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COLOR SPOT NURSERIES, INC.
AND
U.S. TRUST COMPANY OF CALIFORNIA, N.A.,
AS TRUSTEE
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INDENTURE
DATED AS OF DECEMBER __, 1997
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$85,000,000
___% SENIOR SUBORDINATED NOTES
DUE 2007
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CROSS REFERENCE TABLE
TIA Indenture
Section Section
---------- ----------
310(a)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.10
310(a)(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.10
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.10
310(b)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.10
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.11
311(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.11
312(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.3
312(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.3
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8.6
313(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8.6
313(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8.6
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.9
318(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of the Indenture.
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE. . . . . . . . . . . . . . . . . . 1
Section 1.1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Incorporation by Reference of TIA. . . . . . . . . . . . . . . . . . .19
Section 1.3. Rules of Construction. . . . . . . . . . . . . . . . . . . . . . . . .20
ARTICLE II. THE SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Section 2.1. Form and Dating. . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Section 2.2. Execution and Authentication.. . . . . . . . . . . . . . . . . . . . .21
Section 2.3. Registrar and Paying Agent.. . . . . . . . . . . . . . . . . . . . . .22
Section 2.4. Paying Agent To Hold Assets in Trust.. . . . . . . . . . . . . . . . .22
Section 2.5. Holder Lists.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
Section 2.6. Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . . . .23
Section 2.7. Replacement Securities.. . . . . . . . . . . . . . . . . . . . . . . .24
Section 2.8. Outstanding Securities.. . . . . . . . . . . . . . . . . . . . . . . .24
Section 2.9. Treasury Securities. . . . . . . . . . . . . . . . . . . . . . . . . .25
Section 2.10. Temporary Securities. . . . . . . . . . . . . . . . . . . . . . . . .25
Section 2.11. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Section 2.12. Defaulted Interest. . . . . . . . . . . . . . . . . . . . . . . . . .26
Section 2.13. CUSIP Number. . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
ARTICLE III. REDEMPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Section 3.1. Notices to Trustee.. . . . . . . . . . . . . . . . . . . . . . . . . .26
Section 3.2. Selection of Securities To Be Redeemed.. . . . . . . . . . . . . . . .26
Section 3.3. Notice of Redemption.. . . . . . . . . . . . . . . . . . . . . . . . .27
Section 3.4. Effect of Notice of Redemption.. . . . . . . . . . . . . . . . . . . .28
Section 3.5. Deposit of Redemption Price. . . . . . . . . . . . . . . . . . . . . .28
Section 3.6. Securities Redeemed in Part. . . . . . . . . . . . . . . . . . . . . .28
ARTICLE IV. SUBORDINATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
Section 4.1. Securities Subordinated to Senior Debt.. . . . . . . . . . . . . . . .28
Section 4.2. Suspension of Payment When Senior Debt in Default. . . . . . . . . . .29
Section 4.3. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company. . . . . . . . . . . . .30
Section 4.4. Holders To Be Subrogated to Rights of Holders of Senior
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Section 4.5. Obligations of the Company Unconditional.. . . . . . . . . . . . . . .32
Section 4.6. Trustee Entitled To Assume Payments Not Prohibited in
Absence of Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
Section 4.7. Application by Trustee of Assets Deposited with It.. . . . . . . . . .32
Section 4.8. No Waiver of Subordination Provisions. . . . . . . . . . . . . . . . .33
Section 4.9. Holders Authorize Trustee To Effectuate Subordination of Securities. .34
Section 4.10. Right of Trustee To Hold Senior Debt. . . . . . . . . . . . . . . . .34
Section 4.11. No Suspension of Remedies.. . . . . . . . . . . . . . . . . . . . . .34
Section 4.12. No Fiduciary Duty of Trustee to Holders of Senior Debt. . . . . . . .35
ARTICLE V. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Section 5.1. Payment of Securities. . . . . . . . . . . . . . . . . . . . . . . . .35
Section 5.2. Maintenance of Office or Agency. . . . . . . . . . . . . . . . . . . .35
Section 5.3. Limitation on Restricted Payments. . . . . . . . . . . . . . . . . . .35
Section 5.4. Corporate Existence. . . . . . . . . . . . . . . . . . . . . . . . . .37
Section 5.5. Payment of Taxes and Other Claims. . . . . . . . . . . . . . . . . . .37
Section 5.6. Maintenance of Properties and Insurance. . . . . . . . . . . . . . . .38
Section 5.7. Compliance Certificate; Notice of Default. . . . . . . . . . . . . . .38
Section 5.8. Compliance with Laws.. . . . . . . . . . . . . . . . . . . . . . . . .39
Section 5.9. SEC Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
Section 5.10. Waiver of Stay, Extension or Usury Laws.. . . . . . . . . . . . . . .40
Section 5.11. Limitation on Transactions with Affiliates. . . . . . . . . . . . . .40
Section 5.12. Limitation on Incurrences of Additional Indebtedness. . . . . . . . .41
Section 5.13. Limitation on Dividends and Other Payment Restrictions Affecting
Restricted Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . . .41
Section 5.14. Limitation on Liens.. . . . . . . . . . . . . . . . . . . . . . . . .42
Section 5.15. Limitation on Change of Control.. . . . . . . . . . . . . . . . . . .42
Section 5.16. Limitation on Asset Sales.. . . . . . . . . . . . . . . . . . . . . .44
Section 5.17. Limitation on Preferred Stock of Restricted Subsidiaries. . . . . . .47
Section 5.18. Limitation on Other Senior Subordinated Debt. . . . . . . . . . . . .47
Section 5.19. Limitation on Restricted and Unrestricted Subsidiaries. . . . . . . .47
Section 5.20. Limitation of Guarantees by Restricted Subsidiaries.. . . . . . . . .48
Section 5.21. Conduct of Business.. . . . . . . . . . . . . . . . . . . . . . . . .48
ARTICLE VI. SUCCESSOR CORPORATION. . . . . . . . . . . . . . . . . . . . . . . . . . . .49
Section 6.1. Limitations on Mergers and Certain Other Transactions. . . . . . . . .49
Section 6.2. Successor Corporation Substituted. . . . . . . . . . . . . . . . . . .50
ARTICLE VII. DEFAULT AND REMEDIES. . . . . . . . . . . . . . . . . . . . . . . . . . . .50
Section 7.1. Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . .50
Section 7.2. Acceleration.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
Section 7.3. Other Remedies.. . . . . . . . . . . . . . . . . . . . . . . . . . . .52
Section 7.4. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . . . . .52
Section 7.5. Control by Majority. . . . . . . . . . . . . . . . . . . . . . . . . .53
Section 7.6. Limitation on Suits. . . . . . . . . . . . . . . . . . . . . . . . . .53
Section 7.7. Rights of Holders To Receive Payment.. . . . . . . . . . . . . . . . .53
Section 7.8. Collection Suit by Trustee.. . . . . . . . . . . . . . . . . . . . . .54
Section 7.9. Trustee May File Proofs of Claim.. . . . . . . . . . . . . . . . . . .54
Section 7.10. Priorities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54
Section 7.11. Rights and Remedies Cumulative. . . . . . . . . . . . . . . . . . . .55
Section 7.12. Delay or Omission Not Waiver. . . . . . . . . . . . . . . . . . . . .55
Section 7.13. Undertaking for Costs.. . . . . . . . . . . . . . . . . . . . . . . .55
ARTICLE VIII. TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55
Section 8.1. Duties of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . .55
Section 8.2. Rights of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . .56
Section 8.3. Individual Rights of Trustee.. . . . . . . . . . . . . . . . . . . . .57
Section 8.4. Trustee's Disclaimer.. . . . . . . . . . . . . . . . . . . . . . . . .57
Section 8.5. Notice of Default. . . . . . . . . . . . . . . . . . . . . . . . . . .57
Section 8.6. Reports by Trustee to Holders. . . . . . . . . . . . . . . . . . . . .58
Section 8.7. Compensation and Indemnity.. . . . . . . . . . . . . . . . . . . . . .58
Section 8.8. Replacement of Trustee.. . . . . . . . . . . . . . . . . . . . . . . .59
Section 8.9. Successor Trustee by Merger, Etc.. . . . . . . . . . . . . . . . . . .60
Section 8.10. Eligibility; Disqualification.. . . . . . . . . . . . . . . . . . . .60
Section 8.11. Preferential Collection of Claims Against Company.. . . . . . . . . .60
ARTICLE IX. SATISFACTION AND DISCHARGE OF INDENTURE. . . . . . . . . . . . . . . . . . .60
Section 9.1. Termination of the Company's Obligations.. . . . . . . . . . . . . . .60
Section 9.2. Legal Defeasance and Covenant Defeasance.. . . . . . . . . . . . . . .61
Section 9.3. Application of Trust Money.. . . . . . . . . . . . . . . . . . . . . .64
Section 9.4. Repayment to the Company.. . . . . . . . . . . . . . . . . . . . . . .64
Section 9.5. Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . . . . .64
ARTICLE X. AMENDMENTS, SUPPLEMENTS AND WAIVERS . . . . . . . . . . . . . . . . . . . . .65
Section 10.1. Without Consent of Holders. . . . . . . . . . . . . . . . . . . . . .65
Section 10.2. With Consent of Holders.. . . . . . . . . . . . . . . . . . . . . . .65
Section 10.3. Compliance with TIA.. . . . . . . . . . . . . . . . . . . . . . . . .66
Section 10.4. Revocation and Effect of Consents.. . . . . . . . . . . . . . . . . .66
Section 10.5. Notation on or Exchange of Securities.. . . . . . . . . . . . . . . .67
Section 10.6. Trustee To Sign Amendments, Etc.. . . . . . . . . . . . . . . . . . .67
ARTICLE XI. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67
Section 11.1. TIA Controls. . . . . . . . . . . . . . . . . . . . . . . . . . . . .67
Section 11.2. Notices.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .68
Section 11.3. Communications by Holders with Other Holders. . . . . . . . . . . . .69
Section 11.4. Certificate and Opinion as to Conditions Precedent. . . . . . . . . .69
Section 11.5. Statements Required in Certificate or Opinion.. . . . . . . . . . . .69
Section 11.6. Rules by Trustee, Paying Agent, Registrar.. . . . . . . . . . . . . .69
Section 11.7. Legal Holidays. . . . . . . . . . . . . . . . . . . . . . . . . . . .70
Section 11.8. Governing Law.. . . . . . . . . . . . . . . . . . . . . . . . . . . .70
Section 11.9. No Adverse Interpretation of Other Agreements.. . . . . . . . . . . .70
Section 11.10. No Recourse Against Others.. . . . . . . . . . . . . . . . . . . . .70
Section 11.11. Successors.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .70
Section 11.12. Duplicate Originals. . . . . . . . . . . . . . . . . . . . . . . . .70
Section 11.13. Severability.. . . . . . . . . . . . . . . . . . . . . . . . . . . .70
INDENTURE dated as of December __, 1997, between COLOR SPOT NURSERIES,
INC., a Delaware corporation, and U.S. TRUST COMPANY OF CALIFORNIA, N.A., a
national banking association, as Trustee.
Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Company's
____% Senior Subordinated Notes due 2007 (the "Securities"):
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary of
the Company or at the time it merges or consolidates with the Company or any of
its Restricted Subsidiaries or assumed in connection with the acquisition of
assets from such Person and in each case not incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary of the Company or such acquisition, merger or
consolidation.
"Affiliate" means, with respect to any specified Person, any other
Person who directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person.
The term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative of the
foregoing.
"Affiliate Transaction" shall have the meaning provided in Section
5.11(a).
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Acquisition" means (a) an Investment by the Company or any
Restricted Subsidiary of the Company in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Company or of any Restricted
Subsidiary of the Company, or shall be merged with or into the Company or any
Restricted Subsidiary of the Company, or (b) the acquisition by the Company or
any Restricted Subsidiary of the Company of the assets of any Person (other than
a Restricted Subsidiary of the Company) which constitute all or substantially
all of the assets of such Person or comprises any division or line of business
of such Person or any other properties or assets of such Person other than in
the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
transfer, lease (other than operating leases entered into in the ordinary course
of business), assignment or other transfer for value by the Company or any of
its Restricted Subsidiaries (including any Sale and Leaseback Transaction) to
any Person other than the Company or a Wholly Owned Restricted Subsidiary of the
Company of (a) any Capital Stock of any Restricted Subsidiary of
the Company; or (b) any other property or assets of the Company or any
Restricted Subsidiary of the Company other than in the ordinary course of
business; PROVIDED, HOWEVER, that Asset Sales shall not include (i) a
transaction or series of related transactions for which the Company or its
Restricted Subsidiaries receive aggregate consideration of less than $500,000;
(ii) the sale, lease, conveyance, disposition or other transfer of all or
substantially all of the assets of the Company as permitted under Section 6.1,
(iii) sales of accounts receivable and related assets of the type specified in
the definition of "Qualified Receivables Transaction" to a Receivables
Subsidiary in connection with a Qualified Receivables Transaction; and (iv)
sales of Permitted Investments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person or of a subsidiary of such Person or any duly
authorized committee of that Board.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate stock, including
each class of Common Stock and Preferred Stock of such Person and (ii) with
respect to any Person that is not a corporation, any and all partnership or
other equity interests of such Person.
"Capitalized Lease Obligation" means, as to any Person, the
obligations of such Person under a lease that are required to be classified and
accounted for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date, determined in accordance with GAAP.
"Cash Equivalents" means (i) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof;
(ii) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either Standard & Poor's Corporation ("S&P") or Xxxxx'x
Investors Service, Inc. ("Moody's"); (iii) commercial paper maturing no more
than one year from the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from Moody's;
(iv) certificates of deposit or bankers' acceptances maturing within one year
from the date of acquisition thereof issued by any bank organized under the laws
of the United States of America
-2-
or any state thereof or the District of Columbia or any U.S. branch of a foreign
bank having at the date of acquisition thereof combined capital and surplus of
not less than $250,000,000; (v) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clause
(i) above entered into with any bank meeting the qualifications specified in
clause (iv) above; and (vi) investments in money market funds which invest
substantially all their assets in securities of the types described in clauses
(i) through (v) above.
"Change of Control" means the occurrence of one or more of the
following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the assets of the Company to any Person or group of related Persons for purposes
of Section 13(d) of the Exchange Act (a "Group"), together with any Affiliates
thereof (whether or not otherwise in compliance with the provisions of this
Indenture); (ii) the approval by the holders of Capital Stock of the Company of
any plan or proposal for the liquidation or dissolution of the Company (whether
or not otherwise in compliance with the provisions of this Indenture); (iii) any
Person or Group (other than the Permitted Holder(s)) shall become the owner,
directly or indirectly, beneficially or of record, of shares representing more
than 50% of the aggregate ordinary voting power represented by the issued and
outstanding Capital Stock of the Company; or (iv) the replacement of a majority
of the Board of Directors of the Company over a two-year period from the
directors who constituted the Board of Directors of the Company at the beginning
of such period, and such replacement shall not have been approved by a vote of
at least a majority of the Board of Directors of the Company then still in
office who either were members of such Board of Directors at the beginning of
such period or whose election as a member of such Board of Directors was
previously so approved.
"Change of Control Offer" shall have the meaning provided in Section
5.15(a).
"Change of Control Payment Date" shall have the meaning provided in
Section 5.15(b).
"Commission" means the Securities and Exchange Commission.
"Common Stock" of any Person means any and all shares, interests or
other participations in, and other equivalents (however designated and whether
voting or non-voting) of such Person's common stock, whether outstanding on the
Issue Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"Company" means Color Spot Nurseries, Inc., a Delaware corporation,
until a successor replaces it pursuant to this Indenture and thereafter means
such successor.
"Consolidated EBITDA" means, with respect to any Person, for any
period, the sum (without duplication) of (i) Consolidated Net Income and (ii) to
the extent Consolidated Net Income has been reduced thereby, (A) all income
taxes of such Person and its Restricted Subsidiaries paid or accrued in
accordance with GAAP for such period (other than income taxes attributable to
extraordinary, unusual or nonrecurring gains or losses or taxes attributable to
sales or dispositions outside the ordinary course of business), (B) Consolidated
Interest Expense, (C) Consolidated Non-cash Charges LESS any non-cash items
increasing Consolidated Net Income
-3-
for such period, all as determined on a consolidated basis for such Person and
its Restricted Subsidiaries in accordance with GAAP, (D) any expenses or charges
related to the termination of the Fee Agreement and (E) any write-off of
deferred financing costs in connection with the refinancing of the Company's
credit agreement in existence prior to the Credit Agreement and any refinancings
of the Credit Agreement.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
Person, the ratio of Consolidated EBITDA of such Person during the four full
fiscal quarters (the "Four Quarter Period") ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the "Transaction Date") to Consolidated Fixed Charges of
such Person for the Four Quarter Period. In addition to and without limitation
of the foregoing, for purposes of this definition, "Consolidated EBITDA" and
"Consolidated Fixed Charges" shall be calculated after giving effect on a
PRO FORMA basis for the period of such calculation to (i) the incurrence or
repayment of any Indebtedness of such Person or any of its Restricted
Subsidiaries (and the application of the proceeds thereof) giving rise to the
need to make such calculation and any incurrence or repayment of other
Indebtedness (and the application of the proceeds thereof), other than the
incurrence or repayment of Indebtedness in the ordinary course of business for
working capital purposes pursuant to working capital facilities, occurring
during the Four Quarter Period or at any time subsequent to the last day of the
Four Quarter Period and on or prior to the Transaction Date, as if such
incurrence or repayment, as the case may be (and the application of the proceeds
thereof), occurred on the first day of the Four Quarter Period and (ii) any
Asset Sales or Asset Acquisitions (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a result of such
Person or one of its Restricted Subsidiaries (including any Person who becomes a
Restricted Subsidiary as a result of the Asset Acquisition) incurring, assuming
or otherwise being liable for Acquired Indebtedness and also including any
Consolidated EBITDA (provided that such Consolidated EBITDA shall be included
only to the extent includable pursuant to the definition of "Consolidated Net
Income") attributable to the assets which are the subject of the Asset
Acquisition or Asset Sale during the Four Quarter Period) occurring during the
Four Quarter Period or at any time subsequent to the last day of the Four
Quarter Period and on or prior to the Transaction Date, as if such Asset Sale or
Asset Acquisition (including the incurrence, assumption or liability for any
such Acquired Indebtedness) occurred on the first day of the Four Quarter
Period. If such Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give (without duplication) effect to the incurrence of such guaranteed
Indebtedness as if such Person or any Restricted Subsidiary of such Person had
directly incurred or otherwise assumed such guaranteed Indebtedness.
Furthermore, in calculating "Consolidated Fixed Charges" for purposes of
determining the denominator (but not the numerator) of this "Consolidated Fixed
Charge Coverage Ratio," (1) interest on outstanding Indebtedness determined on a
fluctuating basis as of the Transaction Date and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum
equal to the rate of interest on such Indebtedness in effect on the Transaction
Date; (2) if interest on any Indebtedness actually incurred on the Transaction
Date may optionally be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate, or other rates,
then the interest rate in effect on the Transaction Date will be deemed to have
been in effect during the Four Quarter Period; and (3)
-4-
notwithstanding clause (1) above, interest on Indebtedness determined on a
fluctuating basis, to the extent such interest is covered by agreements relating
to Interest Swap Obligations, shall be deemed to accrue at the rate per annum
resulting after giving effect to the operation of the operation of such
agreements.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum (without duplication) of (i) Consolidated Interest Expense, plus
(ii) the product of (x) the amount of all dividend payments on any series of
Preferred Stock of such Person (other than dividends paid in Qualified Capital
Stock) paid, accrued or scheduled to be paid or accrued during such period times
(y) a fraction, the numerator of which is one and the denominator of which is
one minus the then current effective consolidated federal, state and local tax
rate of such Person, expressed as a decimal.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum of (without duplication): (i) the aggregate of the interest
expense of such Person and its Restricted Subsidiaries of such period determined
on a consolidated basis in accordance with GAAP, including without limitation,
(a) any amortization of debt discount and amortization or write-off of deferred
financing costs (excluding any write-off of deferred financing costs in
connection with the refinancing of the Company's credit agreement in existence
prior to the Credit Agreement or any refinancing of the Credit Agreement),
(b) the net costs under Interest Swap Obligations, (c) all capitalized interest
and (d) the interest portion of any deferred payment obligation; and (ii) the
interest component of Capitalized Lease Obligations paid, accrued and/or
scheduled to be paid or accrued by such Person and its Restricted Subsidiaries
during such period as determined on a consolidated basis in accordance with
GAAP.
"Consolidated Net Income" means, with respect to any Person, for any
period, the aggregate net income (or loss) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP; PROVIDED that there shall be excluded therefrom (a) after-tax gains
from Asset Sales or abandonments or reserves relating thereto, (b) after-tax
items classified as extraordinary or nonrecurring gains, (c) the net income of
any Person acquired in a "pooling of interests" transaction accrued prior to the
date it becomes a Restricted Subsidiary of the referent Person or is merged or
consolidated with the referent Person or any Restricted Subsidiary of the
referent Person, (d) the net income (but not loss) of any Restricted Subsidiary
of the referent Person to the extent that the declaration of dividends or
similar distributions by that Restricted Subsidiary of that income is restricted
by a contract, operation of law or otherwise, (e) the net income of any Person,
other than a Restricted Subsidiary of the referent Person, except to the extent
of cash dividends or distributions paid to the referent Person or to a Wholly
Owned Restricted Subsidiary of the referent Person by such Person, (f) any
restoration to income of any contingency reserve, except to the extent that
provision for such reserve was made out of Consolidated Net Income accrued at
any time following the Issue Date, (g) income or loss attributable to
discontinued operations (including, without limitation, operations disposed of
during such period whether or not such operations were classified as
discontinued), and (h) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's assets, any
earnings of the successor corporation prior to such consolidation, merger or
transfer of assets.
-5-
"Consolidated Net Worth" of any Person means the consolidated
stockholders' equity of such Person, determined on a consolidated basis in
accordance with GAAP, less (without duplication) amounts attributable to
Disqualified Capital Stock of such Person.
"Consolidated Non-cash Charges" means, with respect to any Person, for
any period, the aggregate depreciation, amortization and other non-cash expenses
of such Person and its Restricted Subsidiaries reducing Consolidated Net Income
of such Person and its Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP (excluding any such charges
constituting an extraordinary item or loss or any such charge which requires an
accrual of or a reserve for cash charges for any future period).
"Credit Agent" means, at any time, the then-acting Administrative
Agent as defined in and under the Credit Agreement, which initially shall be
Credit Agricole Indosuez. The Company shall promptly notify the Trustee of any
change in the Credit Agent.
"Credit Agreement" means the Second Amended and Restated Credit
Agreement dated as of __________, 1997, between the Company, the lenders party
thereto in their capacities as lenders thereunder and Credit Agricole Indosuez,
as agent, together with the related documents thereto (including, without
limitation, any guarantee agreements and security documents), in each case as
such agreements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including increasing the amount of available borrowings
thereunder (PROVIDED that such increase in borrowings is Permitted Indebtedness
or is permitted by Section 5.12) or adding Restricted Subsidiaries of the
Company as additional guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group of lenders.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Default" means an event or condition the occurrence of which is, or
with the lapse of time or the giving of notice or both would be, an Event of
Default.
"Depository" shall mean the Depository Trust Company, New York, New
York, or a successor thereto registered under the Exchange Act or other
applicable statute or regulation.
"Designated Senior Debt" means (i) Indebtedness under or in respect of
the Credit Agreement and (ii) any other Indebtedness constituting Senior Debt
which, at the time of determination, has an aggregate principal amount of at
least $25,000,000 and is specifically designated in the instrument evidencing
such Senior Debt as "Designated Senior Debt" by the Company.
-6-
"Disqualified Capital Stock" means that portion of any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable (other than in connection with a
Change of Control), pursuant to a sinking fund obligation or otherwise, or is
redeemable at the sole option of the holder thereof on or prior to the final
maturity date of the Securities.
"Event of Default" shall have the meaning provided in Section 7.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto and the rules and regulations
promulgated by the Commission thereunder.
"Fee Agreement" means that certain fee agreement between the Company
and Kohlberg & Company, LLC dated as of December 31, 1996, as amended.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect as of the Issue Date.
"Global Security" shall mean a Security which is executed by the
Company and authenticated and delivered by the Trustee to the Depository or
pursuant to the Depository's instruction, all in accordance with this Indenture
and pursuant to a written order, which shall be registered in the name of the
Depository or its nominee and which, together with any other Global Security
representing Securities hereunder, shall represent, and shall be denominated in
an amount equal to the aggregate principal amount of, all of the outstanding
Securities.
"Guarantee" shall have the meaning set forth in Section 5.20.
"Holder" means the Person in whose name a Security is registered on
the Registrar's books.
"Incur" means, with respect to any Indebtedness or other obligation of
any Person, to, directly or indirectly, create, incur, assume, guarantee,
acquire, become liable, contingently or otherwise, with respect to, or otherwise
become responsible for payment of Indebtedness or other obligations or the
recording, as required pursuant to GAAP or otherwise, of any such Indebtedness
or other obligation on the balance sheet of such Person (and "Incurrence,"
"Incurred" and "Incurring" shall have meanings correlative to the foregoing).
"Indebtedness" means 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, debentures, notes or other similar instruments,
(iii) all Capitalized Lease Obligations of such Person, (iv) all Obligations of
such Person issued or assumed as the deferred purchase price
-7-
of property, all conditional sale obligations and all Obligations under any
title retention agreement (but excluding trade accounts payable and other
accrued liabilities arising in the ordinary course of business that are not
overdue by 90 days or more or are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and excluding
long-term, deferred purchase price obligations for trees, PROVIDED that such
obligations for trees are not recorded as liabilities on such Person's balance
sheet in accordance with GAAP), (v) all Obligations for the reimbursement of any
obligor on any letter of credit, banker's acceptance or similar credit
transaction, (vi) guarantees and other contingent obligations in respect of
Indebtedness referred to in clauses (i) through (v) above and clause (viii)
below, (vii) all Obligations of any other Person of the type referred to in
clauses (i) through (vi) which are secured by any lien on any property or asset
of such Person, the amount of such Obligation being deemed to be the lesser of
the fair market value of such property or asset or the amount of the Obligation
so secured, (viii) all Obligations under Currency Agreements and Interest Swap
Obligations of such Person and (ix) all Disqualified Capital Stock issued by
such Person with the amount of Indebtedness represented by such Disqualified
Capital Stock being equal to the greater of its voluntary or involuntary
liquidation preference and its maximum fixed repurchase price, but excluding
accrued dividends, if any. For purposes hereof, the "maximum fixed repurchase
price" of any Disqualified Capital Stock which does not have a fixed repurchase
price shall be calculated in accordance with the terms of such Disqualified
Capital Stock as if such Disqualified Capital Stock were purchased on any date
on which Indebtedness shall be required to be determined pursuant to this
Indenture, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined reasonably and in good faith by the Board of Directors of the issuer
of such Disqualified Capital Stock.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Independent Financial Advisor" means a firm (i) which does not, and
whose directors, officers and employees or Affiliates do not, have a direct or
indirect financial interest in the Company (other than an interest in less than
5% of the Company's Common Stock after such time as the Company's Common Stock
is publicly traded) and (ii) which, in the judgment of the Board of Directors of
the Company, is otherwise independent and qualified to perform the task for
which it is to be engaged.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Securities.
"Interest Swap Obligation" means the obligations of any Person
pursuant to any arrangement with any other Person, whereby, directly or
indirectly, such Person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest on
a stated notional amount in exchange for periodic payments made by such other
Person calculated by applying a fixed or a floating rate of interest on the same
notional amount and shall include, without limitation, interest rate swaps,
caps, floors, collars and similar agreements.
-8-
"Investment" means, with respect to any Person, any direct or indirect
loan or other extension of credit (including, without limitation, a guarantee)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by the
Company and its Restricted Subsidiaries on commercially reasonable terms in
accordance with normal trade practices of the Company or such Restricted
Subsidiary, as the case may be. For the purposes of Section 5.3, (i)
"Investment" shall include and be valued at the fair market value of the net
assets of any Restricted Subsidiary at the time that such Restricted Subsidiary
is designated as an Unrestricted Subsidiary and shall exclude the fair market
value of the net assets of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated as a Restricted Subsidiary and (ii) the
amount of any Investment shall be the original cost of such Investment plus the
cost of all additional Investments by the Company or any of its Restricted
Subsidiaries, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment, reduced by
the payment of dividends or distributions in connection with such Investment or
any other amounts received in respect of such Investment; PROVIDED that no such
payment of dividends or distributions or receipt of any such other amounts shall
reduce the amount of any Investment if such payment of dividends or
distributions or receipt of any such amounts would be included in Consolidated
Net Income. If the Company or any Restricted Subsidiary of the Company sells or
otherwise disposes of any Common Stock of any direct or indirect Restricted
Subsidiary of the Company such that, after giving effect to any such sale or
disposition, the Company no longer owns, directly or indirectly, 100% of the
outstanding Common Stock of such Restricted Subsidiary, the Company shall be
deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Common Stock of such Restricted Subsidiary
not sold or disposed of.
"Issue Date" means ___________, 1997, the date of original issuance of
the Securities under this Indenture.
"Legal Holiday" shall have the meaning provided in Section 11.7.
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).
"Maturity Date" means _______ ___, 2007.
"Net Cash Proceeds" means, with respect to any Asset Sale, the
proceeds in the form of cash or Cash Equivalents including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents (other than the portion of any such deferred payment constituting
interest) received by the Company or any of its Restricted Subsidiaries from
such Asset Sale net of (a) reasonable out-of-pocket expenses and fees relating
to such Asset Sale (including, without limitation, legal, accounting and
investment banking fees and sales commissions), (b) taxes paid or payable after
taking into account any reduction in
-9-
consolidated tax liability due to available tax credits or deductions and any
tax sharing arrangements, (c) repayment of Indebtedness that is required to be
repaid in connection with such Asset Sale and (d) appropriate amounts to be
provided by the Company or any of its Restricted Subsidiaries, as the case may
be, as a reserve, in accordance with GAAP, against any liabilities associated
with such Asset Sale and retained by the Company or any Restricted Subsidiary,
as the case may be, after such Asset Sale, including, without limitation,
pension and other post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification obligations
associated with such Asset Sale.
"Net Proceeds Offer" shall have the meaning provided in Section
5.16(a).
"Net Proceeds Offer Amount" shall have the meaning provided in Section
5.16(a).
"Net Proceeds Offer Payment Date" shall have the meaning provided in
Section 5.16(a).
"Net Proceeds Trigger Date" shall have the meaning provided in Section
5.16(a).
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chief Executive
Officer, the Chief Financial Officer or the Chief Accounting Officer of such
Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two officers of the Company, one of whom must be an Officer of the
Company and otherwise complying with the requirements of Sections 11.4 and 11.5.
"operating lease" means any lease the obligations under which do not
constitute Capitalized Lease Obligations.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of Sections
11.4 and 11.5. Unless otherwise required by the Trustee, the legal counsel may
be an employee of or counsel to the Company or the Trustee.
"Paying Agent" shall have the meaning provided in Section 2.3, except
that for the purposes of Articles Three and Nine and Sections 5.15 and 5.16, the
Paying Agent shall not be the Company or an Affiliate of the Company.
"Permitted Holder(s)" means KCSN Acquisition Company, L.P. and its
Affiliates, Kohlberg & Company, LLC and its Affiliates and Xxxxxxx X. Xxxxxxxx
and his Affiliates.
"Permitted Indebtedness" means, without duplication, each of the
following:
(i) Indebtedness under the Securities and this Indenture;
-10-
(ii) Indebtedness incurred pursuant to the Credit Agreement in an
aggregate principal amount at any time outstanding not to exceed $150.0
million, less the amount of all mandatory principal payments actually made
by the Company in respect of the Term Loan Facility (excluding any such
payments to the extent refinanced at the time of payment under a replaced
Credit Agreement), PROVIDED that (1) not more than $110.0 million of
borrowings under the Credit Agreement are used to make Asset Acquisitions
and (2) not more than $90.0 million of borrowings under the Credit
Agreement are used for any other purpose;
(iii) other Indebtedness of the Company and its Restricted Subsidiaries
outstanding on the Issue Date reduced by the amount of any scheduled
amortization payments or mandatory prepayments when actually paid or
permanent reductions thereon;
(iv) Interest Swap Obligations of the Company covering Indebtedness of
the Company or any of its Restricted Subsidiaries and Interest Swap
Obligations of any Restricted Subsidiary of the Company covering
Indebtedness of such Restricted Subsidiary; PROVIDED, HOWEVER, that such
Interest Swap Obligations are entered into to protect the Company and its
Restricted Subsidiaries from fluctuations in interest rates on Indebtedness
incurred in accordance with this Indenture to the extent the notional
principal amount of such Interest Swap Obligation does not exceed the
principal amount of the Indebtedness to which such Interest Swap Obligation
relates;
(v) Indebtedness under Currency Agreements; PROVIDED that in the case
of Currency Agreements which relate to Indebtedness, such Currency
Agreements do not increase the Indebtedness of the Company and its
Restricted Subsidiaries outstanding other than as a result of fluctuations
in foreign currency exchange rates or by reason of fees, indemnitees and
compensation payable thereunder;
(vi) Indebtedness of a Wholly Owned Restricted Subsidiary of the
Company to the Company or to a Wholly Owned Restricted Subsidiary of the
Company for so long as such Indebtedness is held by the Company or a Wholly
Owned Restricted Subsidiary of the Company, in each case subject to no Lien
held by a Person other than the Company or a Wholly Owned Restricted
Subsidiary of the Company (other than the Lien of the Credit Agent under
the Credit Agreement); PROVIDED that if as of any date any Person other
than the Company or a Wholly Owned Restricted Subsidiary of the Company
owns or holds any such Indebtedness or holds a Lien in respect of such
Indebtedness, such date shall be deemed the incurrence of Indebtedness not
constituting Permitted Indebtedness by the issuer of such Indebtedness;
(vii) Indebtedness of the Company to a Wholly Owned Restricted
Subsidiary of the Company for so long as such Indebtedness is held by a
Wholly Owned Restricted Subsidiary of the Company, in each case subject to
no Lien; PROVIDED that (a) any Indebtedness of the Company to any Wholly
Owned Restricted Subsidiary of the Company is unsecured and subordinated,
pursuant to a written agreement, to the
-11-
Company's obligations under this Indenture and the Securities and (b) if as
of any date any Person other than a Wholly Owned Restricted Subsidiary of
the Company owns or holds any such Indebtedness or any Person holds a Lien
in respect of such Indebtedness, such date shall be deemed the incurrence
of Indebtedness not constituting Permitted Indebtedness by the Company;
(viii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business; PROVIDED, HOWEVER, that such
Indebtedness is extinguished within two business days of incurrence;
(ix) Indebtedness of the Company or any of its Restricted Subsidiaries
represented by letters of credit for the account of the Company or such
Restricted Subsidiary, as the case may be, in order to provide security for
workers' compensation claims, payment obligations in connection with
self-insurance or similar requirements in the ordinary course of business;
(x) Refinancing Indebtedness;
(xi) Indebtedness incurred in a Qualified Receivables Transaction that
is without recourse to the Company or to any Restricted Subsidiary of the
Company or their assets (other than a Receivables Subsidiary and its
assets); and
(xii) additional Indebtedness of the Company and its Restricted
Subsidiaries in an aggregate principal amount not to exceed $25,000,000 at
any one time outstanding.
"Permitted Investments" means (i) Investments by the Company or any
Restricted Subsidiary of the Company in any Person that is or will become
immediately after such Investment a Wholly Owned Restricted Subsidiary of the
Company or that will merge or consolidate into the Company or a Wholly Owned
Restricted Subsidiary of the Company; (ii) Investments in the Company by any
Restricted Subsidiary of the Company; PROVIDED that any Indebtedness evidencing
such Investment is unsecured and subordinated, pursuant to a written agreement,
to the Company's obligations under the Securities and this Indenture; (iii)
investments in cash and Cash Equivalents; (iv) loans and advances to employees
and officers of the Company and its Restricted Subsidiaries in the ordinary
course of business for bona fide business purposes not in excess of $2,000,000
at any one time outstanding; (v) Currency Agreements and Interest Swap
Obligations entered into in the ordinary course of the Company's or its
Restricted Subsidiaries' businesses and otherwise in compliance with this
Indenture; (vi) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers; (vii) Investments
made by the Company or its Restricted Subsidiaries as a result of consideration
received in connection with an Asset Sale made in compliance with Section 5.16;
(viii) Investment by the Company or a Wholly Owned Restricted Subsidiary of the
Company in a Receivables Subsidiary or any Investment by a Receivables
Subsidiary in any other Person in
-12-
connection with a Qualified Receivables Transaction; (ix) notes received from
management as payment for purchases of Capital Stock; and (x) additional
Investments by the Company or any Restricted Subsidiary of the Company in an
aggregate amount, based on original cost, not to exceed $1,000,000 at any one
time outstanding.
"Permitted Liens" means the following types of Liens:
(i) Liens for taxes, assessments or governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Company or its Restricted Subsidiaries
shall have set aside on its books such reserves as may be required pursuant
to GAAP;
(ii) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent or
being contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made in
respect thereof;
(iii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, including any Lien securing letters of
credit issued in the ordinary course of business consistent with past
practice in connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money);
(iv) judgment Liens not giving rise to an Event of Default so long as
such Lien is adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment shall not have
been finally terminated or the period within which such proceedings may be
initiated shall not have expired;
(v) easements, rights-of-way, zoning restrictions and other similar
charges or encumbrances in respect of real property not interfering in any
material respect with the ordinary conduct of the business of the Company
or any of its Restricted Subsidiaries;
(vi) any interest (including UCC filings) or title of a lessor under
any Capitalized Lease Obligation; PROVIDED that such Liens do not extend to
any property or assets which is not leased property subject to such
Capitalized Lease Obligation;
(vii) purchase money Liens to finance property or assets of the Company
or any Restricted Subsidiary of the Company acquired in the ordinary course
of business; PROVIDED, HOWEVER, that (A) the related purchase money
Indebtedness shall not exceed the cost of such property or assets and shall
not be secured by any property or assets of the Company or any Restricted
Subsidiary of the Company other than the property and assets so acquired
and (B) the Lien securing such Indebtedness shall be created within 90 days
of such acquisition.
-13-
(viii) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect of
bankers' acceptance issued or created for the account of such Person to
facilitate the purchase, shipment or storage of such inventory or other
goods;
(ix) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(x) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual, or warranty requirements or the Company
or any of its Restricted Subsidiaries, including rights of offset and
set-off;
(xi) Liens securing Interest Swap Obligations which Interest Swap
Obligations relate to Indebtedness that is otherwise permitted under this
Indenture;
(xii) Liens securing Indebtedness under Currency Agreements;
(xiii) Liens securing Acquired Indebtedness incurred in accordance with
Section 5.12; PROVIDED that (A) such Liens secured such Acquired
Indebtedness at the time of and prior to the incurrence of such Acquired
Indebtedness by the Company or a Restricted Subsidiary of the Company and
were not granted in connection with, or in anticipation of, the incurrence
of such Acquired Indebtedness by the Company or a Restricted Subsidiary of
the Company and (B) such Liens do not extend to or cover any property or
assets of the Company or of any of its Restricted Subsidiaries other than
the property or assets that secured the Acquired Indebtedness prior to the
time such Indebtedness became Acquired Indebtedness of the Company or a
Restricted Subsidiary of the Company and are no more favorable to the
lienholders than those securing the Acquired Indebtedness prior to the
incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary of the Company;
(xiv) Liens on accounts receivable and related assets of the type
described in the definition of "Qualified Receivables Transaction" or on
assets of a Receivables Subsidiary, in either case, incurred in connection
with a Qualified Receivables Transaction; and
(xv) Liens securing Indebtedness in an aggregate amount not to exceed
$5,000,000 at any one time outstanding.
"Person" means an individual, partnership, corporation, unincorporated
organization, trust or joint venture, limited liability company, or a
governmental agency or political subdivision thereof.
"Preferred Stock" of any Person means any Capital Stock of such Person
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.
-14-
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act, as interpreted by
the Company's chief financial officer or Board of Directors in consultation with
its independent certified public accountants.
"Prospectus" means the prospectus of the Company dated December __,
1997 relating to the Securities.
"Public Equity Offering" means an underwritten public offering of
Qualified Capital Stock of the Company, sold by the Company, after the Issue
Date pursuant to a registration statement filed with the Commission in
accordance with the Securities Act.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Qualified Receivables Transaction" means any transaction or series of
transactions that may be entered into by the Company or any of its Restricted
Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries
may sell, convey or otherwise transfer to (i) a Receivables Subsidiary (in the
case of a transfer by the Company or any of its Restricted Subsidiaries) and
(ii) any other Person (in the case of a transfer by a Receivables Subsidiary),
or may grant a security interest in, any accounts receivable (whether now
existing or arising in the future) of the Company or any of its Restricted
Subsidiaries, and any assets related thereto including, without limitation, all
collateral securing such accounts receivable, all contracts and all guarantees
or other obligations in respect of such accounts receivable, proceeds of such
accounts receivable and other assets which are customarily transferred or in
respect of which security interests are customarily granted in connection with
asset securitization transactions involving accounts receivable.
"Receivables Subsidiary" means a Wholly Owned Restricted Subsidiary of
the Company that engages in no activities other than in connection with the
financing of accounts receivable and that is designated by the Board of
Directors of the Company (as provided below) as a Receivables Subsidiary (a)
which has no Indebtedness or any other Obligations (contingent or otherwise)
which (i) is guaranteed by the Company or any other Restricted Subsidiary of the
Company (excluding guarantees of Obligations (other than the principal of, and
interest on, Indebtedness) pursuant to representations, warranties, covenants
and indemnities entered into in the ordinary course of business in connection
with a Qualified Receivables Transaction), (ii) is recourse to or obligates the
Company or any other Restricted Subsidiary of the Company in any way other than
pursuant to representations, warranties, covenants and indemnities entered into
in the ordinary course of business in connection with a Qualified Receivables
Transaction or (iii) subjects any property or asset of the Company or any other
Restricted Subsidiary of the Company, directly or indirectly, contingently or
otherwise, to the satisfaction thereof, other than pursuant to representations,
warranties, covenants and indemnities entered into in the ordinary course of
business in connection with a Qualified Receivables Transaction, (b) with which
neither the Company nor any other Restricted Subsidiary of the Company has any
material contract, agreement, arrangement or
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understanding other than on terms no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Company, other than fees payable in the ordinary
course of business in connection with servicing accounts receivable and (c) with
which neither the Company nor any other Restricted Subsidiary of the Company has
any obligation to maintain or preserve such Restricted Subsidiary's financial
condition or cause such Restricted Subsidiary to achieve certain levels of
operating results. Any such designation by the Board of Directors of the
Company shall be evidenced to the Trustee by filing with the Trustee a Board
Resolution of the Company giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
conditions.
"Record Date" means the record dates specified in the Securities;
provided, however, that if any such date is a Legal Holiday, the Record Date
shall be the first day immediately preceding such specified day that is not a
Legal Holiday.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
and Paragraph 5 of the Securities.
"Redemption Price," when used with respect to any Security to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
and Paragraph 5 of the Securities.
"Refinance" means, in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, pre-pay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "Refinanced" and "Refinancing"
shall have correlative meanings.
"Refinancing Indebtedness" means any Refinancing by the Company or any
Restricted Subsidiary of the Company of Indebtedness incurred in accordance with
Section 5.12 (other than pursuant to clause (ii), (iv), (v), (vi), (vii),
(viii), (ix), (xi) or (xii) of the definition of Permitted Indebtedness), in
each case that does not (1) result in an increase in the aggregate principal
amount of Indebtedness of such Person as of the date of such proposed
Refinancing (plus the amount of any premium required to be paid under the terms
of the instrument governing such Indebtedness and plus the amount of reasonable
expenses incurred by the Company in connection with such Refinancing) or (2)
create Indebtedness with (A) a Weighted Average Life to Maturity that is less
than the Weighted Average Life to Maturity of the Indebtedness being Refinanced
or (B) a final maturity earlier than the final maturity of the Indebtedness
being Refinanced; PROVIDED that (x) if such Indebtedness being Refinanced is
solely Indebtedness of the Company, then such Refinancing Indebtedness shall be
Indebtedness solely of the Company and (y) if such Indebtedness being Refinanced
is subordinate or junior to the Securities, then such Refinancing Indebtedness
shall be subordinate to the Securities at least to the same extent and in the
same manner as the Indebtedness being Refinanced.
"Registrar" shall have the meaning provided in Section 2.3.
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"Replacement Assets" shall have the meaning provided in Section
5.16(a).
"Representative" means the indenture trustee or other trustee, agent
or representative in respect of any Designated Senior Debt; PROVIDED that if,
and for so long as, any Designated Senior Debt lacks such a representative, then
the Representative for such Designated Senior Debt shall at all times constitute
the holders of a majority in outstanding principal amount of such Designated
Senior Debt in respect of any Designated Senior Debt.
"Restricted Subsidiary" of any Person means any Subsidiary of such
Person which is not an Unrestricted Subsidiary.
"Revolving Credit Facility" means one or more revolving credit
facilities under the Credit Agreement.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Company or a Restricted Subsidiary of any property,
whether owned by the Company or any Restricted Subsidiary at the Issue Date or
later acquired, which has been or is to be sold or transferred by the Company or
such Restricted Subsidiary to such Person or to any other Person from whom funds
have been or are to be advanced by such Person on the security of such Property.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Senior Debt" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on any
Indebtedness of the Company, whether outstanding on the Issue Date or thereafter
created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Securities. Without limiting the
generality of the foregoing, "Senior Debt" shall also include the principal of,
premium, if any, interest (including any interest accruing subsequent to the
filing of a petition of bankruptcy at the rate provided for in the documentation
with respect thereto, whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of (x) all monetary
obligations of every nature of the Company under the Credit Agreement,
including, without limitation, obligations to pay principal and interest,
reimbursement obligations under letters of credit, fees, expenses and
indemnities, (y) all Interest Swap Obligations and (z) all obligations under
Currency Agreements, in each case whether outstanding on the Issue Date or
thereafter incurred. Notwithstanding the foregoing, "Senior Debt" shall not
include (i) any Indebtedness of the Company to a Restricted Subsidiary of the
Company or any Affiliate of the Company or any of such Affiliate's Subsidiaries,
(ii) Indebtedness to, or guaranteed on behalf of, any shareholder, director,
officer or employee of the Company or any Restricted Subsidiary of the Company
(including, without limitation, amounts owed for compensation), (iii)
Indebtedness to trade creditors and other amounts incurred in connection with
obtaining goods, materials or services, (iv) Indebtedness represented
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by Disqualified Capital Stock, (v) any liability for federal, state, local or
other taxes owed or owing by the Company, (vi) Indebtedness (other than
Permitted Indebtedness) incurred in violation of this Indenture provisions set
forth under Section 5.12, (vii) Indebtedness which, when incurred and without
respect to any election under Section 1111(b) of Xxxxx 00, Xxxxxx Xxxxxx Code,
is without recourse to the Company and (viii) any Indebtedness which is, by its
express terms, subordinated in right of payment to any other Indebtedness of the
Company including, without limitation, the Company's $7.1 million 8%
Subordinated Convertible Note due December 31, 2004 held by Xxxxxx Equity
Capital Corporation or any transferee and the $1 million 9% Subordinated
Promissory Note held by the former stockholders of Oda Nursery, Inc. or any
transferee. The holders of any Indebtedness which by its terms expressly
provides that such Indebtedness is senior in right of payment to the Securities
shall be entitled to rely conclusively for purposes of determining that such
Indebtedness is not being incurred in violation of this Indenture upon a
certificate of the chief financial officer of the Company which demonstrates
that, as of the date of the most recently published financial statements of the
Company, such Indebtedness is permitted to be incurred by the terms of this
Indenture.
"Significant Subsidiary" shall have the meaning set forth in Rule
1.02(v) of Regulation S-X under the Securities Act.
"subsidiary" with respect to any Person, means (i) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (ii) any
other Person of which at least a majority of the voting interest under ordinary
circumstances is at the time, directly or indirectly, owned by such Person.
"Subsidiary" means any subsidiary of the Company.
"Surviving Entity" shall have the meaning provided in Section
6.1(a)(i).
"Term Loan Facility" means one or more term loan facilities under the
Credit Agreement.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb), as amended, as in effect on the date this Indenture is qualified
under the TIA, except as otherwise provided in Section 10.3.
"Trust Officer" means any officer of the Trustee assigned by the
Trustee to administer its corporate trust matters.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Unrestricted Subsidiary" of any Person means (i) any Subsidiary of
such Person that at the time of determination shall be or continue to be
designated an Unrestricted Subsidiary by the Board of Directors of such Person
in the manner provided below and (ii) any Subsidiary
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of an Unrestricted Subsidiary. The Board of Directors may designate any
Subsidiary (including any newly acquired or newly formed Subsidiary) to be an
Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, the Company or any other Subsidiary
of the Company that is not a Subsidiary of the Subsidiary to be so designated;
PROVIDED that (x) the Company certifies to the Trustee that the Company's
investment in such Unrestricted Subsidiary is a Permitted Investment or that
such designation complies with Section 5.3 and (y) each Subsidiary to be so
designated and each of its Subsidiaries has not at the time of designation, and
does not thereafter, create, incur, issue, assume, guarantee or otherwise become
directly or indirectly liable with respect to any Indebtedness pursuant to which
the lender has recourse to any of the assets of the Company or any of its
Restricted Subsidiaries. The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary only if (x) immediately after giving
effect to such designation, the Company is able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in compliance with
Section 5.12 and (y) immediately before and immediately after giving effect to
such designation, no Default or Event of Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced
to the Trustee by promptly filing with the Trustee a copy of the Board
Resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligations" means direct non-callable obligations
of, or non-callable obligations guaranteed by, the United States of America for
the payment of which guarantee or obligation the full faith and credit of the
United States is pledged.
"U.S. Legal Tender" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding aggregate principal amount of such Indebtedness into (b) the sum of
the total of the products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person means any
Restricted Subsidiary of such Person of which all the outstanding voting
securities (other than in the case of a foreign Restricted Subsidiary,
directors' qualifying shares or an immaterial amount of shares required to be
owned by other Persons pursuant to applicable law) are owned by such Person or
any Wholly Owned Restricted Subsidiary of such Person.
(xv)
Section 1.2. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
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"indenture securities" means the Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company or any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
(xv)
Section 1.3. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other
subdivision.
ARTICLE II.
THE SECURITIES
Section 1.2. Form and Dating.
The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A. The Securities may have notations,
legends or endorsements required by law, stock exchange rule or usage. The
Company and the Trustee shall approve the form of the Securities and any
notation, legend or endorsement on them. Each Security shall be dated the date
of its authentication.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and
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the Trustee, by their execution and delivery of this Indenture, expressly agree
to such terms and provisions and to be bound thereby.
Section 2.2 Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall attest to, the Securities for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for original issue in the
aggregate principal amount of $85,000,000 upon a written order of the Company in
the form of an Officers' Certificate. The Officers' Certificate shall specify
the amount of Securities to be authenticated and the date on which the
Securities are to be authenticated. Such Securities shall be in the form of one
or more Global Securities, which (i) shall represent, and shall be denominated
in an amount equal to the aggregate principal amount of, the outstanding
Securities, (ii) shall be registered in the name of the Depository for such
Global Security or Securities or its nominee, (iii) shall be delivered by the
Trustee to the Depository or pursuant to the Depository's instruction and (iv)
shall bear a legend substantially to the following effect: "Unless and until
this Global Security is exchanged in whole or in part for the individual
Securities represented hereby, this Global Security may not be transferred
except as a whole by the Depository to a nominee of the Depository or by a
nominee of the Depository to the Depository or by a Depository or any such
nominee to a successor Depository or a nominee of a successor Depository." The
aggregate principal amount of Securities outstanding at any time may not exceed
$85,000,000 (or such lesser amount as is requested authenticated by the Trustee
and issued by the Company on the Issue Date), except as provided in Section 2.7.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.
The Securities shall be issuable only in registered form without
coupons in denominations of $1,000 and integral multiples thereof.
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Section 2.3 Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, where (a) Securities may be presented or
surrendered for registration of transfer or for exchange ("Registrar"), (b)
Securities may be presented or surrendered for payment ("Paying Agent") and (c)
notices and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company may also from time to time designate one
or more other offices or agencies where the Securities 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 may act as its own Registrar or Paying Agent except that for the
purposes of Articles Three and Nine and Sections 5.15 and 5.16, neither the
Company nor any Affiliate of the Company shall act as Paying Agent. The
Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company, upon notice to the Trustee, may have one or more
co-Registrars and one or more additional paying agents reasonably acceptable to
the Trustee. The term "Paying Agent" includes any additional paying agent. The
Company initially appoints the Trustee as Registrar and Paying Agent until such
time as the Trustee has resigned or a successor has been appointed.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall
notify the Trustee, in advance, of the name and address of any such Agent. If
the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act
as such.
Section 2.4. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that, subject to Article Four, each Paying Agent shall hold in
trust for the benefit of Holders or the Trustee all assets held by the Paying
Agent for the payment of principal of, or interest on, the Securities (whether
such assets have been distributed to it by the Company or any other obligor on
the Securities), and shall notify the Trustee of any Default by the Company (or
any other obligor on the Securities) in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate such assets and hold
them as a separate trust fund, subject to Article Four. The Company at any time
may require a Paying Agent to distribute all assets held by it to the Trustee
and account for any assets disbursed and the Trustee may at any time during the
continuance of any payment Default, upon written request to a Paying Agent,
require such Paying Agent to distribute all assets held by it to the Trustee and
to account for any assets distributed. Upon distribution to the Trustee of all
assets that shall have been delivered by the Company to the Paying Agent, the
Paying Agent shall have no further liability for such assets.
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Section 2.5. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company shall furnish to the
Trustee on or before each Interest Payment Date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Holders, which list
may be conclusively relied upon by the Trustee.
Section 2.6. Transfer and Exchange.
(a) When Securities are presented to the Registrar or a
co-Registrar with a request to register the transfer of such Securities or to
exchange such Securities for an equal principal amount of Securities of other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transaction are met; provided, however, that the Securities surrendered for
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or his or her attorney duly
authorized in writing. To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities at the
Registrar's or co-Registrar's request. No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchanges or transfers pursuant to Sections
2.2, 2.7, 2.10, 3.6, 5.15, 5.16 or 10.5). The Registrar or co-Registrar shall
not be required to register the transfer of or exchange of any Security (i)
during a period beginning at the opening of business 15 days before the mailing
of a notice of redemption of Securities and ending at the close of business on
the day of such mailing and (ii) selected for redemption in whole or in part
pursuant to Article Three, except the unredeemed portion of any Security being
redeemed in part. A Global Security may be transferred, in whole but not in
part, in the manner provided in this Section 2.6(a), only to a nominee of the
Depository for such Global Security, or to the Depository, or a successor
Depository for such Global Security selected or approved by the Company, or to a
nominee of such successor Depository.
(b) If at any time the Depository for the Global Security or
Securities notifies the Company that it is unwilling or unable to continue as
Depository for such Global Security or Securities or the Company becomes aware
that the Depository has ceased to be a clearing agency registered under the
Exchange Act, the Company shall appoint a successor Depository with respect to
such Global Security or Securities. If a successor Depository for such Global
Security or Securities has not been appointed within 120 days after the Company
receives such notice or becomes aware of such ineligibility, the Company shall
execute, and the Trustee, upon receipt of an Officers' Certificate for the
authentication and delivery of Securities, shall authenticate and deliver,
Securities in definitive form, in an aggregate principal amount at maturity
equal to the principal amount at maturity of the Global Security representing
such Securities, in exchange for such Global Security. The Company shall
reimburse the Registrar, the Depository and the
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Trustee for expenses they incur in documenting such exchanges and issuances of
Securities in definitive form.
The Company may at any time and in its sole discretion determine that
the Securities shall no longer be represented by such Global Security or
Securities. In such event the Company will execute, and the Trustee, upon
receipt of a written order for the authentication and delivery of individual
Securities in exchange in whole or in part for such Global Security or
Securities, will authenticate and deliver individual Securities in definitive
form in an aggregate principal amount equal to the principal amount of such
Global Security or Securities in exchange for such Global Security or
Securities.
In any exchange provided for in any of the preceding two paragraphs,
the Company will execute and the Trustee will authenticate and deliver
individual Securities in definitive registered form in authorized
denominations. Upon the exchange of a Global Security for individual
Securities, such Global Security shall be cancelled by the Trustee.
Securities issued in exchange for a Global Security pursuant to this Section
2.6(b) shall be registered in such names and in such authorized denominations
as the Depository for such Global Security, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the Trustee.
The Trustee shall deliver such Securities to the persons in whose names such
Securities are so registered.
None of the Company, the Trustee, any Paying Agent or the Registrar
will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests of
a Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
Section 2.7. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the
Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate
a replacement Security if the Trustee's requirements are met. If required by
the Trustee or the Company, such Holder must provide an indemnity bond or
other indemnity, sufficient in the judgment of both the Company and the
Trustee, to protect the Company, the Trustee or any Agent from any loss which
any of them may suffer if a Security is replaced. The Company may charge
such Holder for its reasonable out-of-pocket expenses in replacing a Security
pursuant to this Section 2.7, including reasonable fees and expenses of
counsel.
Every replacement Security is an additional obligation of the Company.
Section 2.8. Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those cancelled by it, those
delivered to it for cancellation and those described in this Section as not
outstanding. A Security does not cease to be outstanding because the Company
or any of its respective Affiliates holds the Security.
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If a Security is replaced pursuant to Section 2.7 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section 2.7.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Company or a Subsidiary) holds U.S. Legal Tender or U.S. Government
Obligations sufficient to pay all of the principal and interest due on the
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest on them ceases to accrue unless, pursuant
to the provisions of Article Four, the Paying Agent is unable to make payments
on the Securities to the Holders thereof.
Section 2.9. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, the Subsidiaries or any of their respective Affiliates shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that the Trustee knows or has reason to know are so owned shall be
disregarded.
Section 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but
may have variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Securities in exchange for temporary
Securities. Until such exchange, temporary Securities shall be entitled to
the same rights, benefits and privileges as definitive Securities.
Notwithstanding the foregoing, so long as the Securities are represented by a
Global Security, such Global Security may be in typewritten form.
Section 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent (other than the Company or a Subsidiary), and no one else, shall cancel
and, at the written direction of the Company, shall dispose of all Securities
surrendered for transfer, exchange, payment or cancellation. Subject to
Section 2.7, the Company may not issue new Securities to replace Securities
that it has paid or delivered to the Trustee for cancellation. If the
Company shall acquire any of the Securities, such acquisition shall not
operate as a redemption or satisfaction of the Indebtedness represented by
such Securities unless and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.11.
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Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, it
shall, unless the Trustee fixes another record date pursuant to Section 7.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest, to the persons who are Holders on a subsequent special
record date, which date shall be the fifteenth day next preceding the date fixed
by the Company for the payment of defaulted interest or the next succeeding
Business Day if such date is not a Business Day. At least 15 days before the
subsequent special record date, the Company shall mail to each Holder, with a
copy to the Trustee, a notice that states the subsequent special record date,
the payment date and the amount of defaulted interest, and interest payable on
such defaulted interest, if any, to be paid.
Section 2.13. CUSIP Number.
The Company in issuing the Securities may use a "CUSIP" number, and if
so, the Trustee shall use the CUSIP number in notices of redemption or exchange
as a convenience to Holders; provided, however, that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Securities, and that reliance may be
placed only on the other identification numbers printed on the Securities.
ARTICLE III.
REDEMPTION
Section 3.1. Notices to Trustee.
If the Company elects to redeem Securities pursuant to Paragraph 5 of
the Securities, it shall notify the Trustee, with a copy to the Credit Agent, of
the Redemption Date and the principal amount of Securities to be redeemed and
whether it wants the Trustee to give notice of redemption to the Holders at
least 30 days (unless a shorter notice shall be satisfactory to the Trustee) but
not more than 60 days before the Redemption Date. Any such notice may be
cancelled at any time prior to notice of such redemption being mailed to any
Holder and shall thereby be void and of no effect.
Section 3.2. Selection of Securities To Be Redeemed.
If fewer than all of the Securities are to be redeemed, the Trustee
shall select the Securities to be redeemed pro rata, by lot or by any other
method that the Trustee considers fair and appropriate and, if such Securities
are listed on any securities exchange, by a method that complies with the
requirements of such exchange; provided, however, that any redemption pursuant
to Paragraph 5 of the Securities with the proceeds of a Public Equity Offering
shall be made on a pro rata basis or on as nearly a pro rata basis as is
practicable (subject to Depository procedures), unless such method is otherwise
prohibited.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
in writing of the
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Securities selected for redemption and, in the case of any Security selected for
partial redemption, the principal amount thereof to be redeemed. Securities in
denominations of $1,000 may be redeemed only in whole. The Trustee may select
for redemption portions (equal to $1,000 or integral multiples thereof) of the
principal amount of Securities that have denominations larger than $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption.
Section 3.3. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first class mail to each Holder
whose Securities are to be redeemed at such Holder's registered address, with a
copy to the Trustee and the Credit Agent. In order to effect a redemption
pursuant to Paragraph 5 of the Securities with the proceeds of a Public Equity
Offering, the Company shall send the redemption notice not later than 120 days
after the consummation of such Public Equity Offering. At the Company's
request, the Trustee shall give the notice of redemption in the Company's name
and at the Company's expense. Each notice for redemption shall identify the
Securities to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(5) that, unless (a) the Company defaults in making the redemption
payment on the Redemption Date or (b) such redemption payment is prohibited
pursuant to Article Four or otherwise, interest on Securities called for
redemption ceases to accrue on and after the Redemption Date, and the only
remaining right of the Holders of such Securities is to receive payment of the
Redemption Price upon surrender to the Paying Agent of the Securities redeemed;
(6) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the Redemption
Date, and upon surrender of such Security, a new Security or Securities in
aggregate principal amount equal to the unredeemed portion thereof will be
issued; and
(7) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be redeemed,
as well as the aggregate principal amount of Securities to be redeemed and the
aggregate principal amount of Securities to be outstanding after such partial
redemption.
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Section 3.4. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.3,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price. Upon surrender to the Trustee or Paying Agent,
such Securities called for redemption shall be paid at the Redemption Price
unless prohibited pursuant to Article Four or otherwise pursuant to this
Indenture. Securities that are redeemed by the Company or that are purchased by
the Company pursuant to a Net Proceeds Offer as described in Section 5.16 or
pursuant to a Change of Control Offer as described in Section 5.15 or that are
otherwise acquired by the Company will be surrendered to the Trustee for
cancellation.
Section 3.5. Deposit of Redemption Price.
On or before 11:00 a.m. New York City time on the Redemption Date, the
Company shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Redemption Price of all Securities to be redeemed on that date (other than
Securities or portions thereof called for redemption on that date which have
been delivered by the Company to the Trustee for cancellation). The Paying
Agent shall promptly return to the Company any U.S. Legal Tender so deposited
which is not required for that purpose upon the written request of the Company,
except with respect to monies owed as obligations to the Trustee pursuant to
Article Eight.
If the Company complies with the preceding paragraph and payment of
the Securities called for redemption is not prohibited under Article Four or
otherwise, then, unless the Company defaults in the payment of such Redemption
Price, interest on the Securities or portions thereof to be redeemed will cease
to accrue on and after the applicable Redemption Date, whether or not such
Securities are presented for payment.
Section 3.6. Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part, the
Trustee shall authenticate for the Holder a new Security or Securities equal in
principal amount to the unredeemed portion of the Security surrendered.
ARTICLE IV.
SUBORDINATION
Section 4.1. Securities Subordinated to Senior Debt.
Anything herein to the contrary notwithstanding, the Company, for
itself and its successors, and each Holder, by his or her acceptance of
Securities, agrees that the payment of the Obligations on the Securities is
subordinated, to the extent and in the manner provided in this Article Four, to
the prior payment in full in cash or Cash Equivalents of all Senior Debt,
whether outstanding on the Issue Date or thereafter Incurred, including with
respect to Designated Senior Debt, any interest accruing thereon subsequent to
the occurrence of any Event of Default
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specified in clauses (vi) or (vii) of Section 7.1 relating to the Company,
whether or not such interest is an allowed claim enforceable against the Company
under any Bankruptcy Law.
This Article Four shall constitute a continuing offer to all persons
who become holders of, or continue to hold, Senior Debt, and such provisions are
made for the benefit of the holders of Senior Debt and such holders are made
obligees hereunder and any one or more of them may enforce such provisions.
The obligations of the Company to the Trustee under Section 8.7 shall
not be subject to the provisions of this Article Four.
Section 4.2 Suspension of Payment When Senior Debt in Default.
(a) Unless Section 4.3 shall be applicable, no direct or indirect
payment (other than payments by a trust previously established pursuant to
Article Nine) or distribution of any asset of the Company of any kind or
character by or on behalf of the Company of Obligations on the Securities or on
account of the purchase or redemption or other acquisition of the Securities
whether pursuant to the terms of the Securities or upon acceleration or
otherwise shall be made if, at the time of such payment or distribution, there
exists a default in the payment of all or any portion of principal of, premium,
if any, or interest on any Designated Senior Debt and such default shall not
have been cured or waived by or on behalf of the holders of such Designated
Senior Debt or shall have ceased to exist, until such default shall have been
cured or waived or shall have ceased to exist or such Designated Senior Debt
shall have been discharged or paid in full in cash or Cash Equivalents, after
which the Company shall resume making any and all required payments in respect
of the Securities, including any missed payments.
(b) Unless Section 4.3 shall be applicable, during the continuance of
any other event of default with respect to any Designated Senior Debt pursuant
to which the maturity thereof may be accelerated, upon the earlier to occur of
(a) receipt by the Trustee of written notice from the holders of a majority of
the outstanding principal amount of the Designated Senior Debt or their
Representative stating that such notice is a notice pursuant to Section 4.2 of
this Indenture, or (b) if such event of default results from the acceleration of
the Securities, the date of such acceleration, no such payment (other than
payments by a trust previously established pursuant to Article Nine) or
distribution of any asset of the Company of any kind or character shall be made
by the Company upon or in respect of the Securities (including without
limitation on account of any principal of, premium, if any, or interest on the
Securities) or on account of the purchase or redemption or other acquisition of
Securities for a period ("Payment Blockage Period") commencing on the earlier of
the date of receipt of such notice or the date of such acceleration and ending
180 days thereafter (provided such Designated Senior Debt shall theretofore not
have been accelerated) (unless (x) such Payment Blockage Period shall be
terminated by written notice to the Trustee from the holders of a majority of
the outstanding principal amount of such Designated Senior Debt or their
Representative who delivered such notice or (y) such default is cured or waived,
or ceases to exist or such Designated Senior Debt is discharged or paid in full
in cash or Cash Equivalents), after which the Company shall promptly notify the
Trustee of such cure or waiver and resume making any and all required payments
in
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respect of the Securities, including any missed payments. Notwithstanding
anything herein to the contrary, in no event will a Payment Blockage Period
extend beyond 180 days from the date on which such Payment Blockage Period was
commenced. Not more than one Payment Blockage Period may be commenced with
respect to the Securities during any period of 360 consecutive days. No event
of default which existed or was continuing on the date of the commencement of
any Payment Blockage Period with respect to the Designated Senior Debt
initiating such Payment Blockage Period shall be, or be made, the basis for the
commencement of a second Payment Blockage Period by the holders of such
Designated Senior Debt or their Representative whether or not within a period of
360 consecutive days unless such event of default shall have been cured or
waived for a period of not less than 90 consecutive days (it being acknowledged
that any subsequent action, or any breach of any financial covenants for a
period commencing after the date of commencement of such Blockage Period that,
in either case, would give rise to an event of default pursuant to any
provisions under which an event of default previously existed or was continuing
shall constitute a new event of default for this purpose).
(c) In the event that, notwithstanding the foregoing, the Trustee or
a Holder shall have received any payment prohibited by the foregoing provisions
of this Section 4.2, then and in such event such payment shall be paid over and
delivered forthwith to the Representative or as a court of competent
jurisdiction shall direct.
Section 4.3. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company.
Upon any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, upon any dissolution,
winding-up, total or partial liquidation or reorganization of the Company
(including, without limitation, in bankruptcy, insolvency or receivership
proceedings or upon any assignment for the benefit of creditors or any other
marshalling of the Company's assets and liabilities and whether voluntary or
involuntary):
(a) the holders of Senior Debt shall first be entitled to receive
payments in full in cash or Cash Equivalents, or such payment duly provided for
to the satisfaction of the holders of Senior Debt, of all amounts payable under
Senior Debt before the Holders will be entitled to receive any payment with
respect to the Securities, or for the acquisition of any of the Securities for
cash or property or otherwise;
(b) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to which the Holders or
the Trustee on behalf of the Holders would be entitled except for the provisions
of this Article Four, shall be paid by the liquidating trustee or agent or other
person making such a payment or distribution, directly to the holders of Senior
Debt or their Representative, ratably according to the respective amounts of
Senior Debt remaining unpaid held or represented by each, until all Senior Debt
remaining unpaid shall have been paid in full in cash or Cash Equivalents after
giving effect to any concurrent payment or distribution to the holders of such
Senior Debt; and
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(c) in the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or the Holders or any
Paying Agent on account of principal of, premium, if any, or interest on the
Securities before all Senior Debt is paid in full in cash or Cash Equivalents,
such payment or distribution (subject to the provisions of Sections 4.6 and 4.7)
shall be received, segregated from other funds, and held in trust by the Trustee
or such Holder or Paying Agent for the benefit of, and shall immediately be paid
over to, the holders of Senior Debt or their Representative, ratably according
to the respective amounts of Senior Debt held or represented by each, until all
Senior Debt remaining unpaid shall have been paid in full in cash or Cash
Equivalents, after giving effect to any concurrent payment or distribution to or
for the holders of Senior Debt. Notwithstanding anything to the contrary
contained herein, in the absence of its gross negligence or willful misconduct,
the Trustee shall have no duty to collect or retrieve monies previously paid by
it in good faith; provided, however, that this sentence shall not affect the
obligation of any other party receiving such payment to hold such payment for
the benefit of, and to pay over such payment over to, the holders of Senior Debt
or their Representative.
The consolidation of the Company with, or the merger of the Company
with or into, another person or the liquidation or dissolution of the Company
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another person upon the terms and conditions set
forth in Article Six shall not be deemed a dissolution, winding-up, liquidation,
reorganization, assignment for the benefit of creditors or marshaling of assets
and liabilities of the Company for the purposes of this Article Four if the
person formed by such consolidation or the surviving entity of such merger or
the person which acquires by conveyance, transfer or lease such properties and
assets substantially as an entirety, as the case may be, shall, as a part of
such consolidation, merger, conveyance, transfer or lease, comply with the
conditions set forth in such Article Six.
The Company shall give prompt notice to the Trustee prior to any
dissolution, winding-up, total or partial liquidation or reorganization
(including, without limitation, in bankruptcy, insolvency, or receivership
proceedings or upon any assignment for the benefit of creditors or any other
marshalling of the Company's assets and liabilities).
Section 4.4. Holders To Be Subrogated to Rights of Holders of Senior Debt.
Subject to the payment in full in cash or Cash Equivalents of all
Senior Debt, Holders shall be subrogated to the rights of the holders of Senior
Debt to receive payments or distributions of assets of the Company applicable to
the Senior Debt until all amounts owing on the Securities shall be paid in full
in cash, and for the purpose of such subrogation no payments or distributions to
the holders of Senior Debt by or on behalf of the Company, or by or on behalf of
the Holders by virtue of this Article Four, which otherwise would have been made
to the Holders, shall, as between the Company and the Holders, be deemed to be
payment by the Company to or on account of the Senior Debt, it being understood
that the provisions of this Article Four are and are intended solely for the
purpose of defining the relative rights of the Holders, on the one hand, and the
holders of Senior Debt, on the other hand.
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If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article Four shall have been
applied, pursuant to the provisions of this Article Four, to the payment of all
amounts payable under the Senior Debt, then the Holders shall be entitled to
receive from the holders of such Senior Debt any payments or distributions
received by such holders of Senior Debt in excess of the amount sufficient to
pay all amounts payable under or in respect of the Senior Debt in full in cash
or Cash Equivalents.
Section 4.5. Obligations of the Company Unconditional.
Nothing contained in this Article Four or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company and
the Holders, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders the principal of and interest on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of the Senior Debt, nor shall anything herein
or therein prevent the Trustee or any Holder from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article Four, of the holders of Senior Debt in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy. Upon any payment or distribution of assets or
securities of the Company referred to in this Article Four, the Trustee, subject
to the provisions of Sections 8.1 and 8.2, and the Holders shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction in
which any dissolution, winding-up, liquidation or reorganization proceedings are
pending, or a certificate of the receiver, trustee in bankruptcy, liquidating
trustee or agent or other person making any payment or distribution to the
Trustee or to the Holders for the purpose of ascertaining the persons entitled
to participate in such payment or distribution, the holders of Senior Debt 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 Four. Nothing in this Section 4.5 shall apply to the
claims of, or payments to, the Trustee under or pursuant to Section 8.7.
Section 4.6. Trustee Entitled To Assume Payments Not Prohibited in Absence of
Notice.
The Trustee shall not at any time be charged with knowledge of the
existence of any facts that would prohibit the making of any payment to or by
the Trustee unless and until the Trustee shall have received written notice
thereof from the Company or from one or more holders of Senior Debt or from any
Representative therefor and, prior to the receipt of any such notice, the
Trustee, subject to the provisions of Sections 8.1 and 8.2, shall be entitled in
all respects conclusively to assume that no such fact exists.
Section 4.7. Application by Trustee of Assets Deposited with It.
U.S. Legal Tender or U.S. Government Obligations deposited in trust
with the Trustee pursuant to and in accordance with Section 9.2 shall be for the
sole benefit of Holders and, to the extent allocated for the payment of
Securities, shall not be subject to the subordination provisions of this Article
Four. Otherwise, any deposit of assets or securities by or
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on behalf of the Company with the Trustee or any Paying Agent (whether or not in
trust) for the payment of principal of or interest on any Securities shall be
subject to the provisions of this Article Four; provided, however, that if prior
to the second Business Day preceding the date on which by the terms of this
Indenture any such assets may become distributable for any purpose (including,
without limitation, the payment of principal of or premium or interest on any
Security) the Trustee or such Paying Agent shall not have received with respect
to such assets the notice provided for in Section 4.6, then the Trustee or such
Paying Agent shall have full power and authority to receive such assets and to
apply the same to the purpose for which they were received, and shall not be
affected by any notice to the contrary received by it on or after such date.
The foregoing shall not apply to the Paying Agent if the Company or any
Subsidiary or Affiliate of the Company is acting as Paying Agent. Nothing
contained in this Section 4.7 shall limit the right of the holders of Senior
Debt to recover payments as contemplated by this Article Four.
Section 4.8. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Debt 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
non-compliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.
(b) Without limiting the generality of subsection (a) of this Section
4.8, the holders of Senior Debt may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article Four or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (1)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding; (2) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Debt; (3) release any person liable in any manner for the collection or payment
of Senior Debt; and (4) exercise or refrain from exercising any rights against
the Company and any other person; provided, however, that in no event shall any
such actions limit the right of the Holders to take any action to accelerate the
maturity of the Securities pursuant to Article Seven or to pursue any rights or
remedies hereunder or under applicable laws if the taking of such action does
not otherwise violate the terms of this Indenture.
(c) Each Holder by accepting a Security agrees that the
Representative of any Senior Debt (including, without limitation, the Credit
Agent), in its discretion, without notice or demand and without affecting any
rights of any holder of Senior Debt under this Article Four, may foreclose any
mortgage or deed of trust covering interests in real property secured thereby,
by judicial or nonjudicial sale; and such Holder hereby waives any defense to
the enforcement by the Representative of any Senior Debt (including, without
limitation, the Credit Agent) or by any holder of any Senior Debt against such
Holder of this Article Four after a judicial or nonjudicial
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sale or other disposition of its interests in real property secured by such
mortgage or deed of trust; and such Holder expressly waives any defense or
benefits that may be derived from comparable provisions of the laws of any
jurisdiction or any similar statute in effect in any jurisdiction.
Section 4.9. Holders Authorize Trustee To Effectuate Subordination of
Securities.
Each Holder by his or her acceptance of a Security authorizes and
expressly directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to effect the subordination provisions contained in
this Article Four, and appoints the Trustee his or her attorney-in-fact for such
purpose, including, in the event of any dissolution, winding-up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company) tending towards
liquidation or reorganization of the business and assets of the Company, the
immediate filing of a claim for the unpaid balance of such Holder's Securities
in the form required in said proceedings and cause said claim to be approved. If
the Trustee does not file a proper claim or proof of debt in the form required
in such proceeding prior to 30 days before the expiration of the time to file
such claim or claims, then the holders of the Senior Debt or their
Representative is hereby authorized to file an appropriate claim for and on
behalf of the Holders. Nothing herein contained shall be deemed to authorize
the Trustee or the holders of Senior Debt or their Representative to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee or the holders
of Senior Debt or their Representative to vote in respect of the claim of any
Holder in any such proceeding.
Section 4.10. Right of Trustee To Hold Senior Debt.
The Trustee shall be entitled to all of the rights set forth in this
Article Four in respect of any Senior Debt at any time held by it to the same
extent as any other holder of Senior Debt, and nothing in this Indenture shall
be construed to deprive the Trustee of any of its rights as such holder.
Section 4.11. No Suspension of Remedies.
The failure to make a payment on account of principal of or interest
on the Securities by reason of any provision of this Article Four shall not be
construed as preventing the occurrence of a Default or an Event of Default under
Section 7.1.
Nothing contained in this Article Four shall limit the right of the
Trustee or the Holders to take any action to accelerate the maturity of the
Securities pursuant to Article Seven or to pursue any rights or remedies
hereunder or under applicable law, subject to the rights, if any, under this
Article Four of the holders, from time to time, of Senior Debt.
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Section 4.12. No Fiduciary Duty of Trustee to Holders of Senior Debt.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt, and shall not be liable to any such holders (other than
for its willful misconduct or gross negligence) if it shall in good faith
mistakenly pay over or deliver to the Holders or the Company or any other
person, money or assets to which any holders of Senior Debt shall be entitled by
virtue of this Article Four or otherwise. Nothing in this Section 4.12 shall
affect the obligation of any person other than the Trustee to hold such payment
for the benefit of, and to pay such payment over to, the holders of Senior Debt
or their Representative.
ARTICLE V.
COVENANTS
Section 5.1. Payment of Securities.
The Company shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities. An installment of
principal of or interest on the Securities shall be considered paid on the date
it is due if the Trustee or Paying Agent (other than the Company or a
Subsidiary) holds on that date U.S. Legal Tender designated for and sufficient
to pay the installment; provided, however, that U.S. Legal Tender held by the
Trustee for the benefit of holders of Senior Debt or the payment of which to the
Holders is prohibited pursuant to the provisions of Article Four or otherwise
shall not be considered to be designated for the payment of any installment of
principal or interest on the Securities within the meaning of this Section 5.1.
The Company shall pay interest on overdue principal at the rate borne
by the Securities and it shall pay interest on overdue installments of interest
at the same rate, to the extent lawful.
Section 5.2. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City
of New York, the office or agency required under Section 2.3. The Company shall
give prior 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 address of the Trustee set forth in Section 11.2.
Section 5.3. Limitation on Restricted Payments.
(a) The Company will not, and will not cause or permit any of
its Restricted Subsidiaries to, directly or indirectly, (a) declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Qualified Capital Stock of the Company) on or in respect of shares of the
Company's Capital Stock to holders of such Capital Stock, (b) purchase, redeem
or otherwise acquire or retire for value any Capital Stock of the Company
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or any warrants, rights or options to purchase or acquire shares of any class of
such Capital Stock, (c) make any principal payment on, purchase, defease,
redeem, prepay, decrease or otherwise acquire or retire for value, prior to any
scheduled final maturity, scheduled repayment or scheduled sinking fund payment,
any Indebtedness of the Company that is subordinate or junior in right of
payment to the Securities or (d) make any Investment (other than Permitted
Investments) (each of the foregoing actions set forth in clauses (a), (b), (c)
and (d) being referred to as a "Restricted Payment"), if at the time of such
Restricted Payment or immediately after giving effect thereto, (i) a Default of
an Event of Default shall have occurred and be continuing or (ii) the Company is
not able to incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) in compliance with the proviso in Section 5.12 or
(iii) the aggregate amount of Restricted Payments (including such proposed
Restricted Payment) made subsequent to the Issue Date (the amount expended for
such purposes, if other than in cash, being the fair market value of such
property as determined reasonably and in good faith by the Board of Directors of
the Company) shall exceed the sum of: (w) 50% of the cumulative Consolidated
Net Income (or if cumulative Consolidated Net Income shall be a loss, minus 100%
of such loss) of the Company earned subsequent to the Issue Date and on or prior
to the date the Restricted Payment occurs (the "Reference Date") (treating such
period as a single accounting period); plus (x) 100% of the aggregate net cash
proceeds received by the Company from any Person (other than a Subsidiary) from
the issuance and sale subsequent to the Issue Date and on or prior to the
Reference Date of Qualified Capital Stock of the Company (excluding net cash
proceeds received from the sale of Capital Stock to employees of the Company and
any of its Subsidiaries after the Issue Date to the extent such amounts have
been applied in accordance with clause (4) of the following paragraph); plus
(y) without duplication of any amounts included in clause (iii) (x) above, 100%
of the aggregate net cash proceeds of any equity contribution received by the
Company from a holder of the Company's Capital Stock (excluding, in the case of
clauses (iii) (x) and (y), any net cash proceeds from a Public Equity Offering
to the extent used to redeem the Securities); plus (z) aggregate net cash
proceeds received by the Company or any of its Subsidiaries as a distribution or
repayment with respect to, or from the sale of, Investments (other than
Permitted Investments) made after the Issue Date up to the original amount of
such Investments.
(b) Notwithstanding the foregoing, the provisions set forth in
the immediately preceding paragraph do not prohibit: (1) the payment of any
dividend within 60 days after the date of declaration of such dividend if the
dividend would have been permitted on the date of declaration; (2) if no Default
or Event of Default shall have occurred and be continuing, the acquisition of
any shares of Capital Stock of the Company, either (i) solely in exchange for
shares of Qualified Capital Stock of the Company or (ii) through the application
of net proceeds of a substantially concurrent sale for cash (other than to a
Subsidiary) of shares of Qualified Capital Stock of the Company; (3) if no
Default or Event of Default shall have occurred and be continuing, the
acquisition of any Indebtedness of the Company that is subordinate or junior in
right of payment to the Securities either (i) solely in exchange for shares of
Qualified Capital Stock of the Company, or (ii) through the application of net
proceeds of a substantially concurrent sale for cash (other than to a
Subsidiary) of (A) shares of Qualified Capital Stock of the Company or
(B) Refinancing Indebtedness; (4) so long as no Default or Event of Default
shall have occurred and be continuing, repurchases by the Company of Capital
Stock of the
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Company from employees of the Company or any of its Subsidiaries or their
authorized representatives upon the death, disability or termination of
employment of such employees or pursuant to a written contract or plan or
pursuant to a put/call arrangement covering 20,211 shares of Common Stock in
existence on the Issue Date, in an aggregate amount not to exceed $1,000,000 in
any calendar year plus an aggregate amount of net cash proceeds received by the
Company subsequent to the Issue Date from the sale of Capital Stock to employees
of the Company and any of its Subsidiaries to the extent such proceeds have not
been included in making the calculation in clause (iii) of the immediately
preceding paragraph; (5) so long as no Default or Event of Default shall have
occurred and be continuing, the payment of cash dividends on the Series A
Preferred Stock commencing with the first payment due after ____________, 2002;
and (6) so long as no Default or Event of Default shall have occurred and be
continuing, the repurchase of Series A Preferred Stock after a Change of
Control; PROVIDED that the Company has completed the Change of Control Offer.
In determining the aggregate amount of Restricted Payments made subsequent to
the Issue Date in accordance with clause (iii) of the immediately preceding
paragraph, amounts expended pursuant to clauses (1), (2), (4) and (5) shall be
included in such calculation.
Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment complies with this Indenture and setting forth in reasonable
detail the basis upon which the required calculations were computed, which
calculations may be based upon the Company's latest available internal quarterly
financial statements.
Section 5.4. Corporate Existence.
Except as otherwise permitted by Article Six, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and the rights (charter and statutory) and
franchises of the Company; provided, however, that the Company shall not be
required to preserve, with respect to itself, any right or franchise, if the
Board of Directors of the Company, as the case may be, shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company.
Section 5.5. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon it or any of the Restricted
Subsidiaries or properties of it or any of the Restricted Subsidiaries and (ii)
all lawful claims for labor, materials and supplies that, if unpaid, might by
law become a Lien upon the property of it or any of the Restricted 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 if
either (a) the amount, applicability or validity thereof is being contested in
good faith by appropriate proceedings and an adequate reserve has been
established therefor to the extent required by GAAP or (b) the failure to make
such payment or effect such discharge (together with all other such failures)
would not have a material adverse effect on the
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financial condition or results or operations of the Company and the Restricted
Subsidiaries taken as a whole.
Section 5.6. Maintenance of Properties and Insurance.
(a) The Company shall cause all properties used or useful to the
conduct of its business or the business of any of the Restricted Subsidiaries to
be maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in its
judgment may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times unless the
failure to so maintain such properties (together with all other such failures)
would not have a material adverse effect on the financial condition or results
of operations of the Company and the Restricted Subsidiaries taken as a whole;
provided, however, that nothing in this Section 5.6 shall prevent the Company or
any Restricted Subsidiary from discontinuing the operation or maintenance of any
of such properties, or disposing of any of them, if such discontinuance or
disposal is either (i) in the ordinary course of business, (ii) in the good
faith judgment of the Board of Directors of the Company or the Restricted
Subsidiary concerned, or of the senior officers of the Company or such
Restricted Subsidiary, as the case may be, desirable in the conduct of the
business of the Company or such Restricted Subsidiary, as the case may be, or
(iii) is otherwise permitted by this Indenture.
(b) The Company shall provide or cause to be provided, for
itself and each of the Restricted Subsidiaries, insurance (including appropriate
self-insurance) against loss or damage of the kinds that, in the reasonable,
good faith opinion of the Company are adequate and appropriate for the conduct
of the business of the Company and the Restricted Subsidiaries in a prudent
manner, with reputable insurers or with the government of the United States of
America or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as shall be either (i) consistent with past
practices of the Company or the applicable Restricted Subsidiary or (ii)
customary, in the reasonable, good faith opinion of the Company, for
corporations similarly situated in the industry, unless the failure to provide
such insurance (together with all other such failures) would not have a material
adverse effect on the financial condition or results of operations of the
Company and the Restricted Subsidiaries, taken as a whole.
Section 5.7. Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee within 120 days after
the end of the Company's fiscal year an Officers' Certificate stating that a
review of its activities and the activities of the Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether it has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to each
such Officer signing such certificate, that to the best of his or her knowledge
the Company during such preceding fiscal year has kept, observed, performed and
fulfilled each and every such covenant and no event of default in respect of any
payment obligation under the Credit Agreement and no Default or Event of Default
occurred during such year or, if such signers do
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know of such an event of default, Default or Event of Default, the certificate
shall describe the event of default, Default or Event of Default and its status
with particularity. The Officers' Certificate shall also notify the Trustee
should the Company elect to change the manner in which it fixes its fiscal year
end.
(b) So long as, and to the extent, not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
Company shall deliver to the Trustee within 120 days after the end of each
fiscal year a written statement by the Company's independent certified public
accountants stating (A) that their audit examination has included a review of
the terms of this Indenture and the Securities as they relate to accounting
matters, and (B) whether, in connection with their audit examination, any
Default has come to their attention and if such a Default has come to their
attention, specifying the nature and period of existence thereof.
(a) The Company shall deliver to the Trustee, forthwith upon becoming
aware, and in any event within 5 days after the occurrence, of (i) any Default
or Event of Default; (ii) any event of default in respect of any payment
obligation under the Credit Agreement or any event of default under any bond,
debenture, note, or other evidence of Indebtedness of the Company or any of the
Subsidiaries, or under any mortgage, indenture or other instrument, an Officers'
Certificate specifying with particularity such event.
Section 5.8. Compliance with Laws.
The Company shall comply, and shall cause each of the Restricted
Subsidiaries to comply, with all applicable statutes, rules, regulations, orders
and restrictions of the United States of America, all states and municipalities
thereof, and of any governmental department, commission, board, regulatory
authority, bureau, agency and instrumentality of the foregoing, in respect of
the conduct of their respective businesses and the ownership of their respective
properties, except such as are being contested in good faith and by appropriate
proceedings and except for such noncompliances as would not in the aggregate
have a material adverse effect on the financial condition or results of
operations of the Company and the Restricted Subsidiaries taken as a whole.
Section 5.9. SEC Reports.
The Company will deliver to the Trustee within 15 days after the
filing of the same with the Commission, copies of the quarterly and annual
reports and of the information, documents and other reports, if any, which the
Company is required to file with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act. Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
will file with the Commission, to the extent permitted, and provide the Trustee
and Holders with such annual reports and such information, documents and other
reports specified in Sections 13 and 15(d) of the Exchange Act. The Company
will also comply with the other provisions of TIA Section 314(a).
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Section 5.10. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company from paying all or any
portion of the principal of or interest on the Securities as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 5.11. Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with, or for the benefit of, any of its Affiliates (each an "Affiliate
Transaction"), other than (x) Affiliate Transactions permitted under paragraph
(b) below and (y) Affiliate Transactions on terms that are no less favorable
than those that might reasonably have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an Affiliate of
the Company or such Restricted Subsidiary. All Affiliate Transactions (and each
series of related Affiliate Transactions which are similar or part of a common
plan) involving aggregate payments or other property with a fair market value in
excess of $1,000,000 shall be approved by the Board of Directors of the Company
or such Restricted Subsidiary, as the case may be, such approval to be evidenced
by a Board Resolution stating that such Board of Directors has determined that
such transaction complies with the foregoing provisions. If the Company or any
Restricted Subsidiary of the Company enters into an Affiliate Transaction (or a
series of related Affiliate Transactions related to a common plan) that involves
an aggregate fair market value of more than $5,000,000, the Company or such
Restricted Subsidiary, as the case may be, shall, prior to the consummation
thereof, obtain a favorable opinion as to the fairness of such transaction or
series of related transactions to the Company or the relevant Restricted
Subsidiary, as the case may be, from a financial point of view, from an
Independent Financial Advisor and file the same with the Trustee.
(b) The restrictions set forth in clause (a) shall not apply to (i)
reasonable fees and compensation paid to and indemnity provided on behalf of,
officers, directors, employees or consultants of the Company or any Restricted
Subsidiary of the Company (including customary provisions contained in
employment agreements with executive officers of the Company) as determined in
good faith by the Company's Board of Directors or senior management; (ii)
transactions exclusively between or among the Company and any of its Wholly
Owned Restricted Subsidiaries or exclusively between or among such Wholly Owned
Restricted Subsidiaries, provided such transactions are not otherwise prohibited
by this Indenture; (iii) any agreement as in effect as of the Issue Date or any
amendment thereto or any transaction
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contemplated thereby (including pursuant to any amendment thereto) in any
replacement agreement thereto so long as any such amendment or replacement
agreement is not more disadvantageous to the Holders in any material respect
than the original agreement as in effect on the Issue Date; (iv) Restricted
Payments permitted by Section 5.3; (v) the payments by the Company under that
certain lease of its Richmond, California facility between the Company and X. X.
Xxxxxxxx Co. dated as of December 1, 1995, as amended on December 13, 1995; and
(vi) the payments by the Company under that certain residential lease rental
agreement and deposit receipt between the Company and Xxxxxxx X. Xxxxxxxx, as
guardian of Xxxxxx Xxxxxxxx, dated as of December 13, 1995.
Section 5.12. Limitation on Incurrences of Additional Indebtedness.
The Company will not, and will not permit any of its Restricted
Subsidiaries to Incur any Indebtedness (other than Permitted Indebtedness);
PROVIDED, HOWEVER, that if no Default or Event of Default shall have occurred
and be continuing at the time of or as a consequence of the incurrence of any
such Indebtedness, the Company may incur Indebtedness (including, without
limitation, Acquired Indebtedness) and Restricted Subsidiaries of the Company
may incur Acquired Indebtedness, in each case if on the date of the Incurrence
of such Indebtedness, after giving effect to the incurrence thereof, the
Consolidated Fixed Charge Coverage Ratio of the Company is greater than 2.0 to
1.0.
Section 5.13. Limitation on Dividends and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
permit to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary of the Company to (a) pay dividends or make
any other distributions on or in respect of its Capital Stock; (b) make loans or
advances or to pay any Indebtedness or other obligation owed to the Company or
any other Restricted Subsidiary of the Company; or (c) transfer any of its
property or assets to the Company or any other Restricted Subsidiary of the
Company, except for such encumbrances or restrictions existing under or by
reason of: (1) applicable law; (2) this Indenture; (3) customary non-assignment
provisions of any contract or any lease governing a leasehold interest of any
Restricted Subsidiary of the Company; (4) any instrument governing Acquired
Indebtedness, which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired; (5) agreements existing on the
Issue Date to the extent and in the manner such agreements are in effect on the
Issue Date; (6) an agreement governing Indebtedness incurred to Refinance the
Indebtedness issued, assumed or incurred pursuant to an agreement referred to in
clause (2), (4) or (5) above; PROVIDED, HOWEVER, that the provisions relating to
such encumbrance or restriction contained in any such Indebtedness are no less
favorable to the Company in any material respect as determined by the Board of
Directors of the Company in their reasonable and good faith judgment than the
provisions relating to such encumbrance or restriction contained in agreements
referred to in such clause (2), (4) or (5); (7) Indebtedness or other
contractual requirements of a Receivables Subsidiary in connection with a
Qualified Receivables
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Transaction, provided that such restrictions apply only to such Receivables
Subsidiary; or (8) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions of the nature described in
clause (c) above on the property so acquired.
Section 5.14. Limitation on Liens.
The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
permit or suffer to exist any Liens of any kind against or upon any property or
assets of the Company or any of its Restricted Subsidiaries whether owned on the
Issue Date or acquired after the Issue Date, or any proceeds therefrom, or
assign or otherwise convey any right to receive income or profits therefrom
unless (i) in the case of Liens securing Indebtedness that is expressly
subordinate or junior in right of payment to the Securities, the Securities are
secured by Lien on such property, assets or proceeds that is senior in priority
to such Liens and (ii) in all other cases, the Securities are equally and
ratably secured, except for (A) Liens existing as of the Issue Date to the
extent and in the manner such Liens are in effect on the Issue Date; (B) Liens
securing Senior Debt; (C) Liens securing the Securities; (D) Liens of the
Company or a Wholly Owned Restricted Subsidiary of the Company on assets of any
Subsidiary of the Company; (E) Liens securing Refinancing Indebtedness which is
incurred to Refinance any Indebtedness which has been secured by a Lien
permitted under this Indenture and which has been incurred in accordance with
the provisions of this Indenture; PROVIDED, HOWEVER, that such Liens (A) are no
less favorable to the Holders and are not more favorable to the lienholders with
respect to such Liens than the Liens in respect of the Indebtedness being
Refinanced and (B) do not extend to or cover any property or assets of the
Company or any of its Restricted Subsidiaries not securing the Indebtedness so
Refinanced; and (F) Permitted Liens.
Section 5.15. Limitation on Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder will have
the right to require that the Company purchase all or a portion of such Holder's
Securities pursuant to the offer described below (the "Change of Control
Offer"), at a purchase price equal to 101% of the principal amount thereof plus
accrued interest to the date of purchase.
(b) No later than 30 days following the date upon which the Change of
Control occurred, the Company must send, by first class mail, a notice to each
Holder, with a copy to the Trustee, which notice shall govern the terms of the
Change of Control Offer. Notice of an event giving rise to a Change of Control
shall be given on the same date and in the same manner to all Holders. Such
notice shall state:
(1) that the Change of Control Offer is being made pursuant to
this Section 5.15 and that all Securities tendered will be accepted for
payment;
(2) the purchase price (including the amount of accrued
interest) and the purchase date (which shall be no earlier than 30 days nor
later than 45 days from the date such notice is mailed, other than as may be
required by law) (the "Change of Control Payment Date");
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(3) that any Security not tendered will continue to accrue
interest if interest is then accruing;
(4) that, unless (i) the Company defaults in making payment
therefor or (ii) such payment is prohibited pursuant to Article Four, any
Security accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Security completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the Business Day
prior to the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than two Business Days prior to the
Change of Control Payment Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the
Securities the Holder delivered for purchase and a statement that such Holder
is withdrawing his or her election to have such Security purchased;
(7) that Holders whose Securities are purchased only in part
will be issued new Securities equal in principal amount to the unpurchased
portions of the Securities surrendered; provided that each Security purchased
and each Security issued shall be in an original principal amount of $1,000
or integral multiples thereof;
(8) that each Change of Control Offer is required to remain
open for at least 20 Business Days or such longer period as may be required
by law and until 5:00 p.m. New York City time on the applicable Change of
Control Payment Date; and
(9) the circumstances and relevant facts regarding such Change
of Control.
(c) On or before the Change of Control Payment Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal
Tender sufficient to pay the purchase price of all Securities so tendered and
(iii) deliver to the Trustee Securities so accepted together with an Officers'
Certificate stating the Securities or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to the Holders of Securities so
accepted payment in an amount equal to the purchase price (and the Trustee shall
promptly authenticate and mail to such Holders new Securities equal in principal
amount to any unpurchased portion of the Securities surrendered provided that
each such new Security shall be in the principal amount of $1,000 or integral
multiples thereof) unless such payment is prohibited pursuant to Article Four or
otherwise. The Company will publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date. For purposes of this Section 5.15, the Trustee shall act as the Paying
Agent.
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(d) Notwithstanding the foregoing, prior to the mailing of the notice
of a Change of Control Offer referred to above, within 30 days following a
Change of Control, the Company shall either (i) repay in full and terminate all
commitments under Indebtedness under the Credit Agreement and all other Senior
Debt the terms of which require repayment upon a Change of Control or offer to
repay in full and terminate all such commitments under all Indebtedness under
the Credit Agreement and all such other Senior Debt and to repay the
Indebtedness owed to each lender which has accepted such offer, or (ii) obtain
the requisite consents under the Credit Agreement and all other Senior Debt to
permit the repurchase of the Securities as provided above. The Company shall
first comply with the covenant in the immediately preceding sentence before it
shall be required to repurchase Securities pursuant to the provisions described
above.
(e) The Company must comply with Rule 14e-1 under the Exchange Act
and other provisions of state and federal securities laws to the extent
applicable in connection with a Change of Control Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
this Section 5.15, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
the provisions of this Section 5.15 by virtue thereof.
Section 5.16. Limitation on Asset Sales.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Company or the
applicable Restricted Subsidiary, as the case may be, receives consideration at
the time of such Asset Sale at least equal to the fair market value of the
assets sold or otherwise disposed of (as determined in good faith by the
Company's Board of Directors), (ii) at least 70% of the consideration received
by the Company or the Restricted Subsidiary, as the case may be, from such Asset
Sale shall be in the form of cash or Cash Equivalents and is received at the
time of such disposition; and (iii) upon the consummation of an Asset Sale, the
Company shall apply, or cause such Restricted Subsidiary to apply, the Net Cash
Proceeds relating to such Asset Sale within 365 days of receipt thereof either
(A) to prepay any Senior Debt and, in the case of any Senior Debt under any
revolving credit facility, effect a permanent reduction in the availability
under such revolving credit facility, (B) to make an investment in a similar
business or properties or assets that replace the business, properties or assets
that were the subject of such Asset Sale or in properties and assets that will
be used in the business of the Company and its Restricted Subsidiaries as
existing on the Issue Date or in businesses reasonably related thereto
("Replacement Assets"), or (C) a combination of prepayment and investment
permitted by the foregoing clauses (iii)(A) and (iii)(B). On the 366th day
after an Asset Sale or such earlier date, if any, as the Board of Directors of
the Company or of such Restricted Subsidiary determines not to apply the Net
Cash Proceeds relating to such Asset Sale as set forth in clauses (iii)(A),
(iii)(B) and (iii)(C) of the next preceding sentence (each, a "Net Proceeds
Offer Trigger Date"), such aggregate amount of Net Cash Proceeds which have not
been applied on or before such Net Proceeds Offer Trigger Date as permitted in
clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a
"Net Proceeds Offer Amount") shall be applied by the Company or such Restricted
Subsidiary to make an offer to purchase (the "Net Proceeds Offer") on a date
(the "Net Proceeds Offer
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Payment Date") not less than 30 nor more than 45 days following the applicable
Net Proceeds Offer Trigger Date, from all Holders on a PRO RATA basis, that
amount of Securities equal to the Net Proceeds Offer Amount at a price equal to
100% of the principal amount of the Securities to be purchased, plus accrued and
unpaid interest thereon, if any, to the date of purchase; PROVIDED, HOWEVER,
that if at any time any non-cash consideration received by the Company or any
Restricted Subsidiary of the Company, as the case may be, in connection with any
Asset Sale is converted into or sold or otherwise disposed of for cash (other
than interest received with respect to any such non-cash consideration), then
such conversion or disposition shall be deemed to constitute an Asset Sale
hereunder and the Net Cash Proceeds thereof shall be applied in accordance with
this Section 5.16. The Company may defer the Net Proceeds Offer until there is
an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of
$5,000,000 resulting from one or more Asset Sales (at which time, the entire
unutilized Net Proceeds Offer Amount, and not just the amount in excess of
$5,000,000, shall be applied as required pursuant to this paragraph).
(b) In the event of the transfer of substantially all (but not all)
of the property and assets of the Company and its Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Section 6.1, the successor
corporation shall be deemed to have sold the properties and assets of the
Company and its Restricted Subsidiaries not so transferred for purposes of this
covenant, and shall comply with the provisions of this Section 5.16 with respect
to such deemed sale as if it were an Asset Sale. In addition, the fair market
value of such properties and assets of the Company or its Restricted
Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for
purposes of this Section 5.16.
(c) Notwithstanding Sections 5.16(a) and (b), the Company and its
Restricted Subsidiaries will be permitted to consummate an Asset Sale without
complying with such paragraphs to the extent (i) at least 70% of the
consideration for such Asset Sale constitutes Replacement Assets and (ii) such
Asset Sale is for fair market value; PROVIDED, that any consideration not
constituting Replacement Assets received by the Company or any of its Restricted
Subsidiaries in connection with any Asset Sale permitted to be consummated under
this paragraph shall constitute Net Cash Proceeds subject to the provisions of
the two preceding paragraphs.
(d) Each Net Proceeds Offer will be mailed to the record Holders as
shown on the register of Holders of such Securities within 25 days following the
Net Proceeds Offer Trigger Date, with a copy to the Trustee. The notice shall
contain all instructions and materials necessary to enable such Holders to
tender Securities pursuant to the Net Proceeds Offer and shall state the
following terms:
(1) that the Net Proceeds Offer is being made pursuant to
Section 5.16 and that all Securities tendered will be accepted for payment,
provided, however, that if the aggregate principal amount of Securities tendered
in a Net Proceeds Offer plus accrued interest at the expiration of such offer
exceeds the aggregate amount of the Net Proceeds Offer, the Company shall select
the Securities to be purchased on a pro rata basis (with such adjustments as
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may be deemed appropriate by the Company so that only Securities in
denominations of $1,000 or multiples thereof shall be purchased);
(2) the purchase price (including the amount of accrued
interest) and the Net Proceeds Offer Payment Date;
(3) that any Security not tendered will continue to accrue
interest if interest is then accruing;
(4) that, unless (i) the Company defaults in making payment
therefor or (ii) such payment is prohibited pursuant to Article Four or
otherwise, any Security accepted for payment pursuant to the Net Proceeds Offer
shall cease to accrue interest after the Net Proceeds Offer Payment Date;
(5) that Holders electing to have a Security purchased pursuant
to a Net Proceeds Offer will be required to surrender the Security, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the Business Day prior to the Net Proceeds
Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than two Business Days prior to the Net
Proceeds Offer Payment Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the Securities the
Holder delivered for purchase and a statement that such Holder is withdrawing
his or her election to have such Security purchased;
(7) that Holders whose Securities were purchased only in part
will be issued new securities equal in principal amount to the unpurchased
portion of the Securities surrendered; provided, however, that each Security
purchased and each new Security issued shall be in an original principal amount
of $1,000 or integral multiples thereof; and
(8) that the Net Proceeds Offer shall remain open for a period
of 20 Business Days or such longer period as may be required by law.
(e) On or before the Net Proceeds Offer Payment Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant to
the Net Proceeds Offer which are to be purchased in accordance with item (b)(1)
above, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the purchase price of all Securities to be purchased and (iii) deliver to the
Trustee Securities so accepted together with an Officers' Certificate stating
the Securities or portions thereof being purchased by the Company. The Paying
Agent shall promptly mail to the Holders of Securities so accepted payment in an
amount equal to the purchase price (and the Trustee shall promptly authenticate
and mail or deliver to such Holders a new Security equal in principal amount to
any unpurchased portion of the Security surrendered provided that each such new
Security shall be in the principal amount of $1,000 or integral multiples
thereof) unless such payment is prohibited pursuant to Article Four or
otherwise. The Company will publicly announce the results of the Net Proceeds
Offer on or as soon as
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practicable after the Net Proceeds Offer Payment Date. For purposes of this
Section 5.16, the Trustee shall act as the Paying Agent.
(f) Any amounts remaining after the purchase of Securities pursuant
to a Net Proceeds Offer shall be returned by the Trustee to the Company.
(g) The Company must comply with Rule 14e-1 under the Exchange Act
and other provisions of State and federal securities laws to the extent
applicable in connection with a Net Proceeds Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
this Section 5.16, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
the provisions of this Section 5.16 by virtue thereof.
Section 5.17. Limitation on Preferred Stock of Restricted Subsidiaries.
The Company will not permit any of its Restricted Subsidiaries to
issue any Preferred Stock (other than to the Company or to a Wholly Owned
Restricted Subsidiary of the Company) or permit any Person (other than the
Company or a Wholly Owned Restricted Subsidiary of the Company) to own any
Preferred Stock of any Restricted Subsidiary of the Company.
Section 5.18. Limitation on Other Senior Subordinated Debt.
The Company will not incur or suffer to exist Indebtedness that is
senior in right of payment to the Securities and subordinate in right of payment
to any other Indebtedness of the Company.
Section 5.19. Limitation on Restricted and Unrestricted Subsidiaries.
(a) The Board of Directors of the Company may, if no Default or Event
of Default shall have occurred and be continuing or would result therefrom,
designate any Restricted Subsidiary to be an Unrestricted Subsidiary if such
designation is at that time permitted under Section 5.3. The Board of Directors
of the Company may, if no Default or Event of Default shall have occurred and be
continuing or would result therefrom, designate an Unrestricted Subsidiary to be
a Restricted Subsidiary; provided, however, that (i) any such redesignation
shall be deemed to be an Incurrence as of the date of such redesignation by the
Company and the Restricted Subsidiaries of the Indebtedness (if any) of such
redesignated Subsidiary for purposes of Section 5.12; and (ii) unless such
redesignated Subsidiary shall not have any Indebtedness outstanding (other than
Indebtedness which would be Permitted Indebtedness), no such designation shall
be permitted if immediately after giving effect to such redesignation and the
Incurrence of any such Indebtedness, the Company could not incur $1.00 of
additional Indebtedness pursuant to the proviso of Section 5.12. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee by the filing with the Trustee of a Board Resolution of the Company
giving effect to such designation or redesignation and an Officers' Certificate
certifying that such designation or redesignation complied with the foregoing
conditions and setting forth in reasonable detail the underlying calculations.
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(b) Subsidiaries that are not designated by the Board of Directors as
Restricted or Unrestricted Subsidiaries will be deemed to be Restricted
Subsidiaries. The designation of a Restricted Subsidiary as an Unrestricted
Subsidiary shall be deemed to include a designation of all of the subsidiaries
of such Unrestricted Subsidiary as Unrestricted Subsidiaries.
Section 5.20. Limitation of Guarantees by Restricted Subsidiaries.
(a) The Company will not permit any of its Restricted Subsidiaries,
directly or indirectly, by way of the pledge of any intercompany note or
otherwise, to assume, guarantee or in any other manner become liable with
respect to any Indebtedness of the Company or any other Restricted Subsidiary of
the Company (other than (A) Indebtedness and other obligations under the Credit
Agreement, (B) Permitted Indebtedness of a Restricted Subsidiary of the Company,
(C) Indebtedness under Currency Agreements in reliance on clause (v) of the
definition of Permitted Indebtedness, or (D) Interest Swap Obligations incurred
in reliance on clause (iv) of the definition of Permitted Indebtedness), unless,
in any such case (a) such Restricted Subsidiary executes and delivers a
supplemental indenture to this Indenture, providing a guarantee of payment of
the Securities by such Restricted Subsidiary (the "Guarantee") and (b) (x) if
any such assumption, guarantee or other liability of such Restricted Subsidiary
is provided in respect of Senior Debt, the guarantee or other instrument
provided by such Restricted Subsidiary in respect of such Senior Debt may be
superior to the Guarantee pursuant to subordination provisions no less favorable
to the Holders of the Securities than those contained in this Indenture and (y)
if such assumption, guarantee or other liability of such Restricted Subsidiary
is provided in respect of Indebtedness that is expressly subordinated to the
Securities, the guarantee or other instrument provided by such Restricted
Subsidiary in respect of such subordinated Indebtedness shall be subordinated to
the Guarantee pursuant to subordination provisions no less favorable to the
Holders of the Securities than those contained in this Indenture.
(b) Notwithstanding the foregoing, any such Guarantee by a Restricted
Subsidiary of the Securities shall provide by its terms that it shall be
automatically and unconditionally released and discharged, without any further
action required on the part of the Trustee or any Holder, upon: (i) the
unconditional release of such Restricted Subsidiary from its liability in
respect of the Indebtedness in connection with which such Guarantee was executed
and delivered pursuant to the preceding paragraph; or (ii) any sale or other
disposition (by merger or otherwise) to any Person which is not a Restricted
Subsidiary of the Company of all of the Company's Capital Stock in, or all or
substantially all of the assets of, such Restricted Subsidiary; PROVIDED that
(a) such sale or disposition of such Capital stock or assets is otherwise in
compliance with the terms of this Indenture and (b) such assumption, guarantee
or other liability of such Restricted Subsidiary has been released by the
holders of the other Indebtedness so guaranteed.
Section 5.21. Conduct of Business.
The Company and its Restricted Subsidiaries will not engage in any
businesses which are not the same, similar or related to the businesses in which
the Company and its Restricted Subsidiaries are engaged on the Issue Date.
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ARTICLE VI.
SUCCESSOR CORPORATION
Section 6.1. Limitations on Mergers and Certain Other Transactions.
(a) The Company will not, in a single transaction or series of
related transactions, consolidate or merge with or into any Person, or sell,
assign, transfer, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary of the Company to sell, assign, transfer, lease, convey or
otherwise dispose of) all or substantially all of the Company's assets
(determined on a consolidated basis for the Company and the Company's Restricted
Subsidiaries) whether as an entirety or substantially as an entirety to any
Person unless:
(i) either (1) the Company shall be the surviving or continuing
corporation or (2) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which acquires
by sale, assignment, transfer, lease, conveyance or other disposition the
properties and assets of the Company and of the Company's Restricted
Subsidiaries substantially as an entirety (the "Surviving Entity") (x) shall be
a corporation organized and validly existing under the laws of the United States
or any State thereof or the District of Columbia and (y) shall expressly assume,
by supplemental indenture (in form and substance satisfactory to the Trustee),
executed and delivered to the Trustee, the due and punctual payment of the
principal of, and premium, if any, and interest on all of the Securities and the
performance of every covenant of the Securities and this Indenture on the part
of the Company to be performed or observed;
(ii) immediately after giving effect to such transaction and the
assumption contemplated by clause (i)(2)(y) above (including giving effect to
any Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred in connection with or in respect of such transaction), the Company or
such Surviving Entity, as the case may be, (1) shall have a Consolidated Net
Worth equal to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction and (2) shall be able to incur at least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 5.12;
(iii) immediately before and immediately after giving effect
to such transaction and the assumption contemplated by clause (i)(2)(y) above
(including, without limitation, giving effect to any Indebtedness and Acquired
Indebtedness incurred or anticipated to be incurred and any Lien granted in
connection with or in respect of the transaction), no Default or Event of
Default shall have occurred or be continuing; and
(iv) the Company or the Surviving Entity shall have delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale, assignment, transfer, lease, conveyance
or other disposition and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent in this Indenture
relating to such transaction have been satisfied.
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(b) For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
Section 6.2. Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company in accordance with Section 6.1,
in which the Company is not the continuing corporation, the successor Person
formed by such consolidation or into which the Company is merged or to which
such conveyance, lease or transfer is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Indenture
and the Securities with the same effect as if such surviving entity had been
named as such.
ARTICLE VII
DEFAULT AND REMEDIES
Section 7.1. Events of Default.
Each of the following events constitutes an "Event of Default":
(i) the failure to pay interest on any Securities when the same
becomes due and payable and the default continues for a period of 30 days
(whether or not such payment shall be prohibited by Article Four);
(ii) the failure to pay the principal on any Securities, when such
principal becomes due and payable, at maturity, upon redemption or otherwise
(including the failure to make a payment to purchase Securities tendered
pursuant to a Change of Control Offer or a Net Proceeds Offer) (whether or not
such payment shall be prohibited by Article Four);
(iii) a default in the observance or performance of any other
covenant or agreement contained in this Indenture which default continues for a
period of 30 days after the Company receives written notice specifying the
default (and demanding that such default be remedied) from the Trustee or the
Holders of at least 25% of the outstanding principal amount of the Securities
(except in the case of a failure to comply with Section 6.1, which will
constitute an Event of Default with such notice requirement but without such
passage of time requirement);
(iv) the failure to pay at final maturity (giving effect to any
applicable grace periods and any extensions thereof) the principal amount of any
Indebtedness of the Company or any Restricted Subsidiary of the Company, or the
acceleration of the final stated maturity of any such Indebtedness if the
Aggregate principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay principal at
final maturity or which has been accelerated, aggregates $5,000,000 or more at
any time;
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(v) one or more judgments in an aggregate amount in excess of
$5,000,000 (excluding any amounts covered by insurance as to which the insurer
has acknowledged coverage) shall have been rendered against the Company or any
of its Restricted Subsidiaries and such judgments remain undischarged, unpaid or
unstayed for a period of 60 days after such judgment or judgments become final
and non-appealable;
(vi) the Company or any of its Significant Subsidiaries pursuant to or
within the meaning of any Bankruptcy Law: (a) commences a voluntary case or
proceeding; (b) consents to the entry of an order for relief against it in an
involuntary case or proceeding; (c) consents to the appointment of a Custodian
of it or for all or substantially all of its property; (d) makes a general
assignment for the benefit of its creditors; or (e) generally is not paying its
debts as they become due;
(vii) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (a) is for relief against the Company or any of
its Significant Subsidiaries in an involuntary case or proceeding; (b) appoints
a Custodian of the Company or any of its Significant Subsidiaries, or for all or
any substantial part of their respective properties; or (c) orders the
liquidation of the Company or any of its Significant Subsidiaries, and in each
case the order or decree remains unstayed and in effect for 60 days; or
(viii) the lenders under the Credit Agreement shall commence
judicial proceedings to foreclose upon any material portion of the assets of the
Company and the Subsidiaries.
Section 7.2. Acceleration.
(a) If an Event of Default (other than an Event of Default specified
in clauses (vi) or (vii) of Section 7.1 with respect to the Company) shall occur
and be continuing, the Trustee or the Holders of at least 25% in principal
amount of outstanding Securities may declare the principal of and accrued
interest on all the Securities to be due and payable by notice in writing to the
Company and the Trustee specifying the respective Event of Default and that it
is a "notice of acceleration" (the "Acceleration Notice"), and the same (i)
shall become immediately due and payable or (ii) if there are any amounts
outstanding under the Credit Agreement, shall become immediately due and payable
upon the first to occur of an acceleration under the Credit Agreement or 5
business days after receipt by the Company and the Credit Agent under the Credit
Agreement of such Acceleration Notice. If an Event of Default specified in
clauses (vi) or (vii) of Section 7.1 with respect to the Company occurs and is
continuing, then all unpaid principal of, and premium, if any, and accrued and
unpaid interest on all of the outstanding Securities shall IPSO FACTO become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Holder.
(b) At any time after a declaration of acceleration with respect to
the Securities as described in the preceding paragraph, the Holders of a
majority in principal amount of the Securities may rescind and cancel such
declaration and its consequences (i) if the rescission would not conflict with
any judgment or decree, (ii) if all existing Events of Default have been cured
or waived except nonpayment of principal or interest that has become due solely
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because of the acceleration, (iii) to the extent the payment of such interest is
lawful, interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of acceleration, has
been paid, (iv) if the Company has paid the Trustee its reasonable compensation
and reimbursed the Trustee for its expenses, disbursements and advances and (v)
in the event of the cure or waiver of an Event of Default of the type described
in clauses (vi) or (vii) of Section 7.1, the Trustee shall have received an
Officers' Certificate and an Opinion of Counsel that such Event of Default has
been cured or waived. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
(c) The Holders of a majority in principal amount of the Securities
may waive any existing Default or Event of Default under this Indenture, and its
consequences, except a default in the payment of the principal of or interest on
any Securities.
(d) Holders of the Securities may not enforce this Indenture or the
Securities except as provided in this Indenture and under the TIA. Subject to
the provisions of Article Eight, the Trustee is under no obligation to exercise
any of its rights or powers under this Indenture at the request, order or
direction of any of the Holders, unless such Holders have offered to the Trustee
reasonable indemnity. Subject to all provisions of Section 7.5 and applicable
law, the Holders of a majority in aggregate principal amount of the then
outstanding Securities 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.
(e) The Company is required to provide an Officers' Certificate to
the Trustee promptly upon any such officer obtaining knowledge of any Default or
Event of Default (provided that such officers shall provide such certification
at least annually whether or not they know of any Default or Event of Default)
that has occurred and, if applicable, describe such Default or Event of Default
and the status thereof.
Section 7.3. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of
any other remedy. All available remedies are cumulative to the extent permitted
by law.
Section 7.4. Waiver of Past Defaults.
Subject to Sections 7.7 and 10.2, the Holders of a majority in
principal amount of the outstanding Securities by notice to the Trustee may
waive an existing Default or Event of
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Default and its consequences, except a Default in the payment of principal of or
interest on any Security as specified in clauses (i) and (ii) of Section 7.1
(other than any such Default arising solely by reason of acceleration of the
Securities). When a Default or Event of Default is waived, it is cured and
ceases.
Section 7.5. Control by Majority.
Subject to Section 2.9, the Holders of a majority in principal amount
of the outstanding Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it, including, without limitation, any remedies
provided for in Section 7.3. Subject to Section 8.1, however, the Trustee may
refuse to follow any direction that conflicts with any law or this Indenture,
that the Trustee determines may be unduly prejudicial to the rights of another
Holder, or that may involve the Trustee in personal liability; provided,
however, that the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 7.6. Limitation on Suits.
A Holder may not pursue any remedy with respect to this Indenture or
the Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holder or Holders of at least 25% in principal amount of the
outstanding Securities make a written request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense to be
incurred in compliance with such request;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) during such 60-day period the Holder or Holders of a majority in
principal amount of the outstanding Securities do not give the Trustee a
direction which, in the opinion of the Trustee, is inconsistent with the
request.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
Section 7.7. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of and interest on a Security, on or
after the respective due dates expressed in such Security, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of the Holder.
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Section 7.8. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest specified
in clause (i) or (ii) of Section 7.1 occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor on the Securities for the whole amount of principal
and accrued interest remaining unpaid, together with interest on overdue
principal and, to the extent that payment of such interest is lawful, interest
on overdue installments of interest, in each case at the rate per annum borne by
the Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 7.9. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relating to the Company or any other
obligor upon the Securities, any of their respective creditors or any of their
respective property and shall be entitled and empowered to collect and receive
any monies or other property payable or deliverable on any such claims and to
distribute the same, and any Custodian in any such judicial proceedings is
hereby authorized by each Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 8.7. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder, or to authorize the Trustee to vote in respect of
the claim of any Holder in any such proceeding.
Section 7.10. Priorities.
If the Trustee collects any money pursuant to this Article Seven, it
shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 8.7;
Second: subject to Article Four, to Holders for interest accrued on
the Securities, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Securities for interest; and
Third: subject to Article Four, to Holders for principal amounts due
and unpaid on the Securities, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for principal.
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The Trustee, upon prior notice to the Company, may fix a record date
and payment date for any payment to Holders pursuant to this Section 7.10.
Section 7.11. Rights and Remedies Cumulative.
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 7.12. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder 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 Seven 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 7.13. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 7.13 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 7.7, or a suit by a Holder or Holders of more than 10% in
principal amount of the outstanding Securities.
ARTICLE VIII.
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
Section 8.1. Duties of Trustee.
(a) If a Default or an Event of Default of which a Trust Officer of
the Trustee is aware has occurred and is continuing, the Trustee shall exercise
such of the rights and powers vested in it by this Indenture and use the same
degree of care and skill in its exercise thereof as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
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(b) Except during the continuance of a Default or an Event of Default
of which the Trust Officer of the Trustee is aware:
(1) The Trustee need undertake to perform only those duties as
are specifically set forth in this Indenture and no covenants or obligations
shall be implied in this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee shall have no liability except for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 8.1.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 7.5.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 8.1.
(f) The Trustee shall not be liable for interest on any assets
received by it. Assets held in trust by the Trustee need not be segregated from
other assets except to the extent required by law.
Section 8.2. Rights of Trustee.
Subject to Section 8.1:
(a) The Trustee may rely on and shall be protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper Person, including, without
limitation, any Person purporting to be a holder of Senior
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Debt or a Representative. The Trustee need not investigate any fact or matter
stated in the document or the status of any such Person delivering such
document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require in addition to written direction from the Company
an Officers' Certificate or an Opinion of Counsel, which shall conform to
Sections 11.4 and 11.5. The Trustee shall not be liable for any action it takes
or omits to take in good faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any attorney or agent
appointed with due care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, notice, request, direction, consent, order, bond, debenture, or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
Section 8.3. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, its
Subsidiaries, or their respective Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights. However,
the Trustee must comply with Sections 8.10 and 8.11.
Section 8.4. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement in the Securities other than the Trustee's certificate of
authentication.
Section 8.5. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it
is known to a Trust Officer of the Trustee, the Trustee shall mail to each
Holder notice of the Default or Event of Default within 90 days after such
Default or Event of Default occurs or if such Default or
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Event of Default is known to a Trust Officer of the Trustee during such 90-day
period, promptly after such Default or Event of Default becomes known to a Trust
Officer of the Trustee; provided, however, that, except in the case of a Default
or Event of Default in the payment of the principal of or interest on any
Security, including the failure to make payment on a Change of Control Payment
Date pursuant to a Change of Control Offer or payment when due pursuant to a Net
Proceeds Offer, the Trustee may withhold such notice if it in good faith
determines that withholding such notice is in the interest of the Holders.
Section 8.6 Reports by Trustee to Holders.
Within 60 days after each September 30 beginning with the first
September 30 following the date of this Indenture, the Trustee shall, to the
extent that any of the events described in TIA Section 313(a) occurred within
the previous twelve months, but not otherwise, mail to each Holder a brief
report dated as of such September 30 that complies with TIA Section 313(a).
The Trustee also shall comply with TIA Sections 313(b) and 313(c).
A copy of each report at the time of its mailing to Holders shall be
mailed to the Company and filed with the Commission and each stock exchange, if
any, on which the Securities are listed.
The Company shall notify the Trustee if the Securities become listed
on any stock exchange.
Section 8.7. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee for, and hold it harmless
against, any loss or liability incurred by it except for such actions to the
extent caused by any negligence or bad faith on its part, arising out of or in
connection with the administration of this trust and its rights or duties
hereunder. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. The Company shall defend
the claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Company shall pay the reasonable fees and expenses of
such counsel; provided, however, that the Company will not be required to pay
such fees and expenses if it assumes the Trustee's defense and there is no
conflict of interest between the Company and the Trustee in connection with such
defense as reasonably determined by the Trustee. The Company need not pay for
any settlement made without its written consent. The Company need not reimburse
any expense or indemnify against any loss or liability to the extent incurred by
the Trustee through its negligence, bad faith or willful misconduct.
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To secure the Company's payment obligations in this Section 8.7, the
Trustee shall have a lien prior to the Securities on all assets held or
collected by the Trustee, in its capacity as Trustee, except assets held in
trust to pay principal of or interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 7.1(vi) or (vii) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 8.8. Replacement of Trustee.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the outstanding Securities may remove the
Trustee and appoint a successor trustee with the Company's consent, by so
notifying the Company and the Trustee. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 8.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 8.7, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 8.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this Section
8.8, the Company's obligations under Section 8.7 shall continue for the benefit
of the retiring Trustee.
Section 8.9. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
Section 8.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1) and 310(a)(5). The Trustee shall have a
combined capital and surplus of at least $100,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which
other securities, or certificates of interest or participation in other
securities, of the Company are outstanding, if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.
Section 8.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE IX.
SATISFACTION AND DISCHARGE OF INDENTURE
Section 9.1. Termination of the Company's Obligations.
The Company may terminate its obligations under the Securities and
this Indenture, except those obligations referred to in the penultimate
paragraph of this Section 9.1, if
(1) either (a) all Securities theretofore authenticated and
delivered (except lost, stolen or destroyed Securities which have been
replaced or paid or Securities 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 9.4) have been delivered to the Trustee for cancellation and the
Company has paid all sums payable by it hereunder, or (b) all Securities not
theretofore delivered to the Trustee for cancellation have become due and
payable and the Company has irrevocably deposited or caused to be deposited
with the Trustee funds in an amount sufficient to pay and discharge the
entire Indebtedness on the Securities not theretofore delivered to the
Trustee for cancellation, for principal of, premium, if any, and interest on
the Securities to the date of deposit together with irrevocable instructions
from the Company directing the Trustee to apply such funds to the payment
thereof at maturity or redemption, as the case may be;
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(2) the Company has paid all other sums payable by it hereunder; and
(3) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent providing for the termination of the Company's obligations under
the Securities and this Indenture have been complied with. Such Opinion of
Counsel shall also state that such satisfaction and discharge does not result
in a default under the Credit Agreement (if then in effect) or any other
agreement or instrument then known to such counsel that binds or affects the
Company.
Notwithstanding the foregoing paragraph, the Company's obligations
in Sections 2.5, 2.6, 2.7, 2.8, 5.1, 5.2 and 8.7 shall survive until the
Securities are no longer outstanding pursuant to the last paragraph of
Section 2.8. After the Securities are no longer outstanding, the Company's
obligations in Sections 8.7, 9.4 and 9.5 in respect thereof shall survive.
After such delivery or irrevocable deposit the Trustee upon request
shall acknowledge in writing the discharge of the Company's obligations under
the Securities and this Indenture except for those surviving obligations
specified above.
Section 9.2 Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option by Board Resolution of the Board
of Directors of the Company, at any time, with respect to the Securities, elect
to have either paragraph (b) or paragraph (c) below be applied to the
outstanding Securities upon compliance with the conditions set forth in
paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (b), the Company shall be deemed to have been
released and discharged from its obligations with respect to the outstanding
Securities on the date the conditions set forth below are satisfied
(hereinafter, "legal defeasance"). For this purpose, legal defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the outstanding Securities, which shall thereafter
be deemed to be "outstanding" only for the purposes of paragraph (e) below and
the other Sections of and matters under this Indenture referred to in (i) and
(ii) below, and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), and Holders of the Securities and any amounts deposited
under paragraph (d) below shall cease to be subject to any obligations to, or
the rights of, any holder of Senior Debt under Article Four or otherwise, except
for the following which shall survive until otherwise terminated or discharged
hereunder: (i) the rights of Holders to receive payments in respect of the
principal of, premium, if any, and interest on the Securities when such payments
are due, (ii) the Company's obligations with respect to such Securities under
Sections 2.6, 2.7 and 5.2, and, with respect to the Trustee, under Section 8.7,
(iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder
and the Company's obligations in connection therewith and (iv) this Section 9.2
and Section 9.5. Subject to compliance with this Section 9.2, the Company may
exercise its option under this paragraph (b) notwithstanding the prior exercise
of its option under paragraph (c) below with respect to the Securities.
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(c) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (c), the Company shall be released and discharged
from its obligations under any covenant contained in Article Four and Article
Six and in Sections 5.3, 5.5 through 5.9 and 5.11 through 5.21 with respect to
the outstanding Securities on and after the date the conditions set forth below
are satisfied (hereinafter, "covenant defeasance"), and the Securities shall
thereafter be deemed to be not "outstanding" for the purpose of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder and Holders of the Securities and
any amounts deposited under paragraph (d) below shall cease to be subject to any
obligations to, or the rights of, any holder of Senior Debt under Article Four
or otherwise. For this purpose, covenant defeasance means that, with respect to
the outstanding Securities, the Company may omit to comply with and shall have
no liability in respect of any term, condition or limitation set forth in any
such covenant listed above, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 7.1(iii), but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby.
(d) The following shall be the conditions to application of either
paragraph (b) or paragraph (c) above to the outstanding Securities:
(i) the Company must have irrevocably deposited with the Trustee
(or another trustee satisfying the requirements of Section 8.10 who shall agree
to comply with the provisions of this Section 9.2 applicable to it) in trust,
for the benefit of the Holders, cash in U.S. dollars, U.S. Government
Obligations, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, premium, if any, and interest on the Securities on the
Maturity Date or Redemption Date, as the case may be; provided that the Trustee
shall have been irrevocably instructed to apply such money or the proceeds of
such U.S. Government Obligations to said payments with respect to the Securities
on the Maturity Date or such Redemption Date, as the case may be;
(ii) in the case of legal defeasance, the Company shall have
delivered to the Trustee one or more Opinions of Counsel to the effect that (A)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) 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 of Counsel shall confirm that, the Holders
will not recognize income, gain or loss for federal income tax purposes as a
result of such legal defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such legal defeasance had not occurred;
(iii) in the case of covenant defeasance, the Company shall
have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the
Trustee confirming that the Holders will not recognize income, gain or loss for
federal income tax purposes as a
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result of such covenant defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such covenant defeasance had not occurred;
(iv) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as clauses (vi) or (vii) of
Section 7.1 are concerned, at any time in the period ending on the 91st day
after the date of deposit;
(v) such legal defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default under this Indenture
or any other material agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(vi) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Company or others;
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the legal defeasance or the
covenant defeasance have been complied with; and
(viii) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that, after the 91st day following the deposit,
the trust funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally.
(a) All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee, collectively
for purposes of this paragraph (e), the "Trustee") pursuant to paragraph (d)
above in respect of the outstanding Securities shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(other than the Company or any Affiliate of the Company), to the Holders of such
Securities of all sums due and to become due thereon in respect of principal,
premium and interest, but such money need not be segregated from other funds
except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to paragraph (d) above or the principal, premium, if any, 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
Securities. The Company's obligations to pay and indemnify the Trustee as set
forth in this paragraph shall survive the termination of this Indenture and the
Securities.
Anything in this Section 9.2 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request,
in writing, by the Company any money or U.S. Government Obligations held by it
as provided in paragraph (d) above which,
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in the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent legal defeasance or covenant defeasance.
Section 9.3. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Sections 9.1 and 9.2, and shall apply the
deposited money and the money from U.S. Government Obligations in accordance
with this Indenture to the payment of principal of, premium, if any, and
interest on the Securities.
Section 9.4. Repayment to the Company.
Subject to Sections 8.7, 9.1 and 9.2, the Trustee shall promptly pay
to the Company upon receipt by the Trustee of an Officers' Certificate, any
excess money, determined in accordance with Section 9.2, held by it at any
time. The Trustee and the Paying Agent shall pay to the Company, as the case
may be, upon receipt by the Trustee or the Paying Agent, as the case may be,
of an Officers' Certificate, any money held by it for the payment of
principal, premium, if any, or interest that remains unclaimed for two years
after payment to the Holders is required; provided, however, that the Trustee
and the Paying Agent before being required to make any payment may, but need
not, at the expense of the Company cause to be published once in a newspaper
of general circulation in The City of New York or mail to each Holder
entitled to such money notice that such money remains unclaimed and that
after a date specified therein, which shall be at least 30 days from the date
of such publication or mailing, any unclaimed balance of such money then
remaining will be repaid to the Company. After payment to the Company, as
the case may be, Holders entitled to money must look solely to the Company
for payment as general creditors unless an applicable abandoned property law
designates another person, and all liability of the Trustee or Paying Agent
with respect to such money shall thereupon cease.
Section 9.5. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Indenture by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then and only then the Company's, if any, obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had been made pursuant to this Indenture until such time as the
Trustee is permitted to apply all such money or U.S. Government Obligations
in accordance with this Indenture; provided, however, that if the Company
have made any payment of principal of, premium, if any, or interest on any
Securities because of the reinstatement of its obligations, the Company shall
be subrogated to the rights of the holders of such Securities to receive such
payment from the money or U.S. Government Obligations held by the Trustee or
Paying Agent.
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ARTICLE X.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 10.1. Without Consent of Holders.
The Company when authorized by a Board Resolution, and the Trustee,
together, may amend or supplement this Indenture or the Securities without
notice to or consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency or to comply
with requirements of the Commission in order to maintain the qualification of
this Indenture under the TIA, so long as such change does not, in the opinion
of the Trustee, adversely affect the rights of any of the Holders in any
material respect; and
(2) to comply with Article Six.
In formulating its opinion on such matters, the Trustee will be
entitled to rely on such evidence as it deems appropriate, including, without
limitation, solely on an Opinion of Counsel.
Section 10.2. With Consent of Holders.
Subject to Section 7.7, the Company, when authorized by a Board
Resolution, the Trustee and the Holders of not less than a majority in
aggregate principal amount of the Securities then outstanding, may amend or
supplement (or waive compliance with any provision of) this Indenture or the
Securities without any notice to any other Holder, except that without the
consent of each Holder of the Securities affected, no such amendment,
supplement or waiver may:
(1) reduce the principal amount of the Securities whose
Holders must consent to an amendment, supplement or waiver of any provision
of this Indenture or the Securities;
(2) reduce the rate of or change or have the effect of changing
the time for payment of interest, including defaulted interest, on any
Securities;
(3) reduce the principal of or change or have the effect of
changing the fixed maturity of any Securities, or change the date on which any
Securities may be subject to redemption or repurchase, or reduce the redemption
or repurchase price therefor (other than a payment required under Sections 5.15
or 5.16);
(4) make the principal of, or interest on, any Securities
payable with anything or in any manner other than as provided for in the
Securities;
(5) make any changes in the provisions of this Indenture
protecting the right of each Holder to receive payment of principal of and
interest on such Securities on or after
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the due date thereof or to bring suit to enforce such payment, or permitting
Holders of a majority in principal amount of Securities to waive Defaults or
Events of Default; or
(6) modify or change any provision of this Indenture or the
related definitions affecting the Subordination or ranking of the Securities in
a manner which adversely affects the Holders.
The Company agrees that no amendment, supplement or waiver under this
Article Ten may make any change that adversely affects the rights under Article
Four of any holders of any Senior Debt unless the holders of such Senior Debt
consent to the change.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
In connection with any amendment, supplement or waiver under this
Article Ten, the Company may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment, supplement or waiver.
Section 10.3. Compliance with TIA.
From the date on which this Indenture is qualified under the TIA,
every amendment, waiver or supplement of this Indenture or the Securities shall
comply with the TIA as then in effect.
Section 10.4. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his or her Security or portion of his or her Security by notice to
the Trustee or the Company received before the date on which the Trustee
receives an Officers' Certificate certifying that the Holders of the requisite
principal amount of Securities have consented (and not theretofore revoked such
consent) to the amendment, supplement or waiver.
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 amendment,
supplement or waiver, which
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record date shall be at least 30 days prior to the first solicitation of such
consent. If a record date is fixed, then notwithstanding the last sentence of
the immediately preceding paragraph, those persons who were Holders at such
record date (or their duly designated proxies), and only those persons, shall be
entitled to revoke any consent previously given, whether or not such persons
continue to be Holders after such record date. No such consent shall be valid
or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in Section 10.2, in which
case, the amendment, supplement or waiver shall bind only each Holder of a
Security who has consented to it and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the consenting Holder's
Security; provided, however, that any such waiver shall not impair or affect the
right of any Holder to receive payment of principal of and interest on a
Security, on or after the respective due dates expressed in such Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates without the consent of such Holder.
Section 10.5. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security
about the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new Security that
reflects the changed terms.
Section 10.6. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Ten; provided, however, that the Trustee
may, but shall not be obligated to, execute any such amendment, supplement or
waiver which affects the Trustee's own rights, duties or immunities under
this Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution
of any amendment, supplement or waiver authorized pursuant to this Article
Ten is authorized or permitted by this Indenture.
ARTICLE XI.
MISCELLANEOUS
Section 11.1 TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts
with the duties imposed by operation of Section 318(c) of the TIA, the imposed
duties shall control.
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Section 11.2. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Company:
Color Spot Nurseries, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
w/a copy to:
Xxxxxxxxxx Hyatt Xxxxxx & Xxxxxxxxxx, P.C.
000 Xxxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
if to the Trustee:
U.S. Trust Company of California, N.A.
000 Xxxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Corporate Trust Administration
if to the Credit Agent:
Credit Agricole Indosuez
[address]
Attention: _____________
Each of the Company, the Trustee and the Credit Agent by written
notice to each other such person may designate additional or different addresses
for notices to such person. Any notice or communication to the Company, the
Trustee and the Credit Agent shall be deemed to have been given or made as of
the date so delivered if personally delivered; when answered back, if telexed;
when receipt is acknowledged, if telecopied; and five (5) calendar days after
mailing if sent by registered or certified mail, postage prepaid (except that a
notice of change of address shall not be deemed to have been given until
actually received by the addressee).
Any notice or communication mailed to a Holder shall be mailed to him
or her by first class mail or other equivalent means at his or her address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him or her if so mailed within the time prescribed.
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Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
Section 11.3. Communications by Holders with Other Holders.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and any other person shall have the
protection of TIA Section 312(c).
Section 11.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company, upon request, shall furnish to the
Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 11.5. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 5.7, shall include:
(1) a statement that the person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he or she has
made such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with; provided, however,
that with respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
Section 11.6. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Paying Agent or Registrar may make reasonable rules for its
functions.
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Section 11.7. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment
is a Saturday, a Sunday or a day on which banking institutions in New York, New
York, in the city in which the principal corporate trust office of the Trustee
is located or at such place of payment are not required to be open. If a
payment date is a Legal Holiday at such place, payment may be made at such place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period.
Section 11.8. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. Each of the parties hereto agrees to submit to the
jurisdiction of the courts of the State of New York in any action or proceeding
arising out of or relating to this Indenture.
Section 11.9. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Company or any of its Subsidiaries. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
Section 11.10. No Recourse Against Others.
No director, officer, employee, stockholder or incorporator, as such,
of the Company or its Subsidiaries shall have any liability for any obligations
of the Company under the Securities or this Indenture or for any claim based on,
in respect of, or by reason of, such obligations or their creation. Each Holder
by accepting a Security waives and releases all such liability. Such waiver and
release are part of the consideration for the issuance of the Securities.
Section 11.11 Successors.
All agreements of the Company in this Indenture and the Securities
shall bind their respective successors. All agreements of the Trustee in this
Indenture shall bind its successor.
Section 11.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.
Section 11.13. Severability.
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality
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and enforceability of any such provision in every other respect and of the
remaining provisions shall not in any way be affected or impaired thereby, it
being intended that all of the provisions shall be enforceable to the full
extent permitted by law.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the date first written above.
COLOR SPOT NURSERIES, INC.
By:
------------------------------
Name:
Title:
Attest:
---------------------------
[name]
[title]
U.S. TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:
--------------------------------
Name:
Title:
Attest:
---------------------------
[name]
[title]
EXHIBIT A
FORM OF SECURITY
[FACE OF SECURITY]
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Company
or its agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Unless and until this Global Security is exchanged in whole or in part
for the individual Securities represented hereby, this Global Security may not
be transferred except as a whole by the Depository to a nominee of the
Depository or by a nominee of the Depository to the Depository or by a
Depository or any such nominee to a successor Depository or a nominee of a
successor Depository.
COLOR SPOT NURSERIES, INC.
____% Senior Subordinated Note
due 2007
No. $_______________________
Cusip No. ___________
COLOR SPOT NURSERIES, INC., a Delaware corporation (the "Company,"
which term includes any successor corporation), for value received promises to
pay to ____________________ or registered assigns, the principal sum of
________________ Dollars, on ________, 2007.
Interest Payment Dates: __________ and __________ commencing on
__________, 1998.
Record Dates: _______ and _______.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
Dated:
COLOR SPOT NURSERIES, INC.
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
Trustee's Certification of Authentication
This is one of the _____% Senior Subordinated Notes Due 2007 described in the
within-mentioned Indenture
U.S. TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:
.------------------------------------
Authorized Signatory
A-2
[REVERSE SIDE OF SECURITY]
COLOR SPOT NURSERIES, INC.
____% Senior Subordinated Note
due 2007
1. Interest.
COLOR SPOT NURSERIES, INC., a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Security at the rate
per annum shown above. The Company will pay interest semi-annually on each
_______ and _______ of each year (the "Interest Payment Date"), commencing on
_______, 1998, to the Holders of record on the immediately preceding _______ and
_______. Interest on the Securities will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance of the Securities. Interest will be computed on the basis of a 360-day
year comprised of twelve 30-day months.
The Company shall pay interest on overdue principal and interest on
overdue installments of interest, to the extent lawful, at a rate equal to the
rate of interest otherwise payable on the Securities.
2. Method of Payment.
The Company shall pay interest on the Securities (except defaulted
interest) to the persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are cancelled on registration of transfer or registration of exchange
after such Record Date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company shall pay principal and interest in
money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and interest by wire transfer of Federal funds, or interest by
its check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address. Notwithstanding the foregoing, the Company shall pay or cause to be
paid all amounts payable with respect to non-DTC eligible Securities by wire
transfer of Federal funds to the account of the Holders of such Securities.
3. Paying Agent and Registrar.
Initially, U.S. Trust Company of California, N.A. (the "Trustee") will
act as Paying Agent and Registrar. The Company may change any Paying Agent,
Registrar or co-Registrar without notice to the Holders. The Company or any of
its Subsidiaries may, subject to certain exceptions, act as Paying Agent,
Registrar or co-Registrar.
A-3
4. Indenture.
The Company issued the Securities under an Indenture, dated as of
______, 1997 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and said Act for a statement of them. The
Securities are general unsecured obligations of the Company limited in aggregate
principal amount to $85,000,000.
5. Optional Redemption.
The Securities will be redeemable, at the option of the Company, in
whole at any time or in part from time to time, on and after ____ __, 2002, at
the following redemption prices (expressed as percentages of the principal
amount) if redeemed during the twelve-month period commencing on _______ of the
year set forth below, plus, in each case, accrued and unpaid interest to the
date of redemption:
Year Redemption
Price
2002........................................... ______%
2003........................................... ______%
2004........................................... ______%
2005 and thereafter............................ 100.000%
In addition, at any time, or from time to time, on or prior to ______ __, 2000,
the Company may, at its option, use the Net Cash Proceeds of one or more Public
Equity Offerings to redeem up to an aggregate of 35% of the principal amount of
the Securities originally issued, at a price equal to _____% of the principal
amount thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided that at least 65% of the original aggregate principal
amount of the Securities remains outstanding and provided that the redemption
notice shall have been sent not later than 120 days after the consummation of
such Public Equity Offering.
6. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Securities to be redeemed
at such Holder's registered address. In order to effect a redemption with the
proceeds of a Public Equity Offering, the Company shall send the redemption
notice not later than 120 days after the consummation of such Public Equity
Offering. Securities in denominations larger than $1,000 may be redeemed in
part.
A-4
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent for redemption on such Redemption Date
and payment of the Securities called for redemption is not prohibited under
Article Four of the Indenture, then, unless the Company defaults in the payment
of such Redemption Price, the Securities called for redemption will cease to
bear interest and the only right of the Holders of such Securities will be to
receive payment of the Redemption Price.
7. Change of Control Offer.
Upon the occurrence of a Change of Control, each Holder shall have the
right to require the repurchase of such Holder's Securities pursuant to a Change
of Control Offer at a purchase price equal to 101% of the principal amount
thereof plus accrued interest, if any, to the date of purchase. The Company
shall not be required to repurchase Securities until it has complied with its
covenants to repay in full all Indebtedness of the Company and its Subsidiaries
under the Credit Agreement or offer to repay in full all such Indebtedness and
repay the Indebtedness of each lender who has accepted its offer to repay such
Indebtedness or to obtain the requisite consent under the Credit Agreement to
permit the repurchase of the Securities pursuant to a Change of Control Offer.
8. Limitation on Asset Sales.
Under certain circumstances the Company is required to apply the net
proceeds from Asset Sales to the repayment of Senior Debt, to make an investment
in Replacement Assets, an investment in properties and assets that replace the
properties and assets that are the subject of such Asset Sale, an investment in
properties and assets that will be used in the business of the Company and the
Restricted Subsidiaries existing on the Issue Date or in a business reasonably
related thereto or to purchase in a Net Proceeds Offer (at a price equal to 100%
of the aggregate principal amount thereof, plus accrued interest to the date of
purchase) such aggregate principal amount of Securities which, when added to the
accrued interest thereon, shall be equal to the net proceeds required to be
applied thereto.
9. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption.
10. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the owner of
it for all purposes.
A-5
11. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and the Paying Agents will pay the money back to the
Company at its request. After that, all liability of the Trustee and such
Paying Agents with respect to such money shall cease.
12. Discharge Prior to Redemption or Maturity.
If the Company at any time deposits with the Trustee U.S. Legal Tender
or U.S. Government Obligations sufficient to pay the principal of and interest
on the Securities to redemption or maturity and complies with the other
provisions of the Indenture relating thereto, the Company will be discharged
from certain provisions of the Indenture and the Securities (including the
financial covenants, but excluding its obligation to pay the principal of and
interest on the Securities).
13. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture and the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture or the
Securities to cure any ambiguity, defect or inconsistency or to comply with
requirements of the Commission in order to maintain the qualification of the
Indenture under the TIA; so long as such change does not, in the opinion of the
Trustee, adversely affect the rights of any of the Holders in any material
respect, and to comply with Article Six of the Indenture.
14. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the
Company and the Restricted Subsidiaries to, among other things, incur additional
Indebtedness or Liens, make payments in respect of its Capital Stock and merge
or consolidate with any other person and sell, lease, transfer or otherwise
dispose of substantially all of its properties or assets. The limitations are
subject to a number of important qualifications and exceptions. The Company must
annually report to the Trustee on compliance with such limitations.
15. Subordination.
The Securities will be subordinated in right of payment to the prior
payment in full of all Senior Debt (as defined in the Indenture) of the Company.
To the extent and in the manner provided in the Indenture, Senior Debt must be
paid before any payment may be made to any Holder of this Security. Any Holder
by accepting this Security agrees to the subordination and authorizes the
Trustee to give it effect.
A-6
16. Successors.
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Securities. Subject to certain limitations,
Holders of a majority in aggregate principal amount of the Securities then
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Securities notice of any continuing Default
or Event of Default (except a Default in payment of principal or interest) if it
determines that withholding notice is in their interest.
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Company, its Subsidiaries or their respective Affiliates as if it were
not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator, as such,
of the Company shall have any liability for any obligation of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by
reason of, such obligations or their creation. Each Holder of a Security by
accepting a Security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of the Securities.
20. Authentication.
This Security shall not be valid until the Trustee or authenticating
agent manually signs the certificate of authentication on this Security.
21. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
A-7
22. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities immediately prior to the qualification of the
Indenture under the TIA as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
The Company will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture. Requests may be made to:
Color Spot Nurseries, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Corporate Secretary
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[FORM OF ASSIGNMENT]
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
Please insert Social Security or other
identifying number of assignee
---------------------------------------
and irrevocably appoint _______________________ agent to transfer this Security
on the books of the Company. The agent may substitute another to act for him or
her.
Dated:____________________ Signature:________________________________
------------------------------------------------------------------
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:__________________________________________
A-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 5.15 or Section 5.16 of the Indenture, as the case may be,
check the appropriate box below: Section 5.15 [ ] Section 5.16 [ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 5.15 or Section 5.16 of the Indenture, as the
case may be, state the amount you want to be purchased:
$
Date: Signature:
------------ ---------------------------------------
(Sign exactly as your name appears on the face of
this Security)
Signature Guarantee:
--------------------------------------
A-10
