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AMERCO
AND THE GUARANTORS LISTED ON THE SIGNATURE PAGES HERETO
12% SENIOR SUBORDINATED SECURED NOTES DUE 2011
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INDENTURE
Dated as of March __, 2004
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THE BANK OF NEW YORK,
as Trustee
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- -------
310(a)(1)........................................................................................ 7.10
(a)(2)...................................................................................... 7.10
(a)(3)...................................................................................... N.A.
(a)(4)...................................................................................... N.A.
(a)(5)...................................................................................... 7.10
(b)......................................................................................... 7.10
(c)......................................................................................... N.A.
311(a)........................................................................................... 7.11
(b)......................................................................................... 7.11
(c)......................................................................................... N.A.
312(a)........................................................................................... 2.05
(b)......................................................................................... 14.03
(c)......................................................................................... 14.03
313(a)........................................................................................... 7.06
(b)......................................................................................... 7.06; 7.07
(c)......................................................................................... 7.06; 14.02
(d)......................................................................................... 7.06
314(a)........................................................................................... 4.03
314(a)(4)........................................................................................ 14.05
(c)(1)...................................................................................... 14.04
(c)(2)...................................................................................... 14.04
(c)(3)...................................................................................... N.A.
(e)......................................................................................... 14.05
(f)......................................................................................... N.A.
315(a)........................................................................................... 7.01
(b)......................................................................................... 7.05;14.02
(c)......................................................................................... 7.01
(d)......................................................................................... 7.01
(e)......................................................................................... 6.11
316(a) (last sentence)........................................................................... 2.09
(a)(1)(A)................................................................................... 6.05
(a)(1)(B)................................................................................... 6.04
(a)(2)...................................................................................... N.A.
(b)......................................................................................... 6.06; 6.07
(c)......................................................................................... 2.12
317(a)(1)........................................................................................ 6.08
(a)(2)...................................................................................... 6.09
(b)......................................................................................... 2.04
318(a)........................................................................................... 14.01
(b)......................................................................................... N.A.
(c)......................................................................................... 14.01
N.A. means Not Applicable
Note: This Cross-Reference Table is not part of this Agreement.
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 Definitions.......................................................................... 1
1.02 Other Definitions.................................................................... 27
1.03 Incorporation by Reference of Trust Indenture Act.................................... 28
1.04 Rules of Construction................................................................ 28
ARTICLE II
THE NOTES
2.01 Form and Dating...................................................................... 29
2.02 Execution and Authentication......................................................... 29
2.03 Registrar and Paying Agent........................................................... 30
2.04 Paying Agent to Hold Money in Trust.................................................. 30
2.05 Holder Lists......................................................................... 31
2.06 Transfer and Exchange................................................................ 31
2.07 Replacement Notes.................................................................... 35
2.08 Outstanding Notes.................................................................... 35
2.09 Treasury Notes....................................................................... 35
2.10 Temporary Notes...................................................................... 36
2.11 Cancellation......................................................................... 36
2.12 Defaulted Interest................................................................... 36
2.13 CUSIP Numbers........................................................................ 36
ARTICLE III
REDEMPTION AND PREPAYMENT
3.01 Notices to Trustee................................................................... 37
3.02 Selection of Notes to Be Redeemed.................................................... 37
3.03 Notice of Redemption................................................................. 37
3.04 Effect of Notice of Redemption....................................................... 38
3.05 Deposit of Redemption Price.......................................................... 38
3.06 Notes Redeemed in Part............................................................... 39
3.07 Optional Redemption.................................................................. 39
3.08 Mandatory Redemption................................................................. 39
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE IV
COVENANTS
4.01 Payment of Notes..................................................................... 40
4.02 Maintenance of Office or Agency...................................................... 40
4.03 Reports.............................................................................. 40
4.04 Compliance Certificate............................................................... 41
4.05 Taxes................................................................................ 42
4.06 Stay, Extension and Usury Laws....................................................... 42
4.07 Restricted Payments.................................................................. 43
4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries....................... 45
4.09 Limitation on Additional Indebtedness................................................ 46
4.10 Asset Sales.......................................................................... 48
4.11 Transactions with Affiliates and Designated Persons.................................. 50
4.12 Liens................................................................................ 51
4.13 Business Activities.................................................................. 51
4.14 Corporate Existence.................................................................. 51
4.15 Offer to Repurchase Upon Change of Control........................................... 51
4.16 Designation of Unrestricted Subsidiaries............................................. 53
4.17 Limitation on Issuance or Sale of Equity Interests of Restricted Subsidiaries........ 54
4.18 Additional Note Guarantees........................................................... 54
4.19 Limitations on Sale and Leaseback Transactions....................................... 54
4.20 Payments for Consent................................................................. 55
ARTICLE V
SUCCESSORS
5.01 Merger, Consolidation, or Sale of Assets............................................. 55
5.02 Successor Corporation Substituted.................................................... 56
ARTICLE VI
DEFAULTS AND REMEDIES
6.01 Events of Default.................................................................... 57
6.02 Acceleration......................................................................... 58
6.03 Other Remedies....................................................................... 59
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TABLE OF CONTENTS
(continued)
PAGE
6.04 Waiver of Past Defaults.............................................................. 59
6.05 Control by Majority.................................................................. 60
6.06 Limitation on Suits.................................................................. 60
6.07 Rights of Holders of Notes to Receive Payment........................................ 60
6.08 Collection Suit by Trustee........................................................... 61
6.09 Trustee May File Proofs of Claim..................................................... 61
6.10 Priorities........................................................................... 61
6.11 Undertaking for Costs................................................................ 62
6.12 Actions of a Holder.................................................................. 62
ARTICLE VII
TRUSTEE
7.01 Duties of Trustee.................................................................... 62
7.02 Rights of Trustee.................................................................... 63
7.03 Individual Rights of Trustee......................................................... 64
7.04 Trustee's Disclaimer................................................................. 64
7.05 Notice of Defaults................................................................... 65
7.06 Reports by Trustee to Holders of the Notes........................................... 65
7.07 Compensation and Indemnity........................................................... 65
7.08 Replacement of Trustee............................................................... 66
7.09 Successor Trustee by Merger, etc..................................................... 67
7.10 Eligibility; Disqualification........................................................ 67
7.11 Preferential Collection of Claims Against Company.................................... 67
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
8.01 Option to Effect Legal Defeasance or Covenant Defeasance............................. 67
8.02 Legal Defeasance and Discharge....................................................... 67
8.03 Covenant Defeasance.................................................................. 68
8.04 Conditions to Legal or Covenant Defeasance........................................... 68
8.05 Deposited Money and U.S. Government Obligations to Be Held in Trust; Other
Miscellaneous Provisions............................................................. 70
8.06 Repayment to Company................................................................. 70
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TABLE OF CONTENTS
(continued)
PAGE
8.07 Reinstatement........................................................................ 71
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
9.01 Without Consent of Holders of Notes.................................................. 71
9.02 With Consent of Holders of Notes..................................................... 72
9.03 Compliance with Trust Indenture Act.................................................. 73
9.04 Revocation and Effect of Consents.................................................... 73
9.05 Notation on or Exchange of Notes..................................................... 74
9.06 Trustee to Sign Amendments, etc...................................................... 74
ARTICLE X
NOTE GUARANTEES
10.01 Guarantee............................................................................ 75
10.02 Limitation on Guarantor Liability.................................................... 76
10.03 Execution and Delivery of Note Guarantee............................................. 76
10.04 Guarantors May Consolidate, etc., on Certain Terms................................... 76
10.05 Releases Following Sale of Assets.................................................... 77
ARTICLE XI
COLLATERAL; ESCROW
11.01 Delivery of Security Documents....................................................... 78
11.02 Recording and Opinions............................................................... 78
11.03 Possession and Use of Collateral..................................................... 79
11.04 Release and Disposition of Collateral................................................ 79
11.05 Escrowed Restated SAC Notes.......................................................... 80
ARTICLE XII
SUBORDINATION
12.01 Agreement to Subordinate............................................................. 80
12.02 Liquidation, Dissolution or Bankruptcy............................................... 80
12.03 Default on Senior Indebtedness....................................................... 81
12.04 Obligations of the Trustee and the Holders........................................... 81
12.05 Subrogation.......................................................................... 82
12.06 Obligations of Company Unconditional................................................. 83
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TABLE OF CONTENTS
(continued)
PAGE
12.07 Notice by the Company................................................................ 83
12.08 Right as Holder of Senior Indebtedness............................................... 83
12.09 Reinstatement........................................................................ 83
12.10 Rights of Trustee and Paying Agent................................................... 84
12.11 Trust Moneys Not Subordinated........................................................ 84
12.12 No Subordination with respect to Collateral.......................................... 84
12.13 Trustee to Effectuate Subordination.................................................. 84
12.14 Trustee Not Fiduciary for Holders of Senior Indebtedness............................. 85
12.15 Reliance by Holders of Senior Indebtedness on Subordination Provisions............... 85
12.16 Trustee's Rights..................................................................... 85
ARTICLE XIII
SATISFACTION AND DISCHARGE
13.01 Satisfaction and Discharge........................................................... 85
13.02 Application of Trust Money........................................................... 86
ARTICLE XIV
MISCELLANEOUS
14.01 Trust Indenture Act Controls......................................................... 86
14.02 Notices.............................................................................. 86
14.03 Communication by Holders of Notes with Other Holders of Notes........................ 88
14.04 Certificate and Opinion as to Conditions Precedent................................... 88
14.05 Statements Required in Certificate or Opinion........................................ 88
14.06 Rules by Trustee and Agents.......................................................... 88
14.07 No Personal Liability of Directors, Officers, Employees and Stockholders............. 89
14.08 Governing Law........................................................................ 89
14.09 No Adverse Interpretation of Other Agreements........................................ 89
14.10 Successors........................................................................... 89
14.11 Severability......................................................................... 89
14.12 Counterpart Originals................................................................ 89
14.13 Table of Contents, Headings, etc..................................................... 89
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EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF NOTE GUARANTEE
Exhibit C FORM OF SUPPLEMENTAL INDENTURE
Exhibit D FORM OF PLEDGE AGREEMENT
Exhibit E FORM OF SECURITY AGREEMENT
Schedule G LIST OF GUARANTORS
vi
INDENTURE dated as of March____, 2004 (the "Agreement" or the
"Indenture") between AMERCO, a Nevada corporation (the "Company"), the
Guarantors and The Bank of New York, a New York banking corporation, as trustee
(the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the Notes:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 Definitions.
"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 that was not incurred in connection with, or in
contemplation of, such Person becoming a Restricted Subsidiary and (2) with
respect to the Company or any Restricted Subsidiary, any Indebtedness of a
Person (other than the Company or a Restricted Subsidiary) existing at the time
such Person is merged with or into the Company or a Restricted Subsidiary, or
Indebtedness expressly assumed by the Company or any Restricted Subsidiary in
connection with the acquisition of an asset or assets from another Person, which
Indebtedness was not, in any case, incurred by such other Person in connection
with, or in contemplation of, such merger or acquisition.
"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 referenced Person. 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
referenced 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, "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.
For the avoidance of doubt, SAC Holding shall not be deemed to be an Affiliate
of the Company for purposes of this Agreement.
"Agent" means any Registrar, Paying Agent or co-registrar..
"Agreement" means this Indenture, as amended or supplemented from time
to time.
"amend" means to amend, supplement, restate, amend and restate or
otherwise modify; and "amendment" shall have a correlative meaning.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary that apply to such transfer or exchange.
"Appraised Value" with respect to any asset means the fair market value
of such asset as determined in good faith by an independent third-party
appraiser, experienced in such appraisals and evidenced by a written appraisal
signed by such appraiser and delivered to the Company.
"AREC" means Amerco Real Estate Company, a Nevada corporation.
"asset" means any asset or property.
"Asset Acquisition" means (1) an Investment by the Company or any
Restricted Subsidiary of the Company in any other Person in a Permitted Business
if, as a result of such Investment, such Person shall become a Restricted
Subsidiary of the Company, or shall be merged with or into the Company or any
Restricted Subsidiary of the Company, or (2) the acquisition by the Company or
any Restricted Subsidiary of the Company of all or substantially all of the
assets of any other Person in a Permitted Business or any division or line of
business of any other Person that is a Permitted Business.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease,
assignment or other disposition by the Company or any Restricted Subsidiary to
any Person other than the Company 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 Company 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 hereof;
(3) Permitted Investments and Restricted Payments
permitted under Section 4.07 hereof;
(4) the creation or realization of any Permitted Lien;
(5) transfers of damaged, worn-out or obsolete equipment
or assets that, in the Company's reasonable judgment, are no longer
used or useful in the business of the Company or its Restricted
Subsidiaries;
(6) conveyance, sale, transfer, assignment or other
disposition of inventory and other assets acquired and held for resale
in the ordinary course of business;
(7) conveyance, sale, transfer, assignment or other
disposition by an Insurance Subsidiary of securities of Persons (other
than the Company or its Subsidiaries) constituting a portion of its
investment portfolio in the ordinary course of business consistent with
past practices;
(8) surrender or waiver of contract rights or settlement,
release or surrender of contract, tort or other litigation claims;
2
(9) grant in the ordinary course of business of any
non-exclusive license of patents, trademarks, registrations therefor
and other similar intellectual property;
(10) any transfer of the real property and improvements
covered by the Synthetic Leases;
(11) 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 $4.0 million during any fiscal year.
"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 Company'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 or state law for the relief of debtors.
"Board of Directors" means, with respect to any Person, the board of
directors or comparable governing body of such Person.
"Business Day" means a day other than a Saturday, Sunday or other day
on which banking institutions in The City of New York are authorized or required
by law to close.
"Capital Stock" means (1) in the case of a corporation, corporate
stock, (2) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited), and (4) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"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) marketable direct obligations issued or
unconditionally guaranteed by the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (2) marketable
direct obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either S&P or
▇▇▇▇▇'▇, (3) commercial paper maturing no more than
3
270 days from the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from ▇▇▇▇▇'▇, (4)
certificates of deposit or bankers' acceptances maturing within 1 year from the
date of acquisition thereof issued by any bank organized under the laws of the
United States or any state thereof having at the date of acquisition thereof
combined capital and surplus of not less than $250,000,000, (5) demand Deposit
Accounts maintained with any bank organized under the laws of the United States
or any state thereof so long as the amount maintained with any individual bank
is less than or equal to $100,000 and is insured by the Federal Deposit
Insurance Corporation, and (6) Investments in money market funds substantially
all of whose assets are invested in the types of assets described in clauses (1)
through (6) above .
"Change of Control" means: (1) any "person" or "group" (as such terms
are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or
more Permitted Persons, 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 more than 30% of the voting power of
the total outstanding Voting Stock of the Company; provided, however, that such
event shall not be deemed to be a Change of Control so long as the Permitted
Persons own Voting Stock representing in the aggregate a greater percentage of
the total voting power of the Voting Stock of the Company than such other person
or group; (2) 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 whose nomination for
election by the stockholders of the Company was approved by a vote of the
majority of the directors of the Company then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company; (3) (a) all or substantially
all of the assets of the Company and the Restricted Subsidiaries are sold or
otherwise transferred to any Person other than a Wholly-Owned Restricted
Subsidiary that is a Guarantor or (b) the Company consolidates or merges with or
into another Person or any Person consolidates or merges with or into the
Company, in either case under this clause (3), in one transaction or a series of
related transactions in which immediately after the consummation thereof Persons
owning Voting Stock representing in the aggregate a majority of the total voting
power of the Voting Stock of the Company immediately prior to such consummation
do not own Voting Stock representing a majority of the total voting power of the
Voting Stock of the Company or the surviving or transferee Person; or (4) the
Company shall adopt a Plan of Liquidation or plan of dissolution or any such
plan shall be approved by the stockholders of the Company.
"Collateral" means (i) the Oxford Stock, (ii) the Sale Property, (iii)
the Surplus Property, (iv) the Restated SAC Notes Escrow Account, (v) the
3.08(b) Account, (vi) the PWC Litigation Collateral (defined in the Security
Agreement), (vii) the Sale Agreements (defined in the Security Agreement),
(viii) the Pay Proceeds Agreements, (ix) any New SAC Notes and (x) proceeds
thereof, all as provided in and subject to the Security Documents.
"Collateral Agent" means The Bank of New York, in its capacity as
collateral agent under Section 11.06 of this Agreement, or any successor
thereto.
4
"Company" means AMERCO, and any and all successors thereto and not any
of its Subsidiaries.
"Consolidated Amortization Expense" for any period means the
amortization expense of the Company and the Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP.
"Consolidated Cash Flow" for any period means, without duplication, the
sum of the amounts for such period of (1) Consolidated Net Income Available For
Common Stock, 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 to the extent (and in the same proportion) as the Net Income of such Person
was included in the calculation of Consolidated Net Income, (a) Consolidated
Income Tax Expense, (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 the Consolidated Net Income (excluding any non-cash charge that
results in an accrual of a reserve for cash charges in any future period) for
such period, in each case determined on a consolidated basis in accordance with
GAAP, and (f) Consolidated Restructuring Charges, minus (3) the aggregate amount
of all non-cash items, determined on a consolidated basis, to the extent such
items increased Consolidated Net Income for such period, minus (4) cash payments
with respect to any non-cash charges previously added back pursuant to clause
2(e) above.
"Consolidated Depreciation Expense" for any period means the
depreciation expense of the Company and the Restricted Subsidiaries for such
period, including, without limitation, the amount of any impairment charge
required in such period in respect of any assets, all determined on a
consolidated basis in accordance with GAAP.
"Consolidated Income Tax Expense" for any period means the provision
for taxes of the Company 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 (for purposes of this definition, 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 (for
purposes of this definition, 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 Company or any Restricted Subsidiary (and
the application of the proceeds thereof) and any repayment of other
Indebtedness or redemption of 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
5
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 other disposition or Asset
Acquisition (including, without limitation, any Asset Acquisition
giving rise to the need to make such calculation as a result of the
Company 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, as if such
asset sale or Asset Acquisition or other disposition (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. In addition, for purposes of making the computation referred to
above, (i) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, and operations or
businesses disposed of prior to the Transaction Date, shall be
excluded, and (ii) the Consolidated Interest Expense attributable to
discontinued operations, as determined in accordance with GAAP, and
operations or businesses disposed of prior to the Transaction Date,
shall be excluded, but only to the extent that the obligations giving
rise to such Consolidated Interest Expense will not be obligations of
the referenced Person or any of its Subsidiaries following the
Transaction Date.
If the Company 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 Company or
such Restricted Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
In calculating Consolidated Interest Expense for purposes of
determining the denominator (but not the numerator) of the 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 Company and the Restricted
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP and including without duplication,
6
(1) imputed interest on Capitalized Lease Obligations and Attributable
Indebtedness, (2) commissions, discounts and other fees and charges owed with
respect to letters of credit securing financial obligations, bankers' acceptance
financing and receivables financings, (3) the net costs associated with Hedging
Obligations, (4) accretion of original issue discount and amortization of debt
issuance costs, debt discount or premium and other financing fees and expenses,
(5) the interest portion of any deferred payment obligations, (6) all other
non-cash interest expense, (7) capitalized interest, (8) the amount of any
Grossed-Up Preferred Dividends paid or accrued, (9) all interest payable with
respect to discontinued operations, and (10) all interest on any Indebtedness of
any other Person guaranteed by the Company or any Restricted Subsidiary or
secured by a Lien on the assets of the Company or its Restricted Subsidiaries
(whether or not such guarantee or Lien is called upon).
"Consolidated Net Income" for any period means the net income (or loss)
of the Company and the Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP; provided, however, 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 that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting, except to the extent that cash in an amount equal to any
such income has actually been received by the Company or any of its
Wholly-Owned Restricted Subsidiaries from such Person during such
period;
(2) except to the extent includible in the consolidated
net income of the Company 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 Company or any Restricted Subsidiary or (b) the
assets of such Person are acquired by the Company or any Restricted
Subsidiary;
(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, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary
during such period, except that the Company's equity in a net loss of
any such Restricted Subsidiary for such period shall be included in
determining Consolidated Net Income;
(4) 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 Company or any Restricted
Subsidiary upon (a) the acquisition of any securities, or the
extinguishment of any Indebtedness, of the Company or any Restricted
Subsidiary or (b) other than for purposes of calculating the Restricted
Payments Basket, any asset sale by the Company or any Restricted
Subsidiary;
(5) any extraordinary gain (or extraordinary loss),
together with any related provision for taxes on any such extraordinary
gain (or the tax effect of any such extraordinary loss), realized by
the Company or any Restricted Subsidiary during such period;
7
(6) the net effect of the write off of any deferred
financing charges resulting from the issuance of the Notes, the Term
Loan B Notes and the New Credit Agreement;
(7) the net income of any Person acquired in a pooling of
interests transaction for any period prior to the date of its
acquisition; and
(8) the cumulative effect of a change in accounting
principles.
In addition, any return of capital with respect to an Investment that
increased the Restricted Payments Basket pursuant to Section 4.07(a)(iii)(D)
hereof shall be excluded from Consolidated Net Income for purposes of
calculating the Restricted Payments Basket.
"Consolidated Net Income Available For Common Stock" for any period
means Consolidated Net Income of the Company and the Restricted Subsidiaries for
such period minus any amounts paid or accrued during such period by the Company
for the payment of dividends on its Preferred Stock.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the consolidated stockholders' equity of such Person, determined on a
consolidated basis in accordance with GAAP, less (without duplication) (1) any
amounts thereof attributable to Disqualified Equity Interests of such Person or
its Subsidiaries or any amount attributable to Unrestricted Subsidiaries and (2)
all write-ups (other than write-ups resulting from foreign currency translations
and write-ups of tangible assets of a going concern business made within 12
months after the acquisition of such business) subsequent to the Issue Date in
the book value of any asset owned by such Person or a Subsidiary of such Person.
"Consolidated Restructuring Charges" for any period means any
extraordinary and/or non-recurring consolidated charges of the Company,
representing restructuring charges, payments to restructuring financial advisors
and legal counsel and non-cash impairment of asset charges that were deducted in
arriving at Consolidated Net Income; provided, however, (a) the aggregate amount
of Consolidated Restructuring Charges calculated for the 3-month period ending
March 31, 2004 shall not exceed $75,000,000, (b) the aggregate amount of
Consolidated Restructuring Charges calculated for the 3-month period ending June
30, 2004 shall not exceed $3,800,000, (c) the aggregate amount of Consolidated
Restructuring Charges calculated for the 6-month period ending September 30,
2004 shall not exceed $7,500,000, (d) the aggregate amount of Consolidated
Restructuring Charges calculated for the 9-month period ending December 31, 2004
shall not exceed $11,300,000, and (e) the aggregate amount of Consolidated
Restructuring Charges calculated for the 12-month period ending March 31, 2005
and as of the end of each fiscal quarter thereafter shall not exceed
$15,000,000.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 14.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
8
"Dealership Contract" means a U-Haul dealership contract between a
Subsidiary of U-Haul, on the one hand, and a U-Haul Dealer, on the other hand.
"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.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A hereto, except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Deposit Accounts" means any Person's now owned or hereafter acquired
right, title and interest with respect to any "deposit account" as such term is
defined in the New York Uniform Commercial Code, as in effect from time to time,
including, without limitation, any any checking or other demand deposit account
maintained by the Company or the Guarantors.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Agreement.
"Depositary Custodian" means the Trustee, as custodian for the
Depositary with respect to the Notes in global form, or any successor entity
thereto.
"Designated Person" means (1) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇ or ▇▇▇▇▇
▇. ▇▇▇▇▇; (2) a member of the Board of Directors of the Company or a person that
was a member of the Board of Directors of the Company within the last three
years prior to the date of determination; (3) a current employee of the Company
or any of its Subsidiaries or a person that was an employee of the Company or
any of its Subsidiaries within the last three years prior to the date of
determination; (4) a spouse, parent, child, sibling, cousin, aunt, uncle,
mother-in-law, father-in-law, brother-in-law, sister-in-law, son-in-law or
daughter-in-law of any of the individuals referred to in clause (1), (2) or (3)
above, or any lineal descendant of any of the individuals referred to in this
clause (4) or in clause (1), (2) or (3) above; (5) any trust or other entity for
the primary benefit of the individuals referred to in clause (1), (2), (3) or
(4) above; or (6) any Affiliate of any of the Persons referred to in clause (1),
(2), (3), (4) or (5) above.
"Disqualified Equity Interests" of any Person means any class of Equity
Interest 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 are not
convertible, puttable or exchangeable for Disqualified Equity Interests or
9
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 is
convertible, exchangeable or exercisable) the right to require the Company to
redeem such Equity Interests upon the occurrence of a change in control
occurring prior to the final maturity date of the Notes shall not constitute
Disqualified Equity Interests if the change in control provisions applicable to
such Equity Interests are no more favorable to such holders than the provisions
described under Section 4.15 hereof and such Equity Interests specifically
provide that neither the Company nor any Subsidiary may or will be required to
redeem any such Equity Interests pursuant to such provisions prior to the
Company's purchase of the Notes as required by the provisions of Section 4.15
hereof.
"Dormant Subsidiaries" means, collectively, EJOS, Inc., an Arizona
corporation, Japal, Inc., a Nevada corporation, M.V.S., Inc., a Nevada
corporation, Pafran, Inc., a Nevada corporation, Sophmar, Inc., a Nevada
corporation, and Picacho Peak Investments Co., a Nevada corporation.
"ECF Carry Forward Amount" means the amount determined in accordance
with the definition of "ECF Carry Forward Amount" then in effect under the New
Credit Agreement, provided that if the New Credit Agreement has been terminated,
the amount shall be determined in accordance with the definition of "ECF Carry
Forward Amount" in effect on the date the New Credit Agreement was terminated.
"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 equity interests in such Person.
"Escrowed Restated SAC Notes" means the Restated SAC Holding Notes
deposited in the Restated Notes Escrow as provided in Section 11.05 hereof.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as
amended.
"Excluded Sale and Leaseback Transaction" means any sale and leaseback
transaction in respect of trucks, trailers and related specialty rental items
that, in each case, occur within 130 days after the initial acquisition thereof
by the Company or the applicable Subsidiary of the Company sold to another
Person and rented or leased from such Person by the Company or any of its
Subsidiaries.
"Exempted Affiliate Transaction" means (1) customary employment
agreements and compensation and benefit arrangements with employees, officers,
directors or consultants entered into by the Company or any of its Subsidiaries
in the ordinary course of business of the Company or such Subsidiary, (2)
Restricted Payments that are permitted by Section 4.07, (3) the provision of
administrative or management services by the Company or any of its officers to
any
10
of its Subsidiaries in the ordinary course of business, (4) any transactions
with the AMERCO Employee Savings, Profit Sharing and Employee Stock Ownership
Plan in the ordinary course of business consistent with past practices and (5)
any transactions between the Company or any of its Subsidiaries and Affiliates
of the Company for the provision of printing and related services on terms that
are no less favorable to the Company or the relevant Subsidiary than those that
would have been obtained in a comparable transaction with an unrelated party on
an arms' length basis and consistent with past practices; provided, that the
aggregate amount paid by the Company and its Subsidiaries in any twelve month
period shall not exceed $5.0 million.
"Exempted Designated Person Transaction" means any of the following:
(1) payments of principal and interest made by SAC
Holding to the Company or one of its Subsidiaries pursuant to the
Restated SAC Holding Notes;
(2) payments by Designated Persons to the Company or any
of its Subsidiaries pursuant to Management Agreements existing on the
Issue Date between Designated Persons and the Company or any of its
Subsidiaries;
(3) the entering into of Management Agreements after the
Issue Date (and payments by Designated Persons to the Company or any of
its Subsidiaries pursuant to the terms of such agreements) between
Designated Persons and the Company or any of its Subsidiaries in the
ordinary course of business, on terms that are no less favorable than
those that could have been obtained in a comparable transaction on an
arms' length basis with an unrelated third party;
(4) transactions pursuant to Dealership Contracts
existing on the Issue Date between Designated Persons and the Company
or any of its Subsidiaries;
(5) the entering into of Dealership Contracts after the
Issue Date (including payments by Designated Persons to the Company or
any of its Subsidiaries pursuant to the terms of such contracts)
between Designated Persons and the Company or any of its Subsidiaries
in the ordinary course of business, on terms that are no less favorable
than those that could have been obtained in a comparable transaction on
an arms' length basis with an unrelated third party;
(6) transactions pursuant to the lease agreements
existing on the Issue Date between Designated Persons and the Company
or any of its Subsidiaries demising certain marketing company office
space, shop space or hitch-bay installation space;
(7) the entering into of lease agreements after the Issue
Date (including payments to be made pursuant to the terms of such
agreements) between Designated Persons and the Company or any of its
Subsidiaries to demise marketing company office space, shop space or
hitch-bay installation space in the ordinary course of business, on
terms that are no less favorable than those that could have been
obtained in a comparable transaction on an arms' length basis with an
unrelated third party s;
(8) the granting of easements, rights-of-way, servitudes
and other similar encumbrances that do not materially impact the value
of the property, and the conveyance
11
of fee title (to correct title defects) of properties previously
conveyed to Designated Persons, but omitted in the conveyance due to
scrivener's error, error in legal description and similar mistakes;
(9) transactions which constitute Permitted Investments;
(10) transactions pursuant to Fleet Owner Contracts
existing on the Issue Date between Designated Persons and the Company
or any of its Subsidiaries;
(11) the entering into of Fleet Owner Contracts after the
Issue Date (including payments by Designated Persons to the Company or
any of its Subsidiaries pursuant to the terms of such contracts)
between Designated Persons and the Company or any of its Subsidiaries
in the ordinary course of business, on ordinary market terms and
consistent with past practices; and
(12) transactions described in clause (5) of the
definition of "Exempted Affiliate Transaction."
"Fair Market Value" with respect to any asset or item not involving an
Affiliate Transaction means the Fair Market Value of such asset or item as
determined in good faith by the Board of Directors of the Company and evidenced
by a Board of Directors resolution delivered to the Trustee. The "Fair Market
Value" of any asset or item in excess of $10.0 million and involving an
Affiliate Transaction means the Fair Market Value of any asset or item as
determined by a majority of the Independent Directors and as evidenced by a
resolution of the Independent Directors delivered to the Trustee.
"Fleetowner Contracts" means those certain fleet owner contracts
between Designated Persons and U-Haul under which U-Haul is granted the right to
use and rent to customers, as part of U-Haul's rental fleet, trailers as to
which Designated Persons own undivided interests, in exchange for a fee payable
to the applicable Designated Person.
"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.
"Global Note Legend" means the legend set forth in Section 2.06(f),
which is required to be placed on all Global Notes issued under this Agreement.
"Global Notes" means, individually and collectively, each of the Global
Notes, substantially in the form of Exhibit A hereto, issued in accordance with
Section 2.01, 2.02, or 2.06(d) hereof.
"Grossed-Up Preferred Dividends" means the product of (a) all dividend
payments on any series of Disqualified Equity Interests of the Company or any
Preferred Stock of any Restricted Subsidiary (other than any such Disqualified
Equity Interests or any Preferred Stock held by the Company or a Wholly-Owned
Restricted Subsidiary), multiplied by (b) a fraction,
12
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 Company and
the Restricted Subsidiaries, expressed as a decimal.
"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 obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part). The terms "guarantee," when used as a verb, and "guaranteed" have
correlative meanings.
"Guarantor" and "Guarantors" means all direct and indirect Subsidiaries
of the Company, except for the Insurance Subsidiaries, any Subsidiary formed
under the laws of a jurisdiction outside of the United States and Canada,
Storage Realty, L.L.C., a Texas limited liability company, INW, and the Dormant
Subsidiaries. For the avoidance of doubt, SAC Holding shall not be a Guarantor
under this Agreement. As of the Issue Date, all Guarantors are listed on
Schedule G hereto.
"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 designed to protect such
Person against fluctuations in interest rates, (2) agreements or arrangements
designed to protect such Person against fluctuations in foreign currency
exchange rates in the conduct of its operations, or (3) any forward contract,
commodity swap agreement, commodity option agreement or other similar agreement
or arrangement designed to protect such Person against fluctuations in commodity
prices.
"Holder" means a Person in whose name a Note is registered.
"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, however, that (1) the Indebtedness of a Person existing at
the time such Person became a Restricted Subsidiary or was merged with or into
the Company or a Restricted Subsidiary shall be deemed to have been incurred by
the Company or such Restricted Subsidiary, as applicable, 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 of such Person, contingent or otherwise, 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, contingent or
otherwise, of such Person evidenced by bonds, debentures, notes or other similar
instruments; (3) all obligations, contingent or otherwise, of such Person in
respect of letters of credit or other similar instruments (or reimbursement
obligations with respect thereto); (4) all obligations, contingent or otherwise,
of such Person to pay the deferred and
13
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) Disqualified Equity
Interests of such Person with a value equal to the maximum fixed redemption or
repurchase price of all such Disqualified Equity Interests, contingent or
otherwise; (6) all Capitalized Lease Obligations of such Person, contingent or
otherwise; (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, however, that Indebtedness of the Company or its
Subsidiaries that is guaranteed by the Company or the Company's Subsidiaries
shall only be counted once in the calculation of the amount of Indebtedness of
the Company and its Subsidiaries on a consolidated basis; (9) all Attributable
Indebtedness; (10) Hedging Obligations of such Person; (11) all obligations of
such Person, contingent or otherwise, under conditional sale or other title
retention agreements relating to assets purchased by such Person; and (12) all
banker's acceptances of such person.
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 Agreement,
whether or not such redemption or repurchase is then permitted pursuant to the
terms of such Disqualified Equity Interests.
For the avoidance of doubt, "Indebtedness" of any Person shall not
include operating leases incurred in the ordinary course of business, or any
guarantee by the Company or any Subsidiary of the Company of the obligations of
any Guarantor thereunder.
"Independent Director" means a director of the Company who (1) is
independent with respect to the transaction at issue; (2) does not have any
material financial interest in the Company or any of its Affiliates (other than
as a result of holding securities of the Company); and (3) has not and whose
Affiliates have not, at any time during the 12 months prior to the taking of any
action hereunder, directly or indirectly, received, or entered into any
understanding or agreement to receive, any compensation, payment or other
benefit, of any type or form, from the Company or any of its Affiliates, other
than customary directors' fees for serving on the Board of Directors of the
Company or any Affiliate and reimbursement of out-of-pocket expenses for
attendance at the Company's or Affiliate's board and board committee meetings.
"Insurance Subsidiaries" means RepWest and Oxford, and their respective
direct and indirect Subsidiaries.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
14
"interest" means, with respect to the Notes, 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
(other than commissions, travel and similar advances made to directors, officers
and employees in the ordinary course of business) 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; (3) all other items that would be
classified as investments 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 4.16. If the Company 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 Company 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 Company or any Restricted Subsidiary of a Person that holds
an Investment in a third Person shall be deemed to be an Investment by the
Company 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 Company shall be deemed not to be Investments.
"INW" means INW Company, a Washington corporation.
"Issue Date" means the date on which the Notes are originally issued
under this Indenture.
"Joint Venture" means a corporation, partnership or other entity
engaged in one or more of the Permitted Businesses in which the Company or its
Restricted Subsidiaries does not have control but owns, directly or indirectly,
at least 10% of the Equity Interests.
"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
agreement, any lease in the nature thereof, any option or other agreement to
sell or give a security interest in, and any filing of, or agreement to give,
any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction (other than cautionary filings in respect of
operating leases).
15
"Management Agreements" means, collectively, those certain property
management agreements between Subsidiaries of U-Haul, on the one hand, and
subsidiaries of SAC Holding or other persons on the other hand.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., and its successors.
"Mortgage" means a mortgage, deed of trust, assignment of leases and
rents or other security document granting a Lien on the Sale Property or the
Surplus Property to the Collateral Agent, for the benefit of the Secured
Parties.
"Net Available Proceeds" means, with respect to any Asset Sale, the
proceeds thereof in the form of cash or Cash Equivalents (including, without
limitation, any cash received upon the sale or other disposition of non-cash
consideration received in such Asset Sale), net of (1) brokerage commissions and
other fees and expenses (including, without limitation, title insurance fees and
premiums, appraisal fees, environmental evaluation and report fees, and fees and
expenses of legal counsel, accountants and investment banks) of such Asset Sale;
(2) provisions for current or future 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 Company or any Restricted Subsidiary) owning a beneficial interest in
the assets subject to the Asset Sale or having a Lien thereon; (4) amounts
required to be paid from the proceeds of such Asset Sale under the terms of any
Senior Indebtedness; (5) 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 (6) appropriate amounts to be provided
by the Company or any Restricted Subsidiary, as the case may be, as a reserve
required in accordance with GAAP against any liabilities associated with such
Asset Sale and retained by the Company or any Restricted Subsidiary, as the case
may be, after such Asset Sale, including pensions and other postemployment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with such Asset
Sale, all as reflected in an Officer's Certificate delivered to the Trustee;
provided, however, that any amounts remaining after adjustments, revaluations or
liquidations of such reserves shall constitute Net Available Proceeds.
"Net PWC Litigation Recovery" means the gross amount of (x) any
settlement payments or (y) any final and non-appealable damage awards actually
received by the Company from or on behalf of the defendants in the PWC
Litigation, less (i) all attorneys' fees and costs, court costs expert witness
fees and expenses and other similar costs and expenses paid or payable by the
Company with respect to the PWC Litigation; and (iii) any current or future
taxes paid or payable by the Company with respect to such settlement payments or
damage awards (after taking into account any available tax credits or deductions
and any tax sharing arrangements).
"New Credit Agreement" means the Loan and Security Agreement dated as
of________, 2004 by and among ▇▇▇▇▇ Fargo Foothill, Inc., as administrative
agent, the banks party thereto, the Company and the Guarantors, together with
any additional guarantees by the Guarantors and security agreements, as any of
the foregoing may be subsequently amended, restated, refinanced, extended or
replaced from time to time whether by the same or any other agent, lender or
group of lenders, and shall include agreements in respect of Hedging Obligations
designed to protect against fluctuations in interest rates and entered into with
respect to loans thereunder.
16
"New SAC Notes" means any New Notes (as defined in the Restated SAC
Holding Notes) that may be issued pursuant to the Restated SAC Holding Notes.
"Non-Recourse Debt" means Indebtedness of an Unrestricted Subsidiary:
(1) as to which neither the Company 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 Company or any Restricted Subsidiary to declare a default
on such 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 Company or any Restricted Subsidiary.
"Non-Recourse Purchase Money Indebtedness" means Indebtedness of the
Company or any of its Subsidiaries (a) incurred to finance the purchase of any
assets of the Company or any of its Subsidiaries within 130 days of such
purchase, (b) to the extent the amount of Indebtedness thereunder does not
exceed 100% of the purchase cost of such assets, (c) to the extent the purchase
cost of such assets is or should be included in "additions to property, plant
and equipment" in accordance with GAAP, and (d) to the extent that such
Indebtedness is non-recourse to the Company or any of its Subsidiaries or any of
their respective assets other than the assets so purchased.
"Note Guarantee" means the guarantee by each Guarantor of the Company's
payment and performance of all obligations under this Agreement and on the
Notes, executed pursuant to the provisions of this Agreement.
"Notes" means the $________ of 12% Senior Subordinated Secured Notes
due 2011 to be issued on the Issue Date in accordance with this Agreement.
"Obligation" means any principal, interest, penalties, fees,
indemnifications, reimbursements, costs, expenses, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Officer" means any of the following of the Company: the Chairman of
the Board of Directors, the Chief Executive Officer, the Chief Financial
Officer, the President, any Vice President, the Treasurer, the Secretary, the
Assistant Treasurer or the Assistant Secretary.
"Officer's Certificate" means a certificate signed by an Officer that
meets the requirements of Section 14.04(a).
17
"Opinion of Counsel" means an opinion of counsel that meets the
requirements of Section 14.04(b).
"Oxford" means Oxford Life Insurance Company, an Arizona corporation.
"Oxford Stock" means all of the issued and outstanding Capital Stock of
Oxford.
"Pay Proceeds Agreements" means the Pay Proceeds Agreements defined in
the Security Agreement, substantially in the form of Exhibit __ to the Security
Agreement, among the Company, certain of the Guarantors, the makers of the
Escrowed Restated SAC Notes and the Collateral Agent, for the benefit of the
Secured Parties.
"Pari Passu Indebtedness" means any Indebtedness of the Company or any
Guarantor that ranks pari passu as to payment with the Notes or the Note
Guarantees, as applicable.
"Participant" means, with respect to the Depositary, a Person who has
an account with the Depositary.
"Permitted Business" means the businesses engaged in or proposed to be
engaged in by the Company and its Subsidiaries on the Issue Date and businesses
that are reasonably related thereto or reasonable extensions or expansions
thereof.
"Permitted Easements" means (1) easements, licenses, rights-of-way and
other rights and privileges in the nature of easements reasonably necessary or
desirable for the use, repair, or maintenance of any real property and (2) if
required by a governmental authority, the dedication or transfer of unimproved
portions of any real property for road, highway or other public purposes; so
long as, in each case (i) such grant, dedication or transfer does not materially
impair the value of the remaining useful life of the applicable real property or
the fair market value of such real property or materially impair or interfere
with the use or operations thereof, and (ii) such grant, dedication or transfer
is reasonably necessary in connection with the use, maintenance, alteration or
improvement of the applicable real property.
"Permitted Investment" means:
(1) (a) Investments by the Company or any Restricted
Subsidiary in any Restricted Subsidiary that is a Guarantor or (b)
payments by the Company or any Restricted Subsidiary to any Person or
Persons solely as consideration for the acquisition of Equity Interests
or assets of any Person that is or will become immediately after such
Investment a Restricted Subsidiary that is a Guarantor;
(2) Investments in the Company by any Restricted
Subsidiary;
(3) loans and advances to employees of the Company and
the Restricted Subsidiaries in respect of commissions, business
expenses, travel and relocation and other similar expenses in the
ordinary course of business;
(4) Hedging Obligations incurred in accordance with
Section 4.09(b)(iv) hereof;
18
(5) Cash Equivalents;
(6) receivables owing to the Company or any Restricted
Subsidiary if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary
trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(7) Investments in stock, obligations or securities of
trade creditors or customers received in the ordinary course of
business in satisfaction of judgments, in settlement of debts or
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 Company or any Restricted
Subsidiary as a result of non-cash consideration received in connection
with an Asset Sale made in compliance with Section 4.10 hereof;
(9) lease, utility, bank, escrow, ▇▇▇▇▇▇▇ money deposits
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 Company or any Restricted Subsidiary or in satisfaction of
judgments;
(11) Investments by any Insurance Subsidiary made in the
ordinary course of business consistent with past practice;
(12) Investments in negotiable instruments for collection;
(13) advances made in connection with purchases of goods
or services in the ordinary course of business;
(14) Investments by U-Haul and Nationwide Commercial Co.
evidenced by the Restated SAC Holding Notes not to exceed the principal
amount outstanding thereunder as of the Issue Date (except for increase
in principal resulting solely from the accrual of interest thereon);
(15) payments by U-Haul and its Subsidiaries of expenses
on behalf of Subsidiaries of SAC Holding or other Persons pursuant to
the Management Agreements provided that all such expenses are promptly
reimbursed by the other appropriate parties to the Management
Agreement;
(16) Investments in PM Preferred or any of its Affiliates
owned by the Company or any of its Subsidiaries or SAC Holding under
the Support Party Agreement;
(17) payments by U-Haul and its Subsidiaries in the
ordinary course of business and consistent with past practices of
certain ordinary course operating expenses on behalf of any U-Haul
Dealer pursuant to a Dealership Contract, provided that the
19
applicable U-Haul Dealer reimburses U-Haul and its Subsidiaries for all
such expenses in accordance with the provisions of the Dealership
Contract;
(18) Investments in the Notes, the Term Loan B Notes, the
SAC Holding Senior Notes and Indebtedness of PMSR resulting from the
acquisition of such instruments by the Company in accordance with the
terms of the PMSR Agreement;
(19) Investments existing on the Issue Date; and
(20) other Investments in an aggregate amount not to
exceed $10.0 million per year (with each Investment being valued as of
the date made and without regard to subsequent changes in value).
"Permitted Liens" means the following types of Liens:
(1) 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;
(2) 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;
(3) leases or subleases granted to others that do not
materially interfere with the ordinary course of business of the
Company or any Restricted Subsidiary;
(4) Liens arising from filing Uniform Commercial Code
financing statements regarding leases;
(5) Liens securing all of the Notes and Liens securing
any Note Guarantee;
(6) Liens existing on the Issue Date securing
Indebtedness outstanding on the Issue Date, including, without
limitation, the Term Loan B Notes;
(7) Liens in favor of the Company or a Guarantor;
(8) Liens securing Indebtedness and other "Obligations"
(as defined in the New Credit Agreement) and the obligations under the
Loan Documents (as defined in the New Credit Agreement);
(9) Liens securing Acquired Indebtedness permitted to be
incurred under this Agreement; provided, however, that the Liens do not
extend to assets not subject to such Lien at the time of acquisition
(other than improvements thereon) and are no more favorable to the
lienholders than those securing such Acquired Indebtedness prior to the
incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary;
20
(10) Liens to secure Refinancing Indebtedness provided,
however, that such Liens do not extend to any additional assets which
were not subject to Liens securing Refinanced Indebtedness (other than
improvements thereon and replacements thereof) and do not have a higher
priority than the Liens securing the applicable Refinanced Indebtedness
except that in the case of a concurrent refinancing of multi-priority
Indebtedness, the Refinancing Indebtedness may retain the highest
priority applicable to the Refinanced Indebtedness.
(11) Liens to secure Attributable Indebtedness incurred
pursuant to Section 4.19 hereof; provided, however, that any such Lien
shall not extend to or cover any assets of the Company 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;
(12) Liens imposed by governmental authorities for taxes,
assessments or other charges not yet subject to penalty or which are
being contested in good faith and by appropriate proceedings promptly
instituted and diligently conducted and, if any reserve or other
provision is required in accordance with GAAP, adequate reserves with
respect thereto shall have been made on the books of the Company in
accordance with GAAP;
(13) statutory liens of carriers, warehousemen, mechanics,
materialmen, landlords, repairmen or other like Liens arising by
operation of law in the ordinary course of business provided that (1)
the underlying obligations are not overdue for a period of more than 60
days, or (2) such Liens are being contested in good faith and by
appropriate proceedings promptly instituted and diligently conducted
and adequate reserves with respect thereto are maintained on the books
of the Company in accordance with GAAP;
(14) Liens securing the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business (including, without limitation, landlord liens on leased
property);
(15) Liens in respect of Permitted Easements;
(16) Liens arising by operation of law in connection with
judgments, only to the extent, for an amount and for a period not
resulting in an Event of Default with respect thereto;
(17) pledges or deposits made in the ordinary course of
business in connection with worker's compensation, unemployment
insurance and other types of social security legislation;
(18) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual or warranty
requirements;
(19) Liens arising out of consignment or similar
arrangements for the sale of goods;
21
(20) any condemnation or eminent domain proceedings
affecting any real property;
(21) Liens set forth on Schedule P-1 to the New Credit
Agreement as of the Issue Date;
(22) the interests of lessors under operating leases and
under the Synthetic Leases, including any refinancings thereof;
(23) Liens incurred in the ordinary course of business of
the Company or any Restricted Subsidiary with respect to obligations
(other than Indebtedness) that do not in the aggregate exceed $10
million at any one time outstanding; and
(24) purchase money Liens or the interests of lessors in
leased assets under Capitalized Leases to the extent that such Liens or
interests secure Purchase Money Indebtedness permitted hereunder and so
long as such Liens attach only to the asset purchased or acquired and
the proceeds thereof.
Notwithstanding the foregoing, Liens with respect to
Collateral under clauses (6), (8), (9), (10), (11), (21), (22), (23)
and (24) shall not be Permitted Liens.
"Permitted Person" means (i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇ and the spouse and lineal descendants of each such individual, the spouses
of each such lineal descendant and the lineal descendants of such spouses; (ii)
any trusts or other entities for the primary benefit of, the executor or
administrator of the estate of, or other legal representative of, any of the
individuals referred to in clause (i); (iii) any corporation or other entity
with respect to which all the Voting Stock thereof is, directly or indirectly
owed by any of the individuals or entities referred to in clauses (i) and (ii);
and (iv) the AMERCO Employee Savings and Employee Stock Ownership Trust, or any
successor thereto.
"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 remaining assets of such Person to holders of Equity
Interests of such Person.
"Pledge Agreement" means the Pledge Agreement, substantially in the
form of Exhibit D hereto, among the Company, certain of the Guarantors and the
Collateral Agent, for the benefit of the Secured Parties. "PM Preferred" means
PM Preferred Properties, L.P., a Texas limited partnership.
22
"PMSR" means Private Mini Storage Realty, L.P., a Texas limited
partnership.
"PMSR Agreement" means that certain PMSR Agreement dated as of [
,2004], among AMERCO, PMSR, JPMorgan Chase Bank, as Administrative Agent under
the Credit Agreement described therein and the lenders under the Credit
Agreement described therein.
"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 the
Notes.
"Purchase Money Indebtedness" means Indebtedness of the Company or any
of its Subsidiaries (including Capitalized Leases) (a) incurred to finance the
purchase of any assets of the Company or any of its Subsidiaries within 130 days
of such purchase, (b) to the extent the amount of Indebtedness thereunder does
not exceed 100% of the purchase cost of such assets, and (c) to the extent the
purchase cost of such assets is or should be included in "additions to property,
plant and equipment" in accordance with GAAP.
"PWC Litigation" means the pending action filed by AMERCO against
PricewaterhouseCoopers LLP and the other defendants named therein in the
Maricopa County Superior Court of the State of Arizona, Case No. CV-2003-011032.
"Qualified Equity Interests" means Equity Interests of the Company
other than Disqualified Equity Interests; provided, however, that such Equity
Interests shall not be deemed Qualified Equity Interests to the extent sold or
owed to a Subsidiary of the Company or financed, directly or indirectly, using
funds (1) borrowed from the Company or any Subsidiary of the Company until and
to the extent such borrowing is repaid or (2) contributed, extended, guaranteed
or advanced by the Company or any Subsidiary of the Company (including, without
limitation, in respect of any employee stock ownership or benefit plan).
"redeem" means to redeem, repurchase, purchase, defease, retire,
discharge or otherwise acquire or retire for value; and "redemption" shall have
a correlative meaning.
"refinance" means to refinance, repay, prepay, replace, renew or
refund.
"Refinancing Indebtedness" means Indebtedness of the Company 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 Company or any Restricted Subsidiary (the "Refinanced
Indebtedness") in a principal amount not in excess of the outstanding principal
amount (plus the amount of any capitalized fees and, with respect to any
refinancing of the Synthetic Leases, to the extent permitted under Section
4.09(b)(iv)(B)) 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, however, that:
23
(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) if the Refinanced Indebtedness was Disqualified
Equity Interests, then such Refinancing Indebtedness consists solely of
Disqualified Equity Interests;
(4) 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;
(5) 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 (other than such changes in the Weighted
Average Life to Maturity of the Synthetic Leases, to the extent they
are treated as Capitalized Leases in accordance with GAAP, resulting
from the refinancing of the Synthetic Leases); and
(6) 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 and pursuant to Liens that do not
have a higher priority than the Liens securing the Refinanced
Indebtedness except that in the case of a concurrent refinancing of
multi-priority Indebtedness, the Refinancing Indebtedness may retain
the highest priority applicable to the Refinanced Indebtedness.
Notwithstanding the foregoing, clauses (4) and (5) of this definition
shall not apply to any refinancing of Senior Indebtedness.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Finance Unit of the Corporate Trust Division of the
Trustee (or any successor group of the Trustee) who has direct responsibility
for the administration of this Indenture and, for purposes of Section
7.01(c)(ii) and the second sentence of Section 7.06, shall also include any
other officer of the Trustee to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"RepWest" means Republic Western Insurance Company, an Arizona
corporation.
"Restated Notes Escrow" means the escrow arrangement established with
respect to the Escrowed Restated SAC Notes pursuant to Section 11.05 hereof.
24
"Restated SAC Notes Escrow Account" means a segregated account for the
receipt of payments made pursuant to the Escrowed Restated SAC Notes as provided
in Section 11.05 hereof.
"Restated SAC Notes Escrow Agreement" means the Restated SAC Notes
Escrow Agreement, substantially in the form of Exhibit ___ hereto, among the
Company, certain of the Guarantors and the Collateral Agent, for the benefit of
the Secured Parties.
"Restated SAC Holding Notes" means the promissory notes as restated and
in effect on the date hereof issued to Subsidiaries of the Company by SAC
Holding and identified as collateral for the Notes in the Security Agreement and
deposited in the Restated Notes Escrow as provided in Section 11.05, hereof.
"Restricted Payment" means any of the following:
(1) the declaration or payment of any dividend or any
other distribution on Equity Interests of the Company or any Restricted
Subsidiary or any payment made in respect of Equity Interests to the
direct or indirect holders of Equity Interests of the Company or any
Restricted Subsidiary, including, without limitation, any payment in
connection with any merger or consolidation involving the Company 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 Company 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 Company
or any Restricted Subsidiary, including, without limitation, any
payment in connection with any merger or consolidation involving the
Company or any Restricted Subsidiary but excluding any such Equity
Interests held by the Company 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.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Revolving Loan Facility" means the revolving loan facility provided
under the New Credit Agreement.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors.
"SAC Holding" means, collectively, SAC Holding Corporation and SAC
Holding II Corporation, each a Nevada corporation.
25
"SAC Holding Senior Notes" means those 8.5% Senior Notes due 2014
issued pursuant to the Indenture dated as of ___________, 2004, among SAC
Holding, and ___________, as trustee thereunder.
"Sale and Leaseback Transaction" 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; provided that the term "Sale and Leaseback Transaction" shall not
include any Excluded Sale and Leaseback Transaction.
"Sale Property" means that certain real property defined as such in the
Security Agreement.
"SEC" means the U.S. Securities and Exchange Commission.
"Secretary's Certificate" means a certificate signed by the Secretary
or an Assistant Secretary of the Company.
"Secured Parties" shall have the meaning assigned to such term in the
Security Agreement.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Security Agreement" means the Security Agreement, substantially in the
form of Exhibit E hereto, among the Company, certain of the Guarantors and the
Collateral Agent, for the benefit of the Secured Parties.
"Security Documents" means, collectively, the Security Agreement, the
Pledge Agreement, the Pay Proceeds Agreement, the Mortgages and all other
agreements, instruments, documents, pledges or filings executed in connection
with granting, or that otherwise evidence, the Lien of the Collateral Agent in
the Collateral.
"Senior Indebtedness" means the Obligations of the Company and the
Guarantors under (i) the New Credit Agreement and the other "Loan Documents" (as
defined in the New Credit Agreement) and (ii) the Term Loan B Notes.
"Senior Secured Term Loan Facility" means the term loan facility
providing for the senior secured term loan under the New Credit Agreement.
"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 Section 6.01(g) and (h) hereof has occurred and is
continuing, would constitute a Significant Subsidiary under clause (1) of this
definition.
26
"SSI" means Self-Storage International Holding Corporation, a Nevada
corporation, and any Subsidiary thereof, whether now existing or hereafter
formed.
"Subordinated Indebtedness" means Indebtedness of the Company 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 is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and (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); provided,
however, that PMSR, PM Preferred, SAC Holding and SSI shall not be deemed to be
Subsidiaries of the Company or any Guarantor. Unless otherwise specified,
"Subsidiary" refers to a Subsidiary of the Company.
"Support Party Agreement" means that certain Support Party Agreement
dated as of February 28, 2003 by and between AMERCO and PM Preferred in favor of
GMAC Commercial Holding Corp., as administrative agent, as amended by the First
Amendment to Support Party Agreement dated as of June 13, 2003, in each case as
amended prior to the Issue Date and after the Issue Date as permitted herein
(provided, in each case, such amendment does not increase the obligations of any
Loan Party as defined thereunder).
"Surplus Property" means that certain real property defined as such in
the Security Agreement.
"Synthetic Leases" means, collectively, (i) that certain Amended and
Restated Master Lease and Open-End Mortgage dated as of July 27, 1999 among
U-Haul, AREC, the various lessors identified therein and BMO Global Solutions,
Inc. and any related documentation, (ii) that certain Master Lease dated as of
September 24, 1999 between BMO Global Capital Solutions, Inc. and AREC and any
related documentation; and (iii) that certain Canadian U-Haul Master Lease dated
as of April 5, 2001 between Computershare Trust Company of Canada, as successor
to Montreal Trust Company of Canada, and U-Haul (Canada) and any related
documentation, each as may be subsequently amended, restated or refinanced to
the extent permitted hereunder.
"Term Loan B Notes" means those 9.0% Second Lien Senior Secured Notes
due 2009 issued pursuant to the Indenture dated as of ____________, 2004, among
the Company, the Guarantors and ▇▇▇▇▇ Fargo Bank, N.A., as trustee thereunder,
as subsequently amended, restated, refinanced, extended or replaced from time to
time.
"TIA" means the Trust Indenture Act of 1939, as amended.
27
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Agreement and
thereafter means the successor serving hereunder.
"U-Haul" means U-Haul International, Inc., a Nevada corporation.
"U-Haul (Canada)" means U-Haul Co. (Canada) Ltd., an Ontario
corporation.
"U-Haul Dealer" means any Person that leases Vehicles on behalf of
U-Haul in the ordinary course of business pursuant to a Dealership Contract.
"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 Company in accordance with Section 4.16 hereof 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.
"Vehicle" or "Vehicles" means any vehicle (including any motor
vehicle), trailer or other asset of the Company or its Restricted Subsidiaries
represented by a certificate of title.
"Voting Stock" with respect to any Person, means securities of any
class of Equity Interests 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
Company or through one or more Wholly-Owned Restricted Subsidiaries.
"WPCarey Transaction" means the transaction whereby UH Storage (DE)
Limited Partnership, a Delaware limited partnership, or other Affiliate of W.P.
▇▇▇▇▇ & Co., LLC, will acquire the real property that is subject to the
Synthetic Leases (excluding real property located in Canada) and such Synthetic
Leases shall be paid in full and terminated, all as more fully set forth on
Schedule W-1 to the New Credit Agreement.
1.02 Other Definitions.
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Defined in
Term Section
---- -------
"Affiliate Transaction" 4.11
"Alternate Offer" 4.15
"Authentication Order" 2.02
"Authorized Agent" 14.10
"Change of Control Offer" 4.15
"Change of Control Payment Date" 4.15
"Change of Control Purchase Price" 4.15
"Covenant Defeasance" 8.03
"Coverage Ratio Exception" 4.09
"Designation" 4.16
"Designation Amount" 4.16
"DTC" 2.03
"Environmental Law" 7.07
"Event of Default" 6.01
"Excess Proceeds" 4.10
"Hazardous Materials" 7.07
"Insolveny Event" 12.02
"Legal Defeasance" 8.02
"Net Proceeds Deficiency" 4.10
"Net Proceeds Offer" 4.10
"Offered Price" 4.10
"Pari Passu Indebtedness Price" 4.10
"Paying Agent" 2.03
"Payment Amount" 4.10
"Permitted Indebtedness" 4.09
"Redesignation" 4.16
"Registrar" 2.03
"Restricted Payments Basket" 4.07
"Successor" 5.01
"3.08(b) Account" 3.08
1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Agreement refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Agreement.
The following TIA terms used in this Agreement have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Agreement;
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"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Note Guarantees means the Company and
the Guarantors, respectively, and any successor obligor upon the Notes and the
Note Guarantees, respectively.
All other terms used in this Agreement that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
The provisions of TIA Sections 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture
upon and so long as the Indenture and Notes are subject to the TIA. If any
provision of this Indenture limits, qualifies or conflicts with such duties, the
imposed duties shall control. If a provision of the TIA requires or permits a
provision of this Indenture and the TIA provision is amended, then the Indenture
provision shall be automatically amended to like effect.
1.04 Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the
plural include the singular;
(e) "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;
(f) provisions apply to successive events and
transactions; and
(g) references to sections of or rules under the
Securities Act shall be deemed to include substitute, replacement of
successor sections or rules adopted by the SEC from time to time.
ARTICLE II
THE NOTES
2.01 Form and Dating.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or
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endorsements required by law, stock exchange rule or usage. Each Note shall be
dated the date of its authentication. The Notes shall be in denominations of
[$1,000] and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Agreement and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Agreement,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Agreement, the provisions of this Agreement shall govern and be
controlling.
(b) Global Notes. Notes issued in global form shall be
substantially in the form of Exhibit A attached hereto (including the Global
Note Legend thereon and the "Schedule of Exchanges of Interests in the Global
Note" attached thereto). Notes issued in definitive form shall be substantially
in the form of Exhibit A attached hereto (but without the Global Note Legend
thereon and without the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Each Global Note shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that it shall
represent the aggregate principal amount of outstanding Notes from time to time
endorsed thereon and that the aggregate principal amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Depositary Custodian, at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section
2.06 hereof.
2.02 Execution and Authentication.
An authorized Officer shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Agreement.
The Trustee shall authenticate Notes upon a written order of the
Company in the form of an Officer's Certificate of the Company (an
"Authentication Order"). Each such written order shall specify the amount of
Notes to be authenticated and the date on which the Notes are to be
authenticated, and whether the Notes are to be issued as certificated Notes or
Global Notes or such other information as the Trustee may reasonably request. In
addition, the first such written order from the Company shall be accompanied by
an Opinion of Counsel.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Agreement to
authentication by the Trustee includes authentication
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by such agent. An authenticating agent has the same rights as an Agent to deal
with Holders or the Company.
2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent")
within the City and State of New York. The Registrar shall keep a register of
the Notes and of their transfer and exchange. The Company may appoint one or
more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company shall notify the Trustee in writing of
the name and address of any Agent not a party to this Agreement. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act as
Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Depositary Custodian with respect to the Global
Notes.
2.04 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and will notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no further
liability for the money. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
2.05 Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA Section 312(a).
2.06 Transfer and Exchange.
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(a) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes only if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary or (ii) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Definitive Notes and delivers a written notice to such effect to the
Trustee. Upon the occurrence of either of the preceding events in (i) or (ii)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a). However, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b) or (c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Agreement and the Applicable Procedures. Transfers of beneficial interests
in the Global Notes also shall require compliance with either subparagraph (i)
or (ii) below, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest
in a Global Note. No written orders or instructions shall be required
to be delivered to the Registrar to effect the transfers described in
this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
2.06(b)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
credit or cause to be credited a beneficial interest in another Global
Note in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to
be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information
regarding the Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange referred to in (1) above.
Upon satisfaction of all of the
33
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Agreement and the Notes the Trustee shall
adjust the principal amount of the relevant Global Note(s) pursuant to
Section 2.06(g) hereof.
(c) Transfer or Exchange of Beneficial Interests in Global Notes
for Definitive Notes. If any holder of a beneficial interest in a Global Note
proposes to exchange such beneficial interest for a Definitive Note or to
transfer such beneficial interest to a Person who takes delivery thereof in the
form of a Definitive Note, then, upon satisfaction of the conditions set forth
in Section 2.06(b)(ii) hereof, the Trustee shall cause the aggregate principal
amount of the applicable Global Note to be reduced accordingly pursuant to
Section 2.06(g) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note issued
in exchange for a beneficial interest pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests in Global Notes. A Holder of a Definitive Note may exchange such Note
for a beneficial interest in a Global Note or transfer such Definitive Note to a
Person who takes delivery thereof in the form of a beneficial interest in a
Global Note at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Definitive Note and increase
or cause to be increased the aggregate principal amount of one of the Global
Notes.
If any such exchange or transfer from a Definitive Note to a beneficial
interest is effected at a time when a Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more Global
Notes in an aggregate principal amount equal to the principal amount of
Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing.
(f) Legends. The following legend shall appear on the face of all
Global Notes issued under this Agreement:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE OR CUSTODIAN,
AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO
34
SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a)
OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO
THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY."
(g) Cancellation and/or Adjustment of Global Notes. At such time
as all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges,
the Company shall execute and the Trustee shall authenticate Global
Notes and Definitive Notes upon the Company's order or at the
Registrar's request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than
any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 4.15 and 9.05
hereof).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Agreement, as
the Global Notes or Definitive Notes surrendered upon such registration
of transfer or exchange.
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(v) The Trustee shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 hereof and ending
at the close of business on the day of selection or (B) to register the
transfer of or to exchange any Note so selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed in
part.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes, and
none of the Trustee, any Agent or the Company shall be affected by
notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02
hereof.
(viii) All certifications, certificates and opinions of
counsel required to be submitted to the Registrar pursuant to this
Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
(ix) Each Holder agrees to indemnify the Company and the
Trustee against any liability that may result from the transfer,
exchange or assignment by such Holder of such Holder's Note in
violation of any provision of this Agreement and/or applicable United
States federal or state securities law.
(x) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Agreement or under applicable law with
respect to any transfer of any interest in any Note (including any
transfers between or among Participants and/or Indirect 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 Agreement, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof. The Trustee shall have no liability for the
actions or omissions of the Depositary.
2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. An indemnity bond must be supplied by the Holder that is
sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. The Company may charge for its
expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Agreement equally and
proportionately with all other Notes duly issued hereunder.
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2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes as to which a Responsible Officer of the Trustee has actual knowledge
are so owned shall be so disregarded.
2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Agreement.
2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall
37
dispose of canceled Notes in accordance with its procedures for the disposition
of canceled securities in effect as of the date of such disposition (subject to
the record retention requirement of the Exchange Act). Certification of the
disposition of all canceled Notes shall be delivered to the Company. The Company
may not issue new Notes to replace Notes that it has paid or that have been
delivered to the Trustee for cancellation.
2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date; provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
2.13 CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP", "ISIN" or similar
numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders; provided, however,
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP", "ISIN" or similar
numbers.
ARTICLE III
REDEMPTION AND PREPAYMENT
3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 30 days (or such shorter period acceptable to the Trustee) but not more
than 60 days before a redemption date, an Officer's Certificate setting forth
(i) the clause of this Agreement pursuant to which the redemption shall occur,
(ii) the redemption date, (iii) the principal amount of Notes to be redeemed and
(iv) the redemption price.
3.02 Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be redeemed
or purchased among the Holders of the
38
Notes in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed or, if the Notes are not so
listed, on a pro rata basis, by lot or in accordance with any other method the
Trustee considers fair and appropriate. In the event of partial redemption by
lot, the particular Notes to be redeemed shall be selected, unless otherwise
provided herein, not less than 30 nor more than 60 days prior to the redemption
date by the Trustee from the outstanding Notes not previously called for
redemption. Further, in the event of a partial redemption in accordance with
Section 3.07 or 3.08 hereof, selection of the Notes or portions thereof for
redemption shall be made by the Trustee only on a pro rata basis or on as nearly
a pro rata basis as is practicable (subject to the procedures of DTC), unless
such method is otherwise prohibited.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of [$1,000] or whole multiples of [$1,000];
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
[$1,000], shall be redeemed. Except as provided in the preceding sentence,
provisions of this Agreement that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
3.03 Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its address set
forth in the register.
The notice shall identify the Notes (including the CUSIP, ISIN or
similar numbers, if any) to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this Agreement
pursuant to which the Notes called for redemption are being redeemed; and
39
(h) that no representation is made as to the correctness or
accuracy of the CUSIP, ISIN or similar number, if any, listed in such notice or
printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided that the Company
shall have delivered to the Trustee, at least 15 days prior to the date of the
mailing of such notice, an Officer's Certificate requesting that the Trustee
give such notice and setting forth the information to be stated in such notice
as provided in this Section 3.03.
3.04 Effect of Notice of Redemption.
Once a notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
3.05 Deposit of Redemption Price.
On or prior to the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price of
and accrued interest on all Notes to be redeemed on that date. The Trustee or
the Paying Agent shall promptly return to the Company any money deposited with
the Trustee or the Paying Agent by the Company in excess of the amounts
necessary to pay the redemption price of, and accrued interest on, all Notes to
be redeemed.
If the Company complies with the provisions of the preceding paragraph,
on and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not paid on
such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.
3.06 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
3.07 Optional Redemption.
(a) At any time after the Issue Date, the Company shall have the
option to redeem the Notes, in whole or in part, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon to the applicable redemption date, if redeemed during
the 12-month period beginning on ______ of the years indicated below:
40
Calendar Year Percentage
------------- ----------
2004 102.0%
2005 101.5%
2006 101.0%
2007 and thereafter 100.0%
(b) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof.
3.08 Mandatory Redemption.
(a) Notwithstanding anything in Section 4.10 hereof to the
contrary, (i) the Net Available Proceeds of some or all of the Collateral
resulting from one or more Asset Sales and (ii) an amount equal to 75% of any
Net PWC Litigation Recovery in excess of $50.0 million in the aggregate shall be
used by the Company to redeem Notes, in whole or in part, at the redemption
price of 100% of the principal amount of the Notes so redeemed plus accrued and
unpaid interest thereon to the applicable redemption date. No redemption
pursuant to this Section 3.08 must be made until such time as the aggregate
amount of Net Available Proceeds and Net PWC Litigation Recovery proceeds
received by the Company and then available for such purpose equal or exceed
$____________ million.
(b) Any redemption pursuant to this Section 3.08 shall be made
within 90 days of the receipt by the Company of Net Available Proceeds or Net
PWC Litigation Recovery requiring such redemption, and shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof. Upon receipt by the Company
of such Net Available Proceeds or Net PWC Litigation Recovery, the same shall be
Collateral pursuant to the Security Agreement and shall be held by and under the
exclusive control of the Collateral Agent in a segregated Deposit Account or
investment account maintained at the Bank of New York in the name of the
Collateral Agent, as collateral agent (collectively, the "3.08(b) Account"), and
may be invested by the Collateral Agent in cash or Cash Equivalents and any
interest or investment gain thereon shall be added to, and considered a part of,
such Net Available Proceeds or Net PWC Litigation Recovery.
ARTICLE IV
COVENANTS
4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal of and interest
on the Notes on the dates and in the manner provided in the Notes. Principal and
interest shall be considered paid on the date due if the Paying Agent, if other
than the Company or a Subsidiary thereof, holds as of 12:00 noon Eastern Time on
the due date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal and interest then due.
The Company shall pay interest on overdue principal at the rate equal
to 2% per annum in excess of the then applicable interest rate on the Notes to
the extent lawful; it shall pay interest
41
on overdue installments of interest (without regard to any applicable grace
period) at the same rate to the extent lawful.
4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Agreement may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York for such purposes. The Company shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee
as one such office or agency of the Company in accordance with Section 2.03.
4.03 Reports.
(a) The Company shall furnish to the Trustee:
(i) within 120 days after the end of each fiscal year of
the Company, its audited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows as of the
end of and for such year, setting forth in each case in comparative
form the figures for the previous fiscal year, all reported on by its
independent public accountants of recognized national standing (without
a "going concern" or like qualification or exception and without any
qualification or exception as to the scope of such audit) to the effect
that such consolidated financial statements present fairly, in all
material respects, the consolidated financial condition and results of
operations of the Company and its Subsidiaries on a consolidated basis
in accordance with GAAP consistently applied;
(ii) within 60 days after the end of each of the first
three fiscal quarters of each fiscal year of the Company, its unaudited
consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows as of the end of and for such
fiscal quarter and the then elapsed portion of the fiscal year, setting
forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance
sheet, as of the end of) the previous fiscal year, all certified by one
of its financial officers as presenting fairly in all material respects
the consolidated financial
42
condition and results of operations of the Company and its Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied,
subject to normal year-end audit adjustments and the absence of
footnotes;
(iii) copies of the Company's annual report and the
information, documents and other reports that are specified in Section
13 and 15(d) of the Exchange Act (collectively, the "Required
Information"), whether or not the Company is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, to be provided
within 15 days after the Company files them with the Commission (or
would be required to file with the Commission); provided, however, that
if any of the Required Information is filed with the Commission, the
Company shall only be required to provide the Trustee copies of such
Required Information. Whether or not required by the rules and
regulations of the Commission, the Company will file a copy of such
information and reports with the Commission for public availability
within the time periods set forth in the Commission's rules and
regulations (unless the Commission will not accept such a filing).
(b) The Company shall also provide such information as may, from
time to time, be necessary to comply with any applicable provisions of
TIA Section 314(a).
(c) Delivery of such financial statements, reports, information
and documents to the Trustee pursuant to this Section 4.03 is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officer's Certificates).
4.04 Compliance Certificate.
(a) The Company, and to the extent required under the TIA, each
Guarantor, shall deliver to the Trustee, within 130 days after the end of each
fiscal year, an Officer's Certificate stating that a review of the activities of
the Company and each such Guarantor during the preceding fiscal year has been
made under the supervision of the signing Officers with a view to determining
whether the Company and each such Guarantor has kept, observed, performed and
fulfilled its obligations under this Agreement, and further stating, as to each
such Officer signing such certificate, that to the best of his or her knowledge
the Company and each such Guarantor has complied with all conditions and
covenants under this Agreement and is not in default in the performance or
observance of any of the terms, provisions and conditions of this Agreement (or,
if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's
43
independent public accountants that in making the examination necessary for
certification of such financial statements, nothing has come to their attention
that would lead them to believe that the Company or any of its Subsidiaries has
violated any provisions of Article IV or Article V hereof or, if any such
violation has occurred, specifying the nature and period of existence thereof,
it being understood that such accountants shall not be liable directly or
indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, as soon as possible, and in any event
within five days after any Officer becomes aware of any Default or Event of
Default, an Officer's Certificate specifying such Default or Event of Default
and what action the Company is taking or proposes to take with respect thereto.
4.05 Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings
promptly instituted and diligently conducted or where the failure to effect such
payment is not adverse in any material respect to the Holders of the Notes.
4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors covenants (to the extent that it
may lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Agreement; and the Company and
each of the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.
4.07 Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, make any Restricted Payment if at the
time of such Restricted Payment:
(i) a Default shall have occurred and be continuing or
shall occur as a consequence thereof;
(ii) the Company cannot incur $1.00 of additional
Indebtedness pursuant to the Coverage Ratio Exception at the time of
making such Restricted Payment and after giving pro forma effect
thereto as if such Restricted Payment was made at the beginning of the
applicable four-quarter period; or
(iii) 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
44
Payments made pursuant to clause (iii)(B), (iv), (v) or (vi) of Section
4.07(b) below), exceeds the sum (the "Restricted Payments Basket") of
(without duplication):
(A) 50% of Consolidated Net Income Available For
Common Stock 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 financial statements
are available (or, if such Consolidated Net Income Available
For Common Stock shall be a deficit, minus 100% of such
aggregate deficit), plus
(B) 100% of the aggregate net cash proceeds
received by the Company either (x) as contributions to the
common equity of the Company after the Issue Date or (y) from
the issuance and sale of Qualified Equity Interests after the
Issue Date, other than any such proceeds which are used to
redeem Notes in accordance with Section 3.07 hereof, plus
(C) the aggregate amount by which Indebtedness
(other than any Subordinated Indebtedness) incurred by the
Company or any Restricted Subsidiary subsequent to the Issue
Date is reduced on the Company's balance sheet upon the
conversion or exchange (other than by a Subsidiary of the
Company) into Qualified Equity Interests (less the amount of
any cash, or the Fair Market Value of assets, distributed by
the Company or any Restricted Subsidiary upon such conversion
or exchange), plus
(D) in the case of the disposition or repayment
in cash of or cash return on any Investment that was treated
as a Restricted Payment made after the Issue Date, an amount
(to the extent not included in the computation of Consolidated
Net Income) equal to the lesser of (1) the cash return of
capital with respect to such Investment and (2) 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 (1) the
Fair Market Value of the Company's proportionate interest in
such Subsidiary immediately following such Redesignation, and
(2) the aggregate amount of the Company's Investments in such
Subsidiary to the extent such Investments previously reduced
the Restricted Payments Basket and were not previously repaid
or otherwise reduced.
(b) The foregoing provisions will not prohibit: (i) the payment by
the Company or any Restricted Subsidiary of any dividend 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 Agreement; (ii) the redemption of any
Equity Interests of the Company or any Restricted Subsidiary in exchange for, or
out of the proceeds of the substantially concurrent issuance and sale of,
Qualified Equity Interests; (iii) the redemption of Subordinated Indebtedness of
the Company or any Restricted Subsidiary (A) in exchange for, or out of the
proceeds of the
45
substantially concurrent issuance and sale of Qualified Equity Interests or (B)
in exchange for, or out of the proceeds of the substantially concurrent
incurrence of, Refinancing Indebtedness permitted to be incurred under Section
4.09 hereof and other terms of this Agreement; (iv) repurchases of Equity
Interests deemed to occur upon the exercise of stock options if the Equity
Interests represent a portion of the exercise price thereof; (v) the issuance or
grant of shares, equity interests, options or warrants, stock appreciation
rights or units, or other similar payments issued or granted pursuant to
employee incentive plans approved by the Board of Directors, including a
majority of the Independent Directors, of the Company; (vi) the payment by the
Company of dividends on its Capital Stock accruing after the Issue Date, in an
aggregate amount not to exceed $13 million in any fiscal year; (vii) the payment
by the Company of dividends on its Capital Stock accrued for periods prior to
the Issue Date, so long as (A) the aggregate amount of such dividends in arrears
shall not exceed (1) $19.6 million paid in the aggregate after the Issue Date or
(2) the ECF Carry Forward Amount, if any, then in existence; provided, however,
that in the case of any Restricted Payment pursuant to clause (i), (iii), (vi)
or (vii) above, no Default shall have occurred and be continuing or occur as a
consequence thereof.
Notwithstanding anything to the contrary in the Indenture, on and after
the Issue Date, the Company will not, and the Company will not permit any
Subsidiary to, in one or a series of related transactions, directly or
indirectly, (1) make any Investment in SAC Holding or a Person in which one or
more Designated Persons beneficially own in the aggregate more than 1% of the
Equity Interests of such Person, other than Exempted Designated Person
Transactions (provided that this clause (1) shall not prevent Investments by the
Company in any of its Subsidiaries or by any of its Subsidiaries in any of the
other Subsidiaries of the Company in accordance with the provisions of the
Indenture), or (2) forgive or waive the repayment or retirement or amend the
terms of any Investment in existence on, or after (in the case of an Exempted
Designated Person Transaction), the Issue Date in SAC Holding or any such Person
made by the Company or any Subsidiary that is required to be repaid or retired
by the terms of such Investment as in effect on, or after (in the case of any
Exempted Designated Person Transaction), the Issue Date (other than in
accordance with the terms thereof as in effect on the date the Investment is
made).
The amount of all Restricted Payments shall be the Fair Market Value on
the date of the Restricted Payment of the asset(s) or securities proposed to be
transferred or issued by the Company or such Restricted Subsidiary, as the case
may be, pursuant to the Restricted Payment.
4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create or otherwise cause or permit to exist or
become effective any consensual encumbrance or 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 Company or any other Restricted
Subsidiary; or (c) transfer any of its assets to the Company or any other
Restricted Subsidiary; except for:
(i) encumbrances or restrictions existing under or by
reason of applicable law;
46
(ii) encumbrances or restrictions existing under this
Agreement, the Notes and the Note Guarantees;
(iii) customary non-assignment provisions of any contract
or any lease entered into in the ordinary course of business;
(iv) encumbrances or restrictions existing under
agreements existing on the date of this Agreement (including, without
limitation, the New Credit Agreement) as in effect on that date;
(v) restrictions on the transfer of assets subject to any
Lien permitted under this Agreement imposed by the holder of such Lien;
(vi) restrictions on the transfer of assets imposed under
any agreement to sell such assets permitted under this Agreement to any
Person pending the closing of such sale;
(vii) any instrument governing Acquired Indebtedness, the
incurrence of which was permitted under this Agreement, 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;
(viii) 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;
(ix) customary provisions in partnership agreements,
limited liability company organizational governance documents, Joint
Venture agreements and other similar agreements entered into in the
ordinary course of business that restrict the transfer of ownership
interests in such partnership, limited liability company, Joint Venture
or similar Person;
(x) Non-Recourse Purchase Money Indebtedness incurred in
compliance with Section 4.09 hereof that imposes restrictions of the
nature described in clause (c) above on the assets acquired;
(xi) Indebtedness arising from the guarantee of the
Company or any Restricted Subsidiary of any Indebtedness of the
Company, the incurrence of which was permitted under this Agreement;
and
(xii) any encumbrances or restrictions imposed by any
amendments or refinancings of the contracts, instruments or obligations
referred to in clauses (i) through (x) above; provided, however, that
such amendments or refinancings are, in the good faith judgment of the
Company's Board of Directors, no more materially restrictive with
respect to such encumbrances and restrictions than those prior to such
amendment or refinancing.
47
4.09 Limitation on Additional Indebtedness.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, incur any Indebtedness (including
Acquired Indebtedness); provided, however, that the Company or any Guarantor may
incur additional Indebtedness (including Acquired Indebtedness) if, after giving
effect thereto on the date of incurrence of such additional indebtedness, the
Consolidated Interest Coverage Ratio would be at least 2.00 to 1.00 (the
"Coverage Ratio Exception").
(b) Notwithstanding clause (a) above, each of the following shall
be permitted ("Permitted Indebtedness"):
(i) Indebtedness of the Company and any Guarantor
incurred under the New Credit Agreement in an aggregate amount at any
time outstanding not to exceed $575.0 million, less mandatory permanent
prepayments and permanent reductions made pursuant to Section 4.10
plus: (A) advances made pursuant to the New Credit Agreement to pay
expenses of the lenders thereunder (including expenses accruing after
the commencement of any Insolvency or Liquidation Proceeding (as
defined in the New Credit Agreement), whether or not a claim for
post-filing or post-petition expenses is allowed in such proceeding),
(B) advances made to protect or preserve the "Collateral" under the New
Credit Agreement, (C) advances made to pay interest (including interest
accruing under Section 2.6(c) of the New Credit Agreement and interest
accruing after the commencement of any Insolvency or Liquidation
Proceeding (as defined in the New Credit Agreement), whether or not a
claim for post-filing or post-petition interest is allowed in such
proceeding) and (D) advances made pursuant to the New Credit Agreement
to pay fees under the New Credit Agreement (including fees accruing
after the commencement of any Insolvency or Liquidation Proceeding (as
defined in the New Credit Agreement), whether or not a claim for
post-filing or post-petition fees are allowed in such proceeding);
(ii) the Notes issued on the Issue Date and the Note
Guarantees;
(iii) Indebtedness of the Company and the Restricted
Subsidiaries to the extent outstanding on the Issue Date, including,
without limitation, Indebtedness of the Company under the Term Loan B
Notes;
(iv) (A) Purchase Money Indebtedness and Capitalized Lease
Obligations (other than Capitalized Leases of the type set forth in
clause (B) of this Section 4.09(b)(iv)) incurred after the Issue Date
in an aggregate amount not to exceed $40,000,000, and (B) Capitalized
Leases, to the extent such Capitalized Leases arise out of the
treatment of any of the Synthetic Leases (including any refinancings,
in whole or in part, thereof) as Capitalized Leases in accordance with
the requirements of GAAP or are entered into for the purpose of
acquiring Vehicles for use in the operations of the business of the
Company and the Guarantors in the ordinary course;
(v) Indebtedness under Hedging Obligations entered into
in the ordinary course of business for bona fide hedging purposes and
not for the purpose of speculation;
48
provided, however, that with respect to Hedging Obligations related to
interest rates (A) such Hedging Obligations relate to payment
obligations on Indebtedness otherwise permitted to be incurred by this
Agreement, 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;
(vi) Indebtedness of the Company owed to a Wholly-Owned
Restricted Subsidiary and Indebtedness of any Guarantor owed to the
Company or any Wholly-Owned Restricted Subsidiary; provided, however,
that (A) with respect to Indebtedness of the Company, such Indebtedness
shall be unsecured and contractually subordinated to the Company's
obligations under the Notes; and (B) upon any such Wholly-Owned
Restricted Subsidiary ceasing to be a Wholly-Owned Restricted
Subsidiary or such Indebtedness being owed to any Person other than the
Company or a Guarantor, the Company or such Guarantor, as applicable,
shall be deemed to have incurred Indebtedness not permitted by this
clause (vi);
(vii) Indebtedness in respect of bid, performance or surety
bonds issued for the account of the Company or any Guarantor in the
ordinary course of business, including guarantees or obligations of the
Company or any Guarantor with respect to letters of credit supporting
such bid, performance or surety obligations (in each case other than
for an obligation for money borrowed);
(viii) Indebtedness with respect to letters of credit issued
by a party other than ▇▇▇▇▇ Fargo Foothill, Inc. and secured by cash
collateral in an aggregate amount not to exceed $3,000,000 at any time;
(ix) Indebtedness arising in connection with endorsement
of instruments for deposit in the ordinary course of business;
(x) Refinancing Indebtedness with respect to Indebtedness
incurred pursuant to the Coverage Ratio Exception, clauses (i), (ii),
(iii) or (iv) above or this clause (x);
(xi) Indebtedness arising from Investments in PM Preferred
or any of its Affiliates owned by the Company or any of its
Subsidiaries or SAC Holding under the Support Party Agreement;
(xii) Indebtedness arising from the guarantee by the
Company or any Guarantor of any Indebtedness of the Company or a
Guarantor permitted to be incurred pursuant to this Agreement; and
(xiii) Indebtedness, in addition to Indebtedness incurred
pursuant to the foregoing clauses of this definition, with an aggregate
principal face or stated amount (as applicable) at any time outstanding
for all such Indebtedness incurred pursuant to this clause not in
excess of $7.5 million.
(c) For purposes of determining compliance with this Section 4.09,
in the event that an item of Indebtedness meets the criteria of more than one of
the categories of Permitted Indebtedness described in clauses (i) through (xiii)
above or is entitled to be incurred pursuant to
49
the Coverage Ratio Exception, the Company shall, in its sole discretion,
classify such item of Indebtedness and may divide and classify such Indebtedness
in more than one of the types of Indebtedness described, except that
Indebtedness incurred under the New Credit Agreement on the Issue Date shall be
deemed to have been incurred under clause (i) above. Accrual of interest,
accretion or amortization of original issue discount or the payment of interest
on any Indebtedness in the form of additional Indebtedness with the same terms
will not be deemed to be an incurrence of Indebtedness for purposes of this
covenant; provided, however, in each such case, that the amount thereof is
included in fixed charges of the Company as accrued.
4.10 Asset Sales.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, consummate any Asset Sale unless (i) no
Default exists or is continuing immediately prior to and after giving effect to
the Asset Sale, and (ii) the Company or such Restricted Subsidiary receives (A)
consideration at the time of such Asset Sale at least equal to the Fair Market
Value of the assets included in such Asset Sale, except that in the case of an
Asset Sale of any Sale Property or Surplus Property, the Company or such
Restricted Subsidiary must receive consideration at least equal to 80% of the
Appraised Value of the assets in such Asset Sale, (B) in the case of a lease of
assets that constitutes an Asset Sale, a lease providing for rents or other
consideration which are no less favorable to the Company or the Restricted
Subsidiary than the prevailing market conditions as determined in good faith by
a majority of the members of the Board of Directors and (C) in the case of an
Asset Sale of Collateral (other than Oxford Stock), at least 75% of the proceeds
from such Asset Sale in the form of cash or Cash Equivalents. If at any time any
non-cash consideration received by the Company or any Restricted Subsidiary of
the Company, 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, except as provided in Section 3.08, the Net
Available Proceeds thereof shall be applied in accordance with this Section
4.10. If such Asset Sale is a sale of Collateral, then the Net Available
Proceeds shall be applied in accordance with Section 3.08. If the Company or any
Restricted Subsidiary engages in an Asset Sale in respect of any asset that is
not Collateral or the proceeds or profits therefrom, except as provided in
Section 3.08, the Company or such Restricted Subsidiary shall, no later than 360
days following the consummation thereof, apply all or any of the Net Available
Proceeds therefrom to: (1) make payments under the New Credit Agreement or
redeem any other Senior Indebtedness; provided, however, that such payments or
redemption result in a permanent reduction in commitments thereunder; (2) repay
any Indebtedness which was secured by the assets sold in such Asset Sale; and/or
(3) invest all or any part of the Net Available Proceeds thereof in the purchase
of assets to be used by the Company or any Restricted Subsidiary in the
Permitted Business or the purchase of an entity engaged in a Permitted Business
that becomes a Restricted Subsidiary.
(b) The amount of Net Available Proceeds not applied or invested
as provided in Section 3.08 or Section 4.10(a) will constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds equals or exceeds $10.0
million, the Company shall be required to make an offer to purchase Notes from
all Holders and, if applicable, redeem (or make an offer to do so) any Pari
Passu Indebtedness of the Company the incurrence of which was permitted under
this
50
Agreement and the provisions of which require the Company to redeem such
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:
(i) the Company shall (A) make an offer to purchase Notes
(a "Net Proceeds Offer") to all Holders in accordance with the
procedures set forth in this Agreement, and (B) redeem (or make an
offer to do so) any such other Pari Passu Indebtedness, 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;
(ii) the offer price for the Notes shall 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"), in accordance with the procedures
set forth in this Agreement 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;
(iii) if the aggregate (a) Offered Price of Notes validly
tendered and not withdrawn by Holders thereof and (b) principal amount
of Pari Passu Indebtedness required to be redeemed exceeds the Payment
Amount, Notes to be purchased and Pari Passu Indebtedness to be
redeemed will be selected on a pro rata basis; and
(iv) 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.
(c) 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 Company may use the Net Proceeds Deficiency, or a
portion thereof, for general corporate purposes or any other purpose permitted
under this Agreement.
The Company shall 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 Section 4.10 hereof, the Company shall comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under Section 4.10 hereof by virtue of such compliance.
(d) Notwithstanding anything to the contrary in the Indenture, on
and after the Issue Date, the Company will not, and will not permit any
Subsidiary to, in one or a series of related transactions, directly or
indirectly, (1) engage in any Asset Sale to SAC Holding or a Person in which one
or more Designated Persons beneficially own in the aggregate more than 1% of the
Equity Interests of such Person (provided that this clause (1) shall not prevent
transactions between or among the Company and any of its Subsidiaries in
accordance with the provisions of
51
the Indenture), or (2) engage in any transaction which involves the sale,
transfer, assignment or other disposition by SAC Holding or a Person in which
one or more Designated Persons beneficially own in the aggregate more than 1% of
the Equity Interests of such Person of property, rights or assets (including by
merger or consolidation in the case of a Subsidiary and including any sale or
other transfer or issuance of any Equity Interests of a Subsidiary) to the
Company or any Subsidiary, other than in each case Exempted Designated Person
Transactions.
4.11 Transactions with Affiliates and Designated Persons.
(a) The Company shall not, and shall 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"), or any series or related Affiliate
Transactions, other than Exempted Affiliate Transactions, unless:
(i) such Affiliate Transaction is on terms that are no
less favorable to the Company or the relevant Restricted Subsidiary
than those that would have been obtained in a comparable transaction at
such time on an arm's-length basis by the Company or that Restricted
Subsidiary from a Person that is not an Affiliate of the Company or
that Restricted Subsidiary; and
(ii) the Company delivers to the Trustee an Officer's
Certificate certifying that such Affiliate Transaction complies with
clause (i) above and a Secretary's Certificate which sets forth and
authenticates a resolution that has been adopted by the Independent
Directors approving such Affiliate Transaction.
(b) The foregoing restrictions shall not apply to: (i)
transactions exclusively between or among (A) the Company and one or more
Restricted Subsidiaries that are Guarantors or (B) a Restricted Subsidiary and
one or more Restricted Subsidiaries that are Guarantors; provided, however, in
each case, that no Affiliate of the Company (other than another Restricted
Subsidiary) owns Equity Interests of any such Restricted Subsidiary; (ii)
reasonable director, officer and employee compensation (including bonuses) and
other benefits (including retirement, health, stock option and other benefit
plans) and indemnification arrangements provided on behalf of such directors,
officers and employees; (iii) the entering into of a tax sharing agreement, or
payments pursuant thereto, between the Company and/or one or more Subsidiaries,
on the one hand, and any other Person with which the Company or such
Subsidiaries are required or permitted to file a consolidated tax return or with
which the Company or such Subsidiaries are part of a consolidated group for tax
purposes, on the other hand, which payments by the Company and the Restricted
Subsidiaries are not in excess of the tax liabilities that would have been
payable by them on a stand-alone basis; (iv) loans and advances to employees of
the Company and the Restricted Subsidiaries in respect of commissions, business
expenses, travel and relocation and other similar expenses in the ordinary
course of business; and (v) any transaction with an Affiliate where the only
consideration paid by the Company or any Restricted Subsidiary is Qualified
Equity Interests.
52
(c) Notwithstanding anything to the contrary in the Indenture, on
and after the Issue Date, the Company will not, and the Company will not permit
any Subsidiary to, sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
or make any contract, agreement, understanding, loan, advance or guarantee with,
or for the benefit of, SAC Holding (irrespective of whether SAC Holding is an
Affiliate of one or more Designated Persons) or any Affiliate of SAC Holdings or
any Person in which one or more Designated Persons beneficially own in the
aggregate more than 1% of the Equity Interests of such Person, other than
Exempted Designated Person Transactions (provided that this paragraph shall not
prevent transactions between or among the Company and any of its Subsidiaries in
accordance with the provisions of the Indenture).
4.12 Liens.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or permit or suffer to exist
(a) any Lien of any nature whatsoever against (other than Permitted Liens) any
Collateral; or (b) any Lien of any nature whatsoever (other than Permitted
Liens) against any other assets of the Company or any Restricted Subsidiary
(including Equity Interests of a Restricted Subsidiary), whether owned at the
Issue Date or thereafter acquired, or any proceeds therefrom, which Lien secures
Indebtedness, unless contemporaneously therewith: (i) 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 (ii) 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.
4.13 Business Activities.
The Company shall not, and shall not permit any Restricted Subsidiary
to, engage in any business other than a Permitted Business.
4.14 Corporate Existence.
(a) Subject to Article V hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or other existence of
each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Subsidiary and (ii) its rights (charter and statutory), licenses and
franchises and those of its Subsidiaries material to its and its Subsidiaries'
business; provided that the Company shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence of
any of its Subsidiaries if the Board of Directors of the Company shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
53
(b) The Company shall do or cause to be done all things necessary
to ensure that the Dormant Subsidiaries (a) shall remain inactive, (b) shall not
engage in any business activities (other than winding up or dissolution), (c)
shall not have assets with an aggregate fair market value in excess of $100,000,
and (d) shall not have any annual operating expenditures or other liabilities.
4.15 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of any Change of Control, each Holder will
have the right to require that the Company purchase that Holder's Notes for a
cash price (the "Change of Control Purchase Price") equal to 101% of the
principal amount of the Notes to be purchased, plus accrued and unpaid interest
thereon, if any, to the date of purchase. Within 30 days following any Change of
Control, the Company shall mail, or cause to be mailed, to the Holders a notice:
(i) describing the transaction or transactions that
constitute the Change of Control,
(ii) offering to purchase, pursuant to the procedures of
this Agreement and described in the notice (a "Change of Control
Offer"), on a date specified in the notice (which shall be a Business
Day not earlier than 30 days nor later than 60 days from the date the
notice is mailed) (the "Change of Control Payment Date") and for the
Change of Control Purchase Price, all Notes properly tendered by such
Holder pursuant to such Change of Control Offer; and
(iii) describing the procedures that Holders must follow to
accept the Change of Control Offer. The Change of Control Offer is
required to remain open for at least 20 Business Days or for such
longer period as is required by law.
The provisions of this Section 4.15 require the Company to make a
Change of Control Offer following a Change of Control and shall be applicable
regardless of whether any other provisions of this Agreement are applicable. The
Company may, at any time and from time to time, acquire Notes by means other
than a redemption, whether pursuant to an issuer tender offer, open market
purchase or otherwise, so long as the acquisition does not otherwise violate the
terms of this Article IV. The Company shall comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of Notes in connection with a Change of Control. To the
extent that the provisions of any securities laws or regulations conflict with
this Section 4.15, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
this Section 4.15 by virtue of such compliance.
(b) On the Change of Control Payment Date, the Company shall, to
the extent lawful, (A) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (B) deposit with the Paying
Agent an amount equal to the Change of Control Purchase Price in respect of all
Notes or portions thereof so tendered and (C) deliver or cause to be delivered
to the Trustee the Notes so accepted together with an Officer's Certificate
stating the aggregate principal amount of Notes or portions thereof being
purchased by the Company.
54
The Paying Agent shall promptly mail to each Holder of Notes so tendered payment
in an amount equal to the purchase price for the Notes, and the Trustee shall
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 by such Holder, if any; provided, however, that each such
new Note shall be in a principal amount of [$1,000] or an integral multiple
thereof. The Company shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date.
(c) Notwithstanding anything to the contrary in this Section 4.15,
the Company shall 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 Section 4.15 and all other provisions of this Agreement applicable to a
Change of Control Offer made by the Company and purchases all Notes validly
tendered and not withdrawn under such Change of Control Offer. In addition, the
Company shall not be required to make a Change of Control Offer, as provided
under this Section 4.15, if, in connection with or in contemplation of any
Change of Control, the Company has made an offer to purchase (an "Alternate
Offer") any and all Notes validly tendered at a cash price equal to or higher
than the Change of Control Purchase Price and has purchased all Notes properly
tendered in accordance with the terms of such Alternate Offer; provided,
however, that the terms and conditions of such contemplated Change of Control
are described in reasonable detail to the Holders in the notice delivered in
connection with such Change of Control Offer.
4.16 Designation of Unrestricted Subsidiaries.
(a) The Company may designate any Subsidiary of the Company as an
Unrestricted Subsidiary under this Agreement (a "Designation") only if:
(i) no Default shall have occurred and be continuing at
the time of or after giving effect to such Designation; and
(ii) the Company would be permitted to make, at the time
of such Designation, (A) a Permitted Investment pursuant to clause (20)
of the definition of Permitted Investment or (B) an Investment pursuant
to Section 4.07(a) hereof, in either case, in an amount (the
"Designation Amount") equal to the Fair Market Value of the Company's
proportionate interest in such Subsidiary on such date.
(b) No Subsidiary shall be Designated as an "Unrestricted
Subsidiary" unless such Subsidiary:
(i) has no Indebtedness other than Non-Recourse Debt;
(ii) is not party to any agreement, contract, arrangement
or understanding with the Company or any Restricted Subsidiary unless
the terms of the agreement, contract, arrangement or understanding are
no less favorable to the Company or the Restricted Subsidiary than
those that might be obtained at the time from Persons who are not
Affiliates;
55
(iii) is a Person with respect to which neither the Company
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
(iv) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company
or any Restricted Subsidiary, except for any guarantee given solely to
support the pledge by the Company or any Restricted Subsidiary of the
Equity Interests of such Unrestricted Subsidiary, which guarantee is
not recourse to the Company or any Restricted Subsidiary, and except to
the extent the amount thereof constitutes a Restricted Payment
permitted under Section 4.07 hereof.
(c) If, at any time, any Unrestricted Subsidiary fails to meet the
preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Agreement 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 4.09 hereof or the
Lien is not permitted under Section 4.12 hereof, the Company shall be in default
of the applicable covenant.
(d) The Company may redesignate an Unrestricted Subsidiary as a
Restricted Subsidiary (a "Redesignation") only if:
(i) no Default shall have occurred and be continuing at
the time of and after giving effect to such Redesignation; and
(ii) 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 Agreement.
All Designations and Redesignations must be evidenced by resolutions of
the Board of Directors of the Company, delivered to the Trustee
certifying compliance with the foregoing provisions.
4.17 Limitation on Issuance or Sale of Equity Interests of Restricted
Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, sell or issue any shares of Equity Interests of any
Restricted Subsidiary except (a) to the Company, a Restricted Subsidiary or the
minority stockholders of any Restricted Subsidiary, if any, on a pro rata basis,
at Fair Market Value, or (b) to the extent such shares represent directors'
qualifying shares or shares required by applicable law to be held by a Person
other than the Company or a Wholly-Owned Restricted Subsidiary. The sale of all
the Equity Interests of any Restricted Subsidiary is permitted by this Section
4.17 but is subject to Section 4.10 hereof.
4.18 Additional Note Guarantees.
(a) If, after the Issue Date, (i) the Company or any Restricted
Subsidiary shall acquire or create another Subsidiary (other than a Subsidiary
that has been designated an Unrestricted
56
Subsidiary) or (ii) any Unrestricted Subsidiary is redesignated a Restricted
Subsidiary, then, in each such case, the Company shall cause such Restricted
Subsidiary to: (A) execute and deliver to the Trustee a supplemental indenture
substantially in the form of Exhibit C hereto and (2) a notation of guarantee in
respect of its Note Guarantee substantially in the form of Exhibit B hereto; and
(B) deliver to the Trustee an Opinion of Counsel to the effect that each of such
supplemental indenture and notation of guarantee (1) has been duly authorized,
executed and delivered by such Restricted Subsidiary and (2) constitutes a valid
and legally binding obligation of such Restricted Subsidiary in accordance with
its terms.
4.19 Limitations on Sale and Leaseback Transactions.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, enter into any Sale and Leaseback Transaction; provided,
however, that the Company or any Restricted Subsidiary may enter into a Sale and
Leaseback Transaction if:
(a) the Company or such Restricted Subsidiary could have
(i) incurred the Indebtedness attributable to such Sale and Leaseback
Transaction pursuant to Section 4.09 hereof and (ii) incurred a Lien to
secure such Indebtedness without being required to equally and ratably
secure the Notes pursuant to Section 4.12 hereof;
(b) the gross cash proceeds of such Sale and Leaseback
Transaction are at least equal to the Fair Market Value of the asset
that is the subject of such Sale and Leaseback Transaction; and
(c) the transfer of assets in such Sale and Leaseback
Transaction is permitted by, and the Company or the applicable
Restricted Subsidiary applies the proceeds of such transaction in
accordance with Section 3.08 or Section 4.10 hereof, as applicable.
4.20 Payments for Consent.
The Company and the Guarantors shall not, and shall not permit any
Restricted 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 Agreement, the Notes or the Security Documents unless that consideration
is offered to be paid and is paid to all Holders of the Notes that consent,
waiver or agree to amend in the time frame described in the solicitation
documents relating to that consent, waiver or agreement, as applicable.
ARTICLE V
SUCCESSORS
5.01 Merger, Consolidation, or Sale of Assets.
The Company shall not, directly or indirectly, in a single transaction
or a series of related transactions, (a) consolidate or merge with or into
(other than a merger with a Wholly-Owned
57
Restricted Subsidiary solely for the purpose of changing the Company'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 Company or the Company and the Restricted Subsidiaries
(taken as a whole) or (b) adopt a Plan of Liquidation unless, in either case;
(i) either:
(1) the Company will be the surviving or
continuing Person; or
(2) 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
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, all of
the obligations of the Company under the Notes, this Agreement
and the Security Documents;
(ii) immediately prior to and immediately after giving
effect to such transaction and the assumption of the obligations as set
forth in clause (i)(2) above and the incurrence of any Indebtedness to
be incurred in connection therewith, no Default shall have occurred and
be continuing; and
(iii) immediately after and giving effect to such
transaction and the assumption of the obligations set forth in clause
(i)(2) 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, (1) the Consolidated Net Worth of the Company or the
Successor, as the case may be, would be at least equal to the
Consolidated Net Worth of the Company immediately prior to such
transaction and (2) the Company or the Successor, as the case may be,
could incur $1.00 of additional Indebtedness pursuant to the Coverage
Ratio Exception.
For purposes of this Section 5.01, any Indebtedness of the Successor
which was not Indebtedness of the Company immediately prior to the transaction
shall be deemed to have been incurred in connection with such transaction.
Except as provided in Sections 10.04 and 10.05 hereof, no Guarantor may
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, whether or not affiliated with such Guarantor.
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 Company, shall be deemed to be the transfer
of all or substantially all of the properties and assets of the Company.
Notwithstanding the foregoing, any Restricted Subsidiary may merge into
the Company or a Wholly-Owned Restricted Subsidiary.
58
5.02 Successor Corporation Substituted.
Upon any consolidation or merger of the Company or a Guarantor, or any
conveyance, lease or transfer of all or substantially all of the assets of the
Company in accordance with Section 5.01 hereof, in which the Company or such
Guarantor is not the continuing obligor under the Notes or its Note Guarantee,
the surviving entity formed by such consolidation or into which the Company 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 Company or such Guarantor under this Agreement, the Notes, the Note
Guarantees and the Security Documents with the same effect as if such surviving
entity had been named therein as the Company or such Guarantor and, except in
the case of a conveyance, transfer or lease, the Company 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 Company's or such Guarantor's other obligations and covenants
under the Notes, this Agreement, its Note Guarantee and the Security Documents,
if applicable; provided, however, that the surviving entity shall have assumed
all of the obligations of the acquired Person incurred under this Agreement, the
Notes, the Note Guarantees and the Security Documents as provided in Section
5.01.
ARTICLE VI
DEFAULTS AND REMEDIES
6.01 Events of Default.
Each of the following is an "Event of Default":
(a) failure by the Company to pay interest on any of the
Notes when it becomes due and payable and the continuance of any such
failure for 30 days;
(b) failure by the Company to pay the principal of any of
the Notes when it becomes due and payable, whether at stated maturity,
upon redemption, upon purchase, upon acceleration or otherwise;
(c) failure by the Company to comply with any of its
agreements or covenants described under Sections 3.08, 4.07, 4.09,
4.10, 4.15 and 5.01 hereof;
(d) failure by the Company to comply with any other
agreement or covenant in this Agreement or the Security Documents and
continuance of this failure for 30 days after notice of the failure has
been given to the Company by the Trustee or by the Holders of at least
25% of the aggregate principal amount of the Notes then outstanding;
(e) 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 Company or any
Restricted Subsidiary, whether such Indebtedness now exists or is
incurred after the Issue Date, which default:
59
(i) is caused by a failure to pay when due principal on
such Indebtedness within the applicable express grace period,
(ii) results in the acceleration of such Indebtedness
prior to its express final maturity or
(iii) 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 (i), (ii) or (iii) has occurred and is continuing, aggregates
$10 million or more;
(f) one or more judgments or orders that exceed $10
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 Company or any Restricted
Subsidiary and such judgment or judgments have not been satisfied,
stayed, annulled or rescinded within 60 days of being entered;
(g) the Company or any Significant Subsidiary pursuant to
or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against
it in an involuntary case,
(iii) consents to the appointment of a Custodian of it or
for all or substantially all of its assets,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become due;
(h) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company or any Significant
Subsidiary as debtor in an involuntary case,
(ii) appoints a Custodian of the Company or any
Significant Subsidiary or a Custodian for all or substantially all of
the assets of the Company or any Significant Subsidiary, or
(iii) orders the liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
days;
60
(i) 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 Agreement) or is declared
null and void and unenforceable or found 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 Agreement and the Note Guarantee); or
(j) an "Event of Default" occurs and is continuing under
any of the Security Documents or the Company or any Guarantor
repudiates any of its obligations under any of the Security Documents,
or any of the Security Documents become unenforceable against any of
them for any reason which continues for 30 days after written notice
from the Trustee or holders of at least 25% in outstanding principal
amount of Notes or the loss of the perfection or priority of the Liens
granted by any of them pursuant to the Security Documents occurs for
any reason.
6.02 Acceleration.
(a) If an Event of Default (other than an Event of Default
specified in clause (g) or (h) of Section 6.01 hereof with respect to the
Company) shall have occurred and be continuing, the Trustee, by written notice
to the Company, or the Holders of at least 25% in aggregate principal amount of
the Notes then outstanding, by written notice to the Company and the Trustee,
may declare all amounts owing under the Notes to be due and payable immediately.
Upon such declaration of acceleration, the aggregate principal of and accrued
and unpaid interest on the outstanding Notes shall immediately become due and
payable; 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 if all Events of Default, other than the nonpayment of accelerated
principal and interest, have been cured or waived as provided in this Agreement.
If an Event of Default specified in clause (g) or (h) of Section 6.01 hereof
occurs with respect to the Company, all outstanding Notes shall become due and
be immediately payable without any further action or notice.
(b) If an Event of Default occurs by reason of any willful action
(or inaction) taken (or not taken) by or on behalf of the Company with the
intention of avoiding payment of the premium that the Company would have had to
pay if the Company then had elected to redeem the Notes pursuant to Section 3.07
hereof, then, upon acceleration of the Notes, an equivalent premium shall also
become and be immediately due and payable, to the extent permitted by law,
anything in this Agreement or in the Notes to the contrary notwithstanding.
6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium and interest
on the Notes or to enforce the performance of any provision of the Notes or this
Agreement.
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
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Holder of a Note in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. All remedies are cumulative to the extent
permitted by law.
6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, or premium or interest on, the Notes (including in
connection with an offer to purchase) (provided that the Holders of a majority
in aggregate principal amount of the then outstanding Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration). Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Agreement; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
6.05 Control by Majority.
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Agreement that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
6.06 Limitation on Suits.
A Holder of a Note may institute a proceeding with respect to this
Agreement or for any remedy hereunder only if:
(a) the Holder of a Note gives to the Trustee written
notice of a continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal
amount of the then outstanding Notes make a written request to the
Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and,
if requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within
60 days after receipt of the request; and
(e) during such 60-day period the Holders of a majority
in principal amount of the then outstanding Notes do not give the
Trustee a direction inconsistent with the request.
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A Holder of a Note may not use this Agreement to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
However, the limitations set forth in this Section 6.06 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 Section 6.01(a) hereof).
6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Agreement, the right of any
Holder of a Note to receive payment of principal, premium and interest on the
Note on or after the respective due dates expressed in the Note (including in
connection with an offer to purchase), or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder.
6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company and the Guarantors for the
whole amount of principal of, premium and interest remaining unpaid on the Notes
and interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
6.09 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
or the Guarantors (or any other obligor upon the Notes), its creditors or its
property and shall be entitled and empowered to collect, receive and distribute
any money or other property payable or deliverable on any such claims and any
Custodian in any such judicial proceeding is hereby authorized by each Holder to
make such payments to the Trustee, and in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 hereof. To the extent that the
payment of any such compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof out of the estate in any such proceeding, shall be denied
for any reason, payment of the same shall be secured by a Lien on, and shall be
paid out of, any and all distributions, dividends, money, securities and other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise. Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any
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plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
6.10 Priorities.
Any money or other property collected by the Trustee pursuant to this
Article VI shall be paid in the following order:
First: to the Trustee (including and predecessor Trustee),
its agents and attorneys for amounts due under Section 7.07 hereof,
including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium and interest, ratably, without preference
or priority of any kind, according to the amounts due and payable on
the Notes for principal, premium and interest, respectively; and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Agreement or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee or a suit by a Holder
of a Note pursuant to Section 6.07 hereof.
6.12 Actions of a Holder.
For the purpose of providing any consent, waiver or instruction to the
Company or the Trustee, a "Holder" or "Noteholder" shall include a Person who
provides to the Company or the Trustee, as the case may be, an affidavit of
beneficial ownership of a Note together with a satisfactory indemnity against
any loss, liability or expense to such party to the extent that it acts upon
such affidavit of beneficial ownership (including any consent, waiver or
instructions given by a Person providing such affidavit and indemnity).
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ARTICLE VII
TRUSTEE
7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, 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
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely
by the express provisions of this Agreement and the Trustee need
perform only those duties that are specifically set forth in this
Agreement and no others, and no implied covenants or obligations shall
be read into this Agreement against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Agreement; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Agreement, but need not confirm or investigate
the accuracy of mathematical calculations or other facts stated
therein.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph (c) does not limit the effect of
paragraphs (b) or (d) of this Section 7.01;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
(d) No provision of this Agreement shall require the Trustee to
expend or risk its own funds or incur any or risk liability. The Trustee shall
be under no obligation to exercise any of its rights and powers under this
Agreement at the request of any Holders, unless such Holder shall have offered
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense.
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(e) Whether or not therein expressly so provided, every provision
of this Agreement that in any way relates to the Trustee is subject to Sections
7.01(a), (b), (c) and (d).
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed
by it to be genuine and to have been signed or presented by the proper Person.
The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes, suffers or omits to take in good
faith in reliance on such Officer's Certificate or Opinion of Counsel. The
Trustee may consult with counsel of its selection (which may include counsel to
the Company) and the advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through attorneys and agents and shall not
be responsible for the misconduct or negligence of any attorney or agent
appointed with due care.
(d) The Trustee shall not be liable for any action it taken,
suffered or omitted by it in good faith that it believes to be authorized or
within the rights or powers conferred upon it by this Agreement.
(e) Unless otherwise specifically provided in this Agreement, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement at the request or direction
of any of the Holders unless such Holders shall have offered to the Trustee
security or indemnity satisfactory to it against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
(g) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it sees fit, and, if the Trustee shall determine
to make such further inquiry or investigation, it shall be entitled to examine
the books, records and premises of the Company or the Guarantors, personally or
by agent or attorney, and shall incur no liability of any kind by reason of such
inquiry or investigation.
(h) The Trustee shall not be deemed to have notice of any Default
or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice
66
of any event which is in fact such a default is received by the Trustee at the
Corporate Trust Office of the Trustee, and such notice references the Notes and
this Agreement.
(i) 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 each Agent, Depositary Custodian and other
Person employed to act hereunder.
(j) The Trustee may request that the Company deliver an Officer's
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Agreement,
which Officer's Certificate may be signed by any Person authorized to sign an
Officer's Certificate, including any Person specified as so authorized in any
such certificate previously delivered and not superseded.
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 Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. The Trustee shall comply with Section 310(b) of the TIA. The Trustee is
also subject to Sections 7.10 and 7.11 hereof.
7.04 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Agreement, the Notes or the Note Guarantees,
it shall not be accountable for the Company's use of the proceeds from the Notes
or any money paid to the Company or upon the Company's direction under any
provision of this Agreement, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the issuance or
sale of the Notes or pursuant to this Agreement other than its certificate of
authentication.
The Trustee makes no representations as to the value, condition or
adequacy of the Collateral or any part thereof, or as to the title of the
Company or any Guarantor thereto or as to the security afforded or intended to
be afforded thereby or hereby, or as to the validity or genuineness of any
securities at any time pledged and deposited with the Trustee hereunder, or as
to the validity, attachment, perfection, priority or enforceability of the Liens
in any of the Collateral created or intended to be created by this Indenture or
any Security Document. The Trustee shall have no responsibility to make or to
see to the making of any recording, filing or registration of any instrument or
notice (including any financing or continuation statement or any tax or
securities form) (or any rerecording, refiling or reregistration of any thereof)
at any time in any public office or elsewhere for the purpose of perfecting,
maintaining the perfection of or otherwise making effective the Lien of this
Indenture or any Security Document or for any other purpose, and shall have no
responsibility for insuring the Collateral or for paying any taxes, charges or
assessments on or relating to the Collateral or for otherwise maintaining the
Collateral, including, but not limited to, compliance with Environmental Laws,
the investigation
67
or remediation of Hazardous Materials, or any other environmental matter
affecting the Company, any Guarantor or the Collateral or any part thereof.
Other than to invest any amounts as directed by the Company in
accordance with Section 3.08 hereof, the Trustee shall have no duty as to any
Collateral in its possession or control or in the possession or control of any
agent or bailee or any income thereon or as to preservation of rights against
prior parties or any other rights pertaining thereto.
Except as required in connection with fulfilling its obligations
pursuant to Section 7.05 and Section 7.06 hereof, the Trustee shall have no duty
to ascertain or inquire as to the performance or observance of any of the terms
of this Indenture or any Collateral Document by the Company, any Guarantor or
any other Person that is a party thereto or bound thereby.
7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
actually known to a Responsible Officer of the Trustee, the Trustee shall mail
to Holders of Notes a notice of the Default or Event of Default within 30 days
after it occurs. Except in the case of a Default or Event of Default (a) in
payment of principal of, premium, if any, or interest on any Note or (b) in
compliance with Section 5.01 hereof, the Trustee may withhold the notice if and
so long as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Notes.
7.06 Reports by Trustee to Holders of the Notes.
Within 60 days after each September 1 beginning with the September 1
following the date of this Agreement, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(1) and Section 313(b)(2). The Trustee shall
also transmit by mail all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA Section 313(d).
The Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange or of any delisting thereof.
7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation for its acceptance of this Agreement and services hereunder as the
Company and the Trustee shall agree to in writing from time to time. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
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The Company shall indemnify the Trustee and any predecessor Trustee and
their employees, officers, directors and agents against any and all losses,
liabilities or expenses incurred by it or them arising out of or in connection
with the acceptance or administration of its duties under this Agreement,
including the costs and expenses of enforcing this Agreement (including this
Section 7.07) and the Notes against the Company and this Agreement, the Notes
and the Note Guarantees against the Guarantors and defending itself against any
claim (whether asserted by the Company, any Guarantor or any Holder or any other
Person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence or bad faith. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company shall not relieve the Company of
its obligations hereunder. The Company shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent, which shall not be
unreasonably withheld.
In addition to the foregoing, to the extent resulting from or in
connection with the execution, delivery, enforcement, performance, or
administration of this Indenture or any Security Document, and except to the
extent arising from the negligence or bad faith of the Trustee, the Company
shall defend, indemnify, and hold harmless the Trustee and any predecessor
Trustee and their employees, officers, directors and agents from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs, or
expenses of whatever kind or nature, known or unknown, contingent or otherwise,
arising out of, or in any way related to, (w) the presence, disposal, release,
or threatened release of any Hazardous Materials which are on, from, or
affecting soil, water, vegetation, buildings, personal property, persons,
animals, or otherwise; (x) any personal injury (including wrongful death),
property damage (real or personal) or natural resource damage arising out of or
related to such Hazardous Materials; (y) any third party claim brought or
threatened, settlement reached, or government order, or any policies or
requirements of the Trustee, which are based upon or in any way related to such
Hazardous Materials including, without limitation, attorney and consultant fees
and expenses, investigation and laboratory fees, court costs, and litigation
expenses, and (z) any violations of Environmental Laws.
For purposes of this Section 7.07 and Section 7.04 hereof:
"Hazardous Materials" means, without limit, any pollutant, contaminant
or hazardous, toxic, medical, biohazardous, or dangerous waste, substance,
constituent or material, defined or regulated as such in, or for the purpose of,
any applicable Environmental Law, including, without limitation, any asbestos,
any petroleum, oil (including crude oil or any fraction thereof), any
radioactive substance, any polychlorinated biphenyls, any toxin, chemical,
disease-causing agent or pathogen, and any other substance that gives rise to
liability under any applicable Environmental Law; and
"Environmental Law" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended ("CERCLA"), the Resource Conservation
and Recovery Act of 1976, as amended, and any other applicable federal, state,
local, or foreign statute, rule, regulation, order, judgment, directive, decree,
permit, license or common law as in
69
effect now, previously, or at any time during the term of this Indenture, and
regulating, relating to, or imposing liability or standards of conduct
concerning air emissions, water discharges, noise emissions, the release or
threatened release or discharge of any Hazardous Material into the environment,
the use, manufacture, production, refinement, generation, handling, treatment,
storage, transport or disposal of any Hazardous Material or otherwise concerning
pollution or the protection of the outdoor or indoor environment, or human
health or safety in relation to exposure to Hazardous Materials.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge or termination of this Agreement.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge or termination of this Agreement.
7.08 In addition to and without prejudice to its rights hereunder, when the
Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.01(g) or (h) hereof occurs, the expenses and the compensation for
the services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy
Law. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of a majority
in principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or
an order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a Custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in
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principal amount of the then outstanding Notes may, at the expense of the
Company, petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Agreement. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 60 days after the giving of such notice of
resignation or removal, the resigning or removed Trustee, as the case may be,
may petition, at the expense of the Company, any court of competent jurisdiction
for the appointment of a successor Trustee with respect to the Notes.
7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another Person, the
successor Person without any further act shall be the successor Trustee.
7.10 Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a Person
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $50 million
as set forth in its most recent published annual report of condition.
This Agreement shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
7.12 Co-trustees and Separate Trustees.
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At any time or times, for the purpose of meeting the legal requirements
of any jurisdiction in which any of the Collateral may at the time be located,
the Company and the Trustee shall have power to appoint, and, upon the written
request of the Trustee or of the Holders of at least a majority in principal
amount of the Notes then Outstanding, the Company shall for such purpose join
with the Trustee in the execution and delivery of all instruments and agreements
necessary or proper to appoint, one or more Persons approved by the Trustee and,
if no Event of Default shall have occurred and be continuing, by the Company
either to act as co-trustee, jointly with the Trustee, of all or any part of the
Collateral, or to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons, in the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. If the Company does not join in such appointment within fifteen
(15) days after the receipt by it of a request so to do, or if an Event of
Default shall have occurred and be continuing, the Trustee alone shall have
power to make such appointment.
Should any written instrument or instruments from the Company be
required by any co-trustee or separate trustee so appointed to more fully
confirm to such co-trustee or separate trustee such property, title, right or
power, any and all such instruments shall, on request, be executed, acknowledged
and delivered by the Company.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following conditions:
(a) the Notes shall be authenticated and delivered, and all
rights, powers, duties and obligations hereunder in respect of the custody of
securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustee hereunder, shall be exercised solely, by
the Trustee;
(b) the rights, powers, duties and obligations hereby conferred or
imposed upon the Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed either by the
Trustee or by the Trustee and such co-trustee or separate trustee jointly, as
shall be provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in which
any particular act is to be performed the Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties and
obligations shall be exercised and performed by such co-trustee or separate
trustee;
(c) the Company and the Trustee, at any time by an instrument in
writing, executed by them jointly, may accept the resignation of or remove any
such separate trustee or co-trustee, and in that case, by an instrument in
writing executed with the Trustee jointly, may appoint a successor to such
separate trustee or co-trustee, as the case may be, anything herein contained to
the contrary notwithstanding. In the event that the Company shall not have
joined in the execution of any instrument within 10 days after the receipt of a
written request from the Trustee so to do, or in case an Event of Default shall
have occurred and be continuing, the Trustee shall have the power to accept the
resignation of or remove any such separate trustee or co-trustee and to appoint
a successor without the concurrence of the Company, the Company hereby
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irrevocably appointing the Trustee their agent and attorney to act for them in
such connection in either of such contingencies;
(d) neither the Trustee nor any co-trustee or separate trustee
hereunder shall be personally liable by reason of any act or omission of any
other trustee hereunder; and
(e) any act of Holders delivered to the Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may at any time elect to have either Section 8.02 or 8.03
hereof be applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article VIII.
8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes and all
obligations of the Guarantors discharged with respect to the Note Guarantees on
the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company and the
Guarantors shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes and the Note Guarantees, respectively,
which shall thereafter be deemed to be "outstanding" only for the purposes of
Section 8.05 hereof and the other Sections of this Agreement referred to in (a)
and (b) below, and to have satisfied all its other obligations under such Notes
and this Agreement (and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging the same), except for
the following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to receive
solely from the trust fund described in Section 8.05 hereof, and as more fully
set forth in such Section, payments in respect of the principal of, premium and
interest on such Notes when such payments are due, (b) the Company's obligations
with respect to such Notes under Article II and Section 4.02 hereof, (c) the
rights, powers, trusts, duties, indemnities, privileges and immunities of the
Trustee hereunder and the Company's and each Guarantor's obligations in
connection therewith and (d) this Article VIII. Subject to compliance with this
Article VIII, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from their obligations under the covenants contained in Sections 4.03,
4.04, 4.05, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18 and
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4.19 hereof and clause (b)(iii) of Section 5.01 hereof with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Agreement and such Notes shall
be unaffected thereby. In addition, upon the Company's exercise under Section
8.01 hereof of the option applicable to this Section 8.03, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(d) through 6.01(f), Section 6.01(i) and Section 6.01(j) hereof shall not
constitute Events of Default.
8.04 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holders, 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 Company, 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;
(b) in the case of an election under Section 8.02 hereof,
the Company shall have delivered to the Trustee an Opinion of Counsel
in the United States reasonably acceptable to the Trustee confirming
that (i) the Company has received from, or there has been published by,
the Internal Revenue Service a ruling or (ii) since the date of this
Agreement, 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 of the
outstanding Notes 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;
(c) in the case of an election under Section 8.03 hereof,
the Company shall have delivered to the Trustee an Opinion of Counsel
in the United States reasonably acceptable to the Trustee confirming
that the Holders of the outstanding Notes will not
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recognize income, gain or loss for U.S. federal income tax purposes as
a result of such Covenant Defeasance and will be subject to U.S.
federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Covenant Defeasance had
not occurred;
(d) 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);
(e) such Legal Defeasance or Covenant Defeasance shall
not result in a breach or violation of, or constitute a default under
this Agreement, the New Credit Agreement, the Term Loan B Notes or any
other material agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an
Officer's Certificate stating that the deposit was not made by the
Company with the intent of preferring the Holders over any other
creditors of the Company or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Company; and
(g) the Company shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that the
conditions provided for in, in the case of the Officer's Certificate,
clauses (a), (b) and/or (c), (d), (e) and (f) and, in the case of the
Opinion of Counsel, clauses (a) (with respect to the validity and
perfection of the security interest), (b) and/or (c) and (e) of this
Section 8.04 have been complied with.
8.05 Deposited Money and U.S. Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Agreement, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium and interest, but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or U.S. Government
Obligations deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article VIII to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or U.S. Government Obligations held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
75
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
8.06 Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, if any,
or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in The New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any cash or U.S.
Government Obligations in accordance with Section 8.02 or 8.03 hereof by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application or such cash or U.S.
Government Obligations are insufficient to pay the principal of and interest on
the Notes when due, then the Company's and the Guarantor's obligations under
this Agreement and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as
the Trustee or Paying Agent is permitted to apply all such money in accordance
with Section 8.02 or 8.03 hereof; provided, however, that, if the Company makes
any payment of principal of, premium or interest on any Note following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Agreement, the Company and the
Trustee may amend or supplement this Agreement, the Note Guarantees or the Notes
without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
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(b) to provide for uncertificated Notes in addition to or
in place of certificated Notes;
(c) to provide for the assumption of the Company's or any
Guarantor's obligations to the Holders of the Notes in the case of a
merger or acquisition by a successor to the Company or such Guarantor
pursuant to Article V hereof;
(d) to make any change that does not materially adversely
affect the legal rights hereunder of any Holder of the Notes;
(e) to enter into additional or supplemental Security
Documents; or
(f) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Agreement under the TIA.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company and the Guarantors in the
execution of any amended or supplemental indenture authorized or permitted by
the terms of this Agreement and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental indenture that affects its
own rights, duties, liabilities, privileges, indemnities or immunities under
this Agreement or otherwise.
9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Agreement (including Section 4.15 hereof),
the Note Guarantees, the Security Documents and the Notes with the consent of
the Holders of at least a majority in principal amount of the Notes then
outstanding voting as a single class (including consents obtained in connection
with a tender offer or exchange offer for, or purchase of, the Notes), and,
subject to Sections 6.04 and 6.07 hereof, any existing Default (other than a
Default in the payment of the principal of, premium or interest on the Notes)
under, or compliance with any provision of, this Agreement, the Note Guarantees,
the Security Documents or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes voting
as a single class (including consents obtained in connection with a tender offer
or exchange offer for, or purchase of, the Notes). Without the consent of at
least 75% in principal amount of the Notes then outstanding (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Notes), no waiver or amendment to this Agreement may make any change in
the provisions of Article XII hereof that adversely affects the rights of any
Holder of Notes.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Company in the execution of such amended or supplemental indenture
unless such amended or supplemental indenture directly affects the Trustee's own
rights, duties,
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liabilities, privileges, indemnities or immunities under this Agreement or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes (including Additional Notes,
if any) then outstanding voting as a single class may waive compliance in a
particular instance by the Company with any provision of this Agreement, the
Notes or the Security Documents. However, without the consent of each Holder
affected, an amendment or waiver under this Section 9.02 may not (with respect
to any Notes held by a non-consenting Holder):
(a) change the maturity of any Note;
(b) reduce the amount, extend the due date or otherwise
affect the terms of any scheduled payment of interest on or principal
of the Notes;
(c) change the date on which any Notes are subject to
redemption or otherwise alter the provisions with respect to the
redemption of the Notes;
(d) make any Note payable in money or currency other than
that stated in the Notes;
(e) modify or change any provision of this Agreement or
its related definitions to affect the ranking of the Notes or any Note
Guarantee in a manner that adversely affects the rights of any Holder;
(f) reduce the percentage of Holders necessary to consent
to an amendment or waiver to this Agreement, the Notes or the Security
Documents;
(g) impair the rights of Holders to receive payments of
principal of or interest on the Notes;
(h) release any Guarantor from any of its obligations
under its Note Guarantee or this Agreement, other than as permitted by
this Agreement;
(i) release all or substantially all of the Collateral
from the Lien hereunder or under the Security Documents (except in
accordance with the provisions hereof or thereof); or
(j) make any change in these amendment and waiver
provisions.
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Any amendment to Section 4.15 or the related definitions that could
adversely affect the rights of any Holder shall require the consent of the
Holders of at least 66 2/3% in aggregate principal amount of the Notes then
outstanding.
In connection with any amendment, supplement or waiver, the Company
may, but shall not be obligated to, offer any Holder who consents to such
amendment, supplement or waiver, or to all Holders, consideration for such
Holder's consent to such amendment, supplement or waiver.
9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Agreement or the Notes shall be
set forth in an amended or supplemental indenture that complies with the TIA as
then in effect.
9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company may issue
and the Trustee shall, upon receipt of an Authentication Order, authenticate new
Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
9.06 Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental indenture authorized
pursuant to this Article IX if the amendment or supplement does not adversely
affect the rights, duties, liabilities, privileges, indemnities or immunities of
the Trustee. The Company may not sign an amendment or supplemental indenture
until the Board of Directors approves it. In executing any amended or
supplemental indenture, the Trustee shall be entitled to receive and (subject to
Section 7.01 hereof) shall be fully protected in relying upon, in addition to
the documents required by Section 12.04 hereof, an Officer's Certificate and an
Opinion of Counsel stating that the execution of such amended or supplemental
indenture is authorized by this Agreement.
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ARTICLE X
NOTE GUARANTEES
10.01 Guarantee.
Subject to this Article X, each of the Guarantors hereby, jointly and
severally, fully and unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Agreement,
the Notes or the obligations of the Company hereunder or thereunder, that: (a)
the principal of and interest on the Notes will be promptly paid in full when
due, whether at maturity, by acceleration, redemption, repurchase or otherwise,
and interest on the overdue principal of and interest on the Notes, if any, if
lawful, and all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other obligations,
that same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. Failing payment when due of any amount so guaranteed
or any performance so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately. Each Guarantor
agrees that this is a guarantee of payment and not a guarantee of collection.
Each Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity or enforceability of the Notes or
this Agreement, the absence of any action to enforce the same, any waiver or
consent by any Holder of the Notes with respect to any provisions hereof or
thereof, the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor. Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and this Agreement.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any Custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article VI
hereof for the purposes of this Note Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article VI hereof, such
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obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Note Guarantee. Each Guarantor
that makes payments under its Note Guarantee is entitled to a contribution from
each other Guarantor in a pro rata amount based on the net assets of each
Guarantor.
10.02 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 Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to any
Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of each
Guarantor under its Note Guarantee will be limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor (including, without limitation, any guarantees under the New Credit
Agreement and the Term Loan B Notes permitted under Section 4.09 hereof) and
after giving effect to any collections from or payments made by or on behalf of
any other Guarantor in respect of the obligations of such other Guarantor under
its Note Guarantee or pursuant to its contribution obligations under this
Agreement, result in the obligations of such Guarantor under its Note Guarantee
not constituting a fraudulent conveyance or fraudulent transfer under federal or
state law.
10.03 Execution and Delivery of Note Guarantee.
To evidence its Note Guarantee set forth in Section 10.01, each
Guarantor hereby agrees that a notation of such Note Guarantee substantially in
the form included in Exhibit B shall be endorsed by an Officer of such Guarantor
on each Note authenticated and delivered by the Trustee and that this Agreement
shall be executed on behalf of such Guarantor by an Officer.
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 10.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Agreement or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guarantee is endorsed, the Note Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Note Guarantee set forth
in this Agreement on behalf of the Guarantors.
10.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 10.05, no Guarantor may
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, whether or not affiliated with such Guarantor,
unless:
(a) either:
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(i) such Guarantor will be the surviving or continuing
Person; or
(ii) 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 and this
Agreement;
(b) immediately after giving effect to such transaction
on a pro forma basis (and treating any Indebtedness that becomes an
obligation of the resulting, surviving or transferee Person as a result
of such transaction as having been issued by such Person at the time of
such transaction), no Default or Event of Default shall have occurred
and be continuing; and
(c) the Company delivers to the Trustee an Officer's
Certificate stating that such consolidation, merger or transfer and its
Note Guarantee, if any, complies with this Agreement.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Agreement to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Agreement as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Agreement as though all of such Note
Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles IV and V hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Agreement or in any of the
Notes shall prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or shall prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.
10.05 Releases Following Sale of Assets.
In the event of a sale or other disposition of all or substantially all
of the assets of any Guarantor, by way of merger, consolidation or otherwise, or
a sale or other disposition of all of the Equity Interests of any Guarantor then
held by the Company and the Restricted Subsidiaries, or the Company properly
designates any Restricted Subsidiary that is a Guarantor as an Unrestricted
Subsidiary or any Guarantor is released from its Guarantees of Indebtedness of
the Company such that such Guarantor would not be required to provide a
Guarantee of the Notes under Section 4.18 hereof, then such Guarantor (in the
event of a sale or other disposition, by way of merger, consolidation or
otherwise, of all of the Equity Interests of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other disposition of all or
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substantially all of the assets of such Guarantor) will be released and relieved
of any obligations under its Note Guarantee; provided, however, that (i) the Net
Available Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Agreement, to the extent required
thereby, and (ii) such sale, other disposition or designation would not result
in a Default hereunder. Upon delivery by the Company to the Trustee of an
Officer's Certificate and an Opinion of Counsel to the effect that such sale or
other disposition was made by the Company in accordance with the provisions of
this Agreement, the Trustee shall execute any documents reasonably required in
order to evidence the release of any Guarantor from its obligations under its
Note Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this Agreement
as provided in this Article X.
ARTICLE XI
COLLATERAL; ESCROW
11.01 Delivery of Security Documents.
Not later than the Issue Date, the Company and the Guarantors party
thereto shall have executed and delivered to the Trustee and the Collateral
Agent, for the benefit of the Secured Parties:
(a) the Pledge Agreement;
(b) the Security Agreement;
(c) The Pay Proceeds Agreements;
(d) Mortgages with respect to the Sale Property and the
Surplus Property;
(e) certificates representing the Oxford Stock;
(f) The Sale Agreements;
(g) all documents and instruments, including Uniform
Commercial Code financing statements, required by law to be filed,
registered or recorded to create or perfect the Liens in the Collateral
intended to be created by the Security Agreement and the Mortgages; and
(h) all documents and instruments required to be
delivered as of the Issue Date under the Security Documents, including
any title insurance policies, casualty insurance policies and policy
endorsements, as well as any opinions of counsel, as may be required
thereunder.
11.02 Recording and Opinions.
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Not later than the Issue Date, the Company and the Guarantors, at their
sole expense, will cause the Security Documents to be recorded, registered and
filed in such manner and in such places as may be necessary to create or perfect
the Liens in the Collateral intended to be created by the Security Agreement and
the Mortgages. Thereafter, until the release of the Collateral as provided in
Section 11.04 or in the Security Documents, the Company and the Guarantors, at
their sole expense, will cause the Security Documents to be re-recorded,
re-registered or refilled in such manner and in such places as may be necessary
in order to fully preserve and protect the Liens in the Collateral created by
the Security Documents.
The Company shall furnish to the Collateral Agent and the Trustee
promptly after the Issue Date (and in any case within 60 days of the Issue Date)
and on each anniversary of the Issue Date, an Opinion of Counsel, either (i) (A)
stating that, in the opinion of such counsel, action has been taken with respect
to the recording, registering, filing, re-recording, re-registering and
re-filing of all supplemental indentures, financing statements, continuation
statements or other instruments of further assurance as is necessary to maintain
the Lien created by the Security Documents and reciting with respect to the
security interests in the Collateral the details of such action or referring to
prior opinions of counsel in which such details are given, (B) stating that,
based on relevant laws as in effect on the date of such Opinion of Counsel, all
financing statements and continuation statements have been executed and filed
that are necessary as of such date and during the succeeding 12 months fully to
preserve and protect, to the extent such protection and preservation are
possible by filing, the rights of the Holders and the Collateral Agent and the
Trustee hereunder and under the Security Documents with respect to the security
interests in the Collateral, or (ii) stating that, in the opinion of such
counsel, no such action is necessary to maintain such Lien and assignment.
11.03 Possession and Use of Collateral.
So long as no Event of Default has occurred and is continuing, the
Company and the Guarantors will have the right to remain in possession of and
exercise complete control over the Collateral, except for such of the Collateral
as is required to be in the possession of the Collateral Agent in order to
perfect the Liens in such Collateral granted by the Security Documents.
11.04 Release and Disposition of Collateral.
The Collateral shall be released from the Lien of the Security
Documents as expressly provided therein and as follows:
(a) In connection with and to the extent necessary to complete any
Asset Sale of the Collateral permitted under Section 4.10 hereof;
(b) Upon satisfaction and discharge of this Agreement as provided
in Article XIII hereof; and
(c) Upon Legal Defeasance or Covenant Defeasance as provided in
Article VIII hereof.
Notwithstanding the foregoing, any non-cash consideration received in
an Asset Sale involving the Collateral shall constitute proceeds of the
Collateral and shall remain subject to a
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Lien in favor of the Collateral Agent, for the benefit of the Secured Parties.
In furtherance of the forgoing, the Company hereby grants to the Collateral
Agent a security interest in all non-cash assets received by the Company in
consideration of an Asset Sale of Collateral, including without limitation all
accounts, chattel paper, commodity accounts, commodity contracts, Deposit
Accounts, documents, equipment, fixtures, general intangibles, goods,
instruments, inventory, investment property, letter-of-credit rights, noncash
proceeds, payment intangibles, and supporting obligations. The Company and the
Guarantors, at their sole expense, shall execute, deliver, record, file and
register any and all documents and instruments necessary to create and perfect
such Lien.
To the extent applicable, the Company shall cause TIA Section 314(d) to
be complied with in connection with any release of Collateral from the Liens of
the Security Documents. Any certificate or opinion required by TIA Section
314(d) may be made by means of an Officer's Certificate, except in cases in
which TIA Section 314(d) requires that such certificate or opinion be made by an
independent Person.
11.05 Escrowed Restated SAC Notes.
Not later than the Issue Date, the Company and U-Haul shall have executed and
delivered to the Trustee the Restated Notes Escrow Agreement and deposited with
the Trustee the Escrowed Restated SAC Notes to be held in the Restated Notes
Escrow. The Company and U-Haul shall take all actions necessary or appropriate
to cause principal payments and principal pre-payments under the Escrowed
Restated SAC Notes or any New SAC Notes to be delivered directly by the makers
of such Escrowed Restated SAC Notes directly to the Collateral Agent to be held
in the Restated Note Escrow Account, including, without limitation execution of
Pay Proceeds Agreements in respect of the Escrowed Restated SAC Notes (provided
that no interest that is paid on account of the Escrowed Restated SAC Notes,
including, without limitation Capital Proceeds Contingent Interest, Cash Flow
Contingent Interest, Pay Rate Interest and Basic Interest (all as defined in the
Restated SAC Notes) shall be subject to delivery to the Collateral Agent and all
such interest may be paid directly to the depositor of such Escrowed Restated
SAC Notes). The Restated SAC Notes Escrow Account shall constitute Collateral
pursuant to the Security Agreement, shall be a Deposit Account opened at The
Bank of New York, as depository bank, and shall be pledged to, under the
exclusive control of and held in the name of the Collateral Agent pursuant to
the Security Agreement. All proceeds from the payment of principal due under the
Escrowed Restated SAC Notes received by the Trustee or the Collateral Agent,
regardless of whether such proceeds are deposited in the Restated SAC Notes
Escrow Account, shall be held as Collateral under the Security Agreement and
promptly deposited into the Restated SAC Notes Escrow Account.
11.06 Collateral Agent.
(a) The Bank of New York will also serve as Collateral Agent for
the benefit of the Holders. The Collateral Agent is hereby duly constituted and
appointed as agent by Trustee to hold the liens and security interests in and to
the Collateral on Trustee's behalf. Trustee and the Holders hereby authorize and
direct the Collateral Agent to enter into the Security Documents. Upon further
instruction of Trustee, the Collateral Agent shall enter into any other
Collateral
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Documents that the Trustee deems necessary or advisable to carry out the
purposes of the Pledge Agreement.
(b) The Collateral Agent will be subject to such directions as may
be given it by the Trustee from time to time as required or permitted by this
Indenture. The Collateral Agent shall not release or terminate any Lien on any
Collateral unless and until it shall have received instructions in respect
thereof from Trustee.
(c) The Company will deliver to the Trustee copies of all Security
Documents delivered to the Collateral Agent.
(d) The Collateral Agent will be accountable only for amounts that
it actually receives as a result of the enforcement of the Liens granted
pursuant to the Security Documents.
(e) In acting as Collateral Agent, the Collateral Agent may rely
upon and enforce each and all of the rights, powers, protections, immunities,
indemnities and benefits of the Trustee under Sections 7.02, 7.03, 7.04, 7.07,
7.08 and 7.09 mutatis mutandis, and, in connection therewith, references to the
Trustee shall be deemed to include the Collateral Agent and references to the
Indenture shall be deemed to include the Security Documents.
(f) Each successor Trustee will become the successor Collateral
Agent as and when the successor Trustee becomes the Trustee unless, at the time
such successor Trustee becomes Trustee, the immediately preceding Trustee was
not the Collateral Agent.
11.07 Authorization of Actions to Be Taken.
(a) Each Holder, by its acceptance thereof, consents and agrees to
the terms of each Security Document, as originally in effect and as amended,
supplemented or replaced from time to time in accordance with its terms or the
terms of this Indenture, authorizes and directs the Trustee and the Collateral
Agent to enter into the Security Documents, and authorizes and empowers each of
the Trustee and the Collateral Agent to bind the Holders as set forth in the
Security Documents and to perform its obligations and exercise its rights and
powers thereunder.
(b) The Collateral Agent and the Trustee are authorized and
empowered to receive for the benefit of the Holders any funds collected or
distributed under the Security Documents and to make further distributions of
such funds to the Holders according to the provisions of this Indenture and the
Security Documents. Funds received into the 3.08(b) Account and the Restated SAC
Notes Escrow Account shall be held by Collateral Agent as Collateral in Deposit
Accounts or investment accounts established with Collateral Agent as depository
bank in Collateral Agent's own name. Such Deposit Accounts or investment
accounts will be under the exclusive control of Collateral Agent within the
meaning of Uniform Commercial Code Sections 9-314, 9-104, 9-106 and 8-106 and
neither Company nor any Guarantor shall have any right to direct the disposition
of such accounts until liens and security interest in favor of the Collateral
Agent has terminated. The Collateral Agent and Trustee are further authorized
and empowered to receive and hold as Collateral certificated securities and
notes pledged to the Collateral Agent pursuant to the Security Documents.
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(c) Notwithstanding any provision of this Indenture or any
Security Document to the contrary, the Collateral Agent shall take such action
with respect to the Collateral and the Security Documents (including, but not
limited to, exercising the rights and remedies provided therein) as directed in
writing by the Trustee, provided that the Collateral Agent shall not be
obligated to take any action which is in conflict with any provisions of law,
this Indenture or the Security Documents or with respect to which the Collateral
Agent has not received adequate security.
(d) The Trustee may, in its sole discretion and without the
consent of the Holders, direct, on behalf of the Holders, the Collateral Agent
to take all actions it deems necessary or appropriate in order to:
(i) foreclose upon or otherwise enforce any or all of the
Liens granted by the Security Documents;
(ii) enforce any of the terms of the Security Documents;
or
(iii) collect and receive payment of any and all amounts
owing under this Indenture, the Notes and the Security Documents.
(e) The Trustee is authorized and empowered to institute and
maintain, or direct the Collateral Agent to institute and maintain, such suits
and proceedings as it may deem expedient to protect or enforce the Liens granted
by the Security Documents or to prevent any impairment of Collateral by any acts
that may be unlawful or in violation of the Security Documents or this
Indenture, and such suits and proceedings as the Trustee or the Collateral Agent
may deem expedient to preserve or protect its interests and the interests of the
Holders in the Collateral, including power to institute and maintain suits or
proceedings to restrain the enforcement of or compliance with any legislative or
other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment,
rule or order would impair the security interest hereunder or be prejudicial to
the interests of Holders, the Trustee or the Collateral Agent.
(f) The Collateral Agent shall upon instruction of Trustee file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Collateral Agent (including any
claim for the reasonable compensation, expenses, taxes, disbursements and
advances of the Collateral Agent, its agents and counsel) and Trustee allowed in
any judicial proceedings relating to the Parent or any other obligor upon the
Notes, any of their respective creditors or any of their respective 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
Trustee to make such payments to the Collateral Agent and, if the Collateral
Agent shall consent to the making of such payments directly to Trustee, to pay
to the Collateral Agent any amount due to it for the reasonable compensation,
expenses, taxes, disbursements and advances of the Collateral Agent, its agents,
consultants and counsel, and any other amounts due the Collateral Agent. Nothing
herein contained shall be deemed to authorize the Collateral Agent to authorize
or consent to or accept or adopt on behalf of Trustee any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of
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Trustee, or to authorize the Collateral Agent to vote in respect of the claim of
Trustee in any such proceeding.
(g) The Collateral Agent shall not be personally liable for any
acts, omissions, errors of judgment or mistakes of fact or law made, taken or
omitted to be made or taken by it in accordance with this Indenture or any
Security Document (including acts, omissions, errors or mistakes with respect to
the Collateral), except to the extent resulting from the Collateral Agent's
negligence, bad faith or willful misconduct. In no event shall the Collateral
Agent be liable for incidental, indirect, special or consequential damages,
regardless of the form of action and even if the same were foreseeable.
Notwithstanding anything set forth herein to the contrary, the Collateral Agent
shall have a duty of reasonable care with respect to any Collateral which is
delivered to the Collateral Agent and is in the Collateral Agent's possession
and control.
(h) The Collateral Agent shall not be liable for any claims,
losses, liabilities, damages, costs, expenses and judgments (including
reasonable attorneys' fees and expenses) due to forces beyond the reasonable
control of the Collateral Agent, including strikes, work stoppages, acts of God,
and interruptions, losses or malfunctions of utilities, communications or
computer (software or hardware) services.
(i) The Collateral Agent shall have no duty as to any Collateral
in its possession or control, other than those duties specifically set forth
herein, or the possession or control of any agent or bailee or any income
thereon or as to the preservation or rights against prior parties or any other
rights pertaining thereto. The Collateral Agent shall not be liable or
responsible for any loss or diminution in the value of any of the Collateral by
reason of the act or omission of any carrier, forwarding agency or other agent
or bailee selected by the Collateral Agent in good faith.
(j) All moneys received by the Collateral Agent under or pursuant
to any provision of this Indenture or any Security Document shall be paid over
or delivered to the Trustee in the form received (with any necessary
endorsements) for application by the Trustee pursuant to the provisions of this
Indenture.
(k) The Collateral Agent may execute any power and perform any
duty under this Indenture or any Security Document either directly or by or
through agents, nominees or attorneys in fact. The Collateral Agent may act and
conclusively rely, and shall be protected in acting and conclusively relying on,
the opinion or advice of, or information obtained from, any counsel (which shall
include counsel to the Company), accountant, appraiser or other expert or
adviser, whether retained or employed by the Collateral Agent or the Trustee in
relation to any matter in connection with this Indenture, the Security Documents
or any other document, instrument or writing. The Collateral Agent shall be
entitled to rely on the advice of counsel selected by it concerning all matters
pertaining to such powers and duties. The Collateral Agent shall not be
responsible for any acts or omissions, including any negligence or misconduct,
of any agents, nominees or attorneys in fact selected by it with due care.
(l) The Collateral Agent may consult with counsel, accountants and
other experts selected by it, and any opinion of independent counsel, any such
accountant, and any such other expert shall be full and complete authorization
and protection in respect of any action taken or
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suffered by it hereunder in accordance therewith. The Collateral Agent shall
have the right at any time to seek instructions concerning the administration of
the Collateral from any court of competent jurisdiction.
(m) The Collateral Agent may rely, and shall be fully protected in
acting, upon any resolution, statement, certificate, instrument, opinion,
report, notice, request, consent, order, bond or other paper or document which
it has no reason to believe to be other than genuine and to have been signed or
presented by the proper party or parties or, in the case of facsimile, to have
been sent by the proper party or parties. In the absence of its negligence, bad
faith or willful misconduct, the Collateral Agent may rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Collateral Agent and conforming to the
requirements of this Indenture or any Security Document.
(n) If the Collateral Agent has been requested or is otherwise
required to take action pursuant to this Indenture or any Security Document, the
Collateral Agent shall not be under any obligation to exercise any of the rights
or powers vested in the Collateral Agent by this Indenture or any Security
Document unless the Collateral Agent shall have been provided adequate security
and indemnity against the costs, expenses and liabilities which may be incurred
by it in complying with such request or direction, including such reasonable
advances as may be requested by the Collateral Agent. Under no circumstances
shall the Collateral Agent be required to expend or risk its own funds or incur
or risk any liability.
(o) The Collateral Agent shall be obliged to perform such duties
and only such duties as are specifically set forth in this Indenture or any
Security Document, and no implied covenants or obligations shall be read into
this Indenture or any Security Document against the Collateral Agent. The
Collateral Agent shall not be liable with respect to any action taken or omitted
by it in accordance with the direction of the Trustee.
11.08 Co-Collateral Agents and Separate Collateral Agents.
(a) Notwithstanding any other provisions of this Indenture or any
other Security Document, at any time, for the purpose of meeting any legal
requirement of any jurisdiction in which any part of the Collateral may at the
time be located, the Collateral Agent shall have the power and may execute and
deliver all instruments necessary to appoint one or more Persons to act as a
co-collateral agent or co-collateral agents, or separate collateral agent or
separate collateral agents, of all or any part of the Collateral, and to vest in
such Person or Persons, in such capacity and for the benefit of the Holders,
such title to the Collateral, or any part thereof, and subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Collateral Agent may reasonably consider necessary or desirable for such
purpose. No co-collateral agent or separate collateral agent shall be required
to meet the terms of eligibility as a successor trustee under Section 7.10
hereof and no notice to Holders of the appointment of any co-collateral agent or
separate collateral agent shall be required under Section 7.08 hereof.
(b) Every co-collateral agent or separate collateral agent shall,
to the extent permitted by law, be appointed and act subject to the following
provisions and conditions:
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(i) all rights, powers, duties and obligations conferred
or imposed upon the Collateral Agent shall be conferred or imposed upon
and exercised or performed by the Collateral Agent and such
co-collateral agent or separate collateral agent jointly (it being
understood that such separate co-collateral agent or separate
collateral agent is not authorized to act separately without the
Collateral Agent joining in such act), except to the extent that under
any law of any jurisdiction in which any particular act or acts are to
be performed the Collateral Agent shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to Collateral or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such co-collateral agent or separate collateral
agent, but solely at the direction of the Collateral Agent; and
(ii) the Collateral Agent may at any time accept the
resignation of or remove any co-collateral agent or separate collateral
agent.
(c) Any notice, request or other writing given to the Collateral
Agent shall be deemed to have been given to each of the then co-collateral
agents or separate collateral agents, as effectively as if given to each of
them. Every instrument appointing any co-collateral agent or separate collateral
agent shall refer to this Indenture and the conditions of this Section 11.08.
Each co-collateral agent or separate collateral agent, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Collateral Agent or
separately, as may be provided therein, subject to all the provisions of this
Indenture, specifically including every provision of this Indenture relating to
the conduct of, affecting the liability of, or affording protection or rights
(including the rights to compensation, reimbursement and indemnification
hereunder) to, the Collateral Agent. Every such instrument shall be filed with
the Collateral Agent.
(d) Any co-collateral agent or separate collateral agent may at
any time constitute the Collateral Agent, its agent or attorney-in-fact with
full power and authority, to the extent not prohibited by law, to do any lawful
act under or in respect of this Indenture and the Security Documents on its
behalf and in its name. If any co-collateral agent or separate collateral agent
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Collateral Agent, to the extent permitted by law, without the appointment of a
new or successor co-collateral agent or separate collateral agent.
ARTICLE XII
SUBORDINATION
12.01 Agreement to Subordinate.
The Company agrees, and each Holder by accepting a Note agrees, that
except as set forth in Section 3.08, the Indebtedness evidenced by, and the
payment of principal of and interest on, the Notes is subordinated in right of
payment, to the extent and in the manner provided in this Article XII, to the
prior payment in full in cash or discharge of all Senior Indebtedness, and that
the subordination is for the benefit of and enforceable by the holders of Senior
Indebtedness. All
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provisions of this Article XII shall be subject in all respects to Section 3.08,
Section 12.11 and Section 12.12 hereof.
12.02 Liquidation, Dissolution or Bankruptcy.
Upon any payment or distribution of assets or securities of the Company
of any kind or character, whether in cash, property or securities, upon any
dissolution or winding up or total or partial liquidation or reorganization of
the Company, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other proceedings or upon an assignment for the benefit of
creditors or any other marshalling of the assets and liabilities of the Company
(an "Insolveny Event"), all Senior Indebtedness shall first be paid in full in
cash or discharged, or payment provided for in cash or Cash Equivalents, in a
manner satisfactory to the holders of Senior Indebtedness, before any direct or
indirect payments or distributions, including, without limitation, by exercise
of set-off, of any cash, property or securities on account of principal of or
interest on the Notes and to that end the holders of Senior Indebtedness shall
be entitled to receive (pro rata on the basis of the respective amounts of
Senior Indebtedness held by them) directly, for application to the payment
thereof (to the extent necessary to pay all Senior Indebtedness in full after
giving effect to any substantially concurrent payment or distribution to or
provision for payment to the holders of such Senior Indebtedness), any payment
or distribution of any kind or character, whether in cash, property or
securities, to which the Holders of the Notes would be entitled but for this
Article XII, except that the Holders of the Notes may receive and retain (i)
equity securities of the Company or debt securities of the Company that are
subordinated to Senior Indebtedness (and any debt securities issued in exchange
for Senior Indebtedness) to substantially the same extent as, or to a greater
extent than, the Notes are subordinated to the Senior Indebtedness pursuant to
this Article XII and (ii) the proceeds of any sale of Collateral regardless of
whether such sale occurs in respect of or in connection with an Insolvency
Event. The holders of Senior Indebtedness are hereby authorized to file an
appropriate claim for and on behalf of the Holders if the Holders or any of them
do not file, and there is not otherwise filed on behalf of the Holders, a proper
claim or proof of claim in the form required in any such proceeding prior to 30
days before the expiration of the time to file such claim or claims.
12.03 Default on Senior Indebtedness.
The Company may not make any direct or indirect payment to the Trustee
or any Holder of principal of or interest on, the Notes, whether pursuant to the
terms of the Notes or this Indenture, upon acceleration or otherwise, if at the
time of such payment there exists (i) a default in the payment of all or any
portion of the Obligations owing in connection with any Senior Indebtedness, or
(ii) any other default under any document or instrument governing or evidencing
any Senior Indebtedness, and the Trustee has received written notice of such
default from an authorized representative of the holders of Senior Indebtedness,
and, in either case, such default shall not have been cured or waived in
writing; provided, however, that if within the period specified in the next
sentence with respect to a default referred to in clause (ii) above, the holders
of Senior Indebtedness have not declared the Senior Indebtedness to be
immediately due and payable (or have declared such Senior Indebtedness to be
immediately due and payable and within such period have rescinded such
acceleration), then and in that event, payment of principal of and interest on
the Notes shall be resumed. With respect to any default under clause
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(ii) above, the period referred to in the preceding sentence shall commence upon
receipt by the Trustee of a written notice or notices of the commencement of
such period from such representative, and shall end at the completion of the
180th day after the beginning of such period. Only one such 180 day period may
commence within any 360 consecutive days. Upon termination of any such period,
the Company shall resume payments on account of the principal of and interest on
the Notes, subject to the provisions of this Article XII.
12.04 Obligations of the Trustee and the Holders.
(a) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, the Trustee or any Holder shall have
received any payment on account of the Notes at a time when such payment is
prohibited by such provision before the Senior Indebtedness is paid in full in
cash or discharged, then and in such event, such payment or distribution shall
be received and held in trust by the Trustee or such Holders apart from their
other assets and paid over or delivered to the holders of the Senior
Indebtedness remaining unpaid to the extent necessary to pay in full in cash the
obligations under such Senior Indebtedness in accordance with its terms and
after giving effect to any concurrent payment or distribution to the holders of
such Senior Indebtedness.
(b) Nothing contained in this Article XII will limit the right of
the Trustee or the Holders of the Notes to take any action to accelerate the
maturity of the Notes; provided, however, that the right of the Holders to
receive any payment from the Company of principal of, or interest on, the Notes
upon such acceleration shall be subject to the provisions of Section 12.03
hereof.
(c) Upon any payment or distribution of assets or securities
referred to in this Article XII, the Trustee and the Holders shall be entitled
to rely (i) upon any order or decree of a court of competent jurisdiction in
which any proceedings of the nature referred to in Section 12.02 are pending;
(ii) upon a certificate of the liquidating trustee or agent or other Person
making such payment or distribution to the Trustee or to the Holders or (iii)
upon the authorized representatives for the respective holders of Senior
Indebtedness for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article XII.
(d) In the event that the Trustee determines, in good faith, that
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article XII, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and other facts pertinent to the rights of such
Person under this Article XII, 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.
12.05 Subrogation.
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Upon the payment in full in cash or discharge of all Senior
Indebtedness, the Holders of the Notes shall be subrogated to the extent of the
payments or distributions made to the holders of, or otherwise applied to
payment of, the Senior Indebtedness pursuant to the provisions of this Article
XII and to the rights of the holders of Senior Indebtedness to receive payments
or distributions of assets of the Company made on the Senior Indebtedness until
the Notes shall be paid in full; and for the purposes of such subrogation, no
payments or distributions to holders of Senior Indebtedness of any cash,
property or securities to which Holders of the Notes would be entitled except
for the provisions of this Article XII, and no payment over pursuant to the
provisions of this Article XII to holders of Senior Indebtedness by the Holders,
shall, as between the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Notes, be deemed to be payment by Company to
or on account of Senior Indebtedness, it being understood that the provisions of
this Article XII are solely for the purpose of defining the relative rights of
the holders of Senior Indebtedness, on the one hand, and the Holders of the
Notes, on the other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article XII shall have been
applied, pursuant to the provisions of this Article XII, to the payment of
Senior Indebtedness, then and in each such case, the Holders shall be entitled
to receive from the holders of Senior Indebtedness at the time outstanding any
payments or distributions received by such holders of Senior Indebtedness in
excess of the amount sufficient to pay all Senior Indebtedness in full in cash.
12.06 Obligations of Company Unconditional.
Nothing contained in this Article XII or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as between the Company and the
Holders, the obligations of the Company, which are absolute and unconditional,
to pay to the Holders the principal of and 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 of the Notes and creditors
of the Company other than the holders of the Senior Indebtedness, nor shall
anything herein or therein prevent any Holder from exercising all remedies
otherwise permitted by applicable law upon the occurrence of a Default or Event
of Default under this Indenture, subject to the rights, if any, under this
Article XII of the holders of Senior Indebtedness in respect of cash, property
or securities of the Company received upon the exercise of any such remedy.
The failure by the Company to make a payment on account of principal
of, or interest on, the Notes by reason of any provision of this Article XII
shall not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
12.07 Notice by the Company.
The Company shall give prompt written notice to the Trustee and the
Paying Agent of any fact known to the Company which would prohibit the making of
any payment on or in respect of the Notes, but failure to give such notice shall
not affect the subordination of the Notes to the Senior Indebtedness provided in
this Article XII. Notwithstanding the provisions of this Article XII or any
other provision of this Indenture or the Notes, neither the Trustee nor the
Paying Agent shall be charged with knowledge of the existence of any facts which
would
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prohibit the making of any payment to or in respect of the Notes, unless and
until the Trustee and the Paying Agent shall have received written notice
thereof from the Company or the respective authorized representatives of Senior
Indebtedness, and, prior to the receipt of any such written notice, subject to
the provisions of this Article XII, the Trustee and the Paying Agent shall be
entitled in all respects to assume no such facts exist. Nothing contained in
this Section 12.07 shall limit the right of the holders of Senior Indebtedness
to recover payments as contemplated by this Article XII. This Section 12.07
shall not apply to any amount payable to the Trustee under Section 3.08.
12.08 Right as Holder of Senior Indebtedness.
The Trustee or any Holder in its individual capacity shall be entitled
to all the rights set forth in this Article XII with respect to any Senior
Indebtedness which may at any time be held by it, to the same extent as any
other holder of Senior Indebtedness, and nothing in this Indenture shall deprive
the Trustee or such Holder of any of its rights as such holder.
12.09 Reinstatement.
The provisions of this Article XII shall continue to be effective or be
reinstated, and the Senior Indebtedness shall not be deemed to be paid in full
or discharged, as the case may be, if at any time any payment of any of the
Senior Indebtedness is rescinded or must otherwise be returned by the holder
thereof upon the insolvency, bankruptcy or reorganization of the Company or
otherwise, all as though such payment had not been made. This Section 12.09
shall survive the satisfaction and discharge or termination of this Agreement.
12.10 Rights of Trustee and Paying Agent.
Notwithstanding Section 12.03, the Trustee or Paying Agent may continue
to make payments on the Notes and shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any such payments,
unless not less than two Business Days prior to the date of such payment, a
Responsible Officer of the Trustee shall have received at the Corporate Trust
Office of the Trustee written notice of facts that would cause the payment of
any principal of and interest on the Notes to violate this Article XII. The
Company, the Registrar or co-registrar, the Paying Agent, an authorized
representative or a holder of Senior Indebtedness may give the notice; provided,
however, that, if an issuer of Senior Indebtedness has an authorized
representative, only such representative may give the notice. The Trustee in its
individual or any other capacity may hold Senior Indebtedness with the same
rights it would have if it were not Trustee. The Registrar and co-registrar and
the Paying Agent may do the same with like rights.
12.11 Trust Moneys Not Subordinated.
Notwithstanding anything contained hereto the contrary, payments to the
Holders of the Notes from money or the proceeds of U.S. Government Obligations
held in trust under Article VIII by the Trustee for the payment of principal of
and interest on the Notes shall not be subordinated to the prior payment of any
Senior Indebtedness or subject to the terms and provisions of this Article XII,
and none of the Holders or the Trustee shall be obligated to pay over any such
amounts to any holder of Senior Indebtedness.
94
12.12 No Subordination with respect to Collateral.
Notwithstanding anything contained herein to the contrary, neither (i)
payments to the Holders of the Notes pursuant to Section 3.08 hereof nor (ii)
payments to the Holders of the Notes in respect of the exercise of any rights
with respect to the Collateral under the Security Documents nor (iii) payments
to the Holders of the Notes that are otherwise in respect of the Collateral
shall be subordinated to the prior payment of any Senior Indebtedness or subject
to the terms and provisions of this Article XII, and none of the Holders or the
Trustee shall be obligated to pay over any such amounts to any holder of Senior
Indebtedness. In addition, nothing contained herein shall in any way restrict or
prohibit the Holders of the Notes, the Trustee or the Collateral Agent from
taking any action to enforce the rights and remedies provided to the Secured
Parties with respect to the Collateral under the Security Documents or
applicable law.
12.13 Trustee to Effectuate Subordination.
Each Holder of a Note by the Holder's acceptance thereof authorizes and
directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination between
the Holders and the holders of Senior Indebtedness as provided in this Article
XII, and appoints the Trustee to act as the Holder's attorney-in-fact for any
and all such purposes.
12.14 Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall mistakenly pay over or distribute to Holders or the Company or any other
Person, money or assets to which any holders of Senior Indebtedness shall be
entitled by virtue of this Article XII or otherwise.
12.15 Reliance by Holders of Senior Indebtedness on Subordination Provisions.
Each Holder by accepting a Note acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Indebtedness, whether such
Senior Indebtedness was created or acquired before or after the issuance of the
Notes, to acquire and continue to hold, or to continue to hold, such Senior
Indebtedness and such holder of Senior Indebtedness shall be deemed conclusively
to have relied on such subordination provisions in acquiring and continuing to
hold, or in continuing to hold, such Senior Indebtedness.
12.16 Trustee's Rights.
The Trustee's rights to compensation, reimbursement of expenses and
indemnification under Sections 6.10 and 7.07 are not subordinated.
ARTICLE XIII
SATISFACTION AND DISCHARGE
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13.01 Satisfaction and Discharge.
This Agreement shall be discharged and will cease to be of further
effect (except as to rights of registration of transfer or exchange of Notes
which shall survive until all Notes have been canceled) as to all outstanding
Notes issued hereunder, when either:
(a) 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 Company and thereafter
repaid to the Company or discharged from this trust) have been
delivered to the Trustee for cancellation, or
(b) (i) all Notes not delivered to the Trustee for
cancellation otherwise have become due and payable or have been called
for redemption pursuant to Section 3.07 or Section 3.08 hereof, and the
Company 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,
(ii) the Company has paid all sums payable by it
under this Agreement and the Security Documents,
(iii) the Company has 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
(iv) the Holders have a valid, perfected,
exclusive security interest in this trust.
In addition, the Company shall deliver an Officer's Certificate and an
Opinion of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.
13.02 Application of Trust Money.
Subject to the provisions of Section 8.06, all money deposited with the
Trustee pursuant to Section 13.01 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Agreement, to the payment,
either directly or through any Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Persons entitled thereto,
of the principal (and premium, if any) and interest for whose payment such money
has been deposited with the Trustee; but such money need not be segregated from
other funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 13.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and any Guarantor's obligations under this Agreement and the Notes
shall be revived and reinstated as though no deposit had occurred
96
pursuant to Section 13.01; provided, however, that if the Company has made any
payment of principal of, premium or interest on any Notes because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money or U.S.
Government Obligations held by the Trustee or Paying Agent.
ARTICLE XIV
MISCELLANEOUS
14.01 Trust Indenture Act Controls.
If any provision of this Agreement limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), the imposed duties shall control.
14.02 Notices.
Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company and/or any Guarantor:
AMERCO
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Assistant Treasurer
With a copy to:
Squire, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
Two Renaissance Square
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
97
If to the Trustee:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
The Company, any Guarantor or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mailor by overnight air courier guaranteeing next day delivery to its address
shown on the register kept by the Registrar. Any notice or communication shall
also be so mailed to any Person described in TIA Section 313(c), to the extent
required by the TIA. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee, the Collateral Agent and each Agent at the same
time.
14.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Agreement or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
14.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Agreement, the Company shall furnish to the Trustee:
(a) an Officer's Certificate (which shall include the
statements set forth in Section 14.05 hereof) stating that, in the
opinion of the signers, all conditions precedent and covenants, if any,
provided for in this Agreement relating to the proposed action have
been satisfied; and
(b) an Opinion of Counsel (which shall include the
statements set forth in Section 14.05 hereof) stating that, in the
opinion of such counsel, all such conditions precedent and covenants
have been satisfied.
98
14.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
(a) a statement that the Person making such certificate
or opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he
or she has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such
covenant or condition has been satisfied; and
(d) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been satisfied.
14.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
14.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Guarantor, as such, shall have any liability
for any obligations of the Company or any Guarantor under the Notes, the Note
Guarantees, this Agreement or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes and the Note Guarantees.
14.08 Governing Law.
THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THE COMPANY AND EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS INDENTURE, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT
99
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID
COURTS.
14.09 Waiver of Trial by Jury.
The Company and each Guarantor irrevocably waives, to the fullest
extent it may effectively do so under applicable law, trial by jury and any
objection that it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding brought in any such court and any claim that any
such suit, action or proceeding brought in such court has been brought in an
inconvenient forum.
14.10 Consent to Service of Process.
The Company and each Guarantor irrevocably consents, to the fullest extent it
may effectively do so under applicable law, to the service of process of any of
the courts identified in Section 14.08 in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
the Company and Guarantor at the address set forth herein for the Company, such
service to become effective thirty (30) days after such mailing. Nothing herein
shall affect the right of any holder to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
the Company in any other jurisdiction.
14.11 No Adverse Interpretation of Other Agreements.
This Agreement may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Agreement.
14.12 Successors.
All agreements of the Company in this Agreement and the Notes shall
bind its successors. All agreements of the Trustee in this Agreement shall bind
its successors. All agreements of each Guarantor in this Agreement shall bind
its successors, except as otherwise provided in Sections 10.04 and 10.05.
14.13 Severability.
In case any provision in this Agreement or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
14.14 Counterpart Originals.
The parties may sign any number of copies of this Agreement. Each
signed copy shall be an original, but all of them together represent the same
agreement.
14.15 Table of Contents, Headings, etc.
100
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Agreement have been inserted for convenience of
reference only, are not to be considered a part of this Agreement and shall in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following pages]
101
SIGNATURES
Dated as of March __, 2004
AMERCO
By: _______________________
Name:
Title:
S-1
GUARANTORS:
AMERCO REAL ESTATE COMPANY, a Nevada
corporation
AMERCO REAL ESTATE SERVICES, INC. a
Nevada corporation
AMERCO REAL ESTATE COMPANY OF
ALABAMA, INC., an Alabama corporation
AMERCO REAL ESTATE COMPANY OF
TEXAS, INC. a Texas corporation
ONE PAC COMPANY, a Nevada corporation
TWO PAC COMPANY, a Nevada corporation
THREE PAC COMPANY, a Nevada corporation
FOUR PAC COMPANY, a Nevada corporation
FIVE PAC COMPANY, a Nevada corporation
SIX PAC COMPANY, a Nevada corporation
SEVEN PAC COMPANY, a Nevada corporation
EIGHT PAC COMPANY, a Nevada corporation
NINE PAC COMPANY, a Nevada corporation
TEN PAC COMPANY, a Nevada corporation
ELEVEN PAC COMPANY, a Nevada corporation
TWELVE PAC COMPANY, a Nevada corporation
FOURTEEN PAC COMPANY, a Nevada corporation
FIFTEEN PAC COMPANY, a Nevada corporation
SIXTEEN PAC COMPANY, a Nevada corporation
SEVENTEEN PAC COMPANY, a Nevada corporation
NATIONWIDE COMMERCIAL CO., an Arizona
corporation
PF&F HOLDINGS CORPORATION, a Delaware
corporation
S-2
YONKERS PROPERTY CORPORATION, a New
York corporation
By: ________________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
S-3
EMOVE, INC., a Nevada corporation
WEB TEAM ASSOCIATES, INC. a Nevada
corporation
By: ________________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Secretary
S-4
U-HAUL INSPECTIONS LTD., a British
Columbia corporation
By: ________________________________________
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Secretary
S-5
U-HAUL INTERNATIONAL, INC., a Nevada
corporation
A & M ASSOCIATES, INC., an Arizona
corporation
U-HAUL SELF-STORAGE CORPORATION, a
Nevada corporation
U-HAUL SELF-STORAGE MANAGEMENT
(WPC), INC., a Nevada corporation
U-HAUL BUSINESS CONSULTANTS, INC., an
Arizona corporation
U-HAUL LEASING & SALES CO., a Nevada
corporation
U-HAUL CO. OF ALABAMA, INC., an Alabama
corporation
U-HAUL CO. OF ALASKA, an Alaska corporation
U-HAUL CO. OF ARIZONA, an Arizona
corporation
U-HAUL CO. OF ARKANSAS, an Arkansas
corporation
U-HAUL CO. OF CALIFORNIA, a California
corporation
U-HAUL CO. OF COLORADO, a Colorado
corporation
U-HAUL CO. OF CONNECTICUT, a Connecticut
corporation
U-HAUL CO. OF DISTRICT OF COLUMBIA,
INC., a District of Columbia corporation
U-HAUL CO. OF FLORIDA, a Florida corporation
U-HAUL CO. OF GEORGIA, a Georgia
corporation
U-HAUL OF HAWAII, INC., a Hawaii corporation
U-HAUL CO. OF IDAHO, INC., an Idaho
corporation
U-HAUL CO. OF IOWA, INC., an Iowa
corporation
U-HAUL CO. OF ILLINOIS, INC., an Illinois
corporation
S-6
U-HAUL CO. OF INDIANA, INC., an Indiana
corporation
U-HAUL CO. OF KANSAS, INC., a Kansas
corporation
U-HAUL CO. OF KENTUCKY, a Kentucky
corporation
U-HAUL CO. OF LOUISIANA, a Louisiana
corporation
U-HAUL CO. OF MASSACHUSETTS AND
OHIO, INC., a Massachusetts corporation
U-HAUL CO. OF MARYLAND, INC., a Maryland
corporation
U-HAUL CO. OF MAINE, INC., a Maine
corporation
U-HAUL CO. OF MICHIGAN, a Michigan
corporation
U-HAUL CO. OF MINNESOTA, a Minnesota
corporation
U-HAUL COMPANY OF MISSOURI, a Missouri
corporation
U-HAUL CO. OF MISSISSIPPI, a Mississippi
corporation
U-HAUL CO. OF MONTANA, INC., a Montana
corporation
U-HAUL CO. OF NORTH CAROLINA, a North
Carolina corporation
U-HAUL CO. OF NORTH DAKOTA, a North
Dakota corporation
U-HAUL CO. OF NEBRASKA, a Nebraska
corporation
U-HAUL CO. OF NEVADA, INC., a Nevada
corporation
U-HAUL CO. OF NEW HAMPSHIRE, INC., a
New Hampshire corporation
U-HAUL CO. OF NEW JERSEY, INC. a New
Jersey corporation
U-HAUL CO. OF NEW MEXICO, INC., a New
Mexico corporation
S-7
U-HAUL CO. OF NEW YORK, INC., a New York
corporation
U-HAUL CO. OF OKLAHOMA, INC., an
Oklahoma corporation
U-HAUL CO. OF OREGON, an Oregon
corporation
U-HAUL CO. OF PENNSYLVANIA, a
Pennsylvania corporation
U-HAUL CO. OF RHODE ISLAND, a Rhode
Island corporation
U-HAUL CO. OF SOUTH CAROLINA, INC. a
South Carolina corporation
U-HAUL CO. OF SOUTH DAKOTA, INC., a
South Dakota corporation
U-HAUL CO. OF TENNESSEE, a Tennessee
corporation
U-HAUL CO. OF TEXAS, a Texas corporation
U-HAUL CO. OF UTAH, INC., a Utah corporation
U-HAUL CO. OF VIRGINIA, a Virginia
corporation
U-HAUL CO. OF WASHINGTON, a Washington
corporation
U-HAUL CO. OF WISCONSIN, INC., a Wisconsin
corporation
U-HAUL CO. OF WEST VIRGINIA, a West
Virginia corporation
U-HAUL CO. OF WYOMING, INC., a Wyoming
corporation
U-HAUL CO. (CANADA) LTD. U-HAUL CO.
(CANADA) LTEE, an Ontario corporation
By: ________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Secretary
▇-▇
▇-▇
THE BANK OF NEW YORK, as Trustee
By: ________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
-
S-10
EXHIBIT A
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[FACE OF NOTE]
================================================================================
CUSIP No. [ ]
ISIN No. [ ]
____% Senior Subordinated Secured Notes due 2011
No. ___ $____________
AMERCO
promises to pay to _____________________________________________________________
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on________________, 2011.
Interest Payment Dates: ___________ and ____________
Record Dates: _______________ and _____________
AMERCO
By: _______________________________________
Name:
Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
Dated: _______________, ____
____________________________________, as Trustee
By: __________________________________
Authorized Signatory [BACK OF NOTE]
================================================================================
A-1
[BACK OF NOTE]
____% SENIOR SUBORDINATED SECURED NOTES DUE 2011
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
Interest. AMERCO, a Nevada corporation (the "Company"), promises to pay
interest on the principal amount of this Note at ____% per annum from__________,
2004 until maturity. The Company will pay interest quarterly in arrears on
__________, ___________, ___________ and _______________of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each, an
"Interest Payment Date"). Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be__________, 2004. The Company shall pay
interest on overdue principal and premium, if any, from time to time on demand
at a rate that is 2% per annum in excess of the rate then in effect; it shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (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.
METHOD OF PAYMENT. The Company will pay interest on the Notes (except
defaulted interest) to the Persons who are registered Holders of Notes at the
close of business on the ______________ or _______________ 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 payable
as to principal and interest at the office or agency of the Company maintained
for such purpose within or without the City and State of New York, or, at the
option of the Company, payment of interest may be made by check mailed to the
Holders at their addresses set forth in the register of Holders, and provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest on all Global Notes and all other
Notes the Holders of which shall have provided wire transfer instructions to the
Company or the Paying Agent at least ten Business Days prior to the applicable
payment date. Such payment shall be in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts.
AGENT AND REGISTRAR. Initially, The Bank of New York, the Trustee under
the Indenture, will act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to any Holder. The Company or any
of its Subsidiaries may act in any such capacity.
INDENTURE. The Company issued the Notes under an Indenture dated as
of__________, 2004 ("Indenture") between the Company, the Guarantors listed on
the signature page therein (the "Guarantors") and the Trustee. The terms of the
Notes include those stated in
A-2
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. To the extent any provision of this
Note conflicts with the express provisions of the Indenture, the provisions of
the Indenture shall govern and be controlling. The Notes are obligations of the
Company limited to $_____ million in aggregate principal amount.
OPTIONAL REDEMPTION.
At any time after the Issue Date, the Company shall have the option to redeem
the Notes, in whole or in part, at the redemption prices set forth below, plus
accrued and unpaid interest thereon to the applicable redemption date, if
redeemed during the 12-month period beginning on ______ of the years indicated
below:
Calendar Year Percentage
2004 102.0%
2005 101.5%
2006 101.0%
2007 and thereafter 100.0%
Any such optional redemption shall be made pursuant to the provisions
of Sections 3.01 through 3.06 of the Indenture.
MANDATORY REDEMPTION.
Notwithstanding any provision in the Indenture to the contrary, (i) the
Net Available Proceeds of some or all of the Collateral resulting from one or
more Asset Sales and (ii) an amount equal to 75% of any Net PWC litigation
Recovery in excess of $50.0 million in the aggregate shall be used by the
Company to redeem Notes at a redemption price of 100% of the principal amount of
the Notes so redeemed, plus accrued and unpaid interest thereon to the
applicable redemption date.
Any such mandatory redemption shall be made within 120 days of the
receipt of Net Available Proceeds or Net PWC Litigation Recovery requiring such
redemption, and shall be made pursuant to the provisions of Sections 3.01
through 3.06 of the Indenture.
REPURCHASE AT OPTION OF HOLDER. Upon the occurrence of a Change of
Control, the Company shall be required to make an offer (a "Change of Control
Offer") to each Holder to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each Holder's Notes at a purchase price equal to
101% of the aggregate principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date of purchase (the "Change of Control Payment").
Within 30 days following any Change of Control, the Company shall mail a notice
to each Holder setting forth the procedures governing the Change of Control
Offer as required by the Indenture.
NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Notes are to be
A-3
redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. On and after the redemption date
interest ceases to accrue on Notes or portions thereof called for redemption.
DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the succeeding Interest Payment Date.
PERSONS DEEMED OWNERS. The Holder of a Note may be treated as its owner
for all purposes.
AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the
Indenture, the Note Guarantees or the Notes may be amended or supplemented with
the consent of the Holders of at least a majority in principal amount of the
then outstanding Notes and Additional Notes, if any, voting as a single class,
and any existing default or compliance with any provision of the Indenture, the
Note Guarantees or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes and Additional Notes,
if any, voting as a single class. Without the consent of any Holder of a Note,
the Indenture, the Note Guarantees or the Notes may be amended or supplemented
to cure any ambiguity, defect or inconsistency; to provide for uncertificated
Notes in addition to or in place of certificated Notes or to alter the
provisions of Article II of the Indenture (including the related definitions) in
a manner that does not materially adversely affect any Holder; to provide for
the assumption of the Company's obligations to the Holders of the Notes in the
case of a merger or acquisition by a successor to the Company pursuant to
Article V of the Indenture; to release any Guarantor from any of its obligations
under its Note Guarantee or the Indenture (to the extent permitted by the
Indenture); to make any change that would that does not materially adversely
affect the legal rights hereunder of any Holder of the Notes; or to comply with
requirements of the SEC in order to effect or maintain the qualification of this
Agreement under the Trust Indenture Act.
DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30
days in the payment when due of interest on the Notes; (ii) default in payment
when due of principal of the Notes when the same becomes due and payable at
maturity, upon redemption, upon purchase, upon acceleration or otherwise; (iii)
failure by the Company to comply with any of its agreements or covenants
described under Section 3.08, 4.07, 4.09, 4.10, 4.15 or 5.01 of the Indenture;
(iv) failure by the Company for 30 days after notice to the Company by the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding voting as a single class to comply with certain other
agreements in the Indenture and the Security Documents; (v) default under
certain other agreements relating to an aggregate amount of
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Indebtedness of the Company equal to or exceeding $10 million which default
results in, among other things, the acceleration of such Indebtedness prior to
its express maturity; (vi) certain final judgments for the payment of money in
excess of $10 million in the aggregate that remain undischarged for a period of
60 days; (vii) certain events of bankruptcy or insolvency with respect to the
Company or any of its Significant Subsidiaries; (viii) except as permitted by
the Indenture, any Note Guarantee of a Significant Subsidiary ceases to be in
full force and effect or is declared null and void and unenforceable or is found
to be invalid or any Guarantor denies its liability under such Note Guarantee;
and (ix) events of default under the documents securing the payment of the
Notes. If any Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice. Holders 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) 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, premium or the
principal of, the Notes. The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the Company is
required upon becoming aware of any Default, to deliver to the Trustee a
statement specifying such Default.
TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
No Recourse Against Others. A director, officer, employee, incorporator
or stockholder of the Company or any Guarantor, as such, shall not have any
liability for any obligations of the Company or any Guarantor under the Notes,
the Note Guarantees or the Indenture or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of the Notes and the Guarantees.
AUTHENTICATION. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be
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printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
AMERCO
______________________________________
______________________________________
______________________________________
______________________________________
Attention: ___________________________
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: ______________________
Your Signature: ______________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*: ________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or 4.15 of the Indenture, state the amount you
elect to have purchased:
$_____________________
Date: ______________________
Your Signature: ______________________________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:
Signature Guarantee*: ________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount Signature of
Amount of Amount of [at maturity] of authorized
decrease in increase in this Global Note officer of
Principal Amount Principal Amount following such Trustee or
[at maturity] of [at maturity] of decrease (or Depositary
Date of Exchange this Global Note this Global Note increase) Custodian
---------------- ---------------- ---------------- ---------------- ------------
* This schedule should be included only if the Note is issued in global form.
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EXHIBIT B
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, fully and
unconditionally guaranteed, to the extent set forth in the Indenture (defined
below) and subject to the provisions in the Indenture dated as of____________,
2004 (the "Indenture") among AMERCO, the Guarantors listed on the signature
pages thereto and__________________________, as trustee (the "Trustee"), (a) the
due and punctual payment of the principal of and interest on the Notes (as
defined in the Indenture), whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal and, to
the extent permitted by law, interest, and the due and punctual performance of
all other obligations of the Company to the Holders or the Trustee all in
accordance with the terms of the Indenture and (b) in case of any extension of
time of payment or renewal of any Notes or any of such other obligations, that
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. The obligations of the Guarantors to the Holders of
Notes and to the Trustee pursuant to the Note Guarantee and the Indenture are
expressly set forth in Article X of the Indenture and reference is hereby made
to the Indenture for the precise terms of the Note Guarantee. Each Holder of a
Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that the
Indebtedness evidenced by this Note Guarantee shall cease to be so subordinated
and subject in right of payment upon any defeasance of this Note in accordance
with the provisions of the Indenture.
[Guarantors' Signature Blocks to be Provided]
B-1
EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
Supplemental Indenture (this "Supplemental Indenture"), dated as of
________________, among __________________ (the "Guaranteeing Subsidiary"), a
subsidiary of AMERCO (or its permitted successor), a Nevada corporation (the
"Company"), the Company, the other Guarantors (as defined in the Indenture
referred to herein) and______________________________, as trustee under the
indenture referred to below (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of________________, 2004
providing for the issuance of an aggregate principal amount of up to
$_______________ of ____% Senior Subordinated Secured Notes due 2011 (the
"Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Note Guarantee"); and
WHEREAS, pursuant to Section 4.18 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees as
follows:
(a) Along with all Guarantors named in the Indenture, to jointly
and severally guarantee to each Holder of a Note authenticated and delivered by
the Trustee and to the Trustee and its successors and assigns that:
(i) the principal of and interest on the Notes will be
promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and
interest on the Notes, if any, if lawful, and all other
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obligations of the Company to the Holders or the Trustee under the Indenture and
the Notes will be promptly paid in full or performed, all in accordance with the
terms hereof and thereof; and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that same will
be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. Failing payment when due of any amount so
guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same
immediately.
(b) The obligations hereunder shall be full and unconditional,
irrespective of the validity or enforceability of the Notes or the Indenture,
the absence of any action to enforce the same, any waiver or consent by any
Holder of the Notes with respect to any provisions hereof or thereof, the
recovery of any judgment against the Company, any action to enforce the same or
any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor.
(c) The following is hereby waived: diligence, presentment, demand
of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever.
(d) This Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the Indenture, and the
Guaranteeing Subsidiary accepts all obligations of a Guarantor under the
Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any Custodian, Trustee,
liquidator or other similar official acting in relation to either the Company or
the Guarantors, any amount paid by either to the Trustee or such Holder, this
Note Guarantee, to the extent theretofore discharged, shall be reinstated in
full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the Holders
and the Trustee, on the other hand, (x) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article VI of the Indenture
for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (y) in the event of any declaration of acceleration of
such obligations as provided in Article VI of the Indenture, such obligations
(whether or not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Note Guarantee.
(h) The Guarantors shall have the right to seek contribution from
any non-paying Guarantor so long as the exercise of such right does not impair
the rights of the Holders under the Guarantee.
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(i) Pursuant to Section 10.02 of the Indenture, after giving
effect to any maximum amount and any other contingent and fixed liabilities that
are relevant under any applicable Bankruptcy or fraudulent conveyance laws, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under Article X of the Indenture, this Note
Guarantee shall be limited to the maximum amount permissible such that the
obligations of such Guarantor under this Note Guarantee will not constitute a
fraudulent transfer or conveyance.
EXECUTION AND DELIVERY. The Guaranteeing Subsidiary agrees that this
Note Guarantee shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Note Guarantee.
GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(j) The Guaranteeing Subsidiary may not consolidate with or merge
with or into (whether or not such Guarantor is the surviving Person) another
corporation, Person or entity whether or not affiliated with such Guarantor
unless:
(i) subject to Sections 10.04 and 10.05 of the Indenture,
the Person formed by or surviving any such consolidation or merger (if
other than a Guarantor or the Company) unconditionally assumes all the
obligations of such Guarantor, pursuant to a supplemental indenture in
form and substance reasonably satisfactory to the Trustee, under the
Notes, the Indenture and the Note Guarantee on the terms set forth
herein or therein; and
(ii) immediately after giving effect to such transaction,
no Default or Event of Default exists.
(k) In case of any such consolidation or merger and upon the
assumption by the successor corporation, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of the Indenture to be performed by the Guarantor,
such successor corporation shall succeed to and be substituted for the Guarantor
with the same effect as if it had been named herein as a Guarantor. Such
successor corporation thereupon may cause to be signed any or all of the Note
Guarantees to be endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee. All the Note Guarantees so issued shall in all respects have the same
legal rank and benefit under the Indenture as the Note Guarantees theretofore
and thereafter issued in accordance with the terms of the Indenture as though
all of such Note Guarantees had been issued at the date of the execution hereof.
(l) Except as set forth in Articles IV and V and Section 10.04 of
Article X of the Indenture, and notwithstanding clauses (a) and (b) above,
nothing contained in the Indenture or in any of the Notes shall prevent any
consolidation or merger of a Guarantor with or into the Company or another
Guarantor, or shall prevent any sale or conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Company or
another Guarantor.
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RELEASES.
(m) In the event of a sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the Equity
Interests of any Guarantor then held by the Company and the Restricted
Subsidiaries, or the Company properly designates any Restricted Subsidiary that
is a Guarantor as an Unrestricted Subsidiary or any Guarantor is released from
its Guarantees of Indebtedness of the Company such that such Guarantor would not
be required to provide a Guarantee of the Notes under Section 4.18 of the
Indenture, then such Guarantor (in the event of a sale or other disposition, by
way of merger, consolidation or otherwise, of all of the Equity Interests of
such Guarantor) or the Person acquiring the property (in the event of a sale or
other disposition of all or substantially all of the assets of such Guarantor)
will be released and relieved of any obligations under its Note Guarantee;
provided, however, that the Net Available Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of the
Indenture, to the extent required thereby. Upon delivery by the Company to the
Trustee of an Officer's Certificate and an Opinion of Counsel to the effect that
such sale or other disposition was made by the Company in accordance with the
provisions of the Indenture, the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from its obligations
under its Note Guarantee.
(n) Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under the Indenture
as provided in Article X of the Indenture.
NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the Company
or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the
Indenture or this Supplemental Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of the
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes and the Note
Guarantees. Such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the Securities and Exchange
Commission that such a waiver is against public policy.
NEW YORK LAW TO GOVERN. THIS SUPPLEMENTAL INDENTURE WILL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the
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recitals contained herein, all of which recitals are made solely by the
Guaranteeing Subsidiary and the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, ____
[GUARANTEEING SUBSIDIARY]
By: _______________________________
Name:
Title:
[Guarantors' Signature Blocks to be Provided]
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SCHEDULE G
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Issue Date:
[List of Guarantors to be Provided]
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