Exhibit 10.41
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CASTLE BRANDS (USA) CORP.
9 % SENIOR SECURED NOTES, SERIES 2004
DUE MAY 31, 2009
FIRST AMENDED AND RESTATED
TRUST INDENTURE
ORIGINAL DATED AS OF JUNE 1 , 2004
AMENDED AND RESTATED AS OF AUGUST 15, 2005
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TABLE OF CONTENTS
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ARTICLE 1 DEFINED TERMS................................................. 3
1.1 Special Definitions........................................... 3
ARTICLE 2 FORM, EXECUTION, ISSUE AND DELIVERY OF NOTES.................. 9
2.1 Issue of Notes................................................ 9
2.2 Authentication of Physical Notes; Denominations of Notes;
Form; Custody.............................................. 9
2.3 Registration of Owners........................................ 9
2.4 Exchange of Physical Notes.................................... 9
2.5 Pledges....................................................... 10
2.6 Proof of Ownership............................................ 10
2.7 Transfer of Beneficial Interest in the Notes.................. 10
2.8 Valid Obligations............................................. 10
2.9 Execution and Delivery........................................ 11
2.10 Payments...................................................... 11
ARTICLE 3 PAYMENTS OF INTEREST AND PRINCIPAL............................ 11
3.1 Payment by Issuer............................................. 11
3.2 Issue Taxes................................................... 11
3.3 Required Payments............................................. 11
3.4 Registered Owner List......................................... 12
ARTICLE 4 ACCOUNTS...................................................... 13
4.1 Payment Account............................................... 13
4.2 Collection Account............................................ 13
ARTICLE 5 RECEIPT, DISTRIBUTION AND APPLICATION OF TRUST ESTATE......... 13
5.1 Application of the Payment Account When No Event of Default
is Continuing.............................................. 13
5.2 Application of Payments During Continuance of an Event of
Default.................................................... 13
5.3 Amounts Held by Trustee....................................... 14
5.4 Allocation of Payments........................................ 14
5.5 Method of Payment to Owners................................... 14
ARTICLE 6 EVIDENCE OF ACTS OF OWNERS.................................... 15
6.1 Execution by Note Owners or Agents............................ 15
6.2 Future Owners Bound........................................... 15
ARTICLE 7 INDENTURE DEFAULTS - REMEDIES................................. 15
7.1 Indenture Events of Default................................... 15
7.2 Acceleration of Notes......................................... 16
7.3 Annulment of Acceleration of Notes............................ 16
7.4 Default Remedies.............................................. 16
7.5 Other Enforcement Rights...................................... 17
7.6 Effect of Sale, etc........................................... 18
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7.7 Restoration of Rights and Remedies............................ 18
7.8 Application of Sale Proceeds and Deficiency................... 19
7.9 Cumulative Remedies........................................... 19
7.10 Limitations on Suits.......................................... 19
ARTICLE 8 AFFIRMATIVE COVENANTS......................................... 20
8.1 Financial Statements.......................................... 20
8.2 Existence, Compliance and Insurance........................... 20
8.3 Further Assurances............................................ 21
8.4 Performance of Obligations.................................... 21
8.5 Filings to Perfect Security Interests......................... 21
ARTICLE 9 NEGATIVE COVENANTS............................................ 21
9.1 Mergers, Etc.................................................. 21
9.2 Proceeds of Notes............................................. 21
9.3 Transactions with Affiliates.................................. 22
9.4 Jurisdiction of Incorporation................................. 22
ARTICLE 10 THE TRUSTEE................................................... 22
10.1 Certain Duties and Responsibilities of Trustee................ 22
10.2 Trustee's Compensation and Expenses........................... 23
10.3 Certain Rights of Trustee..................................... 24
10.4 Status of Monies Received..................................... 25
10.5 Resignation of Trustee........................................ 26
10.6 Removal of Trustee............................................ 26
10.7 Successor Trustee............................................. 26
10.8 Appointment of Successor Trustee.............................. 26
10.9 Merger or Consolidation of Trustee............................ 26
10.10 Acceptance of Appointment by Successor Trustee................ 27
10.11 Conveyance upon Request of Successor Trustee.................. 27
10.12 Co-Trustee and Collateral Agent............................... 27
10.13 Registrar..................................................... 28
ARTICLE 11 SUPPLEMENTAL INDENTURES, WAIVERS.............................. 28
11.1 Supplemental Indentures Without Note Owners' Consent.......... 28
11.2 Waivers and Consents by Owners; Supplemental Indentures with
Consent.................................................... 28
11.3 Notice of Supplemental Indenture.............................. 29
11.4 Solicitation of Note Owners................................... 29
11.5 Opinion of Counsel Conclusive as to Supplemental Indentures... 29
11.6 Effect of Supplemental Indentures............................. 29
ARTICLE 12 DISCHARGE AND UNCLAIMED FUNDS................................. 30
12.1 Satisfaction and Discharge of Agreement....................... 30
12.2 Return of Unclaimed Monies.................................... 30
ARTICLE 13 MISCELLANEOUS................................................. 30
13.1 Successors and Assigns........................................ 30
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13.2 Unenforceability of Provision................................. 31
13.3 Communications................................................ 31
13.4 Governing Law................................................. 33
13.5 Limitation on Interest........................................ 33
13.6 Counterparts.................................................. 33
13.7 Headings, etc.; Gender........................................ 33
13.8 Amendments.................................................... 34
13.9 Benefits of Agreement Restricted to Parties and Owners........ 34
13.10 Waiver of Notice.............................................. 34
13.11 Non-Recourse Persons.......................................... 34
13.12 Additional Financing Statement Filings........................ 34
13.13 Officers' Certificate and Opinions of Counsel; Statements to
be Contained Therein....................................... 34
13.14 No Oral Agreements............................................ 35
Exhibit A Form of Note
Exhibit B Instruction for Transfer of Registration Request
TRUST INDENTURE
FIRST AMENDED AND RESTATED TRUST INDENTURE dated as of August 15, ▇▇▇▇ (▇▇▇
"▇▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ (▇▇▇) CORP., a Delaware corporation (the
"Issuer"), and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking
association and the indenture trustee hereunder (the "Trustee"; including any
other Person serving as a successor or co-trustee hereunder), and is joined in
by MHW, LTD., a New York corporation as the Collateral Agent hereunder and under
the Security Documents (as defined herein).
RECITALS:
WHEREAS, the defined terms used in this Indenture shall have the respective
meanings set forth in Section 1.1 unless elsewhere defined or the context shall
otherwise require;
WHEREAS, the Issuer and Trustee, joined by the Collateral Agent, have
entered into a First Supplemental Indenture dated of even date herewith ("First
Supplemental Indenture") which amends and restates, as set forth below, the
Trust Indenture entered into as of June 1, 2004.
WHEREAS, the Issuer is authorized by law, and deems it necessary to borrow
money for its proper legal purposes and to grant a continuing security interest
in certain of its Property to secure the payment thereof, and to that end, in
the exercise of said authority, has duly authorized the execution and delivery
of this Indenture providing for the issue of senior secured promissory notes;
WHEREAS, the Issuer has executed and delivered the Security Documents
thereby granting continuing security interests in the Collateral;
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WHEREAS, the Issuer has duly authorized the issuance from time to time of
its Ten Million Dollars ($10,000,000) of its 9% Senior Secured Notes, Series
2004 on the terms herein provided and to be secured by the Collateral pursuant
to the Security Documents;
WHEREAS, the Notes will be issued in the form set forth as Exhibit A in the
aggregate amount not to exceed $10,000,000, and the Issuer will sell
uncertificated beneficial interests in the Notes to Persons who will become the
Owners thereof and the beneficiaries under this Indenture; and
WHEREAS, all acts and proceedings required by law and by the Certificate of
Incorporation and Bylaws of the Issuer necessary to make the Notes, when
executed by the Issuer and authenticated and delivered by the Trustee, the
legal, valid and binding obligations of the Issuer, and all acts and proceedings
required by law and by the Certificate of Incorporation and Bylaws of the Issuer
necessary to constitute this Indenture a legal, valid and binding agreement for
the uses and purposes herein set forth, in accordance with its terms, have been
done and taken; and the Issuer has duly authorized, executed and delivered this
Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that to secure the prompt and
complete payment of the principal of and interest on the Notes, the payment of
all other sums owing hereunder and under all Security Documents and the
performance of the covenants contained herein and in all Security Documents, and
in consideration of the premises and of the covenants contained herein, and the
purchase of beneficial interests in the Notes by the Owners, the Issuer has
hereby granted, bargained, sold, conveyed, assigned, transferred, mortgaged,
affected, pledged, set over, confirmed, granted a continuing security interest
in, and does hereby grant, bargain, sell, convey, assign, transfer, mortgage,
affect, pledge, set over, confirm, grant a continuing security interest to the
Trustee (subject to Section 12.1), all of its right, title and interest in, to
and under (i) all accounts and subaccounts established under this Indenture and
(ii) all funds now or hereafter paid or deposited or required to be paid or
deposited to or with the Trustee pursuant to any term hereof or any term of the
Security Documents or the Parent Guaranty (all such Properties, including
without limitation all properties hereafter specifically subjected to the lien
of this Indenture by any indenture supplement hereto, being hereinafter
collectively referred to as the "Trust Estate").
TO HAVE AND TO HOLD, all and singular, the Trust Estate for the uses and
purposes, and subject to the terms and provisions set forth in this Indenture,
unto the Trustee and its successors and assigns in trust forever.
IN TRUST NEVERTHELESS, under and subject to the terms and conditions herein
set forth and for the equal and proportionate, unless otherwise stated herein,
benefit and security of the Owners from time to time of the Outstanding Notes
and for the enforcement of the prompt and complete payment when due of all sums
due in connection with the Outstanding Notes from time to time, this Indenture
and each of the Security Documents and for the performance and observance by the
Issuer of the covenants, obligations and conditions to be performed and observed
by the Issuer;
PROVIDED, HOWEVER, that these presents are upon the condition that if the
Issuer, its successors or assigns, shall satisfy the conditions set forth in
Section 12.1 for a release of the Trust Estate in full, then this Indenture, and
the estates and rights assigned to the Trustee and in the Security Documents,
shall cease, terminate and be void; otherwise they shall remain and be in full
force and effect;
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IT IS HEREBY FURTHER COVENANTED AND AGREED that the Trust Estate is to be
held and applied by the Trustee for the benefit of the Owners, subject to the
further covenants, agreements, conditions, uses and trust hereafter set forth.
The Issuer, for itself and its successors and assigns, does hereby covenant and
agree with the Trustee for the benefit of all present and future Owners, or any
of them, as follows:
ARTICLE 1
DEFINED TERMS
1.1 Special Definitions. For purposes of this Indenture, capitalized terms
shall have the respective meanings (i) set forth below, (ii) set forth in the
Section or other part of this Indenture following such term, or (iii) provided
for in the Security Documents (such definitions to be equally applicable to both
the singular and plural forms of the terms defined):
Affiliate -- at any time, and with respect to any Person, any other
Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control
with, such first Person. As used in this definition, "Control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise (and "Controlled"
shall be construed accordingly). Unless the context otherwise clearly
requires, any reference to an "Affiliate" is a reference to an Affiliate of
the Issuer.
Amended Note - has the meaning set forth in the First Supplemental
Indenture.
Business Day -- means any day other than a Saturday, Sunday, legal
holiday or a day on which banking institutions in the City of New York, New
York and any other city where the Trustee shall have a corporate trust
office administering any of its duties under this Indenture are authorized
to close by law or executive order of a regulatory or administrative issuer
having jurisdiction in connection therewith.
Closing Date -- the date of the initial issuance of a Note (but
excluding a Note issued in substitution for an outstanding Note). One or
more Notes may be issued from time to time hereunder.
Collateral - as defined in the Security Documents.
Collateral Agent - as defined in the Security Documents; initially,
MHW, Ltd.
Collection Account -- has the meaning set out in Section 4.2.
Contested in Good Faith -- actively contested in good faith by
appropriate actions or proceedings provided that the action to be taken
will not result in any risk of imposition of civil or criminal penalties on
the Trustee or the Owners of the Notes or substantial danger of sale,
forfeiture or loss of a material part of the Collateral.
Debt -- for any Person the sum of the following (without duplication):
(i) all obligations of such Person for borrowed money or evidenced by
bonds, debentures, notes or other similar instruments (including principal,
interest, fees and charges); (ii) all obligations
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of such Person (whether contingent or otherwise) in respect of bankers'
acceptances, letters of credit, surety or other bonds and similar
instruments; (iii) all obligations of such Person to pay the deferred
purchase price of Property; (iv) all obligations under leases which shall
have been, or should have been, in accordance with GAAP, recorded as
capital leases in respect of which such Person is liable; (v) all Debt (as
described in the other clauses of this definition) and other obligations of
others secured by a Lien on any asset of such Person, whether or not such
Debt or other obligation is assumed by such Person; and (vi) all Debt (as
described in the other clauses of this definition) and other obligations of
others guaranteed by such Person or in which such Person otherwise assures
a creditor against loss of the debtor or obligations of others.
Default Rate - ten percent (10%) per annum.
Event of Default -- has the meaning set out in Section 7.1.
Excepted Liens -- (i) Liens for taxes, assessments or other
governmental charges or levies not yet due or which are being Contested In
Good Faith; (ii) Liens in connection with workmen's compensation,
unemployment insurance or other social security, old age pension or public
liability obligations not yet due or which are being Contested In Good
Faith; (iii) operators', vendors', carriers', warehousemen's, repairmen's,
mechanics', workmen's, materialmen's, or other like Liens arising by
operation of law in the ordinary course of business or statutory landlord's
liens (so long as no action has been taken to file or enforce such Liens)
or which are being Contested In Good Faith; (iv) deposits of cash or
securities to secure the performance of bids, trade contracts, leases,
statutory obligations and other obligations of a like nature incurred in
the ordinary course of business; and (v) other Liens expressly permitted by
the Security Documents.
First Supplemental Indenture - has the meaning set forth in the second
recital to this Agreement.
GAAP -- generally accepted accounting principles and practices which
are recognized as such in the United States by the Financial Accounting
Standards Board (or any generally recognized successor) as in effect from
time to time.
Governmental Authority -- the country, the state, county, city and
political subdivisions in which any Person or such Person's Property is
located or which exercises jurisdiction over any such Person or such
Person's Property, and any court, agency, department, commission, board,
body, bureau or instrumentality of any of them including monetary
authorities which exercises jurisdiction over any such Person or such
Person's Property. Unless otherwise specified, all references to
Governmental Authority herein shall mean a Governmental Authority having
jurisdiction over, where applicable, the Issuer, the Parent or any of their
Property or the Trustee or any Note Owner.
Governmental Requirements - meaning any applicable law, statute, code,
ordinance, order, determination, rule, regulation, publication, judgment,
decree, injunction, franchise, permit, registration, consent, approval,
certificate, license, authorization or other directive or requirement
(whether or not having the force of law), of any Governmental Authority.
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Indenture -- this Indenture, as originally executed or as it may from
time to time be supplemented or amended in accordance with the provisions
hereof.
Interest Payment Date - each May 31st and November 30th of each year,
with the first Interest Payment Date being November 30, 2004 and the last
Interest Payment Date being the Maturity Date.
Issuer -- has the meaning set out in the first paragraph of this
Indenture and includes any successor to the Issuer by way of merger,
consolidation, conversion or transfer of all or substantially all assets of
the Issuer.
Investment Grade -- a rating equal to or higher than "BBB-" by
Standard & Poor's Rating Services, a division of The McGraw Hill Companies,
Inc. or any successor thereto or equal to or higher than "Baa3" by ▇▇▇▇▇'▇
Investors Service, Inc. or any successor thereto and equal to or higher
than "BBB-" by Duff & ▇▇▇▇▇▇ Credit Rating Co. or any successors thereto
(if Duff & ▇▇▇▇▇▇ Credit Rating Co. is then rating the applicable security)
or a comparable rating by another nationally recognized statistical rating
organization, which rating and organization are approved by the Issuer.
Lien -- any interest in Property securing an obligation owed to, or a
claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, and including but
not limited to the security interest or lien arising from a mortgage,
encumbrance, pledge, conditional sale or other title retention agreement,
trust receipt or a lease, consignment or bailment for security purposes.
Majority of Owners -- at any time, Owners of more than fifty percent
(50%) of the beneficial interest in the aggregate principal amount owed by
the Issuer pursuant to all Notes then Outstanding.
Maturity Date - May 31, 2009.
Notes - any or all of the Notes executed by the Issuer and
authenticated by the Trustee in the form of Exhibit A attached hereto.
Opinion of Counsel -- an opinion of outside counsel (which may from
time to time serve as counsel for the Issuer, for the Trustee or for an
Owner) reasonably acceptable to the Trustee, which opinion is in scope,
form and substance reasonably satisfactory to the Trustee.
Original Note - has the meaning as set forth in the First Supplemental
Indenture.
Outstanding -- when used with reference to Notes shall mean, as of any
particular time, all Notes executed by the Issuer and authenticated and
delivered by Trustee to the Depository under this Indenture, except:
(a) Notes theretofore cancelled;
(b) Notes for the payment or prepayment of which moneys in the
necessary amount shall have been deposited in trust with the Trustee;
and
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(c) Notes in lieu of or in substitution for which other Notes
shall have been delivered pursuant to the terms of this Indenture.
Owner - A Person who is the owner of a beneficial interest in the
Notes and who is registered as such with the Registrar as provided in
Section 2.3.
Owner Register - as defined in Section 2.3.
Parent - Castle Brands, Inc., a Delaware corporation and owner of all
the capital stock of Issuer.
Parent Guaranty - Guaranty of even date herewith executed by the
Parent to the Trustee for the benefit of the Owners.
Payment Account - has the meaning set out in Section 4.1.
Permitted Investments -- (a) direct obligations of the United States
of America (including obligations issued or held in book-entry form on the
books of the Department of the Treasury of the United States of America and
certificates or other instruments evidencing ownership interests in such
direct obligations of the United States of America such as CATS, TIGRS,
Treasury Receipts and Stripped Treasury Coupons) which mature within one
(1) year after the acquisition thereof; (b) obligations for which the
timely payment of the principal thereof are fully guaranteed by the United
States of America or the Federal Deposit Insurance Corporation, which
mature within one (1) year after the acquisition thereof; (c) certificates
of deposit of, or time deposits in, any bank (including any Trustee) or
trust company organized under the laws of the United States of America or
any state thereof whose unsecured obligations are accorded one of the two
highest ratings by Standard & Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc. or ▇▇▇▇▇'▇ Investors Service, Inc. and by Duff
& ▇▇▇▇▇▇ Credit Rating Co. (if such unsecured obligations are rated by Duff
& ▇▇▇▇▇▇ Credit Rating Co.) and which have at least Five Hundred Million
Dollars ($500,000,000) of stated capital and surplus, maturing within
ninety (90) days after the acquisition thereof; (d) readily marketable
commercial paper of corporations doing business in and incorporated under
the laws of the United States of America or any State thereof given on the
date of the investment a credit rating of at least P-l by ▇▇▇▇▇'▇ Investor
Services, Inc., or A-1 by Standard & Poor's Ratings Services, a division of
The McGraw Hill Companies, Inc. and D-1 by Duff & ▇▇▇▇▇▇ Credit Rating Co.
(if Duff & ▇▇▇▇▇▇ Credit Rating Co. is then rating such commercial paper)
in each case due within 90 days after the date of the making of the
investment; and (e) investments in a money-market fund (including any fund
for which a Trustee or any Affiliate of a Trustee serves as adviser or
sponsor or otherwise receives compensation with respect to such fund) rated
AAA or better by Standard & Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc. or Aaa by ▇▇▇▇▇'▇ Investors Services, Inc. and
having the equivalent rating from Duff & ▇▇▇▇▇▇ Credit Rating Co., if such
investments are then rated by Duff & ▇▇▇▇▇▇ Rating Co. (or equivalent
categories that may be established by such rating services).
Person -- an individual, partnership, corporation, limited liability
company, trust, unincorporated association or organization, government,
governmental agency or governmental subdivision.
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Pledge Creditors -- has the meaning set out in Section 2.5
Property -- any interest in any kind of property or asset, whether
real, personal or mixed, and whether tangible or intangible.
Registered Owner List - a list as of any day, certified by a
Responsible Officer of the Registrar, setting forth the name, address, tax
identification number, principal amount of Notes beneficially owned, amount
of interest and principal payment due or coming due (if applicable), wire
transfer instructions (if applicable) and any other information reasonably
requested by the Trustee, with respect to each Owner of a Note.
Registrar - the Person serving as registrar and transfer agent of the
Issuer under Article 2 of this Indenture. Initially, the Parent shall be
the Registrar. The provisions regarding resignation, removal and succession
of the Trustee shall also apply to the resignation, removal and succession
of the Registrar.
Responsible Officer -- with respect to any corporation, the president,
the chief executive officer, the chief financial officer, or the chief
operating officer; and with respect to any Trustee which is a corporation
or banking association, any vice president, corporate trust officer or
other officer, in each case employed within the corporate trust department
of such Trustee and who has direct supervisory responsibility for the
administration of this Indenture.
Security -- has the same meaning as in Section 2(1) of the Securities
Act of 1933, as amended.
Security Documents - means the (i) Collateral Agreement among the
Company, the Collateral Agent and the Trustee, (ii) the Security Agreement
(MHW, Ltd) between the Trustee and the Collateral Agent, and (iii) the
General Security Agreement (Castle Brands [USA], Corp.) among the Company,
the Collateral Agent and the Trustee, each originally dated as of June 1,
2004, and each being amended by a First Amendment of even date herewith.
Stub Interest - interest accrued on a Note from the Closing Date on
which it is first issued to but not including the next regularly scheduled
Interest Payment Date of such Note.
Supermajority of Owners -- at any time, Owners of sixty-six and 2/3
percent (66 2/3%) or more of the beneficial interest in the aggregate
principal amount owed by the Issuer pursuant to all Notes then Outstanding.
Trust Estate -- has the meaning set out in the granting clause hereof.
Trustee -- has the meaning set out in the first paragraph of this
Indenture. The Trustee shall also serve as paying agent.
UCC -- the Uniform Commercial Code as in effect from time to time in
the State of New York or in any other jurisdiction the laws of which are
applicable to the Collateral.
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Written Request -- with respect to any Person a written order or
request signed in the name of such Person by a Responsible Officer of such
Person (if a corporation) or by a general or managing partner of such
Person (if a partnership) or by the manager of such Person (if a limited
liability company) or by the individual (if such Person is an individual).
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ARTICLE 2
FORM, EXECUTION, ISSUE AND DELIVERY OF NOTES
2.1 Issue of Notes. The Issuer has authorized the issue and sale from time
to time of a maximum of Ten Million Dollars ($10,000,000) aggregate original
principal amount of its 9% Senior Secured Notes, Series 2004 due May 31, 2009.
Physical Notes shall be issuable as fully registered Notes in the name of the
Trustee for the benefit of the Owners. The Owners' beneficial interests in the
Notes shall not be evidenced by physical certificates, but shall be registered
and maintained by the Registrar in book-entry form.
2.2 Authentication of Physical Notes; Denominations of Notes; Form;
Custody.
(a) Authentication. Only such of the physical Notes as shall have been
executed by a Responsible Officer of the Issuer and which bear thereon a
certificate in the form of authentication set forth in Exhibit A executed by the
Trustee, shall be valid, and the authentication by the Trustee upon any such
Note executed on behalf of the Issuer as aforesaid shall be conclusive evidence
that the Note so authenticated has been duly authenticated and delivered
hereunder and is entitled to the benefits of this Indenture.
(b) Denominations. The Notes and the beneficial interests therein
shall be issued from time to time in denominations of Five Thousand Dollars
($5,000) and multiples thereof.
(c) Form. All physical Notes shall be issued in the form of the Notes
attached hereto as Exhibit A, duly executed by the Issuer and authenticated by
the Trustee as hereinabove provided. Each Note shall be dated its respective
Closing Date.
(d) Custody. The Trustee shall maintain custody of the physical Notes,
and no physical Notes shall ever be issued other than in the name of the
Trustee.
2.3 Registration of Owners. The Registrar shall maintain a register (the
"Owner Register"), showing the name, address, tax identification number, and the
principal amount of the Notes beneficially owned (in denominations of $ 5,000 or
multiples thereof) by (i) each Person to whom the Issuer has sold a beneficial
interest in the Notes as certified to the Registrar by a Responsible Officer of
the Issuer and (ii) each Person who is a transferee of a beneficial interest in
the Notes pursuant to Section 2.7. The Person shown as an Owner on the Owner
Register, as certified to the Trustee by the Registrar, shall be deemed and
treated as the owner and holder of a Note for all purposes of this Indenture,
and the Trustee shall not be affected by any notice or knowledge to the
contrary.
2.4 Exchange of Physical Notes. The Issuer shall execute and the Trustee
shall authenticate and deliver, one or more new Notes payable to the Trustee in
exchange therefor, of like tenor for a like aggregate principal amount in
authorized denominations, such that the outstanding aggregate principal amount
of physical Notes held by the Trustee is at all times equal to the outstanding
aggregate principal amount of beneficial interests in the Notes owned by Owners.
All physical Notes surrendered for exchange or replacement shall be canceled by
the Trustee and delivered to the Issuer. If an Amended Note is issued in
substitution and cancellation of an Original Note on any date other than an
Interest Payment Date, the interest payable on such Amended Note on the next
succeeding Interest Payment Date shall include all unpaid interest on the
Original Note at
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the rate provided for in the Original Note accrued through the date of such
Original Note's cancellation as well as interest accrued on the Amended Note
issued in replacement therefor at the rate provided for in the Amended Note from
the date of its issuance to but not including such next succeeding Interest
Payment Date.
2.5 Pledges. With the permission of the Issuer which will not be
unreasonably withheld, Owners may grant security interests in and pledge their
beneficial interest in the Notes to secure obligations owed to third Persons
("Pledge Creditors"). Upon receiving a Written Request from the Issuer and the
Owner to register a grant of a security interest in the Owner's beneficial
interest in the Notes, the Registrar shall note in the Owner Register the name
of the Pledge Creditor, its address and tax identification number, the name of
the Owner and principal amount of beneficial interest in the Notes owned by
Owner and which have been pledged to the Pledge Creditor. Upon acceptance of
such Written Request and, except to the extent that the Owner, Pledge Creditor,
Issuer and Registrar have otherwise agreed in writing, the Pledge Creditor shall
be treated as the registered owner for all purposes of this Indenture and shall
be in control of the Notes so noted on the Owner Register.
2.6 Proof of Ownership. Beneficial ownership interests in the Notes will
not be certificated or represented by negotiable instruments, but will be
maintained by the Registrar and transferred by book-entry procedures in
accordance with Article 8 of the UCC and the Securities Transfer Association
Rules. The Registrar shall mail a statement of ownership to each initial Owner
and to each Person who subsequently becomes an Owner within three (3) Business
Days following entry of such Owner's name on the Owner Registry. If any Owner or
Pledge Creditor desires proof of ownership of its beneficial interest or of the
registration of its security interest in the Notes, the Registrar shall, upon
receiving a Written Request therefor from the Owner or Pledge Creditor, certify
as of the date requested the principal amount of beneficial interest in the
Notes owned by such Owner or pledged to such Pledge Creditor.
2.7 Transfer of Beneficial Interest in the Notes. Any Owner of a Note may
transfer all or part of its beneficial interest in the Notes in increments of
$5,000 by delivering to the Issuer, with a copy to the Registrar, a written
instruction requesting registration of transfer in the form attached hereto as
Exhibit B ("Transfer of Registration Request"), appropriately completed and duly
executed by the Owner and its proposed transferee. Upon receiving such Transfer
of Registration Request approved by a Responsible Officer of the Issuer, the
Registrar shall amend the Owner Register by deducting from the transferor
Owner's account the principal amount of beneficial interest in the Notes to be
transferred pursuant to the Transfer of Registration Request and crediting the
account of the transferee Owner with such principal amount so transferred.
NEITHER THE ISSUER NOR THE REGISTRAR SHALL BE REQUIRED TO REGISTER THE TRANSFER
OF ANY BENEFICIAL INTEREST IN THE NOTES UNLESS, IN THE REASONABLE JUDGMENT OF
THE ISSUER AND (UNLESS WAIVED) IN RELIANCE UPON AN OPINION OF COUNSEL ACCEPTABLE
TO IT, SUCH TRANSFER IS NOT IN VIOLATION OF ANY SECURITIES, ALCOHOLIC BEVERAGE
OR OTHER APPLICABLE LAWS.
2.8 Valid Obligations. All Notes executed, authenticated and delivered in
exchange for, or in replacement of, other Notes as provided in this Indenture
shall be the valid obligations of the Issuer, evidencing the same debt as such
other Notes, shall be entitled to the benefits of this Indenture and Security
Documents to the same extent as the Notes in exchange for or replacement of
which they were executed and delivered, and the rights of Owners of the
beneficial interests in the Notes to payments with respect thereto and to the
benefits and privileges of this Indenture and the Security Documents shall not
be affected by such exchange or replacement.
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2.9 Execution and Delivery. The Notes may be typewritten, printed or
lithographed or produced by any other means acceptable to the Trustee, and shall
be signed on behalf of the Issuer by the manual signature of one of its
Responsible Officers. In the case that any of the officers who shall have signed
or sealed any of the Notes shall cease to be such officer or officers of the
Issuer before the Notes so signed shall have been delivered by or on behalf of
the Issuer, such Notes may nevertheless be delivered and issued and, upon such
delivery and issue, shall be binding upon the Issuer as though those who signed
or sealed the same had continued to be such officer or officers.
2.10 Payments. All payments of interest, principal and other amounts due on
the Notes shall be made by the Issuer to the Trustee, and by the Trustee in turn
to the Owners, proportionate to the principal amount of Notes owned by each as
shown on the Owner Register; provided however, if more than one Note shall be
issued on different Closing Dates, then the Stub Interest due on each Note shall
be paid only to those Owners certified by the Registrar as the Owners of each
such Note. All payments of interest and principal on the Notes shall be made by
the Issuer to or upon the order of the Trustee on the dates and at the times
provided for such payment under this Indenture and the Notes by transfer of
immediately available funds. Provided that the Trustee has received timely
sufficient funds from the sources described in this Indenture to make such
payment and a Registered Owner List, each such payment to the Trustee shall be
valid and effective to fully satisfy and discharge all liability of the Issuer
with respect to its liability on the Notes to the extent of the sum or sums so
paid.
ARTICLE 3
PAYMENTS OF INTEREST AND PRINCIPAL
3.1 Payment by Issuer. The Issuer shall pay all amounts due with respect to
the Notes (without any presentment of any such Notes and without any notation of
such payment being made thereon) in lawful money of the United States of America
to the Trustee as provided for in this Indenture. In any case where the date of
maturity of principal of, and interest on, the Notes or the date fixed for any
prepayment (in whole or in part) of the Notes is not a Business Day, then
payment of such principal of, and interest on, the Notes need not be made on
such date but in no event shall be made later than the next succeeding Business
Day with the same force and effect as if made on the Interest Payment Date,
Maturity Date or the date fixed for such prepayment. Each Owner agrees that the
Trustee, in its individual capacity, shall not be liable to the Owner of any
Note for any amounts payable under any Note or this Indenture. The Notes may be
prepaid at any time without premium or penalty.
3.2 Issue Taxes. The Issuer will pay all taxes, assessments and charges in
connection with the issuance and sale of the Notes by the Issuer and in
connection with any modification of the Notes and will save the Trustee and each
holder of any Note harmless without limitation as to time against any and all
liabilities with respect to all such taxes. The obligations of the Issuer under
this Section 3.2 shall survive the payment or prepayment of the Notes and the
termination of this Indenture.
3.3 Required Payments.
(a) Principal and Interest. Accrued interest on the Notes shall be due
and payable (i) on each Interest Payment Date, (ii) on the date of any
prepayment of any Note being prepaid, (iii)
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on the Maturity Date and (iv) upon acceleration of the Notes pursuant to Article
7. If not earlier prepaid at the discretion of the Issuer, all principal on the
Notes is due on the Maturity Date.
(b) Amortization Schedules. No principal on the Notes is required to
be paid, deposited or reserved by the Issuer pursuant to any amortization or
sinking fund schedule, all principal on the Notes being due on the Maturity
Date.
(c) Record Dates for Payments to Owners. All payments of principal and
interest shall be made to Persons who are Owners as set out on the Owner
Register on the fifteenth (15th) day, whether or not a Business Day, preceding
the date when such payment is due (each such date being a "Record Date").
3.4 Registered Owner List. The Registrar shall deliver a Registered Owner
List to the Trustee at least ten (10) days prior to the date on which any
payment is to be made, any communication is to be delivered, or any other action
or thing is to be taken, by the Trustee with respect to the Owners. With respect
to any payments, the Registered Owner List shall reflect the Owners of the Notes
as of the pertinent Record Date, and the Trustee shall be entitled to rely
conclusively upon such Registered Owner List in effecting payment. Upon
receiving a Written Request from the Trustee, the Registrar shall deliver a
Registered Owner List to the Trustee on the next succeeding Business Day.
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ARTICLE 4
ACCOUNTS
4.1 Payment Account. The Trustee shall establish an account styled the
"Payment Account" (the "Payment Account") subject to the Trustee's sole dominion
and control. All funds representing payments for interest and principal on the
Notes received by the Trustee from the Issuer and by transfers from the
Collection Account pursuant to Section 4.2 below shall be credited to the
Payment Account and shall be applied toward payment of interest and principal on
the Notes. The Issuer shall have no obligation to maintain any minimum or
reserve amounts in the Payment Account.
4.2 Collection Account. Upon the occurrence of an Event of Default and the
exercise by the Trustee of any rights or remedies under Article 7 of this
Indenture, the Trustee shall establish an account styled the "Collection
Account" (the "Collection Account") subject to the Trustee's sole dominion and
control. Each payment received by the Trustee pursuant to any of the provisions
of the Security Documents, in connection with the Collateral or the Parent
Guaranty shall be deposited by the Trustee in the Collection Account, shall be
held in trust by it as part of the Trust Estate and shall be applied pursuant to
the provisions of Section 5.2 below. From time to time the Trustee may, and upon
receiving written direction from a Supermajority of Owners shall, transfer all
or part of funds credited to the Collection Account to the Payment Account to
effect payment to Owners.
ARTICLE 5
RECEIPT, DISTRIBUTION AND APPLICATION OF TRUST ESTATE
5.1 Application of the Payment Account When No Event of Default is
Continuing. So long as no Event of Default shall have occurred and be
continuing, the Trustee shall apply any amounts in the Payment Account as
follows:
first, to the accrued unpaid interest due and payable to the Owners
allocated pursuant to Section 5.4; and
second, to the principal due at maturity and upon prepayments of
principal, if any, allocated pursuant to Section 5.4, and
third, the balance, if any, of such payment remaining shall be
distributed to the Issuer or its assigns.
5.2 Application of Payments During Continuance of an Event of Default. All
monies held or realized in connection with the Security Documents, the
Collateral or the Parent Guaranty, or otherwise by the Trustee or the Collateral
Agent after an Event of Default shall have occurred and be continuing, as well
as all payments or amounts thereafter received by the Trustee as part of the
Trust Estate while any such Event of Default shall be continuing, shall be
applied by the Trustee as follows:
first, so much of such monies, payments or amounts as shall be
required to reimburse the Trustee and the Collateral Agent for their
services and the costs and expenses of foreclosure or suit, if any, and the
retaking, holding, preparing for sale, liquidation or other disposition of
the Collateral and reasonable attorneys fees and legal expenses incurred by
the Trustee;
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second, to any Owners for all theretofore unreimbursed payments paid
by the then existing or prior Owners pursuant to any indemnity or security
furnished to the Trustee shall be distributed to such Owners ratably,
without priority of one over the other, in the proportion that the amount
of each such unreimbursed payment of each such Owner bears to the aggregate
amount of all such unreimbursed payments by all such Owners;
third, so much of such monies, payments or amounts remaining as shall
be required to pay the unpaid principal balance due on all Outstanding
Notes, plus all accrued and unpaid interest thereon, shall be distributed
to the Owners of such Notes without priority of one such Owner over
another, and allocated pursuant to Section 5.4; and
fourth, the balance, if any, of such monies, payments or amounts shall
be distributed to the Issuer or its assigns.
5.3 Amounts Held by Trustee. Any amounts held by the Trustee in the Payment
Account or Collection Account, or pursuant to any other provision hereof or any
provision of any Security Document and which have not been applied or
distributed pursuant to the other provisions of this Indenture, may, upon
Written Request of the Issuer (or upon oral request of the Issuer, promptly
confirmed in writing), be invested by the Trustee from time to time in Permitted
Investments. All Permitted Investments shall be held in the name of the Trustee
and control thereof shall be maintained by the Trustee as provided in Section
8-106 of the UCC. Unless otherwise expressly provided in this Indenture, any
income realized as a result of any such Permitted Investment, net of the
Trustee's reasonable fees and expenses in making such Permitted Investment,
shall be held and applied by the Trustee in the same manner as the principal
amount of such Permitted Investment is to be applied and any losses, net of
earnings and such reasonable fees and expenses, shall be charged against the
principal amount invested. The Trustee shall not be liable for any loss
resulting from any investment required to be made by it under this Indenture
other than by reason of its willful misconduct or negligence, and any such
investment may be sold (without regard to its maturity or whether it is sold at
a loss) by the Trustee without instructions whenever the Trustee reasonably
believes that such sale is necessary to make a payment required by this
Indenture.
5.4 Allocation of Payments. Except for Stub Interest which shall be paid as
set forth in Section 2.10, each payment applied to the Outstanding Notes
pursuant to Articles 3, 4 or 5 shall be allocated among the Owners in proportion
to the respective outstanding principal amounts owed to each such Owner by the
Issuer. Following an Event of Default, to the extent permitted by applicable
law, the Trustee shall report all payments to Owners as first being applied to
reduce principal, and if all principal due on the Notes has been paid, as next
being applied to reduce accrued interest due on the Notes.
5.5 Method of Payment to Owners. The principal of and interest on the Notes
and all other amounts payable to the Owners of the Notes pursuant to this
Indenture will be payable at the office of the Trustee in United States dollars
in immediately available funds on the due date thereof. Owners of Notes
aggregating $500,000 or more in principal amount desiring payment in immediately
available funds may provide wire transfer information to the Registrar in
writing on or prior to the record date for such payment. The Registrar shall be
responsible for timely communicating wire transfer instructions to the Trustee
along with the Registered Owner List. Otherwise, the Trustee will effect
delivery, unless the Owner otherwise requests in writing to accept payment at
the office of the Trustee, of all amounts payable to such Owner by means of a
check or
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draft from a depository banking account maintained with the Trustee in its
individual capacity, mailed first class to such Owner to its address shown on
the Registered Owner List.
ARTICLE 6
EVIDENCE OF ACTS OF OWNERS
6.1 Execution by Note Owners or Agents. Any request, consent, demand,
authorization, direction, notice, waiver or other action provided by this
Indenture to be given or taken by Owners of the Notes may be embodied in and
evidenced by one or more instruments of substantially similar tenor and may be
signed or executed by such Owners in person or by agent or agents 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 and, where it is hereby expressly required, to the Issuer.
6.2 Future Owners Bound. Any request, consent, demand, authorization,
direction, notice, waiver or other action of Owners shall bind every future
Owner in respect of anything done or suffered to be done by the Trustee or the
Issuer in pursuance of such action irrespective of any representations made to
or information received by such future Owner from any Person.
ARTICLE 7
INDENTURE DEFAULTS - REMEDIES
7.1 Indenture Events of Default. One or more of the following events shall
constitute an " Event of Default":
(a) the Issuer shall default in the payment or prepayment when due of
any principal of or interest on any Note and such default shall continue
unremedied for a period of twenty (20) Business Days; or
(b) any representation, warranty or certification at any time made
herein or in any Security Document or any certificate furnished to the Trustee
or Collateral Agent pursuant to the provisions hereof or any Security Document,
shall prove to have been materially false or misleading as of the time made or
furnished, or the Issuer shall default in the performance of any of its other
material obligations hereunder or under the Security Documents, and such
misstatement, breach or default shall continue unremedied by Issuer (or shall
continue unwaived by the Majority of Owners) for a period of sixty (60) days
after notice thereof has been given by the Trustee to the Issuer; or
(c) the Issuer shall admit in writing its inability to pay its debts
as such debts become due; or
(d) the Issuer shall (i) apply for or consent to the appointment of,
or the taking of possession by, a receiver, custodian, trustee or liquidator of
itself or of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a voluntary case
under the United States Bankruptcy Code (as now or hereafter in effect), (iv)
file a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, winding-up, liquidation or composition
or readjustment of debts, or (v) fail to oppose in a timely and appropriate
manner, or acquiesce in writing to, any petition filed against it in an
involuntary case under the United States Bankruptcy Code, or (vi) take any
corporate action for the purpose of effecting any of the foregoing; or
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(e) a proceeding or case shall be commenced, without the application
or consent of the Issuer, in any court of competent jurisdiction, seeking (i)
its liquidation, reorganization, dissolution or winding-up, or the composition
or readjustment of its debts, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of the Issuer of all or any substantial part
of its assets, or (iii) similar relief in respect of the Issuer under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or composition
or adjustment of debts, and such proceeding or case shall continue undismissed,
or an order, judgment or decree approving or ordering any of the foregoing shall
be entered and continue unstayed and in effect, for a period of ninety (90)
days; or (iv) an order for relief against the Issuer shall be entered in an
involuntary case under the United States Bankruptcy Code.
7.2 Acceleration of Notes.
(a) Acceleration by Trustee. If an Event of Default has occurred and
is continuing, the Trustee may, and at the written direction of a Supermajority
of Owners shall, declare the entire principal of and all interest accrued on all
the Notes then Outstanding to be, and such Notes shall thereupon become,
immediately due and payable together with all interest accrued thereon. In such
case, all Outstanding Notes shall become due and payable without any
presentment, demand, protest, notice of protest, notice of acceleration or
intention to accelerate or any other notice or declaration of any kind, all of
which are hereby expressly waived by the Issuer, and the Issuer will forthwith
pay to the Trustee for the benefit of all Owners of the Notes then Outstanding
the entire principal of and interest accrued on the Notes.
(b) Nonwaiver and Expenses. No course of dealing on the part of the
Owners or Trustee or any delay or failure on the part of any Owner or the
Trustee to exercise any right shall operate as a waiver of such right or
otherwise prejudice any of their rights, powers and remedies.
7.3 Annulment of Acceleration of Notes. If a declaration of acceleration is
made pursuant to Section 7.2 by the Trustee, then a Majority of Owners may, by
written instrument filed with the Issuer and the Trustee, rescind and annul such
declaration. If a declaration of acceleration is made pursuant to Section 7.2 at
the written direction of a Supermajority of Owners, then a Supermajority of
Owners may, by written instrument filed with the Issuer and the Trustee, rescind
and annul such declaration, and the consequences thereof; provided, that no such
rescission and annulment shall (i) extend to or affect any subsequent Event of
Default or (ii) impair any right in connection therewith.
7.4 Default Remedies. If an Event of Default exists,
(a) the Trustee may, and upon receiving a written direction of a
Supermajority of Owners shall, (i) exercise all of the rights and remedies
granted to such Trustee hereunder, and/or (ii) by itself, or by direction given
to the Collateral Agent cause it to, exercise all of the rights and remedies
granted under each of the Security Documents, and/or (iii) by itself, or by
direction given to the Collateral Agent cause it to, exercise all of the rights
and remedies of a secured party under the Uniform Commercial Code. The Trustee
or the Collateral Agent on behalf of the Trustee may take possession of all or
any part of the Collateral to the exclusion of the Issuer and all Persons
claiming under the Issuer; and
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(b) the Trustee may itself or by direction given to the Collateral
Agent exercise all other rights and remedies permitted by law or in equity.
7.5 Other Enforcement Rights.
(a) The Trustee may, but unless first requested so to do by a
Supermajority of Owners and furnished with indemnity reasonably satisfactory to
it pursuant to Article 10 hereof shall not (subject to the provisions of Section
10.1) be under any obligation to, proceed to protect and enforce this Indenture,
the Notes, the Parent Guaranty and any Security Document by suit or suits or
proceedings in equity, at law or in bankruptcy, and whether for the specific
performance of any covenant or agreement herein or therein provided, or for
foreclosure or orderly liquidation thereunder, or for the appointment of a
receiver or receivers for the foreclosure thereunder, or for the appointment of
a receiver or receivers for the Trust Estate or other Collateral or any part
thereof, for the recovery of judgment for the obligations hereby secured or for
the enforcement of any other proper, legal or equitable remedy available under
applicable law.
(b) In case an Event of Default has occurred and is continuing and
there shall be pending any case or proceedings for the bankruptcy or for the
reorganization or arrangement of the Issuer, the Trustee may file such proof of
claim and other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee and of the Owners allowed in any judicial
proceedings relative to the Issuer, irrespective of whether the principal of all
of the Notes shall then be due and payable as therein expressed, by proceedings
for the prepayment thereof, by declaration or otherwise, the Trustee shall be
entitled and empowered to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Notes, and any other
sum or sums owing thereon or pursuant thereto or pursuant hereto, and to collect
and receive any or other Property payable or deliverable on any such claim, and
to distribute the same as provided in Section 5.3; and any receiver, custodian,
assignee or trustee in bankruptcy, trustee or debtor in reorganization or
trustee or debtor in any proceedings for the adoption of an arrangement is
hereby authorized by each Owner, 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 Owners, to pay to the Trustee any amount due it for compensation and
expenses, including reasonable external counsel fees, incurred by it up to the
date of such distribution; provided, however, that nothing herein contained
shall be deemed to authorize or empower the Trustee to consent to accept or
adopt, on behalf of any Owner, any plan of reorganization or readjustment of the
Issuer affecting the Notes or the rights of any Owner, or to authorize or
empower the Trustee to vote in respect of the claim of any Owner in any such
proceedings.
(c) The Issuer hereby irrevocably appoints the Trustee and the
Collateral Agent as the Issuer's attorney-in-fact and proxy, with full authority
in the place and stead of the Issuer and in the name of the Issuer or otherwise,
from time to time during the continuance of an Event of Default in the Trustee's
discretion, to take any action and to execute any instrument which the Trustee
may deem necessary or advisable to accomplish the purposes of this Indenture or
the Security Documents, including, without limitation: (a) to ask, demand,
collect, ▇▇▇ for, recover, compound, receive and give acquittance and receipts
for monies due and to become due under or in respect of any of the Collateral;
and (b) to file any claims or take any action or institute any proceedings which
the Trustee may deem necessary or desirable for the collection of any of the
Collateral or otherwise to enforce the rights of the Trustee with respect to any
of the Collateral. Without limiting the generality of the foregoing, the Trustee
and the Collateral Agent shall have the
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right to receive, collect and endorse all checks made payable to the Issuer or
the Issuer's order. If the Issuer fails to perform any act or to take any action
which hereunder or under any Security Document the Issuer is required (or has
the right) to perform or take, or to pay any money which hereunder or under any
other Security Document the Issuer is required to pay, the Trustee and\or the
Collateral Agent, in the Issuer's name or in its own name, may (but shall not be
obligated to) following notice to the Issuer perform or cause to be performed
such act or take such action or pay such money, and any expenses so incurred,
and any money so paid by the Trustee and\or the Collateral Agent, shall be a
demand obligation owing by the Issuer and shall bear interest from the date of
making such payment until paid at the Default Rate. Upon making any such
payment, the Trustee and\or Collateral Agent shall be subrogated to all of the
rights of the Person receiving such payment, which rights will be held by the
Trustee and\or Collateral Agent to secure the obligations secured hereby.
(d) Anything in this Indenture to the contrary notwithstanding, a
Supermajority of Owners shall have the right, at any time, by an instrument or
instruments in writing, executed and delivered to Trustee and\or Collateral
Agent, after providing indemnity satisfactory to the Trustee and Collateral
Agent, to direct the method and place of conducting all proceedings to be taken
by the Trustee and\or Collateral Agent in connection with the enforcement of the
terms and conditions of this Indenture and the Security Documents; provided,
however, that such direction shall not violate the express provisions of this
Indenture or applicable law.
7.6 Effect of Sale, etc.
(a) Any sale or sales pursuant to the provisions hereof or of any
other Security Document, whether under the power of sale granted hereby or
thereby or pursuant to any legal proceedings, shall operate to divest the Issuer
of all right, title, interest, claim and demand whatsoever, either at law or in
equity, of, in and to the Trust Estate or other Collateral, or any part thereof,
so sold, and any Property so sold shall be free and clear of any and all rights
of redemption by, through or under the Issuer. At any such sale, any Owner may
bid for and purchase the Property sold and may make payment therefor as set
forth below, and any Owner so purchasing any such Property, upon compliance with
the terms of sale may hold, retain and dispose of such Property without further
accountability.
(b) The receipt by any Trustee, or by any Person authorized under any
judicial proceedings to make any such sale, of the proceeds of any such sale
shall be a sufficient discharge to any purchaser of the Trust Estate or other
Collateral, or of any part thereof, sold as aforesaid; and no such purchaser
shall be bound to see to the application of such proceeds, or be bound to
inquire as to the authorization, necessity or propriety of any such sale.
7.7 Restoration of Rights and Remedies. If the Trustee shall have
instituted any proceeding to enforce any right or remedy under this Indenture or
under any other Security Document and such proceeding shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to such Trustee, then and in every such case such Trustee, the Issuer
and the Owners of the Notes shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder or under any Security Document, and thereafter all rights and remedies
of such Trustee shall continue as though no such proceeding had been instituted.
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7.8 Application of Sale Proceeds and Deficiency. The proceeds of any
exercise of rights with respect to the Trust Estate or any other Collateral, or
any part thereof, and the proceeds and the avails of any remedy hereunder shall
be deposited with the Trustee and applied as described in Sections 4.2 and 5.2.
In the event that at any time and from time to time the payments then collected
by the Trustee and the proceeds of any sale, collection or realization of or
upon Collateral are insufficient to pay all the obligations secured by this
Indenture, the Issuer shall be liable for the deficiency, together with interest
thereon at the Default Rate, together with the costs of collection and the
reasonable fees and disbursements of any attorneys employed to collect such
deficiency.
7.9 Cumulative Remedies. No delay or omission of the Trustee, the
Collateral Agent or of any one or more of the Owners to exercise any right or
power hereunder or under any Security Document in connection with any Event of
Default or failure of performance on the part of the Issuer shall exhaust or
impair any such right or power or prevent its exercise during the continuance of
Event of Default. No waiver by any Trustee, the Collateral Agent, or the Owners,
of any such Event of Default, whether such waiver be full or partial, shall
extend to or be taken to affect any subsequent default, or to impair the rights
resulting therefrom except as may be otherwise expressly provided herein. No
remedy hereunder or under any Security Document is intended to be exclusive of
any other remedy but each and every remedy shall be cumulative and in addition
to any and every other remedy given hereunder or under any Security Document or
otherwise existing; nor shall the giving, taking or enforcement of any other or
additional security, any guarantees or the Collateral for the payment of the
obligations secured under this Indenture operate to prejudice, waive or affect
the security of this Indenture or any Security Document or any rights, powers or
remedies hereunder or under any Security Document, nor shall the Trustee, the
Collateral Agent or any Owner be required to first look to, enforce or exhaust
such other or additional security, Collateral or guaranties. All covenants,
conditions, provisions, warranties, guaranties, indemnities and other
undertakings of the Issuer contained in this Indenture, or in any document
referred to herein or in any agreement supplementary hereto or in any Security
Documents shall be deemed cumulative to and not in derogation or substitution of
any of the terms, covenants, conditions, or agreements of the Issuer herein
contained. To the extent of overlap of any security interest or lien granted
hereunder or under any Security Document on any particular Collateral, the
Trustee may elect to exercise or cause the Collateral Agent to exercise rights
and remedies under either or, if appropriate, both of such security interests or
liens.
7.10 Limitations on Suits. No Owner shall have the right to institute any
suit, action or proceeding at law or in equity, for the enforcement of any trust
or power granted to the Trustee under this Indenture or any Security Document or
for any other remedy under or upon this Indenture, the Notes, or any Security
Document, unless (a) a Supermajority of Owners shall have made Written Request
upon the Trustee to exercise the powers herein granted or to institute such
action, suit or proceeding in its own name; (b) such Owners shall have offered
to the Trustee the security and indemnity reasonably satisfactory to it as
provided under Section 10.3(f); and (c) the Trustee shall have refused or failed
to comply with such Written Request for a period of thirty (30) days after such
Written Request shall have been received by it. Such notification, request,
offer of indemnity and refusal or failure are hereby declared, in every case, to
be conditions precedent to the exercise by any Owner of any remedy hereunder; it
being understood and intended that no one or more Owners of Notes shall have any
right in any manner whatever by its or their action to enforce any right under
this Indenture, the Notes or any Security Document, except in the manner herein
provided, and that all judicial proceedings to enforce any provision of this
Indenture, the Notes or any other Security Document shall be instituted, had and
maintained in the manner herein or any other Security
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Document provided and for the equal and proportionate benefit of all Owners of
the Outstanding Notes.
ARTICLE 8
AFFIRMATIVE COVENANTS
The Issuer covenants and agrees that until payment in full of all Notes
issued hereunder:
8.1 Financial Statements. The Issuer shall, at its sole expense, deliver,
or shall cause to be delivered, to the Registrar for distribution to the Owners,
as reflected on the most recent Registered Owners List, with a copy to the
Trustee:
(a) Within 120 days after the end of each fiscal year of the Issuer
the audited statements of operations, stockholders' equity and cash flow, of the
Issuer for such fiscal year, and the related balance sheet of the Issuer as at
the end of such fiscal year, and setting forth in each case in comparative form
the corresponding figures for the preceding fiscal year, accompanied by (i) the
related opinion of independent public accountants then engaged by the board of
directors of the Company to conduct its annual audit.
(b) Within 60 days after the end of each of the first three fiscal
quarterly periods of each fiscal year of the Issuer the unaudited statements of
operations and cash flows of the Issuer for such period and for the period from
the beginning of the respective fiscal year to the end of such period, and the
related balance sheets as at the end of such period, and setting forth in each
case in comparative form the corresponding figures for the corresponding period
in the preceding fiscal year, prepared in accordance with GAAP, as at the end
of, and for, such period (subject to normal year-end audit adjustments).
(c) The Trustee shall not be under any duty to check or verify any
financial statements, cash flows, balance sheets or other reports furnished
pursuant to this section, or to check, verify or compare any of such statements
or reports previously or subsequently furnished, its sole duty with respect
thereto being to distribute same to the Owners upon Written Request.
8.2 Existence, Compliance and Insurance. The Issuer shall: (i) preserve and
maintain its corporate existence and all of its material rights, privileges,
licenses and franchises reasonably necessary for the conduct of its business as
determined in good faith by its board of directors; (ii) keep proper books of
record and account; (iii) comply with relevant Governmental Requirements if
failure to comply with such requirements would have a material adverse effect on
the financial condition of the Issuer; (iv) pay and discharge, or make
appropriate reserves for, all material taxes, Liens, assessments and
governmental charges or levies imposed on it or on its income or profits or on
any material part of its Property except for any such tax, Lien, assessment,
charge, levy, account payable or claim, the payment of which is being Contested
In Good Faith; (v) permit the Trustee or a representative of a Majority of
Owners to visit and inspect, under the Issuer's guidance, any of the material
Properties of the Issuer, and to examine all of its books of account, records,
reports and other relevant papers; and (vi) keep, or cause to be kept, insured
all material Property of a character usually insured by Persons engaged in the
same or similar business similarly situated against loss or casualty.
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8.3 Further Assurances. The Issuer will cure promptly any defects in the
creation and issuance of the Notes and the execution and delivery of the
Security Documents and this Indenture. The Issuer at its expense will promptly
execute and deliver or cause to be executed or delivered to the Trustee upon
request all such other documents, agreements (including, without limitation,
account control agreements) and instruments to comply with or accomplish the
covenants and agreements of the Issuer in the Security Documents and this
Indenture, or to further evidence and more fully describe the Collateral
intended as security for the Notes, or to correct any omissions in the Security
Documents, or to state more fully the security obligations set out herein or in
any of the Security Documents, all as may be necessary or appropriate in
connection therewith.
8.4 Performance of Obligations. The Issuer will pay the Notes according to
the reading, tenor and effect thereof; and the Issuer will perform every act and
discharge all of the obligations to be performed and discharged by it under the
Security Documents.
8.5 Filings to Perfect Security Interests. The Issuer will cause this
Indenture, any and all supplemental indentures, mortgages, security agreements,
instruments of further assignment, financing statements and continuation
statements at all times to be kept recorded and filed in such manner and in such
places as may be required by law to fully preserve and protect the rights of the
Owners and the Trustee hereunder and of the Trustee and Collateral Agent under
the Security Documents. The Issuer will, at its expense and at any time and from
time to time, promptly execute and deliver or cause to be executed or delivered
all further instruments and documents and take all further action that may be
necessary or desirable or that the Trustee may request in order to (a) perfect
and protect the Liens and other rights created or purported to be created by the
Security Documents; (b) enable the Trustee and/or Collateral Agent to exercise
and enforce its rights and remedies hereunder in respect of the Collateral; or
(c) otherwise effect the purposes of this Indenture and the Security Documents,
including, without limitation: (i) executing and filing such supplements to this
Indenture and such financing or continuation statements (or amendments thereto)
as may be necessary or desirable or that the Trustee may reasonably request in
order to perfect and preserve the Liens created or purported to be created
hereby or thereby; and (ii) furnishing to the Trustee from time to time such
other information in connection with the Collateral as the Trustee may
reasonably request, all in reasonable detail.
ARTICLE 9
NEGATIVE COVENANTS
The Issuer covenants and agrees that, until payment in full of Notes issued
hereunder, all interest thereon and all other amounts payable by the Issuer
hereunder, without the prior written consent of the Required Owners:
9.1 Mergers, Etc. The Issuer will not merge into or with or consolidate
with any other Person, or sell, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
Property to any other Person unless (i) such Person is an entity created under
the laws of the United States of America or one of its states, (ii) such Person
assumes in writing all obligations of the Issuer under this Indenture, the Notes
and the Security Documents, and (iii) this Indenture and the Notes continue to
be in full force and effect.
9.2 Proceeds of Notes. Neither the Issuer nor any Person acting on behalf
of the Issuer has taken or will take any action which might cause any of the
Security Documents to violate
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Regulation T, U or X or any other regulation of the Board of Governors of the
Federal Reserve System.
9.3 Transactions with Affiliates. The Issuer will not enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property or the rendering of any service, with any Affiliate unless
such transactions are otherwise permitted under this Indenture or the Security
Documents and are upon fair and reasonable terms no less favorable to it than it
would obtain in a comparable arm's length transaction with a Person not an
Affiliate.
9.4 Jurisdiction of Incorporation. The Issuer shall not change the
jurisdiction of its incorporation to another jurisdiction unless the Issuer has
given the Trustee not less than 60 days prior written notice and the Issuer has
complied with Section 8.5 above and the Security Documents to continue the
perfection of the security interests in the Collateral in such other
jurisdiction.
ARTICLE 10
THE TRUSTEE
10.1 Certain Duties and Responsibilities of Trustee.
(a) Except during the continuance of an Event of Default of which the
Trustee has or is deemed to have notice hereunder:
(i) the Trustee undertakes to perform such duties and only such
duties 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 its part, the Trustee may
conclusively rely as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
such Trustee and conforming to the requirements of this Indenture or
Security Documents; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Indenture.
(b) In case an Event of Default has occurred and is continuing of
which the Trustee has or is deemed to have notice, the Trustee shall exercise
such of the rights and powers vested in it by this Indenture and under each of
the Security Documents for the benefit of the Owners, and use the same degree of
care and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligence or its own willful misconduct,
except that:
(i) the Trustee shall not be liable for any error of judgment
made in good faith by an officer of the Trustee unless it shall be proved
that the Trustee was negligent in ascertaining material facts; and
(ii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith after an Event of Default
shall have occurred in
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accordance with the direction of a Majority or Supermajority of Owners, as
applicable, relating to the method and place of conducting any proceeding
for any remedy available to the Trustee.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture and any Security Documents relating to the conduct or affecting
the liability of or affording protection to any Trustee shall be subject to the
provisions of this Section 10.1.
10.2 Trustee's Compensation and Expenses. The Issuer hereby covenants and
agrees:
(a) to pay to the Trustee compensation for all services rendered by it
hereunder and under the Security Documents to which the Trustee is a party in
accordance with terms agreed to from time to time (which compensation shall not
be limited by any provision of law regarding compensation of a trustee of an
express trust);
(b) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture, any other agreement relating to
the Notes to which it is a party or in complying with any request by the
Borrower with respect to the Notes, including the reasonable compensation,
expenses and disbursements of its agents and counsel, except any such expense,
disbursement or advance attributable to the Trustee's negligence or bad faith;
and
(c) to indemnify, defend and hold the Trustee and its directors,
officers, employees and agents (collectively with the Trustee, the
"Indemnitees") harmless from and against every loss, liability or expense,
including without limitation damages, fines, suits, actions, demands, penalties,
costs, out-of-pocket or incidental expenses, legal fees and expenses, the
allocated costs and expenses of in-house counsel and legal staff and the costs
and expenses of defending or preparing to defend against any claim
(collectively, "Losses"), that may be imposed on, incurred by, or asserted
against, any Indemnitee for or in respect of the Trustee's (1) execution and
delivery of this Indenture and the Security Documents, (2) compliance or
attempted compliance with or reliance upon any instruction or other direction
upon which the Trustee is authorized to rely pursuant to the terms of this
Indenture, and (3) performance of any act or duty under this Indenture or the
Security Documents, except in the case of such performance only and with respect
to any Indemnitee to the extent that such Losses resulted from such Indemnitee's
negligence or willful misconduct.
In the event the Trustee incurs expenses or renders services in any
proceedings which result from the occurrence or continuance of an Event of
Default under Sections 7.1(d) or 7.1(e), the expenses so incurred and
compensation for services so rendered are intended to constitute expenses of
administration under the United States Bankruptcy Code or equivalent law.
As security for the performance of the obligations of the Borrower under
this Section, the Trustee shall have a lien prior to the lien securing the
Notes, which it may exercise through a right of
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setoff, upon all property or funds held or collected by the Trustee pursuant to
this Indenture. The obligations of the Borrower to make the payments described
in this Section shall survive discharge of this Indenture, the resignation or
removal of the Trustee and payment in full of the Notes.
10.3 Certain Rights of Trustee. Except as otherwise provided in Section
10.1:
(a) The Trustee shall not be responsible for any recitals herein or
for insuring all or any portion of the Trust Estate nor shall the Trustee be
bound to ascertain or inquire as to the performance or observance of any
covenants, conditions or agreement contained herein. Except in the case of an
Event of Default of which a Responsible Officer of the Trustee has actual
knowledge, the Trustee shall be deemed to have knowledge of an Event of Default
only upon receipt of written notice thereof from the Issuer or any Owner.
(b) The Trustee makes no representation, or warranty as to the
validity, sufficiency or enforceability of this Indenture, the Notes, or any
Security Documents, or as to the title, operation, merchantability or fitness
for use, value of the Collateral or any substitute therefor. The Trustee shall
not be accountable to any Person for the use or application of any of the Notes
of the proceeds thereof or for the use or application of any Collateral or the
proceeds thereof which shall be released from the Lien and security interest in
accordance with the provisions of this Indenture and the Security Documents.
(c) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice request, direction, consent, order, bond, note or other
paper or document believed by it, in good faith, to be genuine and to have been
signed or presented by the proper party or parties.
(d) Any request, direction or authorization by the Issuer shall be
sufficiently evidenced by a request, direction or authorization in writing,
delivered to the Trustee, and signed in the name of such party by a Responsible
Officer; and any resolution of the Board of Directors of the Issuer or any
committee thereof shall be sufficiently evidenced by a copy of such resolution
certified by its Secretary or an Assistant Secretary to have been duly adopted
and to be in full force and effect on the date of such certification, and
delivered to such Trustee.
(e) The Trustee may consult with counsel, appraisers, accountants and
other skilled persons to be selected by such Trustee, and the written advice of
any thereof shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(f) The Trustee shall not be under any obligation to take any action
to protect, preserve or enforce any rights or interests in the Collateral or to
take any action towards the execution or enforcement of the trusts hereunder or
under the Security Documents or the Parent Guaranty, whether on its own motion
or on the request or direction of any other Person, unless the Issuer or one or
more Owners shall offer and furnish security or indemnity reasonably
satisfactory to the Trustee as to its terms, coverage, duration, amount and
otherwise with respect to the costs, expenses and liabilities which may be
incurred by it in compliance with such request or direction.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request,
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direction, consent, order, bond, note or other paper or document, unless
requested in writing to do so by a Majority of Owners and such Owners shall have
tendered funds to pay expenses to be incurred in performing such duties.
(h) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents (including
without limitation the Collateral Agent) or attorneys, and such Trustee shall
not be responsible for any misconduct or negligence on the part of any agent or
attorney appointed by it with due care.
(i) The Trustee need not post any bond for the performance of its
duties or any action taken under this Indenture.
(j) In the event the Trustee receives inconsistent or conflicting
requests and indemnity from two or more groups of Owners, each representing less
than a Majority of Owners, pursuant to the provisions of this Indenture, the
Trustee, in its sole discretion, may determine what action, if any, shall be
taken.
(k) The Trustee's immunities and protections from liability and its
right to indemnification in connection with the performance of its duties under
this Indenture shall extend to the Trustee's officers, directors, agents,
attorneys and employees. Such immunities and protections and right to
indemnification, together with the Trustee's right to compensation, shall
survive the Trustee's resignation or removal, the defeasance or discharge of
this Indenture and final payment of the Notes.
(l) The permissive right of the Trustee to take the actions permitted
by this Indenture shall not be construed as an obligation or duty to do so.
(m) Except for information provided by the Trustee concerning the
Trustee, the Trustee shall have no responsibility for any information in any
offering memorandum or other disclosure material distributed with respect to the
offer and sale of the Notes, and the Trustee shall have no responsibility for
compliance with any state or federal securities laws in connection with the
Notes or such offering.
(n) The Trustee shall have no duty to collect, preserve, exercise or
enforce rights in the Collateral (against prior parties or otherwise), except as
expressly provided herein or in the Security Documents.
10.4 Status of Monies Received. All monies 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, if the Trustee is a bank, need not be segregated
in any manner from any other monies, except to the extent required by law, and
may be deposited by such Trustee under such general conditions as may be (if
Trustee is a bank) prescribed by law and Trustee's trust department, and Trustee
shall be under no liability for interest on any monies received by it hereunder.
The Trustee may, in its individual banking capacity, become an Owner of the
Notes and may join in any action which any Owner may be entitled to take with
like effect as if it were not Trustee. The Trustee may, in its individual
banking capacity, be interested in any financial transaction with the Issuer or
any of its Affiliates; and the Trustee may act as an indenture trustee,
collateral agent, escrow agent, depository or
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otherwise in respect of the Issuer or any of its Affiliates, or as trustee or
agent for any committee of Owners, all with the same rights which it would have
if not were not the Trustee hereunder.
10.5 Resignation of Trustee. The Trustee may resign and be discharged of
the trusts hereby created by mailing notice to the Issuer and to all Owners of
Notes specifying the time and date (not earlier than thirty (30) days after the
date of such notice) when such resignation shall take effect. Such resignation
shall take effect upon the appointment, qualification and acceptance of a
successor trustee as herein provided.
10.6 Removal of Trustee. Prior to the occurrence and continuance of an
Event of Default hereunder, or after the curing or waiver of any such Event of
Default, the Issuer may remove the Trustee, with or without cause, and shall
appoint a successor Trustee. In the event there shall have occurred and be
continuing an Event of Default hereunder, a Majority of Owners may remove the
Trustee, with or without cause, and shall appoint a successor Trustee. In each
instance such removal and appointment shall be accomplished by an instrument or
concurrent instruments in writing signed by the Issuer or a Majority of Owners,
as the case may be, and delivered to the Trustee, the Issuer and all Owners. No
such resignation shall take effect until the appointment, qualification and
acceptance of a successor trustee as herein provided.
10.7 Successor Trustee. Each Trustee appointed in succession of the Trustee
named in this Indenture shall be a trust company, banking corporation, bank or
banking association organized under the laws of the United States of America or
any state thereof, in good standing and having unimpaired capital and surplus
aggregating at least $100,000,000, if there be such a trust company, banking
corporation or banking association qualified, able and willing to accept the
trusts upon reasonable or customary terms.
10.8 Appointment of Successor Trustee. If the Trustee shall have given
notice of resignation pursuant to Section 10.5 or if notice of removal shall
have been given to the Trustee pursuant to Section 10.6 and such notice does not
appoint a successor Trustee or if such notice of removal appointed a successor
Trustee and such successor shall not have accepted such appointment within
fifteen (15) days after the giving of such notice of removal, a successor
Trustee may be appointed by a Majority of Owners with the consent of the Issuer
not to be unreasonably withheld. If no such appointment shall have been made
within twenty-five (25) days after the giving of such notice of resignation or
the giving of such notice of removal, a successor Trustee may be appointed by
application of the retiring Trustee, at the expense of the Issuer, to any court
of competent jurisdiction. The Issuer shall give written notice of each
resignation or removal of the Trustee and each appointment of a successor
Trustee to each Owner. Each such notice shall include the name and address of
the applicable corporate trust office of the successor Trustee.
10.9 Merger or Consolidation of Trustee. Any corporation into which the
Trustee or any successor to it in the trusts created by this Indenture, may be
merged or consolidated or with which it or any successor to it may be
consolidated or any corporation resulting from any merger or consolidation to
which such Trustee or any successor to it shall be a party or any state or
national bank or trust company succeeding to the corporate trust business of the
Trustee as a whole or substantially as a whole (provided such corporation which
is a successor to the Trustee shall be a corporation bank or banking association
organized under the laws of the United States or any state thereof, having
unimpaired capital and surplus aggregating at least $100,000,000 and such
corporation which is a successor to any other Trustee shall be permitted by law
to perform its
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obligations hereunder), shall be the successor to such Trustee under this
Indenture without the execution or filing of any paper or any further act on the
part of any of the parties hereto. The Issuer covenants that in case of any such
merger, consolidation or transfer of the corporate trust business it will, upon
the request of the merged, consolidated or transferred corporation, execute,
acknowledge and cause to be recorded or filed suitable instruments in writing to
confirm the estates, rights and interests of such corporation as such Trustee
under this Indenture.
10.10 Acceptance of Appointment by Successor Trustee. Any new Trustee
appointed pursuant to any of the provisions hereof shall execute, acknowledge
and deliver to the Issuer and the retiring Trustee an instrument accepting such
appointment; and thereupon such new Trustee, without any further act, deed or
conveyance, shall become vested with all the estates, Properties, rights, powers
and trusts of its predecessor in the rights hereunder with like effect as if
originally named as Trustee herein (including possession of the Notes as
Depository); but, nevertheless upon the Written Request of the Issuer or the
successor Trustee, the Trustee ceasing to act, upon payment of fees and expenses
due to it, shall execute and deliver an instrument transferring to such
successor Trustee, upon the trusts herein expressed, all the estates,
Properties, rights, powers, and trusts of the Trustee so ceasing to act, and
shall duly assign, transfer and deliver any of the Property of the Trust Estate
Notes and monies held by such Trustee to the successor Trustee so appointed in
its or his place. Upon acceptance of appointment by a successor Trustee as
provided in this Section 10.9, the successor Trustee shall give to the Owners
written notice of the succession of such Trustee to the trusts hereunder.
Neither failure so to mail nor any defect in the notice so mailed shall affect
the sufficiency of the proceedings in question.
10.11 Conveyance upon Request of Successor Trustee. Should any deed,
conveyance or instrument in writing from the Issuer be required by any successor
Trustee for more fully and certainly vesting in and confirming to such new
Trustee such estates, Properties, rights, powers and trusts, then upon request
of such successor Trustee any and all such deeds, conveyances and instruments in
writing shall be made, executed, acknowledged and delivered, and, if and where
appropriate, shall be caused to be recorded and filed by the Issuer.
10.12 Co-Trustee and Collateral Agent.
(a) Delivery of Documents. Anything herein contained to the contrary
notwithstanding, if, at any time or times, in order to conform with any law of
any jurisdiction in which the Issuer or Collateral Agent shall then own or hold
any Collateral, the Trustee shall be advised by counsel satisfactory to it that
it is necessary or prudent in the interest of the Owners so to do, the Trustee
shall execute and deliver any and all instruments and agreements necessary or
proper to appoint, on behalf of the Trustee, the Owners and the Issuer, another
trust company, banking corporation or banking association, or one or more other
Persons approved by the Trustee, to act as co-trustee hereunder, jointly with
the Trustee, or as Collateral Agent; and the trust company, banking corporation
or banking association, or the Person or Persons so appointed shall be such
co-trustee or Collateral Agent, with such powers, duties and discretion as shall
be specified in the said instruments or agreements of appointment, executed as
aforesaid. It shall not be necessary for any Owner or the Issuer or any other
Person other than the Trustee to execute and deliver any such instruments or
agreements.
(b) Exercise of Powers. The rights, powers, duties and obligations
conferred or imposed upon the Trustee, any co-trustee and Collateral Agent shall
be conferred and imposed upon,
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and exercised or performed jointly or separately by the Trustee and any
co-trustee, or jointly or separately by the Trustee (and any co-trustee) and
Collateral Agent.
(c) Resignation of Co-Trustee or Separate Trustee. Each co-trustee or
Collateral Agent may resign and may be removed by the Trustee, and the
successors to such co-trustee or Collateral Agent may be appointed by the
Trustee as set forth in subsection (a) of this Section 10.12.
10.13 Registrar. The provision of this Article 10 (other than the
provisions of Sections 10.7 and 10.9), including without limitation the right to
indemnification, shall govern the rights, duties, responsibilities and
immunities of the Registrar to the maximum extent applicable.
ARTICLE 11
SUPPLEMENTAL INDENTURES, WAIVERS
11.1 Supplemental Indentures Without Note Owners' Consent. The Issuer and
the Trustee from time to time and at any time, subject to the restrictions in
this Indenture contained, may, without consent from Owners, enter into an
indenture or indentures supplemental hereto and which thereafter shall form a
part hereof for any one or more or all of the following purposes:
(a) to add to the Trust Estate held by the Trustee pursuant to the
terms hereof additional Property hereafter acquired by the Issuer and intended
to be subjected to this Indenture, and to correct and amplify the description of
any Property subject to this Indenture; and
(b) to cure any ambiguity or cure, correct or supplement any defective
provisions of this Indenture or any supplement hereto, provided, that the same
shall in no respect be materially adverse to the interests of the Owners.
The Issuer covenants to perform all requirements of any such supplemental
indenture. No restrictions or obligations imposed upon the Issuer may, except as
otherwise proved in this Indenture, be waived or modified by such supplemental
indentures or otherwise.
11.2 Waivers and Consents by Owners; Supplemental Indentures with Consent.
Except as provided in Section 11.1 above or this Section 11.2, no waivers may be
granted with respect to any provision hereof or any of the Security Documents
nor may any amendments be made to this Indenture or any of the Security
Documents without the express written consent of a Majority of Owners. Upon the
waiver or consent of a Majority of Owners: (i) the Trustee shall execute an
appropriate instrument permitting any Person to take any action prohibited, or
omit the taking of any action required, by any of the provisions of this
Indenture or any indenture supplemental hereto, or (ii) the Issuer and the
Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding, changing or eliminating any provisions of this Indenture or
of any indenture supplemental hereto or modifying in any manner the rights of
the Owners of the Notes or the rights and obligations of the Issuer hereunder;
provided, that no such waiver, consent or supplemental indenture or amendment
shall (A) impair or affect the right of any Owner to receive payments of the
principal of and payments of the interest with respect to any Note, as herein
provided including, without limitation, the timing of any such payment or the
principal amount of any Note or rate of interest thereon, without the consent of
a Supermajority of Owners, (B) permit the creation of any Lien with respect to
any of the Trust Estate without the consent of a Supermajority of Owners, (C)
deprive any Owner of the benefit of the Liens held by the Trustee and Collateral
Agent pursuant
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to the terms of this Indenture or any Security Document without the consent of a
Supermajority of Owners, (D) reduce the percentage of the aggregate principal
amount of Notes the Owners of which are required by this Section 11.2 or any
other provision of this Indenture to consent to any action, waiver or
supplemental indenture or amendment without the consent of a Supermajority of
Owners, or (E) modify the rights, duties, privileges or immunities of the
Trustee, without the written consent of the Trustee. Notwithstanding the
foregoing, unless every affected Owner consents, no supplemental Indenture shall
create any preference or priority of any Owner over any other Owner with respect
to right of payment or right to participate on a proportional basis in any
payments or benefits under this Indenture, the Notes or the Security Documents,
or in any other way deprive an Owner of the right of parity with all other
Owners with respect to right of payment or security therefor.
11.3 Notice of Supplemental Indenture. Promptly after the execution by the
Issuer and the Trustee of any supplemental indenture or promptly after the
execution by the Trustee of an appropriate instrument or permission pursuant to
the provisions of Section 11.2, the Trustee shall give written notice, setting
forth in general terms the substance of such supplemental indenture or
instrument, together with a conformed copy thereof, to each Owner. Any failure
of the Trustee to give such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such supplemental indenture or
instrument.
11.4 Solicitation of Note Owners. So long as there are any Notes
Outstanding, the Issuer will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment of any of the provisions of this
Indenture or the Notes unless each Owner shall be informed thereof by the Issuer
and shall be afforded the opportunity of considering the same and shall be
supplied by the Issuer with sufficient information to enable it to make an
informed decision with respect thereto. The Issuer will not, directly or
indirectly, pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, to any Owner as
consideration for or as an inducement to entering into by any Owner of any
waiver or amendment of any of the provisions of this Indenture or of any Note
unless such remuneration is concurrently offered to be paid, on the same terms,
ratably to the Owners of all Notes then Outstanding even if such holder did not
consent to such waiver or amendment. Such remuneration will not be inferred from
the participation by a holder of the Notes in an existing or future loan to or
investment in or with the Issuer or any of its Affiliates.
11.5 Opinion of Counsel Conclusive as to Supplemental Indentures. The
Trustee is hereby authorized to join with the Issuer in the execution of any
such supplemental indenture authorized or permitted by the terms of this
Indenture and to make the further agreements and stipulations which may be
therein contained, and the Trustee may receive an Opinion of Counsel as
conclusive evidence that any supplemental indenture executed pursuant to the
provisions of this Article 11 complies with the requirements of this Article 11.
11.6 Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article 11, this
Indenture shall be deemed to be modified and amended in accordance therewith and
the respective rights, duties and obligations under this Indenture of the
Issuer, the Trustee and all Owners shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modification and amendment,
and all the terms and conditions of any such supplemental indenture shall be
deemed to be part of the terms and conditions of this Indenture for any and all
purposes.
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ARTICLE 12
DISCHARGE AND UNCLAIMED FUNDS
12.1 Satisfaction and Discharge of Agreement. If at any time (a) the Issuer
shall pay and discharge the entire indebtedness on all Notes hereunder by paying
or causing to be paid as provided in Articles 4 and 5 the principal of and
interest on all Notes issued hereunder, as and when the same become due and
payable or (b) all Owners' interests in the Notes shall have been repurchased by
the Issuer or an Affiliate of the Issuer and the Notes canceled as herein
provided; and if the Issuer shall also pay or cause to be paid all other sums
payable hereunder by the Issuer (including, without limitation, fees and
expenses of the Trustee), and the Issuer shall fully and faithfully discharge,
and cause to be faithfully discharged, every other obligation herein and in each
of the Security Documents (including, without limitation, the Parent Guaranty)
contained, then and in that case this Indenture shall cease, determine, and
become null and void, and thereupon the Trustee shall, upon Written Request of
the Issuer forthwith execute or cause to be executed proper instruments
acknowledging satisfaction of and discharging this Indenture and releasing all
Liens held by it pursuant to the terms hereof and any Security Document. The
satisfaction and discharge of this Indenture shall be without prejudice to the
rights of the Trustee under Section 10.2 to charge and be reimbursed by the
Issuer for any expenditures which it may thereafter incur in connection
herewith.
12.2 Return of Unclaimed Monies. Notwithstanding any provisions of this
Indenture, any monies deposited with any Trustee in trust for the payment of the
principal of or interest on any Notes and remaining unclaimed for two (2) years
after the last date on which any such principal or interest payment shall have
become due and payable (whether monthly, at maturity or upon optional or
required prepayment or by declaration as provided in this Indenture), shall then
be repaid to the Issuer upon its Written Request, unless otherwise required by
mandatory provisions of applicable escheat or abandoned property laws, and the
Owners, unless otherwise required by mandatory provisions of applicable escheat
or abandoned property laws, shall thereafter be entitled to look only to the
Issuer for repayment thereof, and all liability of such Trustee with respect to
such monies shall thereupon cease; provided, however, that before the repayment
of such monies to the Issuer, as aforesaid, such Trustee shall (at the cost of
the Issuer) first mail to all Owners at their addresses as set forth in the
notice that said monies remain unclaimed and that, after a date named in said
notice, which date shall not be less than ten (10) or more than twenty (20) days
after the date of the first mailing of such notice, the balance of such monies
then unclaimed will be returned to the Issuer. In the event of the repayment of
any such monies to the Issuer as aforesaid, the Owners in respect of which such
monies were deposited shall thereafter be deemed to be unsecured creditors of
the Issuer for amounts equivalent to the respective amounts deposited for the
payment of such Notes and so repaid to the Issuer (without interest thereon and
subject to applicable escheat and abandoned property laws).
ARTICLE 13
MISCELLANEOUS
13.1 Successors and Assigns. Whenever any of the parties hereto is referred
to, such reference shall be deemed to include the successors and assigns of such
party; and all the covenants, promises and agreements in this Indenture
contained by or on behalf of the Issuer, by or on behalf of the Trustee or by or
on behalf of an Owner, shall bind and inure to the benefit of the respective
successors and assigns of such parties whether so expressed or not.
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13.2 Unenforceability of Provision.
(a) Partial Invalidity. Any provision of this Indenture that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
(b) Trustee Rights and Issuer Obligations. All rights of the Trustee
and all obligations of the Issuer hereunder shall be absolute and unconditional
irrespective of any lack of validity or enforceability of any of the Security
Documents or any other agreement or instrument relating thereto or any change in
the terms of or any amendment or waiver of or any consent to any departure from
the Security Documents or any other agreement or instrument relating thereto.
13.3 Communications. All communications provided for herein shall be in
writing or by telecommunication device capable of creating a written record and
shall be deemed to have been given when delivered by courier or actually
received by such Person listed below at its address set forth below:
If to the Issuer:
If by mail:
Castle Brands (USA) Corp.
▇▇-▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, President
If by telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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If to the Trustee:
If by mail:
JPMorgan Chase Bank
▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
If by telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Registrar:
If by mail:
Castle Brands, Inc.
▇▇-▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, President
If by telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Collateral Agent:
If by mail:
MHW, Ltd.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, President
If by telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
or to any such party at such other address as such party may
designate by notice duly given in accordance with this Section to
the other party.
Where this Indenture provides for any communication or delivery
to Owners, such communication or delivery shall be deemed to have
been given when actually received or on the second Business Day
after such communication or delivery is deposited as first class
mail with the U.S. Postal Service, addressed to such Owner at its
last address as it appears in the Owner Register.
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13.4 Governing Law. This Indenture and the Notes (including, but not
limited to, the validity and enforceability hereof and thereof) shall be
governed by, and construed in accordance with, the laws of the state of New York
other than conflict of law rules thereof that would require the application of
the laws of a jurisdiction other than such state.
13.5 Limitation on Interest. It is the intent of the parties hereto to
comply strictly with applicable usury laws, and the parties hereto stipulate and
agree that none of the terms and provisions contained in this Indenture, the
Notes or any Security Documents shall ever be construed to create a contract to
pay, for the use, forbearance or detention of money, interest in excess of the
maximum amount of interest permitted to be charged by applicable law from time
to time in effect. If any excess of interest in such respect is hereby provided
for or shall be adjudicated to be so provided, in this Indenture, in any Note or
otherwise in connection with the Security Documents, the provisions of this
Section 13.5 shall govern and prevail, and neither the Issuer nor any present or
future guarantors, endorsers, or other Persons hereafter becoming liable for
payment of the Notes shall ever be obligated to pay the excess amount of such
interest. Each of the Trustee and the Owners of the Notes expressly disavows any
intention to charge, collect or contract for excessive unearned interest or
finance charges. If the Trustee or any Owner shall receive, collect or apply
monies which are deemed to constitute interest which would otherwise increase
the interest on such Note to an amount in excess of that permitted to be charged
by applicable law then in effect, all such sums deemed to constitute interest in
excess of such legal limit shall be applied to reduce the principal balance
thereof then outstanding or immediately returned to the Issuer or the other
payor thereof upon such determination. All sums paid or agreed to be paid to the
Trustee or any Owner for the use, forbearance or detention of sums due hereunder
shall, to the extent permitted by law applicable to such party, be amortized,
prorated, allocated and spread throughout the full term of the indebtedness
evidenced by the Notes until payment in full so that the rate or amount of
interest on account of any indebtedness hereunder does not exceed the maximum
amount allowed by such applicable law. If at any time and from time to time (i)
the amount of interest payable to any holder of a Note on any date shall be
pursuant to this Section 13.5 be limited and (ii) in respect of any subsequent
interest computation period the amount of interest otherwise payable to such
holder would be less than the amount of interest payable to such holder computed
at the maximum lawful rate applicable to such holder, then the amount of
interest payable to such holder in respect to such subsequent interest
computation period shall continue to be computed at the maximum lawful rate
applicable to such holder until the total amount of interest payable to such
holder shall equal the total amount of interest which would have been payable to
such holder if the total amount of interest had been computed without giving
effect to this Section 13.5. As used in this section the term "applicable law"
means the laws of the State of New York or the laws of the United States of
America, whichever laws allow the greater rate of interest, as such laws now
exist or may be changed or amended or come into effect in the future.
13.6 Counterparts. This Indenture and any supplements hereto may be
executed, acknowledged and delivered in any number of counterparts, each of such
counterparts constituting an original but all together only one Indenture;
provided, however, that this Indenture shall not be deemed to be delivered until
at least one counterpart shall have been executed by the Issuer and the Trustee
and a counterpart so executed shall have been delivered to the Trustee at its
principal place of business specified in Section 13.3.
13.7 Headings, etc.; Gender. Any headings or captions preceding the text of
the several sections hereof are intended solely for convenience of reference and
shall not constitute a part of this
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Indenture nor shall they affect its meaning, construction or effect. Each
covenant contained in this Indenture shall be construed (absent an express
contrary provision therein) as being independent of each and every other
covenant contained herein and compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance with any and
all other covenants. All references herein or in any Security Document to the
masculine, feminine or neuter gender shall also include and refer to each other
gender not so referred to.
13.8 Amendments. This Indenture may, subject to the provisions of Article
11 hereof, from time to time and at any time, be amended or supplemented by an
instrument or instruments in writing executed by the parties hereto.
13.9 Benefits of Agreement Restricted to Parties and Owners. Nothing in
this Indenture expressed or implied is intended or shall be construed to give to
any Person other than the Issuer, the Trustee, and the Owners, any legal or
equitable right, remedy or claim under or in respect of this Indenture or any
covenant, condition or provision therein or herein contained; and all such
covenants, conditions and provisions are and shall be held to be for the sole
and exclusive benefit of the Issuer, the Trustee, and the Owners.
13.10 Waiver of Notice. Whenever in this Indenture the giving of notice is
required, the giving of such notice may be waived in writing by the Person or
Persons entitled to receive such notice.
13.11 Non-Recourse Persons. No recourse shall be had for the payment of any
amount owing in respect of any obligation of, or claim hereunder or in
connection herewith against, any employee, officer, director, or agent of the
Issuer, Trustee, any co-trustee or Collateral Agent; provided, however, that the
foregoing shall not relieve any such person or entity from any liability they
might otherwise have under applicable law.
13.12 Additional Financing Statement Filings. The Issuer hereby authorizes
the Trustee and Collateral Agent to file, without the signature of the Issuer
where permitted by law, one or more financing or continuation statements, and
amendments thereto, relating to the Collateral. The Issuer further agrees that a
carbon, photographic or other reproduction of any Security Document or any
financing statement describing any Collateral is sufficient as a financing
statement and may be filed in any jurisdiction the Trustee or Collateral Agent
may deem appropriate.
13.13 Officers' Certificate and Opinions of Counsel; Statements to be
Contained Therein.
(a) Upon any request, application or demand by the Issuer to the
Trustee to take any action under any of the provisions of this Indenture, the
Issuer shall furnish to the Trustee a certificate signed by one of its
Responsible Officers stating that all conditions precedent provided for in this
Indenture relating to the proposed action have been complied with, that no Event
of Default has occurred and is continuing, and shall be accompanied by an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent (to which a legal opinion is reasonably appropriate) have
been complied with, except that in the case of any such request, application or
demand as to which the furnishing of such documents is specifically required by
any provision of this Indenture relating to such particular request, application
or demand, no additional certificate or opinion need be furnished.
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(b) 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 (i) a statement that the person
making such certificate or opinion has read such covenant or condition, (ii) a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based, (iii) a statement that, in the opinion of such person, he 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 (iv) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
(c) Any certificate, statement or opinion of an officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or representations by counsel, unless such officer has actual
knowledge 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. Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters, upon information with respect
to which is in the possession of the Issuer, upon the certificate, statement or
opinion of or representations by a Responsible Officer or Officers of the
Issuer, unless such counsel has actual knowledge 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.
13.14 No Oral Agreements. THE INDENTURE, NOTES, PARENT GUARANTY AND
SECURITY DOCUMENTS EMBODY THE ENTIRE AGREEMENT AND UNDERSTANDING AMONG THE
PARTIES AND SUPERSEDE ALL OTHER AGREEMENTS AND UNDERSTANDINGS BETWEEN SUCH
PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF. THE SECURITY
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Indenture to be duly executed and attested by their respective officers
thereunto duly authorized, all as of the day and year first written above.
Attest: CASTLE BRANDS (USA) CORP.
/s/ ▇▇▇▇▇▇ ▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------- ------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman & CEO
Attest: JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Trustee
/s/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
------------------------------------- ------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Vice Pesident
Joined in by MHW, LTD.,
as Collateral Agent:
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President
-▇▇-
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ (▇▇▇) CORP.
No. ___________
9 % SENIOR SECURED NOTE, SERIES 2004, DUE MAY 31, 2009
NON-NEGOTIABLE
$_______________ _______________
THE SECURITY EVIDENCED HEREBY AND BENEFICIAL INTERESTS HEREIN WERE ISSUED
IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER ▇▇▇▇▇▇▇ ▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT ), AND THE SECURITY
EVIDENCED HEREBY AND BENEFICIAL INTERESTS HEREIN MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. THE OWNER OF THIS NOTE AND ANY BENEFICIAL INTERESTS HEREIN
ARE HEREBY NOTIFIED THAT THE ISSUER HAS NOT REGISTERED THIS SECURITY UNDER THE
SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS. THE OWNER OF THIS NOTE
AND ANY BENEFICIAL INTEREST HEREIN AGREES FOR THE BENEFIT OF THE ISSUER THAT
SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) IN
ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION.
Castle Brands (USA) Corp., a Delaware corporation (the Issuer), for value
received, hereby promises to pay to JPMorgan Chase Bank, National Association,
its successors and assigns (the Trustee), for the benefit of registered owners
of beneficial interests in this Note under Amended and Restated Trust Indenture
dated as of ___ ___ , 2005 (the Indenture), the principal sum of
[_______________________] Dollars ($___________) on May 31, 2009 (the Maturity
Date), and to pay interest accrued (computed on the basis of a 360-day year of
twelve 30-day months) on the unpaid principal balance from the date of this Note
at the rate of 9.00 % per annum, semi-annually, on the 31st day of each May and
the 30th day November of each year, and on the Maturity Date, with the first
payment of interest being due on November 30, 2004. The Issuer further promises
to pay on demand interest on any overdue principal, including any overdue
prepayment of principal, and or overdue installment of interest, at a rate of
interest per annum equal to the Default Rate as defined in the Indenture;
provided that interest on this Note shall in no event exceed the maximum rate
permitted by applicable law, and this Note is expressly made subject to the
interest rate limitation provisions of Section 13.5 of the Indenture.
This Note is secured as set forth in the Indenture and in the Security
Documents and is entitled to the benefits of the Parent Guaranty (as defined in
the Indenture).
Trust Indenture
Exhibit A, p. 1
This Note is transferable only by surrender thereof to a successor Trustee
and Depository under the Indenture, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of this Note or
its attorney duly authorized in writing.
Following any partial prepayment of this Note, this Note shall be made
available to the Trustee for notation hereon of the amount of principal so
prepaid. In case the entire principal amount on this Note is prepaid or paid,
this Note shall be marked paid in full by the Trustee, cancelled and returned to
the Issuer. This Note may be prepaid in whole or in part at any time without
penalty.
In any case where the date of maturity of any interest or principal owed
with respect to this Note or the date fixed for any prepayment (in whole or in
part) of this Note will not be a Business Day, then payment of such 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 such prepayment.
Under certain circumstances, as specified in the Indenture, the entire
principal amount of this Note may be declared due and payable in the manner and
with the effect provided in the Indenture.
This Note and the Indenture shall be governed by, and construed in
accordance with, the laws of the state of New York other than conflict of law
rules thereof that would require the application of the laws of a jurisdiction
other than such state.
Dated ________________, 200__
ATTEST: CASTLE BRANDS (USA) CORP.
By:
------------------------------------- ------------------------------------
Secretary Name:
----------------------------------
Title:
---------------------------------
This is one of the Notes referred to in the Indenture referred to herein
and has been duly authenticated by the Trustee as witnessed below.
JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Trustee
By:
------------------------------------
Date of authentication: Name:
------------- ----------------------------------
Title:
---------------------------------
Trust Indenture
Exhibit A, p. 2
EXHIBIT B
INSTRUCTION
REQUESTING REGISTRATION OF TRANSFER
Castle Brands, Inc.
▇▇-▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, President
Gentlemen:
TRANSFER OF NOTES. The undersigned Transferor, being a beneficial owner of
Castle Brands (USA) Corp. 9% Senior Secured Notes, Series 2004 due May 31, 2009
(the "Notes") issued in uncertificated form, hereby requests that registration
of the beneficial ownership of $____________________ principal amount of such
Notes be transferred, conveyed and assigned by book-entry from the undersigned
to the following named transferee ("Transferee"):
1. Print Full Name of Transferee: Individual:
________________________________________
First, Middle, Last
Entities: Partnership, ,Corporation,
Trust, Custodial Account, Others:
________________________________________
Legal Name of Entity
2. Mailing Address for Payment and
Notices: ________________________________________
________________________________________
3. Name of Primary Contact Person: ________________________________________
4. Telephone Number: ________________________________________
5. Facsimile Number: ________________________________________
6. Tax Identification Number ________________________________________
Trust Indenture
Exhibit B, p. 1
REPRESENTATIONS AND WARRANTIES OF THE TRANSFEREE. To induce the Company and the
Registrar to accept this transfer, the Transferee represents and warrants as
follows:
The undersigned acknowledges and agrees that no transfer of the Notes or any
interest therein will become effective until the Registrar has, on behalf of the
Company, entered the name of the Transferee in the Owner Registry.
The undersigned has the financial ability to bear the economic risk of an
investment in the Notes, has adequate means for providing for his current needs
and possible contingencies and has no need for the liquidity in this investment.
The Notes are being acquired by the Transferee for the Transferee's own account
for investment purposes only and not with a view to resale or distribution.
The Transferee understands that the Notes have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), the securities laws
of any state thereof or the securities laws of any other jurisdiction, nor is
such registration contemplated. The Transferee understands and agrees further
that the Notes must be held indefinitely unless they are subsequently registered
under the Securities Act and these laws or an exemption from registration under
the Securities Act and these laws covering the sale of Notes is available.
If the Transferee is not a natural person, (i) the Transferee has the power and
authority to execute and deliver this Transfer Request and (ii) the person
signing this Transfer Request on behalf of the Transferee has been duly
authorized to execute and deliver this Transfer Request.
The undersigned acknowledges that the Company's principal business is in
beverage alcohol and the Company is obligated to make certain disclosures to
regulatory authorities regarding its management, ownership and financing. In the
event such a disclosure is to be made, the undersigned consents to disclosure of
such data on the Transferee Questionnaire as is required by the authorities. The
undersigned further acknowledges that the laws of certain U.S. states may
preclude the holder of an interest in a US wholesaler or retailer of beverage
alcohol from also owning the Notes and/or an interest in the Company and agrees
to conform to any legal requirements that may be applicable.
INDEMNITY. To the extent permitted under applicable law, the undersigned agrees
to indemnify and hold harmless the Company, the Registrar and the Trustee, and
their respective officers and directors, employees and agents and each other
person, if any, who controls any of them, against any loss, liability, claim,
damage and expense whatsoever (including, but not limited to, any and all
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any litigation commenced or threatened or any claim whatsoever) arising
out of or based upon any false information, representation or warranty delivered
or made by the undersigned herein or in any other document furnished by the
undersigned to any of the foregoing in connection with this transaction.
Trust Indenture
Exhibit B, p. 2
IN WITNESS WHEREOF, the undersigned have executed this Instruction on the
_____ day of _________________, 200__.
INDIVIDUAL TRANSFEROR: INDIVIDUAL TRANSFEREE:
------------------------------------- ----------------------------------------
(Print Name) (Print Name)
------------------------------------- ----------------------------------------
(Signature) (Signature)
PARTNERSHIP, CORPORATION, TRUST, PARTNERSHIP, CORPORATION, TRUST,
CUSTODIAL ACCOUNT, OTHER TRANSFEROR CUSTODIAL ACCOUNT, OTHER TRANSFEREE
------------------------------------- ----------------------------------------
(Print Name of Entity) (Print Name of Entity)
By: By:
--------------------------------- ------------------------------------
(Signature) (Signature)
------------------------------------- ----------------------------------------
(Print Name and Title) (Print Name and Title)
Approved by CASTLE BRANDS (USA) Receipt acknowledged by CASTLE BRANDS,
CORP. INC., as Registrar
------------------------------------- ----------------------------------------
Date: Date:
------------------------------- ----------------------------------
Trust Indenture
Exhibit B, p. 3