Exhibit 4.6
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ADVANTICA RESTAURANT GROUP, INC.
AND
▇▇▇▇▇'▇ HOLDINGS, INC.,
AS ISSUERS
AND
U.S. BANK NATIONAL ASSOCIATION,
AS TRUSTEE
INDENTURE
DATED AS OF __________, 2002
-------------------------
$___________
12 3/4% SENIOR NOTES DUE 2007
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TABLE OF CONTENTS
Page
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PARTIES.......................................................................1
RECITALS
Authorization Of Indenture...........................................1
Form Of Face Of Security.............................................1
Form Of Reverse Of Security..........................................3
Form Of Trustee's Certificate Of Authentication......................7
Compliance With Legal Requirements...................................7
Purpose Of And Consideration For Indenture...........................7
ARTICLE ONE DEFINITIONS................................................12
SECTION 1.1 Certain Terms Defined......................................12
ARTICLE TWO ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES......25
SECTION 2.1 Authentication and Delivery of Securities..................25
SECTION 2.2 Execution of Securities....................................25
SECTION 2.3 Certificate of Authentication..............................26
SECTION 2.4 Form, Denomination and Date of Securities; Payments
of Interest................................................26
SECTION 2.5 Registration, Transfer and Exchange........................26
SECTION 2.6 Mutilated, Defaced, Destroyed, Lost and Stolen
Securities.................................................39
SECTION 2.7 Cancellation of Securities; Destruction Thereof............40
SECTION 2.8 Temporary Securities.......................................40
SECTION 2.9 Issuance of Additional Securities..........................40
ARTICLE THREE COVENANTS OF THE ISSUERS AND THE TRUSTEE...................40
SECTION 3.1 Payment of Principal and Interest..........................40
SECTION 3.2 Offices for Payments, etc..................................41
SECTION 3.3 Appointment to Fill a Vacancy in Office of Trustee.........41
SECTION 3.4 Paying Agents..............................................41
SECTION 3.5 Certificates to Trustee....................................41
SECTION 3.6 Securityholder Lists.......................................42
SECTION 3.7 Reports by the Issuers.....................................42
SECTION 3.8 Reports by the Trustee.....................................42
SECTION 3.9 Limitation on Restricted Payments..........................42
SECTION 3.10 Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries........................45
SECTION 3.11 Limitation on Additional Indebtedness and Issuance
of Disqualified Stock......................................46
SECTION 3.12 Limitation on Transactions with Affiliates.................47
SECTION 3.13 Limitation on Sale of Assets...............................48
SECTION 3.14 Corporate Existence........................................49
SECTION 3.15 Limitation on Liens........................................50
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SECTION 3.16 Future Subsidiary Guarantors...............................51
SECTION 3.17 Investments in Unrestricted Subsidiaries...................52
SECTION 3.18 Offer to Redeem upon Change of Control.....................52
ARTICLE FOUR REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON
EVENT OF DEFAULT...........................................53
SECTION 4.1 Events of Default..........................................53
SECTION 4.2 Acceleration...............................................55
SECTION 4.3 Other Remedies.............................................56
SECTION 4.4 Waiver of Defaults.........................................56
SECTION 4.5 Control by Majority........................................56
SECTION 4.6 Limitation on Suits........................................56
SECTION 4.7 Rights of Holders to Receive Payment.......................57
SECTION 4.8 Collection Suit by Trustee.................................57
SECTION 4.9 Trustee May File Proofs of Claim...........................57
SECTION 4.10 Priorities.................................................57
SECTION 4.11 Undertaking for Costs......................................58
ARTICLE FIVE CONCERNING THE TRUSTEE.....................................58
SECTION 5.1 Duties and Responsibilities of the Trustee; During
Default; Prior to Default..................................58
SECTION 5.2 Certain Rights of the Trustee..............................59
SECTION 5.3 Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof..............60
SECTION 5.4 Trustee and Agents May Hold Securities;
Collections, etc...........................................60
SECTION 5.5 Moneys Held by Trustee.....................................60
SECTION 5.6 Compensation and Indemnification of Trustee and Its
Prior Claim................................................60
SECTION 5.7 Right of Trustee to Rely on Officers' Certificates,
etc........................................................61
SECTION 5.8 Persons Eligible for Appointment as Trustee................61
SECTION 5.9 Resignation and Removal; Appointment of Successor
Trustee....................................................61
SECTION 5.10 Acceptance of Appointment by Successor Trustee.............62
SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business of Trustee........................................62
SECTION 5.12 Notice of Default..........................................63
ARTICLE SIX CONCERNING THE SECURITYHOLDERS.............................63
SECTION 6.1 Evidence of Action Taken by Securityholders................63
SECTION 6.2 Proof of Execution of Instruments and of Holding of
Securities; Record Date....................................63
SECTION 6.3 Holders to Be Treated as Owners............................63
SECTION 6.4 Securities Owned by Issuers Deemed Not Outstanding.........64
SECTION 6.5 Right of Revocation of Action Taken........................64
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ARTICLE SEVEN SUPPLEMENTAL INDENTURES....................................64
SECTION 7.1 Supplemental Indentures Without Consent of
Securityholders............................................64
SECTION 7.2 Supplemental Indentures With Consent of
Securityholders............................................65
SECTION 7.3 Effect of Supplemental Indenture...........................66
SECTION 7.4 Documents to Be Given to Trustee...........................66
SECTION 7.5 Notation on Securities in Respect of Supplemental
Indentures.................................................66
ARTICLE EIGHT CONSOLIDATION, MERGER, SALE OR CONVEYANCE..................67
SECTION 8.1 When Issuer May Merge, etc.................................67
SECTION 8.2 Successor Corporation Substituted..........................67
ARTICLE NINE SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED
MONEYS; DEFEASANCE.........................................68
SECTION 9.1 Satisfaction and Discharge of Indenture....................68
SECTION 9.2 Application by Trustee of Funds Deposited for
Payment of Securities......................................68
SECTION 9.3 Repayment of Moneys Held by Paying Agent...................68
SECTION 9.4 Return of Moneys Held by Trustee and Paying Agent
Unclaimed for Three Years..................................68
SECTION 9.5 Defeasance.................................................69
ARTICLE TEN MISCELLANEOUS PROVISIONS...................................70
SECTION 10.1 Stockholders, Officers and Directors of Issuers
Exempt from Individual Liability...........................70
SECTION 10.2 Provisions of Indenture for the Sole Benefit of
Parties and Securityholders................................70
SECTION 10.3 Successors and Assigns of Issuers Bound by
Indenture..................................................70
SECTION 10.4 Notices and Demands on Issuers, Trustee and
Securityholders............................................70
SECTION 10.5 Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein.........................71
SECTION 10.6 Payments Due on Saturdays, Sundays and Holidays............72
SECTION 10.7 Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939......................................72
SECTION 10.8 New York Law to Govern.....................................72
SECTION 10.9 Counterparts...............................................72
SECTION 10.10 Effect of Headings.........................................72
ARTICLE ELEVEN REDEMPTION OF SECURITIES...................................72
SECTION 11.1 Right of Optional Redemption...............................72
SECTION 11.2 Notice of Redemption; Partial Redemptions..................72
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SECTION 11.3 Payment of Securities called for Redemption................73
SECTION 11.4 Exclusion of Certain Securities from Eligibility for
Selection for Redemption...................................74
SECTION 11.5 Offer to Repurchase by Application of Net Proceeds.........74
SECTION 11.6 Provisions Governing Repurchase Pursuant to
Change of Control Offer....................................74
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THIS INDENTURE, dated as of ____________, 2002, among Advantica
Restaurant Group, Inc., a Delaware corporation ("Advantica"), and ▇▇▇▇▇'▇
Holdings, Inc., a New York corporation ("Denny's Holdings," and together with
Advantica, the "Issuers"), and U.S. Bank National Association, as Trustee (the
"Trustee"),
W I T N E S S E T H:
WHEREAS, the Issuers have duly authorized the issue of their 12 3/4%
Senior Notes Due 2007 (the "Securities") and, to provide, among other things,
for the authentication, delivery and administration thereof, the Issuers have
duly authorized the execution and delivery of this Indenture; and
WHEREAS, the Securities and the Trustee's certificate of authentication
shall be in substantially the following form:
[FORM OF FACE OF SECURITY]
No. ___________ $_______________
ADVANTICA RESTAURANT GROUP, INC.
AND
▇▇▇▇▇'▇ HOLDINGS, INC.
12 3/4% Senior Notes Due 2007(1)
Advantica Restaurant Group, Inc., a Delaware corporation ("Advantica"),
and ▇▇▇▇▇'▇ Holdings, Inc., a New York corporation ("Denny's Holdings," and
together with Advantica, the "Issuers"), for value received hereby promise to
pay to _________________________ or registered assigns the principal sum of
______________ Dollars at the Issuers' office or agency for said purpose on
September 30, 2007 in such coin or currency of the United States of America as
at the time of payment shall be legal tender for the payment of public and
private debts, and to pay interest, semi-annually, on March 31 and September 30
of each year, commencing on March 31, 2002, on said principal sum in like coin
or currency at the rate per annum set forth above at said office or agency from
the March 31 or the September 30, as the case may be, next preceding the date of
this Security to which interest on the Securities has been paid or duly provided
for, unless the date hereof is a date to which interest on the Securities has
been paid or duly provided for, in which case from the date of this Security, or
unless no interest has been paid or duly provided for on the Securities, in
which case from _________, 2002, until payment of said principal sum has been
made or duly provided for. Notwithstanding the foregoing, if the date hereof is
after March 15 or September 15, as the case may be, and before the following
March 31 or September 30, this Security shall bear interest from such March 31
or September 30; provided that, if the Issuers shall default in the payment of
interest due on such March 31 or September 30, then this Security shall bear
interest from the next preceding March 31 or September 30 to which interest on
the Securities has been paid or duly provided for, or, if no interest has been
paid or duly provided for on the Securities, from __________, 2002. The interest
so payable on any March 31 or September 30 will, except as otherwise provided in
the Indenture referred to on the reverse hereof, be paid to the person in whose
name this Security is registered at the close of business on the March 15 or
September 15 next preceding such March 31 or
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(1) Modify as appropriate to include series reference for Additional Securities
and Exchange Securities.
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September 30, whether or not such day is a business day; provided that interest
may be paid, at the option of the Issuers, by mailing a check therefor payable
to the registered holder entitled thereto at his last address as it appears on
the Security register or by wire transfer to such holder.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Security shall not be valid or obligatory until the certificate of
authentication hereof, shall have been duly signed by the Trustee acting under
the Indenture.
IN WITNESS WHEREOF, each of the Issuers has caused this instrument to
be duly executed under its corporate seal.
DATED:
[SEAL] ADVANTICA RESTAURANT GROUP, INC.,
a Delaware corporation
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
[SEAL] ▇▇▇▇▇'▇ HOLDINGS, INC.,
a New York corporation
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-mentioned
Indenture.
U.S. Bank National Association, as Trustee
------------------------------------------
Authorized Signatory
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[FORM OF REVERSE OF SECURITY]
ADVANTICA RESTAURANT GROUP, INC.
AND
▇▇▇▇▇'▇ HOLDINGS, INC.
12 3/4% Senior Notes Due 2007(2)
[THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF
THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.5 OF THE INDENTURE, (2) THIS GLOBAL SECURITY
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.5(a) OF THE
INDENTURE, (3) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.7 OF THE INDENTURE AND (4) THIS GLOBAL
SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE ISSUERS.](3)
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"),
TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.](4)
[THE RIGHTS ATTACHING TO THIS REG S TEMPORARY GLOBAL SECURITY AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE SECURITIES, ARE
AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REG S TEMPORARY GLOBAL SECURITY SHALL BE ENTITLED TO
RECEIVE CASH PAYMENTS OF INTEREST DURING THE PERIOD WHICH SUCH HOLDER HOLDS THIS
SECURITY. NOTHING IN THIS LEGEND SHALL BE DEEMED TO PREVENT INTEREST FROM
ACCRUING ON THIS SECURITY.](5)
[THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
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(2) Modify as appropriate to include series reference for Additional Securities
and Exchange Securities.
(3) To be included only on Global Securities deposited with DTC as Depositary.
(4) To be included only on Global Securities deposited with DTC as Depositary.
(5) To be included only on Reg S Temporary Global Securities.
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REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
PRIOR TO THE DATE WHICH IS TWO YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE
PROVIDED UNDER RULE 144(k) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF
RESTRICTED SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR ANY
AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO AN
ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS SECURITY IS ELIGIBLE
FOR RESALE PURSUANT TO RULE ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE
SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7)
OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE ISSUERS' AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND IN EACH
OF THE FOREGOING CASES A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE
INDENTURE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND IN
EACH CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY U.S. STATE OR ANY
OTHER APPLICABLE JURISDICTION. THE HOLDER OF THIS SECURITY AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.](6)
This Security is one of a duly authorized issue of debt securities of
each Issuer, limited to the aggregate principal amount of $254,050,000 (except
as otherwise provided in the Indenture mentioned below), issued or to be issued
pursuant to an indenture dated as of ___________, 2002 (the "Indenture"), duly
executed and delivered by the Issuers to U.S. Bank National Association, as
Trustee (herein called the "Trustee"); provided, that Securities issued on the
Original Issue Date shall not exceed $204,050,000 in aggregate principal amount
and Securities issued thereafter (other than pursuant to an Exchange Offer or
otherwise in exchange for or in replacement of outstanding Securities) shall
not exceed $50,000,000 in aggregate principal amount. Reference is hereby
made to the Indenture and all indentures supplemental thereto for a description
of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Issuers and the holders (the words "holders" or
"holder" meaning the registered
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(6) To be included only on Transfer Restricted Securities.
5
holders or registered holder) of the Securities. Defined terms used without
definition herein shall have the meanings ascribed to them in the Indenture.
If an Event of Default, other than in respect of certain events of
bankruptcy or insolvency as set forth in the Indenture, shall have occurred and
be continuing, the Trustee or the holders of at least 30% (or 25% in the case of
an Event of Default with respect to payment of principal of, premium, if any, or
interest on, the Securities) in aggregate principal amount of the Securities
then outstanding may declare in writing 100% of the unpaid principal amount of,
and any accrued and unpaid interest on, the Securities to be due and payable
immediately; provided, however, that if any Senior Indebtedness is outstanding
pursuant to the Credit Agreement, then all the Securities shall be due and
payable upon the earlier of (x) the day that is five Business Days after the
provision to the Issuers and the Credit Agent of such written notice of
acceleration unless such Event of Default has been cured or waived prior to such
date and (y) the date of acceleration of any Senior Indebtedness under the
Credit Agreement. Upon an Event of Default arising from certain events of
bankruptcy or insolvency as described in the Indenture, the unpaid principal of
and any accrued and unpaid interest on all the Securities will become
immediately due and payable without further action or notice. The Indenture
provides that in certain events a declaration of acceleration and its
consequences resulting from a default under certain other Indebtedness of an
Issuer or its Subsidiaries may be automatically annulled and that the holders of
a majority in aggregate principal amount of the Securities then outstanding may,
on behalf of the holders of all of the Securities, waive any past Default or
Event of Default under the Indenture and its consequences, except a continuing
Default or Event of Default in the payment of principal of, premium, if any, or
interest on any of the Securities. Any such consent or waiver by the holder of
this Security (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such holder and upon all future holders and owners of this
Security and any Security which may be issued in exchange or substitution
herefor, whether or not any notation thereof is made upon this Security or such
other Securities.
The Indenture permits the Issuers and the Trustee, with the consent of
the holders of not less than a majority in aggregate principal amount of the
Securities at the time outstanding, evidenced as in the Indenture provided, to
enter into supplemental indentures adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or modifying in any manner the rights of the holders of
the Securities; provided that no such supplemental indenture shall (a) extend
the final maturity of any Security, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon, or reduce the
premium, if any, payable thereon, or reduce any amount payable on the redemption
thereof, or impair or affect the right of any holder to institute suit for the
payment thereof, or waive a default in the payment of principal of, premium, if
any, or interest on any Security, change the currency of payment of principal
of, premium, if any, or interest on any Security, or modify any provision in the
Indenture with respect to the priority of the Securities in right of payment
without the consent of the holder of each Security so affected, or (b) reduce
the aforesaid percentage of Securities, the consent of the holders of which is
required for any such supplemental indenture, without the consent of the holders
of each Security then outstanding.
The Securities are senior unsecured obligations of the Issuers and will
rank pari passu in right of payment to all Senior Indebtedness of the Issuers.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Issuers, which
is absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Security at the place, times, and rate, and in the currency,
herein prescribed.
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The Securities are issuable only as registered Securities without
coupons in denominations of $1,000 and any multiple of $1,000.
At the office or agency of the Issuers referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Issuers, a new Security or
Securities of authorized denominations, for a like aggregate principal amount,
will be issued to the transferee as provided in the Indenture. Securities may be
presented for registration of transfer in part only in multiples of $1,000. No
service charge shall be made for any such transfer, but the Issuers may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto.
Except as provided below, the Securities may not be redeemed, either in
whole or in part, at the option of the Issuers prior to September 30, 2004. On
and after September 30, 2004, the Securities will be redeemable, in whole or in
part, at the option of the Issuers, at the redemption prices (expressed as
percentages of the principal amount) set forth below, plus accrued and unpaid
interest, if any, to the redemption date, if redeemed during the 12-month period
beginning September 30 of the years indicated below:
YEAR PERCENTAGE
2004 ..................... 106.3750%
2005 ..................... 103.1875%
2006 and thereafter ..................... 100.0000%
provided that, if the dated fixed for redemption is on March 31, or September
30, then the interest payable on such date shall be paid to the holder of record
on the March 15 or September 15 next preceding such March 31 or September 30.
Notwithstanding the foregoing, prior to September 30, 2004, the Issuers
may redeem up to 35% of the aggregate principal amount of Securities outstanding
on the date of the Indenture at a redemption price (expressed as a percentage of
the principal amount) of 112.75%, plus accrued and unpaid interest, if any, to
the redemption date, from the net proceeds of any Public Offering.
Notice of redemption shall be mailed at least 30 and not more than 60
days prior to the date fixed for redemption to each holder of Securities to be
redeemed at its last registered address. Securities may be redeemed in part only
in multiples of $1,000.
Subject to the terms of the Indenture, if an Issuer consummates an
Asset Sale or sells, leases, conveys or otherwise disposes of a Business
Segment, such Issuer shall be obligated to apply the Net Proceeds thereof to one
or more of the following in such combination as such Issuer may choose: (i) an
Investment in another asset or business in the same line of business as, or a
line of business similar to that of, the line of business of Advantica and its
Subsidiaries (other than in the case of any Asset Sale of an Asset Segment in
any of the Denny's Holdings Group or any sale, lease, conveyance or other
disposition of any Business Segment in any of the Denny's Holdings Group, any
Investment by any of the Denny's Holdings Group in any of the Advantica Group)
and such Investment occurs within 366 days of such Asset Sale or such sale,
lease, conveyance or other disposition of a Business Segment, (ii) an offer,
expiring within 366 days of such Asset Sale or such sale, lease, conveyance or
other disposition of a Business Segment, to repurchase Securities at a price not
less than 100% of the principal amount thereof,
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plus accrued and unpaid interest, if any, to the redemption date (a "Net
Proceeds Offer") or (iii) the purchase, redemption or other prepayment or
repayment of outstanding Senior Indebtedness within 366 days of such Asset Sale
or such sale, lease, conveyance or other disposition of a Business Segment,
provided, that any amounts used to repay Indebtedness outstanding under the Old
Notes shall be applied only as and when permitted by the Indenture; provided,
however, that if the net amount not invested pursuant to clause (i) above or
applied pursuant to clause (iii) above is less than $15,000,000, such Issuer
shall not be further obligated to offer to repurchase Securities pursuant to
clause (ii) above. Holders of Securities that are the subject of an offer to
repurchase shall receive an offer to repurchase from the Issuers prior to any
related repurchase date, and may elect to have such Securities repurchased by
completing the form entitled "Option of Holder to Elect to Have Security
Repurchased" appearing below. Notwithstanding any provision of the Indenture to
the contrary, the Issuer that originally received the Net Proceeds may, for a
period of 120 days after the last date on which holders of Securities are
permitted to tender their Securities in a Net Proceeds Offer, use any Net
Proceeds that were available to make such Net Proceeds Offer but not used to
repurchase Securities pursuant thereto, to purchase, redeem or otherwise acquire
or retire for value securities of such Issuer ranking junior in right of payment
to the Securities at a price, stated as a percentage of the principal or face
amount of such junior securities, not greater than the price, stated as a
percentage of the principal amount of the Securities, offered in the Net
Proceeds Offer; provided that, if the Net Proceeds Offer is for a principal
amount (the "Net Proceeds Offer Amount") of the Securities less than the
aggregate principal amount of the Securities then outstanding, then the Net
Proceeds available for use by such Issuer for such a purchase, redemption or
other acquisition or retirement for value of junior securities shall not exceed
the Net Proceeds Offer Amount.
Subject to payment by the Issuers (by deposit with the Trustee or
otherwise) of a sum sufficient to pay the amount due on redemption, interest on
this Security (or portion hereof if this Security is redeemed or repurchased in
part) shall cease to accrue upon the date duly fixed for redemption or
repurchase of this Security (or portion hereof if this Security is redeemed or
repurchased in part), and all rights of the holder with respect to such redeemed
Security (or portion thereof if this Security is redeemed or repurchased in
part) hereunder or under the Indenture, except the right to payment of amounts
payable on such redemption or repurchase, shall cease.
The Issuers, the Trustee, and any authorized agent of the Issuers or
the Trustee, may deem and treat the registered holder hereof as the absolute
owner of this Security (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by anyone
other than the Issuers or the Trustee or any authorized agent of the Issuers or
the Trustee), for the purpose of receiving payment of, or on account of, the
principal hereof and premium, if any, and, subject to the provisions on the face
hereof, interest hereon and for all other purposes, and neither the Issuers nor
the Trustee nor any authorized agent of the Issuers or the Trustee shall be
affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of, premium,
if any, or interest on this Security, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, stockholder, officer or
director, as such, past, present or future, of either Issuer or of any successor
corporation, either directly or through such Issuer or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released. Nothing in this provision limits the
liability, if any, of any such incorporator, officer, director or shareholder,
as such, under the federal securities laws.
8
In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Transfer Restricted Securities shall have all the rights
set forth in the applicable Registration Rights Agreement.(7)
--------
(7) To be included only on Transfer Restricted Securities.
9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL SECURITY(8)
The following exchanges of a part of this Global Security for an
interest in another Global Security or for a Definitive Security, or exchanges
of a part of another Global Security or Definitive Security for an interest in
this Global Security, have been made:
Principal Amount of
this Global Security Signature of
Amount of decrease in Amount of increase in following such authorized officer of
Principal Amount of Principal Amount of decrease Trustee or Security
Date of Exchange this Global Security this Global Security (or increase) Custodian
---------------- -------------------- -------------------- ------------- ---------
--------
(8) This should be included only if the Security is issued in global form.
10
OPTION OF HOLDER TO ELECT TO HAVE SECURITY REPURCHASED
If you have received a Net Proceeds Offer from the Issuers and want to
elect to have this Security repurchased by the Issuers pursuant to Section 11.5
of the Indenture, check the box: [ ]
If you have received a Change of Control Offer from the Issuers and
want to elect to have this Security repurchased by the Issuers pursuant to
Section 3.18 of the Indenture, check the box [ ]
If you want to elect to have any part of this Security repurchased by
the Issuers pursuant to Section 3.18 of the Indenture, state the amount:
$________________________
Date: ___________________ Your Signature: __________________________________
(Sign exactly as your name appears
on the other side of this Security)
Signature Guarantee: _______________
AND WHEREAS, all things necessary to make the Securities, when executed
by the Issuers and authenticated and delivered by the Trustee as in this
Indenture provided, the valid, binding and legal obligations of the Issuers, and
to constitute these presents a valid indenture and agreement according to its
terms, have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the Securities by
the holders thereof, the Issuers and the Trustee mutually covenant and agree for
the equal and proportionate benefit of the respective holders from time to time
of the Securities as follows:
11
ARTICLE ONE
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture which are defined in the Trust Indenture Act of 1939 or
the definitions of which in the Securities Act are referred to in the Trust
Indenture Act of 1939 (except as herein otherwise expressly provided or unless
the context otherwise clearly requires), shall have the meanings assigned to
such terms in said Trust Indenture Act and in said Securities Act as in force at
the date of this Indenture. All accounting terms used herein and not expressly
defined shall have the meanings given to them in accordance with generally
accepted accounting principles, and the term "generally accepted accounting
principles" shall mean such accounting principles which are generally accepted
at the date or time of any computation or at the date hereof. The words
"herein," "hereto" and "hereunder" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other
subdivision. References to Sections or Articles mean reference to such Section
or Article in this Indenture, unless otherwise stated. The terms defined in this
Article include the plural as well as the singular.
"144A Global Security" means one or more Global Securities bearing the
Private Placement Legend that will be issued in an aggregate amount of
denominations equal in total to the outstanding principal amount of the
Securities sold in reliance under Rule 144A.
"501 Global Security" means one or more Global Securities bearing the
Private Placement Legend that will be issued in an aggregate amount of
denominations equal in total to the outstanding principal amount of the
Securities sold to institutional "accredited investors" within the meaning of
Rule 501(a)(1), (2), (3), or (7) of the Securities Act.
"Acquisition Indebtedness" means Indebtedness of any person existing at
the time such person becomes a Subsidiary of an Issuer (or at the time such
person is merged with or into a Subsidiary of an Issuer), excluding Indebtedness
of any Subsidiary of an Issuer incurred in connection with, or in contemplation
of, such person becoming a Subsidiary of such Issuer.
"Additional Securities" means the 12 3/4% Senior Notes Due 2007
authenticated and delivered hereunder that may be issued pursuant to this
Indenture after the Original Issue Date (other than pursuant to an Exchange
Offer or otherwise in exchange for or in replacement of outstanding Securities)
which shall not exceed $50,000,000 in aggregate principal amount.
"Adjusted Consolidated Net Worth" means, with respect to any person as
of any date, the Consolidated Net Worth of such person plus (i) the respective
amounts reported on such person's most recent consolidated balance sheet with
respect to any Preferred Stock (other than Disqualified Stock) that by its terms
is not entitled to the payment of dividends unless such dividends may be
declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
person upon issuance of such Preferred Stock or of securities converted into
such Preferred Stock, excluding (ii) any amount reflecting any equity adjustment
resulting from a foreign currency translation on a consolidated balance sheet of
such person, but only to the extent not excluded in calculating Consolidated Net
Worth of such person, plus (iii) any gain realized upon the sale or other
disposition, of any Business Segment to the extent such gains do not exceed the
sum of the aggregate amount of any losses included (on a net after tax basis) in
the computation of Consolidated Net Worth.
12
"Advantica" means the entity identified as "Advantica" in the first
paragraph hereof until a successor replaces it pursuant to this Indenture, and
thereafter means such successor.
"Advantica Group" means Advantica and any Subsidiary of Advantica,
other than Denny's Holdings or any Subsidiary of Denny's Holdings.
"Affiliate" means, with respect to any person, any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such person. For the purposes of this definition, beneficial
ownership of 10% or more of the voting common equity of a person shall be deemed
to be control unless ownership of a lesser amount may be deemed to be control
under the Trust Indenture Act.
"Agent" means any Registrar, paying agent or co-registrar for the
Securities.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Security, the rules and procedures
of the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange at the relevant time.
"Asset Segment" means (i) Denny's Holdings, or (ii) any Subsidiary,
group of Subsidiaries or group of assets (other than inventory held for sale in
the ordinary course of business) of an Issuer or its Subsidiaries which (A)
accounts for at least 20 percent of the total assets of such Issuer and its
Subsidiaries on a consolidated basis as of the end of the last fiscal quarter
immediately preceding the date for which such determination is being made or (B)
accounts for at least 20 percent of the income from continuing operations before
income taxes, extraordinary items and cumulative effects of changes in
accounting principles of such Issuer and its Subsidiaries on a consolidated
basis for the four full fiscal quarters immediately preceding the date for which
such calculation is being made.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board of Directors" means either the Board of Directors of an Issuer,
as indicated, or any committee of such Board duly authorized to act hereunder.
"Broker-Dealer" means any broker-dealer that receives Exchange
Securities for its own account in the Exchange Offer in exchange for Securities
that were acquired by such broker-dealer as a result of market-making or other
trading activities.
"Business Day" means a day which, in the city (or in any of the cities
if more than one) where amounts are payable in respect of the Securities as
specified on the face of the form of Security recited above, is neither a legal
holiday nor a day on which banking institutions are authorized by law or
regulation to close.
"Business Segment" means (i) each Significant Subsidiary of an Issuer,
(ii) the Equity Interests of any of an Issuer's Subsidiaries or (iii) any group
of assets of an Issuer or any of its Subsidiaries, whether now owned or
hereafter acquired; provided, in each case, that the sale (other than the sale
of inventory in the ordinary course of business), lease, conveyance or other
disposition of such Significant Subsidiary, Equity Interest or group of assets,
as the case may be either in a single transaction or group of related
transactions that are part of a common plan, results in Net Proceeds to such
Issuer or any of its Subsidiaries of $50 million or more.
13
"Capital Stock" means any and all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock.
"Cash Equivalents" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit with a maturity date not more than one year from the
date of acquisition issued by any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or a commercial
bank organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development and having total assets in
excess of $500,000,000, (iii) repurchase obligations with a term of not more
than 7 days for underlying securities of the types described in clause (i) above
entered into with any bank meeting the qualifications specified in clause (ii)
above, (iv) commercial paper issued by the parent corporation of any domestic
commercial bank of recognized standing having capital and surplus in excess of
$500,000,000 and commercial paper issued by others rated at least A-2 or the
equivalent thereof by Standard & Poor's Corporation or at least P-2 or the
equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc. and in each case maturing
within one year after the date of acquisition and (v) investments in money
market funds substantially all of whose assets comprise securities of the types
described in clauses (i) through (iv) above.
"Clearstream" means Clearstream Banking S.A., or its successors, as
operators of the Clearstream system.
"Code" means the Internal Revenue Code of 1986, as it may be amended
from time to time.
"Commission" means the Securities and Exchange Commission.
"Consolidated Fixed Charges" means, with respect to any person for a
given period, (i) consolidated interest expense of such person and its
consolidated Subsidiaries to the extent deducted in computing Consolidated Net
Income of such person (including, without limitation, amortization of original
issue discount and non-cash interest payments, all net payments and receipts in
respect of Interest Rate Agreements and the interest component of capital
leases, but excluding deferred financing costs existing immediately after the
date hereof and the amortization thereof) plus (ii) the amount of all cash
dividend payments on any series of Preferred Stock of such person; provided that
if, during such period (1) such person or any of its Subsidiaries shall have
made any asset sales (other than, in the case of an Issuer and its Subsidiaries,
sales of the Capital Stock of, or any assets of, Unrestricted Subsidiaries),
Consolidated Fixed Charges of such person and its Subsidiaries for such period
shall be reduced by an amount equal to the Consolidated Fixed Charges directly
attributable to the assets which are the subject of such asset sales for such
period and (2) such person or any of its Subsidiaries has made any acquisition
of assets or Capital Stock (occurring by merger or otherwise), including,
without limitation, any acquisition of assets or Capital Stock occurring in
connection with the transaction causing a calculation to be made hereunder,
Consolidated Fixed Charges of such person and its Subsidiaries shall be
calculated on a pro forma basis as if such acquisition of assets or Capital
Stock (including the incurrence of any Indebtedness in connection with any such
acquisition and the application of the proceeds thereof) took place on the first
day of such period.
"Consolidated Net Income" means, with respect to any person for a given
period, the aggregate of the Net Income of that person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with generally
accepted accounting principles; provided that (i) the Net Income of any person
that is not a Subsidiary of that person or is accounted for by the equity method
of accounting shall be included only to the extent of the amount of dividends or
distributions paid to that person and its
14
Subsidiaries, (ii) the Net Income of any person that is a Subsidiary (other than
a Subsidiary of which at least 80% of the Capital Stock having ordinary voting
power for the election of directors or other governing body of such Subsidiary
is owned by that person directly or indirectly through one or more Subsidiaries)
shall be included only to the extent of the lesser of (a) the amount of
dividends or distributions paid to that person and its Subsidiaries and (b) the
Net Income of such person, (iii) the Net Income of any person acquired by that
person and its Subsidiaries in a pooling of interests transaction for any period
prior to the date of such acquisition shall be excluded and (iv) with respect to
an Issuer, the Net Income (if positive) of any person that becomes a Subsidiary
of such Issuer after the date hereof shall be included only to the extent that
the declaration or payment of dividends on Capital Stock or any similar
distributions, by that Subsidiary to such Issuer or to any other consolidated
Subsidiary of such Issuer, of such Net Income is at the time permitted under the
terms of its charter and all agreements, instruments, judgments, decrees,
orders, statutes, rules and governmental regulations binding upon or applicable
to that Subsidiary; provided that, if the exclusion from an otherwise positive
Net Income of certain amounts pursuant to this clause (iv) would cause such Net
Income to be negative, then such Net Income shall be deemed to be zero.
"Consolidated Net Worth" means, with respect to any person at any date
of determination, the sum of the Capital Stock and additional paid-in capital
plus retained earnings (or minus accumulated deficit) of such person and its
Subsidiaries on a consolidated basis, each item to be determined in conformity
with generally accepted accounting principles (excluding the effects of foreign
currency exchange adjustments under Financial Accounting Standards Board
Statement of Financial Accounting Standards No. 52), except that all effects of
the application of Accounting Principles Board Opinions Nos. 16 and 17 and
related interpretations shall be disregarded.
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is dated, located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇.
"Credit Agent" means any person acting as managing agent (or in a
similar capacity) under the Credit Agreement, or any successor thereto; provided
that "Credit Agent" shall also mean any person acting as managing agent (or in a
similar capacity) under any agreement pursuant to which the Credit Agreement is
refunded or refinanced if such person is designated as such by each person that
is at the time of such designation a Credit Agent; and provided further that if
at any time there shall be more than one Credit Agent, then "Credit Agent" shall
mean each such Credit Agent, and any notice, consent or waiver to be given by,
action to be taken by, or notice to be given to, the Credit Agent shall be given
or taken by, or given to, each such Credit Agent.
"Credit Agreement" means the Credit Agreement dated as of January 7,
1998, among Denny's, Inc., El Pollo Loco, Inc., Flagstar Enterprises, Inc.,
Flagstar Systems, Inc. and Quincy's Restaurants, Inc., as borrowers, Advantica
as a guarantor, the lenders named therein, and The Chase Manhattan Bank, as
administrative agent, as amended through and including the date hereof,
including any and all related notes, collateral and security documents,
instruments and agreements executed in connection therewith (including, without
limitation, all Loan Documents (as defined in such Credit Agreement)) and all
obligations of Advantica and its Subsidiaries incurred thereunder or in respect
thereof, and in each case as amended, supplemented, restructured or otherwise
modified, extended or renewed and each other agreement pursuant to which any or
all of the foregoing may be refunded or refinanced, from time to time.
"Default" means any event that is, or after notice or passage of time
would be, an Event of Default.
15
"Definitive Securities" means one or more certificated Securities
registered in the name of the Holder thereof and issued in accordance with
Section 2.5 hereof, in the form hereinbefore recited, except that such Security
shall not include the information called for by footnotes 3, 4, 5 and 8 thereof.
"Denny's Holdings" means the entity identified as "Denny's Holdings" in
the first paragraph hereof until a successor replaces it pursuant to this
Indenture, and thereafter means such successor.
"Denny's Holdings Group" means Denny's Holdings and any Subsidiary of
Denny's Holdings.
"Depositary" means, with respect to the Securities issuable or issued
in whole or in part in global form, the person specified as the Depositary with
respect to the Securities, until a successor shall have been appointed and
become such pursuant to the applicable provision of this Indenture, and
thereafter "Depositary" shall mean or include such successor.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
maturity date of the Securities.
"Distribution Compliance Period" means the 40-day restricted period, as
defined in Rule 903(b)(3) under the Securities Act.
"DTC" means The Depository Trust Company, which initially shall act as
Depositary with respect to the Global Securities.
"EBITDA" means, with respect to any person and its consolidated
Subsidiaries for a given period, the Consolidated Net Income of such person for
such period plus, with respect to an Issuer and its consolidated Subsidiaries,
(i) an amount equal to any net loss realized upon the sale or other disposition
of any Business Segment (to the extent such loss was deducted in computing
Consolidated Net Income), (ii) any provision for taxes based on income or
profits deducted in computing Consolidated Net Income and any provision for
taxes utilized in computing net loss under clause (i) hereof, (iii) consolidated
interest expense (including amortization of original issue discount and non-cash
interest payments, all net payments and receipts in respect of Interest Rate
Agreements and the interest component of capital leases) and (iv) depreciation
and amortization (including amortization of goodwill, deferred financing costs
existing immediately after the date hereof and other intangibles) to the extent
required under generally accepted accounting principles, all on a consolidated
basis; provided that if, during such period, (A) such person or any of its
Subsidiaries shall have made any asset sales (other than, in the case of an
Issuer and its Subsidiaries, sales of the Capital Stock of, or any assets of,
Unrestricted Subsidiaries), EBITDA of such person and its Subsidiaries for such
period shall be reduced by an amount equal to the EBITDA directly attributable
to the assets that are the subject of such asset sales for such period, and (B)
such person or any of its Subsidiaries has made any acquisition of assets or
Capital Stock (occurring by merger or otherwise), including, without limitation,
any acquisition of assets or Capital Stock occurring in connection with the
transaction causing a calculation to be made hereunder, EBITDA of such person
and its Subsidiaries shall be calculated, excluding any expenses which in the
good faith estimate of management of such person will be eliminated as a result
of such acquisition, on a pro forma basis as if such acquisition of assets or
Capital Stock (including the incurrence of any Indebtedness in connection with
any such acquisition and the application of the proceeds thereof) took place on
the first day of such period.
16
"Equity Interests" means Capital Stock or warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into or exchangeable for Capital Stock).
"Euroclear" means Euroclear Bank S.A./N.V., or its successors, as
operators of the Euroclear system.
"Event of Default"means any event or condition specified as such in
Section 4.1 which shall have continued for the period of time, if any, therein
designated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Exchange Offer" means an offer that may be made by the Issuers
pursuant to a Registration Rights Agreement to exchange Exchange Securities for
Additional Securities.
"Exchange Offer Registration Statement" shall have the meaning set
forth in the applicable Registration Rights Agreement.
"Exchange Securities" means a new series of debt securities of the
Issuers, including any guarantees endorsed thereon, identical in all respects to
the applicable series of Additional Securities issued hereunder in a private
placement, except for references to series and restrictive legends, issued
pursuant to an Exchange Offer.
"Excluded Property" means Advantica's corporate headquarters property
located in Spartanburg, South Carolina.
"Existing Indebtedness" means Indebtedness of an Issuer or any of its
Subsidiaries existing on the date hereof (other than Indebtedness under the Old
Notes and the Credit Agreement).
"Fixed Charge Coverage Ratio" means, with respect to any person for a
given period, the ratio of the EBITDA of such person for such period to the
Consolidated Fixed Charges of such person for such period.
"FRD" means FRD Acquisition Co., a Delaware corporation, a wholly owned
subsidiary of Advantica, and an Unrestricted Subsidiary hereunder.
"FRD Chapter 11 Case" means the voluntary petition under Chapter 11 of
the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware, Case No. 01-0436-PJW, filed by FRD on February 14, 2001.
"FRD Investment" means any Investments in FRD by either Issuer or any
of its Subsidiaries existing on the date hereof.
"Global Securities" means one or more Securities in the form
hereinbefore recited that includes the information referred to in footnotes 3, 4
and 8 (and, if applicable, 5) to the form of Security, issued under this
Indenture, that is deposited with or on behalf of and registered in the name of
the Depositary or its nominee.
"Global Security Legend" means the legend set forth in Section
2.5(g)(2), which is required to be placed on all Global Securities issued under
this Indenture.
17
"Holder", "holder", "holder of Securities", "securityholder",
"Securityholder" or other similar terms means the registered holder of any
Security.
"Indebtedness" means, with respect to any person at any date, without
duplication, (i) all obligations of such person for borrowed money, (ii) all
obligations of such person evidenced by bonds, debentures, notes or other
similar instruments other than Interest Rate Agreements, (iii) all reimbursement
obligations and other liabilities of such person with respect to letters of
credit issued for such person's account, (iv) all obligations of such person to
pay the deferred purchase price of property or services, except accounts payable
arising in the ordinary course of business, (v) all obligations of such person
as lessee in respect of capital lease obligations under capital leases and (vi)
all obligations of others of a nature described in any of clauses (i) through
(v) above guaranteed by such person; provided that, in the case of clauses (i)
through (v) above, Indebtedness shall include only obligations reported as
liabilities in the financial statements of such person in accordance with
generally accepted accounting principles.
"Indenture" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or
supplemented.
"Indirect Participant" means any entity that, with respect to DTC,
clears through or maintains a direct or indirect, custodial relationship with a
Participant.
"Initial Securities" means the 12 3/4% Senior Notes Due 2007
authenticated and delivered hereunder on the Original Issue Date, which shall
not exceed $204,050,000 in aggregate principal amount.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, that is not also a QIB.
"Interest Rate Agreement" means any interest rate protection agreement,
interest rate future, interest rate option, interest rate swap, interest rate
cap or other interest rate hedge arrangement to or under which an Issuer or any
of its subsidiaries is or becomes a party or a beneficiary.
"Investment" means any direct or indirect advance (other than advances
to customers in the ordinary course of business that are recorded as accounts
receivable on the balance sheet of any person or its subsidiaries), loan or
other extension of credit or capital contribution to (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition of Equity
Interest, bonds, notes, debentures or other securities issued by, any other
person.
"Issuers" means (except as otherwise provided in Article Five)
Advantica and Denny's Holdings.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind 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 capital
lease, any option or other agreement to sell and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant
to any applicable Registration Rights Agreement.
18
"Mortgage Financing" means the incurrence by an Issuer or any of its
Subsidiaries of any Indebtedness secured by a mortgage or other Lien on real
property acquired or improved by such Issuer or any such Subsidiary after the
date hereof.
"Mortgage Financing Proceeds" means, with respect to any Mortgage
Financing, the aggregate amount of cash proceeds received or receivable by an
Issuer or any of its Subsidiaries in connection with such financing after
deducting therefrom brokerage commissions, legal fees, finder's fees, closing
costs and other expenses incidental to such Mortgage Financing and the amount of
taxes payable in connection with or as a result of such transaction, to the
extent, but only to the extent, that the amounts so deducted are, at the time of
receipt of such cash, actually paid to a person that is not an Affiliate of such
Issuer or its Subsidiaries and are properly attributable to such transaction or
to the asset that is the subject thereof.
"Mortgage Refinancing" means the incurrence by an Issuer or any of its
Subsidiaries of any Indebtedness secured by a mortgage or other Lien on real
property subject to a mortgage or other Lien existing on the date hereof or
created or incurred subsequent to the date hereof as permitted hereby and owned
by such Issuer or any such Subsidiary.
"Mortgage Refinancing Proceeds" means, with respect to any Mortgage
Refinancing, the aggregate amount of cash proceeds received or receivable by an
Issuer or any of its Subsidiaries in connection with such refinancing after
deducting therefrom the original mortgage amount of the underlying indebtedness
refinanced therewith and brokerage commissions, legal fees, finder's fees,
closing costs and other expenses incidental to such Mortgage Refinancing and the
amount of taxes payable in connection with or as a result of such transaction,
to the extent, but only to the extent, that the amounts so deducted are, at the
time of receipt of such cash, actually paid to a person that is not an Affiliate
of such Issuer or its Subsidiaries and are properly attributable to such
transaction or to the asset that is the subject thereof.
"Net Income" of any person shall mean the net income (loss) of such
person, determined in accordance with generally accepted accounting principles,
excluding, however, (i) with respect to an Issuer and its Subsidiaries any gain
or loss, together with any related provision for taxes on such gain or loss,
realized upon the sale or other disposition (including, without limitation,
dispositions pursuant to sale and leaseback transactions) of a Business Segment,
and (ii) any gain or loss realized upon the sale or other disposition by such
person of any capital stock or marketable securities.
"Net Proceeds" with respect to any Asset Sale, sale and leaseback
transaction or sale or other disposition of a Business Segment, means (i) cash
(freely convertible into U.S. dollars) received by an Issuer or any of its
Subsidiaries from such transaction, after (a) provision for all income or other
taxes measured by or resulting from such transaction, (b) payment of all
brokerage commissions and other expenses (including, without limitation, the
payment of principal, premium (if any) and interest on Indebtedness required
(other than pursuant to Section 3.13(a)) to be paid as a result of such
transaction) in connection with such transaction and (c) deduction of
appropriate amounts to be provided by an Issuer as a reserve, in accordance with
generally accepted accounting principles, against any liabilities associated
with the asset disposed of in such transaction and retained by such Issuer or
its Subsidiaries after such sale or other disposition thereof, including,
without limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with such transaction and (ii) promissory notes received
by an Issuer or any of its Subsidiaries in connection with such transaction upon
the liquidation or conversion of such notes into cash.
19
"Obligations" means, with respect to any Indebtedness or any Interest
Rate Agreement, any principal, premium, interest (including, without limitation,
interest, whether or not allowed, after the filing of a petition initiating
certain bankruptcy proceedings), penalties, commissions, charges, expenses,
fees, indemnifications, reimbursements and other liabilities or amounts payable
under or in respect of the documentation governing such Indebtedness or such
Interest Rate Agreement.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board of Directors or the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") and by the Treasurer or the Secretary or any Assistant
Secretary of each Issuer (which may be a joint certificate of both Issuers) and
delivered to the Trustee. Each such certificate shall comply with Section 314 of
the Trust Indenture Act of 1939 and include the statements provided for in
Section 10.5, if and to the extent required hereby.
"Old Notes" means any outstanding 11-1/4% Senior Notes due 2008 of
Advantica issued pursuant to that certain indenture, dated as of January 7,
1998, by and between Advantica and U.S. Bank National Association (formerly,
First Trust National Association), as Trustee.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Issuers. Each such opinion
shall comply with Section 314 of the Trust Indenture Act and include the
statements provided for in Section 10.5, if and to the extent required hereby.
"Original Issue Date" means the date on which $204,050,000 aggregate
principal amount of Initial Securities was issued in exchange for $265,000,000
aggregate principal amount of Old Notes.
"Outstanding" when used with reference to the Securities, shall,
subject to the provisions of Section 6.4, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except
(a) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or
redemption of which moneys in the necessary amount shall have been
deposited in trust with the Trustee or with any paying agent (other
than an Issuer) or shall have been set aside, segregated and held in
trust by an Issuer (if an Issuer shall act as paying agent); provided
that, if such Securities are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as herein
provided, or provision satisfactory to the Trustee shall have been made
for giving such notice, and
(c) Securities in substitution for which other Securities
shall have been authenticated and delivered, or which shall have been
paid, pursuant to the terms of Section 2.6 (unless proof satisfactory
to the Trustee is presented that any of such Securities is held by a
person in whose hands such Security is a legal, valid and binding
obligation of the Issuers).
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Investments" means (i) Investments in cash (including major
foreign currency or currency of a country in which an Issuer or any of its
Subsidiaries has operations) or Cash Equivalents,
20
(ii) with respect to each Issuer and its Subsidiaries, Investments that are in
persons at least a majority of whose revenues are derived from food service
operations, ancillary operations or related activities and that have the purpose
of furthering the food service operations of such Issuer or any of its
Subsidiaries (other than any Investment by any of the Denny's Holdings Group in
any of the Advantica Group), (iii) advances to employees of Advantica or its
Subsidiaries not in excess of $5,000,000 in the aggregate at any one time
outstanding, (iv) accounts receivable created or acquired in the ordinary course
of business, (v) obligations or shares of stock received in connection with any
good faith settlement or bankruptcy proceeding involving a claim relating to a
Permitted Investment, (vi) evidences of Indebtedness, obligations or other
Investments not exceeding $5,000,000 in the aggregate held at any one time by
Advantica or any of its Subsidiaries and (vii) currency swap agreements and
other similar agreements designed to hedge against fluctuations in foreign
exchange rates entered into in the ordinary course of business in connection
with the operation of the business.
"Permitted Payments to Advantica" means, without duplication, payments
by any Subsidiary of Advantica to Advantica in an amount sufficient to enable
Advantica to (i) pay reasonable and necessary operating expenses and other
general corporate expenses of Advantica and its subsidiaries, (ii) pay foreign,
federal, state and local tax liabilities of Advantica and its current and former
subsidiaries to the extent that Advantica has an obligation to pay such tax
liabilities, the determination of which shall take into account any operating
losses, net operating loss carryovers, and other tax attributes available to
Advantica and its subsidiaries, (iii) pay, as and when the same becomes due and
payable, interest on the Old Notes, (iv) pay, as and when the same becomes due
and payable, (a) interest and (b) principal at maturity (or as otherwise
required pursuant to contractually scheduled principal payments, which, in the
case of Existing Indebtedness are existing on the date hereof, and, in the case
of Indebtedness incurred after the date hereof are existing on the date such
Indebtedness is incurred), in each case on the Credit Agreement, any Existing
Indebtedness and on any other Indebtedness incurred after the date hereof that
was permitted to be incurred in accordance with Section 3.11 and (v) repurchase,
redeem or otherwise acquire or retire for value, Equity Interests in Advantica
in accordance with clause (3) of, and the Old Notes in accordance with clause
(8) of, Section 3.9. Notwithstanding anything herein to the contrary, any such
payments made to Advantica pursuant hereto shall either be used by Advantica for
the purpose such payment was made to Advantica within 90 days of Advantica's
receipt of such payment or refunded to the party from whom Advantica received
such payment; provided, however, that to the extent that any such payments have
not been paid within such 90 day period, Advantica shall be entitled to retain
an amount that shall not at any time exceed an aggregate of $250,000 for the
purpose of making the payments described herein.
"Person" or "person" means any corporation, individual, limited
liability company, joint stock company, joint venture, partnership,
unincorporated association, governmental regulatory entity, country, state or
political subdivision thereof, trust, municipality or other entity.
"Preferred Stock" means with respect to any person, any and all shares,
interests, participations or other equivalents (however designated) of such
person's stock which is preferred or has a preference with respect to the
payment of dividends, or as to distributions upon any dissolution or liquidation
over Equity Interests of any other class of such person whether now outstanding
or issued after the date hereof.
"Principal" wherever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "and premium, if
any", whether or not so stated.
21
"Private Placement Legend" means the legend set forth in Section
2.5(g)(1) to be placed on all Additional Securities issued under this Indenture
except where specifically stated otherwise by the provisions of this Indenture.
"Public Offering" means any underwritten public offering for cash
pursuant to a registration statement filed with the Commission in accordance
with the Securities Act of Capital Stock other than Disqualified Stock of
Advantica or any of its Subsidiaries.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Reg S Permanent Global Security" means one or more permanent Global
Securities bearing the Private Placement Legend, that will be issued in an
aggregate amount of denominations equal in total to the outstanding principal
amount of the Reg S Temporary Global Security upon expiration of the
Distribution Compliance Period.
"Reg S Temporary Global Security" means one or more temporary Global
Securities bearing the Private Placement Legend and the Reg S Temporary Global
Security Legend, issued in an aggregate amount of denominations equal in total
to the outstanding principal amount of any Additional Securities initially sold
in reliance on Rule 903 of Regulation S.
"Reg S Temporary Global Security Legend" means the legend set forth in
Section 2.5(g)(3), which is required to be placed on all Reg S Temporary Global
Securities issued under this Indenture.
"Registrar" shall have the meaning set forth in Section 3.2.
"Registration Rights Agreement" means a Registration Rights Agreement
by and among the Issuers and the initial purchasers of Additional Securities
issued in a private placement, as such agreement may be amended, modified or
supplemented from time to time.
"Regulation S" means Regulation S promulgated under the Securities Act,
as it may be amended from time to time, and any successor provision thereto.
"Regulation S Global Security" means a Reg S Temporary Global Security
or a Reg S Permanent Global Security, as the case may be.
"Responsible Officer" when used with respect to the Trustee, means the
chairman of the board of directors, any vice chairman of the board of directors,
the chairman of the trust committee, the chairman of the executive committee,
any vice chairman of the executive committee, the president, any vice president
(whether or not designated by numbers or words added before or after the title
"vice president"), the cashier, the secretary, the treasurer, any trust officer,
any assistant trust officer, any assistant vice president, any assistant
cashier, any assistant secretary, any assistant treasurer, or any other officer
or assistant officer of the Trustee customarily performing functions similar to
those performed by the persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Definitive Security" means one or more Definitive
Securities bearing the Private Placement Legend, issued under this Indenture.
"Restricted Global Security" means one or more Global Securities
bearing the Private Placement Legend, issued under this Indenture, provided that
in no case shall an Initial Security or an Exchange
22
Security issued in accordance with this Indenture and, in the case of an
Exchange Security, the terms of the applicable Registration Rights Agreement be
a Restricted Global Security.
"Restricted Investments" means (i) any Investment by any of the (a)
Advantica Group in any person that is not a wholly owned Subsidiary of Advantica
and (b) Denny's Holdings Group in any person that is not a wholly owned
Subsidiary of Denny's Holdings, or (ii) other transfers of assets by any of the
(a) Advantica Group to any Subsidiary or Affiliate of Advantica that is not a
wholly owned Subsidiary of Advantica or (b) Denny's Holdings Group to any
Subsidiary or Affiliate of Denny's Holdings that is not a wholly owned
Subsidiary of Denny's Holdings (other than any such other transfers of assets
described in clause (ii) above in transactions the terms of which are fair and
reasonable to the transferor and are at least as favorable as the terms that
could be obtained by the transferor in a comparable transaction made on an arms'
length basis between unaffiliated parties, as conclusively determined, for any
such transfer involving aggregate consideration in excess of $5,000,000, by a
majority of the directors of Advantica or Denny's Holdings, as applicable, that
are unaffiliated with the transferee or, if there are no such directors, by a
majority of the directors of Advantica or Denny's Holdings, as applicable),
except in each case for Permitted Investments and any such Investments existing
on the date hereof.
"Restricted Security" means an Additional Security, unless or until it
has been (i) effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering it or (ii) distributed to
the public pursuant to Rule 144 (or any similar provision then in force) under
the Securities Act; provided, that in no case shall an Initial Security or an
Exchange Security issued in accordance with this Indenture and the terms and, in
the case of an Exchange Security, provisions of a Registration Rights Agreement
be a Restricted Security.
"Rule 144A" means Rule 144A promulgated under the Securities Act, as it
may be amended from time to time, and any successor provision thereto.
"Security" or "Securities" means any Initial Securities, any Exchange
Securities, when and if issued as provided in the applicable Registration Rights
Agreement, and any Additional Securities.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Senior Indebtedness" means (i) all obligations of an Issuer and its
Subsidiaries now or hereafter existing under or in respect of the Credit
Agreement, the Old Notes and the Securities, whether for principal, interest
(including, without limitation, interest accruing after the filing of a petition
initiating any proceeding referred to in Section 4.1(6) or Section 4.1(7),
whether or not such interest is an allowable claim under such proceeding),
penalties, commissions, charges, indemnifications, liabilities, reimbursement
obligations in respect of letters of credit, fees, expenses or other amounts
payable under or in respect of the Credit Agreement the Old Notes and the
Securities and all obligations and claims related thereto, (ii) all Obligations
of an Issuer in respect of Interest Rate Agreements and (iii) additional
Indebtedness permitted by Section 3.11(a), Section 3.11(b) or Section 3.11(c)
which is not expressly by its terms subordinated to the Securities and all
Obligations and claims related thereto; provided, that Senior Indebtedness shall
not include (x) any Indebtedness of an Issuer to any of its Subsidiaries or (y)
Indebtedness incurred for the purchase of goods or materials or for services
(other than services provided by the Credit Agent in connection with the Credit
Agreement or any other party to an agreement evidencing Senior Indebtedness in
connection with such agreement) obtained in the ordinary course of business.
"Senior Indebtedness" under or in respect of the Credit Agreement, the Old Notes
and the Securities shall continue to constitute Senior Indebtedness for all
purposes of this Indenture
23
notwithstanding that such Senior Indebtedness or any obligations or claims in
respect thereof may be disallowed, avoided or subordinated pursuant to any
Bankruptcy Law or other applicable insolvency law or equitable principles.
"Shelf Registration Statement" shall have the meaning set forth in the
applicable Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary of an Issuer that would
be a "significant subsidiary" as defined in Rule 1-02 of Regulation S-X under
the Securities Act and the Exchange Act (as such Regulation is in effect on the
date hereof) (excluding, except for the purposes of determining an Event of
Default, subparagraph (c) of Rule 1-02 of Regulation S-X).
"Subsidiary" of any person means any entity of which shares of the
Capital Stock or other Equity Interests (including partnership interests)
entitled to cast at least a majority of the votes that may be cast by all shares
or Equity Interests having ordinary voting power for the election of directors
or other governing body of such entity are owned by such person directly and/or
through one or more Subsidiaries of such person; provided that each Unrestricted
Subsidiary shall be excluded from the definition of "Subsidiary."
"Transfer Restricted Securities" means Global Securities and Definitive
Securities issued under this Indenture that bear or are required to bear the
Private Placement Legend.
"Trustee" means the entity identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Five, shall also
include any successor trustee.
"Trust Indenture Act of 1939" means the Trust Indenture Act of 1939 as
in force at the date as of which this Indenture was originally executed (except
for purposes of the terms of any supplemental indenture executed pursuant to
Article VII).
"Unrestricted Definitive Security" means one or more Definitive
Securities issued under this Indenture that do not bear and are not required to
bear the Private Placement Legend.
"Unrestricted Global Security" means one or more permanent Global
Securities representing a series of Securities issued under this Indenture that
does not bear and is not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means (i) FRD, (ii) any subsidiary of an
Issuer that at the time of determination is an Unrestricted Subsidiary (as
designated by such Issuer's Board of Directors, as provided below) and (iii) any
subsidiary of an Unrestricted Subsidiary. The Board of Directors of such Issuer
may designate any subsidiary of an Issuer (including any Subsidiary and any
newly acquired or newly formed subsidiary) to be an Unrestricted Subsidiary
unless such subsidiary owns any Capital Stock of, or owns, or holds any Lien on,
any property of, any Subsidiary of such Issuer (other than any subsidiary of the
subsidiary to be so designated); provided that (a) any Unrestricted Subsidiary
must be an entity of which shares of the Capital Stock or other Equity Interests
(including partnership interests) entitled to cast at least a majority of the
votes that may be cast by all shares or Equity Interests having ordinary voting
power for the election of directors or other governing body are owned, directly
or indirectly, by such Issuer; (b) such Issuer certifies that such designation
complies with Section 3.9 and Section 3.17 and (c) each of (1) the subsidiary to
be so designated and (2) its subsidiaries have not at the time of designation,
and do not thereafter, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable with respect to any Indebtedness pursuant
to which the lender has recourse to
24
any of the assets of such Issuer or any of its Subsidiaries. The Board of
Directors of such Issuer may designate any Unrestricted Subsidiary to be a
Subsidiary; provided that, immediately after giving effect to such designation,
Advantica could incur at least $1 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth in Section 3.11(a) on a pro forma
basis taking into account such designation.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the then
outstanding aggregate principal amount of such Indebtedness into (ii) the total
of the product 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) which will elapse
between such date and the making of such payment.
ARTICLE TWO
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
SECTION 2.1 Authentication and Delivery of Securities. Upon the
execution and delivery of this Indenture, or from time to time thereafter,
Securities in an aggregate principal amount not in excess of $254,050,000
(except as otherwise provided in Section 2.6) may be executed by the Issuers and
delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Securities (provided, that Securities executed,
delivered and authenticated for issuance on the Original Issue Date shall not
exceed $204,050,000 in aggregate principal amount and Securities executed,
delivered and authenticated for issuance subsequent to the Original Issue Date
(other than pursuant to an Exchange Offer) shall not exceed $50,000,000 in
aggregate principal amount) to or upon the written order of the Issuers, signed
by both (a) the Chairman of the Board of Directors, or any Vice Chairman of the
Board of Directors, or the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") of each Issuer and (b) the Treasurer or any Assistant
Treasurer or the Secretary or any Assistant Secretary of each Issuer without any
further action by the Issuers.
SECTION 2.2 Execution of Securities. The Securities shall be signed on
behalf of the Issuers by both (a) the Chairman of the Board of Directors or any
Vice Chairman of the Board of Directors or the President or any Vice President
(whether or not designated by a number or numbers or a word or words added
before or after the title "Vice President") of each Issuer and (b) by the
Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary
of each Issuer under each Issuer's corporate seal which may, but need not, be
attested. Such signatures may be the manual or facsimile signatures of the
present or any future such officers. The seal of each Issuer may be in the form
of a facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Securities. Typographical and other minor errors or defects in
any such reproduction of the seal or any such signature shall not affect the
validity or enforceability of any Security which has been duly authenticated and
delivered by the Trustee.
In case any officer of an Issuer who shall have signed any of the
Securities shall cease to be such officer before the Security so signed shall be
authenticated and delivered by the Trustee or disposed of by the Issuers, such
Security nevertheless may be authenticated and delivered or disposed of as
though the person who signed such Security had not ceased to be such officer of
such Issuer; and any Security may be signed on behalf of such Issuer by such
persons as, at the actual date of the execution of such Security, shall be the
proper officers of such Issuer, although at the date of the execution and
delivery of this Indenture any such person was not such officer.
25
SECTION 2.3 Certificate of Authentication. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinbefore recited, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon any
Security executed by the Issuers shall be conclusive evidence that the Security
so authenticated has been duly authenticated and delivered hereunder and that
the holder is entitled to the benefits of this Indenture.
SECTION 2.4 Form, Denomination and Date of Securities; Payments of
Interest. The Securities and the Trustee's certificates of authentication shall
be substantially in the form recited above. The Securities shall be issuable as
registered securities without coupons and in denominations provided for in the
form of Security above recited. The Securities shall be numbered, lettered, or
otherwise distinguished in such manner or in accordance with such plans as the
officers of the Issuers executing the same may determine with the approval of
the Trustee.
Any of the Securities may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Indenture, as may be required to comply with any law, or with any rules
or regulations pursuant thereto, or with the rules of any securities market in
which the Securities are admitted to trading, or to conform to general usage.
Each Security shall be dated the date of its authentication, shall bear
interest from the applicable date and shall be payable on the dates and in the
manner specified on the face of the form of Security recited above.
The person in whose name any Security is registered at the close of
business on any record date with respect to any interest payment date shall be
entitled to receive the interest, if any, payable on such interest payment date
notwithstanding any transfer or exchange of such Security subsequent to the
record date and prior to such interest payment date, except if and to the extent
the Issuers shall default in the payment of the interest due on such interest
payment date, in which case such defaulted interest shall be paid to the persons
in whose names outstanding Securities are registered at the close of business on
a subsequent record date (which shall be not less than five business days prior
to the date of payment of such defaulted interest) established by notice given
by mail by or on behalf of the Issuers to the holders of Securities not less
than 15 days preceding such subsequent record date. The term "record date", as
used with respect to any interest payment date (except a date for payment of
defaulted interest), shall mean if such interest payment date is the last day of
a calendar month, the fifteenth day of such calendar month and shall mean, if
such interest payment date is the fifteenth day of a calendar month, the first
day of such calendar month, whether or not such record date is a business day.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
SECTION 2.5 Registration, Transfer and Exchange. The Issuers shall keep
at each office or agency to be maintained for the purpose as provided in Section
3.2 a register or registers in which, subject to such reasonable regulations as
it may prescribe, it will register, and will register the transfer of,
Securities as in this Article provided. Such register shall be in written form
in the English language or in any other form capable of being converted into
such form within a reasonable time. At all reasonable times such register or
registers shall be open for inspection by the Trustee.
(a) Transfer and Exchange of Global Securities. A Global Security may
not be transferred except as a whole 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
Securities will be
26
exchanged by the Issuers for Definitive Securities if (i) the Issuers deliver to
the Trustee notice from the Depositary that (x) the Depositary is unwilling or
unable to continue to act as Depositary for the Global Securities and the
Issuers thereupon fail to appoint a successor Depositary within 90 days or (y)
the Depositary is no longer a clearing agency registered under the Exchange Act,
(ii) the Issuers, in their sole discretion, determine that the Global Securities
(in whole but not in part) should be exchanged for Definitive Securities and
deliver a written notice to such effect to the Trustee or (iii) upon request of
the Trustee or Holders of a majority of the aggregate principal amount of
outstanding Securities if there shall have occurred and be continuing a Default
or Event of Default with respect to the Securities, provided that in no event
shall the Reg S Temporary Global Security be exchanged by the Issuers for
Definitive Securities prior to (x) the expiration of the Distribution Compliance
Period and (y) the receipt by the Registrar of any certificate identified by the
Issuers and their counsel to be required pursuant to Rule 903 or Rule 904 under
the Securities Act. Upon the occurrence of any of the preceding events in (i),
(ii) or (iii) above, Definitive Securities shall be issued in such names as the
Depositary shall instruct the Trustee. Global Securities also may be exchanged
or replaced, in whole or in part, as provided in Sections 2.7 and 2.8 hereof.
Every Security authenticated and delivered in exchange for, or in lieu of, a
Global Security or any portion thereof, pursuant to this Section 2.5 or Section
2.7 or 2.8 hereof, shall be authenticated and delivered in the form of, and
shall be, a Global Security. A Global Security may not be exchanged for another
Security other than as provided in this Section 2.5(a); however, beneficial
interests in a Global Security may be transferred and exchanged as provided in
Section 2.5(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Securities. The transfer and exchange of beneficial interests in the Global
Securities shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Securities shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Securities also shall
require compliance with either subparagraph (1) or (2) below, as applicable, as
well as one or more of the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global
Security. Beneficial interests in any Restricted Global Security may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Security in
accordance with the transfer restrictions set forth in the Private
Placement Legend; provided, however, that prior to the expiration of
the Distribution Compliance Period, transfers of beneficial interests
in the Reg S Temporary Global Security may not be made to a U.S. person
(as such term is defined in Regulation S) or for the account or benefit
of a U.S. person (other than an initial purchaser that participated in
the offering of the applicable Additional Securities). Beneficial
interests in any Unrestricted Global Security may be transferred to
Persons who take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Security. No written orders or instructions
shall be required to be delivered to the Registrar to effect the
transfers described in this Section 2.5(b)(1), but the Issuers or the
Trustee may request an opinion of counsel.
(2) All Other Transfers and Exchanges of Beneficial Interests
in Global Securities (including for Definitive Securities). In
connection with all transfers and exchanges of beneficial interests
that are not subject to Section 2.5(b)(1) above, the transferor of such
beneficial interest must deliver to the Registrar either (A) (1) an
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 Security 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) an
order from a Participant or an Indirect Participant given
27
to the Depositary in accordance with the Applicable Procedures
directing the Depositary to cause to be issued a Definitive Security 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 Security shall be registered to effect the transfer or
exchange referred to in (B)(1) above, provided that in no event shall
Definitive Securities be issued upon the transfer or exchange of
beneficial interests in the Reg S Temporary Global Security prior to
(x) the expiration of the Distribution Compliance Period and (y) the
receipt by the Registrar of any certificates identified by the Issuers
or its counsel to be required pursuant to Rule 903 and Rule 904 under
the Securities Act. Upon consummation of an Exchange Offer by the
Issuers in accordance with Section 2.5(f) hereof, the requirements of
this Section 2.5(b)(2) shall be deemed to have been satisfied upon
receipt by the Registrar of the instructions contained in the Letter of
Transmittal delivered by the Holder of such beneficial interests in the
Restricted Global Securities. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Securities contained in this Indenture and the Securities or otherwise
applicable under the Securities Act, the Trustee shall adjust the
principal amount of the relevant Global Security(ies) pursuant to
Section 2.5(h) hereof.
(3) Transfer of Beneficial Interests to Another Restricted
Global Security. A beneficial interest in any Restricted Global
Security may be transferred to a Person who takes delivery thereof in
the form of a beneficial interest in another Restricted Global Security
if the transfer complies with the requirements of Section 2.5(b)(2)
above and the Registrar receives the following:
(A) if the transferee will take delivery in the form
of a beneficial interest in the 144A Global Security, then the
transferor must deliver a certificate in the form of Exhibit A
hereto, including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form
of a beneficial interest in the 501 Global Security, then the
transferor must deliver a certificate in the form of Exhibit A
hereto, including the certifications in item (3)(d) thereof;
or
(C) if the transferee will take delivery in the form
of a beneficial interest in the Reg S Temporary Global
Security or the Reg S Permanent Global Security, then the
transferor must deliver a certificate in the form of Exhibit A
hereto, including the certifications in item (2) thereof.
(4) Transfer and Exchange of Beneficial Interests in a
Restricted Global Security for Beneficial Interests in an Unrestricted
Global Security. A beneficial interest in any Restricted Global
Security may be exchanged by any holder thereof for a beneficial
interest in an Unrestricted Global Security or transferred to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Security if the exchange or transfer complies with
the requirements of Section 2.5(b)(2) above and:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the applicable
Registration Rights Agreement and Section 2.5(f) hereof, and
the holder of the beneficial interest to be transferred, in
the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a Broker-Dealer, (2) a Person participating
in the distribution of the Exchange Securities or (3) a Person
who is an affiliate (as defined in Rule 144) of an Issuer;
28
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the applicable
Registration Rights Agreement and a certificate to the effect
set forth in Exhibit A hereto, including the certifications in
item (3)(c) thereof, is delivered by the transferor;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the applicable Registration Rights Agreement
and a certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(c) thereof, is
delivered by the transferor; or
(D) the Registrar receives the following: (1) if
the holder of such beneficial interest in a Restricted Global
Security proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Security, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (1)(a) thereof; or (2) if
the holder of such beneficial interest in a Restricted Global
Security proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Security, a
certificate from such holder in the form of Exhibit A hereto,
including the certifications in item (4) thereof; and, in each
such case set forth in this subparagraph (D), an Opinion of
Counsel in form, and from legal counsel, reasonably acceptable
to the Registrar and the Issuers to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Security has not yet been issued,
the Issuers shall issue and, upon receipt of authentication instructions from
the Issuers in accordance with this Indenture, the Trustee shall authenticate
one or more Unrestricted Global Securities in an aggregate principal amount
equal to the aggregate principal amount of beneficial interests transferred
pursuant to subparagraph (B) or (D) above. Beneficial interests in an
Unrestricted Global Security cannot be exchanged for, or transferred to Persons
who take delivery thereof in the form of, a beneficial interest in a Restricted
Global Security.
(c) Transfer and Exchange of Beneficial Interests for Definitive
Securities. Transfer and exchange of beneficial interests in the Global
Securities for Definitive Securities shall be made subject to compliance with
this Section 2.5(c), and the requesting Holder shall provide any certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.5(c). Upon receipt of such applicable
documentation, the Trustee shall cause the aggregate principal amount of the
applicable Restricted Global Security or Unrestricted Global Security, as
applicable, to be reduced accordingly pursuant to Section 2.5 (h) hereof, and
the Issuers shall execute and, upon receipt of authentication instructions from
the Issuers in accordance with this Indenture, the Trustee shall authenticate
and deliver to the Person designated in the instructions a Restricted Definitive
Security or an Unrestricted Definitive Security, as applicable, in the
appropriate principal amount. Any Definitive Security issued in exchange for a
beneficial interest in a Global Security pursuant to this Section 2.5(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 Securities to
the Persons in whose names such Definitive Securities are so registered.
(1) Beneficial Interests in Restricted Global Securities to
Restricted Definitive Securities. If any holder of a beneficial
interest in a Restricted Global Security proposes to
29
exchange such beneficial interest for a Restricted Definitive Security
or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Restricted Definitive Security, then, upon
receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Security proposes to exchange such
beneficial interest for a Restricted Definitive Security, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in
Exhibit A hereto, including the certifications in item (1)
thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person (as such term is defined in
Regulation S) in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate
to the effect set forth in Exhibit A hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) and (C) above, a certificate to the effect set forth in
Exhibit A hereto, including the certifications, certificates
and Opinion of Counsel required by item (3)(d) thereof, if
applicable; or
(E) if such beneficial interest is being
transferred to the Issuers or any of their Subsidiaries, a
certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(b) thereof.
Any Restricted Definitive Security issued in exchange for a beneficial interest
in a Restricted Global Security pursuant to this Section 2.5(c)(1) shall bear
the Private Placement Legend and shall be subject to all restrictions on
transfer contained therein.
(2) Beneficial Interests in Restricted Global Securities to
Unrestricted Definitive Securities. A holder of a beneficial interest
in a Restricted Global Security may exchange such beneficial interest
for an Unrestricted Definitive Security or may transfer such beneficial
interest to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Security only if:
(A) such exchange or transfer is effected pursuant
to the Exchange Offer in accordance with the applicable
Registration Rights Agreement and Section 2.5(f) hereof, and
the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is
not (1) a Broker-Dealer, (2) a Person participating in the
distribution of the Exchange Securities or (3) a Person who is
an affiliate (as defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the applicable
Registration Rights Agreement and a certificate to the effect
set forth in Exhibit A hereto, including the certifications in
item (3)(c) thereof, is delivered by the transferor;
30
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement and a
certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(c) thereof, is
delivered by the transferor; or
(D) the Registrar receives the following: (1) if
the holder of such beneficial interest in a Restricted Global
Security proposes to exchange such beneficial interest for an
Unrestricted Definitive Security, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (1)(b) thereof; or (2) if the holder of
such beneficial interest in a Restricted Global Security
proposes to transfer such beneficial interest to a Person who
shall take delivery thereof in the form of an Unrestricted
Definitive Security, a certificate from such holder in the
form of Exhibit A hereto, including the certifications in item
(4) thereof; and, in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form, and from
legal counsel, reasonably acceptable to the Registrar and the
Issuers to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions
on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance
with the Securities Act.
Beneficial interests in an Unrestricted Global Security cannot be exchanged for,
or transferred to Persons who take delivery thereof in the form of, a Restricted
Definitive Security.
(3) Beneficial Interests in Unrestricted Global Securities to
Unrestricted Definitive Securities. If any holder of a beneficial
interest in an Unrestricted Global Security proposes to exchange such
beneficial interest for an Unrestricted Definitive Security or to
transfer such beneficial interest to a Person who takes delivery
thereof in the form of an Unrestricted Definitive Security, then such
holder shall satisfy the applicable conditions set forth in Section
2.5(b)(2) hereof. Any Unrestricted Definitive Security issued in
exchange for a beneficial interest pursuant to this Section 2.5(c)(3)
shall not bear the Private Placement Legend.
(4) Transfer or Exchange of Reg S Temporary Global Securities.
Notwithstanding the other provisions of this Section 2.5, a beneficial
interest in the Reg S Temporary Global Security may not be (A)
exchanged for a Definitive Security prior to (x) the expiration of the
Distribution Compliance Period (unless such exchange is approved by the
Issuers, does not require an investment decision on the part of the
Holder thereof and does not violate the provisions of Regulation S) and
(y) the receipt by the Registrar of any certificates identified by the
Issuers or its counsel to be required pursuant to Rule 903(b)(3)(ii)(B)
under the Securities Act or (B) transferred to a Person who takes
delivery thereof in the form of a Definitive Security prior to the
events set forth in clause (A) above or unless the transfer is pursuant
to an exemption from the registration requirements of the Securities
Act other than Rule 903 or Rule 904.
(d) Transfer and Exchange of Definitive Securities for Beneficial
Interests. Transfer and exchange of Definitive Securities for beneficial
interests in the Global Securities shall be made subject to compliance with this
Section 2.5(d), and the requesting Holder shall provide any certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.5(d). Upon receipt from such Holder of such
applicable documentation and the surrender to the Registrar of the Definitive
Securities 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, the Registrar shall register the transfer
or exchange of the Definitive Securities. The Trustee shall cancel such
Definitive Securities so surrendered and cause the aggregate principal amount of
the
31
applicable Restricted Global Security or Unrestricted Global Security, as
applicable, to be increased accordingly pursuant to Section 2.5(h) hereof.
(1) Restricted Definitive Securities to Beneficial Interests
in Restricted Global Securities. If any Holder of a Restricted
Definitive Security proposes to exchange such Security for a beneficial
interest in a Restricted Global Security or to transfer such Restricted
Definitive Securities to a Person who takes delivery thereof in the
form of a beneficial interest in a Restricted Global Security, then,
upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive
Security proposes to exchange such Security for a beneficial
interest in a Restricted Global Security, a certificate from
such Holder in the form of Exhibit B hereto, including the
certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Security is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in
Exhibit A hereto, including the certifications in item (1)
thereof;
(C) if such Restricted Definitive Security is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act,
a certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (2) thereof; or
(D) if such Restricted Definitive Security is being
transferred to an Institutional Accredited Investor in
accordance with Regulation D under the Securities Act, a
certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(d) thereof;
the Trustee shall cancel the Restricted Definitive Security and increase or
cause to be increased the aggregate principal amount of, in the case of clause
(A) above, the appropriate Restricted Global Security, in the case of clause (B)
above, the 144A Global Security, in the case of clause (C) above, the Regulation
S Global Security and in the case of clause (D) above, the 501 Global Security.
(2) Restricted Definitive Securities to Beneficial Interests
in Unrestricted Global Securities. A Holder of a Restricted Definitive
Security may exchange such Security for a beneficial interest in an
Unrestricted Global Security or transfer such Restricted Definitive
Security to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Security only if:
(A) such exchange or transfer is effected pursuant
to the Exchange Offer in accordance with the applicable
Registration Rights Agreement and Section 2.5(f) hereof, and
the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a Broker-Dealer, (2) a Person
participating in the distribution of the Exchange Securities
or (3) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the applicable
Registration Rights Agreement and a certificate to the effect
set forth in Exhibit A hereto, including the certifications in
item (3)(c) thereof, is delivered by the transferor;
32
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the applicable Registration Rights Agreement
and a certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(c) thereof, is
delivered by the transferor; or
(D) the Registrar receives the following: (1) if
the Holder of such Restricted Definitive Securities proposes
to exchange such Securities for a beneficial interest in the
Unrestricted Global Security, a certificate from such Holder
in the form of Exhibit B hereto, including the certifications
in item (1)(c) thereof; or (2) if the Holder of such
Restricted Definitive Securities proposes to transfer such
Securities to a Person who shall take delivery thereof in the
form of a beneficial interest in the Unrestricted Global
Security, a certificate from such Holder in the form of
Exhibit A hereto, including the certifications in item (4)
thereof; and, in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form, and from legal counsel,
reasonably acceptable to the Registrar and the Issuers to the
effect that such exchange or transfer is in compliance with
the Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the
Securities Act.
(3) Unrestricted Definitive Securities to Beneficial Interests
in Unrestricted Global Securities. A Holder of an Unrestricted
Definitive Security may exchange such Security for a beneficial
interest in an Unrestricted Global Security or transfer such Definitive
Securities to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Security at any time.
If any such exchange or transfer from a Definitive Security to a beneficial
interest is effected pursuant to subparagraphs (2)(B), (2)(D) or (3) of this
Section 2.5(d) at a time when an Unrestricted Global Security has not yet been
issued, the Issuers shall issue and, upon receipt of authentication instructions
from the Issuers in accordance with this Indenture, the Trustee shall
authenticate one or more Unrestricted Global Securities in an aggregate
principal amount equal to the principal amount of Definitive Securities so
transferred.
(e) Transfer and Exchange of Definitive Securities for Definitive
Securities. Upon request by a Holder of Definitive Securities and such Holder's
compliance with the provisions of this Section 2.5(e), the Registrar shall
register the transfer or exchange of Definitive Securities. Prior to such
registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Definitive Securities 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. The Trustee shall cancel any such Definitive Securities so surrendered,
and the Issuers shall execute and, upon receipt of authentication instructions
from the Issuers in accordance with this Indenture, the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Restricted Definitive Security or an Unrestricted Definitive Security, as
applicable, in the appropriate principal amount. Any Definitive Security issued
pursuant to this Section 2.5(e) 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 Securities to the Persons in whose names such Definitive Securities
are so registered. In addition, the requesting Holder shall provide any
additional certifications, documents and information, as applicable, required
pursuant to the following provisions of this Section 2.5(e).
33
(1) Restricted Definitive Securities to Restricted Definitive
Securities. Any Restricted Definitive Security may be transferred to
and registered in the name of Persons who take delivery thereof in the
form of a Restricted Definitive Security if the Registrar receives the
following:
(A) if the transfer will be made to a QIB pursuant
to Rule 144A under the Securities Act, then the transferor
must deliver a certificate in the form of Exhibit A hereto,
including the certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule
903 or Rule 904, then the transferor must deliver a
certificate in the form of Exhibit A hereto, including the
certifications in item (2) thereof;
(C) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(A) and (B) above, then the transferor must deliver a
certificate to the effect set forth in Exhibit A hereto,
including the certifications, certificates and Opinion of
Counsel required by item (3)(d) thereof, if applicable; or
(D) if such beneficial interest is being
transferred to the Issuers or any of their Subsidiaries, a
certificate to the effect set forth in Exhibit A hereto,
including the certifications in item (3)(b) thereof, must be
delivered by the transferor.
(2) Restricted Definitive Securities to Unrestricted
Definitive Securities. Any Restricted Definitive Security may be
exchanged by the Holder thereof for an Unrestricted Definitive Security
or transferred to a Person or Persons who take delivery thereof in the
form of an Unrestricted Definitive Security if:
(A) such exchange or transfer is effected pursuant
to the Exchange Offer in accordance with the applicable
Registration Rights Agreement and Section 2.5(f) hereof, and
the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a Broker-Dealer, (2) a Person
participating in the distribution of the Exchange Securities
or (3) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;
(B) any such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the applicable
Registration Rights Agreement and a certificate to the effect
set forth in Exhibit A hereto, including the certifications in
item (3)(c) thereof, is delivered by the transferor;
(C) any such transfer is effected by a
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the applicable Registration
Rights Agreement and a certificate to the effect set forth in
Exhibit A hereto, including the certifications in item (3)(c)
thereof, is delivered by the transferor; or
(D) the Registrar receives the following: (1) if
the Holder of such Restricted Definitive Securities proposes
to exchange such Securities for an Unrestricted Definitive
Security, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (1)(d)
thereof; or (2) if the Holder of such Restricted Definitive
Securities proposes to transfer such Securities to a Person
who shall take delivery thereof
34
in the form of an Unrestricted Definitive Security, a
certificate from such Holder in the form of Exhibit A hereto,
including the certifications in item (4) thereof; and, in each
such case set forth in this subparagraph (D), an Opinion of
Counsel in form, and from legal counsel, reasonably acceptable
to the Registrar and the Issuers to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(3) Unrestricted Definitive Securities to Unrestricted
Definitive Securities. A Holder of Unrestricted Definitive Securities
may transfer such Securities to a Person who takes delivery thereof in
the form of an Unrestricted Definitive Security. Upon receipt of a
request to register such a transfer, the Registrar shall register the
Unrestricted Definitive Securities pursuant to the instructions from
the Holder thereof.
(f) Exchange Offer. Upon the occurrence of an Exchange Offer in
accordance with the applicable Registration Rights Agreement, the Issuers shall
issue and, upon receipt of authentication instructions from the Issuers in
accordance with this Indenture and an Opinion of Counsel for the Issuers as to
certain matters discussed in this Section 2.5(f), the Trustee shall authenticate
(i) one or more Unrestricted Global Securities in an aggregate principal amount
equal to the sum of (A) the principal amount of the beneficial interests in the
Restricted Global Securities exchanged or transferred for beneficial interests
in Unrestricted Global Securities in connection with the Exchange Offer pursuant
to Section 2.5(b)(4) and (B) the principal amount of Restricted Definitive
Securities exchanged or transferred for beneficial interests in Unrestricted
Global Securities in connection with the Exchange Offer pursuant to Section
2.5(d)(2), in each case tendered for acceptance by Persons that certify in the
applicable Letters of Transmittal that (x) they are not Broker-Dealers, (y) they
are not participating in a distribution of the Exchange Securities and (z) they
are not affiliates (as defined in Rule 144) of an Issuer, and accepted for
exchange in the Exchange Offer, and (ii) Unrestricted Definitive Securities in
an aggregate principal amount equal to the sum of (A) the principal amount of
the Restricted Definitive Securities exchanged or transferred for Unrestricted
Definitive Securities in connection with the Exchange Offer pursuant to Section
2.5(e)(2) and (B) Restricted Global Securities exchanged or transferred for
Unrestricted Definitive Securities in connection with the Exchange Offer
pursuant to Section 2.5(c)(2), in each case tendered for acceptance by Persons
that certify in the applicable Letters of Transmittal that (x) they are not
Broker-Dealers, (y) they are not participating in a distribution of the Exchange
Securities and (z) they are not affiliates (as defined in Rule 144) of an
Issuer, and accepted for exchange in the Exchange Offer. Concurrently with the
issuance of such Securities, the Trustee shall cancel any Definitive Securities
so surrendered and shall cause the aggregate principal amount of the applicable
Restricted Global Securities to be reduced accordingly, and the Issuers shall
execute and, upon receipt of authentication instructions from the Issuers in
accordance with this Indenture, the Trustee shall authenticate and deliver to
the Persons designated by the Holders of Definitive Securities so accepted
Definitive Securities in the appropriate principal amount.
The Opinion of Counsel for the Issuers referenced above shall state in
substance that the issuance and sale of the Exchange Securities by the Issuers
have been duly authorized and, when executed by the Issuers and authenticated by
the Trustee in accordance with the provisions of this Indenture and delivered in
exchange for the applicable Additional Securities in accordance with this
Indenture and the applicable Exchange Offer, the Exchange Securities will be
entitled to the benefits of this Indenture and will be valid and binding
obligations of the Issuers, enforceable against the Issuers in accordance with
their terms, except as the enforceability thereof may be limited by (x)
bankruptcy, fraudulent transfer, insolvency, reorganization, moratorium or
similar laws now or hereafter in effect relating to or affecting
35
creditors' rights generally and (y) principles of equity (regardless of whether
enforceability is considered in equity or at law).
(g) Legends. The following legends shall appear on the face of all
Global Securities and Definitive Securities issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below,
each Global Security and each Definitive Security (and all
Securities issued in exchange therefor or substitution
thereof) shall bear the legend in substantially the following
form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL
OR OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE DATE WHICH IS TWO
YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE
144(k) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF RESTRICTED
SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR
ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION
DATE") ONLY (A) TO AN ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE ▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER
THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E)
TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUERS' AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM AND IN EACH OF THE FOREGOING
CASES A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE INDENTURE
IS
36
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND IN EACH
CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY U.S. STATE OR
ANY OTHER APPLICABLE JURISDICTION. THE HOLDER OF THIS SECURITY AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
(B) Notwithstanding the foregoing, any Global
Security or Definitive Security issued pursuant to
subparagraphs (b)(4), (c)(2), (c)(3), (d)(2), (d)(3), (e)(2),
(e)(3) or (f) of this Section 2.5 (and all Securities issued
in exchange therefor or substitution thereof) shall not bear
the Private Placement Legend.
(2) Global Security Legend. To the extent required by the
Depositary, each Global Security shall bear legends in substantially
the following forms:
"THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.5 OF THE
INDENTURE, (2) THIS GLOBAL MAY BE EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 2.5(a) OF THE INDENTURE, (3) THIS GLOBAL SECURITY
MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.7 OF THE INDENTURE AND (4) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS."
"UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE
BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR 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. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"), TO THE ISSUERS
OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN."
(3) Reg S Temporary Global Security Legend. To the extent
required by the Depositary, each Reg S Temporary Global Security shall
bear a legend in substantially the following form:
37
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL SECURITY,
AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE
SECURITIES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S
TEMPORARY GLOBAL SECURITY SHALL BE ENTITLED TO RECEIVE CASH PAYMENTS OF
INTEREST DURING THE PERIOD WHICH SUCH HOLDER HOLDS THIS SECURITY.
NOTHING IN THIS LEGEND SHALL BE DEEMED TO PREVENT INTEREST FROM
ACCRUING ON THIS SECURITY."
(h) Cancellation and/or Adjustment of Global Securities. At such time
as all beneficial interests in a particular Global Security have been exchanged
for Definitive Securities or a particular Global Security has been redeemed,
repurchased or cancelled in whole and not in part, each such Global Security
shall be returned to or retained and cancelled by the Trustee in accordance with
Section 2.7 hereof. At any time prior to such cancellation, if any beneficial
interest in a Global Security is exchanged for or transferred to a Person who
will take delivery thereof in the form of a beneficial interest in another
Global Security or for Definitive Securities, the principal amount of Securities
represented by such Global Security shall be reduced accordingly and an
endorsement may be made on such Global Security 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
Security, such other Global Security shall be increased accordingly and an
endorsement may be made on such Global Security by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the
Issuers shall execute and the Trustee shall authenticate Global
Securities and Definitive Securities upon receipt of authentication
instructions from the Issuers in accordance with this Indenture.
(2) No service charge shall be made to a holder of a
beneficial interest in a Global Security or to a Holder of a Definitive
Security for any registration of transfer or exchange, but the Issuers
may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith.
(3) The Registrar shall not be required to register the
transfer of or exchange any Security selected for redemption in whole
or in part, except the unredeemed portion of any Security being
redeemed in part.
(4) All Global Securities and Definitive Securities issued
upon any registration of transfer or exchange of Global Securities or
Definitive Securities shall be the valid obligations of the Issuers,
evidencing the same Indebtedness, and entitled to the same benefits
under this Indenture, as the Global Securities or Definitive Securities
surrendered upon such registration of transfer or exchange.
(5) The Issuers shall not be required (A) to issue, to
register the transfer of or to exchange any Securities during a period
beginning at the opening of business 15 days before the day of any
selection of Securities for redemption under Article Eleven hereof and
ending at the close of business on the day of selection, (B) to
register the transfer of or to exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any
38
Security being redeemed in part or (C) to register the transfer of or
to exchange a Security between a record date and the next succeeding
interest payment date.
(6) Prior to due presentment for the registration of a
transfer of any Security, the Trustee, any Agent and the Issuers may
deem and treat the Person in whose name any Security is registered as
the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Securities and for all
other purposes, and none of the Trustee, any Agent or the Issuers shall
be affected by notice to the contrary.
(7) The Trustee shall authenticate Global Securities and
Definitive Securities in accordance with the provisions of Section 2.2
hereof.
(8) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.5
to effect a registration of transfer or exchange may be submitted by
facsimile.
Notwithstanding anything herein to the contrary, as to any
certifications and certificates delivered to the Registrar pursuant to this
Section 2.5, the Registrar's duties shall be limited to confirming that any such
certifications and certificates delivered to it are in the form of Exhibits A
and B attached hereto. The Registrar shall not be responsible for confirming the
truth or accuracy of representations made in any such certifications or
certificates.
SECTION 2.6 Mutilated, Defaced, Destroyed, Lost and Stolen Securities.
In case any temporary or definitive Security shall become mutilated, defaced or
be apparently destroyed, lost or stolen, the Issuers in their discretion may
execute, and upon the written request of any officer of an Issuer, the Trustee
shall authenticate and deliver, a new Security, bearing a number not
contemporaneously outstanding, in exchange and substitution for the mutilated or
defaced Security, or in lieu of and substitution for the Security so apparently
destroyed, lost or stolen. In every case the applicant for a substitute Security
shall furnish to the Issuers and to the Trustee and any agent of the Issuers or
the Trustee such security or indemnity as may be required by them to indemnify,
and defend and to save each of them harmless and, in every case of destruction,
loss or theft evidence to their satisfaction of the apparent destruction, loss
or theft of such Security and of the ownership thereof.
Upon the issuance of any substitute Security, the Issuers may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Trustee) connected therewith. In case any Security
which has matured or is about to mature, or has been called for redemption in
full, shall become mutilated or defaced or be apparently destroyed, lost or
stolen, the Issuers may, instead of issuing a substitute Security, pay or
authorize the payment of the same (without surrender thereof except in the case
of a mutilated or defaced Security), if the applicant for such payment shall
furnish to the Issuers and to the Trustee and any agent of the Issuers or the
Trustee such security or indemnity as any of them may require to save each of
them harmless from all risks, however remote, and, in every case of apparent
destruction, loss or theft, the applicant shall also furnish to the Issuers and
the Trustee and any agent of the Issuers or the Trustee evidence to their
satisfaction of the apparent destruction, loss or theft of such Security and of
the ownership thereof.
Every substitute Security issued pursuant to the provisions of this
Section by virtue of the fact that any Security is apparently destroyed, lost or
stolen shall constitute an additional contractual obligation of the Issuers,
whether or not the apparently destroyed, lost or stolen Security shall be at any
time enforceable by anyone and shall be entitled to all the benefits of (but
shall be subject to all the
39
limitations of rights set forth in) this Indenture equally and proportionately
with any and all other Securities duly authenticated and delivered hereunder.
All Securities shall be held and owned upon the express condition that, to the
extent permitted by law, the foregoing provisions are exclusive with respect to
the replacement or payment of mutilated, defaced or apparently destroyed, lost
or stolen Securities and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.7 Cancellation of Securities; Destruction Thereof. All
Securities surrendered for payment, redemption, registration of transfer or
exchange, if surrendered to the Issuers or any agent of the Issuers or the
Trustee, shall be delivered to the Trustee for cancellation or, if surrendered
to the Trustee, shall be cancelled by it; and no Securities shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee shall destroy cancelled Securities held by it and deliver
a certificate of destruction to the Issuers. If the Issuers shall acquire any of
the Securities, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Securities unless and until
the same are delivered to the Trustee for cancellation.
SECTION 2.8 Temporary Securities. Pending the preparation of definitive
Securities, the Issuers may execute and the Trustee shall authenticate and
deliver temporary Securities (printed, lithographed, typewritten or otherwise
reproduced, in each case in form satisfactory to the Trustee). Temporary
Securities shall be issuable as registered Securities without coupons of any
authorized denomination, and substantially in the form of the definitive
Securities but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Issuers
with the concurrence of the Trustee. Temporary Securities may contain such
reference to any provisions of this Indenture as may be appropriate. Every
temporary Security shall be executed by the Issuers and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Securities. Without unreasonable delay the
Issuers shall execute and shall furnish definitive Securities and thereupon
temporary Securities may be surrendered in exchange therefor without charge at
each office or agency to be maintained by the Issuers for the purpose pursuant
to Section 3.2, and the Trustee shall authenticate and deliver in exchange for
such temporary Securities a like aggregate principal amount of definitive
Securities of authorized denominations. Until so exchanged the temporary
Securities shall be entitled to the same benefits under this Indenture as
definitive Securities.
SECTION 2.9 Issuance of Additional Securities. The Issuers may, subject
to Section 3.11 hereof and applicable law, issue Additional Securities under
this Indenture in an aggregate principal amount not to exceed $50,000,000. The
Initial Securities and any Additional Securities subsequently issued shall be
treated as a single class for all purposes under this Indenture.
ARTICLE THREE
COVENANTS OF THE ISSUERS AND THE TRUSTEE
SECTION 3.1 Payment of Principal and Interest. The Issuers jointly and
severally covenant and agree that they will duly and punctually pay or cause to
be paid the principal of, and interest on each of the Securities at the place or
places at the respective times and in the manner provided in the Securities.
Each installment of interest on the Securities may, at the option of the
Issuers, be paid by wire transfer or by check mailed to the holders of
Securities entitled thereto as they shall appear on the registry books of the
Issuers.
40
SECTION 3.2 Offices for Payments, etc. So long as any of the Securities
remain outstanding, the Issuers will maintain the following: (a) an office or
agency where the Securities may be presented for payment, (b) an office or
agency where the Securities may be presented for registration of transfer and
for exchange (the "Registrar") as in this Indenture provided and (c) an office
or agency where notices and demands to or upon the Issuers in respect of the
Securities or of this Indenture may be served. The Issuers will give to the
Trustee written notice of the location of any such office or agency and of any
change of location thereof. The Issuers hereby initially designate the Corporate
Trust Office of the Trustee as the office or agency for each such purpose. In
case the Issuers shall fail to maintain any such office or agency or shall fail
to give such notice of the location or of any change in the location thereof,
presentations and demands may be made and notices may be served at the Corporate
Trust Office.
SECTION 3.3 Appointment to Fill a Vacancy in Office of Trustee. The
Issuers, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 5.9, a Trustee, so that there
shall at all times be a Trustee hereunder.
SECTION 3.4 Paying Agents. Whenever the Issuers shall appoint a paying
agent other than the Trustee, it will cause such paying agent to execute and
deliver to the Trustee an instrument in which such agent shall agree with the
Trustee, subject to the provisions of this Section,
(a) that it will hold all sums received by it as such agent
for the payment of the principal of or interest on the Securities
(whether such sums have been paid to it by the Issuers or by any other
obligor on the Securities) in trust for the benefit of the holders of
the Securities or of the Trustee,
(b) that it will give the Trustee notice of any failure by the
Issuers (or by any other obligor on the Securities) to make any payment
of the principal of or interest on the Securities when the same shall
be due and payable, and
(c) that it will pay any such sums so held in trust by it to
the Trustee upon the Trustee's written request at any time during the
continuance of the failure referred to in clause (b) above.
The Issuers will, on or prior to each due date of the principal of or
interest on the Securities, deposit with the paying agent a sum sufficient to
pay such principal or interest, and (unless such paying agent is the Trustee)
the Issuers will promptly notify the Trustee of any failure to take such action.
If either Issuer shall act as paying agent, it will, on or before each
due date of the principal of or interest on the Securities, set aside, segregate
and hold in trust for the benefit of the holders of the Securities a sum
sufficient to pay such principal or interest so becoming due. The Issuers will
promptly notify the Trustee of any failure to take such action.
Anything in this Section to the contrary notwithstanding, the Issuers
may at any time, for the purpose of obtaining a satisfaction and discharge of
this Indenture or for any other reason, pay or cause to be paid to the Trustee
all sums held in trust by the Issuers or any paying agent hereunder, as required
by this Section, such sums to be held by the Trustee upon the trusts herein
contained.
Anything in this Section to the contrary notwithstanding, the agreement
to hold sums in trust as provided in this Section are subject to the provisions
of Sections 9.3 and 9.4.
SECTION 3.5 Certificates to Trustee. The Issuers will, so long as any
of the Securities are outstanding:
41
(a) deliver to the Trustee, forthwith upon becoming aware of
any default or defaults in the performance of any covenant, agreement
or condition contained in this Indenture (including notice of any event
of default which with the giving of notice and lapse of time would
become an Event of Default under Section 4.1 hereof), an Officers'
Certificate specifying such default or defaults and what action the
issuers are taking or propose to take with respect thereto; and
(b) deliver to the Trustee within 120 days after the end of
each fiscal year of the Issuers beginning with the fiscal year ending
December 31, 2002, an Officers' Certificate in compliance with Section
314(a)(4) of the Trust Indenture Act of 1939.
SECTION 3.6 Securityholder Lists. If and so long as the Trustee shall
not be the Security Registrar, the Issuers will furnish or cause to be furnished
to the Trustee a list in such form as the Trustee may reasonably require of the
names and addresses of the holders of the Securities pursuant to Section 312 of
the Trust Indenture Act (a) semi-annually not more than 15 days after each
record date for the payment of semi-annual interest on the Securities, as
hereinabove specified, as of such record date, and (b) at such other times as
the Trustee may request in writing, within thirty days after receipt by the
Issuers of any such request as of a date not more than 15 days prior to the time
such information is furnished.
SECTION 3.7 Reports by the Issuers. The Issuers jointly and severally
covenant and agree to:
(a) file with the Commission and, within 15 days after either
Issuer is required to file the same with the Commission, with the
Trustee copies of the annual reports and of the information, documents
and other reports which either Issuer may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act
and, if neither Issuer is required to file such information, documents
or reports with the Commission, to file with the Commission and the
Trustee the same such information, documents or reports as if either
Issuer were so subject;
(b) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information. documents and reports with
respect to compliance by the Issuers with the conditions and covenants
provided for in this Indenture as may be required from time to time by
such rules and regulations; and
(c) transmit by mail to the Holders of Securities, within 30
days after the filing thereof with the Trustee, any information,
documents and reports required to be filed by the Issuers with the
Trustee pursuant to (a) and (b) of this Section 3.7.
SECTION 3.8 Reports by the Trustee. Within 60 days after May 15 of each
year, beginning May 15, 2002, for so long as any Securities are outstanding
hereunder, the Trustee shall transmit by mail to all Securityholders, as their
names and addresses appear in the registry books, in the manner and to the
extent provided in Section 313(c) of the Trust Indenture Act of 1939, a brief
report dated as of such May 15 if required by and in compliance with Section
313(a) of the Trust Indenture Act of 1939.
SECTION 3.9 Limitation on Restricted Payments. Subject to the other
provisions of this Section 3.9, each Issuer shall not and shall not permit any
of its Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any distribution on
account of the Capital Stock or other Equity Interests of such Issuer
or any Subsidiary of Advantica or Denny's Holdings ((i) other than
dividends or distributions payable in Equity Interests (other than
Disqualified
42
Stock) of such Issuer or such Subsidiary and (ii) other than dividends
or distributions payable by a Subsidiary (other than dividends or
distributions payable by any of the Denny's Holdings Group to any of
the Advantica Group) so long as, in the case of any dividend or
distribution payable on any class or series of securities issued by a
Subsidiary other than a wholly owned Subsidiary, such Issuer or a
Subsidiary of such Issuer receives at least its pro rata share of such
dividend or distribution in accordance with its Equity Interest in such
class or series of securities);
(b) purchase, redeem or otherwise acquire or retire for value
any Equity Interests of such Issuer or any Subsidiary of Advantica or
Denny's Holdings (other than any such Equity Interests (i) owned by
Advantica or any of its Subsidiaries so purchased, redeemed or
otherwise acquired or retired for value by any of the Advantica Group
and (ii) owned by any of the Denny's Holdings Group so purchased,
redeemed or otherwise acquired or retired for value by any of the
Denny's Holdings Group);
(c) voluntarily prepay any Old Notes or any Indebtedness that
is subordinated to the Securities other than in connection with any (i)
refinancing of such Indebtedness specifically permitted pursuant to
Section 3.11(c), (ii) Indebtedness between (x) Advantica and any of its
Subsidiaries in the Advantica Group or between Subsidiaries in the
Advantica Group, (y) Denny's Holdings and any of its Subsidiaries in
the Denny's Holdings Group or between Subsidiaries in the Denny's
Holdings Group or (iii) Indebtedness of any of the Advantica Group to
any of the Denny's Holdings Group; or
(d) make any Restricted Investments (other than an Investment
in any Unrestricted Subsidiary)
(all such dividends, distributions, purchases, redemptions or other
acquisitions, retirements, prepayments or Restricted Investments being
collectively referred to as "Restricted Payments"), if, at the time of such
Restricted Payment:
(i) a Default or Event of Default shall have occurred
and be continuing or shall occur as a consequence thereof;
(ii) immediately after such Restricted Payment and
after giving effect thereto on a pro forma basis, Advantica
would not be able to incur $1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in
Section 3.11(a); or
(iii) such Restricted Payment, without duplication,
together with (A) the aggregate of all other Restricted
Payments (in each case valued, where other than cash, at their
fair market value as of the date such Restricted Payment is
made) made after the date hereof and (B) the amount by which
the aggregate of all then outstanding Investments in
Unrestricted Subsidiaries (other than the FRD Investment),
calculated without giving effect to amounts included pursuant
to clause (z)(2) below, exceeds $25 million, is greater than
the sum of, without duplication: (v) 50% of the aggregate
Consolidated Net Income of Denny's Holdings for the period
(taken as one accounting period) from the beginning of the
first quarter immediately after the date hereof to the end of
its most recently ended fiscal quarter at the time of such
Restricted Payment; provided that, if such Consolidated Net
Income for such period is less than zero, then minus 100% of
the amount of such loss, plus (w) 100% of the aggregate
amortization of
43
goodwill and of excess reorganization value for the period
specified in clause (v) above, plus (x) 100% of the aggregate
net cash proceeds and the fair market value of marketable
securities received by Denny's Holdings from the issue or
sale, after the date hereof, of Capital Stock of Denny's
Holdings (other than Capital Stock issued and sold to a
Subsidiary of Denny's Holdings and other than Disqualified
Stock), or any Indebtedness or other security convertible into
any such Capital Stock that has been so converted plus (y)
100% of the aggregate amounts contributed to the capital of
Denny's Holdings after the date hereof plus (z) 100% of the
aggregate amounts received in cash and the fair market value
of marketable securities (other than Restricted Investments)
received from (1) the sale or other disposition of Restricted
Investments made after the date hereof by Denny's Holdings and
its Subsidiaries or (2) the sale of the stock of an
Unrestricted Subsidiary or the sale of all or substantially
all of the assets of an Unrestricted Subsidiary to the extent
that a liquidating dividend is paid to Denny's Holdings or any
Subsidiary of Denny's Holdings from the proceeds of such sale
(in each case, other than to the extent of the FRD Investment
and only to the extent that such amounts were not applied to
reduce the aggregate amount of all outstanding Investments in
Unrestricted Subsidiaries for purposes of calculating the
aggregate amount of all such Investments in (B) above);
provided that no such amounts shall be included pursuant to
clause (x) or (y) above to the extent that the proceeds
(including by exchange) from any such issuance, sale or
contribution were used as provided in clause (2), (4) or (5)
in the next succeeding paragraph.
For purposes of clause (iii) above, the fair market value of property other than
cash shall be conclusively determined in good faith by the Board of Directors of
Denny's Holdings.
The provisions of this Section 3.9 shall not prohibit:
(1) the payment of any dividend within 60 days after the date
of declaration thereof, if at said date of declaration such payment
would have complied with the provisions hereof;
(2) the retirement of any shares of Capital Stock of an Issuer
in exchange for, or out of the net proceeds of the substantially
concurrent sale (other than to a Subsidiary of such Issuer) of, other
shares of such Issuer's Capital Stock, other than any Disqualified
Stock;
(3) payments for the repurchase, redemption or other
acquisition or retirement for value of any Equity Interests in
Advantica issued to members of management of Advantica and its
Subsidiaries pursuant to subscription and option agreements in effect
on the date hereof and Equity Interests in Advantica issued to future
members of management pursuant to subscription agreements executed
subsequent to the date hereof, containing provisions for the repurchase
of such Equity Interests upon death, disability or termination of
employment of such persons which are substantially identical to those
contained in the subscription agreements in effect on the date hereof;
provided that the amount of such dividends or distributions, after the
date hereof, in the aggregate will not exceed the sum of (A) $5,000,000
plus (B) the cash proceeds from any reissuance of such Equity Interests
by Advantica to members of management of Advantica and its
Subsidiaries;
(4) the repurchase, redemption or other acquisition or
retirement for value of any Indebtedness of an Issuer that is
subordinated in right of payment to the Securities in exchange for or
with the proceeds of the issuance of shares of such Issuer's Equity
Interests (other than Disqualified Stock);
44
(5) the redemption, repurchase or retirement for value of any
Indebtedness of an Issuer that is subordinated to the Securities (A)
with the proceeds of, or in exchange for, Indebtedness incurred
pursuant to Section 3.11(c) or (B) if, after giving effect to such
redemption, repurchase or retirement, Advantica could incur at least
$1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage
Ratio test set forth in Section 3.11(a);
(6) the purchase, redemption or other acquisition or
retirement for value of Equity Interests of any Subsidiary of Advantica
(other than any such Equity Interests (i) owned by Advantica or any of
its Subsidiaries so purchased, redeemed or otherwise acquired or
retired for value by any of the Advantica Group and (ii) owned by any
of the Denny's Holdings Group so purchased, redeemed or otherwise
acquired or retired for value by any of the Denny's Holdings Group) in
an aggregate cumulative amount not to exceed $5,000,000 annually;
(7) so long as no Default or Event of Default shall have
occurred and be continuing, Permitted Payments to Advantica; and
(8) after the date on which a bankruptcy court enters an order
closing the FRD Chapter 11 Case, the repurchase, redemption or other
acquisition or retirement for value of Old Notes by Advantica for
consideration in an aggregate amount not to exceed $50,000,000;
provided, however, that no Default or Event of Default shall have
occurred and be continuing at the time of any such repurchase,
redemption or other acquisition or retirement;
provided, that in determining the aggregate amount expended for Restricted
Payments in accordance with clause (iii) of the first paragraph of this Section
3.9, (x) no amounts expended under clauses (2), (4), or (5) of this paragraph
shall be included, (y) 100% of the amounts expended under clauses (3), (6), (7)
and (8) of this paragraph shall be included, and (z) 100% of the amounts
expended under clause (1), to the extent not included under subclauses (x) or
(y) of this proviso, shall be included.
SECTION 3.10 Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries. Each Issuer shall not, and shall not permit any of its
Subsidiaries (other than nonconsolidated subsidiaries) to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction on the ability of any such Subsidiary to
(a) pay dividends or make any other distributions on its Capital Stock or any
other interest or participation in, or measured by, its profits, owned by an
Issuer or any of its Subsidiaries or pay any Indebtedness owed to an Issuer or
any of its Subsidiaries, (b) make loans or advances to an Issuer or any of its
Subsidiaries or (c) transfer any of its properties or assets to an Issuer or any
of its Subsidiaries, except in each case for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this Indenture, (iii)
the Credit Agreement or any other agreement entered into in connection therewith
or as contemplated thereby, (iv) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of an Issuer or any of
its Subsidiaries, (v) any instrument governing Indebtedness of a person acquired
by an Issuer or any of its Subsidiaries at the time of such acquisition;
provided that such Indebtedness is not incurred in connection with or in
contemplation of such acquisition, (vi) the Old Notes, Existing Indebtedness or
other contractual obligation of an Issuer or any of its Subsidiaries existing on
the date hereof, (vii) additional Indebtedness in an aggregate principal amount
of up to $50,000,000 at any one time outstanding, (viii) any amendment,
modification, renewal, extension, replacement, refinancing or refunding of
encumbrances or restrictions imposed pursuant to clauses (ii), (iii), (vi) or
(vii) above; provided that the restrictions contained in any such amendment,
modification, renewal, extension, replacement, refinancing or refunding are no
less favorable in all material respects to the Holders of the Securities, (ix)
any Mortgage Financing or Mortgage Refinancing, (x) any Permitted Investment or
45
(xi) contracts for the sale of assets so long as such encumbrances or
restrictions apply only to the assets to be sold pursuant thereto.
SECTION 3.11 Limitation on Additional Indebtedness and Issuance of
Disqualified Stock.
(a) Subject to the other provisions of this Section 3.11,
(x) each Issuer shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, issue, assume
or guarantee any Indebtedness (other than (A) Indebtedness (a) owing
from any of the Denny's Holdings Group payable to any of the Advantica
Group; (b) between Denny's Holdings and a Subsidiary of Denny's
Holdings; (c) between Subsidiaries of Denny's Holdings; (d) between
Advantica and a Subsidiary of Advantica in the Advantica Group; or (e)
between Subsidiaries of the Advantica Group; and (B) guarantees by
Advantica or any Subsidiary of Advantica of Indebtedness of any of the
Denny's Holdings Group or guarantees by any Subsidiary in the Advantica
Group of Indebtedness of any of the Advantica Group) and
(y) neither Issuer shall issue any Disqualified Stock,
unless (i) such Indebtedness or Disqualified Stock is either Acquisition
Indebtedness or is created, incurred, issued, assumed or guaranteed by such
Issuer and not a Subsidiary of such Issuer and (ii) Advantica's Fixed Charge
Coverage Ratio for the four full fiscal quarters last preceding the date such
additional Indebtedness is created, incurred, assumed or guaranteed, or such
additional stock is issued, would have been at least 2.25:1, determined on a pro
forma basis (including a pro forma application of the net proceeds of such
Indebtedness or such issuance of stock) as if the additional Indebtedness had
been created, incurred, assumed or guaranteed, or such additional stock had been
issued, at the beginning of such four-quarter period.
The limitations of this Section 3.11(a) shall not apply to the
incurrence by an Issuer or any of its Subsidiaries of any Indebtedness pursuant
to the Credit Agreement; provided, however, that the principal amount of such
Indebtedness incurred and outstanding at any time pursuant to the Credit
Agreement (including any Indebtedness incurred to refund or refinance such
Indebtedness) for this purpose shall not exceed the greater of $250,000,000 and
the aggregate amount of the commitments under the Credit Agreement on the date
hereof.
(b) The limitations of Section 3.11(a) hereof notwithstanding,
Advantica or any of its Subsidiaries may create, incur, issue, assume or
guarantee Indebtedness pursuant to the Credit Agreement or otherwise, (i) in
connection with or arising out of Mortgage Financings, Mortgage Refinancings and
sale and lease-back transactions; provided that the Mortgage Financing Proceeds,
Mortgage Refinancing Proceeds (excluding any Mortgage Refinancing Proceeds
received in connection with any refinancing of any Indebtedness secured by a
mortgage or Lien on the Excluded Property) or Net Proceeds, as the case may be,
incurred, assumed or created in connection therewith are used to pay any
outstanding Senior Indebtedness, and provided further that any amounts used to
repay Indebtedness outstanding under the Old Notes shall be applied only as and
when permitted under Section 3.9, (ii) constituting purchase money obligations
for property acquired in the ordinary course of business or other similar
financing transactions (including, without limitation, in connection with
Mortgage Financings and Mortgage Refinancings as and to the extent permitted in
clause (i) above); provided that, in the case of Indebtedness exceeding
$2,000,000 for any such obligation or transaction, such Indebtedness exists at
the date of the purchase or transaction or is created within 180 days
thereafter, (iii) constituting capital lease obligations, (iv) constituting
reimbursement obligations with respect to letters of credit, including,
46
without limitation, letters of credit in respect of workers' compensation claims
issued for the account of an Issuer or a Subsidiary of an Issuer in the ordinary
course of its business, or other Indebtedness with respect to reimbursement type
obligations regarding workers' compensation claims, (v) constituting additional
Indebtedness in an aggregate principal amount (including any Indebtedness
incurred to refund or refinance such Indebtedness) of up to $50,000,000 at any
one time outstanding, whether incurred under the Credit Agreement or otherwise,
(vi) constituting Indebtedness secured by the Excluded Property, and (vii)
constituting Existing Indebtedness and permitted refinancings thereof in
accordance with Section 3.11(c);
(c) The limitations of Section 3.11(a) hereof notwithstanding, an
Issuer or any Subsidiary of an Issuer may create, incur, issue, assume or
guarantee any Indebtedness that serves to refund, refinance or restructure the
Securities, Existing Indebtedness or any other Indebtedness incurred as
permitted hereunder, or any Indebtedness issued to so refund, refinance or
restructure such Indebtedness, in an amount equal to or less than the
Indebtedness being so refunded, refinanced or restructured, including additional
Indebtedness incurred to pay premiums and fees in connection therewith
("Refinancing Indebtedness"), prior to its respective maturity; provided,
however, that such Refinancing Indebtedness is incurred by the obligor on the
Indebtedness being refinanced and (i) bears an interest rate per annum that is
equal to or less than the interest rate per annum then payable under such
Indebtedness being refunded or refinanced (calculated in accordance with any
formula set forth in the documents evidencing any such Indebtedness) unless such
Refinancing Indebtedness is incurred, created or assumed within twelve months of
the scheduled maturity of the Indebtedness being refinanced, (ii) has a Weighted
Average Life to Maturity at the time such Refinancing Indebtedness is incurred
which is not less than the remaining Weighted Average Life to Maturity of such
Indebtedness being refunded or refinanced, and (iii) to the extent such
Refinancing Indebtedness refinances Indebtedness subordinated to the Securities,
such Refinancing Indebtedness is subordinated to the Securities at least to the
same extent as the Indebtedness being refinanced or refunded, and provided
further that clauses (i), (ii) and (iii) of this clause (c) will not apply to
any refunding or refinancing of any Senior Indebtedness; and
(d) The limitations of Section 3.11(a) hereof notwithstanding, any
nonconsolidated subsidiary of an Issuer created after the date hereof may
create, incur, issue, assume, guarantee or otherwise become liable with respect
to any additional Indebtedness; provided that such Indebtedness is nonrecourse
to any Issuer and its consolidated Subsidiaries, and the Issuers and their
consolidated Subsidiaries have no liability with respect to such additional
Indebtedness.
SECTION 3.12 Limitation on Transactions with Affiliates. Each Issuer
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, enter into any transaction with any Affiliate (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service) involving aggregate consideration in excess of
$5,000,000 for any one transaction, except for (1) transactions (including any
investments, loans or advances by or to any Affiliate) in good faith the terms
of which are fair and reasonable to such Issuer or Subsidiary, as the case may
be, and are at least as favorable as the terms that could be obtained by such
Issuer or Subsidiary, as the case may be, in a comparable transaction made on an
arm's length basis between unaffiliated parties (in each case as conclusively
determined by a majority of the Board of Directors of Advantica or Denny's
Holdings, as applicable, unaffiliated with such Affiliate or, if there are no
such directors, as conclusively determined by a majority of the Board of
Directors of Advantica or Denny's Holdings, as applicable), (2) transactions in
which such Issuer or any of its Subsidiaries, as the case may be, delivers to
the holders of the Securities a written opinion of a nationally recognized
investment banking firm stating that such transaction is fair to such Issuer or
Subsidiary, as the case may be, from a financial point of view, (3) transactions
between such Issuer and its Subsidiaries or between Subsidiaries of such Issuer
that are not otherwise prohibited by Section 3.9 and (4) payments or loans to
employees or consultants pursuant to
47
employment or consultancy contracts which are approved by the Board of Directors
of Advantica or Denny's Holdings, as applicable, in good faith.
SECTION 3.13 Limitation on Sale of Assets.
(a) Neither Issuer nor any of their respective Subsidiaries (other than
nonconsolidated Subsidiaries) shall (A) (I) sell, lease, convey or otherwise
dispose of, in any transaction or group of transactions that are a part of a
common plan, all or substantially all of the assets or Capital Stock of any
Asset Segment (provided that the sale, lease, conveyance or other disposition of
all or substantially all of an Issuer's assets shall not be governed by this
Section 3.13 but shall be governed by the provisions of Section 8.1) or (II)
issue or sell Equity Interests of any Asset Segment (each of the foregoing, an
"Asset Sale") or (B) sell, lease, convey or otherwise dispose of any Business
Segment, unless in each case, such Issuer shall apply the Net Proceeds from such
Asset Sale or such sale, lease, conveyance or other disposition of a Business
Segment to one or more of the following in such combination as such Issuer may
choose: (i) an Investment in another asset or business in the same line of
business as, or a line of business similar to that of, the line of business of
Advantica and its Subsidiaries (other than in the case of any Asset Sale of an
Asset Segment in any of the Denny's Holdings Group or any sale, lease,
conveyance or other disposition of any Business Segment in any of the Denny's
Holdings Group, any Investment by any of the Denny's Holdings Group in any of
the Advantica Group) and such Investment occurs within 366 days of such Asset
Sale or such sale, lease, conveyance or other disposition of a Business Segment,
(ii) a Net Proceeds Offer (defined below) expiring within 366 days of such Asset
Sale or such sale, lease, conveyance or other disposition of a Business Segment
or (iii) the purchase, redemption or other prepayment or repayment of
outstanding Senior Indebtedness within 366 days of such Asset Sale or such sale,
lease, conveyance or other disposition of a Business Segment, provided that any
amounts used to repay Indebtedness outstanding under the Old Notes shall be
applied only as and when permitted under Section 3.9 hereof; provided, however,
that if the net amount not invested pursuant to clause (i) above or applied
pursuant to clause (iii) above is less than $15,000,000, such Issuer shall not
be further obligated to offer to repurchase Securities pursuant to clause (ii)
above. Notwithstanding the foregoing, the receipt of all proceeds of insurance
paid on account of the loss of or damage to any Business Segment and awards of
compensation for any such Business Segment taken by condemnation or eminent
domain which result in net proceeds to such Issuer of $50,000,000 or more
(excluding proceeds to be used for replacement of such Business Segment,
provided that the Trustee has received notice from such Issuer within 90 days of
such receipt of its intention to use such proceeds for such purpose) will be
deemed an "Asset Sale." Notwithstanding anything herein to the contrary, the
following will not be deemed an "Asset Sale" or a sale or other disposition of a
Business Segment: (1) Permitted Investments, (2) sales, leases, conveyances or
other dispositions of assets by (x) any of the Advantica Group to Advantica or
any of its wholly owned Subsidiaries or (y) any of the Denny's Holdings Group to
Denny's Holdings, or (3) a Public Offering of any Subsidiary of Advantica, but
only to the extent that the proceeds of which are used to redeem up to 35% of
the aggregate principal amount of Securities as provided in Section 11.1.
(b) For purposes of subsection (ii) of Section 3.13(a), the Issuers
shall apply the Net Proceeds of the Asset Sale or the sale, lease, conveyance or
other disposition of a Business Segment to make a tender offer in accordance
with applicable law (a "Net Proceeds Offer") to repurchase Securities at a price
not less than 100% of the principal amount thereof, plus accrued and unpaid
interest. Any Net Proceeds Offer shall be made by the Issuers only if and to the
extent permitted under, and subject to prior compliance with, the terms of any
agreement governing Senior Indebtedness. If on the date any Net Proceeds Offer
is commenced, securities of an Issuer ranking pari passu in right of payment
with the Securities are at the time outstanding, and the terms of such
securities provide that an offer to repurchase such securities similar to the
Net Proceeds Offer is to be made with respect thereto, then the Net Proceeds
Offer for the Securities shall be made concurrently with such other offer, and
securities of each
48
issue shall be accepted on a pro rata basis, in proportion to the aggregate
principal amount of securities of each issue which the holders of securities of
such issue elect to have repurchased. After the last date on which holders of
the Securities are permitted to tender their Securities in a Net Proceeds Offer,
the Issuer that originally received the Net Proceeds shall not be restricted
under this Section 3.13 as to its use of any Net Proceeds available to make such
Net Proceeds Offer (up to the amount of Net Proceeds that would have been used
to repurchase Securities assuming 100% acceptance of the Net Proceeds Offer) but
not used to repurchase Securities pursuant thereto.
(c) Notwithstanding any provision hereof to the contrary, for a period
of 120 days after the last date on which holders of the Securities are permitted
to tender their Securities in the Net Proceeds Offer, the Issuer that originally
received the Net Proceeds may use any Net Proceeds available to make such Net
Proceeds Offer but not used to repurchase Securities pursuant thereto to
purchase, redeem or otherwise acquire or retire for value any securities of such
Issuer ranking junior in right of payment to the Securities at a price, stated
as a percentage of the principal or face amount of such junior securities, not
greater than the price, stated as a percentage of the principal amount of the
Securities, offered in the Net Proceeds Offer; provided that, if the Net
Proceeds Offer is for a principal amount (the "Net Proceeds Offer Amount") of
the Securities less than the aggregate principal amount of the Securities then
outstanding, then the Net Proceeds available for use by such Issuer for such a
purchase, redemption or other acquisition or retirement for value of junior
securities shall not exceed the Net Proceeds Offer Amount.
(d) An offer to repurchase Securities pursuant to this Section 3.13
shall be made pursuant to the provisions of Section 11.5 hereof. Simultaneously
with the notification of such offer of redemption to the Trustee as required by
Section 11.5 hereof, the Issuers shall provide the Trustee with an Officers'
Certificate setting forth the information required to be included therein by
Section 10.5 hereof and, in addition, setting forth the calculations used in
determining the amount of Net Proceeds to be applied to the redemption of
Securities.
(e) In the event that an Issuer shall make any payment of Net Proceeds
to the Trustee which, to the actual knowledge of a trust officer of the Trustee,
should properly have been made to holders or to the representative of the
holders of any Senior Indebtedness for the prepayment or repayment of such
Senior Indebtedness pursuant to the provisions of this Sectin 3.13, such payment
shall be held by the Trustee for the benefit of, and, upon written request of
the holders of such Senior Indebtedness or their representative, shall be paid
forthwith over and delivered to, the holders of such Senior Indebtedness or
their representative for application in accordance with the provisions of this
Section 3.13. With respect to the holders of such Senior Indebtedness, the
Trustee undertakes to perform only such obligations on the part of the Trustee
as are specifically set forth in this Section 3.13(e), and no implied covenants
or obligations with respect to the holders of such Senior Indebtedness shall be
read into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of such Senior Indebtedness. If Net
Proceeds are received by Holders which, pursuant to the provisions of this
Section 3.13, should properly have been received by the holders of such Senior
Indebtedness or their representative for the prepayment or repayment of such
Senior Indebtedness, the Holders who receive such Net Proceeds shall hold such
Net Proceeds in trust for, and pay such Net Proceeds over to, the holders of
such Senior Indebtedness or their representative.
SECTION 3.14 Corporate Existence. Subject to Article 8 hereof and other
than as permitted by the Credit Agreement, each Issuer shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate, partnership or other existence of each
Significant Subsidiary in accordance with the respective organizational
documents as they may be from time to time amended of each Issuer and each such
Subsidiary and the rights (charter and statutory),
49
governmental licenses and governmental franchises of each Issuer and its
Subsidiaries; provided, however, that neither Issuer shall be required to
preserve any such right, license or franchise or the corporate, partnership or
other existence of any such Subsidiary, if the preservation thereof is no longer
necessary in the conduct of the business of such Issuer and its Subsidiaries
taken as a whole and the loss thereof is not adverse in any material respect to
the Holders (which determination, if made in good faith by the Board of
Directors of such Issuer, shall be conclusive).
SECTION 3.15 Limitation on Liens.
(a) Each Issuer shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or suffer to exist any Lien on
any asset now owned or hereafter acquired by such Issuer or any such Subsidiary,
except with respect to:
(i) Liens securing or arising under or in connection with any
Indebtedness of an Issuer not expressly by its terms subordinate or
junior in right of payment to any other Indebtedness of such Issuer;
(ii) Liens existing on the date hereof;
(iii) Liens permitted by or required pursuant to the Credit
Agreement;
(iv) Liens relating to judgments to the extent such judgments
do not give rise to an Event of Default pursuant to Section 4.1(5);
(v) Liens arising under or in connection with Section 9.1;
(vi) Liens incurred in the ordinary course of business so long
as the Indebtedness secured by such Lien does not exceed $5,000,000 at
any one time outstanding;
(vii) Liens for taxes or assessments and similar charges
either (x) not delinquent or (y) contested in good faith by appropriate
proceedings and as to which either Issuer or a Subsidiary of either
Issuer shall have set aside on its books such reserves as may be
required pursuant to generally accepted accounting principles;
(viii) Liens incurred or pledges and deposits in connection
with workers' compensation, unemployment insurance and other social
security benefits, or securing performance bids, tenders, leases,
contracts (other than for the repayment of borrowed money), statutory
obligations, progress payments, surety and appeal bonds and other
obligations of like nature, incurred in the ordinary course of
business;
(ix) Liens imposed by law, such as mechanics', carriers',
warehousemen's, materialmen's and vendors' Liens, incurred in good
faith in the ordinary course of business;
(x) zoning restrictions, easements of licenses, covenants,
reservations, restrictions on the use of real property or minor
irregularities of title incident thereto of any of the Denny's Holdings
Group which do not in the aggregate materially detract from the value
of the property or assets of the Denny's Holdings Group, taken as a
whole, or of any of the Advantica Group which do not in the aggregate
materially detract from the
50
value of the property or assets the Advantica Group, taken as a whole,
or materially impair the operation of the business of, as applicable,
either the Denny's Holdings Group, taken as a whole, or the Advantica
Group, taken as a whole;
(xi) Liens created by Subsidiaries in the Denny's Holdings
Group to secure Indebtedness of such Subsidiaries to any of Denny's
Holdings Group or Liens created by Subsidiaries in the Advantica Group
to secure Indebtedness of such Subsidiaries to any of the Advantica
Group or the Denny's Holdings Group;
(xii) pledges of or Liens on raw materials or on manufactured
products as security for any drafts or bills of exchange in connection
with the importation of such raw materials or manufactured products in
the ordinary course of business;
(xiii) a Lien on any assets (x) securing Indebtedness incurred
or assumed pursuant to clause (ii) or (iii) or Section 3.11(b) hereof
for the purpose of financing all or any part of the cost of acquiring
such asset or construction thereof or thereon or (y) existing on assets
or businesses at the time of the acquisition thereof;
(xiv) the Lien granted to the Trustee pursuant to Section 5.6
hereof and any substantially equivalent Lien granted to the respective
trustees under the indentures for other debt securities of either
Issuer;
(xv) Liens arising in connection with any Mortgage Financing
or Mortgage Refinancing by either Issuer or any of its Subsidiaries;
(xvi) Liens securing reimbursement obligations with respect to
letters of credit issued for the account of either Issuer or any of its
Subsidiaries in the ordinary course of business;
(xvii) any Lien on the Excluded Property;
(xviii) Liens securing an interest of a landlord in real
property leases; and
(xix) Liens created in connection with the refinancing of any
Indebtedness secured by Liens permitted to be incurred or to exist
pursuant to the foregoing clauses; provided, however, that no
additional assets are encumbered by such Liens in connection with such
refinancing, unless permitted by clause (iii) above or Section 3.15(b)
hereof.
(b) Notwithstanding the provisions of paragraph (a) above, an Issuer
may create or assume any Lien upon any of its properties or assets, whether now
owned or hereafter acquired, if such Issuer shall cause the Securities to be
equally and ratably secured with any and all other Indebtedness secured by such
Lien as long as any such other Indebtedness shall be so secured; provided that
if such Lien ceases to exist, such equal and ratable Lien shall thereupon
automatically cease. Notwithstanding anything in this Indenture to the contrary,
in no event shall any Lien be incurred (i) securing Indebtedness outstanding
pursuant to the Old Notes or (ii) on any assets of the Denny's Holdings Group
securing Indebtedness of any of the Advantica Group (other than such
Indebtedness of any of the Advantica Group which is also Indebtedness of any of
the Denny's Holdings Group).
SECTION 3.16 Future Subsidiary Guarantors. Each Issuer shall not permit
any of its Subsidiaries to guarantee the payment of any Indebtedness of an
Issuer that is expressly by its terms
51
subordinate or junior in right of payment to any other Indebtedness of such
Issuer (a "Subordinated Indebtedness Guarantee"), unless (i) such Subsidiary
executes and delivers a supplemental indenture evidencing its guarantee of such
Issuer's Obligations hereunder and under the Securities on a substantially
similar basis (the "Securities Guarantee") and (ii) the Securities Guarantee is
senior in right of payment to such Subordinated Indebtedness Guarantee to the
same extent as the Securities are senior in right of payment to such junior
Indebtedness of such Issuer; provided that if such Subordinated Indebtedness
Guarantee ceases to exist for any reason, the Securities Guarantee shall
thereupon automatically cease to exist. Nothwithstanding anything herein to the
contrary, in no event shall any Subsidiary of Advantica guarantee Indebtedness
outstanding pursuant to the Old Notes.
SECTION 3.17 Investments in Unrestricted Subsidiaries. Each Issuer
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, make any Investment in any Unrestricted Subsidiary unless (i) the
amount of such Investment does not exceed the amount then permitted to be used
to make a Restricted Payment pursuant to clause (iii) of the first paragraph of
Section 3.9 and (ii) immediately after such Investment, and after giving effect
thereto on a pro forma basis deducting from Net Income the amount of any
Investment the Issuers and Subsidiaries of the Issuers have made in Unrestricted
Subsidiaries during the four full fiscal quarters last preceding the date of
such Investment, Advantica would be able to incur $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in
Section 3.11(a). Notwithstanding clauses (i) and (ii) of this Section 3.17 or
any provision hereof to the contrary, the Issuers and their Subsidiaries shall
be permitted to make investments in Unrestricted Subsidiaries in an aggregate
amount not to exceed $25,000,000 (without regard to the FRD Investment) at any
one time outstanding. The amount by which the aggregate of all Investments in
Unrestricted Subsidiaries exceeds $25,000,000 (without regard to the FRD
Investment) shall be counted in determining the aggregate permissible amount of
Restricted Payments pursuant to clause (iii) of the first paragraph of Section
3.9. Neither Issuer will permit any Unrestricted Subsidiary to become a
Subsidiary, except pursuant to the last sentence of the definition of
"Unrestricted Subsidiary."
SECTION 3.18 Offer to Redeem upon Change of Control. If at any time
(the "Change of Control Date") (i) all or substantially all of an Issuer's
assets are sold as an entirety to any person or related group of persons, (ii)
an Issuer is merged with or into another corporation or another corporation is
merged with or into an Issuer with the effect that immediately after such
transaction the stockholders of such Issuer immediately prior to such
transaction hold less than a majority in interest of the total voting power
entitled to vote in the election of directors, managers or trustees of the
person surviving such transaction, (iii) any person or related group of persons
acquires a majority in interest of the total voting power or voting stock of an
Issuer, (iv) the persons constituting the Board of Directors of Advantica on the
date hereof or persons nominated or elected to the Board of Directors of
Advantica by a majority vote of such directors (the "Continuing Directors") or
by a majority vote of the Continuing Directors do not constitute a majority of
the members of the Board of Directors of Advantica, or (v) Advantica shall cease
to own, directly or indirectly, 100% of the Equity Interests of Denny's Holdings
having ordinary voting power for the election of directors or other governing
body (each a "Change of Control"), then, in any such case, the Issuers will
notify the Holders of the Securities in writing of such occurrence and will make
an offer to purchase in accordance with the terms of this Indenture (the "Change
of Control Offer") all Securities then outstanding at a purchase price equal to
101% of the principal amount thereof, plus accrued and unpaid interest, if any,
to the repurchase date; provided, however, that such repurchase will only occur
if there has been no acceleration which has not been withdrawn or paid pursuant
to the Credit Agreement prior to the time of notice of a Change of Control
Offer. Prior to the mailing of the notice to Holders provided for above, the
Issuers will (x) to the extent then repayable or prepayable, repay in full all
Indebtedness under the Credit Agreement and, to the extent not then repayable or
prepayable, offer to repay in full all such Indebtedness and to repay the
Indebtedness of each lender under the Credit Agreement who has accepted such
offer or (y) obtain the
52
requisite consent under the Credit Agreement to permit the repurchase of the
Securities. The Issuers shall first comply with the proviso in the preceding
sentence before they shall be required to repurchase the Securities pursuant to
this Section 3.18.
The Issuers shall comply with all applicable tender offer rules
(including without limitation Rule 14e-1 under the Exchange Act, if applicable)
in the event that the repurchase option pursuant to this Section 3.18 is
triggered under the circumstances described herein. Not less than 30 or more
than 60 days following any Change of Control, the Issuers shall mail a notice to
each Holder of any Securities stating (a) that a Change of Control has occurred
and that a Change of Control Offer is being made as described in this Section
3.18 and that all Securities properly tendered will be accepted for payment, (b)
the purchase price and the repurchase date, which will be no later than 30
Business Days from the date such notice is mailed (the "Change of Control
Payment Date"), (c) that only Securities not tendered will continue to accrue
interest, (d) that any Securities accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of Control Payment
Date, (e) that Holders electing to have Securities redeemed pursuant to the
Change of Control Offer will be required to surrender the Securities, with the
form entitled "Option of Holder to Elect to Have Security Repurchased" on the
reverse of the Security completed (with the box checked referencing the Change
of Control Offer pursuant to this Section 3.18), to the Issuer or paying agent
prior to the close of business on the third Business Day preceding the Change of
Control Payment Date, (f) that Holders will be entitled to withdraw their
election if the Issuers or paying agent receives, not later than the second
Business Day preceding the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Securities delivered for redemption, and a statement that
such Holder is withdrawing his election to have the Securities redeemed, (g)
that Holders whose Securities are being redeemed only in part will be issued new
Securities equal in principal amount to the unredeemed portion of the Securities
surrendered, which unredeemed portion must be equal to $1,000 in principal
amount or an integral multiple thereof, and (h) such other instructions
determined by the Issuers, consistent with this provision, that a Holder of the
Securities must follow in order to have such Holder's Securities repurchased.
On the Change of Control Payment Date, the Issuers shall, to the extent
lawful, (i) accept for payment Securities or portions thereof tendered pursuant
to the Change of Control Offer, (ii) deposit with the paying agent money
sufficient to pay the redemption price of all Securities or portions thereof so
tendered and (iii) deliver to the Trustee Securities so accepted together with
an Officer's Certificate stating the Securities or portions thereof tendered to
the Issuers. The paying agent shall promptly mail to the Holder of Securities so
accepted payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail to Holders whose Securities are redeemed only in
part new Securities equal in principal amount to any unredeemed portion of the
Securities surrendered, provided that such new Securities shall be in a
principal amount of $1,000 or an integral multiple thereof.
ARTICLE FOUR
REMEDIES OF THE TRUSTEE AND
SECURITYHOLDERS ON EVENT OF DEFAULT
SECTION 4.1 Events of Default. An "Event of Default" occurs if:
(1) the Issuers default in the payment of interest on any
Security when the same becomes due and payable and the Default
continues for a period of 30 days;
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(2) the Issuers default in the payment of the principal of any
Security when the same becomes due and payable, whether at maturity,
upon redemption or otherwise;
(3) an Issuer fails to comply with any of its other agreements
or covenants in, or any other provisions of, the Securities or this
Indenture and the Default continues for the period and after the notice
specified in this Section 4.1;
(4) a default occurs under any mortgage indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by an Issuer
or any of its Subsidiaries (or the payment of which is guaranteed by an
Issuer or any of its Subsidiaries) other than (i) Indebtedness of any
of the Advantica Group to any of the Advantica Group or Indebtedness of
any of the Denny's Holdings Group to any of the Denny's Holdings Group
or (ii) Indebtedness of a nonconsolidated subsidiary of an Issuer that
is nonrecourse to such Issuer or its consolidated Subsidiaries), if (a)
either (x) such default results from the failure to pay principal upon
the final maturity of such Indebtedness (after the expiration of any
applicable grace period) or (y) as a result of such default the
maturity of such Indebtedness has been accelerated prior to its final
maturity, (b) the principal amount of such Indebtedness, together with
the principal amount of any other such Indebtedness with respect to
which the principal amount remains unpaid upon its final maturity
(after the expiration of any applicable grace period), or the maturity
of which has been so accelerated, aggregates $30,000,000 or more and
(c) such default does not result from compliance with any applicable
law or any court order or governmental decree to which such Issuer or
any of its Subsidiaries is subject;
(5) a final judgment or final judgments for the payment of
money are entered by a court or courts of competent jurisdiction
against an Issuer or any of its Subsidiaries and such judgment or
judgments remain undischarged for a period (during which execution
shall not be effectively stayed) of 60 days, provided that the
aggregate of all such judgments (net of amounts covered by insurance,
treating any deductibles, self-insurance or retention as not so
covered) exceeds $10,000,000; and
(6) an Issuer or any Significant Subsidiary of an Issuer
pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief
against it in an involuntary case,
(c) consents to the appointment of a Custodian of it
or for all or substantially all of its property, or
(d) makes a general assignment for the benefit of its
creditors; or
(7) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(a) is for relief against an Issuer or any
Significant Subsidiary of an Issuer in an involuntary case,
(b) appoints a Custodian of an Issuer or any
Significant Subsidiary of an Issuer or for all or
substantially all of its property, or
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(c) orders the liquidation of an Issuer or any
Significant Subsidiary of an Issuer,
and the order or decree remains unstayed and in effect for 60 days.
The term "Custodian" means any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy Law.
An Event of Default shall not be deemed to have occurred under clause
(4) or (5) until the Issuers shall have received written notice thereof from the
Trustee or the Holders of at least 30% in aggregate principal amount of the
Securities then outstanding. A Default under clause (3) is not an Event of
Default until the Trustee notifies the Issuers, or the Holders of at least 30%
in aggregate principal amount of the Securities then outstanding notify the
Issuers and the Trustee, of the Default and the Issuers do not cure the Default
within 30 days after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default."
In the case of any Event of Default pursuant to the provisions of this
Section 4.1 occurring by reason of any willful action (or inaction) taken (or
not taken) by or on behalf of an Issuer with the intention of avoiding payment
of the premium which the Issuers would have to pay if the Issuers then had
elected to redeem the Securities pursuant to Section 11.1, an equivalent premium
shall also become and be immediately due and payable to the extent permitted by
law, anything in this Indenture or in the Securities contained to the contrary
notwithstanding.
SECTION 4.2 Acceleration. If an Event of Default (other than an Event
of Default specified in clause (6) or (7) of Section 4.1) occurs and is
continuing, the Trustee may, by written notice to the Issuers, or the Holders of
at least 30% (or 25% in the case of an Event of Default specified in Section
4.1(l) or 4.1(2)) in aggregate principal amount of the Securities then
outstanding may, by written notice to the Issuers and the Trustee, and the
Trustee shall, upon the request of such Holders, declare 100% of the unpaid
principal of and any accrued and unpaid interest on the Securities to be due and
payable. Upon such declaration the principal and interest shall be due and
payable immediately; provided, however, that if any Senior Indebtedness is
outstanding pursuant to the Credit Agreement, upon a declaration of
acceleration, such principal and interest shall be due and payable upon the
earlier of (x) the day that is five Business Days after the provision to the
Issuers and the Credit Agent of such written notice, unless such Event of
Default is cured or waived prior to such date, and (y) the date of acceleration
of any Senior Indebtedness under the Credit Agreement. In the event of a
declaration of acceleration because an Event of Default specified in Section
4.1(4) has occurred and is continuing, such declaration of acceleration shall be
automatically annulled if such payment default is cured or waived or the holders
of the Indebtedness which is the subject of such Event of Default have rescinded
their declaration of acceleration in respect of such Indebtedness within 60 days
thereof and the Trustee has received written notice of such cure, waiver or
rescission and no other Event of Default under Section 4.1(4) has occurred and
is continuing with respect to which 60 days have elapsed since the declaration
of acceleration of the Indebtedness which is the subject of such other event of
default (without rescission of the declaration of acceleration of such
Indebtedness). If an Event of Default specified in clause (6) or (7) of Section
4.1 occurs, the unpaid principal of and any accrued and unpaid interest on all
the Securities shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.
The Holders of a majority in principal amount of the then outstanding Securities
by written notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or waived. No such rescission shall affect any subsequent Default or Event of
Default or impair any right consequent thereto.
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SECTION 4.3 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. Except as set forth in
Section 2.6 hereof, all remedies are cumulative to the extent permitted by law.
SECTION 4.4 Waiver of Defaults. Subject to Section 7.2 hereof, the
Holders of a majority in principal amount of the then outstanding Securities by
notice to the Trustee may waive any past Default or Event of Default and its
consequences except a continuing Default or Event of Default in the payment of
the principal of or interest on any Security. Upon any such waiver, such Default
or Event of Default shall cease to exist and together with any Event of Default
arising therefrom, shall be deemed to have been cured for every purpose of this
Indenture, but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
SECTION 4.5 Control by Majority. The Holders of a majority in principal
amount of the then outstanding Securities may direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it. However, the Trustee may (i)
refuse to follow any direction that conflicts with law or this Indenture, that
the Trustee reasonably determines may be unduly prejudicial to the rights of
other Holders or that may subject the Trustee to personal liability or (ii) take
any other action that it deems proper that is not inconsistent with such
decision. The Trustee shall be entitled to indemnification reasonably
satisfactory to it against losses or expenses caused by the taking or not taking
of such action.
SECTION 4.6 Limitation on Suits. A Holder may pursue a remedy with
respect to this Indenture or the Securities only if:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 30% (or 25 % in the case of an
Event of Default specified in Section 4.1(1) or 4.1(2)) in principal
amount of the Securities then outstanding make a written request to the
Trustee to pursue the remedy;
(3) such Holder or Holders offer and, if requested, provide to
the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(5) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Securities do not give the
Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or
to obtain a preference or priority over another Holder.
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SECTION 4.7 Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment of
principal of and interest on the Security, on or after the respective due dates
expressed in the Security, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of the Holder.
SECTION 4.8 Collection Suit by Trustee. If an Event of Default
specified in Section 4.1(1) or 4.1(2) occurs and is continuing, the Trustee is
authorized to recover judgment in its own name and as trustee of an express
trust against the Issuers for the whole amount of principal and interest
remaining unpaid on the Securities 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.
SECTION 4.9 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 allowed in any judicial
proceedings relative to the Issuers (or any other obligor upon the Securities),
their respective creditors or 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 5.6
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 5.6 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 which the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities 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. If the Trustee does not file a proper claim or proof of debt in the
form required in any such proceeding prior to 30 days before the expiration of
the time to file such claim or claims, then the Credit Agent shall have the
right to file and is hereby authorized to file an appropriate claim for and on
behalf of the Holders.
SECTION 4.10 Priorities. If the Trustee collects any money pursuant to
this Article, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 5.6, 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 the Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for principal and
interest, respectively, and
Third: to the Issuers.
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The Trustee may fix a record date and payment date for any payment to
Holders.
SECTION 4.11 Undertaking for Costs. In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as a Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 4.7, or a suit by Holders of
more than 10% in principal amount of the then outstanding Securities.
ARTICLE FIVE
CONCERNING THE TRUSTEE
SECTION 5.1 Duties and Responsibilities of the Trustee; During Default;
Prior to Default. The Trustee, prior to the occurrence of an Event of Default
and after the curing or waiving of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default has
occurred (which has not been cured or waived) the Trustee shall exercise such of
the rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of such person's own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default which may have
occurred:
(i) the duties and obligations of the Trustee shall
be determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically
set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the
Trustee, and
(ii) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness (if the opinions expressed
therein, upon any statements, certificates or opinions
furnished to the Trustee and conforming to the requirements of
this indenture; but in the case of any such statements,
certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture.
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a responsible officer or responsible officers of
the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in
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principal amount of the Securities at the time outstanding relating to
the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
This Section 5.1 is in furtherance of and subject to Sections 315 and
316 of the Trust Indenture Act of 1939.
SECTION 5.2 Certain Rights of the Trustee. In furtherance of and
subject to the Trust Indenture Act of 1939, and subject to Section 5.1:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report, notice,
request, consent, order, bond, debenture, note, coupon, security or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Issuers
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of Directors
of an Issuer may be evidenced to the Trustee by a copy thereof
certified by the secretary or an assistant secretary of such Issuer;
(c) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by it hereunder in good faith and in accordance with such advice
or Opinion of Counsel;
(d) Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Indenture at the request,
order or direction of any of the Securityholders pursuant to the
provisions of this Indenture, unless such Securityholders shall have
offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred therein or
thereby;
(e) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or
within the discretion, rights or powers conferred upon it by this
Indenture;
(f) prior to the occurrence of an Event of Default hereunder
and after the curing or waiving of all Events of Default, 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, consent, order, approval, appraisal, bond,
debenture, note, coupon, security, or other paper or document unless
requested in writing so to do by the holders of not less than a
majority in aggregate principal amount of the Securities then
outstanding; provided that, if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably
59
assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require reasonable indemnity against
such expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such examination shall be paid by the
Issuers or, if paid by the Trustee or any predecessor Trustee shall be
repaid by the Issuers upon demand; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys not regularly in its employ and the Trustee
shall not be responsible for any misconduct or negligence on the part
of any such agent or attorney appointed with due care by it hereunder.
SECTION 5.3 Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof. The recitals contained herein and
in the Securities, except the Trustee's certificates of authentication, shall be
taken as the statements of the Issuers, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities or as to the adequacy of any disclosure document used in connection
with the sale of the Securities. The Trustee shall not be accountable for the
use or application by the Issuers of any of the Securities or of the proceeds
thereof.
SECTION 5.4 Trustee and Agents May Hold Securities; Collections, etc.
The Trustee or any agent of the Issuers or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities with the same
rights it would have if it were not the Trustee or such agent and may otherwise
deal with the Issuers and receive, collect, hold and retain collections from the
Issuers with the same rights it would have if it were not the Trustee or such
agent.
SECTION 5.5 Moneys Held by Trustee. Subject to the provisions of
Section 9.4 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Issuers or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 5.6 Compensation and Indemnification of Trustee and Its Prior
Claim. The Issuers jointly and severally covenant and agree to pay to the
Trustee from time to time, and the Trustee shall be entitled to reasonable
compensation (which shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust) and the Issuers jointly and
severally covenant and agree to pay or reimburse the Trustee and each
predecessor Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by or on behalf of it in accordance with any of
the provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents and other persons
not regularly in its employ) except any such expense, disbursement or advance as
may arise from its negligence or bad faith. The Issuers also jointly and
severally covenant and agree to indemnify the Trustee and each predecessor
Trustee for, and to hold each of them harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of this Indenture or the
trusts hereunder and its duties hereunder, including the costs and expenses of
defending itself against or investigating any claim of liability in the
premises. The obligations of the Issuers under this Section to compensate and
indemnify the Trustee and each predecessor Trustee and to pay or reimburse the
Trustee and each predecessor Trustee for expenses, disbursements and advances
shall constitute additional indebtedness hereunder and shall survive the
satisfaction and discharge of this Indenture. Such additional indebtedness shall
be a senior claim to that of the Securities upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit of
the holders of particular Securities, and the Securities are hereby subordinated
to such senior claim. If the Trustee incurs
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expenses or renders services after an Event of Default specified in clause (6)
or (7) of Section 4.1 occurs, such expenses and the compensation for such
services are intended to constitute expenses of administration under any
Bankruptcy Law.
SECTION 5.7 Right of Trustee to Rely on Officers' Certificates, etc.
Subject to Sections 5.1 and 5.2, whenever in the administration of the trusts of
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee, and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.
SECTION 5.8 Persons Eligible for Appointment as Trustee. The Trustee
hereunder shall at all times be a corporation having a combined capital and
surplus of at least $25,000,000, and which is eligible in accordance with the
provisions of Section 310(a) of the Trust Indenture Act of 1939. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of a federal, state or District of Columbia supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
SECTION 5.9 Resignation and Removal; Appointment of Successor Trustee.
(a) The Trustee may at any time resign by giving written notice of
resignation to the Issuers and by mailing notice thereof by first-class mail to
holders of Securities at their last addresses as they shall appear on the
Security register. Upon receiving such notice of resignation, the Issuers shall
promptly appoint a successor trustee by written instrument, in duplicate,
executed by authority of the Board of Directors of each Issuer, one copy of
which instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Securityholder
who has been a bona fide holder of a Security or Securities for at least six
months may, on behalf of himself and all others similarly situated, petition any
such court for the appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe, appoint a
successor trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, after written
request therefor by an Issuer or by any Securityholder who has been a
bona fide holder of a Security or Securities for at least six months;
or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.8 and shall fail to resign after written
request therefor by an Issuer or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be
61
appointed, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation:
then, in any such case, the Issuers may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of each Issuer, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder
who has been a bona fide holder of a Security or Securities for at least six
months may on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon, after such notice,
if any, as it may deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the Trustee and
appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Issuers the evidence provided for in
Section 6.1 of the action in that regard taken by the Securityholders.
(d) Any resignation or removal of the Trustee and any appointment of a
successor trustee pursuant to any of the provisions of this Section 5.9 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 5.10.
SECTION 5.10 Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 5.9 shall execute and deliver
to the Issuers and to its predecessor Trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor Trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of an Issuer or of the successor trustee, upon payment of its charges then
unpaid, the Trustee ceasing to act shall, subject to Section 9.4, pay over to
the successor trustee all moneys at the time field by it hereunder and shall
execute and deliver an instrument transferring to such successor trustee all
such rights, powers, duties and obligations. Upon request of any such successor
trustee, such Issuer shall execute any and all instruments in writing for more
fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any Trustee ceasing to act shall, nevertheless, retain a
prior claim upon all property or funds held or collected by such Trustee to
secure any amounts then due it pursuant to the provisions of Section 5.6.
Upon acceptance of appointment by a successor trustee as provided in
this Section 5.10, the Issuers shall mail notice thereof by first-class mail to
the holders of Securities at their last addresses as they shall appear in the
Security register. If the acceptance of appointment is substantially
contemporaneous with the predecessor's resignation, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
5.9. If the Issuers fail to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Issuers.
SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business of Trustee. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder; provided that such
corporation shall be eligible under the provisions of
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Section 5.8, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided that the right to adopt
the certificate of authentication of any predecessor Trustee or to authenticate
Securities in the name of any predecessor Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
SECTION 5.12 Notice of Default. If a Default or an Event of Default
occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to each Securityholder notice of the uncured Default or Event of Default
within 90 days after such Default or Event of Default occurs. The Trustee may
withhold from Securityholders notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest on the Securities) if it determines in good faith that
withholding notice is in the interests of such Securityholders.
ARTICLE SIX
CONCERNING THE SECURITYHOLDERS
SECTION 6.1 Evidence of Action Taken by Securityholders. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by securityholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such securityholders in person or by agent duly appointed in
writing, and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee. Proof of execution of any instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture and (subject to
Sections 5.1 and 5.2) conclusive in favor of the Trustee and the Issuer, if made
in the manner provided in this Article.
SECTION 6.2 Proof of Execution of Instruments and of Holding of
Securities; Record Date. Subject to Sections 5.1 and 5.2, the execution of any
instrument by a securityholder or his agent or proxy may be proved in accordance
with such reasonable rules and regulations as may be prescribed by the Trustee
or in such manner as shall be satisfactory to the Trustee. The holding of
Securities shall be proved by the Security register or by a certificate of the
Registrar thereof. The Issuers may set a record date for purposes of determining
the identity of holders of Securities entitled to vote or consent to any action
referred to in Section 6.1, which record date may be set at any time or from
time to time by notice to the Trustee, for any date or dates (in the case of any
adjournment or resolicitation) not more than 60 days nor less than five days
prior to the proposed date of such vote or consent, and thereafter,
notwithstanding any other provisions hereof, only holders of Securities of
record on such record date shall be entitled to so vote or give such consent or
to withdraw such vote or consent.
SECTION 6.3 Holders to Be Treated as Owners. The Issuers, the Trustee
and any authorized agent of the Issuers or the Trustee may deem and treat the
person in whose name any Security shall be registered upon the Security register
as the absolute owner of such Security (whether or not such Security
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shall be overdue and notwithstanding any notation of ownership or other writing
thereon) for the purpose of receiving payment of, or on account of, the
principal of and premium, if any, and, subject to the provisions of this
Indenture, interest on, such Security and for all other purposes, and neither
the Issuers nor the Trustee nor any authorized agent of the Issuers or the
Trustee shall be affected by any notice to the contrary. All such payments so
made to any such person, or upon his order, shall be valid, and, to the extent
of the sum or sums so paid, effectual to satisfy and discharge the liability for
moneys payable upon any such Security.
SECTION 6.4 Securities Owned by Issuers Deemed Not Outstanding. In
determining whether the holders of the requisite aggregate principal amount of
Securities have concurred in any direction, consent or waiver under this
Indenture, Securities which are owned by an Issuer or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with such Issuer or any other obligor
on the Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, except that for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver only Securities which the Trustee knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not an Issuer or any other obligor upon the Securities or any
person directly or indirectly controlling or controlled by or under direct or
indirect common control with an Issuer or any other obligor on the Securities.
In case of a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Trustee in accordance with
such advice. Upon request of the Trustee, the Issuers shall furnish to the
Trustee promptly an Officers' Certificate listing and identifying all
Securities, if any, known by each Issuer to be owned or held by or for the
account of any of the above-described persons; and, subject to Sections 5.1 and
5.2, the Trustee shall be entitled to accept such Officers' Certificate as
conclusive evidence of the facts therein set forth and of the fact that all
Securities not listed therein are outstanding for the purpose of any such
determination.
SECTION 6.5 Right of Revocation of Action Taken. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 6.1, of
the taking of any action by the holders of the percentage in aggregate principal
amount of the Securities specified in this Indenture in connection with such
action, any holder of a Security the certificate number of which is shown by the
evidence to be included among the certificate numbers of the Securities the
holders of which have consented to such action may, by filing written notice at
the Corporate Trust Office and upon proof of holding as provided in this
Article, revoke such action so far as concerns such Security. Except as
aforesaid, any such action taken by the holder of any Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security and of any Securities issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon any such Security. Any action taken by the holders of the percentage in
aggregate principal amount of the Securities specified in this Indenture in
connection with such action shall be conclusively binding upon the Issuers, the
Trustee and the holders of all the Securities.
ARTICLE SEVEN
SUPPLEMENTAL INDENTURES
SECTION 7.1 Supplemental Indentures Without Consent of Securityholders.
The Issuers, when authorized by a resolution of their respective Boards of
Directors, and the Trustee may from time to
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time and at any time enter into an indenture or indentures supplemental hereto
for one or more of the following purposes:
(a) to evidence the succession of another corporation to
either Issuer or successive successions and the assumption by the
successor corporation of the covenants, agreements and obligations of
such Issuer pursuant to Article Eight;
(b) to add to the covenants of the Issuers such further
covenants, restrictions, conditions or provisions as such Boards of
Directors and the Trustee shall consider to be for the protection of
the holders of Securities, and to make the occurrence, or the
occurrence and continuance, of a default in any such additional
covenants, restrictions, conditions or provisions an Event of Default
permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; provided that in
respect of any such additional covenant, restriction, condition or
provision such supplemental indenture may provide for a particular
period of grace after default (which period may be shorter or longer
than that allowed in the case of other defaults) or may provide for an
immediate enforcement upon such an Event of Default or may limit the
remedies available to the Trustee upon such an Event of Default or may
limit the right of the holders of a majority in aggregate principal
amount of the Securities to waive such an Event of Default;
(c) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may
be defective or inconsistent with any other provision contained herein
or in any supplemental indenture; or to make such other provisions in
regard to matters or questions arising under this Indenture or under
any supplemental indenture as such Boards of Directors may deem
necessary or desirable and which shall not materially and adversely
affect the interests of the holders of the Securities;
(d) to provide for the issuance under this Indenture of
Securities in coupon form (including Securities registrable as to
principal only) and to provide for exchangeability of such Securities
with Securities issued hereunder in fully registered form, and to make
all appropriate changes for such purpose;
(e) to provide for the issuance and authorization of the
Exchange Securities.
The Trustee is hereby authorized to join in the execution of any such
supplemental indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property thereunder, but the
Trustee shall not be obligated to enter into any such supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section
may be executed without the consent of the holders of any of the Securities at
the time outstanding, notwithstanding any of the provisions of Section 7.2.
SECTION 7.2 Supplemental Indentures With Consent of Securityholders.
With the consent (evidenced as provided in Article Six) of the holders of not
less than a majority in aggregate principal amount of the Securities at the time
outstanding, the Issuers, when authorized by a resolution of their respective
Boards of Directors, and the Trustee may, from time to time and at any time,
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of
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modifying in any manner the rights of the holders of the Securities; provided
that no such supplemental indenture shall (a) extend the final maturity of any
Security, or reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon, or reduce the premium, if any, payable
thereon, or reduce any amount payable on redemption thereof, or impair or affect
the right of any Securityholder to institute suit for the payment thereof, or
waive a default in the payment of principal of, premium, if any, or interest on
any Security, change the currency of payment of principal of, premium, if any,
or interest on any Security, or modify any provision of this Indenture with
respect to the priority of the Securities in right of payment without the
consent of the holder of each Security so affected, or (b) reduce the aforesaid
percentage of Securities, the consent of the holders of which is required for
any such supplemental indenture, without the consent of the holders of all
Securities then outstanding.
Upon the request of the Issuers, accompanied by a copy of a resolution
of their respective Boards of Directors certified by their respective
Secretaries or Assistant Secretaries authorizing the execution of any such
supplemental indenture, and upon the filing with the Trustee of evidence of the
consent of securityholders and other documents, if any, required by Section 6.1,
the Trustee shall join with the Issuers in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
It shall not be necessary for the consent of the Securityholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Issuers and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Issuers
shall mail a notice thereof by first-class mail to the holders of Securities at
their addresses as they shall appear on the registry books of the Issuers,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Issuers to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 7.3 Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and be deemed to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Issuers and the holders of Securities
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 7.4 Documents to Be Given to Trustee. The Trustee, subject to
the provisions of Sections 5.1 and 5.2, may receive an Officers' Certificate and
an Opinion of Counsel as conclusive evidence that any such supplemental
indenture complies with the applicable provisions of this Indenture.
SECTION 7.5 Notation on Securities in Respect of Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article may bear a
notation in form approved by the Trustee as to any matter provided for by such
supplemental indenture or as to any action taken at any such meeting. If the
Issuers or the Trustee shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Boards of Directors of each
Issuer, to any modification of this Indenture contained in any such supplemental
indenture may be prepared by the Issuers, authenticated by the Trustee and
delivered in exchange for the Securities then outstanding.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 8.1 When Issuer May Merge, etc. Neither Issuer shall
consolidate or merge with or into, or sell, transfer, lease or convey all or
substantially all of its assets to, any person unless:
(1) the person formed by or surviving any such consolidation
or merger (if other than such Issuer), or to which such sale, transfer,
lease or conveyance shall have been made, is a corporation organized
and existing under the laws of the United States, any state thereof or
the District of Columbia;
(2) the corporation formed by or surviving any such
consolidation or merger (if other than such Issuer), or to which such
sale, transfer, lease or conveyance shall have been made, assumes all
the obligations of such Issuer pursuant to a supplemental indenture in
a form reasonably satisfactory to the Trustee under the Securities and
this Indenture;
(3) immediately after such transaction no Default or Event of
Default exists;
(4) such Issuer or any corporation formed by or surviving any
such consolidation or merger, or to which such sale, transfer, lease or
conveyance shall have been made, shall have an Adjusted Consolidated
Net Worth (immediately after the transaction but prior to any purchase
accounting adjustments resulting from the transaction) equal to or
greater than the Adjusted Consolidated Net Worth of such Issuer
immediately preceding the transaction; provided, however, that this
clause (4) shall not apply to any transaction where the consideration
consists solely of common stock or other Equity Interests of such
Issuer or any surviving corporation and any liabilities of such person
are not assumed by and are specifically non-recourse to such Issuer or
such surviving corporation; and
(5) after giving effect to such transaction and immediately
thereafter, such Issuer or any corporation formed by or surviving any
such consolidation or merger, or to which such sale, transfer, lease or
conveyance shall have been made, shall be permitted to incur at least
$1.00 of additional Indebtedness as provided under clause (ii) of
Section 3.11(a) hereof if such provision were applicable to such
entity.
SECTION 8.2 Successor Corporation Substituted. Upon any consolidation
or merger, or any sale, transfer, lease, conveyance or other disposition of all
or substantially all of the assets of an Issuer in accordance with Section 8.1,
the successor corporation formed by such consolidation or into or with which
such Issuer is merged or to which such sale, lease, conveyance or other
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Issuers under this Indenture with the same effect
as if such successor person has been named as an Issuer herein and thereafter,
except in the case of a lease, the predecessor corporation shall be relieved of
all obligations and covenants under this Indenture and the Securities.
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ARTICLE NINE
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS; DEFEASANCE
SECTION 9.1 Satisfaction and Discharge of Indenture. If at any time (a)
the Issuers shall have paid or caused to be paid the principal of and interest
on all the Securities outstanding hereunder, as and when the same shall have
become due and payable, or (b) the Issuers shall have delivered to the Trustee
for cancellation all Securities theretofore authenticated (other than any
Securities which shall have been destroyed, lost or stolen and which shall have
been replaced or paid as provided in Section 2.6) or (c) all Securities not
theretofore cancelled or delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Issuers shall deposit with the Trustee, in trust, funds sufficient to pay at
maturity or upon redemption of all the Securities (other than any Securities
which shall have been destroyed, lost or stolen and which shall have been
replaced or paid as provided in Section 2.6) not theretofore cancelled or
delivered to the Trustee for cancellation, including principal and interest due
or to become due to such date of maturity or redemption date, as the case may be
(but excluding, however, the amount of any moneys for the payment of principal
of or interest on the Securities theretofore repaid to the Issuers in accordance
with the provisions of Section 9.4 or paid to any state or the District of
Columbia pursuant to its unclaimed property or similar laws), and (d) the
Issuers shall also pay or cause to be paid all other sums payable hereunder by
the Issuers, then this Indenture shall cease to be of further effect (except as
to (i) rights of registration of transfer and exchange, and the Issuers' right
of optional redemption, (ii) substitution of apparently mutilated, defaced,
destroyed, lost or stolen securities, (iii) rights of holders to receive
payments of principal thereof and interest thereon, (iv) the rights, obligations
and immunities of the Trustee hereunder, (v) the rights of the securityholders
as beneficiaries hereof with respect to the property so deposited with the
Trustee payable to all or any of them and (vi) the obligation of the Issuers to
maintain an office or agency as provided in Section 3.2), and the Trustee, on
demand of the Issuers accompanied by an Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Issuers, shall execute proper
instruments acknowledging such satisfaction of and discharging this Indenture.
The Issuers jointly and severally agree to reimburse the Trustee for any costs
or expenses thereafter reasonably and properly incurred and to compensate the
Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Securities.
SECTION 9.2 Application by Trustee of Funds Deposited for Payment of
Securities. Subject to Section 9.4, all moneys deposited with the Trustee
pursuant to Section 9.1 or 9.5 shall be held in trust and applied by it to the
payment, either directly or through any paying agent (including the Issuers
acting as their own paying agent), to the holders of the particular Securities
for the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal and interest;
but such money need not be segregated from other funds except to the extent
required by law.
SECTION 9.3 Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture all moneys then held by
any paying agent under the provisions of this Indenture shall, upon demand of
the Issuers, be repaid to it or paid to the Trustee and thereupon such paying
agent shall be released from all further liability with respect to such moneys.
SECTION 9.4 Return of Moneys Held by Trustee and Paying Agent Unclaimed
for Three Years. Any moneys deposited with or paid to the Trustee or any paying
agent for the payment of the principal of or interest on any Security and not
applied but remaining unclaimed for three years after the
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date upon which such principal or interest shall have become due and payable,
shall, upon the written request of the Issuers and unless otherwise required by
mandatory provisions of applicable escheat or abandoned or unclaimed property
law, be repaid to the Issuers by the Trustee or such paying agent, and the
holder of such Security shall, unless otherwise required by mandatory provisions
of applicable escheat or abandoned or unclaimed property laws, thereafter look
only to the Issuer for any payment which such holder may be entitled to collect,
and all liability of the Trustee or any paying agent with respect to such moneys
shall thereupon cease.
SECTION 9.5 Defeasance. At the Issuers' option, either (a) the Issuers
shall be deemed to have been Discharged (as defined below) from their respective
obligations under the Securities on the 91st day after the applicable conditions
set forth below have been satisfied or (b) the Issuers shall cease to be under
any obligation to comply with any term, provision or condition set forth in
Sections 3.9 through 3.18, 8.1 and 8.2 with respect to the Securities at any
time after the applicable conditions set forth below have been satisfied: (1)
the Issuers shall have deposited or caused to be deposited irrevocably with the
Trustee as funds in trust, specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of the Securities (i) funds in an amount
sufficient to pay (A) the principal amount of the Securities in full on the date
of maturity of the Securities or a selected date of redemption of the Securities
as permitted under this Indenture (if such Securities are to be called for
redemption and satisfactory arrangements have been made with the Trustee for the
giving of notice of redemption) and (B) the interest on such aggregate principal
amount to the date of maturity of the Securities or such date of redemption,
taking into account all intervening interest payment dates, for the period from
the date through which interest on the Securities has been paid to the date of
maturity of the Securities or such date of redemption and all other sums payable
hereunder by the Issuers; provided that such funds, if invested, shall be
invested only in U.S. Government obligations maturing prior to the date of
maturity of the Securities or, to the extent applicable, such date of redemption
and such intervening interest payment dates; and, provided further, however,
that the Trustee shall have no obligation to invest such funds; or (ii) U.S.
Government obligations in such aggregate principal amount and maturity on such
dates as will, together with the income or increment to accrue thereon, but
without consideration of any reinvestment of such income or increment, be
sufficient to pay when due (including any intervening interest payment dates)
the amounts set forth in the foregoing clauses (A) and (B); or (iii) a
combination of (i) and (ii) sufficient (in the cases of deposits made pursuant
to (ii) or (iii)), in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee, to pay and discharge each installment of principal of, and interest on,
the outstanding Securities on the dates such installments of principal or
interest are due; (2) no Event of Default or event which with notice or lapse of
time would become an Event of Default with respect to the Securities shall have
occurred and be continuing on the date of such deposit; (3) the Issuers shall
have delivered to the Trustee (A) an Opinion of Counsel to the effect that the
deposit of such funds or investments or both to defease the Issuers' obligations
in respect of the Securities is in accordance with the provisions of this
Indenture and (B) either (i) an Opinion of Counsel to the effect that Holders of
the Securities will not recognize income, gain or loss for United States federal
income tax purposes as a result of the exercise of the option under this Section
9.5 and will be subject to United States federal income tax on the same amount
and in the same manner and at the same time as would have been the case if such
option had not been exercised, or (ii) a private letter ruling to that effect
directed to the Trustee received from the United States Internal Revenue
Service; and (4) the deposit of such funds or investments shall not contravene
applicable law.
"Discharged" means that the Issuers shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Securities and to have satisfied all the obligations under this Indenture and
the Securities (and the Trustee, at the request and the expense of the Issuers,
shall execute proper instruments acknowledging the same), except (i) the rights
of Holders of Securities to receive, from the trust fund described in clause (1)
above, payment of the principal of and the interest
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on the Securities when such payments are due; (ii) the Issuers' obligations with
respect to the Securities under Section 2.5, 2.6, and 9.4; (iii) the rights,
powers, trusts, duties and immunities of the Trustee hereunder; and (iv) the
obligation of the Issuers to maintain an office or agency as provided in Section
3.2.
ARTICLE TEN
MISCELLANEOUS PROVISIONS
SECTION 10.1 Stockholders, Officers and Directors of Issuers Exempt
from Individual Liability. No recourse under or upon any obligation, covenant or
agreement contained in this Indenture, or in any Security, or because of any
indebtedness evidenced thereby, shall be had against any past, present or future
incorporator, stockholder, officer or director, as such, of Advantica or Denny's
Holdings or of any successor, either directly or through Advantica or Denny's
Holdings or any successor, under any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or equitable
proceeding or otherwise, all such liability being expressly waived and released
by the acceptance of the Securities by the holders thereof and as part of the
consideration for the issue of the Securities. Nothing in this provision limits
the liability, if any, of any such incorporator, officer, director or
shareholder, as such, under the federal securities laws.
SECTION 10.2 Provisions of Indenture for the Sole Benefit of Parties
and Securityholders. Nothing in this Indenture or in the Securities, expressed
or implied, shall give or be construed to give to any person, firm or
corporation, other than the parties hereto and their successors and the holders
of Senior Indebtedness and the holders of the Securities, any legal or equitable
right, remedy or claim under this Indenture or under any covenant or provision
herein contained, all such covenants and provisions being for the sole benefit
of the parties hereto and their successors and of the holders of Senior
Indebtedness and the holders of the Securities.
SECTION 10.3 Successors and Assigns of Issuers Bound by Indenture. All
the covenants, stipulations, promises and agreements in this Indenture contained
by or in behalf of each Issuer shall bind its successors and assigns, whether so
expressed or not.
SECTION 10.4 Notices and Demands on Issuers, Trustee and
Securityholders. Any notice or demand which by any provision of this Indenture
is required or permitted to be given or served by the Trustee or by the holders
of Securities to or on the Issuers may be given or served by hand delivery, by
overnight courier or by being deposited postage prepaid, first-class mail
(except, in each case, as otherwise specifically provided herein), in each case
addressed (until another address of the Issuers is filed by the Issuers with the
Trustee) to Advantica Restaurant Group, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer. Any notice, direction,
request or demand by the Issuers or any securityholder to or upon the Trustee
shall be deemed to have been sufficiently given or made, for all purposes, if
given or made at the Corporate Trust Office.
Where this Indenture provides for notice to Holders, such notice shall
be sufficiently given (unless otherwise herein expressly provided) if in writing
and delivered by hand, delivered by overnight courier or mailed, first-class
postage prepaid, to each Holder entitled thereto, at his last address as it
appears in the Security register. In any case where notice to Holders is given
by any of the foregoing means, neither the failure to give such notice by such
means, nor any defect in any notice so given, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the person entitled
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to receive such notice, either before or after the event, and such waiver shall
be the equivalent of such notice. Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Issuers and
securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 10.5 Officers' Certificates and Opinions of Counsel; Statements
to Be Contained Therein. Upon any application or demand by the Issuers to the
Trustee to take any action under any of the provisions of this Indenture, the
Issuers shall furnish to the Trustee an Officers' Certificate of each Issuer,
which may be a joint certificate of both Issuers, stating that all conditions
precedent provided for in this Indenture relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent have been complied with, except that in
the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture relating
to such particular application or demand, no additional certificate or opinion
need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture 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 has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with and (d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of an Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters information with respect to which is in the possession of an
Issuer, upon the certificate, statement or opinion of or representations by an
officer or officers of such Issuer, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous.
Any certificate, statement or opinion of an officer of an Issuer or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer, unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
71
SECTION 10.6 Payments Due on Saturdays, Sundays and Holidays. If the
date of maturity of interest on or principal of the Securities or the date fixed
for redemption of any Security shall not be a Business Day, then payment of
interest or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date.
SECTION 10.7 Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939. If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with another provision included in this Indenture
by operation of Sections 310 to 317, inclusive, of the Trust Indenture Act of
1939 (an "incorporated provision"), such incorporated provision shall control.
SECTION 10.8 New York Law to Govern. This Indenture and each Security
shall be deemed to be a contract under the laws of the State of New York, and
for all purposes shall be construed in accordance with the laws of said state,
except as may otherwise be required by mandatory provisions of law.
SECTION 10.9 Counterparts. This Indenture may be executed in any number
of counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
SECTION 10.10 Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 11.1 Right of Optional Redemption. Except as provided below,
the Securities may not be redeemed, in whole or in part, at the option of the
Issuers prior to September 30, 2004. On and after such date, the Securities may
be redeemed, in whole or in part, at the option of the Issuers, upon the terms
and subject to the conditions set forth in the form of Security hereinabove
recited. Notwithstanding the foregoing, prior to September 30, 2004, the Issuers
may redeem up to 35% of the aggregate principal amount of Securities outstanding
on the date hereof at a redemption price (expressed as a percentage of the
principal amount) of 112.75%, plus accrued and unpaid interest, if any, to the
redemption date, from the net proceeds of any Public Offering.
SECTION 11.2 Notice of Redemption; Partial Redemptions. Notice of
redemption to the holders of Securities to be redeemed as a whole or in part
shall be given by mailing notice of such redemption by first class mail, postage
prepaid, at least 30 days and not more than 60 days prior to the date fixed for
redemption to such holders of Securities at their last addresses as they shall
appear upon the registry books. Any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
The notice of redemption to each such holder shall specify the
principal amount of each Security held by such holder to be redeemed, the date
fixed for redemption, the redemption price, the place or places of payment, that
payment will be made upon presentation and surrender of such Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice and that on and
72
after said date interest thereon or on the portions thereof to be redeemed will
cease to accrue. In case any Security is to be redeemed in part only the notice
if redemption shall state the portion of the principal amount thereof to be
redeemed and shall state that on and after the date fixed for redemption, upon
surrender of such Security, a new Security or Securities in principal amount
equal to the unredeemed portion thereof will be issued.
The notice of redemption of Securities to be redeemed at the option of
the Issuers shall be given by the Issuers or, at the Issuers' request, by the
Trustee in the name and at the expense of the Issuers.
On or prior to the redemption date specified in the notice of
redemption given as provided in this Section, the Issuers will deposit with the
Trustee or with one or more paying agents (or, if either Issuer is acting as
paying agent, set aside, segregate and hold in trust as provided in Section 3.4)
an amount of money sufficient to redeem on the redemption date all the
Securities so called for redemption at the appropriate redemption price,
together with accrued interest to the date fixed for redemption. If less than
all the outstanding Securities are to be redeemed the Issuers will deliver to
the Trustee at least 70 days prior to the date fixed for redemption an Officers'
Certificate stating the aggregate principal amount of Securities to be redeemed.
If less than all the Securities are to be redeemed the Trustee shall
select in such manner as it shall deem appropriate and fair, but generally pro
rata or by lot, Securities to be redeemed in whole or in part. Securities may be
redeemed in part in multiples of $1,000 only. The Trustee shall promptly notify
the Issuers in writing of the Securities selected for redemption and, in the
case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed. For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal amount of such Security which has been or
is to be redeemed.
SECTION 11.3 Payment of Securities called for Redemption. If notice of
redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said
date (unless the Issuers shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue and, except as provided in Sections 5.5 and 9.4, such Securities shall
cease from and after the date fixed for redemption to be entitled to any benefit
or security under this Indenture, and the holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to the date fixed for redemption. On presentation
and surrender of such Securities at a place of payment specified in said notice
said Securities or the specified portions thereof shall be paid and redeemed by
the Issuers at the applicable redemption price, together with interest accrued
thereon to the date fixed for redemption; provided that any semi-annual payment
of interest becoming due on the date fixed for redemption shall be payable to
the holders of such Securities registered as such on the relevant record date
subject to the terms and provisions of Section 2.4 hereof.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate borne
by the Security.
Upon presentation of any Security redeemed in part only, the Issuers
shall execute and the Trustee shall authenticate and deliver to or on the order
of the holder thereof, at the expense of the
73
Issuers, a new Security or Securities, of authorized denominations, in principal
amount equal to the unredeemed portion of the Security so presented.
SECTION 11.4 Exclusion of Certain Securities from Eligibility for
Selection for Redemption. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number in a written statement signed by an authorized officer of the Issuers and
delivered to the Trustee at least 40 days prior to the last date on which notice
of redemption may be given as being owned of record and beneficially by, and not
pledged or hypothecated by either (a) an Issuer or (b) an entity specifically
identified in such written statement directly or indirectly controlling or
controlled by or under direct or indirect common control with an Issuer.
SECTION 11.5 Offer to Repurchase by Application of Net Proceeds. At
such time as the Issuers determine to make a Net Proceeds Offer pursuant to the
provisions of Section 3.13 hereof, the Issuers shall deliver to the Trustee a
notice to such effect specifying the aggregate principal amount of the
Securities for which the Net Proceeds Offer will be made. Within 15 days
thereafter, the Trustee shall select the Securities to be offered to be
repurchased in accordance with Section 11.2 hereof. Within 10 days thereafter
the Issuers shall mail or cause the Trustee to mail (in the Issuers' names and
at their expense and pursuant to an Officers' Certificate as required by Section
3.13 hereof) a Net Proceeds Offer to repurchase to each Holder of Securities
whose Securities are to be offered to be repurchased. The Net Proceeds Offer
shall identify the Securities to which it relates and shall contain the
information required by the second paragraph of Section 11.2 hereof and shall
provide for a repurchase date no earlier than 65 days after the mailing of the
Net Proceeds Offer.
A Holder receiving a Net Proceeds Offer may elect to have repurchased
the Securities to which the Net Proceeds Offer relates by providing written
notice thereof to the Trustee and the Issuers on or before 35 days preceding the
repurchase date and shall thereafter complete the form entitled "Option of
Holder to Elect to Have Security Repurchased" on the reverse of the Security
(with the box checked referencing the Net Proceeds Offer pursuant to this
Section 11.5) and surrender the Security to the Issuers, or depositary, if
appointed by the Issuers, or a paying agent at least three days prior to the
repurchase date. A Holder may not elect to have repurchased less than all of the
Securities to which the Net Proceeds Offer relates.
Other than as specifically provided in this Section 11.5, any
repurchase pursuant to this Section 11.5 shall be made pursuant to the
provisions of Sections 11.2 through 11.4 hereof.
SECTION 11.6 Provisions Governing Repurchase Pursuant to Change of
Control Offer. Any repurchase of Securities pursuant to any Holder's acceptance
of a Change of Control Offer shall be governed by the provisions of Section 3.18
of this Indenture and, to the extent applicable and not inconsistent therewith,
the provisions of Sections 11.2 through 11.4 hereof.
74
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed all as of the date first above written.
ADVANTICA RESTAURANT GROUP, INC.
By _______________________________________
Name:
Title:
Attest:
By _______________________
▇▇▇▇▇'▇ HOLDINGS, INC.
By _______________________________________
Name:
Title:
Attest:
By _______________________
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By _______________________________________
Authorized Signatory
75
EXHIBIT A
FORM OF CERTIFICATE OF TRANSFER
Advantica Restaurant Group, Inc.
▇▇▇▇▇'▇ Holdings, Inc.
c/o Advantica Restaurant Group, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
U.S. Bank National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: 12 3/4% Senior Notes due 2007
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of __________, 2002
(the "Indenture"), among Advantica Restaurant Group, Inc. and ▇▇▇▇▇'▇ Holdings,
Inc., as issuers (the "Issuers"), and U.S. Bank National Association, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture. ______________, (the "Transferor") owns and
proposes to transfer the Security[ies] or interest[s] in such Security[ies]
specified in Annex A hereto, in the principal amount of $___________ in such
Security[ies] or interest[s] (the "Transfer"), to __________ (the "Transferee"),
as further specified in Annex A hereto. In connection with the Transfer, the
Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest
in the 144A Global Security or a Definitive Security Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Security is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Security for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any State of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture, the transferred beneficial interest
or Definitive Security will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the 144A Global Security
and/or the Definitive Security and in the Indenture and the Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial
interest in the Regulation S Global Security or a Definitive Security pursuant
to Regulation S. The Transfer is being effected pursuant to and in accordance
with Rule 903 or Rule 904 under the Securities Act and, accordingly, the
Transferor hereby further certifies that (i) the Transfer is not being made to a
person in the United States and (x) at the time the buy order was originated,
the Transferee was outside the United
A-1
States or such Transferor and any Person acting on its behalf reasonably
believed and believes that the Transferee was outside the United States or (y)
the transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the United
States, (ii) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities
Act, (iii) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act and (iv) if the proposed
Transfer is being made prior to the expiration of the Distribution Compliance
Period, the Transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an initial purchaser that participated in
the offering of the applicable Additional Securities) and the interest
transferred will be held immediately thereafter through Euroclear or
Clearstream. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive
Security will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Regulation S Global Security and/or the
Definitive Security and in the Indenture and the Securities Act.
3. [ ] Check and complete if Transferee will take delivery of a
beneficial interest in a Definitive Security pursuant to any provision of the
Securities Act other than Rule 144A or Regulation S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Securities and Restricted Definitive Securities
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any State of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] Such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act; or
(b) [ ] Such Transfer is being effected to an Issuer or a
subsidiary of an Issuer; or
(c) [ ] Such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and
in compliance with the prospectus delivery requirements of the
Securities Act; or
(d) [ ] Such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than
Rule 144A, Rule 144 or Rule 904, and the Transferor hereby
further certifies that it has not engaged in any general
solicitation within the meaning of Regulation D under the
Securities Act and the Transfer complies with the transfer
restrictions applicable to beneficial interests in a
Restricted Global Security or Restricted Definitive Security
and the requirements of the exemption claimed, which
certification is supported by (1) a certificate executed by
the Transferee in a form of Exhibit C to the Indenture and (2)
if such Transfer is in respect of a principal amount of
Securities at the time of transfer of less than $250,000, an
Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to
this certification and provided to the Issuers, which has
confirmed its acceptability), to the effect that such Transfer
is in compliance with the Securities Act. Upon consummation of
the proposed Transfer in accordance with the terms of the
Indenture, the Definitive Security will be subject to the
restrictions on transfer enumerated in the Private Placement
Legend printed on the Definitive Securities and in the
Indenture and the Securities Act.
A-2
4. [ ] Check if Transferee will take delivery of a beneficial
interest in an Unrestricted Global Security or of an Unrestricted Definitive
Security.
(a) [ ] Check if Transfer is Pursuant to Rule 144. (i) The
Transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act and in compliance with the
transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United
States and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or
Definitive Security will no longer be subject to the
restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Securities, on
Restricted Definitive Securities and in the Indenture and the
Securities Act.
(b) [ ] Check if Transfer is Pursuant to Regulation S. (i)
The Transfer is being effected pursuant to and in accordance
with Rule 903 or Rule 904 under the Securities Act and in
compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any
State of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Security will no longer be
subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global
Securities, on Restricted Definitive Securities and in the
Indenture and the Securities Act.
(c) [ ] Check if Transfer is Pursuant to Other Exemption.
(i) The Transfer is being effected pursuant to and in
compliance with an exemption from the registration
requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer
restrictions contained in the Indenture and any applicable
blue sky securities laws of any State of the United States and
(ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation
of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive
Security will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the
Restricted Global Securities or Restricted Definitive
Securities and in the Indenture.
A-3
This certificate and the statements contained herein are made for your benefit
and the benefit of the Issuers.
_______________________________ Dated: ______________________
[Insert Name of Transferor]
By: ___________________________
Name:
Title:
A-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Security (CUSIP ), or
(ii) [ ] 501 Global Security (CUSIP ), or
(iii) [ ] Reg S Global Security (CUSIP ); or
(b) [ ] a Restricted Definitive Security.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Security (CUSIP ), or
(ii) [ ] 501 Global Security (CUSIP ), or
(iii) [ ] Reg S Global Security (CUSIP ),
(iv) [ ] Unrestricted Global Security (CUSIP ); or
(b) [ ] a Restricted Definitive Security; or
(c) [ ] an Unrestricted Definitive Security,
in accordance with the terms of the Indenture.
A-5
EXHIBIT B
FORM OF CERTIFICATE OF EXCHANGE
Advantica Restaurant Group, Inc.
▇▇▇▇▇'▇ Holdings, Inc.
c/o Advantica Restaurant Group, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
U.S. Bank National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: 12 3/4% Senior Notes due 2007
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of __________, 2002
(the "Indenture"), among Advantica Restaurant Group, Inc. and ▇▇▇▇▇'▇ Holdings,
Inc., as issuers (the "Issuers"), and U.S. Bank National Association, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the
Security[ies] or interest[s] in such Security[ies] specified herein, in the
principal amount of $____________ in such Security[ies] or interest[s] (the
"Exchange"). In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Securities or Beneficial Interests
in a Restricted Global Security for Unrestricted Definitive Securities or
Beneficial Interests in an Unrestricted Global Security.
(a) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Security to beneficial interest in an Unrestricted Global
Security. In connection with the Exchange of the Owner's beneficial interest in
a Restricted Global Security for a beneficial interest in an Unrestricted Global
Security in an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Securities and pursuant to and
in accordance with the United States Securities Act of 1933, as amended (the
"Securities Act"), (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest in an
Unrestricted Global Security is being acquired in compliance with any applicable
blue sky securities laws of any State of the United States.
(b) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Security to Unrestricted Definitive Security. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global
Security for an Unrestricted Definitive Security, the Owner hereby certifies (i)
the Definitive Security is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to
B-1
the Restricted Global Securities and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Unrestricted Definitive Security
is being acquired in compliance with any applicable blue sky securities laws of
any State of the United States.
(c) [ ] Check if Exchange is from Restricted Definitive
Security to beneficial interest in an Unrestricted Global Security. In
connection with the Owner's Exchange of a Restricted Definitive Security for a
beneficial interest in an Unrestricted Global Security, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Securities
and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest is being acquired in compliance with any
applicable blue sky securities laws of any State of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive
Security to Unrestricted Definitive Security. In connection with the Owner's
Exchange of a Restricted Definitive Security for an Unrestricted Definitive
Security, the Owner hereby certifies (i) the Unrestricted Definitive Security is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to
Restricted Definitive Securities and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Unrestricted Definitive Security
is being acquired in compliance with any applicable blue sky securities laws of
any State of the United States.
2. Exchange of Restricted Definitive Securities or Beneficial Interests
in Restricted Global Securities for Restricted Definitive Securities or
Beneficial Interests in Restricted Global Securities.
(a) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Security to Restricted Definitive Security. In connection with
the Exchange of the Owner's beneficial interest in a Restricted Global Security
for a Restricted Definitive Security with an equal principal amount, the Owner
hereby certifies that (i) the Restricted Definitive Security is being acquired
for the Owner's own account without transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Securities and pursuant to and in accordance with the
Securities Act, and in compliance with any applicable blue sky securities laws
of any State of the United States. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Security
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Security and
in the Indenture and the Securities Act.
(b) [ ] Check if Exchange is from Restricted Definitive
Security to beneficial interest in a Restricted Global Security. In connection
with the Exchange of the Owner's Restricted Definitive Security for a beneficial
interest in the: [CHECK ONE] [ ] 144A Global Security, [ ] Reg S Global
Security, or [ ] Rule 501 Global Security with an equal principal amount, the
Owner hereby certifies (i) the beneficial interest is being acquired for the
Owner's own account without transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted Global
Securities and pursuant to and in accordance with the Securities Act, and in
compliance with any applicable blue sky securities laws of any State of the
United States. Upon
B-2
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Security and in the Indenture and the Securities Act.
B-3
This certificate and the statements contained herein are made for your benefit
and the benefit of the Issuers.
__________________________
[Insert Name of Owner]
By:_______________________
Name:
Title:
Dated:________________
B-4
EXHIBIT C
FORM OF CERTIFICATE FROM ACQUIRING
INSTITUTIONAL ACCREDITED INVESTOR
Advantica Restaurant Group, Inc.
▇▇▇▇▇'▇ Holdings, Inc.
c/o Advantica Restaurant Group, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
U.S. Bank National Association
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Attention: Corporate Trust Department
Re: 12 3/4% Senior Notes due 2007
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of __________,
2002 (the "Indenture"), among Advantica Restaurant Group, Inc. and ▇▇▇▇▇'▇
Holdings, Inc., as issuers (the "Issuers"), and U.S. Bank National Association,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of: (a) a beneficial interest in a Global Security, or (b) a
Definitive Security, we confirm that:
1. We understand and acknowledge that the Securities have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
or any other applicable securities law, and may not be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act or any other applicable securities law or pursuant to an
exemption therefrom and in each case in compliance with the conditions for
transfer set forth below.
2. We are an institutional "accredited investor" under the Securities
Act within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under
the Securities Act ("Rule 501") or, if the Securities are to be purchased for
one or more accounts ("investor accounts") for which we are acting as fiduciary
or agent, each such investor account is an institutional "accredited investor"
on a like basis. We have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of purchasing the
Securities and invest in or purchase securities similar to the Securities in the
normal course of our business. We and any accounts for which we are acting are
each aware that we may be required, and are each able, to bear the economic risk
of our or its investment in the Securities for an indefinite period of time.
3. We are purchasing the Securities for our own account, or for one or
more investor accounts for which we are acting as a fiduciary or agent, in each
case for investment, and not with a view to, or for offer or sale in connection
with, any distribution thereof in violation of the Securities Act, subject to
any requirement of law that the disposition of our property or the property of
such investor account or accounts be at all times within our or their control
and subject to our or their ability to resell
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such Securities pursuant to Rule 144A under the Securities Act ("Rule 144A") or
any exemption from registration available under the Securities Act.
4. We agree on our own behalf and on behalf of any investor account for
which we are purchasing Securities to offer, sell or otherwise transfer such
Securities prior to the date which is two years (or such other period that may
hereafter be provided under Rule 144(k) under the Securities Act as permitting
resales of restricted securities by non-affiliates without restriction) after
the later of the date of original issue and the last date on which an Issuer or
any affiliate of an Issuer was the owner of such Securities (or any predecessor
thereof) (the "Resale Restriction Termination Date") only (a) to an Issuer, (b)
pursuant to a registration statement which has been declared effective under the
Securities Act, (c) for so long as the Securities are eligible for resale
pursuant to Rule 144A to a person we reasonably believe is a "qualified
institutional buyer" as defined in Rule 144A (a "QIB") that purchases for its
own account or for the account of a QIB and to whom notice is given that the
transfer is being made in reliance on Rule 144A, (d) outside the United States
in an offshore transaction in accordance with Rule 904 under the Securities Act,
(e) to an institutional "accredited investor" within the meaning of subparagraph
(a)(1), (2), (3) or (7) of Rule 501 that is purchasing the Securities for its
own account or for the account of such an institutional "accredited investor"
for investment purposes only, and not with a view to, or for offer or sale in
connection with, any distribution in violation of the Securities Act, or (f)
pursuant to any other available exemption from the registration requirements of
the Securities Act, subject in each of the foregoing cases to any requirement of
law that the disposition of our property or the property of such investor
account or accounts be at all times within our, its or their control and in each
case in compliance with any applicable securities laws of any U.S. state or any
other applicable jurisdiction. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Securities is proposed to be made pursuant to clause (e)
above prior to the Resale Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in the form of this letter to
the Issuers and the Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" within the meaning of
subparagraph (a)(1), (2), (3) or (7) of Rule 501 and that it is acquiring such
Securities for investment purposes and not for distribution in violation of the
Securities Act. Each purchaser acknowledges that the Issuers and the Trustee
reserve the right prior to the offer, sale or other transfer made prior to the
Resale Termination Date to require the delivery of an opinion of counsel,
certifications and/or other information satisfactory to the Issuers and the
Trustee.
5. We understand that the Securities will be delivered in registered
form only and that the certificates delivered to us in respect of the Securities
will contain a legend substantially to the following effect:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL
OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE WHICH IS TWO
YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE
144(K) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF RESTRICTED
SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR
ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS
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SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION
TERMINATION DATE") ONLY (A) TO AN ISSUER, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE
PURSUANT TO RULE ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ TO
A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF
RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR
ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO,
OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT, (E) OUTSIDE OF THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUERS' AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING
CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE INDENTURE
IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND IN EACH
CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY U.S. STATE OR
ANY OTHER APPLICABLE JURISDICTION. THE HOLDER OF THIS SECURITY AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
6. If we are acquiring any of the Securities as a fiduciary or agent
for one or more investor accounts, we represent that we have sole investment
discretion with respect to each such account and we have full power to make the
foregoing acknowledgments, representations, warranties and agreements on behalf
of each such investor account.
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You and the Issuers are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
____________________________________ Dated: __________________, ____
[Insert Name of Accredited Investor]
By:_______________________________
Name:
Title:
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