EXHIBIT 4.1
EXECUTION COPY
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AFC ENTERPRISES, INC.
As Issuer
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to
UNITED STATES TRUST COMPANY OF NEW YORK
As Trustee
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Indenture
Dated as of May 21, 1997
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Up To $250,000,000
10-1/4% SENIOR SUBORDINATED NOTES DUE 2007
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AFC ENTERPRISES, INC.
Certain Sections of this Indenture relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
TIA Indenture
Section Section
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310(a) (1) .............................. 6.09
(a) (2) .............................. 6.09
(a) (3) .............................. N.A.
(a) (4) .............................. N.A.
(a) (5) .............................. 6.09
(b) .............................. 6.08
6.10
(c) .............................. N.A.
311(a) .............................. 6.13
(b) .............................. 6.13
(c) .............................. N.A.
312(a) .............................. 7.01
7.02(a)
(b) .............................. 7.02(b)
(c) .............................. 7.02(c)
313(a) .............................. 7.03(a)
(b) .............................. 7.03(a)
(c) .............................. 7.03(a)
(d) .............................. 7.03(b)
314(a) .............................. 7.04
(b) .............................. N.A.
(c)(1) .............................. 1.02
(c)(2) .............................. 1.02
(c)(3) .............................. N.A.
(d) .............................. N.A.
(e) .............................. 1.02
(f) .............................. N.A.
315(a) .............................. 6.01
(b) .............................. 6.02
(c) .............................. 6.01
(d) .............................. 6.01
(e) .............................. 5.14
316(a) .............................. 1.01
(a)(1)(A) .............................. 5.02
5.12
(a)(1)(B) .............................. 5.13
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Note: This reconciliation and tie shall not, for any purpose, be deemed to
be part of the Indenture.
TIA Indenture
Section Section
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(a)(2) ........................... N.A.
(b) ........................... 5.08
(c) ........................... 1.04
317(a)(1) ........................... 5.03
(a)(2) ........................... 5.04
(b) ........................... 10.03
318(a) ........................... 1.07
(b) ........................... N.A.
(c) ........................... 1.07
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Note: This reconciliation and tie shall not, for any purpose, be deemed to
be part of the Indenture.
-ii-
TABLE OF CONTENTS
Page
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TABLE OF CONTENTS WAS GENERATED
AND IS LOCATED AT END OF DOCUMENT
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Note: This table of contents shall not, for any purpose, be deemed to be
part of the Indenture.
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INDENTURE, dated as of May 21, 1997, among AFC ENTERPRISES,
INC., a corporation duly organized and existing under the laws of
the State of Minnesota (herein called the "Company"), having its
principal office at Six Concourse Parkway, Suite 1700, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, and UNITED STATES TRUST COMPANY OF NEW YORK, a New
York corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of 10-1/4%
Senior Subordinated Notes due 2007 (herein called the "Notes") of substantially
the tenor and amount hereinafter set forth, and to provide therefor the Company
has duly authorized the execution and delivery of this Indenture. As provided
herein, the Notes will be limited to $250,000,000 in aggregate principal amount
Outstanding, of which $175,000,000 in aggregate principal amount will be
initially issued on the date hereof. Subject to the conditions set forth
herein, the Company may issue up to an additional $75,000,000 aggregate
principal amount of Notes. The Notes may consist of either or both of Original
Notes or Exchange Notes, each as defined herein. In addition, any such
additional Notes may be initially issued in the form of Registered Notes, as
provided herein. All such Original Notes, Registered Notes and the Exchange
Notes shall rank pari passu with one another and shall together constitute a
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single class of securities.
All things necessary (a) to make the Notes, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company and (b) to make this Indenture a
valid agreement of the Company in accordance with its requirements, have been
done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes
by the Holders thereof, it is mutually
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agreed, for the equal and proportionate benefit of all Holders of the Notes, as
follows:
ARTICLE I
Definitions and Other Provisions
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of General Application
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SECTION 1.01. Definitions. For all purposes of this Indenture,
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except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP, and, except as otherwise
herein expressly provided, the term "GAAP" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted at the date of such computation;
(d) all references in this Indenture, the Notes and any Guaranties to
interest in respect of any Notes shall be deemed to include all Special
Interest, if any, in respect of such Notes, unless the context otherwise
requires, and express mention of the payment of Special Interest in any
provision hereof or thereof shall not be construed as excluding reference
to Special Interest in those provisions hereof or thereof where such
express mention is not made; all references in this Indenture, the Notes
and any Guaranties to principal in respect of any Notes shall be deemed to
include any Redemption Price or Purchase Price payable in respect of such
Notes pursuant to any redemption or Offer to Purchase hereunder (and all
such references to the Stated Maturity of the principal in respect of any
Notes shall be deemed to include the Redemption Date with respect to any
such Redemption Price and the Purchase Date with respect to any such
Purchase Price), and express mention of the payment of any Redemption Price
or Purchase Price in any provision hereof or thereof shall not be construed
as excluding reference to any Redemption Price or Purchase Price in those
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provisions hereof or thereof where such express reference is not made);
(e) unless the context otherwise requires, any reference to "Article",
"Section" or "Annex" refers to an Article or Section of or Annex to this
Indenture; and
(f) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified
in Section 1.04.
"Additional Notes" shall mean up to $75,000,000 in aggregate principal
amount of Notes initially issued subsequent to the date hereof pursuant to
Section 3.01(b) (exclusive of (x) any Exchange Notes issued pursuant to Section
3.03 in exchange for Original Notes issued on the date hereof or (y) any
Substitute Notes).
"Affiliate" shall mean, with respect to any specified Person, (i) any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person or (ii) any officer or
director of any such Person or other Person or with respect to any natural
Person, any person having a relationship with such Person by blood, marriage or
adoption not more remote than first cousin. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary for such Notes, Euroclear and Cedel, in each
case to the extent applicable to such transaction and as in effect at the time
of such transfer or transaction.
"Asset Disposition" shall mean any transfer, conveyance, sale, lease
or other disposition by the Company or any of its Subsidiaries (including a
consolidation or
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merger or other sale of any Subsidiary with, into or to another Person in a
transaction in which such Subsidiary ceases to be a Subsidiary of the Company),
of (i) shares of Capital Stock (other than directors' qualifying shares) or
other ownership interests of a Subsidiary or (ii) the property or assets of the
Company or any Subsidiary representing a division or line of business or (iii)
other assets or rights of the Company or any Subsidiary outside of the ordinary
course of business, but excluding in each case in clause (i), (ii) and (iii),
(s) a disposition by a Subsidiary of the Company to the Company or a Wholly
Owned Subsidiary or a Subsidiary Guarantor or by the Company or a Subsidiary to
a Wholly Owned Subsidiary or a Subsidiary Guarantor, (t) the disposition of all
or substantially all of the assets of the Company on a consolidated basis in a
manner permitted pursuant to the provisions of Article VIII, (u) any disposition
that constitutes a Restricted Payment or Permitted Investment that is permitted
pursuant to the provisions described in Section 10.10, (v) sale-leaseback
transactions completed within one year following the acquisition of the subject
assets, (w) sales, leases or transfers of restaurant properties to franchisees
pursuant to the Company's "turn key" development programs; (x) sales, leases or
transfers of franchises and related assets and properties repossessed or
reacquired by the Company from franchisees and subsequently resold to new
franchisees all in the ordinary course of business, (y) by sales or disposition
of (1) obsolete equipment or other assets in the ordinary course of business and
(2) restaurant-related properties and assets that are no longer in operation and
are surplus to the Company's needs in the ordinary course of business in an
amount not in excess of $5 million in any twelve month period; and (z) exchanges
of properties or assets for other properties or assets (other than cash or cash
equivalents) that (1) are useful in the business of the Company and its
Subsidiaries as then being conducted and (2) have a fair market value at least
equal to the fair market value of the assets or properties being exchanged (as
evidenced by a Board Resolution in the case of transactions having a fair market
value in excess of $1 million) in the ordinary course of business.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate Notes.
"Bank Facility" shall mean that certain Credit Agreement, dated as of
May 21, 1997, among the Company, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Credit Partners L.P., as
syndication agent and arranging agent, Canadian Imperial Bank of Commerce, as
administrative agent, and the lenders listed therein, as the same may be
amended, supplemented or otherwise modified from
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time to time (including by any extension of the maturity thereof) or as the same
may be renewed, extended, refinanced, replaced or refunded in one or more
successive transactions (including any such transaction that changes the amount
available thereunder, replaces such agreement or document, or provides for other
agents or lenders).
"Base Interest" means the interest that would otherwise accrue on the
Notes under the terms thereof and the Indenture, without giving effect to any
Special Interest.
"Board of Directors" shall mean the Board of Directors of the Company
or any committee of such Board of Directors duly authorized to act under the
Indenture.
"Board Resolution" shall mean a copy of a resolution, certified by the
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification, and delivered
to the Trustee.
"Business Day" shall mean any day other than a Saturday or Sunday or
other day on which banks in New York, New York or the city in which the
Trustee's Office is located or Atlanta, Georgia are authorized or required to be
closed.
"Capital Lease Obligation" of any Person shall mean any obligations of
such Person and its Subsidiaries on a consolidated basis under any capital lease
of a real or personal property which and to the extent, in accordance with GAAP,
has been or will be recorded as a capitalized lease obligation.
"Capital Stock" of any Person shall mean any and all shares,
interests, participations or other equivalents (however designated) of such
Person's capital stock or equity interests in the case of entities other than
corporations, whether now outstanding or issued after the date of the Indenture.
"Cash Equivalents" shall mean (i) United States dollars, (ii)
securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality, (iii) certificates of
deposit and Eurodollar time deposits with maturities of six months or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any United States domestic
commercial bank or savings and loan association having capital and surplus in
excess of $500 million and a ▇▇▇▇▇
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Bank Watch Rating of "B" or better, (iv) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clauses (ii) and (iii) entered into with any financial institution meeting the
qualifications specified in clause (iii) above, (v) commercial paper having one
of the two highest rating categories obtainable from ▇▇▇▇▇'▇ or S&P in each case
maturing within six months after the date of acquisition, (vi) readily
marketable direct obligations issued by any State of the United States of
America or any political subdivision thereof having one of the two highest
rating categories obtainable from ▇▇▇▇▇'▇ or S&P and (vii) money market mutual
funds investing substantially all of their assets in investments of the types
permitted in clauses (i) through (vi).
"Cedel" means Cedel, S.A. (or any successor securities clearing
agency).
"Change of Control" shall mean the occurrence of, after the date of
the Indenture, any of the following events: (a) any Person (other than a
Permitted Holder) or any Persons (other than any Permitted Holders) acting
together that would constitute a group (for purposes of Section 13(d) of the
Exchange Act, or any successor provision thereto), together with Affiliates
thereof (other than any Permitted Holders) (a "Group"), together with any
Affiliates thereof (other than any Permitted Holders) shall beneficially own (as
defined in Rule 13d-3 under the Exchange Act, or any successor provision
thereto) at least 50% of the aggregate voting power of all classes of Voting
Stock of the Company, (b) any Person or Group other than Permitted Holders,
becomes the beneficial owner of more than 33-1/3% of the total voting power of
the Company's Voting Stock, and the Permitted Holders beneficially own, in the
aggregate, a lesser percentage of the total voting power of the Voting Stock of
the Company than such other Person or Group and the Permitted Holders do not
otherwise have the right or ability to elect a majority of the Board of
Directors of the Company or (c) any Person (other than a Permitted Holder) or
Group (other than any Permitted Holders) together with any Affiliates thereof
(other than any Permitted Holders) shall succeed in having a sufficient number
of its nominees who are not Continuing Directors elected to the Board of
Directors of the Company such that such nominees when added to any existing
director remaining on the Board of Directors of the Company after such election
who is an Affiliate (other than any Permitted Holder) of such Group, will
constitute a majority of the Board of Directors of the Company. "Continuing
Director" shall mean any director who was a member of the Board of Directors on
the date of the issuance of the Notes or whose nomination
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for election as a director, or appointment as a director, was approved by a
majority of the Continuing Directors then in office.
"Change of Control Offer" has the meaning specified in Section 10.15.
"Change of Control Purchase Price" has the meaning specified in
Section 10.15.
"Closing Date" shall mean the date on which the Notes are originally
issued under the Indenture.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Stock" of any Person shall mean Capital Stock of such Person
that does not rank prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Order" or "Company Request" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Comparable Treasury Issue" means, on any date, the United States
Treasury Notes selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes on such date that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of a maturity
comparable to the remaining term of the Notes on such date. "Independent
Investment Banker" means ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. or, if such firm is unwilling or
unable to select the Comparable
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Treasury Issue, an independent investment banking institution of national
standing appointed by the Trustee.
"Comparable Treasury Price" means, with respect to any Redemption
Date, (a) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third Business Day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (b) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, (i) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(ii) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
Redemption Date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer at 5:00 p.m. on the third Business Day preceding such Redemption
Date.
"Consolidated EBITDA" of any Person shall mean for any period the
Consolidated Net Income for such period increased by the sum of (i) Consolidated
Interest Expense of such Person for such period, plus (ii) Consolidated Income
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Tax Expense of such Person for such period, plus (iii) the consolidated
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depreciation and amortization expense deducted in determining the Consolidated
Net Income of such Person for such period, plus (iv) any other non-cash charges
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to the extent deducted in computing Consolidated Net Income of such Person for
such period (excluding any such non-cash charge to the extent that it represents
an accrual of or reserve for cash expenditures in any future period); and minus
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(v) any non-cash charges which increased Consolidated Net Income of such Person
for such period; provided, however, that the Consolidated Income Tax Expense and
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consolidated depreciation and amortization expense of a Consolidated Subsidiary
of such Person shall be added to the Consolidated Net Income pursuant to the
foregoing only (x) to the extent and in the same proportion that the
Consolidated Net Income of such Consolidated Subsidiary was included in
calculating the Consolidated Net Income of such Person and (y) only to the
extent that the amount specified in clause (x) is not subject to restrictions
that prevent the payment of dividends or the making of distributions to such
Person.
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"Consolidated EBITDA Ratio" of any Person shall mean for any period
the ratio of (i) Consolidated EBITDA of such Person for such period to (ii) the
sum of (A) Consolidated Interest Expense of such Person for such period plus (B)
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the annual interest expense (including the amortization of indebtedness
discount) with respect to any Indebtedness incurred or proposed to be Incurred
by such Person or its Consolidated Subsidiaries since the beginning of such
period to the extent not included in clause (ii)(A) or proposed to be Incurred
as part of the transaction for which the Consolidated EBITDA Ratio is being
determined, minus (C) Consolidated Interest Expense of such Person with respect
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to any Indebtedness that is no longer outstanding or that will no longer be
outstanding as a result of the transaction with respect to which the
Consolidated EBITDA Coverage Ratio is being calculated, to the extent included
within clause (ii)(A), each such calculation to be made on a pro forma basis as
if the Indebtedness had been Incurred or paid off on the first day of such
period; provided, however, that in making such computation, the Consolidated
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Interest Expense of such Person attributable to interest on any Indebtedness
bearing a floating interest rate shall be computed on a pro forma basis as if
the rate in effect on the date of computation had been the applicable rate for
the entire period; except that (without duplication) to the extent any such
Indebtedness has been hedged pursuant to a Permitted Hedging Agreement, the
interest rate in respect thereof shall be the effective rate provided
thereunder; and provided further that, in the event such Person or any of its
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Consolidated Subsidiaries has made acquisitions or dispositions of assets not in
the ordinary course of business (including any acquisitions of any other Persons
by merger, consolidation or purchase of Capital Stock) during or after such
period, the computation of the Consolidated EBITDA Coverage Ratio (and for the
purpose of such computation, the calculation of Consolidated Net Income,
Consolidated Interest Expense, Consolidated Income Tax Expense and Consolidated
EBITDA) shall be made on a pro forma basis as if the acquisitions or
dispositions had taken place on the first day of such period.
"Consolidated Income Tax Expense" of any Person shall mean for any
period the consolidated provision for income taxes of such Person and its
Consolidated Subsidiaries for such period determined in accordance with GAAP.
"Consolidated Interest Expense" of any Person shall mean for any
period the consolidated interest expense included in a consolidated income
statement (net of interest income) of such Person and its Consolidated
Subsidiaries for such period determined in accordance with GAAP, including
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for such period without limitation or duplication (or, to the extent not so
included, with the addition of), (i) the portion of any rental obligation in
respect of any Capital Lease Obligation allocable to interest expense in
accordance with GAAP; (ii) the amortization of Indebtedness discount; (iii) any
fees with respect to letters of credit, bankers' acceptances or similar
facilities; (iv) fees with respect to Hedging Agreements to the extent it would
be permitted or required to be recorded as an adjustment to interest expense in
accordance with GAAP; (v) any Preferred Stock dividends declared and paid or
payable in cash; and (vi) any interest capitalized in accordance with GAAP, but
excluding for such period without duplication any amortization of deferred
financing fees.
"Consolidated Net Income" of any Person shall mean for any period the
consolidated net income (or loss) of such Person and its Consolidated
Subsidiaries for such period determined in accordance with GAAP; provided that
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there shall be excluded therefrom (a) the net income (or loss) of any Person
acquired by such Person or a Subsidiary of such Person in a pooling-of-interests
transaction for any period prior to the date of such transaction (subject to the
final proviso of the definition of Consolidated EBITDA Coverage Ratio when
Consolidated Net Income is being computed for purposes of calculating the
Consolidated EBITDA Coverage Ratio), (b) the net income (but not net loss) of
any Consolidated Subsidiary of such Person that is subject to restrictions that
prevent the payment of dividends or the making of distributions to such Person
to the extent of such restrictions, (c) the net income (or loss) of any Person
that is not a Consolidated Subsidiary of such Person except to the extent of the
amount of dividends or other distributions actually paid to such Person by such
other Person during such period, (d) gains or losses on asset dispositions by
such Person or its Consolidated Subsidiaries, (e) any net income (loss) of a
Consolidated Subsidiary that is attributable to a minority interest in such
Consolidated Subsidiary, (f) all extraordinary gains and extraordinary losses
and (g) the tax effect of any of the items described in Clauses (a) through (f)
above.
"Consolidated Subsidiaries" of any Person shall mean all other Persons
that would be accounted for as consolidated Persons in such Person's financial
statements in accordance with GAAP.
"Consolidated Total Assets" of any Person at any date means the
consolidated total assets of such Person and its Subsidiaries at such date, as
determined on a consolidated basis in accordance with GAAP.
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"Corporate Trust Office" shall mean the office of the Trustee
maintained in New York, New York, at which at any particular time its corporate
trust business shall be administered.
"corporation" shall mean a corporation, association, company, joint-
stock company or business trust.
"Default" shall mean any event which is, or after notice or the
passage of time or both, would be an Event of Default.
"Defaulted Interest" has the meaning specified in Section 3.08.
"Depositary" shall mean, with respect to any Notes, a clearing agency
that is registered as such under the Exchange Act and is designated by the
Company to act as Depositary for such Notes (or any successor securities
clearing agency so registered).
"Designated Senior Indebtedness" means (i) all Senior Indebtedness
under the Bank Facility and (ii) any other Senior Indebtedness (a) which at the
time of determination exceeds $20 million in aggregate principal amount or
funding commitments, (b) which is specifically designated in the instrument
evidencing such Senior Indebtedness as "Designated Senior Indebtedness" by the
Company and (c) as to which the Trustee has been given written notice of such
designation.
"DTC" shall mean The Depository Trust Company, a New York corporation.
"Eligible Institution" shall mean a bank or trust company which is
organized under the laws of the United States of America, any state thereof or
any foreign country recognized by the United States of America having capital,
surplus and undivided profits aggregating in excess of $50,000,000 (or the
foreign currency equivalent thereof) and has outstanding debt that is rated "A"
(or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor.
"Euroclear" shall mean the Euroclear Clearance System (or any
successor securities clearing agency).
"Event of Default" has the meaning specified in Section 5.01.
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"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exchange and Registration Rights Agreement" means (i) with respect to
the Notes initially issued on the date hereof, the Exchange and Registration
Rights Agreement, dated as of May 21, 1997, among the Company and the relevant
Initial Purchasers, as purchasers, and the Holders from time to time as provided
therein, as such agreement may be amended from time to time and (ii) with
respect to any Additional Notes, any Exchange and Registration Rights Agreement
entered into among the Company and the relevant initial purchasers, as
purchasers, and the Holders from time to time provided therein, as the same may
be amended from time to time.
"Exchange Offer" means an offer made by the Company pursuant to an
Exchange and Registration Rights Agreement and under an effective registration
statement under the Securities Act to Exchange Notes substantially identical in
all material respects to Outstanding Original Notes (except for the differences
provided for herein) for such Outstanding Original Notes.
"Exchange Registration Statement" means a registration statement of
the Company under the Securities Act registering Exchange Notes for distribution
pursuant to an Exchange Offer.
"Exchange Notes" means the Notes issued pursuant to an Exchange Offer
and their Successor Notes.
"Expiration Date" has the meaning specified in Section 1.04.
"Franchising Business" shall mean (i) the operation of and/or
licensing of others to operate businesses, providing products or services in a
proprietary format and subject to proprietary rights with respect to the quality
and presentation of the products or services offered and (ii) without limiting
the foregoing, each business in which the Company is engaged on the issue date.
"GAAP" shall mean generally accepted accounting principles in the
United States as in effect on the Issue Date, consistently applied.
"Global Note" means a Note that is registered in the Note Register in
the name of a Depositary or a nominee thereof.
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"Guaranty" by any Person shall mean any obligation, contingent or
otherwise, of such Person guaranteeing any Indebtedness, or dividends or
distributions on any equity security, of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, and including, without
limitation, any obligation of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness or to purchase
(or to advance or supply funds for the purchase of) any security for the payment
of such Indebtedness, (ii) to purchase property, security or services for the
purpose of assuring the holder of such Indebtedness of the payment of such
Indebtedness or (iii) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness (and "Guaranteed",
"Guaranteeing" and "Guarantor" shall have meanings correlative to the
foregoing); provided, however, that the Guaranty by any Person shall not include
-------- -------
endorsements by such person for collection or deposit, in either case, in the
ordinary course of business.
"Hedging Agreement" shall mean any interest rate, currency or
commodity swap agreement, interest rate, currency or commodity future agreement,
interest rate cap or collar agreement, interest rate, currency or commodity
hedge agreement, any put, call or other agreement relating to interest rates,
currencies or commodities or any similar agreement.
"Holder" means a Person in whose name a Note is registered in the Note
Register.
"Incur" shall mean, with respect to any Indebtedness of any Person or
any Lien securing Indebtedness, to create, issue, incur (by conversion, exchange
or otherwise), assume, Guaranty or otherwise become liable in respect of such
Indebtedness or Lien, or the taking of any other action which would cause such
Indebtedness, in accordance with GAAP to be recorded on the balance sheet of
such Person (and "Incurrence", "Incurred", "Incurrable" and "Incurring" shall
have meanings correlative to the foregoing); provided that, the Indebtedness of
--------
any other Person becoming a Subsidiary of such Person will be deemed for this
purpose to have been Incurred by such Person at the time such other Person
becomes a Subsidiary of such Person; provided, however, that a change in GAAP
-------- -------
that results in an obligation of such Person that exists at such time becoming
Indebtedness shall not be deemed an Incurrence of such Indebtedness.
14
"Indebtedness" shall mean, with respect to any Person, without
duplication, (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, notes, debentures or other
similar instruments, (iii) all obligations for the deferred purchase price of
property or services (excluding any accounts payable and other accrued current
liabilities incurred in the ordinary course of business), (iv) all obligations
of such Person in connection with any letters of credit and acceptances issued
under letter of credit facilities, acceptance facilities or other similar
facilities, now or hereafter outstanding,(v) all Capital Lease Obligations and
all obligations created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even if
the rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property) to the
extent required to be reflected as a liability in accordance with GAAP, but
excluding accounts payable arising in the ordinary course of business, (vi) the
maximum fixed redemption or repurchase price of Redeemable Interests of such
Person at the time of determination, (vii) all obligations under Hedging
Agreements of such Person, (viii) all Indebtedness referred to in clauses (i)
through (vii) above of other Persons and all dividends of other Persons, the
payment of which is secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien upon or
in property (including, without limitation, accounts and contract rights) owned
by such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness (provided that the amount of such Indebtedness
--------
under this clause shall be limited to the amount of the fair market value of the
property of such Person subject to such Lien), (ix) all Guaranteed Indebtedness
of such Person (provided that the amount of such Guaranteed Indebtedness under
--------
this clause shall be limited to the maximum amount for which such Person could
be liable with respect to the Indebtedness of another Person pursuant to the
relevant Guaranty), and (x) any amendment, supplement, modification, deferral,
renewal, extension or refunding of any liability of the types referred to in
clauses (i) through (x) above.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust
15
Indenture Act that are deemed to be a part of and govern this instrument and any
such supplemental indenture, respectively.
"Independent Investment Banker" has the meaning specified in the
definition of "Comparable Treasury Issue".
"Initial Purchasers" means the Persons named as the initial purchasers
of the Notes from the Company pursuant to a Note Purchase Agreement.
"Interest Payment Date" means the Stated Maturity of an instalment of
interest on the Notes.
"Investment" by any Person in any other Person shall mean (i) any
direct or indirect loan, advance or other extension of credit (including any
Guaranty of Indebtedness or other obligations) or capital contribution to or for
the account of such other Person (by means of any transfer of cash or other
property to any Person or any payment for property or services for the account
or use of any Person, or otherwise), (ii) any direct or indirect purchase or
other acquisition of any Capital Stock, bond, note, debenture or other
indebtedness or equity security or evidence of Indebtedness, or any other
ownership interest, issued by such other Person, whether or not such acquisition
is from such or any other Person, (iii) any direct or indirect payment by such
Person on a Guaranty of any obligation of or for the account of such other
Person or any direct or indirect issuance by such Person of such a Guaranty or
(iv) any other commitment of cash or other property by such Person in or for the
account of such other Person that is treated as an "investment" in such other
Person in accordance with GAAP.
"Issue Date" shall mean that date of original issuance of the Notes.
"Lien" shall mean any mortgage, lien (statutory or other), pledge,
security interest, encumbrance, claim, hypothecation, assignment for security,
deposit arrangement or preference or other security agreement of any kind or
nature whatsoever. A Person shall be deemed to own subject to a Lien any
property which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other title
retention agreement relating to Indebtedness of such Person.
"Marketable Securities" shall mean (i) U.S. Government Obligations;
(ii) any certificate of deposit maturing not more than 270 days after the date
of acquisition issued by, or time deposit of, an Eligible
16
Institution, (iii) commercial paper maturing not more than 270 days after the
date of acquisition issued by a corporation (other than an Affiliate of the
Company) with a rating at the time as of which any investment therein is made,
of "A-1" (or higher) according to Standard & Poor's or "P-1" (or higher)
according to ▇▇▇▇▇'▇ Investor Service, Inc., (iv) any banker's acceptances or
money market deposit accounts issued or offered by an Eligible Institution; and
(v) any fund investing exclusively investments of the types described in clauses
(i) through (iv) above.
"Material Subsidiary" shall mean a Subsidiary that, as of the end of
the most recent fiscal quarter accounted for 10% or more of the Company's
consolidated (i) total assets, (ii) shareholders' equity or (iii) operating
income (calculated for the four most recent fiscal quarters), determined in each
case in accordance with GAAP.
"Maturity" shall mean, with respect to any Note, the date on which the
principal of such Note becomes due and payable as provided in such Note or the
Indenture, whether at the Stated Maturity or by declaration of acceleration,
call for redemption or otherwise.
"Moody's" shall mean ▇▇▇▇▇'▇ Investor Service, Inc. or any successor
to the rating agency business thereof.
"Net Available Proceeds" from any Asset Disposition by the Company or
any Subsidiary shall mean cash or readily marketable cash equivalents received
(including by way of sale, discounting or payment of a note, installment
receivable or other instrument or obligation, but excluding any other
consideration received in the form of assumption by the acquiree of Indebtedness
or other obligations relating to such properties or assets or received in any
other noncash form) therefrom by such Person, net of (i) all legal, title and
recording tax expenses, commissions and other fees and expenses Incurred and all
federal, state, provincial, foreign and local taxes required to be accrued as a
liability as a consequence of such Asset Disposition, (ii) all payments made by
such Person or its Subsidiaries on any Indebtedness that is secured by such
assets in accordance with the terms of any Lien upon or with respect to such
assets or that must, by the terms of such Lien, or in order to obtain a
necessary consent to such Asset Disposition, or by applicable law, be repaid out
of the proceeds from such Asset Disposition, (iii) amounts provided as a reserve
by such Person or its Subsidiaries, in accordance with GAAP, against (a)
liabilities under any indemnification obligations to the buyer, (b) liabilities
with respect to representations and
17
warranties, (c) liabilities retained by the Company or such Subsidiary, and (d)
employee termination and similar costs relating to such Asset Disposition
(except to the extent and at the time any such amounts are released from any
such reserve, such amounts shall constitute Net Available Proceeds) and (iv) all
distributions and other payments made to minority interest holders in
Subsidiaries of such Person or joint ventures as a result of such Asset
Disposition.
"Net Offering Proceeds" of any Public Offering by any Person means the
aggregate proceeds consisting of cash and Cash Equivalents received by such
Person from such Public Offering, net of all underwriting and placement
discounts, commissions and similar costs.
"Note Purchase Agreement" means (i) with respect to the Notes
initially issued on the date hereof, the Purchase Agreement, dated as of May 16,
1997, between the Company and the Initial Purchasers named therein, as such
agreement may be amended from time to time and (ii) with respect to any
Additional Notes, any purchase or underwriting agreement entered into by the
Company and the initial purchasers or underwriters with respect thereto.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 3.06.
"Notes" has the meaning specified in the first paragraph of the
recitals to this instrument and includes the Exchange Notes.
"Notes Payment" means any payment or distribution of any kind, whether
in cash, property or securities (including any payment or distribution
deliverable by reason of the payment of any other Indebtedness subordinated to
the Notes) on account of the principal of (and premium, if any) or interest on
the Notes or on account of the purchase or redemption or other acquisition of
Notes by the Company or any Subsidiary of the Company. In the event that,
notwithstanding the foregoing, the Trustee or the Holder of any Note receives
any Notes Payment before all Senior Indebtedness of the Company is paid in full
or payment thereof is provided for in cash or Cash Equivalents or otherwise in a
manner satisfactory to the holders of such Senior Indebtedness, then and in such
event such Notes Payment will be required to be paid over or delivered forthwith
to the holders of Senior Indebtedness for application to the payment of all
Senior Indebtedness of the Company remaining unpaid, to the extent necessary to
pay such Senior Indebtedness in full.
18
"Notice of Default" means a written notice of the kind specified in
Section 5.01(d).
"Obligations" shall mean any principal (including reimbursement
obligations and guarantees), premium, if any, interest (including interest
accruing on or after the filing of, or which would have accrued but for the
filing of, any petition in bankruptcy or for reorganization relating to the
Company whether or not a claim for post-filing interest is allowed in such
proceedings), penalties, fees, expenses, indemnifications, reimbursements,
claims for rescission, damages, gross-up payments and other liabilities payable
under the documentation governing any Indebtedness or otherwise.
"Offer Document" has the meaning specified in the definition of "Offer
to Purchase".
"Offer Expiration Date" has the meaning specified in the definition of
"Offer to Purchase".
"Offer to Purchase" means an offer, set forth in a writing (the "Offer
Document") sent by the Company by first-class mail, postage prepaid, to each
Holder at his address appearing in the Note Register on the date of the Offer
Document, to purchase up to the principal amount of Notes specified in such
Offer Document at the purchase price (the "Purchase Price") specified in such
Offer Document (as determined pursuant to this Indenture). Unless otherwise
required by applicable law, the Offer Document shall specify an expiration date
(the "Offer Expiration Date") of the Offer to Purchase which shall be, subject
to any contrary requirements of applicable law, not less than 30 days or more
than 60 days after the date of such Offer Document and a settlement date (the
"Purchase Date") for the purchase of Notes within five Business Days after the
Offer Expiration Date. The Company shall notify the Trustee in writing at least
15 Business Days (or such shorter period as is acceptable to the Trustee) prior
to the mailing of the Offer Document of the Company's obligation to make an
Offer to Purchase, and the Offer Document shall be mailed by the Company or, at
the Company's request, by the Trustee in the name and at the expense of the
Company. The Offer Document shall contain information concerning the business
of the Company and its Subsidiaries which the Company in good faith believes
will enable such Holders to make an informed decision with respect to the Offer
to Purchase, which at a minimum will include (a) the most recent annual and
quarterly financial statements and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" required to be filed with the
Trustee pursuant to Section 10.16 (which requirements may be satisfied by
19
delivery of such documents together with the Offer Document), (b) a description
of material developments in the Company's business subsequent to the date of the
latest of such financial statements referred to in Clause (a) (including a
description of the events requiring the Company to make the Offer to Purchase),
(c) if applicable, appropriate pro forma financial information concerning the
Offer to Purchase and the events requiring the Company to make the Offer to
Purchase and (d) any other information required by applicable law to be included
therein. The Offer Document shall contain all instructions and materials
necessary to enable such Holder to tender Notes pursuant to the Offer to
Purchase. The Offer Document shall also state:
(i) the Section of this Indenture pursuant to which the Offer to
Purchase is being made;
(ii) the Offer Expiration Date and the Purchase Date;
(iii) the aggregate principal amount of the Outstanding Notes offered
to be purchased by the Company pursuant to the Offer to Purchase
(including, if less than 100%, the manner by which such amount has been
determined as required by this Indenture) (the "Purchase Amount");
(iv) the purchase price to be paid by the Company for each $1,000
aggregate principal amount of Notes accepted for payment (as specified
pursuant to this Indenture);
(v) that the Holder may tender all or any portion of the Notes
registered in the name of such Holder and that any portion of a Note
tendered must be tendered in an integral multiple of $1,000 principal
amount;
(vi) the place or places where Notes are to be surrendered for tender
pursuant to the Offer to Purchase;
(vii) that interest on any Notes not tendered or tendered but not
purchased by the Company pursuant to the Offer to Purchase will continue to
accrue;
(viii) that on the Purchase Date the Purchase Price will become due
and payable upon each Note accepted for payment pursuant to the Offer to
Purchase and that interest thereon shall cease to accrue after the Purchase
Date;
20
(ix) that each Holder electing to tender a Note pursuant to the Offer
to Purchase will be required to surrender such Note at the place or places
specified in the Offer Document prior to the close of business on the Offer
Expiration Date (such Note being, if the Company or the Trustee so
requires, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing and
bearing appropriate signature guarantees);
(x) that Holders will be entitled to withdraw all or any portion of
Notes tendered if the Company (or its Paying Agent) receives, not later
than the close of business on the Offer Expiration Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Notes the Holder tendered, the certificate number
of the Notes the Holder tendered and a statement that such Holder is
withdrawing all or a portion of his tender;
(xi) that (A) if Notes in an aggregate principal amount less than or
equal to the Purchase Amount are duly tendered and not withdrawn pursuant
to the Offer to Purchase, the Company shall purchase all such Notes and (B)
if Notes in an aggregate principal amount in excess of the Purchase Amount
are tendered and not withdrawn pursuant to the Offer to Purchase, the
Company shall purchase Notes having an aggregate principal amount equal to
the Purchase Amount on a pro rata basis (with such adjustments as may be
deemed appropriate so that only Notes in denominations of $1,000 or
integral multiples thereof shall be purchased); and
(xii) that in the case of any Holder whose Note is purchased only in
part, the Company shall execute, and the Trustee shall authenticate and
deliver to the Holder of such Note without service charge, a new Note or
Notes, of any authorized denomination as requested by such Holder, in an
aggregate principal amount equal to and in exchange for the unpurchased
portion of the Note so tendered.
Any Offer to Purchase shall be governed by and effected in accordance with the
Offer Document for such Offer to Purchase.
"Officers' Certificate" of the Company means a certificate signed by
the Chairman of the Board, a Vice Chairman of the Board, the President or a Vice
President,
21
and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company, as the case may be, and delivered to the Trustee.
One of the officers signing an Officers' Certificate given pursuant to Section
10.21 shall be the principal executive, financial or accounting officer of the
Company. Unless the context otherwise requires, each reference herein to an
"Officers' Certificate", shall mean an Officers' Certificate of the Company.
References herein, or in any Notes to any officer of a partnership shall mean
such officer of the partnership or, if none, of a general partner of the
partnership authorized thereby to act on its behalf.
"Opinion of Counsel" shall mean a written opinion of counsel to the
Company or any other Person (who may be an employee of the Company) reasonably
satisfactory to the Trustee.
"Original Notes" means all Notes that are subject to an Exchange and
Registration Rights Agreement, other than Exchange Notes issued in exchange
therefor.
"Outstanding", when used with respect to Notes, means, as of the date
of determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
------
(a) Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancelation;
(b) Notes for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as a Paying Agent) for the Holders of
such Notes; provided that, if such Notes are to be redeemed, notice of such
--------
redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made;
(c) Notes which have been defeased pursuant to Section 12.02; and
(d) Notes which have been issued pursuant to Section 3.07 or in
exchange for or in lieu of which other Notes have been authenticated and
delivered pursuant to this Indenture, other than any such Notes in respect
of which there shall have been presented to the Trustee proof satisfactory
to it that such Notes are held by a bona fide purchaser in whose hands such
Notes are valid obligations of the Company;
22
provided, however, that in determining whether the Holders of the requisite
-------- -------
principal amount of the Outstanding Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Notes owned by
the Company or any other obligor upon the Notes or any Affiliate of the Company
or of such other obligor shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Notes which the Trustee knows to be so owned shall be so
disregarded. Notes so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Company or any other obligor upon the Notes or any Affiliate
of the Company or of such other obligor.
"pari passu" when used with respect to the ranking of any Indebtedness
---- -----
of any Person in relation to other Indebtedness of such Person, means that each
such Indebtedness (a) either (i) is not subordinated in right of payment to any
other Indebtedness of such Person or (ii) is subordinate in right of payment to
the same Indebtedness of such Person as is the other Indebtedness and is so
subordinate to the same extent and (b) is not subordinate in right of payment to
the other Indebtedness or to any Indebtedness of such Person as to which the
other Indebtedness is not so subordinate.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Notes on behalf of the
Company.
"Permitted Hedging Agreement" of any Person shall mean any Hedging
Agreement entered into in the ordinary course of business and not for
speculation or trading purposes that is designed to protect such Person against
fluctuations in interest rates or currency exchange rates or commodity prices
with respect to Indebtedness Incurred or proposed to be Incurred or assets used
in the business in the ordinary course and which in the case of agreements
relating to interest rates shall have a notional amount no greater than the
payments due with respect to the Indebtedness being hedged thereby.
"Permitted Holder" shall mean any member of senior management of the
Company, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Incorporated or ▇▇▇▇▇▇ Asset Management, L.P., and
any successor entity thereof controlled by the principals of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ &
Co. Incorporated or ▇▇▇▇▇▇ Asset Management, L.P., as the case
23
may be, and any entity controlled by either of them or under common control with
either of them.
"Permitted Investment" shall mean (i) any Investment in a Qualified
Foreign Joint Venture (including the purchase or acquisition of any Capital
Stock of a Qualified Foreign Joint Venture) and any Investment consisting of
loans or reimbursement obligations relating to Guarantees of Indebtedness of
franchisees pursuant to the Company's "turnkey" store construction programs,
provided the aggregate amount of Investments under this clause (i) shall not
exceed $30 million at any time outstanding, (ii) accounts receivable and other
extensions of credit in the ordinary course of business, loans and advances to
employees for travel, relocation and other corporate purposes or to make
investments in the Company's Capital Stock in each case in the ordinary course
of business, (iii) any Investment in a Subsidiary, (iv) any Investment in a
Person as a result of which such Person becomes a Subsidiary, (v) any Investment
in Marketable Securities or in stock, obligations or securities received in
settlement of debts created in the ordinary course of business and owing to the
Company, (vi) Investments made as a result of the receipt of noncash
consideration from an Asset Disposition that was made pursuant to and in
compliance with the covenant described in Section 10.14, and (vii) Investments
not otherwise permitted pursuant to clauses (i) through (vi) above, in an amount
not exceeding $5 million at any time outstanding.
"Permitted Junior Securities" means any payment or distribution in the
form of equity securities or subordinated securities of the Company or any
successor obligor provided for by a plan of reorganization or readjustment that,
in the case of any such subordinated securities, are subordinated in right of
payment to all Senior Indebtedness that may at the time be outstanding to at
least the same extent as the Notes are so subordinated as provided in this
Indenture.
"Person" shall mean any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Note" of any particular Note means every Note issued
before, and evidencing all or a portion of the same debt as that evidenced by,
such particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 3.07 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen
24
Note shall be deemed to evidence the same debt as the mutilated, destroyed, lost
or stolen Note.
"Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of such Person of any class or classes (however designated)
that ranks prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
The amount of any Preferred Stock shall be the highest of at the time of
determination (i) the liquidation value thereof, (ii) the maximum fixed
redemption price thereof and (iii) the maximum fixed repurchase price hereof.
"Public Offering" means any underwritten public offering of Common
Stock pursuant to a registration statement filed under the Securities Act.
"Purchase Amount" has the meaning specified in the definition of
"Offer to Purchase".
"Purchase Date" has the meaning specified in the definition of "Offer
to Purchase".
"Purchase Price" has the meaning specified in the definition of "Offer
to Purchase".
"Qualified Foreign Joint Venture" shall mean a corporation,
partnership or other entity (x) formed to be, or currently, engaged in the
Franchising Business outside the United States as a franchise of the Company and
(y) in which the Company owns, directly or indirectly, a 10% or greater
interest.
"Redeemable Interest" of any Person shall mean any equity security of
or other ownership interest in such Person that by its terms (or by the terms of
any security into which it is convertible or for which it is exchangeable) or
otherwise (including upon the occurrence of an event) matures or is required to
be redeemed (pursuant to any sinking fund obligation or otherwise) or is
convertible into or exchangeable for Indebtedness or is redeemable at the option
of the holder thereof, in whole or in part, at any time prior to the final
Stated Maturity of the Notes.
"Redemption Date" shall mean each date fixed for redemption pursuant
to the provisions described under "Optional Redemption".
"Refinance" shall have the meaning provided in Section 10.08.
25
"Registered Notes" means Exchange Notes and all other Notes sold or
otherwise disposed of pursuant to an effective registration statement under the
Securities Act, including, as applicable, (i) all Original Notes sold pursuant
to a Shelf Registration Statement, (ii) all Exchange Notes and (iii) all
Additional Notes initially offered and sold pursuant to a registration statement
under the Securities Act, together with their respective Successor Notes.
"Registration Default" means the occurrence of any of the following
events: (a) the Company has not filed the Exchange Registration Statement or
Shelf Registration Statement on or before the date on which such registration
statement is required to be filed pursuant to the Exchange and Registration
Rights Agreement, (b) the Exchange Registration Statement or Shelf Registration
Statement has not become effective or been declared effective by the Commission
on or before the date on which such registration statement is required to become
or be declared effective under the requirements of the Exchange and Registration
Rights Agreement, (c) the Exchange Offer has not been completed within 45 days
after the initial effective date of the Exchange Registration Statement relating
to the Exchange Offer (if the Exchange Offer is then required to be made under
the Exchange and Registration Rights Agreement) or (d) any Exchange Registration
Statement or Shelf Registration Statement required to be filed pursuant to the
Exchange and Registration Rights Agreement is filed and declared effective but
shall thereafter either be withdrawn by the Company or shall become subject to
an effective stop order issued pursuant to Section 8(d) of the Securities Act
suspending the effectiveness of such registration statement (except as
specifically permitted herein) without being succeeded immediately by an
additional registration statement filed and declared effective.
"Registration Default Period" means any period during which a
Registration Default has occurred and is continuing.
"Regular Record Date" for the interest payable on any Interest Payment
Date means May 1 and November 1 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date.
"Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Regulation S Certificate" means a certificate substantially in the
form set forth in Annex A.
26
"Regulation S Global Notes" has the meaning specified in Section 2.01.
"Regulation S Legend" means a legend substantially in the form of the
legend required in the form of Notes set forth in Section 2.02 to be placed upon
Regulation S Notes.
"Regulation S Notes" means all Notes required pursuant to Section
3.06(c) to bear a Regulation S Legend. Such term includes the Regulation S
Global Notes.
"Regulatory Shares" shall mean shares issued to Persons other than the
Company or a Wholly Owned Subsidiary in response to regulatory requirements of
foreign jurisdictions pursuant to a resolution of the Board of Directors, so
long as such shares do not exceed 1% of the total outstanding shares and any
owners of such shares irrevocably covenant with the Company to remit to the
Company or waive any dividends or distributions paid or payable in respect of
such shares.
"Reinvested Amounts" has the meaning specified in Section 10.14(a).
"Related Person" of any Person shall mean, without limitation, any
other Person owning (a) 5% or more of the outstanding Common Stock of such
Person or (b) 5% or more of the Voting Stock of such Person.
"Required Filing Dates" has the meaning specified in Section 10.16.
"Restricted Global Notes" has the meaning specified in Section 2.01.
"Restricted Notes" means all Notes required pursuant to Section
3.06(c) to bear a Restricted Notes Legend. Such term includes the Restricted
Global Notes.
"Restricted Notes Certificate", means a certificate substantially in
the form set forth in Annex B.
"Restricted Notes Legend" means a legend substantially in the form of
the legend required in the form of Notes set forth in Section 2.02 to be placed
upon a Restricted Note.
"Restricted Payments" shall have the meaning specified in Section
10.10.
"Restricted Period" means the period of 41 consecutive days beginning
on and including the later of
27
(a) the day on which Notes are first offered to persons other than distributors
(as defined in Regulation S) in reliance on Regulation S and (b) the last
original issue date of the Notes.
"Rule 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"Rule 144A Notes" means the Notes purchased by the Initial Purchasers
from the Company pursuant to a Note Purchase Agreement, other than Regulation S
Notes or Registered Notes.
"Securities Act" means the Securities Act of 1933 (or any successor
statute), as it may be amended from time to time.
"Securities Act Legend" means a Restricted Notes Legend or a
Regulation S Legend.
"Senior Indebtedness" means with respect to the Company (x)
Indebtedness created pursuant to the Bank Facility, (y) Indebtedness of the
types referred to in Clauses (i), (ii), (iv), (v) and (vii) of the definition of
Indebtedness, whether incurred on or prior to the date of the Indenture or
thereafter Incurred and (z) Guaranties by the Company of any Indebtedness of the
type referred to in the foregoing clause (y); provided, however, the following
-------- -------
shall not constitute Senior Indebtedness: (1) any Indebtedness owed to a Person
when such Person is a Subsidiary of the Company, (2) any Indebtedness which by
the terms of the instrument creating or evidencing the same is expressly made
pari passu or subordinate in right of payment to the Notes, (3) any Indebtedness
---- -----
Incurred in violation of the Indenture to the extent of such violation, (4) any
Indebtedness which is subordinate in right of payment in any respect to any
other Indebtedness of the Company or (5) any Indebtedness constituting trade
payables, state or Federal taxes. For purposes of this definition,
"Indebtedness" includes any obligation to pay principal, premium (if any),
interest, penalties, reimbursement or indemnity amounts, fees and expenses
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-petition interest is allowed in such proceeding).
"Shelf Registration Statement" means a shelf registration statement
under the Securities Act filed by the Company, if required by, and meeting the
requirements of, an
28
Exchange and Registration Rights Agreement, registering Original Notes for
resale.
"Special Interest" has the meaning specified in the form of the Notes
set forth in Section 2.02.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Company pursuant to Section 3.08.
"S&P" shall mean Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., or any successor to the rating agency business thereof.
"Stated Maturity," when used with respect to the principal of any
Indebtedness or any installment of interest thereof, shall mean the date
specified in such Indebtedness as the fixed date on which the principal of such
Indebtedness or such installment of interest is due and payable.
"Subsidiary" of any Person shall mean (i) any corporation of which
more than 50% of the outstanding shares of Capital Stock having ordinary voting
power for the election of directors is owned directly or indirectly by such
Person and (ii) any partnership, limited liability company, association, joint
venture or other entity in which such Person, directly or indirectly, has more
than a 50% equity interest, and, except as otherwise indicated herein,
references to Subsidiaries shall refer to Subsidiaries of the Company.
"Subsidiary Guaranty" shall mean an unconditional senior subordinated
guaranty of the Notes pursuant to a supplemental indenture to this Indenture as
provided for in Section 9.07. Each Subsidiary Guaranty shall terminate by its
terms upon such Subsidiary ceasing to be a Subsidiary upon (i) a disposition of
all of the Capital Stock of such Subsidiary owned by the Company to a Person
other than an Affiliate of the Company or (ii) the merger, consolidation or
liquidation of such Subsidiary with another Person (other than an Affiliate of
the Company and other than in circumstances where the survivor would be a
Subsidiary).
"Subsidiary Guarantor" shall mean a Subsidiary of the Company that
shall have executed and delivered to the Trustee (i) a supplemental indenture
providing for a Subsidiary Guaranty as provided in Sections 9.01 and 9.07 and
such Subsidiary Guaranty shall be in full force and effect and (ii) certain
Opinions of Counsel as provided for in Section 9.07.
29
"Substitute Note" shall have the meaning specified in Section 3.01.
"Successor Note" of any particular Note means every Note issued after,
and evidencing all or a portion of the same debt as that evidenced by, such
particular Note; and, for purposes of this definition, any Note authenticated
and delivered under Section 3.07 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Note shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Note.
"Surviving Entity" shall have the meaning specified in Section 8.01.
"Treasury Yield" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such Redemption Date.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
-------- -------
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee", shall mean such successor Trustee.
"U.S. Government Obligations" means securities that are (x) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (y) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such
30
depository receipt; provided that (except as required by law) such custodian is
--------
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the U.S. Government Obligation or the specific payment of principal of or
interest on the U.S. Government Obligation evidenced by such depository receipt.
"Unrestricted Notes Certificate" means a certificate substantially in
the form set forth in Annex C.
"Vice President", when used with respect to the Company, or the
Trustee, means any vice president of such Person, whether or not designated by a
number or a word or words added before or after the title "vice president" and
shall also include the Chief Financial Officer.
"Voting Stock" shall mean stock of the class or classes pursuant to
which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of a corporation (irrespective of whether or not at the time, stock
of any other class or classes shall have or might have voting power by reason of
the happening of any contingency).
"Weighted Average Life" shall mean, as of any date, with respect to
any indebtedness security, the quotient obtained by dividing (i) the sum of the
products of the number of years from such date to the dates of each successive
scheduled principal payment (including any sinking fund payment requirements) of
such indebtedness security multiplied by the amount of such principal payment,
by (ii) the sum of all such principal payments.
"Wholly Owned Subsidiary" of any Person shall mean a Subsidiary of
such Person, all of the Capital Stock (other than Directors' qualifying shares
or Regulatory Shares) or other ownership interests of which shall at the time be
owned by such Person or by one or more Wholly Owned Subsidiaries of such Person
or by such Person and one or more Wholly Owned Subsidiaries of such Person.
SECTION 1.02. Compliance Certificates and Opinions. Upon any
-------------------------------------
application or request by the Company to the Trustee to take or refrain from
taking any action under any provision of this Indenture, the Company shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act or this Indenture. Each such certificate or opinion
shall be given in the form of an Officers' Certificate, if to be given by an
officer of the Company, or an Opinion of Counsel, if to be given by
31
counsel, and shall comply with the requirements of the Trust Indenture Act and
any other requirement set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether or not, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Trustee. In any case
---------------------------------------
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in
32
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous. Opinions of Counsel
required to be delivered to the Trustee may have qualifications customary for
opinions of the type required and counsel delivering such Opinions of Counsel
may rely on certificates of the Company or government or other officials
customary for opinions of the type required, including certificates certifying
as to matters of fact, including that various financial covenants have been
complied with.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. Acts of Holders; Record Dates. Any request, demand,
------------------------------
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments (and, for each instrument signed by an agent, the writing duly
appointing such agent as agent of any Holders) are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 6.01) conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
33
The ownership of Notes shall be proved by the Note Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Note shall bind every future Holder of the
same Note and the Holder of every Note issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Note.
The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes entitled to give, make or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given, made or taken by
Holders of Notes; provided that the Company may not set a record date for, and
--------
the provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next
paragraph. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Notes on such record date (or their duly appointed proxies), and no
other Holders, shall be entitled to take the relevant action, whether or not
such Holders remain Holders after such record date; provided that no such action
--------
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date (as defined herein) by Holders of the requisite principal amount
of Outstanding Notes on such record date. Nothing in this paragraph shall be
construed to prevent the Company from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be canceled and of no effect), and nothing in this paragraph shall
be construed to render ineffective any action taken by Holders of the requisite
principal amount of Outstanding Notes on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Trustee in
writing and to each Holder of Notes in the manner set forth in Section 1.06.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes entitled to join in the giving or
making of (a) any Notice of Default, (b) any declaration of acceleration
referred to in Section 5.02, (c) any request to institute proceedings referred
to in Section 5.07(b) or (d) any direction referred
34
to in Section 5.12. If any record date is set pursuant to this paragraph, the
Holders of Outstanding Notes on such record date (or their duly designated
proxies), and no other Holders, shall be entitled to join in such notice,
declaration, request or direction, whether or not such Holders remain Holders
after such record date; provided that no such action shall be effective
--------
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Notes on such record date.
Nothing in this paragraph shall be construed to prevent the Trustee from setting
a new record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be canceled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding Notes
on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Notes in the manner set forth in Section 1.06.
With respect to any record date set pursuant to this Section, the
party hereto which sets such record date may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
--------
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of Notes in the manner set forth in Section 1.06, on
or prior to the existing Expiration Date. If an Expiration Date is not
designated with respect to any record date set pursuant to this Section, the
party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled to take any action
hereunder with regard to any particular Note may do so with regard to all or any
part of the principal amount of such Note or by one or more duly appointed
agents each of which may do so pursuant to such appointment with regard to all
or any part of such principal amount.
35
SECTION 1.05. Notices, etc., to Trustee and Company. Any request,
--------------------------------------
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with:
(a) the Trustee by any Holder, the Company, or any holder of or agent
for any Senior Indebtedness of the Company, shall be sufficient for every
purpose hereunder if made, given, furnished or filed in writing and hand
delivered, mailed with first-class postage prepaid, sent by facsimile or
delivered by recognized overnight courier to or with the Trustee at its
Corporate Trust Office, Attention: Corporate Trust Administration,
facsimile number: ▇▇▇-▇▇▇-▇▇▇▇, or at any other address or facsimile
number previously furnished in writing to the Holders, the Company or any
holder of or agent for any Senior Indebtedness of the Company by the
Trustee; or
(b) the Company by the Trustee, any Holder or any holder of or agent
for any Senior Indebtedness of the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if in
writing and hand delivered, mailed with first-class postage prepaid, sent
by facsimile or delivered by recognized overnight courier to it at the
address of the Company's principal office specified in the first paragraph
of this instrument (facsimile number: 770-353-3028) or at any other
address or facsimile number previously furnished in writing to the Trustee,
the Holders or any holder of or agent for any Senior Indebtedness of the
Company by the Company.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail with first-class postage prepaid, if
mailed; when receipt acknowledged, if sent by facsimile; and the next Business
Day after timely delivery to the courier, if sent by recognized overnight
courier guaranteeing next-day delivery.
SECTION 1.06. Notice to Holders; Waiver. Where this Indenture
--------------------------
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and hand
delivered, mailed with first-class postage prepaid or delivered by recognized
overnight courier, to each Holder affected by such event, at his address as it
appears in the Note Register, not later than the latest date (if any), and not
earlier than the earliest date (if any), prescribed for the
36
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail with first-class postage prepaid, if
mailed; and the next Business Day after timely delivery to the courier, if sent
by a recognized overnight courier guaranteeing next-day delivery.
SECTION 1.07. Conflict with Trust Indenture Act. If any provision
----------------------------------
hereof limits, qualifies or conflicts with a provision of the Trust Indenture
Act that is required under such Act to be a part of and govern this Indenture,
the latter provision shall control. If any provision of this Indenture modifies
or excludes any provision of the Trust Indenture Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Indenture as so
modified or to be excluded, as the case may be. Until such time as this
Indenture shall be qualified under the Trust Indenture Act, this Indenture, the
Company and the Trustee shall be deemed for all purposes hereof to be subject to
and governed by the Trust Indenture Act to the same extent as would be the case
if this Indenture were so qualified on the date hereof.
SECTION 1.08. Effect of Headings and Table of Contents. The Article
-----------------------------------------
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
37
SECTION 1.09. Successors and Assigns. All covenants and agreements
----------------------
in this Indenture by the Company shall bind its successors and assigns, whether
so expressed or not.
SECTION 1.10. Separability Clause. In case any provision in this
--------------------
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 1.11. Benefits of Indenture. Nothing in this Indenture or in
----------------------
the Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, the Holders of Notes and the holders of
any Senior Indebtedness, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 1.12. GOVERNING LAW. THIS INDENTURE AND THE NOTES SHALL BE
--------------
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
(WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PRINCIPLES THEREOF).
SECTION 1.13. Legal Holidays. In any case where any Interest Payment
---------------
Date, Redemption Date, Purchase Date or Stated Maturity of any Notes shall not
be a Business Day, then (notwithstanding any other provision of this Indenture
or of the Notes or any Subsidiary Guaranty) payment of interest or principal
(and premium, if any) 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
Interest Payment Date, Redemption Date or Purchase Date or at the Stated
Maturity; provided that no interest shall accrue for the period from and after
--------
such Interest Payment Date, Redemption Date, Purchase Date or Stated Maturity,
as the case may be.
SECTION 1.14. No Recourse Against Others. A director, officer,
---------------------------
employee, stockholder or incorporator, as such, of the Company or any of its
Subsidiaries shall not have any liability for any obligations of the Company or
any of its Subsidiaries under the Notes or this Indenture for any claim based
on, in respect of or by reason of such obligations or their creation. Each
Holder by accepting a Note waives and releases all such liability. Such waiver
and release are part of the consideration for the issuance of the Notes.
38
ARTICLE II
Notes Forms
-----------
SECTION 2.01. Forms Generally; Initial Forms of Rule 144A and
-----------------------------------------------
Regulation S Notes. The Notes and the Trustee's certificates of authentication
-------------------
shall be in substantially the forms set forth in this Article, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may be required to comply with law or the rules of any securities exchange or as
may, consistently herewith, be determined by the officers executing such Notes
as evidenced by their execution thereof.
The definitive Notes shall be printed, lithographed or engraved or
produced by any combination of these methods on steel engraved borders or may be
produced in any other manner permitted by the rules of any securities exchange
on which the Notes may be listed, all as determined by the officers executing
such Notes as evidenced by their execution thereof.
Upon their original issuance, Rule 144A Notes shall be issued in the
form of one or more Global Notes registered in the name of DTC, as Depositary,
or its nominee and deposited with the Trustee, as custodian for DTC, for credit
by DTC to the respective accounts of beneficial owners of the Notes represented
thereby (or such other accounts as they may direct). Such Global Notes,
together with their Successor Notes which are Global Notes other than the
Regulation S Global Notes are collectively herein called the "Restricted Global
Notes".
Upon their original issuance, Regulation S Notes shall be issued in
the form of one or more Global Notes registered in the name of DTC, as
Depositary, or its nominee and deposited with the Trustee, as custodian for DTC,
for credit by DTC to the respective accounts of beneficial owners of the Notes
represented thereby (or such other accounts as they may direct); provided that
--------
upon such deposit all such Notes shall be credited to or through accounts
maintained at DTC by or on behalf of Euroclear or Cedel. Such Global Notes,
together with their Successor Notes which are Global Notes other than the
Restricted Global Notes are collectively herein called the "Regulation S Global
Notes".
39
SECTION 2.02. Form of Face of Notes. [IF THE NOTE IS A RESTRICTED
----------------------
NOTE, THEN INSERT -- THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.]
[IF THE NOTE IS A REGULATION S NOTE, THEN INSERT -- THIS NOTE HAS NOT
BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD OR DELIVERED IN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON, UNLESS THIS
NOTE IS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE.]
[IF THE NOTE IS A GLOBAL NOTE, THEN INSERT -- THIS IS A GLOBAL NOTE
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED
IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE
OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH
DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE.]
[IF THE NOTE IS A GLOBAL NOTE AND THE DEPOSITORY TRUST COMPANY IS TO
BE THE DEPOSITARY THEREFOR, THEN INSERT -- UNLESS THIS CERTIFICATE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
40
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
AFC ENTERPRISES, INC.
10-1/4% SENIOR SUBORDINATED NOTES DUE 2007
[If Restricted Global Note - CUSIP No.[ ]]
[If Regulation S Note - CUSIP No.[ ]]
[If Regulation S Global Note - ISIN No.[ ]]
No. $
-------------- -----------------
AFC Enterprises, Inc., a corporation duly organized and existing under
the laws of Minnesota (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to ____________, or registered assigns, the
principal sum of ______________ Dollars [IF THE NOTE IS A GLOBAL NOTE, THEN
INSERT -- , or such other principal amount (which, when taken together with the
principal amounts of all other Outstanding Notes, shall not exceed $250,000,000
in the aggregate at any time) as may be set forth in the records of the Trustee
hereinafter referred to in accordance with the Indenture,] on May 15, 2007 and
to pay interest thereon from the date of original issuance of this Note or any
Predecessor Note (including in the case of any Exchange Note any Original Note
exchanged therefor) or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually on May 15 and
November 15 in each year commencing on [INSERT FIRST INTEREST PAYMENT DATE], at
the rate of 10 1/4% per annum, until the principal hereof is paid or made
available for payment; provided that any amount of principal of (and premium, if
--------
any) and interest on this Note which is overdue shall bear interest (to the
extent that payment thereof shall be legally enforceable) at the rate of 12-1/4%
per annum, from the date such amount is due to the day it is paid or made
available for payment, and such overdue interest shall be payable on demand [IF
THE NOTE IS AN ORIGINAL NOTE THAT IS SUBJECT TO AN EXCHANGE AND REGISTRATION
RIGHTS AGREEMENT, THEN INSERT -- ; provided further that, if any Registration
-------- -------
Default occurs under the Exchange and Registration Rights Agreement applicable
hereto, as liquidated damages for such Registration Default, special interest
("Special Interest"), in addition to the Base Interest, shall accrue during the
Registration Default Period for such Registration Default at a per annum rate of
0.25% for the first 90 days of such Registration Default Period, at a per annum
rate of 0.50% for the second 90 days of such Registration Default Period, at a
per annum rate of 0.75% for the third 90 days of such Registration Default
41
Period and at a per annum rate of l.0% thereafter for the remaining portion of
such Registration Default Period. Such Special Interest will be payable in cash
semiannually in arrears on each Interest Payment Date; and the amount of accrued
Special Interest shall be determined on the basis of the number of days actually
elapsed].
The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Regular Record Date for such interest, which
shall be the May 1 or November 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date [IF THE NOTE IS AN ORIGINAL
NOTE, THEN INSERT --; provided that any accrued and unpaid interest (including
--------
Special Interest, if any) on this Note upon the issuance of an Exchange Note in
exchange for this Note shall cease to be payable to the Holder hereof and shall
be payable on the next Interest Payment Date for such Exchange Note to the
Holder thereof on the related Regular Record Date]. Any such interest not so
punctually paid or duly provided for, and interest on such Defaulted Interest at
the interest rate borne by the Notes, to the extent lawful, will forthwith cease
to be payable to the Holder on the relevant Regular Record Date and may either
be paid to the Person in whose name this Note (or one or more Predecessor Notes)
is registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Company, with the consent of the
Trustee, notice whereof shall be given to Holders of Notes not less than 10 days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements (if applicable) of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
Interest on this Note shall be computed on the basis set forth in the Indenture.
[IF THE NOTE IS A GLOBAL NOTE, THEN INSERT -- All payments in respect
of this Note will be payable to the holder of the Global Note in its capacity as
the registered Holder under the Indenture.] [IF THE NOTE IS NOT A GLOBAL NOTE,
THEN INSERT -- Payment of the principal of (and premium, if any) and interest on
this Note will be made at the office or agency of the Company in the Borough of
Manhattan, The City of New York, New York, maintained for such purpose and at
any other office or agency maintained by the Company for such purpose, in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts;
42
provided, however, that at the option of the Company payment of interest may be
-------- -------
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Note Register; provided further, that all payments
----------------
of the principal (and premium, if any) and interest on Notes, the Holders of
which have given wire transfer instructions to the Company or its agent at least
10 Business Days prior to the applicable payment date will be required to be
made by wire transfer of immediately available funds to the accounts specified
by such Holders in such instructions.]
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
AFC ENTERPRISES, INC.
[SEAL] By:_________________________________________
Attest:
------------------------------------------
SECTION 2.03. Form of Reverse of Notes. This Note is one of a duly
-------------------------
authorized issue of Notes of the Company designated as its 10-1/4% Senior
Subordinated Notes due 2007 (herein called the "Notes"), issued and to be issued
under an Indenture, dated as of May 21, 1997 (herein called the "Indenture",
which term shall have the meaning assigned to it in such instrument), among the
Company and United States Trust Company of New York, as Trustee (herein called
the "Trustee", which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights,
43
duties and immunities thereunder of the Company, the Trustee, the holders of the
Senior Indebtedness and the Holders of the Notes and of the terms upon which the
Notes, are, and are to be, authenticated and delivered. The Notes will be
limited to $250,000,000 in aggregate principal amount Outstanding of which
$175,000,000 in aggregate principal amount was initially issued on May 21, 1997.
The Notes are redeemable, at the option of the Company, as a whole or
in part, at any time on or after May 15, 2002 at the Redemption Prices
(expressed as percentages of the principal amount thereof) set forth below
together with accrued and unpaid interest to the Redemption Date, if redeemed
during the 12-month period beginning on May 15 of the years indicated:
Redemption
Year Price
2002.................. 105.125%
2003.................. 103.416%
2004.................. 101.708%
2005 and thereafter... 100.000%
At any time, or from time to time, prior to May 15, 2000, up to 40% in
aggregate principal amount of Notes originally issued under the Indenture will
be redeemable, at the option of the Company, from the net proceeds of one or
more Public Offerings of Capital Stock (other than Redeemable Interests) of the
Company, at a Redemption Price equal to 110.25% of the principal amount thereof,
together with accrued but unpaid interest, if any, to the Redemption Date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on an Interest Payment Date that is on or prior to the
Redemption Date); provided that the notice of redemption with respect to any
--------
such redemption is mailed within 60 days following the closing of the
corresponding public offering; and provided further that following such
----------------
redemption at least $100 million in aggregate principal amount of Notes remains
Outstanding.
At any time on or prior to May 15, 2002, the Notes may also be
redeemed as a whole but not in part at the option of the Company upon the
occurrence of a Change of Control, (but in no event more than 90 days after the
occurrence of such Change of Control) at a redemption price equal to 100% of the
principal amount thereof plus the Applicable Premium as of, and accrued but
unpaid interest, if any, to the Redemption Date (subject to the right of
44
Holders on the relevant record date to receive interest due on the relevant
interest payment date).
"Applicable Premium" means, with respect to a Note at any Redemption
Date, the greater of (i) 5.125% of the principal amount of such Note (which
represents the redemption premium otherwise payable on May 15, 2002) and (ii)
the excess of (A) the sum of the present values at such time of (1) the
redemption price of such Note at May 15, 2002 as set forth in the table above
plus (2) all scheduled interest payments (excluding accrued interest for which
the scheduled payment date has not yet occurred) due on such Note through May
15, 2002, computed in each case using a discount rate equal to the Treasury Rate
plus 50 basis points, over (B) the principal amount of such Note.
"Treasury Rate" means the yield to maturity at the time of computation
of United States Treasury securities with a constant maturity (as compiled and
published in the most recent Federal Reserve Statistical Release H. 15(519)
which has become publicly available at least two Business Days prior to the
Redemption Date (or, if such Statistical Release is no longer published, any
publicly available source or similar market data)) most nearly equal to the
period from the Redemption Date to May 15, 2002, provided, however, that if the
-------- -------
period from the Redemption Date to May 15, 2002, is not equal to the constant
maturity of a United States Treasury security for which a weekly average yield
is given, the Treasury Rate shall be obtained by linear interpolation
(calculated to the nearest one-twelfth of a year) from the weekly average yields
of United States Treasury securities for which such yields are given, except
that if the period from the Redemption Date to May 15, 2002, is less than one
year, the weekly average yield on actually traded United States Treasury
securities adjusted to a constant maturity of one year shall be used.
If less than all of the Notes are to be redeemed at any time,
selection of Notes for redemption will be made by the Trustee not more than 60
days prior to the Redemption Date by such method as the Trustee shall deem fair
and appropriate and in a manner that complies with applicable legal and
securities exchange requirements, if any; provided, however, that Notes will be
-------- -------
redeemed in amounts equal to $1,000 or any integral multiple thereof. Notice of
redemption shall be mailed by first-class mail not less than 30 nor more than 60
days prior to the Redemption Date to each Holder of each Note to be redeemed at
such Holder's registered address. If any Note is to be redeemed in part only,
the notice of redemption that relates to such Note shall state the portion of
the principal amount thereof to be redeemed. A new Note in a principal amount
equal to the
45
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancelation of the original Note. On and after the Redemption Date, interest
will cease to accrue on Notes or portions thereof called for redemption.
The Notes do not have the benefit of any sinking fund obligations.
The Indenture provides that, subject to certain conditions, if (A)
certain Net Available Proceeds are available to the Company as a result of Asset
Dispositions or (B) a Change of Control occurs, the Company shall be required to
make an Offer to Purchase all or a specified portion of the Notes.
In the event of redemption or purchase pursuant to an Offer to
Purchase of this Note in part only, a new Note or Notes of like tenor for the
unredeemed or unpurchased portion hereof will be issued in the name of the
Holder hereof upon the cancelation hereof.
If an Event of Default shall occur and be continuing, the principal of
all the Notes may be declared due and payable in the manner and with the effect
provided in the Indenture.
The Indenture contains provisions for defeasance at any time of (1)
the entire indebtedness of this Note or (2) certain restrictive covenants and
Events of Default with respect to this Note, in each case upon compliance with
certain conditions set forth therein.
The Notes shall be subordinated in right of payment to Senior
Indebtedness of the Company as provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes under the Indenture at any
time by the Company and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Notes at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Notes at the time Outstanding,
on behalf of the Holders of all the Notes, to waive compliance by the Company
with certain provisions of the Indenture and certain existing or past defaults
under the Indenture and their consequences. The Indenture also provides that,
without notice to or the consent of any Holder, the Company and the Trustee may
enter into one or more supplemental indentures to, among other things, cure
46
any ambiguity, defect or inconsistency, or make any other change, in each case,
that does not adversely affect the rights of any Holder in any material respect.
Any such consent or waiver by the Holder of this Note or any such supplemental
indenture shall be conclusive and binding upon such Holder and upon all future
Holders of this Note and of any Notes issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Note.
As provided in and subject to the provisions of the Indenture, the
Holder of this Note shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in aggregate principal amount of the Notes at the time Outstanding
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee, offered the Trustee reasonable
indemnity, the Trustee shall not have received from the Holders of a majority in
aggregate principal amount of Notes at the time Outstanding a direction
inconsistent with such request, and the Trustee shall have failed to institute
any such proceeding for 60 days after receipt of such notice, request and offer
of indemnity. The foregoing shall not apply to certain suits described in the
Indenture, including any suit instituted by the Holder of this Note for the
enforcement of any payment of principal hereof or any premium, if any, or
interest hereon on or after the respective due dates expressed herein (or, in
the case of redemption, on or after the Redemption Date or, in the case of any
purchase of this Note required to be made pursuant to an Offer to Purchase, on
the Purchase Date).
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Note at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note is registrable in the Note
Register, upon surrender of this Note for registration of transfer at the office
or agency of the Company in the Borough of Manhattan, The City of New York, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Note Registrar duly executed by the Holder
hereof or his attorney duly authorized in writing, and thereupon one
47
or more new Notes, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Notes are
exchangeable for a like aggregate principal amount of Notes of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer,
the Company, the Trustee, the Note Registrar, any Paying Agent and any of their
agents may treat the Person in whose name this Note is registered as the owner
hereof for all purposes, whether or not this Note be overdue, and neither the
Company, the Trustee, the Note Registrar, any Paying Agent nor any such agent
shall be affected by notice to the contrary.
A director, officer, employee, stockholder or incorporator, as such,
of the Company or any of its Subsidiaries shall not have any liability for any
obligations of the Company or any of its Subsidiaries under this Note or the
Indenture for any claim based on, in respect of or by reason of such obligations
or their creation. Each Holder by accepting this Note waives and releases all
such liability.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
The Indenture and this Note shall be governed by and construed in
accordance with the laws of the State of New York (without giving effect to
conflicts of law principles thereof).
48
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased in its entirety by
the Company pursuant to Section 10.14 or 10.15 of the Indenture, check the box:
[ ]
If you want to elect to have only a part of this Note purchased by the
Company pursuant to Section 10.14 or 10.15 of the Indenture, state the amount
(which must be $1,000 or an integral multiple thereof): $______________
Dated:_____________ Your Signature:____________________________
(Sign exactly as name appears on the
other side of this Note)
Signature Guarantee:____________________________________________________________
Notice: Signature(s) must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the
Trustee, which requirements will include membership or
participation in STAMP or such other "signature guarantee
program" as may be determined by the Trustee in addition to,
or in substitution for STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SECTION 2.04. Form of Trustee's Certificate of Authentication. This
------------------------------------------------
is one of the Notes referred to in the within-mentioned Indenture.
United States Trust Company of
New York, as Trustee
By:____________________________________________
Authorized Signature
49
ARTICLE III
The Notes
---------
SECTION 3.01. Title and Terms. (a) The aggregate principal amount
----------------
of Notes which may be authenticated and delivered under this Indenture is
limited to $250,000,000, except for Notes authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of other Notes
pursuant to Sections 3.03, 3.04, 3.05, 3.06, 3.07, 9.06, 11.08 or in connection
with an Offer to Purchase pursuant to Section 10.14 or 10.15 (all Notes referred
to in this exception being deemed "Substitute Notes"). The Company may issue
Exchange Notes from time to time pursuant to an Exchange Offer, in each case
pursuant to a Board Resolution and subject to Section 3.03, in authorized
denominations in exchange for a like principal amount of Original Notes. Upon
any such exchange the Original Notes shall be canceled in accordance with
Section 3.10 and shall no longer be deemed Outstanding for any purpose. Subject
to the terms and conditions hereof, (i) $175,000,000 in aggregate principal
amount of Notes will be authenticated and delivered on the date hereof and (ii)
in accordance with clause (b) below, up to $75,000,000 of Additional Notes may
be authenticated and delivered in the future (which may be Restricted Notes or
Regulation S Notes (which may be subject to an Exchange and Regulation Rights
Agreement) or may be Registered Notes as specified in the relevant Board
Resolution); provided, however, that in no event shall the aggregate principal
-------- -------
amount of all Notes Outstanding (including all Restricted Notes, Regulation S
Notes and Registered Notes at the time Outstanding) exceed $250,000,000.
The Notes shall be known and designated as the "10-1/4% Senior
Subordinated Notes due 2007" of the Company. Their Stated Maturity shall be May
15, 2007 and they shall bear interest at the rate of 10-1/4% per annum (the
"Base Interest"), from May 21, 1997 or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, as the case may be,
payable semi-annually on May 15 and November 15, commencing November 15, 1997,
until the principal thereof is paid or made available for payment; provided,
--------
however, with respect to Original Notes, that if a Registration Default occurs,
-------
as liquidated damages for such Registration Default, Special Interest, in
addition to the Base Interest, shall accrue during the Registration Default
Period for such Registration Default at a per annum rate of 0.25% for the first
90 days of such Registration Default Period, at a per annum rate of 0.50% for
the second 90 days of such Registration Default Period, at a per annum rate of
0.75% for the third 90 days of such Registration
50
Default Period and at a per annum rate of 1.0% thereafter for the remaining
portion of such Registration Default Period. The Company shall provide written
notice to the Trustee of any Registration Default and of the end of the
Registration Default Period for such Registration Default. Accrued Special
Interest, if any, shall be paid in cash in arrears semi-annually on May 15 and
November 15 in each year, and the amount of accrued Special Interest shall be
determined on the basis of the number of days actually elapsed.
Any accrued and unpaid interest (including Special Interest, if any)
on this Note upon the issuance of an Exchange Note in exchange for this Note
shall cease to be payable to the Holder hereof but such accrued and unpaid
interest (including Special Interest, if any) shall be payable on the next
Interest Payment Date for such Exchange Note to the Holder thereof on the
related Regular Record Date.
The principal of (and premium, if any) and interest on the Notes
shall be payable at the office or agency of the Company in the Borough of
Manhattan, The City of New York, New York, maintained for such purpose and at
any other office or agency maintained by the Company for such purpose; provided,
--------
however, that at the option of the Company payment of interest may be made by
-------
check mailed to the address of the Person entitled thereto as such address shall
appear in the Note Register; provided further that all payments of the principal
----------------
(and premium, if any) and interest on Notes, the Holders of which have given
wire transfer instructions to the Company or its agent at least 10 Business Days
prior to the applicable payment date, will be required to be made by wire
transfer of immediately available funds to the accounts specified by such
Holders in such instructions.
The Notes shall be subject to redemption as provided in Article XI.
The Notes shall be subject to repurchase by the Company pursuant to an
Offer to Purchase as provided in Sections 10.14 and 10.15.
The Notes shall not have the benefit of any sinking fund obligations.
The Notes shall be subject to defeasance at the option of the Company
as provided in Article XII.
The Notes shall be subordinated in right of payment to Senior
Indebtedness of the Company and, if any,
51
each of the Subsidiary Guarantors, respectively, as provided in Article XIV and,
if any, each indenture supplemental hereto in the form of Annex D, respectively.
Unless the context otherwise requires, the Original Notes, the
Exchange Notes and any Registered Notes shall constitute one series for all
purposes under the Indenture, including with respect to any amendment, waiver,
acceleration or other Act of Holders, redemption or Offer to Purchase.
(b) With respect to any Notes issued after the Issue Date (except for
Exchange Notes or Substitute Notes) there shall be established in or pursuant to
a Board Resolution, and subject to Section 3.03, set forth, or determined in a
manner provided in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of such Notes:
(i) the aggregate principal amount of such Notes which may be
authenticated and delivered under this Indenture which shall be in
aggregate principal amounts of not less than $10 million per issuance and
which together with all other issuances under this clause (b) shall not
exceed $75 million;
(ii) the date from which interest on such Notes shall accrue;
(iii) whether such Notes shall be initially issued as Original Notes
(in the form of Restricted Notes and/or Regulation S Notes) that are
subject to an Exchange and Registration Rights Agreement, or instead shall
be issued in the form of Registered Notes pursuant to a registration
statement under the Securities Act; and
(iv) the price at which such Additional Notes have initially been sold
to the public (exclusive of any underwriter); provided, however, that no
-------- -------
Additional Note may be issued at a price that would cause such Note to have
"original issue discount" within the meaning of Section 1273 of the
Internal Revenue Code of 1986, as amended.
A copy of an appropriate record of such action shall be certified by
the Secretary or any Assistant Secretary of the Company and delivered to the
Trustee at or prior to the delivery of the Officers' Certificate or the trust
indenture supplemental hereto setting forth the terms of such Notes.
52
SECTION 3.02. Denominations. The Notes shall be issuable only in
--------------
registered form without coupons, and only in denominations of $1,000 and any
integral multiple thereof.
SECTION 3.03. Execution, Authentication, Delivery and Dating. The
-----------------------------------------------
Notes shall be executed on behalf of the Company by its Chairman of the Board,
its Vice Chairman of the Board, Chief Executive Officer, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Notes executed by the Company, together
with a Company Order for the authentication and delivery of such Notes; and the
Trustee in accordance with such Company Order shall authenticate and deliver
such Notes as in this Indenture provided and not otherwise. In addition, in the
case of the original issuance of any Additional Notes, the Company shall deliver
the Officers' Certificate referred to in Section 3.01(b).
At any time and from time to time after the execution and delivery of
this Indenture and after the effectiveness of a registration statement under the
Securities Act with respect thereto, the Company may deliver Exchange Notes
executed by the Company, to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Exchange Notes and a
like principal amount of Original Notes for cancelation in accordance with
Section 3.10 of this Indenture, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Notes. Prior to authenticating such
Exchange Notes, and accepting any additional responsibilities under this
Indenture in relation to such Notes, the Trustee shall be entitled to receive,
if
53
requested, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating in substance:
(a) that all conditions hereunder precedent to the authentication and
delivery of such Exchange Notes have been complied with and that such
Exchange Notes endorsed thereon, when such Notes have been duly
authenticated and delivered by the Trustee (and subject to any other
conditions specified in such Opinion of Counsel), have been duly issued and
delivered and will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors, rights
and to general equity principles; and
(b) that the issuance of the Exchange Notes in exchange for Original
Notes has been effected in compliance with the Securities Act.
Each Note shall be dated the date of its authentication.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder.
SECTION 3.04. Temporary Notes. Pending the preparation of definitive
----------------
Notes, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Notes, which Notes are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as evidenced by their execution thereof.
If temporary Notes are issued, the Company will cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes, upon
surrender of the temporary Notes at any office or agency of the Company
designated pursuant to Section 10.02,
54
without charge to the Holder. Upon surrender for cancelation of any one or more
temporary Notes, the Company shall execute and the Trustee shall authenticate
and deliver in exchange therefor a like principal amount of definitive Notes of
authorized denominations. Until so exchanged the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as definitive
Notes.
SECTION 3.05. Global Notes. (a) Each Global Note authenticated
-------------
under this Indenture shall be registered in the name of the Depositary
designated by the Company for such Global Note or a nominee thereof and
delivered to such Depositary or a nominee thereof or custodian therefor, and
each such Global Note shall constitute a single Note for all purposes of this
Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Note may be exchanged in whole or in part for Notes registered, and no transfer
of a Global Note in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Note or a nominee thereof
unless (i) such Depositary (A) has notified the Company that it is unwilling or
unable to continue as Depositary for such Global Note or (B) has ceased to be a
clearing agency registered as such under the Exchange Act, and in either case
the Company fails to appoint a successor Depositary, (ii) the Company executes
and delivers to the Trustee a Company Order stating that it elects to cause the
issuance of the Note in certificated form and that all Global Notes shall be
exchanged in whole for Notes that are not Global Notes (in which case such
exchange shall be effected by the Trustee) or (iii) there shall have occurred
and be continuing an Event of Default with respect to such Global Notes.
(c) If any Global Note is to be exchanged for other Notes or canceled
in whole, it shall be surrendered by or on behalf of the Depositary or its
nominee to the Trustee, as Note Registrar, for exchange or cancelation as
provided in this Article III. If any Global Note is to be exchanged for other
Notes or canceled in part, or if another Note is to be exchanged in whole or in
part for a beneficial interest in any Global Note, then either (i) such Global
Note shall be so surrendered for exchange or cancelation as provided in this
Article III or (ii) the principal amount thereof shall be reduced or increased
by an amount equal to the portion thereof to be so exchanged or canceled, or
equal to the principal amount of such other Notes to be so exchanged for a
beneficial interest therein, as the case may be, by means of an appropriate
adjustment made on the records of the Trustee, as Note Registrar, whereupon the
Trustee, in accordance with the Applicable Procedures, shall
55
instruct the Depositary or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global
Note, the Trustee shall, subject to Section 3.06(c) and as otherwise provided in
this Article III, authenticate and deliver any Notes issuable in exchange for
such Global Notes (or any portion thereof) to or upon the order of, and
registered in such names as may be directed by, the Depositary or its authorized
representative. Upon the request of the Trustee in connection with the
occurrence of any of the events specified in the preceding paragraph, the
Company shall promptly make available to the Trustee a reasonable supply of
Notes that are not in the form of Global Notes. The Trustee shall be entitled
to rely upon any order, direction or request of the Depositary or its authorized
representative which is given or made pursuant to this Article III if such
order, direction or request is given or made in accordance with the Applicable
Procedures.
(d) Every Note authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Note or any portion
thereof, whether pursuant to this Article III or otherwise, shall be
authenticated and delivered in the form of, and shall be, a Global Note, unless
such Note is registered in the name of a Person other than the Depositary for
such Global Note or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a Global
Note, shall be the Holder of such Global Note for all purposes under the
Indenture and the Notes, and owners of beneficial interests in a Global Note
shall hold such interests pursuant to the Applicable Procedures. Accordingly,
any such owner's beneficial interest in a Global Note will be shown only on, and
the transfer of such interest shall be effected only through, records maintained
by the Depositary or its nominee or its Agent Members.
SECTION 3.06. Registration, Registration of Transfer and Exchange
---------------------------------------------------
Generally; Restrictions on Transfer and Exchange; Securities Act Legends. (a)
-------------------------------------------------------------------------
Registration, Registration of Transfer and Exchange Generally. The Company
--------------------------------------------------------------
shall cause to be kept at the Corporate Trust Office of the Trustee a register
(the register maintained in such office and in any other office or agency of the
Company designated pursuant to Section 10.02 being herein sometimes collectively
referred to as the "Note Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Notes and of transfers and exchanges of Notes. The Trustee is hereby
appointed "Note Registrar" for the purpose of registering Notes and transfers
and exchanges of Notes as herein
56
provided. Such Note Register shall distinguish between Original Notes and
Exchange Notes.
Upon surrender for registration of transfer of any Note at an office
or agency of the Company designated pursuant to Section 10.02 for such purpose,
the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Notes of
any authorized denominations, of a like aggregate principal amount and bearing
such restrictive legends as may be required by this Indenture on each such new
Note.
At the option of the Holder, and subject to the other provisions of
this Section 3.06, Notes may be exchanged for other Notes of any authorized
denominations, of a like aggregate principal amount, each such new Note executed
by the Company, upon surrender of the Note to be exchanged at any such office or
agency. Whenever any Notes are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Notes which the
Holder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange shall
be the valid Obligations of the Company, and (except for the differences between
Original Notes and Exchange Notes provided for herein) entitled to the same
benefits under this Indenture, as the Notes, surrendered upon such registration
of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Note Registrar) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Note Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Notes, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes, other than exchanges
pursuant to Section 3.03, 3.04, 3.05, 3.06, 9.06, 10.14, 10.15 or 11.08 not
involving any transfer.
The Company shall not be required (i) to issue, register the transfer
of or exchange any Notes during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of Notes selected
for redemption under Section 11.05 and ending at
57
the close of business on the day of such mailing, (ii) to register the transfer
of or exchange any Notes so selected for redemption in whole or in part, except
the unredeemed portion of any Notes being redeemed in part or (iii) to register
the transfer of or to exchange any Notes between a record date and the next
succeeding Interest Payment Date.
(b) Certain Transfers and Exchanges. Notwithstanding any other
--------------------------------
provision of this Indenture or the Notes, transfers and exchanges of Notes and
beneficial interests in a Global Note of the kinds specified in this Section
3.06(b) shall be made only in accordance with this Section 3.06(b).
(i) Restricted Global Note to Regulation S Global Note. If the owner
---------------------------------------------------
of a beneficial interest in the Restricted Global Note wishes at any time
to transfer such interest to a Person who wishes to acquire the same in the
form of a beneficial interest in the Regulation S Global Note, such
transfer may be effected only in accordance with the provisions of this
Clause (b)(i) and Clause (b)(vii) below and subject to the Applicable
Procedures. Upon receipt by the Trustee, as Note Registrar, of (A) an
order given by the Depositary or its authorized representative directing
that a beneficial interest in the Regulation S Global Note in a specified
principal amount be credited to a specified Agent Member's account and that
a beneficial interest in the Restricted Global Note in an equal principal
amount be debited from another specified Agent Member's account and (B) a
Regulation S Certificate, satisfactory to the Trustee and duly executed by
the owner of such beneficial interest in the Restricted Global Note or his
attorney duly authorized in writing, then the Trustee, as Note Registrar
but subject to Clause (b)(vii) below, shall reduce the principal amount of
the Restricted Global Note and increase the principal amount of the
Regulation S Global Note by such specified principal amount as provided in
Section 3.05(c).
(ii) Regulation S Global Notes to Restricted Global Note. If the
----------------------------------------------------
owner of a beneficial interest in the Regulation S Global Note wishes at
any time to transfer such interest to a Person who wishes to acquire the
same in the form of a beneficial interest in the Restricted Global Note,
such transfer may be effected only in accordance with this Clause (b)(ii)
and subject to the Applicable Procedures. Upon receipt by the Trustee, as
Note Registrar, of (A) an order given by the Depositary or its authorized
representative directing that a beneficial interest in the
58
Restricted Global Note in a specified principal amount be credited to a
specified Agent Member's account and that a beneficial interest in the
Regulation S Global Note in an equal principal amount be debited from
another specified Agent Member's account and (B) if such transfer is to
occur during the Restricted Period, a Restricted Notes Certificate,
satisfactory to the Trustee and duly executed by the owner of such
beneficial interest in the Regulation S Global Note or his attorney duly
authorized in writing, then the Trustee, as Note Registrar, shall reduce
the principal amount of the Regulation S Global Note and increase the
principal amount of the Restricted Global Note by such specified principal
amount as provided in Section 3.05(c).
(iii) Restricted Non-Global Note to Restricted Global Note or
-------------------------------------------------------
Regulation S Global Note. If the Holder of a Restricted Note (other than a
-------------------------
Global Note) wishes at any time to transfer all or any portion of such
Notes to a Person who wishes to take delivery thereof in the form of a
beneficial interest in the Restricted Global Note or the Regulation S
Global Note, such transfer may be effected only in accordance with the
provisions of this Clause (b)(iii) and Clause (b)(vii) below and subject to
the Applicable Procedures. Upon receipt by the Trustee, as Note Registrar,
of (A) such Restricted Note as provided in Section 3.06(a) and instructions
satisfactory to the Trustee directing that a beneficial interest in the
Restricted Global Note or Regulation S Global Note in a specified principal
amount not greater than the principal amount of such Note be credited to a
specified Agent Member's account and (B) a Restricted Note Certificate, if
the specified account is to be credited with a beneficial interest in the
Restricted Global Note, or a Regulation S Certificate, if the specified
account is to be credited with a beneficial interest in the Regulation S
Global Note, in either case satisfactory to the Trustee and duly executed
by such Holder or his attorney duly authorized in writing, then the
Trustee, as Note Registrar but subject to Clause (b)(vii) below, shall
cancel such Restricted Note (and issue a new Restricted Note in respect of
any untransferred portion thereof) as provided in Section 3.06(a) and
increase the principal amount of the Restricted Global Note or the
Regulation S Global Note, as the case may be, by the specified principal
amount as provided in Section 3.05(c).
(iv) Regulation S Non-Global Note to Restricted Global Note or
---------------------------------------------------------
Regulation S Global Note. If the Holder
-------------------------
59
of a Regulation S Note (other than a Global Note) wishes at any time to
transfer all or any portion of such Restricted Note to a Person who wishes
to take delivery thereof in the form of a beneficial interest in the
Restricted Global Note or the Regulation S Global Note, such transfer may
be effected only in accordance with this Clause (b)(iv) and Clause (b)(vii)
below and subject to the Applicable Procedures. Upon receipt by the
Trustee, as Note Registrar, of (A) such Restricted Note as provided in
Section 3.06(a) and instructions satisfactory to the Trustee directing that
a beneficial interest in the Restricted Global Note or Regulation S Global
Note in a specified principal amount not greater than the principal amount
of such Note be credited to a specified Agent Member's account and (B) if
the transfer is to occur during the Restricted Period and the specified
account is to be credited with a beneficial interest in the Restricted
Global Note, a Restricted Notes Certificate satisfactory to the Trustee
and duly executed by such Holder or his attorney duly authorized in
writing, then the Trustee, as Note Registrar but subject to Clause (b)(vii)
below, shall cancel such Restricted Note (and issue a new Restricted Note
in respect of any untransferred portion thereof) as provided in Section
306(a) and increase the principal amount of the Restricted Global Note or
the Regulation S Global Note, as the case may be, by the specified
principal amount as provided in Section 3.05(c).
(v) Non-Global Note to Non-Global Note. A Note that is not a Global
-----------------------------------
Note may be transferred, in whole or in part, to a Person who takes
delivery in the form of another Note that is not a Global Note as provided
in Section 3.06(a); provided that if the Note to be transferred in whole or
--------
in part is a Restricted Note, or is a Regulation S Note and the transfer is
to occur during the Restricted Period, then the Trustee shall have received
(A) a Restricted Notes Certificate, satisfactory to the Trustee and duly
executed by the transferor Holder or his attorney duly authorized in
writing, in which case the transferee Holder shall take delivery in the
form of a Restricted Note, or (B) a Regulation S Certificate, satisfactory
to the Trustee and duly executed by the transferor Holder or his attorney
duly authorized in writing, in which case the transferee Holder shall take
delivery in the form of a Regulation S Note (subject in every case to
Section 3.06(c)).
(vi) Exchanges between Global Note and Non-Global Note. A beneficial
--------------------------------------------------
interest in a Global Note may be
60
exchanged for a Note that is not a Global Note as provided in Section 3.05;
provided that, if such interest is a beneficial interest in the Restricted
--------
Global Note, or if such interest is a beneficial interest in the Regulation
S Global Note and such exchange is to occur during the Restricted Period,
then such interest shall be exchanged for a Restricted Note (subject in
each case to Section 3.06(c)). A Note that is not a Global Note may be
exchanged for a beneficial interest in a Global Note only if (A) such
exchange occurs in connection with a transfer effected in accordance with
Clause (b)(iii) or (iv) above or (B) such Note is a Regulation S Note and
such exchange occurs after the Restricted Period.
(vii) Regulation S Global Note to Be Held Through Euroclear or Cedel
--------------------------------------------------------------
During Restricted Period. The Company shall use its best efforts to cause
-------------------------
the Depositary to ensure that, until the expiration of the Restricted
Period, beneficial interests in the Regulation S Global Note may be held
only in or through accounts maintained at the Depositary by Euroclear or
Cedel (or by Agent Members acting for the account thereof), and no person
shall be entitled to effect any transfer or exchange that would result in
any such interest being held otherwise than in or through such an account;
provided that this Clause (b)(vii) shall not prohibit any transfer or
--------
exchange of such an interest in accordance with Clause (b)(ii) or (vi)
above.
(c) Securities Act Legends. Rule 144A Notes and their respective
-----------------------
Successor Notes shall bear a Restricted Notes Legend, and Regulation S Notes and
their Successor Notes shall bear a Regulation S Legend, subject to the
following:
(i) subject to the following Clauses of this Section 3.06(c), a Note
or any portion thereof which is exchanged, upon transfer or otherwise, for
a Global Note or any portion thereof shall bear the Securities Act Legend
borne by such Global Note while represented thereby;
(ii) subject to the following Clauses of this Section 3.06(c), a new
Note which is not a Global Note and is issued in exchange for another Note
(including a Global Note) or any portion thereof, upon transfer or
otherwise, shall bear the Securities Act Legend borne by such other Note;
provided that if such new Note is required pursuant to Section 3.06(b)(v)
--------
or (vi) to be issued in the form of a Restricted Note, it shall bear
61
a Restricted Note Legend and, if such new Note is so required to be issued
in the form of a Regulation S Note, it shall bear a Regulation S Legend;
(iii) Registered Notes shall not bear a Securities Act Legend;
(iv) at any time after the Note may be freely transferred without
registration under the Securities Act or without being subject to transfer
restrictions pursuant to the Securities Act, a new Note which does not bear
a Securities Act Legend may be issued in exchange for or in lieu of a Note
(other than a Global Note) or any portion thereof which bears such a legend
if the Trustee has received an Unrestricted Note Certificate, satisfactory
to the Trustee and duly executed by the Holder of such legended Note or his
attorney duly authorized in writing, and after such date and receipt of
such certificate, the Trustee shall authenticate and deliver such a new
Note in exchange for or in lieu of such other Note as provided in this
Article III;
(v) a new Note which does not bear a Securities Act Legend may be
issued in exchange for or in lieu of a Note (other than a Global Note) or
any portion thereof which bears such a legend if, in the Company's
judgment, placing such a legend upon such new Note is not necessary to
ensure compliance with the registration requirements of the Securities Act,
and the Trustee, at the direction of the Company and, if requested by the
Trustee, upon delivery of an Opinion of Counsel, shall authenticate and
deliver such a new Note as provided in this Article III; and
(vi) notwithstanding the foregoing provisions of this Section 3.06(c),
a Successor Note of a Note that does not bear a particular form of
Securities Act Legend shall not bear such form of legend unless the Company
has reasonable cause to believe that such Successor Note is a "Restricted
Note" within the meaning of Rule 144, in which case the Trustee, at the
direction of the Company, shall authenticate and deliver a new Note bearing
a Restricted Note Legend in exchange for such Successor Note as provided in
this Article III.
SECTION 3.07. Mutilated, Destroyed, Lost and Stolen Notes. If any
--------------------------------------------
mutilated Note is surrendered to the Trustee, the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a new Note of
62
like tenor and principal amount, bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any Note and
(b) such security or indemnity as may be required by either of them to save each
of them and any agent of either of them harmless, then, in the absence of notice
to the Company or the Trustee that such Note has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Note, a
new Note of like tenor and principal amount, bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies of any Holder with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 3.08. Payment of Interest; Interest Rights Preserved.
-----------------------------------------------
Interest on any Note which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Person in whose name that
Note (or one or more Predecessor Notes) is registered at the close of business
on the Regular Record Date for such interest.
Any interest on any Note which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall
63
forthwith cease to be payable to the Holder on the relevant Regular Record Date
by virtue of having been such Holder, and such Defaulted Interest may be paid by
the Company, at its election in each case, as provided in Clause (a) or (b)
below:
(a) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Note and the date
of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit on or prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Company, with the consent of the Trustee,
shall fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the receipt by
the Trustee of the notice of the proposed payment. The Company shall
promptly notify the Trustee of such Special Record Date and the Company or
the Trustee, in the name and at the expense of the Company, shall cause
notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to each
Holder of Notes at such Holder's address as it appears in the Note
Register, not less than 10 days prior to such Special Record Date. Notice
of the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be paid
to the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered at the close of business on such Special Record Date
and shall no longer be payable pursuant to the following Clause (b).
(b) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such notice
as may be required by such exchange, if, after notice given by the Company
to the Trustee of the proposed
64
payment pursuant to this Clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Note shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Note.
Notwithstanding the foregoing, any interest which is paid prior to the
expiration of the grace period provided for in Section 5.01(a) hereof shall be
paid to the Holders of the Notes as of the Regular Record Date for the Interest
Payment Date for which interest has not been paid.
SECTION 3.09. Persons Deemed Owners. Prior to due presentment of a
----------------------
Note for registration of transfer, the Company, the Trustee, the Note Registrar,
any Paying Agent and any of their agents may treat the Person in whose name
such Note is registered as the owner of such Note for the purpose of receiving
payment of principal of (and premium, if any) and (subject to Section 3.08)
interest on such Note and for all other purposes whatsoever, whether or not such
Note be overdue, and neither the Company, the Trustee, the Note Registrar, any
Paying Agent nor any such agent shall be affected by notice to the contrary.
SECTION 3.10. Cancelation. All Notes surrendered for payment,
------------
redemption, repurchase pursuant to any Offer to Purchase, registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceled by it. The Company
may at any time deliver to the Trustee for cancelation any Note previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly canceled by the
Trustee. No Note shall be authenticated in lieu of or in exchange for any Note
canceled as provided in this Section, except as expressly permitted by this
Indenture. Subject to the record retention requirements of the Exchange Act,
all canceled Notes held by the Trustee, together with any Subsidiary Guaranties
that may be endorsed thereon, shall be disposed of by the Trustee as directed by
Company Order and the Trustee will certify as to such disposal to the reasonable
satisfaction of the Company. The Trustee shall provide the Company with a list
of all Notes that have been canceled from time to time as requested by the
Company.
65
SECTION 3.11. Computation of Interest. Interest on the Notes shall
------------------------
be computed on the basis of a 360-day year of twelve 30-day months; provided,
--------
however, that any Special Interest on Original Notes and any interest on overdue
-------
principal of (and premium, if any) and interest on any Note, shall be computed
on the basis of a 365-day or 366-day year, as the case may be, and the number of
days actually elapsed during the relevant Registration Default Period or the
period of default in the payment of such overdue principal (and premium, if any)
or interest.
SECTION 3.12. CUSIP Number. The Company shall in issuing the Notes
-------------
use a CUSIP number, and the Trustee shall use the CUSIP number in notices of
redemption or exchange as a convenience to the Holders; provided, that any such
--------
notice may state that no representation is made as to the accuracy or
correctness of the CUSIP number printed in the notice or on the certificates
representing the Notes and that reliance may be placed only on the other
identification numbers printed on the certificates representing the Notes.
ARTICLE IV
Satisfaction and Discharge
--------------------------
SECTION 4.01. Satisfaction and Discharge of Indenture. This
----------------------------------------
Indenture shall cease to be of further effect (except as to any surviving rights
of registration of transfer or exchange of Notes herein expressly provided for),
and the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when:
(a) either
(i) all Notes theretofore authenticated and delivered (other than
(A) Notes which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 3.07 and (B) Notes for
whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust, as provided in Section
10.03) have been delivered to the Trustee for cancelation; or
(ii) all such Notes not theretofore delivered to the Trustee for
cancelation
(A) have become due and payable, or
66
(B) will become due and payable at their Stated Maturity
within one year, or
(C) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the
expense, of the Company,
and the Company, in the case of (A), (B) or (C) above, has deposited
or caused to be deposited with the Trustee as trust funds in trust for
the purpose cash in U.S. dollars, U.S. Government Obligations, which
through the scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not later than
one day before the due date of any payment, or any combination
thereof, an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the Trustee
for cancelation, for principal (and premium, if any) and interest to
the date of such deposit (in the case of Notes which have become due
and payable) or to the Stated Maturity or Redemption Date, as the case
may be;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations of
the Trustee to any Authenticating Agent under Section 6.14 and, if money shall
have been deposited with the Trustee pursuant to Clause a(ii) of this Section,
the obligations of the Trustee under Section 4.02 and the last paragraph of
Section 10.03 shall survive.
SECTION 4.02. Application of Trust Money. Subject to the provisions
---------------------------
of the last paragraph of Section 10.03, all money deposited with the Trustee
pursuant to Section 4.01 shall be held in trust and applied by it, in accordance
with the provisions of the Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying
67
Agent) as the Trustee may determine, to the Persons entitled thereto, of the
principal (and premium, if any) and interest for whose payment such money has
been deposited with the Trustee.
ARTICLE V
Remedies
--------
SECTION 5.01. Events of Default. "Event of Default", wherever used
------------------
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any interest on any Note when it
becomes due and payable and continuance of such default for a period of 30
days;
(b) default in the payment of the principal of or premium, if any, on
any Note at its Maturity (upon acceleration, optional redemption, required
purchase or otherwise) or the cessation to be in full force and effect
(other than as a result of a termination pursuant to its terms) of a
Subsidiary Guaranty issued by a Subsidiary that is at the time a Material
Subsidiary;
(c) default in the performance of obligations of Sections 8.01, 10.14
or 10.15;
(d) default in the performance, or breach, of any covenant or
warranty of the Company contained in this Indenture (other than a default
in the performance, or breach, of a covenant or warranty which is
specifically dealt with in clause (a), (b) or (c) above) and continuance of
such default or breach for a period of 60 days after written notice
(identifying the default or breach and stating that the notice constitutes
a notice of an Event of Default) shall have been given to the Company by
the Trustee or to the Company and the Trustee by the holders of at least
25% in aggregate principal amount of the Notes then outstanding;
(e) one or more defaults in the (A) payment of principal of or
premium, if any, on Indebtedness of the Company or a Subsidiary Guarantor
aggregating $5 million or more, when the same becomes due and payable at
the final maturity thereof, and such default
68
or defaults shall have continued after any applicable grace period and
shall not have been cured or waived or (B) Indebtedness of the Company or a
Subsidiary Guarantor aggregating $5 million or more shall have been
accelerated or otherwise declared due and payable, or required to be
prepaid or repurchased (other than by regularly scheduled prepayment) prior
to the stated maturity thereof;
(f) one or more final judgments or orders shall be rendered against
the Company or a Subsidiary Guarantor for the payment of money, either
individually or in an aggregate amount, in excess of $5 million and shall
not be discharged and either (A) an enforcement proceeding shall have been
commenced by any creditor upon such judgment or order and such proceeding
shall not have been stayed within 5 days or (B) there shall have been a
period of 60 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, was not in
effect;
(g) the entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of the Company or any Subsidiary
Guarantor that is at the time a Material Subsidiary in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (ii) a decree or order adjudging the
Company or any Subsidiary Guarantor that is at the time a Material
Subsidiary a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of
or in respect of the Company or any such Subsidiary Guarantor under any
applicable Federal or State law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of
the Company or any such Subsidiary Guarantor or of any substantial part of
the property of the Company or any such Subsidiary Guarantor or ordering
the winding up or liquidation of the affairs of the Company or any such
Subsidiary Guarantor and the continuance of any such decree or order for
relief or any such other decree or order unstayed and in effect for a
period of 60 consecutive days; or
(h) the commencement by the Company or any Subsidiary Guarantor of a
voluntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or of any other
case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by the Company or any Subsidiary Guarantor to the entry of a decree
or
69
order for relief in respect of the Company or any Subsidiary Guarantor in
an involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against the
Company or any Subsidiary Guarantor or the filing by the Company or any
Subsidiary Guarantor of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State law, or the
consent by the Company or any Subsidiary Guarantor to the filing of such a
petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar official
of the Company or any Subsidiary Guarantor or of any substantial part of
the property of the Company or any Subsidiary Guarantor, or the making by
the Company or any Subsidiary Guarantor of an assignment for the benefit of
creditors, or the admission by the Company or any Subsidiary Guarantor in
writing of its inability to pay its debts generally as they become due, or
the taking of corporate action by the Company or any Subsidiary Guarantor
in furtherance of any such action.
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment.
---------------------------------------------------
If an Event of Default (other than an Event of Default specified in Section
5.01(g) or 5.01(h)) occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Notes may declare the principal of all the Notes to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by the Holders), and upon any such declaration such principal and any
accrued interest, if any, shall become immediately due and payable; provided,
--------
however, that, so long as any Indebtedness permitted to be incurred pursuant to
-------
the Bank Facility shall be outstanding, no such acceleration shall be effective
until the earlier of (x) acceleration of any such Indebtedness under the Bank
Facility or (y) five business days after the giving of written notice to the
Company and the administrative agent under the Bank Facility of such
acceleration. Upon the effectiveness of such declaration, such principal and
interest will be due and payable immediately. If an Event of Default specified
in Section 5.01(g) or 5.01(h) occurs and is continuing, the principal of and any
accrued interest, if any, on the Notes then Outstanding shall automatically, and
without any declaration or other action on the part of the Trustee or any
Holder, become immediately due and payable.
At any time after such a declaration of acceleration has been made
and before a judgment or decree for
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payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
Outstanding Notes, by written notice to the Company and the Trustee, may rescind
and annul such declaration and its consequences if:
(a) the Company has paid or deposited, or caused to be paid or
deposited, with the Trustee a sum sufficient to pay:
(i) all sums paid or advanced by the Trustee under the
Indenture and the reasonable compensa tion, expenses, disbursements
and advances of the Trustee, its agents and counsel,
(ii) all overdue interest on all Notes,
(iii) the principal of and premium, if any, on any Notes that has
become due otherwise than by such declaration of acceleration and
interest thereon at the rate borne by the Notes and (iv) to the extent
that payment of such interest is lawful, interest upon overdue
interest at the rate borne by the Notes, and
(b) all Events of Default, other than the non-payment of principal of
the Notes which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
In the event of any Event of Default specified in clause (e) above,
such Event of Default and all consequences thereof (including without limitation
any acceleration or resulting payment default) shall be annulled, waived and
rescinded, automatically and without any action by the Trustee or the Holders of
the Notes, if, within 20 days after such Event of Default arose, (x) the
Indebtedness that is the basis for such Event of Default has been discharged,
(y) the holders thereof have rescinded or waived the acceleration, notice or
action (as the case may be) giving rise to such Event of Default or (z) if the
default that is the basis for such Event of Default has been cured.
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SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee. The Company covenants that if:
--------
(a) default is made in the payment of any interest on any Note when
such interest becomes due and payable and such default continues for a
period of 30 days; or
(b) default is made in the payment of the principal of (or premium, if
any, on) any Note at the Maturity thereof or, with respect to any Note
required to have been purchased pursuant to an Offer to Purchase made by
the Company, at the Purchase Date thereof;
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Notes, the whole amount then due and payable on such Notes for
principal (and premium, if any) and interest, and, to the extent that payment of
such interest shall be legally enforceable, interest on any principal (and
premium, if any) and interest that is overdue, at the rate provided therefor in
the Notes, and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.04. Trustee May File Proofs of Claim. In case of any
---------------------------------
judicial proceeding relative to the Company or any other obligor upon the Notes
or the property of the Company or its creditors, the Trustee shall be entitled
and empowered, by intervention in such proceeding or otherwise, to take any and
all actions, including participation as a member, voting or otherwise, of any
committee of creditors, authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that
72
the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 6.07.
Notwithstanding the foregoing, no provision of this Indenture shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding; provided, however, that the Trustee may, on behalf of such Holders,
-------- -------
vote for the election of a trustee in bankruptcy or similar official and be a
member of a creditors' or other such committee.
SECTION 5.05. Trustee May Enforce Claims Without Possession of Notes.
------------------------------------------------------
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Notes in respect of which such judgment has been recovered.
SECTION 5.06. Application of Money Collected. Subject to Article
-------------------------------
XIV and any Subsidiary Guaranty pursuant to an indenture supplemental hereto in
the form of Annex D, if any, any money collected by the Trustee pursuant to this
Article shall be applied in the following order, at the date or dates fixed by
the Trustee and, in case of the distribution of such money on account of
principal (or premium, if any) or interest, upon presentation of the Notes and
the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.07; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Notes in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Notes
73
for principal (and premium, if any) and interest, respectively.
SECTION 5.07. Limitation on Suits. No Holder of any Notes shall have
--------------------
any right to institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of
a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate principal amount of
the Outstanding Notes shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name
as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent (in the reasonable opinion of the
Trustee) with such written request has been given to the Trustee during
such 60-day period by the Holders of a majority in aggregate principal
amount of the Outstanding Notes;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 5.08. Unconditional Right of Holders To Receive Principal,
----------------------------------------------------
Premium and Interest. Notwithstanding any other provision in this Indenture,
---------------------
but subject to the provisions of Article XIV and any Subsidiary Guaranty
pursuant to an indenture supplemental hereto in the form of Annex D, if any, the
Holder of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 3.08) interest on such Note on the respective Stated Maturities
expressed in such Note (or, in
74
the case of redemption or repurchase, on the Redemption Date or the Purchase
Date, as the case may be) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the Trustee or
-----------------------------------
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. Except as otherwise
-------------------------------
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes in the last paragraph of Section 3.07, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver. No delay or omission of
-----------------------------
the Trustee or of any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 5.12. Control by Holders. The Holders of a majority in
-------------------
aggregate principal amount of the Outstanding Notes shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee; provided that:
--------
(a) such direction shall not be in conflict with any rule of law or
with this Indenture and
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(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 5.13. Waiver of Defaults. The Holders of not less than a
-------------------
majority in aggregate principal amount of the Outstanding Notes, upon written
notice to the Company and the Trustee, may on behalf of the Holders of all the
Notes waive any existing or past Default or Event of Default hereunder and its
consequences, except a default:
(a) in the payment of the principal of (or premium, if any) or
interest on any Notes (including any Note which is required to have been
purchased pursuant to an Offer to Purchase made by the Company); or
(b) in respect of a covenant or provision hereof which under Article
IX cannot be modified or amended without the consent of the Holder of each
Outstanding Note affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs. In any suit for the enforcement
----------------------
of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken, suffered or omitted by it as Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; provided that neither this
--------
Section nor the Trust Indenture Act shall be deemed to authorize any court to
require such an undertaking or to make such an assessment in any suit instituted
by the Company, the Trustee or any Holder, or group of Holders, holding in the
aggregate at least 10% in aggregate principal amount of the Outstanding Notes or
in any suit instituted by any Holder for the enforcement of the payment of
principal of (and premium, if any) or interest on any Notes on or after the
respective Stated Maturities expressed in such Notes (or, in the case of
redemption, on or after the Redemption Date or, in the case of any purchase
required to be made pursuant to an Offer to Purchase, on or after the Purchase
Date).
76
SECTION 5.15. Waiver of Stay, Usury or Extension Laws. The Company
----------------------------------------
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay, usury or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VI
The Trustee
-----------
SECTION 6.01. Certain Duties and Responsibilities. The duties and
------------------------------------
responsibilities of the Trustee shall be as provided by the Trust Indenture Act,
as may be necessary to protect and enforce the rights of the Holders under the
Notes and this Indenture and as otherwise required by the other provisions of
this Indenture. Notwithstanding the foregoing, 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
thereunder, 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.
Whether or not herein or therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
SECTION 6.02. Notice of Defaults. The Trustee shall give the Holders
-------------------
notice of any default that has occurred and is continuing hereunder as and to
the extent provided by the Trust Indenture Act; provided, however, that in the
-------- -------
case of any default of the character specified in Section 5.01(c), no such
notice to Holders shall be given until at least 30 days after the occurrence
thereof. For the purpose of this Section, the term "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default.
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SECTION 6.03. Certain Rights of Trustee. Subject to the provisions
--------------------------
of Section 6.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolu tion, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties.
(b) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution.
(c) Whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically pre scribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate.
(d) The Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel 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.
(e) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its reasonable discretion, may make such
further inquiry or investigation into such facts or matters as it may see
fit, and, if the Trustee shall determine to make such further inquiry or
78
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney.
(g) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent (other than an agent who is an employee
of the Trustee) or attorney appointed with due care by it hereunder.
(h) Except with respect to Section 10.01, the Trustee shall have no
duty to inquire as to the performance by the Company of the covenants set
forth in Article X beyond its good faith review of any certificates or
other notices received by it from the Company.
SECTION 6.04. Not Responsible for Recitals or Issuance of Notes. The
--------------------------------------------------
recitals contained herein and in the Notes, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company, and the Trustee
assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or the
Notes. The Trustee shall not be accountable for the use or application by the
Company of Notes or the proceeds thereof.
SECTION 6.05. May Hold Notes. The Trustee, any Authenticating Agent,
---------------
any Paying Agent, any Note Registrar or any other agent of the Company or the
Trustee, in its individual or any other capacity, may become the owner or
pledgee of Notes and, subject to Sections 6.08 and 6.13, may otherwise deal with
the Company and any other obligor upon the Notes with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Note Registrar
or such other agent.
SECTION 6.06. [Section Intentionally Left Blank]
SECTION 6.07. Compensation and Reimbursement. The Company agrees:
-------------------------------
(a) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all
79
reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its gross negligence, willful misconduct or bad faith; and
(c) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without gross negligence, willful
misconduct or bad faith on its part, arising out of or in connection with
the acceptance or administration of this trust, including the costs and
expenses, of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder;
provided, however, the Trustee shall notify the Company promptly of any
-------- -------
claim for which it may seek indemnity. Failure by the Trustee to so notify
the Company shall not relieve the Company of its obligations hereunder
except to the extent such failure shall have materially prejudiced the
Company. The Company shall defend the claim and the Trustee shall
cooperate in the defense. If the Trustee is advised by counsel in writing
that it may have available to it defenses which are in conflict with the
defenses available to the Company, then the Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.
SECTION 6.08. Disqualification; Conflicting Interests. If the
----------------------------------------
Trustee has or shall acquire a conflicting interest within the meaning of the
Trust Indenture Act, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the Trust Indenture Act and this Indenture.
SECTION 6.09. Corporate Trustee Required; Eligibility. There shall
----------------------------------------
at all times be a Trustee hereunder which shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such, has a combined capital and
surplus of at least $50 million and has its Corporate Trust Office located in
the Borough of Manhattan, The City of New York. If such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined
80
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
SECTION 6.10. Resignation and Removal; Appointment of Successor. (a)
--------------------------------------------------
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in aggregate principal amount of the Outstanding Notes, delivered to
the Trustee and the Company.
(d) If at any time:
(i) the Trustee shall fail to comply with Section 6.08 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Note for at least six months; or
(ii) the Trustee shall cease to be eligible under Section 6.09 and
shall fail to resign after written request therefor by the Company or by
any such Holder; or
(iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee, or (B) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Note for at least six months may, on behalf of himself and all
others similarly situated, petition any court of
81
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in aggregate principal amount of the Outstanding Notes
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder of a Note for at least six months may, on behalf
of himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 1.06. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 6.11. Acceptance of Appointment by Successor. Every
---------------------------------------
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts.
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No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 6.12. Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business. Any corporation into which the Trustee may be merged or converted or
---------
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder; provided such
--------
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Notes shall have been authenticated, but
not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Notes so authenticated with the same effect as if
such successor Trustee had itself authenticated such Notes.
SECTION 6.13. Preferential Collection of Claims Against Company. If
--------------------------------------------------
and when the Trustee shall be or become a creditor of the Company, or any other
obligor upon the Notes, the Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against the Company or
any such other obligor.
SECTION 6.14. Appointment of Authenticating Agent. The Trustee may
------------------------------------
appoint an Authenticating Agent or Agents which shall be authorized to act on
behalf of the Trustee to authenticate Notes issued upon original issue and upon
exchange, registration of transfer, partial redemption or partial purchase or
pursuant to Section 3.07, and Notes so authenticated shall be entitled to the
benefits of this Indenture and shall be valid and obligatory for all purposes as
if such Notes had been authenticated by the Trustee hereunder. Wherever
reference is made in this Indenture to the authentication and delivery of Notes
by the Trustee or the Trustee's certificate of authentication, such reference
shall be deemed to include authentication and delivery on behalf of the Trustee
by an Authenticating Agent and a certificate of authentication executed on
behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent
shall be acceptable to the Company and shall at all times be a corporation
organized and doing business under the laws of the United States of America, any
State thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than $50
million and subject to supervision or examination by Federal or State authority.
83
If such Authenticating Agent publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Authenticating Agent shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published.
If at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent; provided such corporation shall be otherwise eligible
--------
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appoint ment first-class postage prepaid, to each Holder of Notes at such
Holder's address as it appears in the Note Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 6.07.
84
If an appointment is made pursuant to this Section, the Notes may have
endorsed thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
This is one of the Notes described in the within-mentioned Indenture.
--------------------------------'
As Trustee
by ______________________________'
As Authenticating Agent
by _______________________________
Authorized Officer
ARTICLE VII
Holders' Lists and Reports by Trustee and Company
-------------------------------------------------
SECTION 7.01. Company to Furnish Trustee Names and Addresses of
-------------------------------------------------
Holders. The Company will furnish or cause to be furnished to the Trustee:
-------
(a) semiannually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
---------
capacity as Note Registrar.
SECTION 7.02. Preservation of Information; Communications to Holders.
------------------------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.01 and the names and
addresses of Holders received by the Trustee in
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its capacity as Note Registrar. The Trustee may destroy any list furnished to
it as provided in Section 7.01 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Notes, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Notes, by receiving and holding the same, agrees
with the Company, the Subsidiary Guarantors and the Trustee that neither the
Company, the Subsidiary Guarantors nor the Trustee nor any agent of any of them
shall be held accountable by reason of any disclosure of information as to names
and addresses of Holders made pursuant to the Trust Indenture Act.
SECTION 7.03. Reports by Trustee. (a) The Trustee shall transmit to
-------------------
Holders such reports concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each securities exchange
upon which the Notes are listed, with the Commission and with the Company. The
Company will notify the Trustee when the Notes are listed on any securities
exchange.
SECTION 7.04. Reports by Company and Subsidiary Guarantors. The
---------------------------------------------
Company and any Subsidiary Guarantors shall file with the Trustee and the
Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to such Act;
provided that any such information, documents or reports required to be filed
--------
with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall
be filed with the Trustee within 15 days after the same is so required to be
filed with the Commission.
SECTION 7.05. Officers' Certificate with Respect to Change in
-----------------------------------------------
Interest Rates. Within five days after the day on which any Special Interest
---------------
begins accruing, and within five days after any Special Interest ceases to
accrue, the Company shall deliver an Officers' Certificate to the Trustee
stating the interest rate thereupon in effect for the Notes and the date on
which such rate became effective and ceased, as applicable.
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ARTICLE VIII
Merger, Consolidation, etc.
---------------------------
SECTION 8.01. Consolidation, Merger and Sale of Assets. The Company
-----------------------------------------
shall not, directly or indirectly (including through transactions by
Subsidiaries), in a single transaction or through a series of related
transactions, consolidate with or merge with or into any other Person or sell,
assign, transfer, lease or otherwise dispose of all or substantially all of the
properties and assets of the Company and the Subsidiaries on a consolidated
basis to any Person or group of affiliated Persons unless in such a transaction:
(i) either (A) the Company shall be the continuing corporation or (B)
the Person (if other than the Company) formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance,
transfer, lease or disposition the properties and assets of the Company
substantially as an entirety (the "Surviving Entity") shall be a
corporation duly organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia and
shall, in either case, expressly assume all the obligations of the Company
under the Notes and the Indenture;
(ii) immediately before and immediately after giving effect to such
transaction on a pro forma basis, no Default or Event of Default shall have
occurred and be continuing; and
(iii) immediately before and immediately after giving effect to such
transaction on a pro forma basis, except in the case of the consolidation
or merger of any Subsidiary with or into the Company or a Wholly Owned
Subsidiary of the Company, the Company or the Surviving Entity could incur
$1.00 of additional Indebtedness (other than Permitted Indebtedness) under
the Consolidated EBITDA Ratio test in the first paragraph of Section 10.08.
In connection with any consolidation, merger, transfer or lease
contemplated hereby, the Company shall deliver, or cause to be delivered, to the
Trustee, in the form and substance reasonably satisfactory to the Trustee, an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, transfer or lease and the supplemental indenture in
respect thereto comply with the provisions described herein and that all
conditions
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precedent herein provided for or relating to such transaction have been complied
with.
SECTION 8.02. Successor Substituted. Upon any consolidation or
----------------------
merger or any transfer of all or substantially all of the assets of the Company
in accordance with the foregoing, the successor corporation formed by such a
consolidation or into which the Company is merged or to which such transfer is
made shall succeed to, shall be substituted for and may exercise every right and
power of the Company under the Notes and the Indenture, with the same effect as
if such successor corporation had been named as the Company therein and herein.
In the event of any transaction (other than a lease) described and listed in
Section 8.01 in which the Company is not the continuing corporation, the
successor Person formed or remaining shall succeed to, be substituted for and
may exercise every right and power of the Company, and the Company shall be
discharged from all obligations and covenants under the Notes and the Indenture.
ARTICLE IX
Supplemental Indentures
-----------------------
SECTION 9.01. Supplemental Indentures Without Consent of Holders.
---------------------------------------------------
Without the consent of any Holders, the Company, when authorized by a Board
Resolution of the Company and the Trustee, at any time and from time to time,
may enter into one or more indentures supplemental hereto, in form satisfactory
to the Trustee (which form in the case of clause (f) below shall be
substantially similar to the form provided for in Annex D), for any of the
following purposes:
(a) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company herein
and in the Notes; or
(b) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(c) to secure the Notes pursuant to the requirements of Section 10.12
or otherwise; or
(d) to comply with any requirements of the Commission in order to
effect qualification of this Indenture under the Trust Indenture Act in
connection with the issuance of the Exchange Notes and thereafter
88
maintain the qualification of this Indenture under the Trust Indenture Act;
or
(e) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Indenture or the Notes which shall not be inconsistent with the
provisions of this Indenture or the Notes; provided that such action
--------
pursuant to this Clause (e) shall not adversely affect the interests of the
Holders in any material respect; or
(f) subject to the provisions of Section 9.07, to add new Subsidiary
Guarantors; or
(g) to add to, change or eliminate any of the provisions of this
Indenture to permit or facilitate the issuance of Global Notes and matters
related thereto; provided that such action pursuant to this Clause (g)
--------
shall not adversely affect the interests of the Holders in any material
respect; or
(h) to provide for the issuance of Additional Notes in accordance with
Section 3.01(b).
SECTION 9.02. Supplemental Indentures with Consent of Holders. With
------------------------------------------------
the consent of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Notes, by Act of said Holders delivered to the Company
and the Trustee, the Company, when authorized by a Board Resolution of the
Company and the Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders under this Indenture and, subject to Section
5.08, any existing Default or Event of Default and its consequences or
compliance with any provision of this Indenture or the Notes may be waived;
provided, however, that no such supplemental indenture shall, without the
-------- -------
consent of the Holder of each Outstanding Note affected thereby:
(a) change the Stated Maturity of the principal of, or any installment
of interest on, any Note, or reduce the principal amount thereof or the
rate of interest thereon or any premium payable upon the redemption
thereof, or change the place of payment where, or the coin or currency in
which, any Note or any premium or interest thereon is payable, or impair
89
the right to institute suit for the enforcement of any such payment on or
after the Stated Maturity thereof (or, in the case of redemption, on or
after the Redemption Date or, in the case of an Offer to Purchase which has
been made, on or after the applicable Purchase Date); or
(b) reduce the percentage in principal amount of the Outstanding
Notes, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture; or
(c) modify any of the provisions of this Section, Section 5.13 or
Section 10.22 except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Note affected
thereby; or
(d) modify any of the provisions of Article XIV of this Indenture or
any indenture supplemental hereto, in the form of Annex D, if any, in a
manner adverse to the Holders in any material respect; or
(e) modify Sections 10.14 and 10.15 of this Indenture in a manner
adverse to the Holders in any material respect; or
(f) following the mailing to a Holder of an Offer Document with
respect to an Offer to Purchase, modify the provisions of this Indenture
with respect to such Offer to Purchase in a manner adverse to such Holder
in any material respect.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 9.03. Execution of Supplemental Indentures. In executing, or
-------------------------------------
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
6.01) shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such
90
supplemental indenture which adversely affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indentures. Upon the execution
----------------------------------
of any supplemental indenture under this Article, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Notes theretofore
or thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 9.05. Conformity with Trust Indenture Act. Every
------------------------------------
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.
SECTION 9.06. Reference in Notes to Supplemental Indentures. Notes
---------------------------------------------
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Notes so
modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding Notes.
SECTION 9.07. Execution of Supplemental Indentures for Subsidiary
---------------------------------------------------
Guaranties. In executing, or accepting the trusts created by, any supplemental
----------
indenture executed pursuant to Section 9.01(f), the Trustee shall be entitled to
receive an Opinion of Counsel stating that such supplemental indenture and other
documents required to be provided pursuant to the definition of Subsidiary
Guarantor have been duly authorized, executed and delivered by such Subsidiary
and the supplemental indenture and each other document constitutes a legal,
valid, binding and enforceable obligation of such Subsidiary Guarantor.
SECTION 9.08. Revocation and Effect of Consents of Holders. Until a
---------------------------------------------
supplemental indenture becomes effective, a consent to it by a Holder is a
continuing consent by the Holder and every subsequent Holder of that Note or
portion of that Note that evidences the same debt as the consenting Holder's
Note, even if notation of the consent is not made on any Note. However, except
as provided in the succeeding paragraph, any such Holder or subsequent Holder
may revoke the consent as to his Note or portion of a Note. Such revocation
shall be effective only if the Trustee receives written notice of such
revocation
91
before the date the supplemental indenture becomes effective.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any supplemental
indenture. If a record date is fixed, then, notwithstanding the last two
sentences of the immediately preceding paragraph, those Persons who were Holders
at such record date (or their duly designated proxies), and only those Persons
who were Holders at such record date (or their duly designated proxies), and
only those Persons, shall be entitled to consent to such supplemental indenture
by written notice received by the Trustee or withdraw any consent previously
given, whether or not such Persons continue to be Holders after such record
date. No such consent shall be valid or effective for more than 90 days after
such record date, unless the relevant supplemental indenture to which such
consent relates has become effective, in which event such Persons who were
Holders at such record date shall no longer be entitled to revoke any consent
previously given and such consent shall continue to be valid and effective.
ARTICLE X
Covenants
---------
SECTION 10.01. Payment of Principal, Premium and Interest. The
-------------------------------------------
Company will duly and punctually pay the principal of (and premium, if any) and
interest on the Notes in accordance with the terms of the Notes and this
Indenture.
SECTION 10.02. Maintenance of Office or Agency. The Company will
--------------------------------
maintain in the Borough of Manhattan, The City of New York, an office or agency
where Notes may be presented or surrendered for payment, where Notes may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.
92
The Company may also from time to time designate one or more other
offices or agencies (in or outside the Borough of Manhattan, The City of New
York) where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
-------- -------
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Company will give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
SECTION 10.03. Money for Notes Payments To Be Held in Trust. If the
---------------------------------------------
Company shall at any time act as its own Paying Agent, it will, on or before
each due date of the principal of (and premium, if any) or interest on any of
the Notes, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and will promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will, on
or prior to each due date of the principal of (and premium, if any) or interest
on any Notes, deposit with a Paying Agent a sum sufficient to pay such amount,
such sum to be held as provided by the Trust Indenture Act, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will (a) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent (or, until such time as this Indenture shall
be qualified under the Trust Indenture Act, which would be applicable to it as
Paying Agent if the Indenture were so qualified) and (b) during the continuance
of any default by the Company (or any other obligor upon the Notes) in the
making of any payment in respect of the Notes, upon the written request of the
Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent as such.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
93
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Subject to any applicable abandoned property laws, any money deposited
with the Trustee or any Paying Agent, or then held by the Company, in trust for
the payment of the principal of (and premium, if any) or interest on any Notes
and remaining unclaimed for two years after such principal (and premium, if any)
or interest has become due and payable shall be paid to the Company on Company
Request, or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Notes shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
-------- -------
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation in The City of New York, notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company.
SECTION 10.04. Existence. Subject to Article VIII, the Company will
----------
do or cause to be done all things necessary to preserve and keep in full force
and effect its existence, rights (charter and statutory) and franchises;
provided, however, that the Company shall not be required to preserve any such
-------- -------
right or franchise if the Board of Directors of the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Company and that the loss thereof would not be reasonably expected to
have a material adverse effect on the Company's ability to perform its
obligations hereunder or under the Notes.
SECTION 10.05. Maintenance of Properties. The Company will cause
--------------------------
substantially all properties used or useful in the conduct of its business or
the business of any Subsidiary to be maintained and kept in good working order,
reasonable wear and tear excepted, and supplied with all necessary equipment and
will cause to be made all necessary repairs, renewals, replacements, betterments
and improvements thereof, all as in the judgment of the Company
94
may be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
-------- -------
nothing in this Section shall prevent the Company or any Subsidiary from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and would not be reasonably
expected to have a material adverse effect on the Company's ability to perform
its obligations hereunder or under the Notes.
SECTION 10.06. Payment of Taxes and Other Claims. The Company will
----------------------------------
pay or discharge or cause to be paid or discharged (a) all taxes, assessments
and governmental charges levied or imposed upon the Company or any of its
Subsidiaries or upon the income, profits or property of the Company or any of
its Subsidiaries, and (b) all lawful claims for labor, materials and supplies
which, if unpaid, might by law become a lien upon the property of the Company or
any of its Subsidiaries; provided, however, that the Company shall not be
-------- -------
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings.
SECTION 10.07. Maintenance of Insurance. The Company shall, and the
-------------------------
Company shall cause its Subsidiaries to, keep at all times all of their
properties which are of an insurable nature insured against loss or damage with
insurers believed by the Company to be responsible in accordance with good
business practice.
SECTION 10.08. Limitation on Indebtedness and Subsidiary Preferred
---------------------------------------------------
Stock. The Company shall not Incur any Indebtedness, and shall not permit any
------
of its Subsidiaries to Incur any Indebtedness or Preferred Stock (excluding in
each case Permitted Indebtedness), except that the Company or a Subsidiary
Guarantor may Incur Indebtedness if at the time of such Incurrence and after
giving effect thereto on a pro forma basis the Company's Consolidated EBITDA
Ratio for the four (4) full fiscal quarters immediately preceding such event,
taken as one period calculated on the assumption that such Indebtedness had been
Incurred on the first day of such four quarter period, is greater than or equal
to 2.00:1.00.
Without regard to the foregoing limitations, the Company and its
Subsidiaries may Incur the following ("Permitted Indebtedness"):
(i) Indebtedness of the Company under the Notes other than any
Additional Notes;
95
(ii) Indebtedness of the Company under the Bank Facility, provided
--------
that the aggregate principal amount at any time outstanding thereunder
shall not exceed the maximum commitment provided thereunder at such time;
(iii) Indebtedness of the Company or any of its Subsidiaries
outstanding on the Issue Date;
(iv) Indebtedness of the Company or any of its Subsidiaries
consisting of Permitted Hedging Agreements;
(v) Indebtedness of any Wholly Owned Subsidiary of the Company owed
to and held by the Company or owed to and held by another Wholly Owned
Subsidiary;
(vi) Indebtedness or Preferred Stock Incurred by a Person prior to
the time (A) such Person became a Subsidiary of the Company or (B) such
Person is amalgamated, merged or consolidated with or into the Company or a
Subsidiary of the Company, which Indebtedness or Preferred Stock was not
Incurred in anticipation of such transaction and was outstanding prior to
such transaction; provided that (1) such Person is or becomes a Subsidiary
--------
Guarantor and (2) after giving pro forma effect in the calculation of the
Consolidated EBITDA Ratio to (x) such transaction and (y) any Refinancing
of Indebtedness or Preferred Stock that occurs concurrently with such
transaction, and treating any Indebtedness or Preferred Stock of such
acquired Person as having been Incurred at the time of such transaction,
the Company could Incur at least $1.00 of additional Indebtedness pursuant
to the ratio test specified in the first paragraph of this covenant;
(vii) Indebtedness of the Company or a Subsidiary Guarantor Incurred
in exchange for or to renew, extend, refinance, replace or refund
(collectively "Refinance") any outstanding Indebtedness Incurred (x)
pursuant to the ratio test set forth in the first paragraph of this
covenant or (y) pursuant to clauses (i), (iii) (other than Indebtedness
proposed to be repaid with the proceeds of the Notes) or (vi) above;
provided, however, that such Indebtedness does not exceed the principal
-------- -------
amount of Indebtedness so Refinanced plus the amount of any premium
required to be paid or reasonably determined by the Company to be necessary
to accomplish such Refinancing plus the amount of the fees and expenses of
the Company reasonably incurred in connection with such Refinancing; and
provided further, that Indebtedness the proceeds of which are used to
----------------
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Refinance the Notes, Indebtedness which is pari passu to the Notes or a
---- -----
Subsidiary Guaranty, or Indebtedness which is subordinate in right of
payment to the Notes or a Subsidiary Guaranty shall only be permitted if
(A) in the case of any Refinancing of Indebtedness which is pari passu to
---- -----
the Notes or a Subsidiary Guaranty, the Refinancing Indebtedness is made
pari passu to the Notes or such Subsidiary Guaranty, or subordinated to the
---- -----
Notes or such Subsidiary Guaranty, and, in the case of any Refinancing of
Indebtedness which is subordinated to the Notes or a Subsidiary Guaranty,
the Refinancing Indebtedness is made subordinated to the Notes or such
Subsidiary Guaranty, to substantially the same extent as, or a greater
extent than, the Notes or such Subsidiary Guaranty are subordinated to
Senior Indebtedness of the Company or such Subsidiary as described under
the subordination provisions described under "Subordination" above and (B)
such Refinancing Indebtedness (x) does not have a final Stated Maturity
earlier than the final Stated Maturity of the Refinanced Indebtedness or
permit redemption or other retirement of such Indebtedness (including
pursuant to an offer to purchase by the Company) at the option of the
holder thereof prior to the final Stated Maturity of the Indebtedness being
Refinanced, other than a redemption or other retirement at the option of
the holder of such Indebtedness on terms and in circumstances that are
substantially similar to those on and in which the Indebtedness being
Refinanced may be redeemed or otherwise retired and (y) does not have a
Weighted Average Life less than the Weighted Average Life of the
Indebtedness being Refinanced;
(viii) Indebtedness of any Subsidiary Guarantor consisting of a
Guaranty of the Notes or any Senior Indebtedness of the Company Incurred in
compliance with this covenant;
(ix) Indebtedness of the Company or any of its Subsidiaries in
connection with one or more trade or standby letters of credit (not
constituting Guaranties of Indebtedness) or performance, surety, indemnity,
statutory or similar bonds, in each case, issued in the ordinary course of
business or pursuant to self-insurance obligations;
(x) Indebtedness of the Company or any of its Subsidiaries
represented by property, liability and workers' compensation insurance
(which may be in the form of letters of credit);
97
(xi) Indebtedness of the Company (including Guaranties) relating to
"turnkey" store construction programs in an aggregate principal amount not
to exceed $25 million at any time outstanding;
(xii) Indebtedness of the Company and the Subsidiary Guarantors, in
addition to Indebtedness otherwise permitted to be incurred pursuant to
clauses (i) through (xi) above, that does not exceed $35 million aggregate
principal amount at any time outstanding.
For purposes of determining compliance with this Section 10.08, in the
event that an item of Indebtedness meets the criteria of more than one of the
types of Indebtedness the Company or a Subsidiary is permitted to Incur pursuant
to the foregoing clauses (i) through (xii) or pursuant to the first paragraph of
this covenant, the Company shall have the right, in its sole discretion, to
classify such item of Indebtedness and shall only be required to include the
amount and type of such Indebtedness under the clause permitting the
Indebtedness as so classified.
SECTION 10.09. Limitation on Senior Subordinated Indebtedness. The
-----------------------------------------------
Company will not incur, create, issue, assume, guarantee or otherwise become
liable for any Indebtedness that is subordinate or junior in right of payment to
any Senior Indebtedness unless (i) such Indebtedness is pari passu or
---- -----
subordinated in right of payment to the Notes and (ii) such Indebtedness (A) has
a final Stated Maturity which (1) in the case of Indebtedness that is pari passu
---- -----
in right of payment with the Notes, is not earlier than the final Stated
Maturity of the Notes and (2) in the case of Indebtedness which is subordinate
in right of payment of the Notes is later than the final Stated Maturity of the
Notes and (B) has a Weighted Average Life which (1) in the case of Indebtedness
that is pari passu in right of payment to the Notes, is not shorter than the
---- -----
Weighted Average Life of the Notes and (2) in the case of Indebtedness that is
subordinate in right of payment to the Notes, is longer than the Weighted
Average Life of the Notes.
SECTION 10.10. Limitation on Restricted Payments. Neither the
----------------------------------
Company nor any of its Subsidiaries shall, directly or indirectly:
(i) declare or pay any dividend, or make any distribution, of any
kind or character (whether in cash, property or securities) in respect of
the Capital Stock of the Company or to the holders thereof in their
capacity as such (excluding any dividends or
98
distributions (x) to the extent payable in shares of the Capital Stock of
the Company (other than Redeemable Interests) or in options, warrants or
other rights to acquire the Capital Stock of the Company (other than
Redeemable Interests), (y) to the extent paid by a Subsidiary to another
Subsidiary or to the Company and (z) which are paid in cash on a pro rata
basis by a Subsidiary to holders of both minority and majority interests in
such Subsidiary);
(ii) purchase, redeem or otherwise acquire or retire for value (a)
any Capital Stock of the Company (other than the Company's 10% Preferred
Stock) or any Capital Stock of or other ownership interests in any
Subsidiary or any Affiliate or Related Person of the Company or (b) any
options, warrants or rights to purchase or acquire shares of Capital Stock
of the Company or any Capital Stock of or other ownership interests in any
Subsidiary or any Affiliate or Related Person of the Company (excluding, in
each case of (a) and (b), the purchase, redemption, acquisition or
retirement by any Subsidiary of any of its Capital Stock, other ownership
interests or options, warrants or rights to purchase such Capital Stock or
other ownership interests, in each case, owned by the Company or a Wholly
Owned Subsidiary);
(iii) make any Investment other than a Permitted Investment; or
(iv) redeem, defease, repurchase, retire or otherwise acquire or
retire for value prior to any scheduled maturity, repayment or sinking fund
payment, Indebtedness of the Company that is subordinate in right of
payment to the Notes;
(each of the transactions described in clauses (i) through (iv) being a
"Restricted Payment"), if both before and after giving effect to such Restricted
Payment:
(1) an Event of Default, or an event that with the lapse of time or
the giving of notice, or both, would constitute an Event of Default, shall
have occurred and be continuing;
(2) the Company would, if such Restricted Payment had been made at the
beginning of the most recently ended four full fiscal quarter period for
which internal financial statements are available immediately preceding the
date of such Restricted Payment, not have been permitted to Incur at least
$1.00 of additional Indebtedness pursuant to the Consolidated EBITDA
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Coverage Ratio test set forth in the first paragraph of Section 10.08; or
(3) the aggregate of all Restricted Payments (excluding Restricted
Payments permitted by clauses (ii) and (iii) of the next succeeding
paragraph) from the date of the Indenture (the amount so expended, if other
than in cash, determined in good faith by the Board of Directors) exceeds
the sum, without duplication, of: (a) 50% of the aggregate Consolidated
Net Income (or, in case Consolidated Net Income shall be negative, less
100% of such deficit) for the period (taken as one accounting period) from
the beginning of the first fiscal quarter commencing after the date of the
Indenture to the end of the Company's most recently ended fiscal quarter
for which internal financial statements are available at the time of such
Restricted Payment; (b) 100% of the aggregate net proceeds, including the
fair market value of property other than cash (as determined in good faith
by a resolution of the Board of Directors), received by the Company after
the Issue Date from the issuance and sale of Capital Stock (other than
Redeemable Interests) of the Company and options, warrants or other rights
to acquire Capital Stock (other than Redeemable Interests and Indebtedness
convertible into Capital Stock) of the Company and the principal amount of
Indebtedness and Redeemable Interests of the Company that has been
converted into Capital Stock (other than Redeemable Interests) of the
Company after the date of the Indenture, provided that any such net
--------
proceeds received by the Company from an employee stock ownership plan
financed by loans from the Company or a Subsidiary of the Company shall be
included only to the extent such loans have been repaid with cash on or
prior to the date of determination.
The foregoing covenant will not be violated by reason of:
(i) the payment of any dividend within 60 days after declaration
thereof if at the declaration date such payment would have complied with
the foregoing covenant;
(ii) any Refinancing of Indebtedness permitted pursuant to clause
(vii) of the definition of Permitted Indebtedness or in exchange for or in
an amount not in excess of the amount of the net cash proceeds of a
substantially concurrent sale (other than to a Subsidiary or employee stock
ownership plan financed by loans from the Company or a Subsidiary of the
Company)
100
of Capital Stock (other than Redeemable Interests) of the Company; provided
--------
that the amount of any such net cash proceeds that are utilized for any
such purchase, redemption or other acquisition or retirement for value
shall be excluded from Clause (3)(b) in the foregoing paragraph;
(iii) the purchase, redemption or other acquisition or retirement
for value of any Capital Stock of the Company or any options, warrants or
rights to purchase or acquire shares of Capital Stock of the Company in
exchange for, or in an amount not in excess of the net cash proceeds of,
the substantially concurrent sale (other than to a Subsidiary or employee
stock ownership plan financed by loans from the Company or a Subsidiary of
the Company) of Capital Stock (other than Redeemable Interests) of the
Company; provided that the amount of any such net cash proceeds that are
--------
utilized for any such purchase, redemption or other acquisition or
retirement for value shall be excluded from Clause (3)(b) in the foregoing
paragraph;
(iv) the purchase of Capital Stock of the Company, or options,
warrants or rights to purchase or acquire shares of Capital Stock of the
Company, from employees or former employees of the Company or its
Subsidiaries (or their estates or beneficiaries thereof) upon death,
disability, retirement or termination of employment in an amount not to
exceed a $2 million in any fiscal year (plus the amounts, if any, paid
pursuant to the exercise by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ of repurchase rights relating to options granted under the
Company's 1992 Nonqualified Stock Option Plan); provided, however, that the
-------- -------
net cash proceeds received from the sale of qualified Capital Stock of the
Company to employees of the Company or its Subsidiaries during such fiscal
year shall be added to the limitation set forth in this clause (iv) and,
any excess of such net cash proceeds received in each fiscal year over the
total gross proceeds used to make purchases which qualify under this clause
(iv) for such fiscal year shall be added to the limitation in the next
fiscal year; provided further that the amount of any such net cash proceeds
----------------
that are utilized for any such purchase shall be excluded from clause
(3)(b) in the foregoing paragraph; and
(v) the purchase or redemption of subordinated Indebtedness
pursuant to asset sale or change of control of provisions contained in the
Indenture or other governing instrument relating thereto; provided
--------
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that (a) no offer or purchase obligation may be triggered in respect of
such Indebtedness unless a corresponding obligation also arises for the
Notes; and (b) in all events, no repurchase or redemption of such
Indebtedness may be consummated unless and until the Company shall have
satisfied all repurchase obligations with respect to any required purchase
offer made with respect to the Notes.
SECTION 10.11. Limitations Concerning Distributions by Subsidiaries.
-----------------------------------------------------
The Company may not, and may not permit any Subsidiary to, suffer to exist any
consensual encumbrance or restriction on the ability of such Subsidiary (i) to
pay, directly or indirectly, dividends or make any other distributions in
respect of its Capital Stock or other ownership interests or pay any
Indebtedness or other obligation owed to the Company or any other Subsidiary;
(ii) to make loans or advances to the Company or any other Subsidiary; or (iii)
to sell, lease or transfer any of its property or assets to the Company or any
Wholly Owned Subsidiary, except, in any such case, any encumbrance or
restriction:
(a) pursuant to the Notes, the Indenture or any other agreement in
effect on the date of the Indenture;
(b) pursuant to the Bank Facility, including any Guaranties of or
Liens securing the Senior Indebtedness Incurred thereunder;
(c) pursuant to an agreement relating to any Indebtedness Incurred by
a Person prior to the time (A) such Person became a Subsidiary of the
Company or (B) such Person is amalgamated, merged or consolidated with a
Subsidiary of the Company, which Indebtedness was not Incurred in
anticipation of such transaction and was outstanding prior to such
transaction;
(d) pursuant to an agreement which has been entered into for the
pending sale or disposition of all or substantially all of the Capital
Stock, other ownership interests or assets of such Subsidiary, provided
--------
that such restriction terminates upon consummation or abandonment of such
disposition and upon termination of such agreement;
(e) pursuant to customary non-assignment provisions in leases or other
agreements entered into in the ordinary course of business;
(f) pursuant to purchase money obligations for property acquired in
the ordinary course of business or
102
liens in connection therewith that impose restrictions of the nature
described in Clause (iii) above on the property so acquired; or
(g) pursuant to an agreement effecting a refinancing of Indebtedness
Incurred pursuant to an agreement referred to in clause (a), (b) or (c)
above; provided, however, that the provisions relating to such encumbrance
-------- -------
or restriction contained in such renewal, extension, refinancing or
refunding agreement are no more restrictive in any material respect than
the provisions contained in the agreement it replaces, as determined in
good faith by the Board of Directors.
SECTION 10.12. Limitation on Certain Liens. (a) The Company may
----------------------------
not, and may not permit any Subsidiary to, Incur any Lien on property or assets
of the Company or such Subsidiary to secure Indebtedness that is pari passu or
---- -----
subordinate in right of payment to the Notes without making, or causing such
Subsidiary to make, effective provision for securing the Notes (and, if the
Company so determines, any other Indebtedness of the Company or of such
Subsidiary that is not pari passu with or subordinated in right of payment to
---- -----
the Notes) so that, (i) in the case of a Lien securing Indebtedness that is pari
----
passu with the Notes the Lien securing the Notes is senior in priority or pari
----- ----
passu with the Lien securing such Indebtedness and (ii) in the case of a Lien
-----
securing Indebtedness that is subordinated in right of payment to the Notes the
Lien securing the Notes is senior in priority to the Lien.
(b) Notwithstanding the foregoing, any security interest granted by
the Company or any Subsidiary to secure the Notes created pursuant to paragraph
(a) above shall provide by its terms that such security interest shall be
automatically and unconditionally released and discharged upon the release by
the holders of the Indebtedness of the Company or any Subsidiary described in
paragraph (a) above of their security interest (including any deemed release
upon payment in full of all obligations under such Indebtedness), at a time when
(A) no other Indebtedness that is pari passu or subordinated in right of payment
---- -----
to the Notes has been secured by such property or assets of the Company or any
such Subsidiary or (B) the holders of all such other Indebtedness which is
secured by such property or assets of the Company or any such Subsidiary release
their security interest in such property or assets (including any deemed release
upon payment in full of all obligations under such Indebtedness).
SECTION 10.13. Limitation on Transactions with Affiliates. The
-------------------------------------------
Company may not, directly or indirectly,
103
enter into any transaction (or series of related transactions) after the date of
the Indenture with any Affiliate or Related Person unless:
(i) such Affiliate or Related Person is (both before and after such
transaction) (a) a Wholly Owned Subsidiary of the Company or (b) another
Subsidiary of the Company the minority interests in which are not held by
any Affiliate or Related Person; or
(ii) where the total consideration given or to be provided by the
Company or such Subsidiary in or pursuant to such transaction (or series)
(including cash, the fair value of non-cash property and the assumption of
Indebtedness (a) will be no more than $1 million, the Chief Executive
Officer, the Chief Operating Officer or the Chief Financial Officer
certifies in an Officer's Certificate that the terms of the transaction (or
series) are in the best interests of the Company and are no less favorable
to the Company than those that could be obtained in a comparable arm's-
length transaction with an entity that is not an Affiliate or Related
Person, (b) will be in excess of $1 million but no more than $5 million, a
majority of the disinterested members of the Board of Directors determines
in its good faith judgment that the terms of the transaction are in the
best interests of the Company and are no less favorable to the Company than
those that could be obtained in a comparable arm's-length transaction with
an entity that is not an Affiliate or a Related Person; or (c) will be in
excess of $5 million (1) the Company complies with the foregoing clause (b)
and (2) the Company obtains a written opinion addressed to the Board of
Directors prior to consummation of such transaction (or series) from a
nationally recognized investment banking firm (which may not be an
Affiliate or Related Person of the Company) that the terms of the
transaction (or series) are fair to the Company from a financial point of
view.
Notwithstanding the foregoing limitation, the Company and its
Subsidiaries may enter into or suffer to exist the following:
(i) any transaction pursuant to any contract in existence on the
Closing Date;
(ii) any Restricted Payment permitted to be made pursuant to the
provisions of Section 10.10;
(iii) any transaction or series of transactions between the Company
and one or more of its Subsidiaries
104
or between two or more of its Subsidiaries (provided that no more than 5%
--------
of the equity interest in any such Subsidiary is owned, directly or
indirectly (other than by direct or indirect ownership of an equity
interest in the Company), by any Affiliate or Related Person of the Company
other than a Subsidiary);
(iv) the payment of compensation (including amounts paid pursuant to
employee benefit plans) for the personal services of officers, directors
and employees of the Company or any of its Subsidiaries in the ordinary
course of business;
(v) loans or advances for travel expenses, relocation expenses and
other amounts in the ordinary course of business;
(vi) loans to employees to purchase Capital Stock of the Company or
pay income taxes in respect of awards of Capital Stock in the ordinary
course of business not in excess of $2.5 million at any time Outstanding
(exclusive of loans outstanding on the Issue Date); and
(vii) sales of Capital Stock (other than Redeemable Interests) of the
Company, when such sales are exclusively for cash.
SECTION 10.14. Limitation on Asset Dispositions.
---------------------------------
(a) The Company may not make and may not permit any Subsidiary to make any
Asset Disposition unless:
(i) the Company receives consideration at the time of such disposition
at least equal to the fair market value of the shares or the assets
disposed of, as determined in good faith by the Board of Directors for any
transaction (or series of transactions) involving in excess of $1 million;
(ii) at least 75% of the consideration received by the Company
consists of (x) cash or Cash Equivalents, (y) the assumption of
Indebtedness or other liabilities reflected on the consolidated balance
sheet of the Company in accordance with GAAP (excluding Indebtedness or any
other liabilities subordinate in right of payment to the Notes) and release
from all liability on such Indebtedness or other liabilities assumed or (z)
any combination thereof (except that this clause (ii) shall not apply to
any sale of all or a portion of the Company's Far West equipment
manufacturing division); and
105
(iii) 100% of the Net Available Proceeds from such Asset Disposition
(including from the sale of any marketable Cash Equivalents received
therein) are applied by the Company within one year from the later of the
date of such Asset Disposition or the receipt of such Net Available
Proceeds, (A) first, to repayment of Senior Indebtedness of the Company
- -----
then outstanding under any agreements or instruments which would require
such application or which would prohibit payments pursuant to Clause (C)
following; (B) second, to the repayment of Senior Indebtedness of the
------
Company then outstanding, if so elected by the Company, provided that the
--------
amount of such Senior Indebtedness outstanding, or permitted to be borrowed
under the relevant facility or agreement, is permanently reduced in an
amount equal to the amount so prepaid; (C) third, to the extent Net
-----
Available Proceeds are not applied to Senior Indebtedness as specified in
clause (A) or (B), to purchases of Outstanding Notes pursuant to an Offer
to Purchase (to the extent such an offer is not prohibited by the terms of
any Senior Indebtedness then outstanding) at a purchase price equal to 100%
of their principal amount plus accrued interest to the date of purchase
(the "Offer Price") (subject to the rights of Holders of record on the
relevant Regular Record Date to receive interest due on an Interest Payment
Date that is on or prior to the purchase date) and, to the extent required
by the terms thereof, any other Indebtedness of the Company that is pari
----
passu with the Notes on a pro rata basis at a price no greater than 100% of
-----
the principal amount thereof plus accrued interest to the date of purchase;
and (D) fourth, to the extent of any remaining Net Available Proceeds
------
following completion of such Offer to Purchase, to any other use as
determined by the Company which is not otherwise prohibited by the
Indenture.
Notwithstanding the foregoing, the Company will not be required to
comply with the provisions of the Indenture described in clause (iii) of the
preceding paragraph, (x) if the Net Available Proceeds (less any amounts
("Reinvested Amounts") that are invested within 360 days from the later of the
date of the related Asset Disposition and the receipt of such Net Available
Proceeds in assets that will be used in the Franchising Business (determined by
the Board of Directors in good faith)) are less than $5 million is this
paragraph (such lesser amount to be carried forward on a cumulative basis for
purposes of determining the application of this paragraph) or (y) to the extent
the Company elects to redeem the Notes with the Net Available Proceeds pursuant
to the first paragraph of Section 11.01. For purposes of clause (x) of the
preceding
106
sentence, there shall be used in performing such calculation only those Net
Available Proceeds that have not been invested or applied, as the case may be,
as contemplated by such clause (x) or clauses (A),(B) or (C) of clause (iii) of
the immediately preceding paragraph within the 360-day or one-year period
allotted, as the case may be, for such investment or application.
(b) The Company shall mail the Offer Document for an Offer to
Purchase required pursuant to Section 10.14(a) within 30 days after the date on
which the aggregate amount of Net Available Proceeds is equal to or exceeds $5
million (such aggregate amount of Net Available Proceeds to be determined in
accordance with the last paragraph of clause (a) immediately above). The
aggregate principal amount of the Notes to be offered to be purchased pursuant
to the Offer to Purchase shall equal the Net Available Proceeds required to be
made available therefor pursuant to Clause (iii)(C) of Section 10.14(a) (rounded
down to the next lowest integral multiple of $1,000). Each Holder shall be
entitled to tender all or any portion of the Notes owned by such Holder pursuant
to the Offer to Purchase, subject to the requirement that any portion of a Note
tendered must be tendered in an integral multiple of $1,000 principal amount.
The Company shall not be entitled to any credit against its
obligations under this Section 10.14 for the principal amount of any Notes
acquired or redeemed by the Company otherwise than pursuant to the Offer to
Purchase pursuant to this Section 10.14.
(c) Not later than the date of the Offer Document with respect to an
Offer to Purchase pursuant to this Section 10.14, the Company shall deliver to
the Trustee an Officers' Certificate as to (i) the Purchase Amount, (ii) the
allocation of the Net Available Proceeds from the Asset Disposition pursuant to
which such Offer to Purchase is being made, including, with respect to
Reinvested Amounts, that such assets will be used in the Franchising Business,
and (iii) the compliance of such allocation with the provisions of Section
10.14(a).
The Company shall perform its obligations specified in the Offer
Document for the Offer to Purchase. On or prior to the Purchase Date, the
Company shall (i) accept for payment (on a pro rata basis, if necessary) of the
Notes or portions thereof tendered pursuant to the Offer to Purchase, (ii)
deposit with the Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 10.03) money
sufficient to pay the purchase price of all Notes or portions thereof so
accepted and (iii) deliver or cause to
107
be delivered to the Trustee all Notes so accepted together with an Officers'
Certificate stating the Notes or portions thereof accepted for payment by the
Company. The Paying Agent (or the Company, if so acting) shall promptly mail or
deliver to Holders of Notes so accepted payment in an amount equal to the
Purchase Price for each $1,000 principal amount of Notes so accepted, and the
Company shall promptly execute a new Note or Notes equal in principal amount to
any unpurchased portion of the Note surrendered, and the Subsidiary Guarantors,
if any, shall promptly execute their Subsidiary Guaranties to be endorsed
thereon, and thereafter the Trustee shall promptly authenticate and mail or
deliver to such Holders such new Note or Notes. Any Note not accepted for
payment shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Offer to
Purchase on or as soon as practicable after the Purchase Date.
Notes to be purchased shall, on the Purchase Date, be due and payable
and after such date (unless the Company shall default in the payment of the
Purchase Price) such Notes shall cease to bear interest; provided, however, that
installments of interest whose Stated Maturity or date of scheduled payment is
on or prior to the Purchase Date shall be payable to the Holders of such Notes,
or one or more Predecessor Notes, registered as such on the relevant record date
according to their terms and the provisions of Section 3.08 hereof. If any Note
tendered for purchase shall not be so paid upon surrender thereof by deposit of
funds with the Trustee or the Paying Agent, the principal thereof (and premium,
if any) shall, until paid, bear interest from the Purchase Date at the default
rate provided for by such Note.
The Company shall comply with the applicable tender offer rules,
including Rule 14e under the Exchange Act, and any other applicable securities
laws or regulations in connection with an Offer to Purchase. To the extent that
such laws and regulations are inconsistent with this Section 10.14, such laws
and regulations will control.
(d) Notwithstanding the foregoing, this Section 10.14 shall not apply
to any Asset Disposition which constitutes a transfer, conveyance, sale, lease
or other disposition of all or substantially all of the properties and assets of
the Company and its Subsidiaries subject to Section 8.01.
SECTION 10.15. Offer to Purchase Upon Change of Control. Upon the
-----------------------------------------
occurrence of a Change of Control, the Company will be required to make an offer
(a "Change of Control Offer") to purchase all Outstanding Notes at a
108
purchase price (the "Change of Control Purchase Price") equal to 101% of their
principal amount plus accrued and unpaid interest, if any, to the date of
purchase; provided, however, that installments of interest whose Stated Maturity
-------- -------
or date scheduled payment is on or prior to the date of purchase shall be
payable to the Holders of such Notes, or one or more Predecessor Notes,
registered as such at the close of business on the relevant record date
according to their terms and the provisions of Section 3.08.
The Company shall, within 30 days following the date the Company
becomes aware of the consummation of a transaction that results in a Change of
Control, mail an Offer Document with respect to an Offer to Purchase all
Outstanding Notes. Each holder shall be entitled to tender all or any portion
of the Notes owned by such Holder pursuant to the Offer to Purchase, subject to
the requirement that any portion of a Note tendered must be tendered in an
integral multiple of $1,000 principal amount. Any Note that is to be purchased
only in part shall be surrendered to the Paying Agent with, if the Company or
Trustee so requires, due endorsement by or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing.
The Company shall perform its obligations specified in the Offer
Document for the Offer to Purchase. On or prior to the Purchase Date, the
Company shall (i) accept for payment Notes or portions thereof tendered pursuant
to the Offer to Purchase, (ii) deposit with the Paying Agent (or, if the Company
is acting as its own Paying Agent, segregate and hold in trust as provided in
Section 10.03) money sufficient to pay the Purchase Price of all Notes or
portions thereof so accepted and (iii) deliver or cause to be delivered to the
Trustee all Notes so accepted together with an Officers' Certificate stating the
Notes or portions thereof accepted for payment by the Company. The Paying Agent
(or the Company, if so acting) shall promptly mail or deliver to Holders of
Notes so accepted payment in an amount equal to the Purchase Price for each
$1,000 of Notes so accepted, and the Company shall promptly execute and the
Trustee shall, upon receipt of such Officers' Certificate, promptly authenticate
and mail or deliver to such Holders a new Note or Notes equal in principal
amount to any unpurchased portion of the Note surrendered as requested by the
Holder. Any Note not accepted for payment shall be promptly mailed or delivered
by the Company to the Holder thereof. The Company shall publicly announce the
results of the Offer to Purchase on or as soon as practicable after the Purchase
Date.
109
Unless the Company defaults in the payment of the Purchase Price, any
Note accepted for payment pursuant to the Offer to Purchase shall cease to
accrue interest after the Purchase Date. If an offer is made to repurchase the
Notes pursuant to a Change of Control Offer, the Company shall comply with all
tender offer rules under state and Federal securities laws, including, but not
limited to, Section 14(e) under the Exchange Act and Rule 14(e) thereunder, to
the extent applicable to such offer. To the extent that such laws and
regulations are inconsistent with this Section 10.15, such laws and regulations
will control.
SECTION 10.16. Provision of Financial Information. Whether or not
-----------------------------------
the Company is required to be subject to Section 13(a) or 15(d) of the Exchange
Act or any successor provision thereto, to the extent permitted by the
Commission, the Company will file with the Commission the annual reports,
quarterly reports and other documents which the Company would have been required
to file with the Commission pursuant to such Section 13(a) or 15(d) or any
successor provision thereto if the Company were so required, such documents to
be filed with the Commission on or prior to the respective dates (the "Required
Filing Dates") by which the Company would have been required so to file such
documents if the Company were so required. The Company shall also in any event
(a) within 15 days of each Required Filing Date (i) transmit by mail to all
Holders, as their names and addresses appear in the Note Register, without cost
to such Holders, and (ii) file with the Trustee, copies of the annual reports,
quarterly reports and other documents which the Company files with the
Commission pursuant to such Section 13(a) or 15(d) or any successor provisions
thereto or would have been required to file with the Commission pursuant to such
Section 13(a) or 15(d) or any successor provisions thereto if the Company were
required to comply with such Sections and (b) if filing such documents by the
Company with the Commission is not permitted by the Commission promptly upon
written request supply copies of such documents to any prospective Holder.
SECTION 10.17. Resale of Acquired Notes. The Company shall not, and
-------------------------
shall cause its Affiliates not to, resell or otherwise dispose of any Notes
acquired by them, whether pursuant to Section 10.14 or 10.15, in the open market
or otherwise, and shall, and shall cause its Affiliates to, surrender all such
Notes acquired to the Trustee for cancelation.
SECTION 10.18. Limitation on Issuances of Guaranties of Indebtedness
-----------------------------------------------------
by Subsidiaries. The Company will not permit any Subsidiary, directly or
----------------
indirectly, to Guaranty any Indebtedness unless such Subsidiary
110
simultaneously executes and delivers a Subsidiary Guaranty Supplemental
Indenture in the form attached hereto as Annex D, and in accordance with Article
IX hereof, providing for a Subsidiary Guaranty of the Notes.
SECTION 10.19. Limitation on Sale of Capital Stock of Subsidiaries.
----------------------------------------------------
The Company shall not, and shall not permit any Subsidiary to, issue, transfer,
convey, sell, lease or otherwise dispose of any shares of Capital Stock of or
other ownership interests in a Subsidiary, or options, warrants or other rights
to acquire, or securities convertible into or exchangeable for, such Capital
Stock or other ownership interests, to any Person (other than the Company or a
Wholly Owned Subsidiary) except in a transaction that consists of a transfer,
conveyance, sale, lease or other disposition of all the Capital Stock of and
other ownership interests in such Subsidiary owned by the Company or any
Subsidiary of the Company, and that is in accordance with the provisions of
Section 10.14, to the extent applicable; provided, however, that the pledging of
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shares of Capital Stock of any Subsidiary of the Company pursuant to the Bank
Facility shall not constitute such an issuance, transfer, conveyance, sale,
lease or other disposition.
SECTION 10.20. Limitation on Dispositions of Assets to Subsidiaries.
-----------------------------------------------------
The Company will not sell, convey, lease, transfer or otherwise contribute or
dispose of a substantial portion of its assets or property (including any
shares of Capital Stock of any Subsidiary of the Company (but excluding the
granting in the ordinary course of business of licenses to trademarks owned or
licensed by the Company) existing on the Issue Date (each referred to for the
purpose of this covenant as a "disposition") to any Subsidiary of the Company,
other than dispositions (a) made in the ordinary course of business, (b)
intercompany loans and cash equity contributions, including, without limitation,
any such loans or contributions for the purpose of effecting the payment of any
tax owed by any such Subsidiary to any governmental entity), (c) of trade or
other receivables and assets relating to trade and (d) permitted by Section
10.10.
Notwithstanding the foregoing, the Company may make a disposition of a
substantial portion of its assets or property existing on the Issue Date to any
Subsidiary of the Company, provided that such Subsidiary is a Subsidiary
--------
Guarantor.
SECTION 10.21. Statement by Officers as to Default; Compliance
-----------------------------------------------
Certificates. (a) The Company will deliver to the Trustee, within 90 days
-------------
after the end of each
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fiscal year of the Company ending after the date of this Indenture an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company or any Subsidiary Guarantor is in default in the performance and
observance of any of the terms, provisions and conditions of this Indenture
(without regard to any period of grace or requirement of notice provided
hereunder) and, if the Company or any Subsidiary Guarantor shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge.
(b) The Company shall deliver to the Trustee, as soon as possible and
in any event within 30 days after the Company becomes aware of the occurrence of
an Event of Default or an event which, with notice or the lapse of time or both,
would constitute an Event of Default, an Officers' Certificate setting forth the
details of such Event of Default or default, and the action which the Company
proposes to take with respect thereto.
SECTION 10.22. Waiver of Covenants. The Company and any Subsidiary
--------------------
Guarantor may omit in any particular instance to comply with any covenant or
condition set forth in Section 8.01 and Sections 10.04 through 10.21, inclusive,
if before the time for such compliance the Holders of at least a majority in
aggregate principal amount of the Outstanding Notes shall, by Act of such
Holders delivered in writing to the Company and the Trustee, either waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and each of the Subsidiary
Guarantors and the duties of the Trustee in respect of any such covenant or
condition shall remain in full force and effect; provided, however, with respect
-------- -------
to an Offer to Purchase as to which an Offer Document has been mailed, no such
waiver may be made or shall be effective against any Holder tendering Notes
pursuant to such Offer to Purchase, and the Company may not omit to comply with
the terms of such Offer Document as to such Holder, unless such Holder shall
have waived such requirement.
ARTICLE XI
Redemption of Notes
-------------------
SECTION 11.01. Redemption at the Election of the Company. Subject to
------------------------------------------
Article XIV and any Subsidiary Guaranty pursuant to an indenture supplemental
hereto in the form of Annex D, if any, the Notes may be redeemed at the election
112
of the Company, at the times and the Redemption Prices and subject to the
conditions and other requirements specified in the form of Notes hereinbefore
set forth.
SECTION 11.02. Applicability of Article. Redemption of Notes, either
-------------------------
at the election of the Company or mandatory, as permitted or required by any
provision of the Notes and this Indenture, shall be made in accordance with such
provision and the applicable provisions of this Article.
SECTION 11.03. Election to Redeem; Notice to Trustee. The election
--------------------------------------
of the Company to redeem any Note pursuant to Section 11.01 shall be evidenced
by a Board Resolution. In case of any redemption at the election of the Company
of less than all the Notes, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Notes to be redeemed. In addition, in case of any
redemption at the election of the Company pursuant to Section 11.01, the Company
shall, at least 60 days prior to the Redemption Date (unless a shorter notice
shall be satisfactory to the Trustee), furnish the Trustee with an Officers'
Certificate evidencing compliance with Section 11.01 (after giving effect to
such proposed redemption).
SECTION 11.04. Selection by Trustee of Notes to Be Redeemed. If less
---------------------------------------------
than all the Notes are to be redeemed, the particular Notes to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Notes not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate (and in a manner that complies
with applicable legal and securities exchange requirements, if any) and which
may provide for the selection for redemption of portions (equal to $1,000 or any
integral multiple thereof) of the principal amount of Notes of a denomination
larger than $1,000.
The Trustee shall promptly notify the Company and each Note Registrar
in writing of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
In the event that the Company is required to make an Offer to Purchase
pursuant to Sections 10.14 and 10.15 and the amount available for such Offer is
not an integral multiple of $1,000, the Trustee shall promptly refund to the
113
Company any remaining proceeds, which shall be less than $1,000.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Notes redeemed or to be redeemed only in part, to the portion of
the principal amount of such Notes which has been or is to be redeemed.
SECTION 11.05. Notice of Redemption. Notice of redemption shall be
---------------------
given by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date, to each Holder of Notes to be
redeemed, at his address appearing in the Note Register.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) a brief statement setting forth the Company's right to effect such
redemption and the Company's basis therefor;
(4) if less than all the Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption of any Notes, the
principal amounts) of the particular Notes to be redeemed;
(5) that on the Redemption Date the Redemption Price will become due
and payable upon each such Note to be redeemed and that interest thereon
will cease to accrue after said date;
(6) the place or places where such Notes are to be surrendered for
payment of the Redemption Price;
(7) that in the case that a Note is only redeemed in part, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
of such Note without service charge, a new Note or Notes in an aggregate
amount equal to the unredeemed portion of the Note;
(8) the aggregate principal amount of all Notes that will have been
redeemed pursuant to Section 11.02 through and including the Redemption
Date for which such notice is being given; and
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(9) the CUSIP number of the Notes that are being redeemed.
Notice of redemption of Notes to be redeemed pursuant to this Article
XI shall be given by the
Company; provided that notice of redemption shall be given by the Trustee in the
--------
name and at the expense of the Company where the Company has so requested.
The notice, if mailed in the manner herein provided, shall
conclusively be presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Note designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Note.
SECTION 11.06. Deposit of Redemption Price. In the case of
----------------------------
redemption pursuant to Section 11.01, on or prior to any Redemption Date, the
Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 10.03) an amount of money sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date)
accrued interest on, all the Notes which are to be redeemed on that date other
than Notes or portions thereof called for redemption on that date which have
been delivered by the Company to the Trustee for cancelation. Subject to any
applicable abandoned property laws, all money earned on funds held in trust by
the Trustee or any Paying Agent and any excess remaining funds shall be remitted
to the Company.
SECTION 11.07. Notes Payable on Redemption Date. Notice of
---------------------------------
redemption having been given as aforesaid, the Notes so to be redeemed shall, on
the Redemption Date, become due and payable at the Redemption Price therein
specified, and from and after such date (unless the Company shall default in the
payment of the Redemption Price and accrued interest) such Notes shall cease to
bear interest. Upon surrender of any such Notes for redemption in accordance
with said notice, such Notes shall be paid by the Company or Paying Agent, at
the Redemption Price, together with accrued interest to the Redemption Date;
provided, however, that installments of interest whose Stated Maturity is on or
-------- -------
prior to the Redemption Date shall be payable to the Holders of such Notes, or
one or more Predecessor Notes, registered as such at the close of business on
the relevant Regular Record Date according to their terms and the provisions of
Section 3.08.
115
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal of (and premium, if any) and interest on
such Note shall be deemed overdue and shall, until paid, bear interest from the
Redemption Date at the rate provided by such Note.
SECTION 11.08. Notes Redeemed in Part. Any Note which is to be
-----------------------
redeemed only in part shall be surrendered at an office or agency of the Company
designated for that purpose pursuant to Section 10.02 (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Note without service charge, a new Note or Notes, of any authorized denomination
as requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Note so surrendered.
ARTICLE XII
Defeasance and Covenant Defeasance
----------------------------------
SECTION 12.01. Company's Option to Effect Defeasance or Covenant
-------------------------------------------------
Defeasance. The Company may at its option by Board Resolution, and at any time,
-----------
elect to have either Section 12.02 or Section 12.03 applied to the Outstanding
Notes upon compliance with the conditions set forth below in this Article XII.
SECTION 12.02. Defeasance and Discharge. Upon the Company's exercise
-------------------------
of the option provided in Section 12.01 applicable to this Section, the Company
shall be deemed to have been discharged from its obligations with respect to the
Outstanding Notes and the provisions of Article XIV and any Subsidiary Guaranty
pursuant to an indenture supplemental hereto in the form of Annex D, if any,
shall cease to be effective, on and after the date the conditions set forth
below are satisfied (hereinafter, "defeasance"). For this purpose, such
defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by the Outstanding Notes and to have
satisfied all its other obligations under such Notes and this Indenture insofar
as such Notes are concerned (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of such Notes to receive, solely from the
trust fund described in
116
Section 12.04 and as more fully set forth in such Section, payments in respect
of the principal of (and premium, if any) and interest on such Notes when such
payments are due, (B) the Company's obligations with respect to such Notes under
Sections 3.04, 3.05, 3.06, 3.07, 10.02 and 10.03, (C) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and (D) this Article XII.
Subject to compliance with this Article XII, the Company may exercise its option
under this Section 12.02 notwithstanding the prior exercise of its option under
Section 12.03.
SECTION 12.03. Covenant Defeasance. Upon the Company's exercise of
--------------------
the option provided in Section 12.01 applicable to this Section, (i) the Company
shall be released from its obligations under Sections 10.05 through 10.20
inclusive, and Clause (iii) of Section 8.01, (ii) the occurrence of an event
specified in Section 5.01(c) (with respect to Section 8.01, only Clause (iii)
thereof), 501(d) (with respect to any of Sections 10.05 through 10.20,
inclusive), 5.01(e) and 5.01(f) shall not be deemed to be an Event of Default
and (iii) the provisions of Article XIV hereof and any Subsidiary Guaranty
pursuant to an indenture supplemental hereto in the form of Annex D, if any,
shall cease to be effective on and after the date the conditions set forth below
are satisfied (hereinafter, "covenant defeasance"). For this purpose, such
covenant defeasance means that the Company may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in
any such Section, Clause or Article, whether directly or indirectly by reason of
any reference elsewhere herein to any such Section, Clause or Article or by
reason of any reference in any such Section, Clause or Article to any other
provision herein or in any other document; but the remainder of this Indenture
and such Notes shall be unaffected thereby.
SECTION 12.04. Conditions to Defeasance or Covenant Defeasance. The
-----------------------------------------------
following shall be the conditions to application of either Section 12.02 or
Section 12.03 to the then Outstanding Notes:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 6.09 who shall agree to comply with the provisions of this Article XII
applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of the Notes, (A) cash in U.S. dollars, (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
117
later than one day before the due date of any payment or (C) a combination
thereof, in an amount sufficient in the opinion of a nationally recognized firm
of independent public accountants expressed in a written opinion with respect
thereto delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee (or other qualifying trustee) to pay and discharge, the
principal of (premium, if any) and each installment of interest on the Notes on
the Stated Maturity of such principal or installment of interest in accordance
with the terms of this Indenture and of such Notes.
(2) In the case of an election under Section 12.02, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (x) the Company
has received from, or there has been published by, the Internal Revenue Service
a ruling, or (y) since the date of this Indenture there has been a change in the
applicable Federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the Outstanding Notes
will not recognize gain or loss for Federal income tax purposes as a result of
such deposit, defeasance and discharge and will be subject to Federal income tax
on the same amount, in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge had not occurred.
(3) In the case of an election under Section 12.03, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the Outstanding Notes will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and covenant defeasance
and will be subject to Federal income tax on the same amount, in the same manner
and at the same times as would have been the case if such deposit and covenant
defeasance had not occurred.
(4) At the time of such deposit: (A) no default in the payment of
all or a portion of principal of (or premium, if any) or interest on any Senior
Indebtedness of the Company shall have occurred and be continuing, and no event
of default with respect to any Senior Indebtedness of the Company shall have
occurred and be continuing and shall have resulted in such Senior Indebtedness
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable and (B) no other event of default with
respect to any Senior Indebtedness of the Company shall have occurred and be
continuing permitting (after notice or the lapse of time, or both) the holders
of such Senior Indebtedness (or a trustee on behalf of the holders thereof) to
declare such Senior Indebtedness due and payable prior to the date on which it
would otherwise have
118
become due and payable, or, in the case of either Clause (A) or Clause (B)
above, each such default or event of default shall have been cured or waived or
shall have ceased to exist.
(5) No Event of Default or event which with notice or lapse of time
or both would become an Event of Default shall have occurred and be continuing
on the date of such deposit or, insofar as subsections 5.01(g) and (h) are
concerned, at any time during the period ending on the 91st day after the date
of such deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(6) Such defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest within the meaning of the Trust Indenture
Act (assuming all Notes are in default within the meaning of such Act).
(7) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, any other material
agreement or instrument to which the Company is a party or by which it is bound.
(8) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section 12.02 or
the covenant defeasance under Section 12.03 (as the case may be) have been
complied with.
(9) Such defeasance or covenant defeasance shall not result in the
trust arising from such deposit constituting an investment company as defined in
the Investment Company Act of 1940, as amended from time to time, or such trust
shall be qualified under such act or exempt from regulation thereunder.
SECTION 12.05. Deposited U.S. Government Obligations to be Held in
---------------------------------------------------
Trust; Other Miscellaneous Provisions. Subject to the provisions of the last
--------------------------------------
paragraph of Section 10.03, all money and U.S. Government Obligations (including
the proceeds thereof) deposited with the Trustee (or other qualifying trustee--
collectively, for purposes of this Section 12.05, the "Trustee") pursuant to
Section 12.04 in respect of the Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Notes and this Indenture, to
the payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Notes, of all sums due and to become due thereon in respect of principal
(and premium, if any) and
119
interest, but such money need not be segregated from other funds except to the
extent required by law. Money so held in trust shall not be subject to the
provisions of Article XIV or any Subsidiary Guaranty pursuant to an indenture
supplemental hereto in the form of Annex D, if any.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 12.04 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the Outstanding Notes.
Anything in this Article XII to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request and be relieved of all liability with respect to any money or U.S.
Government Obligations held by it as provided in Section 12.04 which, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written opinion with respect thereto delivered to the Trustee,
are in excess of the amount thereof which would then be required to be deposited
to effect an equivalent defeasance or covenant defeasance.
SECTION 12.06. Reinstatement. If the Trustee or the Paying Agent is
-------------
unable to apply any money in accordance with Section 12.02 or 12.03 by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to this Article Twelve until such
time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 12.02 or 12.03; provided, however, that if the Company
-------- -------
makes any payment of principal of (and premium, if any) or interest on any Notes
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Notes to receive such payment from the
money held by the Trustee or the Paying Agent.
ARTICLE XIII
[Article Intentionally Left Blank]
120
ARTICLE XIV
Subordination of Notes
----------------------
SECTION 14.01. Notes Subordinate to Senior Indebtedness. The Company
-----------------------------------------
covenants and agrees, and each Holder of a Note, by his acceptance thereof,
likewise covenants and agrees, that, to the extent and in the manner hereinafter
set forth in this Article (subject to the provisions of Article IV and Article
XII and Section 11.01), the payment of the principal of (and premium, if any)
and interest on the Notes and any other Obligations in respect of the Notes
(including any obligation to repurchase Notes) are hereby expressly made
subordinate and subject in right of payment to the prior payment in full in cash
or Cash Equivalents of all Senior Indebtedness of the Company.
SECTION 14.02. Payment Over of Proceeds Upon Dissolution, Etc. Upon
-----------------------------------------------
any payment or distribution of assets of the Company to creditors upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshaling of assets and liabilities or any bankruptcy, insolvency
or similar proceedings of the Company, the holders of Senior Indebtedness of the
Company will be entitled to receive payment in full of all principal, premium
(if any), interest, penalties, reimbursement or indemnity amounts, fees and
expenses in respect of such Senior Indebtedness (including, as provided below,
any post-petition interest, whether or not an allowed claim) including all
amount due or to become due on all such Senior Indebtedness, or provision will
be made for payment in cash or Cash Equivalents or otherwise in a manner
satisfactory to the holders of such Senior Indebtedness, before the Holders of
the Notes are entitled to receive any Notes Payments other than payments in
Permitted Junior Securities.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Note shall have received any Notes
Payment before all Senior Indebtedness of the Company is paid in full or payment
thereof provided for in cash or Cash Equivalents or otherwise in a manner
satisfactory to the holders of such Senior Indebtedness, then and in such event
such Notes Payment shall be paid over or delivered forthwith to the holders of
Senior Indebtedness for application to the payment of such Senior Indebtedness
remaining unpaid, to the extent necessary to pay such Senior Indebtedness in
full, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Indebtedness.
121
The consolidation of the Company with, or the merger of the Company
into, another Person or the liquidation or dissolution of the Company following
the conveyance or transfer of all or substantially all of its properties and
assets as an entirety to another Person upon the terms and conditions set forth
in Article VIII shall not be deemed to fall within this Section if the Person
formed by such consolidation or into which the Company is merged or the Person
which acquires by conveyance or transfer such properties and assets as an
entirety, as the case may be, shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions set forth in Article VIII.
SECTION 14.03. No Payment When Senior Indebtedness in Default. In
-----------------------------------------------
the event that any Senior Payment Default (as defined below) shall have occurred
and be continuing, then no Notes Payment shall be made by the Company (other
than payments in Permitted Junior Securities) unless and until such Senior
Payment Default shall have been cured or waived or shall have ceased to exist or
all amounts then due and payable in respect of such Senior Indebtedness of the
Company to which such Senior Payment Default relates shall have been paid in
full, or provision shall have been made for such payment in cash or otherwise in
a manner satisfactory to the holders of such Senior Indebtedness. "Senior
Payment Default" means (i) any default in the payment of principal of (or
premium, if any) or interest on any Senior Indebtedness of the Company and (ii)
any event of default with respect to Senior Indebtedness of the Company which
has resulted in such Senior Indebtedness becoming or being declared due and
payable prior to the date on which it would otherwise have become due and
payable.
In the event that any Senior Nonmonetary Default (as defined below)
shall have occurred and be continuing, then, upon the receipt by the Company and
the Trustee of written notice of such Senior Nonmonetary Default from the
representative of the Designated Senior Indebtedness (the "Representatives"), no
Notes Payment shall be made (other than payments in Permitted Junior Securities)
during the period (the "blockage period") commencing on the date of such receipt
of such written notice and ending on the earlier of (i) 179 days after such date
and (ii) the date, if any, on which the Senior Indebtedness of the Company to
which such default relates is discharged or such default is waived or otherwise
cured. No more than one blockage period may be commenced with respect to the
Notes during any consecutive 360-day period. For all purposes of this
paragraph, no Senior Nonmonetary Default that existed or was continuing on the
date of commencement of any blockage period with respect to the Senior
Indebtedness of the
122
Company shall be, or be made, the basis for the commencement of a subsequent
blockage period whether or not within a period of 360 consecutive days by
holders of Senior Indebtedness of the Company or their representatives unless
such default shall have been cured for a period of not less than 90 consecutive
days. "Senior Nonmonetary Default" means the occurrence or existence and
continuance of any event of default, or of any event which, after notice or
lapse of time (or both), would become an event of default, under the terms of
any instrument pursuant to which any Designated Senior Indebtedness of the
Company is outstanding, permitting (after notice or lapse of time or both) one
or more holders of such Senior Indebtedness (or a trustee or agent on behalf of
the holders thereof) to declare such Senior Indebtedness due and payable prior
to the date on which it would otherwise become due and payable, other than a
Senior Payment Default.
In the event that, notwithstanding the foregoing, the Company shall
make any Notes Payment (other than Permitted Junior Securities), as the case may
be, to the Trustee or any Holder prohibited by the foregoing provisions of this
Section, then and in such event such Notes Payment shall be paid over and
delivered forthwith to the holders of the Senior Indebtedness of the Company.
The provisions of this Section shall not apply to any Notes Payment
with respect to which Section 14.02 would be applicable.
SECTION 14.04. Certain Payments Permitted. Nothing contained in this
---------------------------
Article or elsewhere in this Indenture or in any of the Notes shall prevent the
Company, at any time except during the pendency of any proceeding referred to in
Section 14.02 or under the conditions described in Section 14.03, from making
Notes Payments.
SECTION 14.05. Subrogation to Rights of Holders of Senior
------------------------------------------
Indebtedness. Subject to the payment in full in cash of all amounts due or to
-------------
become due on or in respect of Senior Indebtedness of the Company, or the
provision for such payment in cash or Cash Equivalents or otherwise in a manner
satisfactory to the holders of such Senior Indebtedness, the Holders of the
Notes shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to such Senior Indebtedness until the principal of (and
premium, if any) and interest on the Notes shall be paid in full. For purposes
of such subrogation, no payments or distributions to the holders of the Senior
Indebtedness of the Company of any cash, property or securities to which the
Holders of the Notes or the Trustee
123
would be entitled except for the provisions of this Article, and no payments
over pursuant to the provisions of this Article to the holders of Senior
Indebtedness of the Company by Holders of the Notes or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Indebtedness and
the Holders of the Notes, be deemed to be a payment or distribution by the
Company to or on account of the Senior Indebtedness of the Company.
SECTION 14.06. Provisions Solely to Define Relative Rights. The
--------------------------------------------
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders on the one hand and the holders of
Senior Indebtedness on the other hand. Nothing contained in this Article or
elsewhere in this Indenture or in the Notes is intended to or shall (a) impair,
as among the Company, its creditors other than holders of Senior Indebtedness
and the Holders of the Notes, the obligation of the Company, which is absolute
and unconditional (and which, subject to the rights under this Article of the
holders of Senior Indebtedness, is intended to rank equally with all other
general obligations of the Company), to pay to the Holders of the Notes the
principal of (and premium, if any) and interest on the Notes as and when the
same shall become due and payable in accordance with their terms; or (b) affect
the relative rights against the Company of the Holders of the Notes and
creditors of the Company other than the holders of Senior Indebtedness; or (c)
prevent the Trustee or the Holder of any Note from exercising all remedies
otherwise permitted by applicable law upon any default under this Indenture,
subject to the rights, if any, under this Article of the holders of Senior
Indebtedness to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
SECTION 14.07. Trustee to Effectuate Subordination. Each Holder of a
------------------------------------
Note by his acceptance thereof authorizes and directs the Trustee on his behalf
to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee his attorney-in-
fact for any and all such purposes.
SECTION 14.08. No Waiver of Subordination Provisions. No right of
--------------------------------------
any present or future holder of any Senior Indebtedness to enforce subordination
as herein provided shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or by any act or failure to
act, in good faith, by any such holder, or by any noncompliance by the Company
with the terms, provisions and covenants of this Indenture,
124
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the Notes,
without incurring responsibility to the Holders of the Notes and without
impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Holders of the Notes to the holders of Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter or
increase, Senior Indebtedness, or otherwise amend or supplement in any manner
Senior Indebtedness or any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any Person liable in any manner for the collection
of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights
against the Company and any other Person.
SECTION 14.09. Notice to Trustee. The Company shall give prompt
------------------
written notice to the Trustee of any fact known to the Company which would
prohibit the making of any payment to or by the Trustee in respect of the Notes.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Notes, unless and until the Trustee shall have received written
notice thereof from the Company or a holder of Senior Indebtedness or from any
trustee therefor; and, prior to the receipt of any such written notice, the
Trustee, subject to the provisions of Section 6.01, shall be entitled in all
respects to assume that no such facts exist; provided that nothing in this
--------
Section 14.09 shall impair the subordination provisions of this Article XIV.
Subject to the provisions of Section 6.01, the Trustee shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness (or a trustee,
representative or agent therefor) to establish that such notice has been given
by a holder of Senior Indebtedness (or a trustee, representative or agent
therefor). In the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or
125
distribution pursuant to this Article, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
SECTION 14.10. Reliance on Judicial Order or Certificate of
--------------------------------------------
Liquidating Agent. Upon any payment or distribution of assets or securities of
------------------
the Company referred to in this Article, the Trustee, subject to the provisions
of Section 6.01, and the Holders of the Notes shall be entitled to rely upon any
order or decree entered by any court of competent jurisdiction in which such
proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Notes, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
SECTION 14.11. Trustee Not Fiduciary for Holders of Senior
-------------------------------------------
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
-------------
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall in good faith mistakenly pay over or distribute to Holders of Notes or to
the Company or to any other Person cash, property or securities to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article or
otherwise.
SECTION 14.12. Rights of Trustee as Holder of Senior Indebtedness;
---------------------------------------------------
Preservation of Trustee's Rights. The Trustee in its individual capacity shall
---------------------------------
be entitled to all the rights set forth in this Article with respect to any
Senior Indebtedness which may at any time be held by it, to the same extent as
any other holder of Senior Indebtedness, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.07.
126
SECTION 14.13. Article Applicable to Paying Agents. In case at any
------------------------------------
time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for all
intents and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee; provided, however, that Section 14.12
-------- -------
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as Paying Agent.
SECTION 14.14. Defeasance of this Article Fourteen. The
------------------------------------
subordination of the Notes provided by this Article XIV is expressly made
subject to the provisions for defeasance or covenant defeasance in Articles IV
and XII and, anything herein to the contrary notwithstanding, upon the
effectiveness of any such defeasance or covenant defeasance, the Notes then
outstanding shall thereupon cease to be subordinated pursuant to this Article
XIV.
ARTICLE XV
Jurisdiction and Consent to Service of Process
----------------------------------------------
SECTION 15.01. Jurisdiction and Consent to Service of Process. (a)
-----------------------------------------------
The Company hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to the Notes, this Indenture or for recognition or enforcement of any
judgment, and the Company hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York State or, to the extent permitted by law, in such Federal
court. The Company agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Article XV shall affect any right that any Holder or the Trustee may otherwise
have to bring any action or proceeding relating to the Notes or this Indenture
against the Company or its properties in the courts of any jurisdiction.
(b) The Company hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or
127
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to the Notes or this Indenture in any New York State or
Federal court. The Company hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.
(c) The Company irrevocably consents to service of process in the
manner provided for notices in Section 1.05. Nothing in this Agreement will
affect the right of any Holder or the Trustee to serve process in any other
manner permitted by law.
------------------------
This instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
128
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the day and year first above written.
AFC ENTERPRISES, INC.
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Vice
President, General
Counsel and
Secretary
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Vice
President
ANNEX A -- Form of
Regulation S Certificate
REGULATION S CERTIFICATE
(For transfers pursuant to (S) 3.06(b)(i), (iii) and (v)
of the Indenture)
United States Trust Company of
New York
[Address]
Re: 10-1/4% Senior Subordinated Notes
due 2007 of AFC Enterprises, Inc.
(the "Notes")
---------------------------------
Reference is made to the Indenture, dated as of May 21, 1997 (the
"Indenture"), from AFC Enterprises, Inc. (the "Company"), to United States Trust
Company of New York, as Trustee. Terms used herein and defined in the Indenture
or in Regulation S or Rule 144 under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), are used herein as so defined.
This certificate relates to U.S. $______________________ principal amount
of Notes, which are evidenced by the following certificate(s) (the "Specified
Notes"):
CUSIP No(s). _____________________________
CERTIFICATE No(s). _______________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Notes or (ii) it is acting on behalf of all the beneficial owners of
the Specified Notes and is duly authorized by them to do so. Such beneficial
owner or owners are referred to herein collectively as the "Owner". If the
Specified Notes are represented by a Global Note, they are held through the
Depositary or an Agent Member in the name of the Undersigned, as or on behalf of
the Owner. If the Specified Notes are not represented by a Global Note, they
are registered in the name of the Undersigned, as or on behalf of the Owner.
A-1
The Owner has requested that the Specified Notes be transferred to a Person
(the "Transferee") who will take delivery in the form of a Regulation S Note.
In connection with such transfer, the Owner hereby certifies that, unless such
transfer is being effected pursuant to an effective registration statement under
the Securities Act, it is being effected in accordance with Rule 904 or Rule 144
under the Securities Act and with all applicable securities laws of the states
of the United States and other jurisdictions. Accordingly, the Owner hereby
further certifies as follows:
(1) Rule 904 Transfers. If the transfer is being effected in
------------------
accordance with Rule 904:
(A) the owner is not a distributor of the Notes, an affiliate of
the Company or any such distributor or a person acting on behalf of
any of the foregoing;
(B) the offer of the Specified Notes was not made to a person in
the United States;
(C) either:
(i) at the time the buy order was originated, the Transferee
was outside the United States or the Owner and any person acting
on its behalf reasonably believed that the Transferee was outside
the United States, or
(ii) the transaction is being executed in, on or through the
facilities of, the Eurobond market, as regulated by the
Association of International Bond Dealers, or another designated
offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts have been made in the United
States by or on behalf of the Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities or has received a
selling concession, fee or other remuneration in respect of the
Specified Notes, and the transfer is to occur during the Restricted
Period, then the requirements of Rule 904(c)(1) have been satisfied;
and
A-2
(F) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
(2) Rule 144 If the transfer is being effected pursuant to Rule 144:
--------
(A) the transfer is occurring after a holding period of at least
one year (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Notes were last acquired from the Company
or from an affiliate of the Company, whichever is later, and is being
effected in accordance with the applicable amount, manner of sale and
notice requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at least
two years has elapsed since the Specified Notes were last acquired
from the Company or from an affiliate of the Company, whichever is
later, and the Owner is not, and during the preceding three months has
not been, an affiliate of the Company.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated: ____________________________________________________________
(Print the name of the Undersigned, as such term is defined
in the second paragraph of this certificate.)
By:
----------------------------------------------------------
Name:
Title:
(If the Undersigned is a corporation, partnership or
fiduciary, the title of the person signing on behalf of the
Undersigned must be stated.)
A-3
ANNEX B -- Form of Restricted
Notes Certificate
RESTRICTED NOTES CERTIFICATE
(For transfers pursuant to (S) 3.06(b)(ii), (iii), (iv) and (v) of the
Indenture)
United States Trust Company of New York
[Address]
Re: 10-1/4% Senior Subordinated Notes
due 2007 of AFC Enterprises, Inc.
(the "Notes")
---------------------------------
Reference is made to the Indenture, dated as of May 21, 1997 (the
"Indenture"), from AFC Enterprises, Inc. (the "Company") to United States Trust
Company of New York, as Trustee. Terms used herein and defined in the Indenture
or in Rule 144A or Rule 144 under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), are used herein as so defined.
This certificate relates to U.S. $_________________ principal amount of
Notes, which are evidenced by the following certificates) (the "Specified
Notes"):
CUSIP No(s). ____________________________
ISIN No(s), If any. _____________________
CERTIFICATE No(s). ______________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Notes or (ii) it is acting on behalf of all the beneficial owners of
the Specified Notes and is duly authorized by them to do so. Such beneficial
owner or owners are referred to herein collectively as the "Owner". If the
Specified Notes are represented by a Global Note, they are held through the
Depositary or an Agent Member in the name of the Undersigned, as or on behalf of
the Owner. If the Specified Notes are not represented by a Global Notes, they
are registered in the name of the Undersigned, as or on behalf of the Owner.
B-1
The Owner has requested that the Specified Notes be transferred to a Person
(the "Transferee") who will take delivery in the form of a Restricted Note. In
connection with such transfer, the owner hereby certifies that, unless such
transfer is being effected pursuant to an effective registration statement under
the Securities Act, it is being effected in accordance with Rule 144A or Rule
144 under the Securities Act and all applicable securities laws of the states of
the United States and other jurisdictions. Accordingly, the owner hereby
further certifies as:
(1) Rule 144A Transfers. If the transfer is being effected in
--------------------
accordance with Rule 144A:
(A) the Specified Notes are being transferred to a person that
the Owner and any person acting on its behalf reasonably believe is
a "qualified institutional buyer" within the meaning of Rule 144A,
acquiring for its own account or for the account of a qualified
institutional buyer; and
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the
Owner may be relying on Rule 144A in connection with the transfer;
and
(2) Rule 144 Transfers. If the transfer is being effected pursuant
------------------
to Rule 144:
(A) the transfer is occurring after a holding period of at least
one year (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Notes were last acquired from the
Company or from an affiliate of the Company, whichever is later, and
is being effected in accordance with the applicable amount, manner
of sale and notice requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at least
two years has elapsed since the Specified Notes were last acquired
from the Company or from an affiliate of the Company, whichever is
later, and the Owner is not, and during the preceding three months
has not been, an affiliate of the Company.
B-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated: _________________________________________________
(Print the name of the Undersigned, as such term
is defined in the second paragraph of this
certificate.)
By:
-----------------------------------------------
Name:
Title:
(If the Undersigned is a corporation, partnership
or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)
B-3
ANNEX C -- Form of Unrestricted
Notes Certificate
[UNRESTRICTED NOTES CERTIFICATE]
(For removal of Securities Act Legends pursuant to (S) 306(c))
United States Trust Company of New York
[Address]
Re: 10-1/4% Senior Subordinated Notes
due 2007 of AFC Enterprises, Inc.
(the "Notes")
---------------------------------
Reference is made to the Indenture, dated as of May 21, 1997 (the
"Indenture"), from AFC Enterprises, Inc. (the "Company"), to United States Trust
Company of New York, as Trustee. Terms used herein and defined in the Indenture
or in Rule 144 under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), are used herein as so defined.
This certificate relates to U.S. $_________________ principal amount of
Notes, which are evidenced by the following certificates) (the "Specified
Notes"):
CUSIP No(s). ___________________________
CERTIFICATE No(s).______________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Notes or (ii) it is acting on behalf of all the beneficial owners of
the Specified Notes and is duly authorized by them to do so. Such beneficial
owner or owners are referred to herein collectively as the "Owner". If the
Specified Notes are represented by a Global Note, they are held through the
Depositary or an Agent Member in the name of the Undersigned, as or on behalf of
the Owner. If the Specified Notes are not represented by a Global Note, they are
registered in the name of the Undersigned, as or on behalf of the Owner.
The Owner has requested that the Specified Notes be exchanged for Notes
bearing no Securities Act Legend pursuant to Section 3.06(c) of the Indenture.
In connection with such exchange, the Owner hereby certifies that the exchange
is occurring after a holding period of at least two
years (computed in accordance with paragraph (d) of Rule 144) has elapsed since
the Specified Notes were last acquired from the Company or from an affiliate of
the Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company. The Owner also
acknowledges that any future transfers of the Specified Notes must comply with
all applicable securities laws of the states of the United States and other
jurisdictions.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated: __________________________________________________________
(Print the name of the Undersigned, as such term is
defined in the second paragraph of this certificate.)
By:
--------------------------------------------------------
Name:
Title:
(If the Undersigned is a corporation, partnership or
fiduciary, the title of the person signing on behalf of
the Undersigned must be stated.)
TABLE OF CONTENTS
Page
----
RECITALS OF THE COMPANY
ARTICLE I Definitions and Other Provisions of General
-------------------------------------------
Application
-----------
SECTION 1.01. Definitions................................ 2
-----------
SECTION 1.02. Compliance Certificates and Opinions....... 30
------------------------------------
SECTION 1.03. Form of Documents Delivered to Trustee..... 31
--------------------------------------
SECTION 1.04. Acts of Holders; Record Dates.............. 32
-----------------------------
SECTION 1.05. Notices, etc., to Trustee and Company...... 35
-------------------------------------
SECTION 1.06. Notice to Holders; Waiver.................. 35
-------------------------
SECTION 1.07. Conflict with Trust Indenture Act.......... 36
---------------------------------
SECTION 1.08. Effect of Headings and Table of Contents... 36
----------------------------------------
SECTION 1.09. Successors and Assigns..................... 37
----------------------
SECTION 1.10. Separability Clause........................ 37
-------------------
SECTION 1.11. Benefits of Indenture...................... 37
---------------------
SECTION 1.12. GOVERNING LAW.............................. 37
-------------
SECTION 1.13. Legal Holidays............................. 37
--------------
SECTION 1.14. No Recourse Against Others................. 37
--------------------------
ARTICLE II Notes Forms
-----------
SECTION 2.01. Forms Generally; Initial Forms of
---------------------------------
Rule 144A and Regulation S Notes........... 37
--------------------------------
SECTION 2.02. Form of Face of Notes...................... 38
---------------------
SECTION 2.03. Form of Reverse of Notes................... 42
------------------------
SECTION 2.04. Form of Trustee's Certificate of
--------------------------------
Authentication............................. 48
--------------
ARTICLE III The Notes
---------
SECTION 3.01. Title and Terms............................ 49
---------------
SECTION 3.02. Denominations.............................. 52
-------------
SECTION 3.03. Execution, Authentication, Delivery
-----------------------------------
and Dating................................. 52
----------
SECTION 3.04. Temporary Notes............................ 53
---------------
SECTION 3.05. Global Notes............................... 54
------------
SECTION 3.06. Registration, Registration of
-----------------------------
Transfer and Exchange Generally;
--------------------------------
Restrictions on Transfer and
----------------------------
Exchange; Securities Act Legends........... 55
--------------------------------
SECTION 3.07. Mutilated, Destroyed, Lost and
------------------------------
Stolen Notes............................... 61
------------
i
Page
----
SECTION 3.08. Payment of Interest; Interest Rights
------------------------------------
Preserved.................................. 62
---------
SECTION 3.09. Persons Deemed Owners...................... 64
---------------------
SECTION 3.10. Cancelation................................ 64
-----------
SECTION 3.11. Computation of Interest.................... 65
-----------------------
SECTION 3.12. CUSIP Number............................... 65
------------
ARTICLE IV Satisfaction and Discharge
--------------------------
SECTION 4.01. Satisfaction and Discharge of Indenture.... 65
---------------------------------------
SECTION 4.02. Application of Trust Money................. 66
--------------------------
ARTICLE V Remedies
--------
SECTION 5.01. Events of Default.......................... 67
-----------------
SECTION 5.02. Acceleration of Maturity; Rescission
------------------------------------
and Annulment.............................. 69
-------------
SECTION 5.03. Collection of Indebtedness and Suits
------------------------------------
for Enforcement by Trustee................. 71
--------------------------
SECTION 5.04. Trustee May File Proofs of Claim........... 71
--------------------------------
SECTION 5.05. Trustee May Enforce Claims Without
----------------------------------
Possession of Notes........................ 72
-------------------
SECTION 5.06. Application of Money Collected............. 72
------------------------------
SECTION 5.07. Limitation on Suits........................ 73
-------------------
SECTION 5.08. Unconditional Right of Holders To
---------------------------------
Receive Principal, Premium and Interest.... 73
---------------------------------------
SECTION 5.09. Restoration of Rights and Remedies......... 74
----------------------------------
SECTION 5.10. Rights and Remedies Cumulative............. 74
------------------------------
SECTION 5.11. Delay or Omission Not Waiver............... 74
----------------------------
SECTION 5.12. Control by Holders......................... 74
------------------
SECTION 5.13. Waiver of Defaults......................... 75
------------------
SECTION 5.14. Undertaking for Costs...................... 75
---------------------
SECTION 5.15. Waiver of Stay, Usury or Extension Laws.... 76
---------------------------------------
ARTICLE VI The Trustee
-----------
SECTION 6.01. Certain Duties and Responsibilities........ 76
-----------------------------------
SECTION 6.02. Notice of Defaults......................... 76
------------------
SECTION 6.03. Certain Rights of Trustee.................. 77
-------------------------
SECTION 6.04. Not Responsible for Recitals or Issuance
----------------------------------------
of Notes................................... 78
--------
SECTION 6.05. May Hold Notes............................. 78
--------------
SECTION 6.06. [Section Intentionally Left Blank]......... 78
----------------------------------
SECTION 6.07. Compensation and Reimbursement............. 78
------------------------------
SECTION 6.08. Disqualification; Conflicting Interests.... 79
---------------------------------------
SECTION 6.09. Corporate Trustee Required; Eligibility.... 79
---------------------------------------
SECTION 6.10. Resignation and Removal; Appointment
------------------------------------
ii
Page
----
of Successor............................... 80
------------
SECTION 6.11. Acceptance of Appointment by Successor..... 81
--------------------------------------
SECTION 6.12. Merger, Conversion, Consolidation or
------------------------------------
Succession to Business..................... 82
----------------------
SECTION 6.13. Preferential Collection of Claims
---------------------------------
Against Company............................ 82
---------------
SECTION 6.14. Appointment of Authenticating Agent........ 82
-----------------------------------
ARTICLE VII Holders' Lists and Reports by
-----------------------------
Trustee and Company
-------------------
SECTION 7.01. Company to Furnish Trustee Names and
------------------------------------
Addresses of Holders....................... 84
--------------------
SECTION 7.02. Preservation of Information;
----------------------------
Communications to Holders.................. 84
-------------------------
SECTION 7.03. Reports by Trustee......................... 85
------------------
SECTION 7.04. Reports by Company and Subsidiary
---------------------------------
Guarantors................................. 85
----------
SECTION 7.05. Officers' Certificate with Respect to
-------------------------------------
Change in Interest Rates................... 85
------------------------
ARTICLE VIII Merger, Consolidation, etc.
---------------------------
SECTION 8.01. Consolidation, Merger and Sale of Assets... 86
----------------------------------------
SECTION 8.02. Successor Substituted...................... 87
---------------------
ARTICLE IX Supplemental Indentures
-----------------------
SECTION 9.01. Supplemental Indentures Without Consent
---------------------------------------
of Holders................................. 87
----------
SECTION 9.02. Supplemental Indentures with Consent
------------------------------------
of Holders................................. 88
----------
SECTION 9.03. Execution of Supplemental Indentures....... 89
------------------------------------
SECTION 9.04. Effect of Supplemental Indentures.......... 90
---------------------------------
SECTION 9.05. Conformity with Trust Indenture Act........ 90
-----------------------------------
SECTION 9.06. Reference in Notes to Supplemental
----------------------------------
Indentures................................. 90
----------
SECTION 9.07. Execution of Supplemental Indentures
------------------------------------
for Subsidiary Guaranties.................. 90
-------------------------
SECTION 9.08. Revocation and Effect of Consents of
------------------------------------
Holders.................................... 90
-------
ARTICLE X Covenants
---------
SECTION 10.01. Payment of Principal, Premium and
---------------------------------
Interest................................... 91
--------
SECTION 10.02. Maintenance of Office or Agency............ 91
-------------------------------
iii
Page
----
SECTION 10.03. Money for Notes Payments To Be Held
-----------------------------------
in Trust................................... 92
--------
SECTION 10.04. Existence.................................. 93
---------
SECTION 10.05. Maintenance of Properties.................. 93
-------------------------
SECTION 10.06. Payment of Taxes and Other Claims.......... 94
---------------------------------
SECTION 10.07. Maintenance of Insurance................... 94
------------------------
SECTION 10.08. Limitation on Indebtedness and
------------------------------
Subsidiary Preferred Stock................. 94
--------------------------
SECTION 10.09. Limitation on Senior Subordinated
---------------------------------
Indebtedness............................... 97
------------
SECTION 10.10. Limitation on Restricted Payments.......... 97
---------------------------------
SECTION 10.11. Limitations Concerning Distributions
------------------------------------
by Subsidiaries............................ 01
---------------
SECTION 10.12. Limitation on Certain Liens................ 02
---------------------------
SECTION 10.13. Limitation on Transactions with
-------------------------------
Affiliates................................. 02
----------
SECTION 10.14. Limitation on Asset Dispositions........... 04
--------------------------------
SECTION 10.15. Offer to Purchase Upon Change of
--------------------------------
Control.................................... 07
-------
SECTION 10.16. Provision of Financial Information......... 08
----------------------------------
SECTION 10.17. Resale of Acquired Notes................... 09
------------------------
SECTION 10.18. Limitation on Issuances of Guaranties
-------------------------------------
of Indebtedness by Subsidiaries............ 09
-------------------------------
SECTION 10.19. Limitation on Sale of Capital Stock of
--------------------------------------
Subsidiaries............................... 10
------------
SECTION 10.20. Limitation on Dispositions of Assets
------------------------------------
to Subsidiaries............................ 10
---------------
SECTION 10.21. Statement by Officers as to Default;
------------------------------------
Compliance Certificates.................... 10
-----------------------
SECTION 10.22. Waiver of Covenants........................ 11
-------------------
ARTICLE XI Redemption of Notes
-------------------
SECTION 11.01. Redemption at the Election of the
---------------------------------
Company.................................... 111
-------
SECTION 11.02. Applicability of Article................... 112
------------------------
SECTION 11.03. Election to Redeem; Notice to Trustee...... 112
-------------------------------------
SECTION 11.04. Selection by Trustee of Notes to Be
-----------------------------------
Redeemed................................... 112
--------
SECTION 11.05. Notice of Redemption....................... 113
--------------------
SECTION 11.06. Deposit of Redemption Price................ 114
---------------------------
SECTION 11.07. Notes Payable on Redemption Date........... 114
--------------------------------
SECTION 11.08. Notes Redeemed in Part..................... 115
----------------------
ARTICLE XII Defeasance and Covenant Defeasance
----------------------------------
SECTION 12.01. Company's Option to Effect Defeasance
-------------------------------------
or Covenant Defeasance..................... 115
----------------------
iv
Page
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SECTION 12.02. Defeasance and Discharge................... 115
------------------------
SECTION 12.03. Covenant Defeasance........................ 116
-------------------
SECTION 12.04. Conditions to Defeasance or Covenant
------------------------------------
Defeasance................................. 116
----------
SECTION 12.05. Deposited U.S. Government Obligations
-------------------------------------
to be Held in Trust; Other Miscellaneous
----------------------------------------
Provisions................................. 118
----------
SECTION 12.06. Reinstatement.............................. 119
-------------
ARTICLE XIII
[Intentionally Left Blank]
ARTICLE XIV Subordination of Notes
----------------------
SECTION 14.01. Notes Subordinate to Senior
---------------------------
Indebtedness............................... 120
------------
SECTION 14.02. Payment Over of Proceeds Upon
-----------------------------
Dissolution, Etc........................... 120
----------------
SECTION 14.03. No Payment When Senior Indebtedness in
--------------------------------------
Default.................................... 121
-------
SECTION 14.04. Certain Payments Permitted................. 122
--------------------------
SECTION 14.05. Subrogation to Rights of Holders of
-----------------------------------
Senior Indebtedness........................ 122
-------------------
SECTION 14.06. Provisions Solely to Define Relative
------------------------------------
Rights..................................... 123
------
SECTION 14.07. Trustee to Effectuate Subordination........ 123
-----------------------------------
SECTION 14.08. No Waiver of Subordination Provisions...... 123
-------------------------------------
SECTION 14.09. Notice to Trustee.......................... 124
-----------------
SECTION 14.10. Reliance on Judicial Order or
-----------------------------
Certificate of Liquidating Agent........... 125
--------------------------------
SECTION 14.11. Trustee Not Fiduciary for Holders of
------------------------------------
Senior Indebtedness........................ 125
-------------------
SECTION 14.12. Rights of Trustee as Holder of Senior
-------------------------------------
Indebtedness; Preservation of Trustee's
---------------------------------------
Rights..................................... 125
------
SECTION 14.13. Article Applicable to Paying Agents........ 126
-----------------------------------
SECTION 14.14. Defeasance of this Article Fourteen........ 126
-----------------------------------
ARTICLE XV Jurisdiction and Consent to
---------------------------
Service of Process
------------------
SECTION 15.01. Jurisdiction and Consent to Service
-----------------------------------
of Process................................. 126
----------
ANNEX A -- Form of Regulation S Certificate
v
Page
----
ANNEX B -- Form of Restricted Notes Certificate
ANNEX C -- Form of Unrestricted Notes Certificate
ANNEX D -- Form of Supplemental Indenture For Subsidiary
Guaranties
vi
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the day and year first above written.
AFC ENTERPRISES, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Vice President,
General Counsel and Secretary
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Vice President