or (ii) such Note
has been offered pursuant to an effective registration statement under the
Securities Act.
(g) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16.
The Issuers shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Note (including any transfers between or among Depositary Participants or
beneficial owners of interests in any Global Note) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
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The Trustee shall have no responsibility for the actions or omissions
of the Depository, or the accuracy of the books and records of the Depository.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Issuers elect to redeem Notes pursuant to Section 5 or Section
6 of the Notes, it shall notify the Trustee in writing of the Redemption Date,
the Redemption Price and the principal amount of Notes to be redeemed. The
Issuers shall give notice of redemption to the Paying Agent and Trustee at least
35 days but not more than 60 days before the Redemption Date (unless a shorter
notice shall be agreed to by the Trustee in writing), together with an Officers'
Certificate stating that such redemption will comply with the conditions
contained herein.
SECTION 3.02. Selection of Notes To Be Redeemed.
If less than all of the Notes are to be redeemed at any time, the
Trustee will select Notes for redemption as follows:
(x) if the Notes are listed on a national securities exchange, in
compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or
(y) if the Notes are not so listed, on a pro rata basis, by lot or by
such method as the Trustee shall deem fair and appropriate;
provided that, in the case of such redemption pursuant to Section 6(a) of the
Notes, the Trustee will select the Notes on a pro rata basis or on as nearly a
pro rata basis as practicable (subject to the procedures of the Depository)
unless that method is otherwise prohibited.
No Notes of $1,000 or less shall be redeemed in part.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuers shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Notes are to be redeemed at its registered address
(except that a notice issued in connection with a redemption referred to in
Section 8.01(2) may be more than 60 days before such Redemption Date). At the
Issuers' request, the Trustee shall forward the notice of redemption in the
Issuers' name and at the Issuers' expense. Each notice for redemption shall
identify the Notes (including the CUSIP number) to be redeemed and shall state:
(1) the Redemption Date;
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(2) the Redemption Price and the amount of accrued interest, if any,
to be paid;
(3) the name and address of the Paying Agent;
(4) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price plus accrued interest, if any;
(5) that, unless the Issuers default in making the redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date, and the only remaining right of the Holders of such Notes
is to receive payment of the Redemption Price upon surrender to the Paying
Agent of the Notes redeemed;
(6) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date, and upon surrender of such Note, a new Note or Notes in aggregate
principal amount equal to the unredeemed portion thereof will be issued;
(7) if fewer than all the Notes are to be redeemed, the identification
of the particular Notes (or portion thereof) to be redeemed, as well as the
aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes to be outstanding after such partial redemption;
and
(8) the Section of the Notes pursuant to which the Notes are to be
redeemed.
The notice, if mailed in a manner herein provided, shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Note designated for redemption in whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Note. Notices of redemption may not be conditional.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become due and payable on the Redemption Date and at
the Redemption Price plus accrued interest, if any. Upon surrender to the
Trustee or Paying Agent, such Notes called for redemption shall be paid at the
Redemption Price (which shall include accrued interest thereon to the Redemption
Date), but installments of interest, the maturity of which is on or prior to the
Redemption Date, shall be payable to Holders of record at the close of business
on the relevant Record Dates. On and after the Redemption Date interest shall
cease to accrue on Notes or portions thereof called for redemption unless the
Issuers shall have not complied with their obligations pursuant to Section 3.05.
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SECTION 3.05. Deposit of Redemption Price.
On or before 10:00 a.m. New York time on the Redemption Date, the
Issuers shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Redemption Price plus accrued and unpaid interest, if any, of all Notes to
be redeemed on that date.
If the Issuers comply with the preceding paragraph, then, unless the
Issuers default in the payment of such Redemption Price plus accrued interest,
if any, interest on the Notes to be redeemed will cease to accrue on and after
the applicable Redemption Date, whether or not such Notes are presented for
payment.
SECTION 3.06. Notes Redeemed in Part.
If any Note is to be redeemed in part only, the notice of redemption
that relates to such Note shall state the portion of the principal amount
thereof to be redeemed. A new Note or Notes in principal amount equal to the
unredeemed portion of the original Note or Notes shall be issued in the name of
the Holder thereof upon cancellation of the original Note or Notes.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes.
The Issuers shall pay the principal of (and premium, if any) and
interest on the Notes in the manner provided in the Notes, the Registration
Rights Agreement and this Indenture. An installment of principal of or interest
on the Notes shall be considered paid on the date it is due if the Trustee or
Paying Agent (other than the Issuers or an Affiliate thereof) holds on that date
U.S. Legal Tender designated for and sufficient to pay the installment. Interest
on the Notes will be computed on the basis of a 360-day year comprised of twelve
30-day months.
The Issuers shall pay interest on overdue principal (including,
without limitation, post petition interest in a proceeding under any Bankruptcy
Law), and overdue interest, to the extent lawful, at the same rate per annum
borne by the Notes.
SECTION 4.02. Maintenance of Office or Agency.
The Issuers shall maintain in the Borough of Manhattan, The City of
New York, the office or agency required under Section 2.03 (which may be an
office of the Trustee or an affiliate of the Trustee or Registrar). 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 set forth in Section
12.02.
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The Issuers may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. The
Issuers will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
The Issuers hereby initially designate U.S. Bank National Association,
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as such office
of the Issuers in accordance with Section 2.03.
SECTION 4.03. Corporate Existence.
Except as otherwise permitted by Article Five, the Issuer shall do or
cause to be done all things necessary to preserve and keep in full force and
effect its limited partnership existence and the corporate, partnership or other
existence of each of its Restricted Subsidiaries in accordance with the
respective organizational documents of each such Restricted Subsidiary and the
rights (charter and statutory) and material franchises of the Issuer and each of
its Restricted Subsidiaries and the Co-Issuer shall do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence; provided, however, that the Issuer shall not be required to preserve
any such right, franchise or corporate existence with respect to any Restricted
Subsidiary (other than the Co-Issuer) if the loss thereof would not,
individually or in the aggregate, have a material adverse effect on the
business, financial condition or results of operations of the Issuer and its
Restricted Subsidiaries taken as a whole.
SECTION 4.04. Payment of Taxes and Other Claims.
Each of the Issuers and the Guarantors shall, and shall cause each of
the Restricted Subsidiaries to, pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (a) all material taxes,
assessments and governmental charges levied or imposed upon it or any of the
Restricted Subsidiaries or upon the income, profits or property of it or any of
the Restricted Subsidiaries and (b) all lawful claims for labor, materials and
supplies which, in each case, if unpaid, might by law become a material
liability or Lien upon the property of it or any of the Restricted Subsidiaries;
provided, however, that the Issuers and the Guarantors shall not be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount the applicability or validity is being contested in
good faith by appropriate actions and for which appropriate provision has been
made.
SECTION 4.05. Maintenance of Properties and Insurance.
(a) The Issuer shall cause all material properties owned by or leased
by it or any of its Restricted Subsidiaries used or useful to the conduct of its
business or the business of any of its Restricted Subsidiaries to be maintained
and kept in normal condition, repair and working order and supplied with all
necessary equipment and shall cause to be made all repairs, renewals,
replacements, and betterments thereof, all as in its judgment may be necessary,
so that the business carried on in connection therewith may be properly and
advantageously conducted
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at all times; provided, however, that nothing in this Section 4.05 shall prevent
the Issuer or any of its Restricted Subsidiaries from discontinuing the use,
operation or maintenance of any of such properties, or disposing of any of them,
if such discontinuance or disposal is, in the judgment of the Board of Directors
of the Issuer or any such Restricted Subsidiary desirable in the conduct of the
business of the Issuer or any such Restricted Subsidiary, and if such
discontinuance or disposal would not, individually or in the aggregate, have a
material adverse effect on the ability of the Issuers or the Guarantors to
perform each of their respective obligations hereunder; provided, further, that
nothing in this Section 4.05 shall prevent the Issuer or any of its Restricted
Subsidiaries from discontinuing or disposing of any properties to the extent
otherwise permitted by this Indenture.
(b) The Issuer shall maintain, and shall cause its Restricted
Subsidiaries to maintain, insurance with responsible carriers against such risks
and in such amounts, and with such deductibles, retentions, self-insured amounts
and co-insurance provisions, as are customarily carried by similar businesses of
similar size, including property and casualty loss, workers' compensation and
interruption of business insurance.
SECTION 4.06. Compliance Certificate; Notice of Default.
(a) The Issuers shall deliver to the Trustee, within 120 days after
the close of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Issuers and their Subsidiaries has been made under the
supervision of the signing Officers with a view to determining whether the
Issuers and the Guarantors have kept, observed, performed and fulfilled their
obligations under this Indenture and further stating, as to each such Officer
signing such certificate, that to the best of such Officer's knowledge, the
Issuers and the Guarantors during such preceding fiscal year has kept, observed,
performed and fulfilled each and every such covenant and no Default occurred
during such year and at the date of such certificate there is no Default that
has occurred and is continuing or, if such signers do know of such Default, the
certificate shall describe its status with particularity. The Officers'
Certificate shall also notify the Trustee should the Issuers elect to change the
manner in which they fix their fiscal year end.
(b) The Issuers shall deliver to the Trustee as soon as possible and
in any event within five days after the Issuers becomes aware of the occurrence
of any Default an Officers' Certificate specifying the Default and describing
its status with particularity and the action proposed to be taken thereto.
SECTION 4.07. Compliance with Laws.
The Issuers shall comply, and shall cause each of their Restricted
Subsidiaries to comply, with all applicable statutes, rules, regulations, orders
and restrictions of the United States, all states and municipalities thereof,
and of any governmental department, commission, board, regulatory authority,
bureau, agency and instrumentality of the foregoing, in respect of the conduct
of their respective businesses and the ownership of their respective properties,
except, in any such case, to the extent the failure to so comply would not,
individually or in the aggregate,
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have a material adverse effect on the business, financial condition or results
of operations of the Issuers and their Restricted Subsidiaries taken as a whole.
SECTION 4.08. 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, plead, 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 that would prohibit or forgive such
Issuer or such Guarantor from paying all or any portion of the principal of
and/or interest on the Notes or the Note Guarantee of any such Guarantor 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 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 4.09. Change of Control.
If a Change of Control occurs, each Holder of Notes will have the
right to require the Issuers to repurchase all or any part (equal to $1,000 or
an integral multiple thereof) of that Holder's Notes pursuant to a Change of
Control Offer (the "Change of Control Offer"). In the Change of Control Offer,
the Issuers will offer to pay an amount in cash (the "Change of Control Purchase
Price") equal to 101% of the aggregate principal amount of Notes purchased, plus
accrued and unpaid interest thereon, if any, to the date of purchase. Within 30
days following any Change of Control, the Issuers will mail, or cause to be
mailed, a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to purchase Notes on the date (the
"Change of Control Payment Date") specified in such notice, which date shall be
a Business Day no earlier than 30 days and no later than 60 days from the date
such notice is mailed, pursuant to the procedures described below. Such notice
shall state:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.09 and that all Notes tendered and not withdrawn will be accepted
for payment;
(2) the purchase price (including the amount of accrued interest) and
the Change of Control Payment Date;
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Issuers default in making payment therefor, any
Note accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Note purchased pursuant to a
Change of Control Offer will be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, to the Paying Agent at
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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;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the second Business Day prior to the
Change of Control Payment Date, a telegram, facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the
Notes the Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Note purchased;
(7) that Holders whose Notes are purchased only in part will be issued
new Notes in a principal amount equal to the unpurchased portion of the
Notes surrendered (equal to $1,000 or an integral multiple thereof); and
(8) the circumstances and relevant facts regarding such Change of
Control.
On or before the Change of Control Payment Date, the Issuers will, to
the extent lawful:
. accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer;
. deposit with the Paying Agent U.S. Legal Tender sufficient to pay the
Change of Control Purchase Price in respect of all Notes or portions
thereof so tendered; and
. deliver or cause to be delivered to the Trustee the Notes so accepted
together with an Officers' Certificate stating the aggregate principal
amount of Notes or portions thereof being purchased by the Issuers.
The Paying Agent will promptly mail to each Holder of Notes so
tendered the Change of Control Purchase Price for such Notes, and the Trustee
will promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; provided that each such new Note will be in a
principal amount of $1,000 or an integral multiple thereof.
Prior to complying with any of the provisions of this Section 4.09,
but in any event within 90 days following a Change of Control, the Issuers will
either repay all outstanding Senior Debt or obtain the requisite consents, if
any, under all agreements governing outstanding Senior Debt to permit the
repurchase of Notes required by this covenant. The Issuers will publicly
announce the results of the Change of Control Offer as soon as practicable after
the Change of Control Payment Date.
The Issuers will not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth in this Indenture applicable to a
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Change of Control Offer made by the Issuers and purchases all Notes validly
tendered and not withdrawn under such Change of Control Offer.
The Issuers shall cause the Change of Control Offer to remain open for
at least 20 Business Days or for such longer period as may be required by law.
The Issuers will comply, and will cause any third party making a Change of
Control Offer to 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 a Change of Control
Offer. To the extent the provisions of any applicable securities laws or
regulations conflict with the provisions of this Indenture relating to a Change
of Control Offer, the Issuers will not be deemed to have breached their
obligations under this Indenture by virtue of complying with such laws or
regulations.
SECTION 4.10. Limitations on Additional Indebtedness.
(a) The Issuer will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, incur any Indebtedness; provided that the Issuer or
any Guarantor may incur additional Indebtedness if, after giving effect thereto,
the Consolidated Interest Coverage Ratio would be at least 2.00 to 1.00 (the
"Coverage Ratio Exception").
(b) Notwithstanding Section 4.10(a), each of the following shall be
permitted (the "Permitted Indebtedness"):
(1) Indebtedness of the Issuers and any Guarantor under the Credit
Facilities in an aggregate principal amount at any time outstanding not to
exceed the greater of (x) $70.0 million, less to the extent a permanent
repayment and/or commitment reduction is required thereunder as a result of
such application, the aggregate amount of Net Available Proceeds applied to
repayments under the Credit Facilities in accordance with Section 4.13(d)
and (y) the sum of (i) 85% of the book value of the accounts receivable
plus (ii) 65% of the book value of inventory of the Issuer and the
Restricted Subsidiaries, calculated on a consolidated basis and in
accordance with GAAP; provided that any letter of credit referred to in
clause (11) of this Section 4.10(b) that is undrawn shall be deemed to
constitute Indebtedness for purposes of this clause (1);
(2) the Notes issued on the Issue Date and the Note Guarantees and the
Exchange Notes and the Note Guarantees in respect thereof to be issued
pursuant to the Registration Rights Agreement;
(3) Indebtedness of the Issuer and the Restricted Subsidiaries to the
extent outstanding on the Issue Date (other than Indebtedness referred to
in clauses (1) and (2) above, and after giving effect to the intended use
of proceeds of the Notes);
(4) Indebtedness under Hedging Obligations that are designed to
protect against fluctuations in interest rates, foreign currency exchange
rates and commodity prices; provided that if such Hedging Obligations are
of the type described in clause (1)
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of the definition thereof, (a) such Hedging Obligations relate to payment
obligations on Indebtedness otherwise permitted to be incurred by this
Section 4.10, and (b) the notional principal amount of such Hedging
Obligations at the time incurred does not exceed the principal amount of
the Indebtedness to which such Hedging Obligations relate;
(5) Indebtedness of the Issuer owed to a Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary owed to the Issuer or any other
Restricted Subsidiary; provided, however, that upon any such Restricted
Subsidiary ceasing to be a Restricted Subsidiary or such Indebtedness being
owed to any Person other than the Issuer or a Restricted Subsidiary, the
Issuer or such Restricted Subsidiary, as applicable, shall be deemed to
have incurred Indebtedness not permitted by this clause (5);
(6) Indebtedness in respect of bid, performance or surety bonds issued
for the account of the Issuer or any Restricted Subsidiary in the ordinary
course of business, including guarantees or obligations of the Issuer or
any Restricted Subsidiary with respect to letters of credit supporting such
bid, performance or surety obligations (in each case other than for an
obligation for money borrowed);
(7) Purchase Money Indebtedness incurred by the Issuer or any
Restricted Subsidiary, and Refinancing Indebtedness thereof, in an
aggregate amount not to exceed at any time outstanding $10.0 million;
(8) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business; provided, however, that such
Indebtedness is extinguished within five Business Days of incurrence;
(9) Indebtedness arising in connection with endorsement of instruments
for deposit in the ordinary course of business;
(10) Refinancing Indebtedness with respect to Indebtedness incurred
pursuant to the Coverage Ratio Exception or clause (2) or (3) above;
(11) Indebtedness supported by one or more letters of credit under the
Credit Facilities in accordance with clause (1); provided that the amount
of Indebtedness permitted to be incurred under this clause (11) supported
by any such letter(s) of credit shall not exceed the amount of such
letter(s) of credit; provided further that upon any reduction, cancellation
or termination of such letter(s) of credit, there shall be deemed to be an
incurrence of Indebtedness under this Indenture that must be otherwise
permitted to be incurred under this Indenture equal to the excess of the
amount of such Indebtedness outstanding immediately after such reduction,
cancellation or termination over the remaining stated amount, if any, of
such letter(s) of credit or the stated amount of any letter(s) of credit
issued in a contemporaneous replacement of such letter(s) of credit;
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(12) Indebtedness of Foreign Subsidiaries in an aggregate amount not
to exceed $5.0 million at any one time outstanding;
(13) Attributable Indebtedness incurred by the Issuer or any
Restricted Subsidiary in an aggregate amount not to exceed $5.0 million at
any one time outstanding; and
(14) Indebtedness of the Issuer or any Restricted Subsidiary in an
aggregate amount not to exceed $15.0 million at any one time outstanding.
(c) For purposes of determining compliance with this Section 4.10, in
the event that an item of Indebtedness meets the criteria of more than one of
the categories of Permitted Indebtedness described in clauses (1) through (14)
of Section 4.10(b) or is entitled to be incurred pursuant to the Coverage Ratio
Exception, the Issuer shall classify and may reclassify, in each case in its
sole discretion, such item of Indebtedness and may divide, classify and
reclassify such Indebtedness in more than one of the types of Indebtedness
described, except that Indebtedness incurred under the Credit Facilities on the
Issue Date shall be deemed to have been incurred under clause (1) of Section
4.10(b). In addition, for purposes of determining any particular amount of
Indebtedness under this Section 4.10, guarantees, Liens or letter of credit
obligations supporting Indebtedness otherwise included in the determination of
such particular amount shall not be included so long as incurred by a Person
that could have incurred such Indebtedness.
SECTION 4.11. Limitations on Restricted Payments.
(a) The Issuer will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, make any Restricted Payment if at the time of such
Restricted Payment:
(1) a Default shall have occurred and be continuing or shall occur as
a consequence thereof;
(2) the Issuer cannot incur $1.00 of additional Indebtedness pursuant
to the Coverage Ratio Exception; or
(3) the amount of such Restricted Payment, when added to the aggregate
amount of all other Restricted Payments made after the Issue Date (other
than Restricted Payments made pursuant to clause (2), (3), (4), (5), (6),
(7), (8), (9), (10) or (11) of Section 4.11(b)), exceeds the sum (the
"Restricted Payments Basket") of (without duplication):
(a) 50% of Consolidated Net Income for the period (taken as one
accounting period) commencing on the first day of the first full
fiscal quarter commencing after the Issue Date to and including the
last day of the fiscal quarter ended immediately prior to the date of
such calculation for which consolidated fi-
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nancial statements are available (or, if such Consolidated Net Income
shall be a deficit, minus 100% of such aggregate deficit), plus
(b) 100% of the aggregate net cash proceeds received by the
Issuer either (x) as contributions to the common equity of the Issuer
after the Issue Date or (y) from the issuance and sale of Qualified
Equity Interests after the Issue Date, in each case, other than any
such proceeds which are used (x) to redeem Notes in accordance with
Section 6(a) of the Notes or (y) to make Restricted Payments in
reliance on clause (3) of Section 4.11(b), plus
(c) the aggregate amount by which Indebtedness (other than any
Subordinated Indebtedness) incurred by the Issuer or any Restricted
Subsidiary subsequent to the Issue Date is reduced on the Issuer's
balance sheet upon the conversion or exchange (other than by a
Subsidiary of the Issuer) into Qualified Equity Interests (less the
amount of any cash, or the fair value of assets, distributed by the
Issuer or any Restricted Subsidiary upon such conversion or exchange),
plus
(d) in the case of the disposition or repayment of or return on
any Investment that was treated as a Restricted Payment made after the
Issue Date, an amount equal to the lesser of (i) the return of capital
with respect to such Investment and (ii) the amount of such Investment
that was treated as a Restricted Payment, in either case, less the
cost of the disposition of such Investment and net of taxes, plus
(e) upon a Redesignation of an Unrestricted Subsidiary as a
Restricted Subsidiary, the lesser of (i) the Fair Market Value of the
Issuer's proportionate interest in such Subsidiary immediately
following such Redesignation, and (ii) the aggregate amount of the
Issuer's Investments in such Subsidiary to the extent such Investments
reduced the Restricted Payments Basket and were not previously repaid
or otherwise reduced.
(b) The foregoing provisions will not prohibit:
(1) the payment by the Issuer or any Restricted Subsidiary of any
dividend or other distribution within 60 days after the date of declaration
thereof, if on the date of declaration the payment would have complied with
the provisions of this Indenture;
(2) the redemption of any Equity Interests of the Issuer or any
Restricted Subsidiary in exchange for, or out of the proceeds of the
substantially concurrent issuance and sale of, Qualified Equity Interests;
(3) the redemption of Subordinated Indebtedness of the Issuer or any
Restricted Subsidiary (a) in exchange for, or out of the proceeds of the
substantially concurrent issuance and sale of, Qualified Equity Interests
or (b) in exchange for, or out of the
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proceeds of the substantially concurrent incurrence of, Refinancing
Indebtedness permitted to be incurred under Section 4.10 and the other
provisions of this Indenture;
(4) payments to Parent to permit Parent, and which are used by Parent,
to redeem Equity Interests of Parent, or payments to redeem Equity
Interests of the Issuer, in each case held by officers, directors or
employees or former officers, directors or employees (or their transferees,
estates or beneficiaries under their estates) thereof, upon their death,
disability, retirement, severance or termination of employment or service;
provided that the aggregate cash consideration paid for all such
redemptions shall not exceed in any calendar year the sum of (x) $3.0
million (and up to 50% of such $3.0 million not used in any calendar year
may be carried forward to the next succeeding (but no other) calendar
year), plus (y) the amount of any net cash proceeds received by or
contributed to the Issuer from the issuance and sale since the Issue Date
of Qualified Equity Interests of Parent or the Issuer to its officers,
directors or employees that have not been applied to the payment of
Restricted Payments pursuant to the terms of clause (b) of the preceding
paragraph or this clause (4), plus (z) the net cash proceeds of any
"key-man" life insurance policies that have not been applied to the payment
of Restricted Payments pursuant to this clause (4); provided further that
the cancellation of Indebtedness owing to the Issuer or any Restricted
Subsidiary in connection with the repurchase of Qualified Equity Interests
will not be deemed to constitute a Restricted Payment under this Indenture;
(5) the payment by the Issuer of Permitted Tax Distributions to
Parent;
(6) (A) payments by the Issuer to or on behalf of Parent in an amount
sufficient to pay franchise taxes and other fees required to maintain the
legal existence of Parent or another direct or indirect parent corporation
of the Issuer and (B) payments by the Issuer to or on behalf of Parent in
an amount sufficient to pay out-of-pocket legal, accounting and filing
costs and other expenses in the nature of overhead in the ordinary course
of business of Parent or another direct or indirect parent corporation of
the Issuer, in the case of clauses (A) and (B) in an aggregate amount not
to exceed $750,000 in any calendar year;
(7) repurchases of Equity Interests deemed to occur upon the exercise
or conversion of stock options or other incentive Equity Interests, if such
repurchased or converted Equity Interests represent a portion of the
exercise price thereof;
(8) repayments of Subordinated Indebtedness from Net Available
Proceeds remaining after a Net Proceeds Offer made pursuant to Section
4.13;
(9) distributions to Parent in order to enable Parent to pay customary
and reasonable costs and expenses of a public offering of securities of
Parent that is not consummated, so long as the net proceeds of such public
offering were intended to be contributed to the Issuer;
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(10) payments to Parent required to enable Parent to consummate the
Transactions; or
(11) additional Restricted Payments of $10.0 million;
provided that (a) in the case of any Restricted Payment pursuant to clause (4),
(8) or (11) above, no Default shall have occurred and be continuing or occur as
a consequence thereof and (b) no issuance and sale of Qualified Equity Interests
described in clause (2), (3) or (4) above shall increase the Restricted Payments
Basket.
SECTION 4.12. Limitations on Liens.
The Issuer shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or permit or suffer to exist
any Lien of any nature whatsoever against (other than Permitted Liens) any
assets of the Issuer or any Restricted Subsidiary (including Equity Interests of
a Restricted Subsidiary), whether owned at the Issue Date or thereafter
acquired, or any proceeds therefrom, or assign or otherwise convey any right to
receive income or profits therefrom, unless contemporaneously therewith:
(1) in the case of any Lien securing an obligation that ranks pari
passu with the Notes or a Note Guarantee, effective provision is made to
secure the Notes or such Note Guarantee, as the case may be, at least
equally and ratably with or prior to such obligation with a Lien on the
same collateral; and
(2) in the case of any Lien securing an obligation that is
subordinated in right of payment to the Notes or a Note Guarantee,
effective provision is made to secure the Notes or such Note Guarantee, as
the case may be, with a Lien on the same collateral that is prior to the
Lien securing such subordinated obligation,
in each case, for so long as such obligation is secured by such Lien.
SECTION 4.13. Limitations on Asset Sales.
(a) The Issuer will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, consummate any Asset Sale unless:
(1) the Issuer or such Restricted Subsidiary receives consideration at
the time of such Asset Sale at least equal to the Fair Market Value of the
assets included in such Asset Sale; and
(2) at least 75% of the total consideration received in such Asset
Sale consists of cash or Cash Equivalents.
(b) For purposes of the preceding clause (2), the following shall be
deemed to be cash:
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(1) the amount (without duplication) of any Indebtedness (other than
Subordinated Indebtedness) of the Issuer or such Restricted Subsidiary that
is expressly assumed by the transferee in such Asset Sale and with respect
to which the Issuer or such Restricted Subsidiary, as the case may be, is
unconditionally released by the holder of such Indebtedness,
(2) the amount of any securities, notes or other obligations received
from such transferee that are within 90 days converted by the Issuer or
such Restricted Subsidiary to cash (to the extent of the cash actually so
received), and
(3) the Fair Market Value of any assets (other than securities)
received by the Issuer or any Restricted Subsidiary to be used by it in the
Permitted Business.
(c) If at any time any non-cash consideration received by the Issuer
or any Restricted Subsidiary of the Issuer, as the case may be, in connection
with any Asset Sale is repaid or converted into or sold or otherwise disposed of
for cash (other than interest received with respect to any such non-cash
consideration), then the date of such repayment, conversion or disposition shall
be deemed to constitute the date of an Asset Sale hereunder and the Net
Available Proceeds thereof shall be applied in accordance with this Section
4.13.
(d) If the Issuer or any Restricted Subsidiary engages in an Asset
Sale, the Issuer or such Restricted Subsidiary shall, no later than 365 days
following the consummation thereof, apply amount(s) equal to all or any of the
Net Available Proceeds therefrom to:
(1) repay Senior Debt or Guarantor Senior Debt, and in the case of any
such Senior Debt or Guarantor Senior Debt under any revolving credit
facility, effect a permanent reduction in the availability under such
revolving credit facility;
(2) repay any Indebtedness which was secured by the assets sold in
such Asset Sale; and/or
(3) (A) invest all or any part of the Net Available Proceeds thereof
in the purchase of assets (other than securities) to be used by the Issuer
or any Restricted Subsidiary in the Permitted Business, (B) acquire
Qualified Equity Interests in a Person that is a Restricted Subsidiary or
in a Person engaged in a Permitted Business that shall become a Restricted
Subsidiary immediately upon the consummation of such acquisition or (C) a
combination of (A) and (B).
The amount of Net Available Proceeds not applied or invested as provided in this
paragraph will constitute "Excess Proceeds."
(e) When the aggregate amount of Excess Proceeds equals or exceeds
$10.0 million, the Issuer and the Co-Issuer will be required to make an offer to
purchase from all Holders and, if applicable, redeem (or make an offer to do so)
any Pari Passu Indebtedness of the Issuer or the Co-Issuer the provisions of
which require the Issuer or the Co-Issuer to redeem such
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Indebtedness with the proceeds from any Asset Sales (or offer to do so), in an
aggregate principal amount of Notes and such Pari Passu Indebtedness equal to
the amount of such Excess Proceeds as follows:
(1) the Issuer and the Co-Issuer will (a) make an offer to purchase (a
"Net Proceeds Offer") to all Holders in accordance with the procedures set
forth below, and (b) redeem (or make an offer to do so) any such other Pari
Passu Indebtedness, pro rata in proportion to the respective principal
amounts of the Notes and such other Indebtedness required to be redeemed,
the maximum principal amount of Notes and Pari Passu Indebtedness that may
be redeemed out of the amount (the "Payment Amount") of such Excess
Proceeds;
(2) the offer price for the Notes will be payable in cash in an amount
equal to 100% of the principal amount of the Notes tendered pursuant to a
Net Proceeds Offer, plus accrued and unpaid interest thereon, if any, to
the date such Net Proceeds Offer is consummated (the "Offered Price"), and
the redemption price for such Pari Passu Indebtedness (the "Pari Passu
Indebtedness Price") shall be as set forth in the related documentation
governing such Indebtedness;
(3) if the aggregate Offered Price of Notes validly tendered and not
withdrawn by Holders thereof exceeds the pro rata portion of the Payment
Amount allocable to the Notes, Notes to be purchased will be selected on a
pro rata basis; and
(4) upon completion of such Net Proceeds Offer in accordance with the
foregoing provisions, the amount of Excess Proceeds with respect to which
such Net Proceeds Offer was made shall be deemed to be zero.
(f) To the extent that the sum of the aggregate Offered Price of Notes
tendered pursuant to a Net Proceeds Offer and the aggregate Pari Passu
Indebtedness Price paid to the holders of such Pari Passu Indebtedness is less
than the Payment Amount relating thereto (such shortfall constituting a "Net
Proceeds Deficiency"), the Issuer may use the Net Proceeds Deficiency, or a
portion thereof, for general corporate purposes, subject to the provisions of
this Indenture.
(g) In the event of the transfer of substantially all (but not all) of
the assets of the Issuer and the Restricted Subsidiaries as an entirety to a
Person in a transaction covered by and effected in accordance with Section 5.01,
the successor corporation shall be deemed to have sold for cash at Fair Market
Value the assets of the Issuer and the Restricted Subsidiaries not so
transferred for purposes of this covenant, and shall comply with the provisions
of this covenant with respect to such deemed sale as if it were an Asset Sale
(with such Fair Market Value being deemed to be Net Available Proceeds for such
purpose).
(h) Upon the commencement of a Net Proceeds Offer, the Issuer shall
send, by first class mail, a notice to the Trustee and to each Holder at is
registered address. The notice shall contain all instructions and materials
necessary to enable such Holder to tender Notes pur-
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suant to the Net Proceeds Offer. Any Net Proceeds Offer shall be made to all
Holders. The notice, which shall govern the terms of the Net Proceeds Offer,
shall state:
(1) that the Net Proceeds Offer is being made pursuant to this Section
4.13;
(2) the Payment Amount, the Offered Price, and the date on which Notes
tendered and accepted for payment shall be purchased, which date shall be
at least 30 days and not later than 60 days from the date such notices is
mailed (the "Net Proceeds Payment Date");
(3) that any Notes nor tendered or accepted for payment shall continue
to accrete or accrue interest;
(4) that, unless the Issuer defaults in making such payment, any Notes
accepted for payment pursuant to the Net Proceeds Offer shall cease to
accrete or accrue interest after the Net Proceeds Payment Date;
(5) that Holders electing to have a Note purchased pursuant to the Net
Proceeds Offer may only elect to have all of such Note purchased and may
not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Net
Proceeds Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Issuer, a depository,
if appointed by the Issuer, or the Paying Agent at the address specified in
the notice at least three days before the Net Proceeds Payment Date;
(7) that Holders shall be entitled to withdraw their election if the
Issuer, the Depository or the Paying Agent, as the case may be, receives,
not later than the Net Proceeds Payment Date, a notice setting forth the
name of the Holder, the principal amount of the Note the Holder delivered
for purchase and a statement that such Holder is withdrawing his election
to have such Note purchased;
(8) that if the aggregate principal amount of Notes surrendered by
Holders exceeds the Payment Amount, the Issuer shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(9) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry).
(i) On the Net Proceeds Payment Date, the Issuer shall, to the extent
lawful: (1) accept for payment all Notes or portions thereof properly tendered
pursuant to the Net Pro-
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ceeds Offer; (2) deposit with the Paying Agent U.S. Legal Tender sufficient to
pay the Offered Price in respect of all Notes or portions thereof so tendered;
and (3) deliver or cause to be delivered to the Trustee the Notes so accepted
together with an Officers' Certificate stating the aggregate principal amount of
Notes or portions thereof being repurchased by the Issuer. the Issuer shall
publicly announce the results of the Net Proceeds Offer on the Net Proceeds
Payment Date.
(j) The Paying Agent shall promptly mail to each Holder of Notes so
tendered the Offered Price for such Notes, and the Trustee shall promptly
authenticate pursuant to an Authentication Order and mail (or cause to be
transferred by book-entry) to each Holder a new Note equal in principal amount
to any unrepurchased portion of the Notes surrendered, if any; provided that
each such new Note shall be in principal amount of $1,000 or an integral
multiple thereof. However, if the Net Proceeds Payment Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest shall be paid to the Person in whose name a Note is
registered at the close of business on such record date, and no additional
interest shall be payable to Holders who tender Notes pursuant to the Net
Proceeds Offer.
(k) The Issuer and the Co-Issuer will comply with applicable tender
offer rules, including the requirements of Rule 14e-1 under the Exchange Act and
any other applicable laws and regulations in connection with the purchase of
Notes pursuant to a Net Proceeds Offer. To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Indenture
relating to a Net Proceeds Offer, the Issuer and the Co-Issuer shall comply with
the applicable securities laws and regulations and will not be deemed to have
breached their obligations under this Indenture by virtue of this compliance.
SECTION 4.14. Limitations on Transactions with Affiliates.
(a) The Issuer will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, in one transaction or a series of related
transactions, sell, lease, transfer or otherwise dispose of any of its assets
to, or purchase any assets from, or enter into any contract, agreement,
understanding, loan, advance or guarantee with, or for the benefit of, any
Affiliate (an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less favorable
to the Issuer or the relevant Restricted Subsidiary than those that would
have been obtained in a comparable transaction at such time on an
arm's-length basis by the Issuer or that Restricted Subsidiary from a
Person that is not an Affiliate of the Issuer or that Restricted
Subsidiary; and
(2) the Issuer delivers to the Trustee:
(x) with respect to any Affiliate Transaction involving aggregate
value in excess of $2.5 million, an Officers' Certificate certifying
that such Affiliate Transaction complies with clause (1) above and a
Secretary's Certificate which
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sets forth and authenticates a resolution that has been adopted by a
majority of the Independent Directors approving such Affiliate
Transaction; and
(y) with respect to any Affiliate Transaction involving aggregate
value of $10.0 million or more, the certificates described in the
preceding clause (x) and a written opinion as to the fairness of such
Affiliate Transaction to the Issuer or such Restricted Subsidiary from
a financial point of view issued by an Independent Financial Advisor.
(b) The foregoing restrictions shall not apply to:
(1) transactions exclusively between or among (a) the Issuer and one
or more Restricted Subsidiaries or (b) Restricted Subsidiaries;
(2) reasonable and customary director, officer and employee
compensation (including bonuses) and other benefits (including retirement,
health, stock option and other benefit plans) and indemnification
arrangements;
(3) loans and advances permitted by clause (3) of the definition of
"Permitted Investments";
(4) payments to ▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇, LLC and Trimaran Fund
Management, L.L.C. under the Management and Monitoring Agreement as in
effect on the Issue Date or as thereafter amended or supplemented in any
manner that, taken as a whole, is not more disadvantageous to the Holders
in any material respect than the Management and Monitoring Agreement as in
effect on the Issue Date;
(5) Restricted Payments which are made in accordance with Section
4.11;
(6) transactions with customers, clients, suppliers, joint venture
partners or purchasers or sellers of goods and services, in each case in
the ordinary course of business and otherwise not prohibited by this
Indenture;
(7) (x) any agreement in effect on the Issue Date and disclosed in the
Offering Memorandum, as in effect on the Issue Date or as thereafter
amended or replaced in any manner, that, taken as a whole, is not more
disadvantageous to the Holders in any material respect than such agreement
as it was in effect on the Issue Date or (y) any transaction pursuant to
any agreement referred to in the immediately preceding clause (x);
(8) the existence of, and the performance by the Issuer or any of its
Restricted Subsidiaries of its obligations under the terms of, any limited
liability company, limited partnership or other organizational document or
securityholders agreement (including any registration rights agreement or
purchase agreement related thereto) to which it is a party on the Issue
Date and which is described in the Offering Memorandum, as in effect on
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the Issue Date, and similar agreements that it may enter into thereafter;
provided, however, that the existence of, or the performance by the Issuer
or any of its Restricted Subsidiaries of obligations under, any amendment
to any such existing agreement or any such similar agreement entered into
after the date of this Indenture shall only be permitted by this clause (8)
to the extent not more disadvantageous to the Holders in any material
respect, when taken as a whole, than any of such documents and agreements
as in effect on the Issue Date;
(9) sales of Qualified Equity Interests to Affiliates of the Issuer
not otherwise prohibited by this Indenture and the granting of registration
and other customary rights in connection therewith; and
(10) any transaction with an Affiliate where the only consideration
paid by the Issuer or any Restricted Subsidiary is Qualified Equity
Interests.
SECTION 4.15. Limitations on Dividend and Other Restrictions Affecting
Subsidiaries.
The Issuer will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary to:
(a) pay dividends or make any other distributions on or in respect of
its Equity Interests;
(b) make loans or advances or pay any Indebtedness or other obligation
owed to the Issuer or any other Restricted Subsidiary; or
(c) transfer any of its assets to the Issuer or any other Restricted
Subsidiary; except for:
(1) encumbrances or restrictions existing under or by reason of
applicable law;
(2) encumbrances or restrictions existing under this Indenture,
the Notes and the Note Guarantees;
(3) non-assignment provisions of any contract or any lease or
license entered into in the ordinary course of business;
(4) encumbrances or restrictions existing under agreements
existing on the date of this Indenture (including, without limitation,
the Credit Facilities) as in effect on that date;
(5) restrictions on the transfer of assets subject to any Lien
permitted under this Indenture imposed by the holder of such Lien;
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(6) restrictions on the transfer of assets imposed under any
agreement to sell such assets permitted under this Indenture to any
Person pending the closing of such sale;
(7) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired, so long as such
Acquired Indebtedness was not incurred in connection with, or in
contemplation of, such acquisition;
(8) any other agreement governing Indebtedness entered into after
the Issue Date that contains encumbrances and restrictions that are
not materially more restrictive with respect to any Restricted
Subsidiary than those in effect on the Issue Date with respect to that
Restricted Subsidiary pursuant to agreements in effect on the Issue
Date;
(9) customary provisions in partnership agreements, limited
liability company organizational governance documents, joint venture
agreements and other similar agreements that restrict the transfer of
ownership interests in such partnership, limited liability company,
joint venture or similar Person;
(10) Purchase Money Indebtedness and Attributable Indebtedness
incurred in compliance with Section 4.10 that impose restrictions of
the nature described in clause (c) above on the assets acquired; and
(11) any encumbrances or restrictions imposed by any amendments
or refinancings of the contracts, instruments or obligations referred
to in clauses (1) through (10) above; provided that such amendments or
refinancings are, in the good faith judgment of the Issuer's Board of
Directors, no more materially restrictive with respect to such
encumbrances and restrictions than those prior to such amendment or
refinancing.
SECTION 4.16. Additional Note Guarantees.
(a) If, after the Issue Date, (x) the Issuer or any Restricted
Subsidiary shall acquire or create another Subsidiary (other than in any case a
Subsidiary that has been designated an Unrestricted Subsidiary) that guarantees
any Indebtedness under any Credit Facility, (y) any Unrestricted Subsidiary is
redesignated a Restricted Subsidiary and such Restricted Subsidiary guarantees
any Indebtedness under any Credit Facility or (z) the Issuer otherwise elects to
have any Restricted Subsidiary become a Guarantor, then, in each such case, the
Issuer shall cause such Restricted Subsidiary to:
(1) execute and deliver to the Trustee (a) a supplemental indenture in
form and substance satisfactory to the Trustee pursuant to which such
Restricted Subsidiary
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shall unconditionally guarantee all of the Issuer's obligations under the
Notes and this Indenture and (b) a notation of guarantee in respect of its
Note Guarantee; and
(2) deliver to the Trustee one or more opinions of counsel that such
supplemental indenture (a) has been duly authorized, executed and delivered
by such Restricted Subsidiary and (b) constitutes a valid and legally
binding obligation of such Restricted Subsidiary in accordance with its
terms.
Thereafter, such Restricted Subsidiary shall be a Guarantor for all purposes of
this Indenture.
(b) Notwithstanding Section 4.16(a), any Note Guarantee will be
automatically and unconditionally released and discharged under the
circumstances set forth in Section 11.05. The form of the Note Guarantee is
attached hereto as Exhibit F.
SECTION 4.17. No Senior Subordinated Debt.
The Issuer will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, incur or suffer to exist any Indebtedness that is or
purports to be by its terms (or by the terms of any agreement governing such
Indebtedness) senior in right of payment to the Notes or the Note Guarantee of
such Restricted Subsidiary and subordinated in right of payment to any other
Indebtedness of the Issuer or of such Restricted Subsidiary, as the case may be.
For purposes of the foregoing, no Indebtedness will be deemed to be subordinated
in right of payment to any other Indebtedness of the Issuer or any Restricted
Subsidiary solely by virtue of being unsecured or by virtue of the fact that the
holders of such Indebtedness have entered into intercreditor agreements or other
arrangements giving one or more of such holders priority over the other holders
in the collateral held by them.
SECTION 4.18. Reports to Holders.
Whether or not required by the SEC, so long as any Notes are
outstanding, the Issuer will furnish to the Holders of Notes or file
electronically with the SEC through the SEC's Electronic Data Gathering,
Analysis, and Retrieval System (or any successor system), within the time
periods that would be applicable to the Issuer if it were subject to Section
13(a) or 15(d) of the Exchange Act:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the SEC on Forms 10-Q and 10-K if
the Issuer were required to file these Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
and, with respect to the annual information only, a report on the annual
financial statements by the Issuer's certified independent accountants;
provided that the Issuer shall not be required to furnish to the Holders or
file with the SEC a Form 10-Q for the fiscal quarter ending on September
30, 2003 until the 45th day after the Issue Date; and
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(2) all current reports that would be required to be filed with the
SEC on Form 8-K if the Issuer were required to file these reports.
In addition, whether or not required by the SEC, the Issuer will file
a copy of all of the information and reports referred to in clauses (1) and (2)
above with the SEC for public availability within the time periods specified in
the SEC's rules and regulations (unless the SEC will not accept the filing) and
make the information available to securities analysts and prospective investors
upon request; provided that until the Exchange Offer shall be consummated or any
Shelf Registration Statement shall be effective, if the Issuer shall post all of
such information and reports on its website on or before the dates such
information and reports would have been required to be filed with the SEC if the
Issuer had been required to file such information and reports with the SEC, such
information and reports shall not be required to be filed with the SEC. The
Issuer and the Guarantors have agreed that, for so long as any Notes remain
outstanding, the Issuer will furnish to the Holders and to securities analysts
and prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 4.19. Limitations on Designation of Unrestricted Subsidiaries.
(a) The Issuer may designate any Subsidiary of the Issuer (other than
the Co-Issuer) as an "Unrestricted Subsidiary" under this Indenture (a
"Designation") only if:
(1) no Default shall have occurred and be continuing at the time of or
after giving effect to such Designation; and
(2) the Issuer would be permitted to make, at the time of such
Designation, (a) a Permitted Investment or (b) an Investment pursuant to
Section 4.11, in either case, in an amount (the "Designation Amount") equal
to the Fair Market Value of the Issuer's proportionate interest in such
Subsidiary on such date.
(b) No Subsidiary shall be Designated as an "Unrestricted Subsidiary"
unless such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Issuer or any Restricted Subsidiary unless the terms
of the agreement, contract, arrangement or understanding are no less
favorable to the Issuer or the Restricted Subsidiary than those that might
be obtained at the time from Persons who are not Affiliates;
(3) is a Person with respect to which neither the Issuer nor any
Restricted Subsidiary has any direct or indirect obligation (a) to
subscribe for additional Equity Interests or (b) to maintain or preserve
the Person's financial condition or to cause the Person to achieve any
specified levels of operating results; and
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(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of the Issuer or any Restricted
Subsidiary, except for any guarantee given solely to support the pledge by
the Issuer or any Restricted Subsidiary of the Equity Interests of such
Unrestricted Subsidiary, which guarantee is not recourse to the Issuer or
any Restricted Subsidiary, and except to the extent the amount thereof
constitutes a Restricted Payment permitted pursuant to Section 4.11.
(c) If, at any time, any Unrestricted Subsidiary fails to meet the
requirements of Section 4.19(a) and (b) as an Unrestricted Subsidiary, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture
and any Indebtedness of the Subsidiary and any Liens on assets of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary as of the
date and, if the Indebtedness is not permitted to be incurred under Section 4.10
or the Lien is not permitted under the covenant described under Section 4.12,
the Issuer shall be in default of the applicable covenant. The Issuer may not
designate the Co-Issuer as an Unrestricted Subsidiary.
(d) The Issuer may redesignate an Unrestricted Subsidiary as a
Restricted Subsidiary (a "Redesignation") only if:
(1) no Default shall have occurred and be continuing at the time of
and after giving effect to such Redesignation; and
(2) all Liens, Indebtedness and Investments of such Unrestricted
Subsidiary outstanding immediately following such Redesignation would, if
incurred or made at such time, have been permitted to be incurred or made
for all purposes of this Indenture.
(e) All Designations and Redesignations must be evidenced by
resolutions of the Board of Directors of the Issuer, delivered to the Trustee
certifying compliance with the foregoing provisions.
SECTION 4.20. Limitations on Sale and Leaseback Transactions.
The Issuer will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, enter into any Sale and Leaseback Transaction; provided
that the Issuer or any Restricted Subsidiary may enter into a Sale and Leaseback
Transaction if:
(1) the Issuer or such Restricted Subsidiary could have (a) incurred
the Indebtedness attributable to such Sale and Leaseback Transaction
pursuant to Section 4.10 and (b) incurred a Lien to secure such
Indebtedness without equally and ratably securing the Notes pursuant to
Section 4.12;
(2) the gross cash proceeds of such Sale and Leaseback Transaction are
at least equal to the Fair Market Value of the asset that is the subject of
such Sale and Leaseback Transaction; and
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(3) the transfer of assets in such Sale and Leaseback Transaction is
permitted by Section 4.13.
SECTION 4.21. Limitation on Issuances or Sale of Equity Interests of Restricted
Subsidiaries.
The Issuer will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, sell or issue any shares of Equity Interests of any
Restricted Subsidiary except (1) to the Issuer, a Restricted Subsidiary or the
minority stockholders of any Restricted Subsidiary, on a pro rata basis or (2)
to the extent such shares represent directors' qualifying shares or shares
required by applicable law to be held by a Person other than the Issuer or a
Wholly-Owned Restricted Subsidiary. The sale of all the Equity Interests of any
Restricted Subsidiary is permitted by this Section 4.21 but is subject to
Section 4.13.
SECTION 4.22. Business Activities.
The Issuer will not, and will not permit any Restricted Subsidiary to,
engage in any business other than the Permitted Business.
SECTION 4.23. Payments for Consent.
The Issuers will not, and will not permit any of their Subsidiaries
to, directly or indirectly, pay or cause to be paid any consideration to or for
the benefit of any Holder of Notes for or as an inducement to any consent,
waiver or amendment of any of the terms or provisions of this Indenture or the
Notes unless such consideration is offered to be paid and is paid to all Holders
of the Notes that consent, waive or agree to amend in the time frame set forth
in the solicitation documents relating to such consent, waiver or amendment.
SECTION 4.24. Limitation on Activities of the Co-Issuer.
The Co-Issuer shall not hold any material assets, become liable for
any material obligations, engage in any trade or business, or conduct any
business activity, other than (1) the issuance of its Equity Interests to the
Issuer or any Wholly-Owned Restricted Subsidiary of the Issuer, (2) the
incurrence of Indebtedness as a co-obligor or guarantor, as the case may be, of
the Notes, the Credit Facilities and any other Indebtedness that is permitted to
be incurred by the Issuer under Section 4.10; provided that the net proceeds of
such Indebtedness are not retained by the Co-Issuer, and (3) activities
incidental thereto. Neither the Issuer nor any Restricted Subsidiary shall
engage in any transactions with the Co-Issuer in violation of the immediately
preceding sentence.
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ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidations, Etc.
(a) The Issuer will not, directly or indirectly, in a single
transaction or a series of related transactions, (i) consolidate or merge with
or into (other than a merger with a Wholly-Owned Restricted Subsidiary solely
for the purpose of changing the Issuer's jurisdiction of incorporation to
another State of the United States), or sell, lease, transfer, convey or
otherwise dispose of or assign all or substantially all of the assets of the
Issuer and the Restricted Subsidiaries (taken as a whole) or (ii) adopt a Plan
of Liquidation unless, in either case:
(1) either:
(a) the Issuer will be the surviving or continuing Person; or
(b) the Person formed by or surviving such consolidation or
merger or to which such sale, lease, conveyance or other disposition
shall be made (or, in the case of a Plan of Liquidation, any Person to
which assets are transferred) (collectively, the "Successor") is a
corporation, limited liability company or limited partnership
organized and existing under the laws of any State of the United
States of America or the District of Columbia, and the Successor
expressly assumes, by supplemental indenture in form and substance
satisfactory to the Trustee, all of the obligations of the Issuer
under the Notes, this Indenture and the Registration Rights Agreement;
(2) immediately prior to and immediately after giving effect to such
transaction and the assumption of the obligations as set forth in clause
(1)(b) above and the incurrence of any Indebtedness to be incurred in
connection therewith, no Default shall have occurred and be continuing; and
(3) immediately after and giving effect to such transaction and the
assumption of the obligations set forth in clause (1)(b) above and the
incurrence of any Indebtedness to be incurred in connection therewith, and
the use of any net proceeds therefrom on a pro forma basis, the Issuer or
the Successor, as the case may be, (a) could incur $1.00 of additional
Indebtedness pursuant to the Coverage Ratio Exception or (b) shall have a
Consolidated Interest Coverage Ratio greater than the Consolidated Interest
Coverage Ratio of the Issuer immediately prior to such transaction and
assumption.
For purposes of this Section 5.01(a), any Indebtedness of the
Successor which was not Indebtedness of the Issuer immediately prior to the
transaction shall be deemed to have been incurred in connection with such
transaction.
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(b) The Co-Issuer will not, directly or indirectly, in a single
transaction or a series of related transactions, (a) consolidate or merge with
or into, or sell, lease, transfer, convey or otherwise dispose of or assign all
or substantially all of the assets of the Co-Issuer or (b) adopt a Plan of
Liquidation unless, in either case:
(1) either:
(a) the Co-Issuer will be the surviving or continuing Person; or
(b) the Person formed by or surviving such consolidation or
merger or to which such sale, lease, conveyance or other disposition
shall be made is a corporation organized and existing under the laws
of any State of the United States of America or the District of
Columbia, and the Successor expressly assumes, by supplemental
indenture in form and substance satisfactory to the Trustee, all of
the obligations of the Co-Issuer under the Notes, this Indenture and
the Registration Rights Agreement; and
(2) immediately prior to and immediately after giving effect to such
transaction and the assumption of the obligations as set forth in clause
(1)(b) above, no Default shall have occurred and be continuing.
(c) No Guarantor may consolidate with or merge with or into (whether
or not such Guarantor is the surviving Person) another Person, other than the
Issuer, the Co-Issuer or another Guarantor, unless:
(1) either:
(a) such Guarantor will be the surviving or continuing Person; or
(b) the Person formed by or surviving any such consolidation or
merger assumes, by supplemental indenture in form and substance
satisfactory to the Trustee, all of the obligations of such Guarantor
under the Note Guarantee of such Guarantor, this Indenture and the
Registration Rights Agreement; and
(2) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing.
(d) For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries, the Equity Interests of which constitute all or substantially all
of the properties and assets of the Issuer, will be deemed to be the transfer of
all or substantially all of the properties and assets of the Issuer.
(e) Upon any consolidation, combination or merger of the Issuer, the
Co-Issuer or a Guarantor, or any transfer of all or substantially all of the
assets of the Issuer in accordance with the foregoing, in which the Issuer or
such Guarantor is not the continuing obligor
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under the Notes or its Note Guarantee, the surviving entity formed by such
consolidation or into which the Issuer, the Co-Issuer or such Guarantor is
merged or to which the conveyance, lease or transfer is made will succeed to,
and be substituted for, and may exercise every right and power of, the Issuer,
the Co-Issuer or such Guarantor, as the case may be, under this Indenture, the
Notes and the Note Guarantees with the same effect as if such surviving entity
had been named therein as the Issuer, the Co-Issuer or such Guarantor and,
except in the case of a lease, the Issuer, Co-Issuer or such Guarantor, as the
case may be, will be released from the obligation to pay the principal of and
interest on the Notes or in respect of its Note Guarantee, as the case may be,
and all of the Issuer's, Co-Issuer's or such Guarantor's other obligations and
covenants under the Notes, this Indenture and its Note Guarantee, if applicable.
(f) Notwithstanding the foregoing, any Restricted Subsidiary may merge
into the Issuer or another Restricted Subsidiary.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following is an "Event of Default":
(1) failure by the Issuer and the Co-Issuer to pay interest on any of
the Notes when it becomes due and payable and the continuance of any such
failure for 30 days (whether or not such payment is prohibited by the
subordination provisions of this Indenture);
(2) failure by the Issuer and the Co-Issuer to pay the principal on
any of the Notes when it becomes due and payable, whether at Stated
Maturity, upon redemption, upon purchase, upon acceleration or otherwise
(whether or not such payment is prohibited by the subordination provisions
of this Indenture);
(3) failure by the Issuer to comply with Section 5.01 or in respect of
its obligations to make a Change of Control Offer as described under
Section 4.09 (whether or not such performance is prohibited by the
subordination provisions of this Indenture);
(4) failure by the Issuer to comply with Section 4.10 or Section 4.11
and continuance of this failure for 30 days after notice of the failure has
been given to the Issuer by the Trustee or by the Holders of at least 25%
of the aggregate principal amount of the Notes then outstanding;
(5) failure by the Issuer to comply with any other agreement or
covenant in this Indenture and continuance of such failure for 60 days
after notice of such failure has been given to the Issuer by the Trustee or
by the Holders of at least 25% of the aggregate principal amount of the
Notes then outstanding;
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(6) default under any mortgage, indenture or other instrument or
agreement under which there may be issued or by which there may be secured
or evidenced Indebtedness of the Issuer or any Restricted Subsidiary,
whether such Indebtedness now exists or is incurred after the Issue Date,
which default:
(a) is caused by a failure to pay at final maturity (giving
effect to any applicable grace periods and any extensions thereof)
principal on such Indebtedness,
(b) results in the acceleration of such Indebtedness prior to its
express final maturity or
(c) results in the commencement of judicial proceedings to
foreclose upon, or to exercise remedies under applicable law or
applicable security documents to take ownership of, the assets
securing such Indebtedness, and
in each case, the principal amount of such Indebtedness, together with any
other Indebtedness with respect to which an event described in clause (a),
(b) or (c) has occurred and is continuing, aggregates $10.0 million or
more;
(7) one or more judgments or orders that exceed $10.0 million in the
aggregate (net of amounts covered by insurance or bonded) for the payment
of money have been entered by a court or courts of competent jurisdiction
against the Issuer or any Restricted Subsidiary and such judgment or
judgments have not been satisfied, stayed, annulled or rescinded within 60
days of being entered;
(8) the Issuer, the Co-Issuer, any Significant Subsidiary or the
General Partner pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief against it in an
involuntary case,
(c) consents to the appointment of a Custodian of it or for all
or substantially all of its assets, or
(d) makes a general assignment for the benefit of its creditors;
(9) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(a) is for relief against the Issuer, the Co-Issuer, any
Significant Subsidiary or the General Partner as debtor in an
involuntary case,
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(b) appoints a Custodian of the Issuer, the Co-Issuer, any
Significant Subsidiary or the General Partner or a Custodian for all
or substantially all of the assets of the Issuer, any Significant
Subsidiary or the General Partner, or
(c) orders the liquidation of the Issuer, the Co-Issuer, any
Significant Subsidiary or the General Partner,
and the order or decree remains unstayed and in effect for 60 days; or
(10) any Note Guarantee of any Significant Subsidiary ceases to be in
full force and effect (other than in accordance with the terms of such Note
Guarantee and this Indenture) or is declared in a judicial proceeding null
and void and unenforceable or found in a judicial proceeding to be invalid
or any Guarantor denies its liability under its Note Guarantee (other than
by reason of release of a Guarantor from its Note Guarantee in accordance
with the terms of this Indenture and the Note Guarantee).
SECTION 6.02. Acceleration.
(a) If an Event of Default specified in clause (8) or (9) of Section
6.01 with respect to the Issuer, the Co-Issuer or the General Partner occurs,
all outstanding Notes shall become due and payable without any further action or
notice. If an Event of Default (other than an Event of Default specified in
clause (8) or (9) of Section 6.01 with respect to the Issuer, the Co-Issuer or
the General Partner) shall have occurred and be continuing under this Indenture,
the Trustee, by written notice to the Issuer, or the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding, by written notice to
the Issuer and the Trustee, may declare (an "acceleration declaration") all
amounts owing under the Notes to be due and payable immediately. The aggregate
principal of and accrued and unpaid interest on the outstanding Notes shall
become due and payable (a) if there is no Indebtedness outstanding under any
Credit Facility at such time, immediately and (b) if otherwise, upon the earlier
of (x) the final maturity (after giving effect to any applicable grace period or
extensions thereof) or an acceleration of any Indebtedness under any Credit
Facility prior to the express final Stated Maturity thereof and (y) five
business days after the Representative under each Credit Facility receives the
acceleration declaration, but, in the case of this clause (b) only, if such
Event of Default is then continuing; provided, however, that after such
acceleration, but before a judgment or decree based on acceleration, the Holders
of a majority in aggregate principal amount of such outstanding Notes may
rescind and annul such acceleration:
(1) if the rescission would not conflict with any judgment or decree;
(2) if all existing Defaults have been cured or waived except
nonpayment of principal or interest that has become due solely because of
this acceleration;
(3) to the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal, which has become
due otherwise than by such declaration of acceleration, has been paid;
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(4) if the Issuer has paid to the Trustee its reasonable compensation
and reimbursed the Trustee of its expenses, disbursements and advances; and
(5) in the event of a cure or waiver of a Default of the type set
forth in Section 6.01(8) or (9), the Trustee shall have received an
Officers' Certificate and an Opinion of Counsel that such Default has been
cured or waived.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto.
(b) The Issuers shall provide prompt written notice to the holders of
Senior Debt and Guarantor Senior Debt of any acceleration pursuant to Section
6.02(a).
SECTION 6.03. Other Remedies.
If a 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 interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon a Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Default. No remedy is exclusive of any other remedy. All
available remedies are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 2.09, 6.07 and 9.02, the Holders of a majority in
principal amount of the outstanding Notes (which may include consents obtained
in connection with a tender offer or exchange offer of Notes) by notice to the
Trustee may waive an existing Default and its consequences, except a Default in
the payment of principal of or interest on any Note as specified in Section
6.01(1) or (2). The Issuers shall deliver to the Trustee an Officers'
Certificate stating that the requisite percentage of Holders have consented to
such waiver and attaching copies of such consents. When a Default is waived, it
is cured and ceases.
SECTION 6.05. Control by Majority.
The Holders of not less than a majority in principal amount of the
outstanding Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. Subject to Section 7.01, however, the Trustee may refuse
to follow any direction that conflicts with any law or this Indenture, that the
Trustee determines may be unduly prejudicial to the rights of another Holder, or
that may involve the Trustee in personal liability; provided that the Trustee
may take any other action deemed proper by the Trustee which is not inconsistent
with such direction.
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In the event the Trustee takes any action or follows any direction
pursuant to this Indenture, the Trustee shall be entitled to indemnification
against any loss or expense caused by taking such action or following such
direction.
SECTION 6.06. Limitation on Suits.
No Holder will have any right to institute any proceeding with respect
to this Indenture or for any remedy thereunder, unless the Trustee:
(1) has failed to act for a period of 60 days after receiving written
notice of a continuing Event of Default by such Holder and a request to act
by Holders of at least 25% in aggregate principal amount of Notes
outstanding;
(2) has been offered indemnity satisfactory to it in its reasonable
judgment; and
(3) has not received from the Holders of a majority in aggregate
principal amount of the outstanding Notes a direction inconsistent with
such request.
However, such limitations do not apply to a suit instituted by a Holder of any
Note for enforcement of payment of the principal of or interest on such Note on
or after the due date therefor (after giving effect to the grace period
specified in clause (1) of Section 6.01).
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of and interest on a Note, on or
after the respective due dates therefor, or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If a Default in payment of principal or interest specified in Section
6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its
own name and as trustee of an express trust against the Issuers or any other
obligor on the Notes for the whole amount of principal and accrued interest and
fees 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 per annum borne by the Notes and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
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SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee 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 Holders allowed in any
judicial proceedings relating to the Issuers, their creditors or their 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,
and any Custodian in any such judicial proceedings is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay to
the Trustee any amount due to it for the compensation, expenses, disbursements
and advances of the Trustee, its agent and counsel, and any other amounts due
the Trustee under Section 7.07. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf of
any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
The Trustee shall be entitled to participate as a member of any official
committee of creditors in the matters as it deems necessary or advisable.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this Article
Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for interest accrued on the Notes, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for interest;
Third: to Holders for principal amounts due and unpaid on the Notes,
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Notes for principal; and
Fourth: to the Issuers or, if applicable, the Guarantors, as their
respective interests may appear.
The Trustee, upon prior notice to the Issuers, may fix a record date
and payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as 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
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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 6.07, or a suit by a Holder or Holders of
more than 10% in principal amount of the outstanding Notes.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture and use
the same degree of care and skill in their exercise as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of a Default:
(1) The Trustee need perform only those duties as are specifically set
forth herein or in the Trust Indenture Act and no duties, covenants,
responsibilities or obligations shall be implied in this Indenture 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 certificates (including Officers'
Certificates) or opinions (including Opinions of Counsel) furnished to the
Trustee and conforming to the requirements of this Indenture. However, 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
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein, 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 Section 7.01(b).
(2) 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 Section 6.05.
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(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 duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to this Section
7.01.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuers. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
(g) In the absence of bad faith, negligence or willful misconduct on
the part of the Trustee, the Trustee shall not be responsible for the
application of any money by any Paying Agent other than the Trustee.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely conclusively on any document believed by it
to be genuine and to have been signed or presented by the proper Person.
The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate and an Opinion of Counsel, which shall conform to the
provisions of Section 12.05. The Trustee shall not be liable for any action
it takes or omits to take in good faith in reliance on such certificate or
opinion.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent (other than an
agent who is an employee of the Trustee) appointed with due care.
(d) 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.
(e) 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.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to
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the Trustee reasonable security or indemnity satisfactory to it against the
costs, expenses and liabilities which may be incurred therein or thereby.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate (including any
Officers' Certificate), statement, instrument, opinion (including any
Opinion of Counsel), notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled, upon reasonable notice to
the Issuers, to examine the books, records, and premises of the Issuers,
personally or by agent or attorney at the sole cost of the Issuers.
(h) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(i) The permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as duties.
(j) Except with respect to Section 4.01, the Trustee shall have no
duty to inquire as to the performance of the Issuers with respect to the
covenants contained in Article 4. In addition, the Trustee shall not be
deemed to have knowledge of an Event of Default except (i) any Default or
Event of Default occurring pursuant to Sections 4.01, 6.01(1) or 6.01(2) or
(ii) any Default or Event of Default of which the Trustee shall have
received written notification or obtained actual knowledge.
(k) The rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its
capacities hereunder, and to each agent, custodian and other Person
employed to act hereunder.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuers, their
Subsidiaries or their respective Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuers' use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuers in this Indenture or any
document issued in connection with the sale of Notes or any statement in the
Notes other than the Trustee's certificate of authentication. The Trustee makes
no representations with respect to the effectiveness or adequacy of this
Indenture.
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SECTION 7.05. Notice of Default.
If a Default occurs and is continuing and the Trustee receives actual
notice of such Default, the Trustee shall mail to each Holder notice of the
uncured Default within 30 days after such Default occurs. Except in the case of
a Default in payment of principal of, or interest on, any Note, including an
accelerated payment and the failure to make a payment on the Change of Control
Payment Date pursuant to a Change of Control Offer or the Net Proceeds Payment
Date pursuant to an Net Proceeds Offer, or a Default in complying with the
provisions of Article Five, the Trustee may withhold the notice if and so long
as the Board of Directors, the executive committee, or a trust committee of
directors and/or Responsible Officers, of the Trustee in good faith determines
that withholding the notice is in the interest of the Holders.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after each May 15, beginning with May 15, 2004, the
Trustee shall, to the extent that any of the events described in Trust Indenture
Act (S) 313(a) occurred within the previous twelve months, but not otherwise,
mail to each Holder a brief report dated as of such date that complies with
Trust Indenture Act (S) 313(a). The Trustee also shall comply with Trust
Indenture Act (S)(S) 313(b), 313(c) and 313(d).
A copy of each report at the time of its mailing to Holders shall be
mailed to the Issuers and filed with the SEC and each securities exchange, if
any, on which the Notes are listed.
The Issuers shall notify the Trustee if the Notes become listed on any
securities exchange or of any delisting thereof and the Trustee shall comply
with Trust Indenture Act (S) 313(d).
SECTION 7.07. Compensation and Indemnity.
The Issuers shall pay to the Trustee from time to time such
compensation as the Issuers and the Trustee shall from time to time agree in
writing for its services hereunder. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuers
shall reimburse the Trustee upon request for all reasonable disbursements,
expenses and advances (including reasonable fees and expenses of counsel)
incurred or made by it in addition to the compensation for its services, except
any such disbursements, expenses and advances as may be attributable to the
Trustee's negligence, bad faith or willful misconduct. Such expenses shall
include the reasonable fees and expenses of the Trustee's agents and counsel.
The Issuers shall indemnify each of the Trustee or any predecessor
Trustee and its agents, employees, officers, stockholders and directors for, and
hold them harmless against, any and all loss, damage, claims including taxes
(other than taxes based upon, measured by or determined by the income of the
Trustee), liability or expense incurred by them except for such actions to the
extent caused by any negligence, bad faith or willful misconduct on their part,
arising
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out of or in connection with the acceptance or administration of this trust
including the reasonable costs and expenses of defending themselves against or
investigating any claim or liability in connection with the exercise or
performance of any of the Trustee's rights, powers or duties hereunder. The
Trustee shall notify the Issuers promptly of any claim asserted against the
Trustee or any of its agents, employees, officers, stockholders and directors
for which it may seek indemnity. The Issuers may, subject to the approval of the
Trustee (which approval shall not be unreasonably withheld), defend the claim
and the Trustee shall cooperate in the defense. The Trustee and its agents,
employees, officers, stockholders and directors subject to the claim may have
separate counsel and the Issuers shall pay the reasonable fees and expenses of
such counsel; provided, however, that the Issuers will not be required to pay
such fees and expenses if, subject to the approval of the Trustee (which
approval shall not be unreasonably withheld), it assumes the Trustee's defense
and there is no conflict of interest between the Issuers and the Trustee and its
agents, employees, officers, stockholders and directors subject to the claim in
connection with such defense as reasonably determined by the Trustee. The
Issuers need not pay for any settlement made without its written consent. The
Issuers need not reimburse any expense or indemnify against any loss or
liability to the extent incurred by the Trustee through its negligence, bad
faith or willful misconduct.
To secure the Issuers' payment obligations in this Section 7.07, the
Trustee shall have a senior claim prior to the Notes against all money or
property held or collected by the Trustee, in its capacity as Trustee. The
obligations of the Issuers and the Guarantors under this Section shall not be
subordinated to the payment of Senior Debt pursuant to Article Ten or Section
11.02 except assets or money held in trust to pay principal of or interest on
particular Notes.
When the Trustee incurs expenses or renders services after a Default
specified in Section 6.01(8) or (9) occurs, such expenses and the compensation
for such services shall be paid to the extent allowed under any Bankruptcy Law.
Notwithstanding any other provision in this Indenture, the foregoing
provisions of this Section 7.07 shall survive the satisfaction and discharge of
this Indenture or the appointment of a successor Trustee.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Issuers in
writing. The Holders of a majority in principal amount of the outstanding Notes
may remove the Trustee by so notifying the Issuers and the Trustee and may
appoint a successor Trustee. The Issuers may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(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
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(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Notes may appoint a successor Trustee to replace the successor Trustee
appointed by the Issuers.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Immediately after that,
the retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.07, all property held by it as Trustee to the
successor Trustee, subject to the Lien provided in Section 7.07, 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
Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the
Holders of at least 10% in principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee at the expense of the Issuers.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Issuers' obligations under Section 7.07 shall continue for the benefit
of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; provided that such
corporation shall be otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of Trust Indenture Act (S)(S) 310(a)(1), 310(a)(2) and 310(a)(5).
The Trustee shall have a combined capital and surplus of at least $150,000,000
as set forth in its most recent published annual report of condition. In
addition, if the Trustee is a corporation included in a bank holding company
system, the Trustee, independently of the bank holding company, shall meet the
capital requirements of Trust Indenture Act (S) 310(a)(2). The Trustee shall
comply with Trust Indenture Act (S) 310(b); provided, however, that there shall
be excluded from the operation of Trust Indenture
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Act (S) 310(b)(1) any indenture or indentures under which other securities, or
certificates of interest or participation in other securities, of the Issuers
are outstanding, if the requirements for such exclusion set forth in Trust
Indenture Act (S) 310(b)(1) are met. The provisions of Trust Indenture Act (S)
310 shall apply to the Issuers and any other obligor of the Notes.
SECTION 7.11. Preferential Collection of Claims Against the Issuers.
The Trustee, in its capacity as Trustee hereunder, shall comply with
Trust Indenture Act (S) 311(a), excluding any creditor relationship listed in
Trust Indenture Act (S) 311(b). A Trustee who has resigned or been removed shall
be subject to Trust Indenture Act (S) 311(a) to the extent indicated.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of the Issuers' Obligations.
The Issuer may terminate its obligations under the Notes and this
Indenture and the Indenture shall cease to be of further effect, except those
obligations referred to in the penultimate paragraph of this Section 8.01, if
all Notes previously authenticated and delivered (other than destroyed, lost or
stolen Notes which have been replaced or paid) have been delivered to the
Trustee for cancellation and the Issuer has paid all sums payable by it
hereunder, or if:
(1) all the Notes that have been authenticated and delivered (except
lost, stolen or destroyed Notes which have been replaced or paid and Notes
for whose payment money has been deposited in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer or discharged
from this trust) have been delivered to the Trustee for cancellation, or
(2) (a) all Notes not delivered to the Trustee for cancellation
otherwise have become due and payable or have been called for redemption
pursuant to Section 5 or Section 6 of the Notes and the Issuer has
irrevocably deposited or caused to be deposited with the Trustee trust
funds in trust in an amount of money sufficient to pay and discharge the
entire Indebtedness (including all principal and accrued interest) on the
Notes not theretofore delivered to the Trustee for cancellation,
(b) the Issuer and the Co-Issuer have paid all sums payable by
them under the Indenture,
(c) the Issuer and the Co-Issuer have delivered irrevocable
instructions to the Trustee to apply the deposited money toward the
payment of the Notes at maturity or on the date of redemption, as the
case may be, and
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(d) the Holders have a valid, perfected, exclusive security
interest in this trust.
In addition, the Issuer must deliver an Officer's Certificate and an opinion of
counsel stating that all conditions precedent to satisfaction and discharge have
been complied with.
Subject to the next sentence and notwithstanding the foregoing
paragraph, the Issuers' obligations in Sections 2.05, 2.06, 2.07, 2.08, 4.01,
4.02, 4.03 (as to legal existence of the Issuers only), 7.07, 8.05 and 8.06
shall survive until the Notes are no longer outstanding pursuant to the last
paragraph of Section 2.08. After the Notes are no longer outstanding, the
Issuers' obligations in Sections 7.07, 8.05 and 8.06 shall survive.
After such delivery or irrevocable deposit, the Trustee upon request
shall acknowledge in writing the discharge of the Issuers' obligations under the
Notes and this Indenture except for those surviving obligations specified above.
SECTION 8.02. Legal Defeasance and Covenant Defeasance.
(a) The Issuers may, at their option and at any time, elect to have
either paragraph (b) or (c) below be applied to all outstanding Notes upon
compliance with the conditions set forth in Section 8.03.
(b) Upon the Issuer's exercise under paragraph (a) hereof of the
option applicable to this paragraph (b), the Issuer, the Co-Issuer and the
Guarantor shall, subject to the satisfaction of the conditions set forth in
Section 8.03, be deemed to have been discharged from their obligations with
respect to all outstanding Notes on the date the conditions set forth below are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance
means that the Issuers and the Guarantors shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Notes and the
Note Guarantees, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.04 hereof and the other Sections of this Indenture
referred to in (i) and (ii) below, and to have satisfied all its other
obligations under such Notes and this Indenture and the Guarantors shall be
deemed to have satisfied all of their obligations under the Note Guarantees and
this Indenture (and the Trustee, on demand of and at the expense of the Issuers,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder:
(i) the rights of Holders of outstanding Notes to receive, solely from
the trust fund described in Section 8.04 hereof, and as more fully set
forth in such Section 8.04, payments in respect of the principal of,
premium, if any, and interest on such Notes when such payments are due;
(ii) the Issuers obligations with respect to such Notes under Article
Two and Section 4.02 hereof;
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(iii) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Issuers' obligations in connection therewith; and
(iv) this Article Eight.
Subject to compliance with this Article Eight, the Issuer may exercise
its option under this Section 8.02(b) notwithstanding the prior exercise of its
option under Section 8.02(c) hereof.
(c) Upon the Issuers' exercise under paragraph (a) hereof of the
option applicable to this paragraph (c), the Issuers and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.03 hereof,
be released from their respective obligations under the covenants contained in
Sections 4.03 (other than with respect to the legal existence of the Issuers),
4.04, 4.05, 4.07 and 4.09 through 4.24 and clause (3) of Section 5.01(a) hereof
with respect to the outstanding Notes on and after the date the conditions set
forth in Section 8.03 are satisfied (hereinafter, "Covenant Defeasance"), and
the Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Issuers and the Guarantors may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute an Event of Default under Section
6.01 hereof, but, except as specified above, the remainder of this Indenture and
such Notes shall be unaffected thereby. In addition, upon the Issuers' exercise
under paragraph (a) hereof of the option applicable to this paragraph (c),
subject to the satisfaction of the conditions set forth in Section 8.03 hereof,
clauses (3), (4), (5), (6) and (7) of Section 6.01 hereof shall not constitute
Events of Default.
SECTION 8.03. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.02(b) or 8.02(c) hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) the Issuer must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, U.S. Legal Tender, U.S. Government
Obligations or a combination thereof, in such amounts as will be sufficient
(without reinvestment), in the opinion of a nationally recognized firm of
independent public accountants selected by the Issuer, to pay the principal
of and interest on the Notes on the stated date for payment or on the
redemption date of the principal or installment of principal of or interest
on the Notes, and the Holders must have a valid, perfected, exclusive
security interest in such trust,
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(2) in the case of Legal Defeasance, the Issuer shall have delivered
to the Trustee an Opinion of Counsel in the United States confirming that:
(a) the Issuer has received from, or there has been published by
the Internal Revenue Service, a ruling, or
(b) since the date of the Indenture, there has been a change in
the applicable U.S. federal income tax law,
in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders will not recognize income, gain or
loss for U.S. federal income tax purposes as a result of such Legal
Defeasance and will be subject to U.S. federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such Legal Defeasance had not occurred,
(3) in the case of Covenant Defeasance, the Issuer shall have
delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders will not
recognize income, gain or loss for U.S. federal income tax purposes as a
result of such Covenant Defeasance and will be subject to U.S. federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to U.S. federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant
Defeasance had not occurred,
(4) no Default shall have occurred and be continuing on the date of
such deposit (other than a Default resulting from the borrowing of funds to
be applied to such deposit and the grant of any Lien securing such
borrowing),
(5) the Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a Default under (other than a Default
resulting solely from the borrowing of funds to be applied to such deposit
and the grant of any Lien on such deposit in favor of the Trustee and/or
the Holders), any other material agreement or instrument to which the
Issuer or any of its Subsidiaries is a party or by which the Issuer or any
of its Subsidiaries is bound,
(6) the Issuer shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by it with the intent of
defeating, hindering, delaying or defrauding any other of its creditors or
others, and
(7) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that the conditions
provided for in, in the case of the Officers' Certificate, clauses (1)
through (6) and, in the case of the Opinion of Counsel, clauses (1) (with
respect to the validity and perfection of the security interest), (2)
and/or (3), as applicable, and (5) of this paragraph have been complied
with.
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SECTION 8.04. Application of Trust Money.
The Trustee or Paying Agent shall hold in trust U.S. Legal Tender and
U.S. Government Obligations deposited with it pursuant to this Article Eight,
and shall apply the deposited U.S. Legal Tender and the money from U.S.
Government Obligations in accordance with this Indenture to the payment of
principal of and interest on the Notes. The Trustee shall be under no obligation
to invest said U.S. Legal Tender and U.S. Government Obligations except as it
may agree with the Issuers.
The Issuers shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Legal Tender and U.S.
Government Obligations deposited pursuant to Section 8.03 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon the Issuer's
request any U.S. Legal Tender and U.S. Government Obligations held by it as
provided in Section 8.03 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 that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
SECTION 8.05. Repayment to the Issuers.
Subject to this Article Eight, the Trustee and the Paying Agent shall
promptly pay to the Issuers upon request any excess U.S. Legal Tender and U.S.
Government Obligations held by them at any time and thereupon shall be relieved
from all liability with respect to such money. The Trustee and the Paying Agent
shall pay to the Issuers upon request any money held by them for the payment of
principal or interest that remains unclaimed for two years; provided that the
Trustee or such Paying Agent, before being required to make any payment, may at
the expense of the Issuers cause to be published once in a newspaper of general
circulation in the City of New York or mail to each Holder entitled to such
money notice that such money remains unclaimed and that after a date specified
therein which shall be at least 30 days from the date of such publication or
mailing any unclaimed balance of such money then remaining will be repaid to the
Issuers. After payment to the Issuers, Holders entitled to such money must look
to the Issuers for payment as general creditors unless an applicable law
designates another Person.
SECTION 8.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. Legal
Tender and U.S. Government Obligations in accordance with this Article Eight 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 Issuers' obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article Eight until such time as the Trustee or Paying Agent is permitted
to apply all such U.S. Legal
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Tender and U.S. Government Obligations in accordance with this Article Eight;
provided that if the Issuers have made any payment of interest on or principal
of any Notes because of the reinstatement of its obligations, the Issuers shall
be subrogated to the rights of the Holders of such Notes to receive such payment
from the U.S. Legal Tender and U.S. Government Obligations held by the Trustee
or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
(a) Subject to Section 9.03, the Issuers, the Guarantors and the
Trustee, together, may amend or supplement this Indenture, the Notes or the Note
Guarantees without notice to or consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(3) to provide for the assumption of the obligations of the Issuer and
the Co-Issuer to Holders of Notes in the case of a merger, consolidation or
sale of all or substantially all assets, in accordance with Article Five;
(4) to release any Guarantor from any of its obligations under its
Note Guarantee or this Indenture (to the extent permitted by this
Indenture);
(5) to make any change that would not materially adversely affect the
rights of any Holder; or
(6) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act;
provided that the Issuers have delivered to the Trustee an Opinion of Counsel
and an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
(a) Subject to Sections 6.07 and 9.03, the Issuers, the Guarantors and
the Trustee, together, with the written consent of the Holder or Holders of a
majority in aggregate principal amount of the outstanding Notes (which may
include consents obtained in connection with a tender offer or exchange offer of
Notes), may amend or supplement this Indenture, the Notes or the Note
Guarantees, without notice to any other Holders. Subject to Sections 6.07 and
9.03, the Holder or Holders of a majority in aggregate principal amount of the
outstanding Notes
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may waive compliance with any provision of this Indenture, the Notes or the Note
Guarantees without notice to any other Holders.
(b) Notwithstanding Section 9.02(a), subject to Section 9.02(c)(3), no
such amendment or waiver may, without the consent of the Holders of two-thirds
in aggregate principal amount of Notes then outstanding, amend the obligations
of the Issuer and the Co-Issuer under Section 4.09 or the related definitions
that adversely affects the rights of any Holder.
(c) Without the consent of each Holder affected, no amendment or
waiver may:
(1) change the maturity of any Note;
(2) reduce the amount, extend the due date or otherwise affect the
terms of any scheduled payment of interest on or principal of the Notes;
(3) reduce any premium payable upon optional redemption of the Notes,
change the date on which any Notes are subject to redemption or otherwise
alter the provisions with respect to the redemption of the Notes (other
than provisions of Section 4.09 and Section 4.13, except that if a Change
of Control has occurred, no amendment or other modification of the
obligation of the Issuer to make a Change of Control Offer relating to such
Change of Control shall be made without the consent of each Holder of the
Notes affected);
(4) make any Note payable in money or currency other than that stated
in the Notes;
(5) modify or change any provision of the Indenture or the related
definitions affecting the subordination of the Notes or any Note Guarantee
in a manner that adversely affects the Holders;
(6) reduce the percentage of Holders necessary to consent to an
amendment or waiver to the Indenture of the Notes;
(7) impair the rights of Holders to receive payments of principal of
or interest on the Notes;
(8) release any Guarantor from any of its obligations under its Note
Guarantee or the Indenture, except as permitted by the Indenture; or
(9) make any change in these amendment and waiver provisions.
(d) It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver but it shall be sufficient if such consent approves the
substance thereof.
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(e) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Issuers shall mail to the Holders affected thereby a
notice briefly describing the 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 amendment, supplement or
waiver.
SECTION 9.03. Effect on Senior Debt.
No amendment of, or supplement or waiver to, this Indenture shall
adversely affect the rights of any holder of Senior Debt or Guarantor Senior
Debt under Article Ten and Section 11.02 and the defined terms as used therein
without the consent of such holder or its Representative.
SECTION 9.04. Compliance with the Trust Indenture Act.
From the date on which this Indenture is qualified under the Trust
Indenture Act, every amendment, waiver or supplement of this Indenture, the
Notes or the Note Guarantees shall comply with the Trust Indenture Act as then
in effect.
SECTION 9.05. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder or subsequent Holder may revoke the consent as to
his Note or portion of his Note by notice to the Trustee or the Issuers received
before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of Notes have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
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 amendment,
supplement or waiver which record date shall be at least 30 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly designated proxies),
and only those Persons, shall be entitled 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. The Issuers shall inform the Trustee in writing of the fixed
record date if applicable.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (1)
through (9) of Section 9.02(c), in which case, the amendment, supplement or
waiver shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note; provided that any such waiver shall not impair or
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affect the right of any Holder to receive payment of principal of and interest
on a Note, on or after the respective due dates therefor, or to bring suit for
the enforcement of any such payment on or after such respective dates without
the consent of such Holder.
SECTION 9.06. Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a Note, the
Issuers may require the Holder of the Note to deliver it to the Trustee. The
Issuers shall provide the Trustee with an appropriate notation on the Note about
the changed terms and cause the Trustee to return it to the Holder at the
Issuers' expense. Alternatively, if the Issuers or the Trustee so determines,
the Issuers in exchange for the Note shall issue and the Trustee shall
authenticate a new Note that reflects the changed terms. Failure to make the
appropriate notation or issue a new Note shall not affect the validity and
effect of such amendment, supplement or waiver.
SECTION 9.07. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and constituted the legal, valid and binding obligations of the
Issuers enforceable in accordance with its terms. Such Opinion of Counsel shall
be at the expense of the Issuers.
ARTICLE TEN
SUBORDINATION OF NOTES
SECTION 10.01. Notes Subordinated to Senior Debt.
Anything herein to the contrary notwithstanding, each of the Issuers,
for itself and its successors, and each Holder, by his or her acceptance of
Notes, agrees that the payment of all Obligations owing to the Holders in
respect of the Notes is subordinated, to the extent and in the manner provided
in this Article Ten, to the prior payment in full of all Senior Debt in cash,
Cash Equivalents or other cash equivalents reasonably acceptable to the holders
of such Senior Debt, whether outstanding on the Issue Date or thereafter
incurred. Notwithstanding anything in this Article 10 to the contrary, payments
and distributions (A) of Permitted Junior Securities and (B) made relating to
the Notes from the trust established pursuant to Article Eight shall not be so
subordinated in right of payment, so long as, with respect to (B), (i) the
conditions specified in Article Eight (without any waiver or modification of the
requirement that the deposits pursuant thereto do not conflict with the terms of
the Credit Facilities or any other Senior Debt) are satisfied on the date of any
deposit pursuant to said trust and (ii) such payments and distributions did not
violate the provisions of this Article Ten or Section 11.02 of this Indenture
when made.
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This Article Ten shall constitute a continuing offer to all Persons
who become holders of, or continue to hold, Senior Debt, such provisions are
made for the benefit of the holders of Senior Debt and such holders are made
obligees hereunder and any one or more of them may enforce such provisions.
SECTION 10.02. Suspension of Payment When Senior Debt Is in Default.
(a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by declaration or otherwise, of any
principal of, interest on, unpaid drawings for letters of credit issued in
respect of, or fees with respect to, any Designated Senior Debt (a "Payment
Default"), then no payment or distribution of any kind or character shall be
made by or on behalf of the Issuers or any other Person on its or their behalf
with respect to any Obligations on or relating to the Notes or to acquire any of
the Notes for cash or assets or otherwise.
(b) If any other event of default (other than a Payment Default)
occurs and is continuing with respect to any Designated Senior Debt (as such
event of default is defined in the instrument creating or evidencing such
Designated Senior Debt) permitting the holders of such Designated Senior Debt
then outstanding to accelerate the maturity thereof (a "Non-payment Default")
and if the Representative for the respective issue of Designated Senior Debt
gives notice of the Non-Payment Default to the Trustee stating that such notice
is a payment blockage notice (a "Payment Blockage Notice"), then during the
period (the "Payment Blockage Period") beginning upon the delivery of such
Payment Blockage Notice and ending on the earliest of (1) the date on which all
such nonpayment defaults are cured or waived, (2) 179 days after the date on
which the applicable Payment Blockage Notice is received or (3) the date on
which the Trustee receives notice from the Representative for such Designated
Senior Debt rescinding the Payment Blockage Notice (unless the maturity of any
Designated Senior Debt has been accelerated), neither the Issuers nor any other
Person on their behalf shall (x) make any payment of any kind or character with
respect to any Obligations on or with respect to the Notes or (y) acquire any of
the Notes for cash or assets or otherwise. Notwithstanding anything herein to
the contrary, (x) in no event will a Payment Blockage Period extend beyond 179
days from the date the applicable Payment Blockage Notice is received by the
Trustee and (y) only one such Payment Blockage Period may be commenced within
any 360 consecutive days. For all purposes of this Section 10.02(b), no
Non-Payment Default which existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to the Designated
Senior Debt shall be, or be made, the basis for the commencement of a second
Payment Blockage Period by the Representative of such Designated Senior Debt
whether or not within a period of 360 consecutive days, unless such Non-Payment
Default shall have been cured or waived for a period of not less than 90
consecutive days. Any subsequent action, or any breach of any financial
covenants for a period ending after the date of commencement of such Payment
Blockage Period that, in either case, would give rise to a Non-Payment Default
pursuant to any provisions under which a Non-Payment Default previously existed
or was continuing shall constitute a new Non-Payment Default for this purpose.
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(c) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by the foregoing provisions of this Section 10.02, such payment shall be held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Debt (pro rata to such holders on the basis of the respective amount of
Senior Debt held by such holders) or their respective Representatives, as their
respective interests may appear. The Trustee shall be entitled to rely on
information regarding amounts outstanding on the Senior Debt, if any, received
from the holders of the Senior Debt (or their Representatives).
Nothing contained in this Article Ten shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Section 6.02 or to pursue any rights or remedies
hereunder; provided that all Senior Debt thereafter due or declared to be due
shall first be paid in full in cash, Cash Equivalents or other cash equivalents
reasonably acceptable to the holders of such Senior Debt before the Holders are
entitled to receive any payment of any kind or character with respect to
Obligations on the Notes.
SECTION 10.03. Notes Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of the Issuer or the Co-Issuer.
(a) Upon any payment or distribution of assets of the Issuer or
Co-Issuer of any kind or character, whether in cash, assets or securities, to
creditors upon any total or partial liquidation, dissolution, winding-up,
assignment for the benefit of creditors or marshaling of assets and liabilities
of the Issuer or Co-Issuer or in a bankruptcy, reorganization, insolvency,
receivership or other similar proceeding relating to the Issuer or the Co-Issuer
or their assets, whether voluntary or involuntary, all Obligations due or to
become due upon all Senior Debt shall first be paid in full in cash, Cash
Equivalents or other cash equivalents reasonably acceptable to the holders of
such Senior Debt, or such payment duly provided for to the satisfaction of the
holders of Senior Debt, before any payment or distribution of any kind or
character is made on account of any Obligations on or relating to the Notes, or
for the acquisition of any of the Notes for cash or assets or otherwise. Upon
any such dissolution, winding-up, liquidation, reorganization, receivership or
similar proceeding, any payment or distribution of assets of the Issuer or
Co-Issuer of any kind or character, whether in cash, assets or securities, to
which the Holders of the Notes or the Trustee under this Indenture would be
entitled, except for the provisions hereof, shall be paid by the Issuer or
Co-Issuer or by any receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Holders or by the
Trustee under this Indenture if received by them, directly to the holders of
Senior Debt (pro rata to such holders on the basis of the respective amounts of
Senior Debt held by such holders) or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any of such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of Senior Debt remaining unpaid until all such Senior
Debt has been paid in full in cash or Cash Equivalents after giving effect to
any concurrent payment, distribution or provision therefor to or for the holders
of Senior Debt.
(b) To the extent any payment of Senior Debt (whether by or on behalf
of the Issuers, as proceeds of security or enforcement of any right of setoff or
otherwise) is declared to
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be fraudulent or preferential, set aside or required to be paid to any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar Person under
any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then, if such payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person, the Senior
Debt or part thereof originally intended to be satisfied shall be deemed to be
reinstated and outstanding as if such payment had not occurred.
It is further agreed that any diminution (whether pursuant to court
decree or otherwise, including without limitation for any of the reasons
described in the preceding sentence) of the Issuers' obligation to make any
distribution or payment pursuant to any Senior Debt, except to the extent such
diminution occurs by reason of the repayment (which has not been disgorged or
returned) of such Senior Debt in cash, Cash Equivalents or other cash
equivalents reasonably acceptable to the holders of such Senior Debt, shall have
no force or effect for purposes of the subordination provisions contained in
this Article Ten, with any turnover of payments as otherwise calculated pursuant
to this Article Ten to be made as if no such diminution had occurred.
(c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Issuer or the Co-Issuer of any kind or character,
whether in cash, assets or securities, shall be received by any Holder when such
payment or distribution is prohibited by this Section 10.03, such payment or
distribution shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Debt (pro rata to such holders on the
basis of the respective amount of Senior Debt held by such holders) or their
respective Representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of Senior Debt
remaining unpaid until all such Senior Debt has been paid in full in cash, Cash
Equivalents or other cash equivalents reasonably acceptable to the holders of
such Senior Debt, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
(d) The consolidation of the Issuer or Co-Issuer with, or the merger
of the Issuer or Co-Issuer with or into, another Person or the liquidation or
dissolution of the Issuer or Co-Issuer following the conveyance or transfer of
all or substantially all of its assets, to another Person upon the terms and
conditions provided in Article Five hereof and as long as permitted under the
terms of the Senior Debt shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section if such other
Person shall, as a part of such consolidation, merger, conveyance or transfer,
assume the Issuer's or Co-Issuer's obligations hereunder in accordance with
Article Five hereof.
SECTION 10.04. Payments May Be Made Prior to Dissolution.
Nothing contained in this Article Ten or elsewhere in this Indenture
shall prevent (i) the Issuers, except under the conditions described in Sections
10.02 and 10.03, from making payments at any time for the purpose of making
payments of principal of and interest on the Notes, or from depositing with the
Trustee any moneys for such payments, or (ii) in the absence
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of actual knowledge by the Trustee that a given payment would be prohibited by
Section 10.02 or 10.03, the application by the Trustee of any moneys deposited
with it for the purpose of making such payments of principal of, and interest
on, the Notes to the Holders entitled thereto unless at least two Business Days
prior to the date upon which such payment would otherwise become due and payable
a Responsible Officer of the Trustee shall have actually received the written
notice provided for in the first sentence of Section 10.02(b) or in Section
10.07 (provided that, notwithstanding the foregoing, the Holders receiving any
payments made in contravention of Section 10.02 and/or 10.03 (and the respective
such payments) shall otherwise be subject to the provisions of Section 10.02 and
Section 10.03). The Issuers shall give prompt written notice to the Trustee of
any dissolution, winding-up, liquidation or reorganization of the Issuer or
Co-Issuer, although any delay or failure to give any such notice shall have no
effect on the subordination provisions contained herein.
SECTION 10.05. Holders To Be Subrogated to Rights of Holders of Senior Debt.
Subject to the payment in full of all Senior Debt in cash, Cash
Equivalents or other cash equivalents reasonably acceptable to the holders of
such Senior Debt, the Holders of the Notes shall be subrogated to the rights of
the holders of Senior Debt to receive payments or distributions of cash, assets
or securities of the Issuer or Co-Issuer applicable to the Senior Debt until the
Notes shall be paid in full; and, for the purposes of such subrogation, no such
payments or distributions to the holders of the Senior Debt by or on behalf of
the Issuer or Co-Issuer, or by or on behalf of the Holders by virtue of this
Article Ten, which otherwise would have been made to the Holders shall, as
between the Issuers and the Holders, be deemed to be a payment by the Issuer or
Co-Issuer to or on account of the Senior Debt, it being understood that the
provisions of this Article Ten are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Senior Debt, on the other hand.
SECTION 10.06. Obligations of the Issuers Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as among the Issuers, their
creditors other than the holders of Senior Debt, and the Holders, the obligation
of the Issuers, which is absolute and unconditional, to pay to the Holders the
principal of and any interest on the Notes as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall affect
the relative rights of the Holders and creditors of the Issuers other than the
holders of the Senior Debt, nor shall anything herein or therein prevent the
Holder of any Note or the Trustee on its behalf from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, of the holders of Senior Debt in respect of cash, assets
or securities of the Issuer or Co-Issuer received upon the exercise of any such
remedy.
SECTION 10.07. Notice to Trustee.
The Issuers shall give prompt written notice to the Trustee of any
fact known to the Issuers which would prohibit the making of any payment to or
by the Trustee in respect of the Notes pursuant to the provisions of this
Article Ten, although any delay or failure to give any
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such notice shall have no effect on the subordination provisions contained
herein. Regardless of anything to the contrary contained in this Article Ten or
elsewhere in this Indenture, the Trustee shall not be charged with knowledge of
the existence of any default or event of default with respect to any Senior Debt
or of any other facts which would prohibit the making of any payment to or by
the Trustee unless and until the Trustee shall have received notice in writing
from the Issuers, or from a holder of Senior Debt or a Representative therefor
and, prior to the receipt of any such written notice, the Trustee shall be
entitled to assume (in the absence of actual knowledge to the contrary) that no
such facts exist. The Trustee shall be entitled to rely on the delivery to it of
any notice pursuant to this Section 10.07 to establish that such notice has been
given by a holder of Senior Debt (or a Representative thereof).
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article Ten, the Trustee may request such Person to furnish evidence to the
satisfaction of the Trustee as to the amounts of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Ten, and if such evidence is not furnished the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
SECTION 10.08. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Issuer or Co-Issuer
referred to in this Article Ten, the Trustee, subject to the provisions of
Article Seven hereof, and the Holders of the Notes shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction in which
any insolvency, bankruptcy, receivership, dissolution, winding-up, liquidation,
reorganization or similar case or proceeding is pending, or upon a certificate
of the receiver, trustee in bankruptcy, liquidating trustee, assignee for the
benefit of creditors, agent or other person making such payment or distribution,
delivered to the Trustee or the Holders of the Notes, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other Indebtedness of the
Issuer or Co-Issuer, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Ten.
SECTION 10.09. Trustee's Relation to Senior Debt.
The Trustee and any agent of the Issuers or the Trustee shall be
entitled to all the rights set forth in this Article Ten with respect to any
Senior Debt which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Debt and nothing in
this Indenture shall deprive the Trustee or any such agent of any of its rights
as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Ten, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be
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read into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Debt.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Debt, the distribution may be made and the notice may be given
to their Representative, if any.
SECTION 10.10. Subordination Rights Not Impaired by Acts or Omissions of the
Issuers or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Issuers
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Issuers with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee, without incurring responsibility to the
Trustee or the Holders of the Notes and without impairing or releasing the
subordination provided in this Article Ten or the obligations hereunder of the
Holders of the Notes to the holders of the Senior Debt, do any one or more of
the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt, or otherwise amend or
supplement in any manner Senior Debt, or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (iii) release any Person liable in any manner for the
payment or collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Issuers and any other Person.
SECTION 10.11. Holders Authorize Trustee To Effectuate Subordination of Notes.
Each Holder of Notes by its acceptance of them authorizes and
expressly directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of Senior Debt
and the Holders of Notes, the subordination provided in this Article Ten, and
appoints the Trustee its attorney-in-fact for such purposes, including, in the
event of any dissolution, winding-up, liquidation or reorganization of the
Issuer or Co-Issuer (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
credits or otherwise) tending towards liquidation of the business and assets of
the Issuer or Co-Issuer, the filing of a claim for the unpaid balance of its
Notes and accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
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Holders of said Notes. Nothing herein contained shall be deemed to authorize the
Trustee or the holders of Senior Debt or their Representative to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee or the holders of
Senior Debt or their Representative to vote in respect of the claim of any
Holder in any such proceeding.
SECTION 10.12. This Article Ten Not To Prevent Events of Default.
The failure to make a payment on account of principal of or interest
on the Notes by reason of any provision of this Article Ten will not be
construed as preventing the occurrence of an Event of Default.
SECTION 10.13. Trustee's Compensation Not Prejudiced.
Nothing in this Article Ten will apply to amounts due to the Trustee
(other than payments of Obligations owing to Holders in respect of Notes)
pursuant to other Sections of this Indenture.
ARTICLE ELEVEN
NOTE GUARANTEE
SECTION 11.01. Unconditional Guarantee.
Subject to the provisions of this Article Eleven, each of the
Guarantors hereby, jointly and severally, unconditionally and irrevocably
guarantees to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Notes or the obligations of the
Issuers or any other Guarantors to the Holders or the Trustee hereunder or
thereunder: (a) (x) the due and punctual payment of the principal of, premium,
if any, and interest on the Notes when and as the same shall become due and
payable, whether at maturity, upon redemption or repurchase, by acceleration or
otherwise, (y) the due and punctual payment of interest on the overdue principal
and (to the extent permitted by law) interest, if any, on the Notes and (z) the
due and punctual payment and performance of all other obligations of the Issuers
and all other obligations of the other Guarantors (including under the Note
Guarantees), in each case, to the Holders or the Trustee hereunder or thereunder
(including amounts due the Trustee under Section 7.07 hereof), all in accordance
with the terms hereof and thereof (collectively, the "Guarantee Obligations");
and (b) in case of any extension of time of payment or renewal of any Notes or
any of such other obligations, the due and punctual payment and performance of
Guarantee Obligations in accordance with the terms of the extension or renewal,
whether at maturity, upon redemption or repurchase, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed, or failing
performance of any other obligation of the Issuers to the Holders under this
Indenture or under the Notes, for whatever reason, each Guarantor shall be
obligated to pay, or to perform or cause the performance of, the same
immediately. A Default under this Indenture or the Notes
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shall constitute an event of default under the Note Guarantees, and shall
entitle the Holders of Notes to accelerate the obligations of the Guarantors
thereunder in the same manner and to the same extent as the obligations of the
Issuers.
Each of the Guarantors hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, any release of any other Guarantor, the
recovery of any judgment against the Issuers, any action to enforce the same,
whether or not a Note Guarantee is affixed to any particular Note, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor. Each of the Guarantors hereby waives the benefit of
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Issuers, any right to require a
proceeding first against the Issuers, protest, notice and all demands whatsoever
and covenants that its Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes, this Indenture and this
Note Guarantee. This Note Guarantee is a guarantee of payment and not of
collection. If any Holder or the Trustee is required by any court or otherwise
to return to the Issuers or to any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Issuers or such
Guarantor, any amount paid by the Issuers or such Guarantor to the Trustee or
such Holder, this Note Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between it, on the one hand, and the Holders of Notes and the Trustee, on the
other hand, (a) subject to this Article Eleven, the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article Six for the purposes
of this Note Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (b) in the event of any acceleration of such obligations
as provided in Article Six hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantors for the
purpose of this Note Guarantee.
SECTION 11.02. Subordination of Note Guarantee.
The obligations of each Guarantor under its Note Guarantee pursuant to
this Article Eleven shall be junior and subordinated to the prior payment in
full of the Guarantor Senior Debt of such Guarantor in cash, Cash Equivalents or
other cash equivalents reasonably acceptable to the holders of such Guarantor
Senior Debt of such Guarantor on the same basis as the Notes are junior and
subordinated to Senior Debt of the Issuers. For the purposes of the foregoing
sentence, the Trustee and the Holders shall have the right to receive and/or
retain payments by any of the Guarantors only at such times as they may receive
and/or retain payments in respect of the Notes pursuant to this Indenture,
including Article Ten hereof.
SECTION 11.03. Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee of
such Guarantor not constitute a fraudulent transfer or conveyance for purposes
of Bankruptcy Law, the Uniform Fraudulent
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Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal,
foreign or state law to the extent applicable to any Note Guarantee. To
effectuate the foregoing intention, the Trustee, the Holders and the Guarantors
hereby irrevocably agree that the obligations of such Guarantor under its Note
Guarantee and this Article Eleven shall be limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor (including any guarantee of a Credit Facility under Section
4.10(b)(1)) that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article Eleven, result in the obligations of such Guarantor
under its Note Guarantee not constituting a fraudulent transfer or conveyance.
SECTION 11.04. Execution and Delivery of Note Guarantee.
To further evidence its Note Guarantee set forth in Section 11.01,
each Guarantor hereby agrees that a notation of such Note Guarantee,
substantially in the form of Exhibit F hereto, shall be endorsed on each Note
authenticated and delivered by the Trustee. Such Note Guarantee shall be
executed on behalf of each Guarantor by either manual or facsimile signature of
one Officer or other person duly authorized by all necessary corporate action of
each Guarantor who shall have been duly authorized to so execute by all
requisite corporate action. The validity and enforceability of any Note
Guarantee shall not be affected by the fact that it is not affixed to any
particular Note.
Each of the Guarantors hereby agrees that its Note Guarantee set forth
in Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Note Guarantee no longer holds that office at the time the Trustee authenticates
the Note on which such Note Guarantee is endorsed or at any time thereafter,
such Guarantor's Note Guarantee of such Note shall nevertheless be valid.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Note Guarantee set forth
in this Indenture on behalf of each Guarantor.
SECTION 11.05. Release of a Guarantor.
The Note Guarantee of a Guarantor will be released:
(1) in the event of a sale or other disposition of all or
substantially all of the assets of such Subsidiary Guarantor, by way of
merger, consolidation or otherwise, or a sale or other disposition of all
of the Equity Interests of such Subsidiary Guarantor then held by the
Issuer and the Restricted Subsidiaries;
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(2) if such Subsidiary Guarantor is designated as an Unrestricted
Subsidiary or otherwise ceases to be a Restricted Subsidiary, in each case
in accordance with the provisions of the Indenture, upon effectiveness of
such designation or when it first ceases to be a Restricted Subsidiary,
respectively; or
(3) if such Subsidiary Guarantor shall not guarantee any Indebtedness
under any Credit Facility (other than if such Subsidiary Guarantor no
longer guarantees any Indebtedness under any Credit Facility as a result of
payment under any guarantee of any such Indebtedness by any Subsidiary
Guarantor); provided that a Subsidiary Guarantor shall not be permitted to
be released from its Note Guarantee if it is an obligor with respect to
Indebtedness that would not, under Section 4.10, be permitted to be
incurred by a Restricted Subsidiary that is not a Guarantor.
The Trustee shall execute an appropriate instrument prepared by the
Issuers evidencing the release of a Guarantor from its obligations under its
Note Guarantee upon receipt of a request by the Issuers or such Guarantor
accompanied by an Officers' Certificate and an Opinion of Counsel certifying as
to the compliance with this Section 11.05; provided, however, that the legal
counsel delivering such Opinion of Counsel may rely as to matters of fact on one
or more Officers' Certificates of the Issuers.
Except as set forth in Articles Four and Five and this Section 11.05,
nothing contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of a Guarantor with or into the Issuers or another
Guarantor or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety to the Issuers or another
Guarantor.
SECTION 11.06. Waiver of Subrogation.
Until this Indenture is discharged and all of the Notes are discharged
and paid in full, each Guarantor hereby irrevocably waives and agrees not to
exercise any claim or other rights which it may now or hereafter acquire against
the Issuers that arise from the existence, payment, performance or enforcement
of the Issuers' obligations under the Notes or this Indenture and such
Guarantor's obligations under this Note Guarantee and this Indenture, in any
such instance including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Issuers, whether
or not such claim, remedy or right arises in equity, or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Issuers, directly or indirectly, in cash or other assets or by set-off or in
any other manner, payment or security on account of such claim or other rights.
If any amount shall be paid to any Guarantor in violation of the preceding
sentence and any amounts owing to the Trustee or the Holders of Notes under the
Notes, this Indenture, or any other document or instrument delivered under or in
connection with such agreements or instruments, shall not have been paid in
full, such amount shall have been deemed to have been paid to such Guarantor for
the benefit of, and held in trust for the benefit of, the Trustee or the Holders
and shall forthwith be paid to the Trustee for the benefit of itself or such
Holders to be credited and applied to the obligations in favor of the Trus-
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tee or the Holders, as the case may be, whether matured or unmatured, in
accordance with the terms of this Indenture. Each Guarantor acknowledges that it
will receive direct and indirect benefits from the financing arrangements
contemplated by this Indenture and that the waiver set forth in this Section
11.06 is knowingly made in contemplation of such benefits.
SECTION 11.07. Immediate Payment.
Each Guarantor agrees to make immediate payment to the Trustee on
behalf of the Holders of all Guarantee Obligations owing or payable to the
respective Holders upon receipt of a demand for payment therefor by the Trustee
to such Guarantor in writing.
SECTION 11.08. No Set-Off.
Each payment to be made by a Guarantor hereunder in respect of the
Guarantee Obligations shall be payable in the currency or currencies in which
such Guarantee Obligations are denominated, and shall be made without set-off,
counterclaim, reduction or diminution of any kind or nature.
SECTION 11.09. Guarantee Obligations Absolute.
The obligations of each Guarantor hereunder are and shall be absolute
and unconditional and any monies or amounts expressed to be owing or payable by
each Guarantor hereunder which may not be recoverable from such Guarantor on the
basis of a Guarantee shall be recoverable from such Guarantor as a primary
obligor and principal debtor in respect thereof.
SECTION 11.10. Guarantee Obligations Continuing.
The obligations of each Guarantor hereunder shall be continuing and
shall remain in full force and effect until all such obligations have been paid
and satisfied in full. Each Guarantor agrees with the Trustee that it will from
time to time deliver to the Trustee suitable acknowledgments of this continued
liability hereunder and under any other instrument or instruments in such form
as counsel to the Trustee may advise and as will prevent any action brought
against it in respect of any default hereunder being barred by any statute of
limitations now or hereafter in force and, in the event of the failure of a
Guarantor so to do, it hereby irrevocably appoints the Trustee the attorney and
agent of such Guarantor to make, execute and deliver such written acknowledgment
or acknowledgments or other instruments as may from time to time become
necessary or advisable, in the judgment of the Trustee on the advice of counsel,
to fully maintain and keep in force the liability of such Guarantor hereunder.
SECTION 11.11. Guarantee Obligations Not Reduced.
The obligations of each Guarantor hereunder shall not be satisfied,
reduced or discharged solely by the payment of such principal, premium, if any,
interest, fees and other monies or amounts as may at any time prior to discharge
of this Indenture pursuant to Article
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Eight be or become owing or payable under or by virtue of or otherwise in
connection with the Notes or this Indenture.
SECTION 11.12. Guarantee Obligations Reinstated.
The obligations of each Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Guarantor hereunder
(whether such payment shall have been made by or on behalf of the Issuers or by
or on behalf of a Guarantor) is rescinded or reclaimed from any of the Holders
upon the insolvency, bankruptcy, liquidation or reorganization of the Issuers or
any Guarantor or otherwise, all as though such payment had not been made. If
demand for, or acceleration of the time for, payment by the Issuers or any other
Guarantor is stayed upon the insolvency, bankruptcy, liquidation or
reorganization of the Issuers or such Guarantor, all such Indebtedness otherwise
subject to demand for payment or acceleration shall nonetheless be payable by
each Guarantor as provided herein.
SECTION 11.13. Guarantee Obligations Not Affected.
The obligations of each Guarantor hereunder shall not be affected,
impaired or diminished in any way by any act, omission, matter or thing
whatsoever, occurring before, upon or after any demand for payment hereunder
(and whether or not known or consented to by any Guarantor or any of the
Holders) which, but for this provision, might constitute a whole or partial
defense to a claim against any Guarantor hereunder or might operate to release
or otherwise exonerate any Guarantor from any of its obligations hereunder or
otherwise affect such obligations, whether occasioned by default of any of the
Holders or otherwise, including, without limitation:
(a) any limitation of status or power, disability, incapacity or other
circumstance relating to the Issuers or any other Person, including any
insolvency, bankruptcy, liquidation, reorganization, readjustment,
composition, dissolution, winding-up or other proceeding involving or
affecting the Issuers or any other Person;
(b) any irregularity, defect, unenforceability or invalidity in
respect of any indebtedness or other obligation of the Issuers or any other
Person under this Indenture, the Notes or any other document or instrument;
(c) any failure of the Issuers or any other Guarantor, whether or not
without fault on its part, to perform or comply with any of the provisions
of this Indenture, the Notes or any Note Guarantee, or to give notice
thereof to a Guarantor;
(d) the taking or enforcing or exercising or the refusal or neglect to
take or enforce or exercise any right or remedy from or against the Issuers
or any other Person or their respective assets or the release or discharge
of any such right or remedy;
(e) the granting of time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the
Issuers or any other Person;
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(f) any change in the time, manner or place of payment of, or in any
other term of, any of the Notes, or any other amendment, variation,
supplement, replacement or waiver of, or any consent to departure from, any
of the Notes or this Indenture, including, without limitation, any increase
or decrease in the principal amount of or premium, if any, or interest on
any of the Notes;
(g) any change in the ownership, control, name, objects, businesses,
assets, capital structure or constitution of the Issuer, the Co-Issuer or a
Guarantor;
(h) any merger or amalgamation of the Issuers or a Guarantor with any
Person or Persons;
(i) the occurrence of any change in the laws, rules, regulations or
ordinances of any jurisdiction by any present or future action of any
governmental authority or court amending, varying, reducing or otherwise
affecting, or purporting to amend, vary, reduce or otherwise affect, any of
the Guarantee Obligations or the obligations of a Guarantor under its Note
Guarantee; and
(j) any other circumstance, including release of a Guarantor pursuant
to Section 11.05 (other than by complete, irrevocable payment) that might
otherwise constitute a legal or equitable discharge or defense of the
Issuers under this Indenture or the Notes or of a Guarantor in respect of
its Note Guarantee hereunder.
SECTION 11.14. Waiver.
Without in any way limiting the provisions of Section 11.01, each
Guarantor hereby waives notice of acceptance hereof, notice of any liability of
any Guarantor hereunder, notice or proof of reliance by the Holders upon the
obligations of any Guarantor hereunder, and diligence, presentment, demand for
payment on the Issuers, protest, notice of dishonor or non-payment of any of the
Guarantee Obligations, or other notice or formalities to the Issuers or any
Guarantor of any kind whatsoever.
SECTION 11.15. No Obligation To Take Action Against the Issuers.
Neither the Trustee nor any other Person shall have any obligation to
enforce or exhaust any rights or remedies against the Issuers or any other
Person or any property of the Issuers or any other Person before the Trustee is
entitled to demand payment and performance by any or all Guarantors of their
liabilities and obligations under their Note Guarantees or under this Indenture.
SECTION 11.16. Dealing with the Issuers and Others.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may
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(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Issuers or any
other Person;
(b) take or abstain from taking security or collateral from the
Issuers or from perfecting security or collateral of the Issuers;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect of (with or without consideration)
any and all collateral, mortgages or other security given by the Issuers or
any third party with respect to the obligations or matters contemplated by
this Indenture or the Notes;
(d) accept compromises or arrangements from the Issuers;
(e) apply all monies at any time received from the Issuers or from any
security upon such part of the Guarantee Obligations as the Holders may see
fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal with,
the Issuers and all other Persons and any security as the Holders or the
Trustee may see fit.
SECTION 11.17. Default and Enforcement.
If any Guarantor fails to pay in accordance with Section 11.07 hereof,
the Trustee may proceed in its name as trustee hereunder in the enforcement of
the Note Guarantee of any such Guarantor and such Guarantor's obligations
thereunder and hereunder by any remedy provided by law, whether by legal
proceedings or otherwise, and to recover from such Guarantor the obligations.
SECTION 11.18. Amendment, Etc.
Subject to Section 9.03 hereof, no amendment, modification or waiver
of any provision of this Indenture relating to any Guarantor or consent to any
departure by any Guarantor or any other Person from any such provision will in
any event be effective unless it is signed by such Guarantor and the Trustee.
SECTION 11.19. Acknowledgment.
Each Guarantor hereby acknowledges communication of the terms of this
Indenture and the Notes and consents to and approves of the same.
SECTION 11.20. Costs and Expenses.
Each Guarantor shall pay on demand by the Trustee any and all costs,
fees and expenses (including, without limitation, legal fees on a solicitor and
client basis) incurred by the Trustee, its agents, advisors and counsel or any
of the Holders in enforcing any of their rights under any Note Guarantee.
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SECTION 11.21. No Merger or Waiver; Cumulative Remedies.
No Note Guarantee shall operate by way of merger of any of the
obligations of a Guarantor under any other agreement, including, without
limitation, this Indenture. No failure to exercise and no delay in exercising,
on the part of the Trustee or the Holders, any right, remedy, power or privilege
hereunder or under this Indenture or the Notes, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder or under this Indenture or the Notes preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges in the Note Guarantee and
under this Indenture, the Notes and any other document or instrument between a
Guarantor and/or the Issuers and the Trustee are cumulative and not exclusive of
any rights, remedies, powers and privilege provided by law.
SECTION 11.22. Survival of Guarantee Obligations.
Without prejudice to the survival of any of the other obligations of
each Guarantor hereunder, the obligations of each Guarantor under Section 11.01
shall survive the payment in full of the Guarantee Obligations and shall be
enforceable against such Guarantor without regard to and without giving effect
to any defense, right of offset or counterclaim available to or which may be
asserted by the Issuers or any Guarantor.
SECTION 11.23. Guarantee in Addition to Other Guarantee Obligations.
The obligations of each Guarantor under its Note Guarantee and this
Indenture are in addition to and not in substitution for any other obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Notes and any guarantees or security at any time held by or for the benefit of
any of them.
SECTION 11.24. Severability.
Any provision of this Article Eleven which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction
unless its removal would substantially defeat the basic intent, spirit and
purpose of this Indenture and this Article Eleven.
SECTION 11.25. Successors and Assigns.
Each Note Guarantee shall be binding upon and inure to the benefit of
each Guarantor and the Trustee and the other Holders and their respective
successors and permitted assigns, except that no Guarantor may assign any of its
obligations hereunder or thereunder.
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ARTICLE TWELVE
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required or deemed to be included in this
Indenture by the Trust Indenture Act, such required or deemed provision shall
control.
SECTION 12.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by nationally recognized overnight courier service, by telecopier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Issuers or a Guarantor:
c/o Norcraft Companies, L.P.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Ropes & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇, Esq.
if to the Trustee:
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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Each of the Issuers and the Trustee by written notice to each other
such Person may designate additional or different addresses for notices to such
Person. Any notice or communication to the Issuers and the Trustee, shall be
deemed to have been given or made as of the date so delivered if personally
delivered; when answered back; when receipt is acknowledged, if telecopied; five
(5) calendar days after mailing if sent by registered or certified mail, postage
prepaid (except that a notice of change of address shall not be deemed to have
been given until actually received by the addressee); and next Business Day if
by nationally recognized overnight courier service.
Any notice or communication mailed to a Holder shall be mailed to him
by first class mail or other equivalent means at his address as it appears on
the registration books of the Registrar and shall be sufficiently given to him
if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
SECTION 12.03. Communications by Holders with Other Holders.
Holders may communicate pursuant to Trust Indenture Act (S) 312(b)
with other Holders with respect to their rights under this Indenture, the Notes
or the Note Guarantees. The Issuers, the Trustee, the Registrar and any other
Person shall have the protection of Trust Indenture Act (S) 312(c).
SECTION 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuers to the Trustee to take
any action under this Indenture, the Issuers shall furnish to the Trustee at the
request of the Trustee:
(1) an Officers' Certificate, in form and substance satisfactory to
the Trustee, stating that, in the opinion of the signers, all conditions
precedent to be performed or effected by the Issuers, if any, provided for
in this Indenture relating to the proposed action have been complied with;
and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, any and all such conditions precedent have been complied with.
SECTION 12.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.06, shall include:
(1) a statement that the Person making such certificate or opinion has
read such covenant or condition;
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(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, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with or satisfied; and
(4) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 12.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee, Paying Agent or Registrar may make reasonable rules for
its functions.
SECTION 12.07. Legal Holidays.
If a payment date is not a Business Day, payment may be made on the
next succeeding day that is a Business Day.
SECTION 12.08. Governing Law.
This Indenture, the Notes and the Note Guarantees will be governed by
and construed in accordance with the laws of the State of New York, as applied
to contracts made and performed within the State of New York, without regard to
principles of conflicts of law.
SECTION 12.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Issuers or any of its Subsidiaries. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 12.10. No Recourse Against Others.
No director, officer, employee, incorporator, stockholder, member or
manager of the Issuer, the Co-Issuer or any Guarantor or the General Partner
shall have any liability for any obligations of the Issuers under the Notes or
this Indenture or of any Guarantor under its Note Guarantee or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder of Notes by accepting a Note waives and releases all such liability.
Such waiver and release are part of the consideration for issuance of the Notes.
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SECTION 12.11. Successors.
All agreements of the Issuers and the Guarantors in this Indenture,
the Notes and the Note Guarantees shall bind their respective successors. All
agreements of the Trustee in this Indenture shall bind its successor.
SECTION 12.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy or counterpart shall be an original, but all of them together shall
represent the same agreement.
SECTION 12.13. Severability.
In case any one or more of the provisions in this Indenture, in the
Notes or in the Note Guarantees shall be held invalid, illegal or unenforceable,
in any respect for any reason, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions shall not
in any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the date first written above.
NORCRAFT COMPANIES, L.P.,
as Issuer
By: Norcraft GP, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Person
NORCRAFT FINANCE CORP.,
as Co-Issuer
By /x/ ▇▇▇▇▇ ▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Vice President
S-1
NORCRAFT CANADA CORPORATION,
as Guarantor
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
S-2
U.S. BANK NATIONAL ASSOCIATION
as Trustee
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
S-3
EXHIBIT A
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
NORCRAFT COMPANIES, L.P.
NORCRAFT FINANCE CORP.
9% Senior Subordinated Notes 2011
CUSIP No.
No. $
NORCRAFT COMPANIES, L.P., a Delaware limited partnership (the
"Issuer"), and NORCRAFT FINANCE CORP., a Delaware corporation (the "Co-Issuer"
and, together with the Issuer, the "Issuers"), for value received promise to pay
to CEDE & CO. or its registered assigns, the principal sum of on November 1,
2011.
Interest Payment Dates: May 1 and November 1, commencing May 1, 2004.
Record Dates: April 15 and October 15.
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
A-1
IN WITNESS WHEREOF, the Issuers have caused this Note to be signed
manually or by facsimile by its duly authorized officer.
Dated:
NORCRAFT COMPANIES, L.P.,
as Issuer
By: Norcraft GP, L.L.C.,
its General Partner
By:
-------------------------------------
Name:
Title:
NORCRAFT FINANCE CORP.,
as Co-Issuer
By
-------------------------------------
Name:
Title:
A-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9% Senior Subordinated Notes due 2011 described in
the within-mentioned Indenture.
Dated: U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
------------------------------------
Authorized Signatory
A-3
(Reverse of Note)
9% Senior Subordinated Notes due 2011
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
SECTION 1. Interest. Norcraft Companies, L.P., a Delaware limited
partnership (the "Issuer") and Norcraft Finance Corp., a Delaware corporation
(the "Co-Issuer" and, together with the Issuer, the "Issuers"), promise to pay
interest on the principal amount of this Note at 9% per annum from October 21,
2003 until maturity. The Issuers will pay interest semi-annually on May 1 and
November 1 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an "Interest Payment Date"), commencing May 1,
2004. Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
original issuance. The Issuers shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand to the extent lawful at the
interest rate applicable to the Notes; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
SECTION 2. Method of Payment. The Issuers will pay interest on the
Notes (except defaulted interest) to the Persons who are registered Holders of
Notes at the close of business on the April 15 or October 15 next preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest. The Notes will be issued in
denominations of $1,000 and integral multiples thereof. The Issuers shall pay
principal, premium, if any, and interest on the Notes in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). Principal, premium,
if any, and interest on the Notes will be payable at the office or agency of the
Issuers maintained for such purpose except that, at the option of the Issuers,
the payment of interest may be made by check mailed to the Holders of the Notes
at their respective addresses set forth in the register of Holders of Notes;
provided that all payments of principal, premium and interest with respect to
Notes the Holders of which have given wire transfer instructions to the Issuers
at least ten Business Days prior to the relevant Interest Payment Date will be
required to be made by wire transfer of immediately available funds to the
accounts specified by the Holders thereof. Until otherwise designated by the
Issuers, the Issuers' office or agency in New York will be the office of the
Trustee maintained for such purpose.
SECTION 3. Paying Agent and Registrar. Initially, U.S. Bank National
Association, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Issuers
A-4
may change any Paying Agent or Registrar without notice to any Holder. The
Issuers or any of their Subsidiaries may act in any such capacity.
SECTION 4. Indenture and Subordination. The Issuers issued the Notes
under an Indenture dated as of October 21, 2003 ("Indenture") by and among the
Issuer, the Co-Issuer, the Guarantors and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code (S)(S)
77aaa-77bbbb) (the "Trust Indenture Act"). The Notes are subject to all such
terms, and Holders are referred to the Indenture and the Trust Indenture Act for
a statement of such terms. The payment of the Notes will, to the extent set
forth in the Indenture, be subordinated in right of payment to the prior payment
in full in cash or cash equivalents of all Senior Debt.
SECTION 5. Optional Redemption. Except as set forth in Section 6
hereof, the Notes will not be redeemable at the Issuer's option prior to
November 1, 2007. On or after November 1, 2007, the Notes will be subject to
redemption at any time at the option of the Issuer, in whole or in part, upon
not less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest thereon, if any, to the applicable Redemption Date, if redeemed
during the twelve-month period beginning on November 1 of the years indicated
below:
Year Percentage
---- ----------
2007........................................... 104.500%
2008........................................... 102.250%
2009 and thereafter............................ 100.000%
SECTION 6. Optional Redemption upon Public Equity Offering or Upon a
Change of Control. (a) At any time prior to November 1, 2006, the Issuer may
redeem up to 35% of the aggregate principal amount of Notes with the net cash
proceeds of one or more Qualified Equity Offerings at a redemption price equal
to 109.000% of the principal amount of the Notes to be redeemed, plus accrued
and unpaid interest thereon, if any, to the Redemption Date; provided that (i)
at least 65% of the aggregate principal amount of Notes issued under the
Indenture remains outstanding immediately after the occurrence of such
redemption and (ii) such redemption shall occur within 90 days of the date of
the closing of any such Qualified Equity Offering.
(b) Before November 1, 2007, the Issuer may also redeem the Notes, as
a whole but not in part, upon the occurrence of a Change of Control, upon not
less than 30 nor more than 60 days' prior notice (but in no event more than 90
days after the occurrence of such Change of Control), at a redemption price
equal to 100% of the principal amount thereof plus the Applicable Premium as of,
and accrued and unpaid interest thereon, if any, to, the date of redemption (a
"Change of Control Redemption Date").
A-5
SECTION 7. Mandatory Redemption. For the avoidance of doubt, an offer
to purchase pursuant to Section 8 hereof shall not be deemed a redemption. The
Issuers shall not be required to make mandatory redemption payments with respect
to the Notes.
SECTION 8. Repurchase at Option of Holder. Upon the occurrence of a
Change of Control, and subject to certain conditions set forth in the Indenture,
the Issuers will be required to offer to purchase all of the outstanding Notes
at a purchase price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest, if any, thereon to the date of repurchase.
The Issuers are, subject to certain conditions and exceptions,
obligated to make an offer to purchase Notes at 100% of their principal amount,
plus accrued and unpaid interest, if any, thereon to the date of repurchase,
with certain net cash proceeds of certain sales or other dispositions of assets
in accordance with the Indenture.
SECTION 9. Notice of Redemption. Notice of redemption will be mailed
by first class mail at least 30 days but not more than 60 days before the
redemption date to each Holder of Notes to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in part. If
any Note is to be redeemed in part only, the notice of redemption that relates
to such Note shall state the portion of the principal amount thereof to be
redeemed. A new Note in principal amount equal to the unredeemed portion thereof
will be issued in the name of the Holder thereof upon cancellation of the
original Note. On and after the redemption date interest ceases to accrue on
Notes or portions thereof called for redemption.
SECTION 10. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Issuers may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture. The Issuers and the
Registrar are not required to transfer or exchange any Note selected for
redemption. Also, the Issuers and the Registrar are not required to transfer or
exchange any Notes for a period of 15 days before a selection of Notes to be
redeemed.
SECTION 11. Persons Deemed Owners. The registered Holder of a Note may
be treated as its owner for all purposes.
SECTION 12. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture and the Notes may be amended or supplemented with the
written consent of the Holders of at least a majority in aggregate principal
amount of the Notes then outstanding, and any existing Default or compliance
with any provision may be waived with the consent of the Holders of a majority
in aggregate principal amount of the Notes then outstanding. Without notice to
or consent of any Holder, the parties thereto may amend or sup
A-6
plement the Indenture and the Notes to, among other things, cure any ambiguity,
defect or inconsistency in the Indenture, provide for uncertificated Notes in
addition to certificated Notes, comply with any requirements of the SEC in
connection with the qualification of the Indenture under the Trust Indenture
Act, or make any change that does not materially adversely affect the rights of
any Holder of a Note.
SECTION 13. Defaults and Remedies. If a Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes generally may declare all the Notes to be due and
payable immediately. Notwithstanding the foregoing, in the case of a Default
arising from certain events of bankruptcy or insolvency as set forth in the
Indenture, with respect to the Issuer, the Co-Issuer or the General Partner, all
outstanding Notes will become due and payable without further action or notice.
Holders of the Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default (except a Default relating to the payment
of principal or interest including an accelerated payment or the failure to make
a payment on the Change of Control Payment Date or the Net Proceeds Payment Date
pursuant to a Net Proceeds Offer) or a Default in complying with the provisions
of Article Five of the Indenture if it determines that withholding notice is in
their interest. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default and its consequences under the
Indenture except a continuing Default in the payment of interest on, or the
principal of, or the premium on, the Notes.
SECTION 14. Restrictive Covenants. The Indenture contains certain
covenants that, among other things, limit the ability of the Issuer and its
Restricted Subsidiaries to make restricted payments, to incur indebtedness, to
create liens, to sell assets, to permit restrictions on dividends and other
payments by Restricted Subsidiaries of Issuer, to consolidate, merge or sell all
or substantially all of its assets or to engage in transactions with affiliates.
The limitations are subject to a number of important qualifications and
exceptions. The Issuers must annually report to the Trustee on compliance with
such limitations.
SECTION 15. No Recourse Against Others. No director, officer,
employee, incorporator, stockholder, member or manager of the Issuer, the
Co-Issuer or any Guarantor or the General Partner shall have any liability for
any obligations of the Issuers under the Notes or the Indenture, or of any
Guarantor under its Note Guarantee or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
SECTION 16. Note Guarantees. This Note will be entitled to the
benefits of certain Note Guarantees made for the benefit of the Holders.
Reference is hereby made to the
A-7
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Guarantors, the Trustee and the
Holders.
SECTION 17. Trustee Dealings with the Issuers. The Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with the Issuers, their Subsidiaries or
their respective Affiliates as if it were not the Trustee.
SECTION 18. Authentication. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
SECTION 19. Abbreviations. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entirety), 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).
SECTION 20. Additional Rights of Holders of Restricted Global Notes
and Restricted Definitive Notes. Pursuant to, but subject to the exceptions in,
the Registration Rights Agreement, the Issuers and the Guarantors will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Note for a 9% Senior Subordinated
Note due 2011 of the Issuers which shall have been registered under the
Securities Act, in like principal amount and having terms identical in all
material respects to this Note (except that such note shall not be entitled to
Additional Interest). The Holders shall be entitled to receive certain
Additional Interest in the event such exchange offer is not consummated or the
Notes are not offered for resale and upon certain other conditions, all pursuant
to and in accordance with the terms of the Registration Rights Agreement.1
SECTION 21. CUSIP Numbers. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Issuer has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
SECTION 22. Governing Law. This Note shall be governed by, and
construed in accordance with, the laws of the State of New York without giving
effect to applicable principles of conflicts of laws to the extent that the
application of the laws of another jurisdiction would be required thereby.
----------
(a) This Section not to appear on Exchange Notes.
A-8
The Issuers will furnish to any Holder upon written request and
without charge a copy of the Indenture.
A-9
ASSIGNMENT FORM
I or we assign and transfer this Note to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
--------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint agent to transfer this Note on the books
----------------
of the Issuers. The agent may substitute another to act for him.
Dated: Signed:
------------------- --------------------------------
(Sign exactly as name appears on
the other side of this Note)
Signature Guarantee:
---------------------------------------------
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
In connection with any transfer of this Note occurring prior to the date
which is the earlier of (i) the date of the declaration by the SEC of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the "Securities Act"), covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) the date following the second anniversary of the original
issuance of this Note, the undersigned confirms that it has not utilized any
general solicitation or general advertising in connection with the transfer:
[Check One]
(1) to the Issuer, the Co-Issuer or a subsidiary thereof; or
-----
(2) pursuant to and in compliance with Rule 144A under the Securities
----- Act;
or
(3) to an institutional "accredited investor" (as defined in Rule
-----
501(a)(1), (2), (3) or (7) under the Securities Act) that has
furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter can be
obtained from the Trustee); or
(4) outside the United States to a "foreign purchaser" in compliance with
-----
Rule 904 of Regulation S under the Securities Act; or
(5) pursuant to the exemption from registration provided by Rule 144 under
-----
the Securities Act; or
(6) pursuant to an effective registration statement under the Securities
-----
Act; or
(7) pursuant to another available exemption from the registration
-----
statement requirements of the Securities Act of 1933;
and unless the box below is checked, the undersigned confirms that such Note is
not being transferred to an "affiliate" of the Issuers as defined in Rule 144
under the Securities Act (an "Affiliate"):
[ ] The transferee is an Affiliate of the Issuer or the Co-Issuer.
Unless one of the items is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if item
(3), (4), (5) or (7) is checked, the Issuer, the Co-Issuer or the Trustee may
require, prior to registering any such transfer of the Notes, in their sole
discretion, such written legal opinions, certifications (including an investment
letter in the case of box (3) or (4)) and other information as the Trustee, the
Issuer or the Co-Issuer has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act.
If none of the foregoing items are checked, the Trustee or Registrar
shall not be obligated to register this Note in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the Indenture shall have
been satisfied.
Dated: Signed:
------------------- --------------------------------
(Sign exactly as name appears on
the other side of this Note)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
-2-
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Issuers as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
------------------- ---------------------------------------
NOTICE: To be executed by an executive
officer
-3-
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuers
pursuant to Section 4.09 or Section 4.13 of the Indenture, check the appropriate
box:
Section 4.09 [ ] Section 4.13 [ ]
If you want to elect to have only part of this Note purchased by the
Issuers pursuant to Section 4.09 or Section 4.13 of the Indenture, state the
amount (in denominations of $1,000 and integral multiples thereof): $
-----------
Dated: Signed:
------------------- --------------------------------
(Sign exactly as name appears on
the other side of this Note)
Signature Guarantee:
---------------------------------------------
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
-4-
EXHIBIT B
FORM OF LEGENDS
Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the following legend (the "Private Placement Legend") on the
face thereof until after the second anniversary of the Issue Date, unless
otherwise agreed by the Issuers and the Holder thereof or if such legend is no
longer required by Section 2.16(f) of the Indenture:
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED BY THIS CERTIFICATE WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF
THE U.S. SECURITIES ACT OF 1933, AND THE SECURITY EVIDENCED BY THIS CERTIFICATE
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
REGISTRATION OR AN APPLICABLE EXEMPTION FROM THE SECURITIES ACT. EACH PURCHASER
OF THE SECURITY EVIDENCED BY THIS CERTIFICATE (1) BY ITS ACQUISITION OF THE
SECURITY REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT), (B) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THE SECURITY EVIDENCED BY THIS CERTIFICATE IN AN OFFSHORE TRANSACTION
IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, OR (C) IT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR") THAT IS
ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF AN
INSTITUTIONAL ACCREDITED INVESTOR AND (2) IS HEREBY NOTIFIED THAT THE SELLER MAY
BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A OR ANOTHER EXEMPTION UNDER THE SECURITIES ACT. THE
HOLDER OF THE SECURITY EVIDENCED BY THIS CERTIFICATE AGREES FOR THE BENEFIT OF
THE ISSUERS THAT (X) THIS SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (1)(A) TO A PERSON WHO THE SELLER REAONSABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (B) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, IF AVAILABLE,
(C) OUTSIDE THE UNITED STATES TO A PERSON THAT IS NOT A U.S. PERSON (AS DEFINED
IN RULE 902 UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS
OF REGULATION S UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT IS PURCHASING AT LEAST $100,000 OF NOTES FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF AN INSTITUTIONAL ACCREDITED INVESTOR (AND BASED UPON AN
OPINION OF COUNSEL IF THE ISSUER SO REQUESTS), (2) TO THE ISSUER OR ANY OF ITS
SUBSIDIARIES OR (3)
B-1
UNDER AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN COMPLIANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (Y) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASHER FROM IT OF THE SECURITY EVIDENCED BY THIS
CERTIFICATE OF THE RESALE RESTRICTIONS DESCRIBED IN (X) ABOVE. IN CONNECTION
WITH ANY TRANSFER OF THIS SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE
OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH
CERTIFICATIONS, LEGAL OPINONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.
Each Global Note authenticated and delivered hereunder shall also bear
the following legend:
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 OR A SUCCESSOR DEPOSITORY. 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 TO 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.
B-2
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.16 OF THE INDENTURE.
B-3
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
[ ], [ ]
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Ladies and Gentlemen:
In connection with our proposed purchase of 9% Senior Subordinated
Notes due 2011 (the "Notes") of NORCRAFT COMPANIES, L.P., a Delaware limited
partnership (the "Issuer") and NORCRAFT FINANCE CORP., a Delaware corporation
(the "Co-Issuer" and, together with the Issuer, the "Issuers"), we confirm that:
1. We understand that any subsequent transfer of the Notes is subject
to certain restrictions and conditions set forth in the Indenture relating to
the Notes (the "Indenture") and the undersigned agrees to be bound by, and not
to resell, pledge or otherwise transfer the Notes except in compliance with,
such restrictions and conditions and the Securities Act of 1933, as amended (the
"Securities Act"), and all applicable State securities laws.
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be offered or
sold except as permitted in the following sentence. We agree, on our own behalf
and on behalf of any accounts for which we are acting as hereinafter stated,
that if we should sell any Notes, we will do so only (i) to the Issuer or any of
its subsidiaries, (ii) inside the United States in a transaction meeting the
requirements of Rule 144A under the Securities Act to a person who we reasonably
believe to be a "qualified institutional buyer" (as defined in Rule 144A under
the Securities Act), (iii) inside the United States to an institutional
"accredited investor" (as defined below) that is purchasing at least $100,000 of
Notes for its own account or for the account of an institutional accredited
investor and who, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to the Trustee (as defined in the Indenture) a
signed letter containing certain representations and agreements relating to the
restrictions on transfer of the Notes (the form of which letter can be obtained
from the Trustee), (iv) outside the United States to a person that is not a U.S.
person (as defined in Rule 902 under the Securities Act) in accordance with
Regulation S promulgated under the Securities Act, (v) pursuant to the exemption
from registration provided by Rule 144 under the Securities Act (if available),
(vi) in accordance with another ex-
C-1
emption from the registration requirements of the Securities Act (and based upon
an opinion of counsel if the Issuer so requests) or (vii) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any person purchasing any of the Notes from us a notice advising
such purchaser that resales of the Notes are restricted as stated herein.
3. We are not acquiring the Notes for or on behalf of, and will not
transfer the Notes to, any pension or welfare plan (as defined in Section 3 of
the Employee Retirement Income Security Act of 1974, as amended) or plan (as
defined in Section 4975 of the Internal Revenue Code of 1986, as amended),
except as permitted in the section entitled "Notice to Investors" of the
Offering Memorandum.
4. We understand that, on any proposed resale of any Notes, we will be
required to furnish to the Trustee and the Issuer such certification, legal
opinions and other information as the Trustee and the Issuer may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or their investment, as the case may be.
6. We are acquiring the Notes purchased by us for our account or for
one or more accounts (each of which is an institutional "accredited investor")
as to each of which we exercise sole investment discretion.
C-2
You, the Issuers, the Trustee and others are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
------------------------------------
Name:
Title:
C-3
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[ ], [ ]
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Norcraft Companies, L.P. (the "Issuer") and Norcraft Finance
Corp. (the "Co-Issuer" and, together with the Issuer, the
"Issuers") 9% Senior Subordinated Notes due 2011 (the "Notes")
Ladies and Gentlemen:
In connection with our proposed sale of $[ ] aggregate principal
amount of the Notes, we confirm that such sale has been effected pursuant to and
in accordance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
D-1
You, the Issuers and counsel for the Issuers are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
-------------------------------------
Authorized Signature
D-2
EXHIBIT E
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH TRANSFERS OF TEMPORARY
REGULATION S GLOBAL NOTE
-------------------,------------
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Norcraft Companies, L.P. (the "Issuer") and Norcraft Canada
Corporation (the "Co-Issuer" and together with the Issuer, the
"Issuers") 9% Senior Subordinated Notes due 2011 (the "Notes")
Dear Sirs:
This letter relates to U.S. $ principal amount of Notes
--------------
represented by a certificate (the "Legended Certificate") which bears a legend
outlining restrictions upon transfer of such Legended Certificate. Pursuant to
Section 2.16(d) of the Indenture (the "Indenture") dated as of October 21, 2003
relating to the Notes, we hereby certify that we are (or we will hold such
securities on behalf of) a person outside the United States (or to an Initial
Purchaser (as defined in the Indenture)) to whom the Notes could be transferred
in accordance with Rule 904 of Regulation S promulgated under the U.S.
Securities Act of 1933, as amended.
You and the Issuers are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this letter have the
meanings set forth in Regulation S).
Very truly yours,
[Name of Holder]
By:
------------------------------------
Authorized Signature
E-1
EXHIBIT F
NOTE GUARANTEE
For value received, each of the undersigned hereby unconditionally
guarantees, as principal obligor and not only as a surety, to the Holder of this
Note the cash payment in United States dollars of principal of, premium, if any,
and interest on this Note in the amounts and at the times when due and interest
on the overdue principal, premium, if any, and interest, if any, of this Note,
if lawful, and the payment or performance of all other obligations of the
Issuers under the Indenture (as defined below) or the Notes, to the Holder of
this Note and the Trustee, all in accordance with and subject to the terms and
limitations of this Note, Article Eleven of the Indenture and this Note
Guarantee. This Note Guarantee will become effective in accordance with Article
Eleven of the Indenture and its terms shall be evidenced therein. The validity
and enforceability of any Note Guarantee shall not be affected by the fact that
it is not affixed to any particular Note.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Indenture dated as of October 21, 2003, among Norcraft
Companies, L.P., a Delaware limited partnership (the "Issuer") and Norcraft
Finance Corp., a Delaware corporation (the "Co-Issuer" and, together with the
Issuer, the "Issuers"), the Guarantors named therein and U.S. Bank National
Association, as trustee (the "Trustee"), as amended or supplemented (the
"Indenture").
The obligations of the undersigned to the Holders of Notes and to the
Trustee pursuant to this Note Guarantee and the Indenture are expressly set
forth in Article Eleven of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Note Guarantee and all of the other
provisions of the Indenture to which this Note Guarantee relates.
No director, officer, employee, incorporator, stockholder, member or
manager of any Guarantor, as such, shall have any liability for any obligations
of such Guarantors under such Guarantors' Note Guarantee or for any claim based
on, in respect of, or by reason of, such obligation or its creation.
This Note Guarantee is subordinated in right of payment, in the manner
and to the extent set forth in Article Eleven of the Indenture, to the prior
payment in full in cash or cash equivalents of all Guarantor Senior Debt of the
Guarantors, whether outstanding on the date of the Indenture or thereafter
created, incurred, assumed or guaranteed.
This Note Guarantee shall be governed by, and construed in accordance
with, the laws of the State of New York without giving effect to principles of
conflicts of law. The undersigned Guarantor hereby agrees to submit to the
jurisdiction of the courts of
F-1
the State of New York in any action or proceeding arising out of or relating to
this Note Guarantee.
This Note Guarantee is subject to release upon the terms set forth in
the Indenture.
F-2
IN WITNESS WHEREOF, each Guarantor has caused its Note Guarantee to be
duly executed.
Date:
[ ]
By:
------------------------------------
Name:
Title:
F-3