EXHIBIT 18
Execution Copy
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XXXX XX Corp.
Issuer
CBRE Holding, Inc.
Parent
11 1/4% Senior Subordinated Notes Due June 15, 2011
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INDENTURE
Dated as of June 7, 2001
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State Street Bank and Trust Company
of California, N.A.
Trustee
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- ---------
310(a)(1).................................... 7.10
(a)(2)................................... 7.10
(a)(3)................................... N.A.
(a)(4)................................... N.A.
(b)...................................... 7.08; 7.10
(c)...................................... N.A.
311(a)....................................... 7.11
(b)...................................... 7.11
(c)...................................... N.A.
312(a)....................................... 2.05
(b)...................................... 13.03
(c)...................................... 13.03
313(a)....................................... 7.06
(b)(1)................................... N.A.
(b)(2)................................... 7.06
(c)...................................... 11.02
(d)...................................... 7.06
314(a)....................................... 4.02;13.02
(b)...................................... N.A.
(c)(1)................................... 13.04
(c)(2)................................... 13.04
(c)(3)................................... N.A.
(d)...................................... N.A.
(e)...................................... 13.05
(f)...................................... N.A.
315(a)....................................... 7.01
(b)...................................... 7.05; 13.02
(c)...................................... 7.01
(d)...................................... 7.01
(e)...................................... 6.11
316(a)(last sentence)........................ 13.06
(a)(1)(A)................................ 6.05
(a)(1)(B)................................ 6.04
(a)(2)................................... N.A.
(b)...................................... 6.07
317(a)(1).................................... 6.08
(a)(2)................................... 6.09
(b)...................................... 2.04
318(a)....................................... 13.01
N.A. means Not Applicable.
----------------
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.............................................. 1
SECTION 1.02. Other Definitions........................................ 36
SECTION 1.03. Incorporation by Reference of Trust Indenture Act........ 36
SECTION 1.04. Rules of Construction.................................... 37
ARTICLE 2
The Securities
SECTION 2.01. Form and Dating.......................................... 37
SECTION 2.02. Execution and Authentication............................. 38
SECTION 2.03. Registrar and Paying Agent............................... 38
SECTION 2.04. Paying Agent To Hold Money in Trust...................... 39
SECTION 2.05. Securityholder Lists..................................... 39
SECTION 2.06. Transfer and Exchange.................................... 39
SECTION 2.07. Replacement Securities................................... 39
SECTION 2.08. Outstanding Securities................................... 40
SECTION 2.09. Temporary Securities..................................... 40
SECTION 2.10. Cancellation............................................. 41
SECTION 2.11. Defaulted Interest....................................... 41
SECTION 2.12. CUSIP Numbers............................................ 41
SECTION 2.13. Issuance of Additional Securities........................ 41
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee.......................................
SECTION 3.02. Selection of Securities To Be Redeemed................... 43
SECTION 3.03. Notice of Redemption..................................... 43
SECTION 3.04. Effect of Notice of Redemption........................... 44
SECTION 3.05. Deposit of Redemption Price.............................. 44
SECTION 3.06. Securities Redeemed in Part.............................. 45
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities.................................... 45
SECTION 4.02. SEC Reports.............................................. 45
SECTION 4.03. Limitation on Indebtedness............................... 46
SECTION 4.04. Limitation on Restricted Payments........................ 51
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SECTION 4.05. Limitation on Restrictions on Distributions from Restricted Subsidiaries..................... 54
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock........................................... 56
SECTION 4.07. Limitation on Affiliate Transactions......................................................... 60
SECTION 4.08. Limitation on the Sale or Issuance of Capital Stock of Restricted Subsidiaries............... 62
SECTION 4.10. Future Guarantors............................................................................ 64
SECTION 4.11. Compliance Certificate....................................................................... 65
SECTION 4.12. Payment of Additional Interest............................................................... 65
SECTION 4.13. Further Instruments and Acts................................................................. 65
ARTICLE 5
Merger and Consolidation
SECTION 5.01. When Company, Subsidiary Guarantors and Parent May Merge or Transfer Assets.................. 65
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default............................................................................ 68
SECTION 6.02. Acceleration................................................................................. 70
SECTION 6.03. Other Remedies............................................................................... 71
SECTION 6.04. Waiver of Past Defaults...................................................................... 71
SECTION 6.05. Control by Majority.......................................................................... 72
SECTION 6.06. Limitation on Suits.......................................................................... 72
SECTION 6.07. Rights of Holders to Receive Payment......................................................... 73
SECTION 6.08. Collection Suit by Trustee................................................................... 73
SECTION 6.09. Trustee May File Proofs of Claim............................................................. 73
SECTION 6.10. Priorities................................................................................... 73
SECTION 6.11. Undertaking for Costs........................................................................ 74
SECTION 6.12. Waiver of Stay or Extension Laws............................................................. 74
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee............................................................................ 74
SECTION 7.02. Rights of Trustee............................................................................ 76
SECTION 7.03. Individual Rights of Trustee................................................................. 76
SECTION 7.04. Trustee's Disclaimer......................................................................... 76
SECTION 7.05. Notice of Defaults........................................................................... 77
SECTION 7.06. Reports by Trustee to Holders................................................................ 77
SECTION 7.07. Compensation and Indemnity................................................................... 77
SECTION 7.08. Replacement of Trustee....................................................................... 78
SECTION 7.09. Successor Trustee by Merger.................................................................. 79
SECTION 7.10. Eligibility; Disqualification................................................................ 79
SECTION 7.11. Preferential Collection of Claims Against Company............................................ 80
3
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance............................................. 80
SECTION 8.02. Conditions to Defeasance..................................................................... 81
SECTION 8.03. Application of Trust Money................................................................... 82
SECTION 8.04. Repayment to Company......................................................................... 83
SECTION 8.05. Indemnity for Government Obligations......................................................... 83
SECTION 8.06. Reinstatement................................................................................ 83
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Holders................................................................... 84
SECTION 9.02. With Consent of Holders...................................................................... 85
SECTION 9.03. Compliance with Trust Indenture Act.......................................................... 86
SECTION 9.04. Revocation and Effect of Consents and Waivers................................................ 86
SECTION 9.05. Notation on or Exchange of Securities........................................................ 86
SECTION 9.06. Trustee To Sign Amendments................................................................... 87
SECTION 9.07. Payment for Consent.......................................................................... 87
ARTICLE 10
Subordination
SECTION 10.01. Agreement To Subordinate..................................................................... 87
SECTION 10.02. Liquidation, Dissolution, Bankruptcy......................................................... 87
SECTION 10.03. Default on Senior Indebtedness of the Company................................................ 88
SECTION 10.04. Acceleration of Payment of Securities........................................................ 89
SECTION 10.05. When Distribution Must Be Paid Over.......................................................... 90
SECTION 10.06. Subrogation.................................................................................. 90
SECTION 10.07. Relative Rights.............................................................................. 90
SECTION 10.08. Subordination May Not Be Impaired by Company................................................. 90
SECTION 10.09. Rights of Trustee and Paying Agent........................................................... 91
SECTION 10.10. Distribution or Notice to Representative..................................................... 91
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right To Accelerate..................... 91
SECTION 10.12. Trust Moneys Not Subordinated................................................................ 91
SECTION 10.13. Trustee Entitled To Rely..................................................................... 92
SECTION 10.14. Trustee To Effectuate Subordination.......................................................... 92
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness of the Company...................... 93
SECTION 10.16. Reliance by Holders of Senior Indebtedness of the Company on Subordination Provisions........ 93
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ARTICLE 11
Guaranties
SECTION 11.01. Guaranties................................................................................... 93
SECTION 11.02. Limitation on Liability...................................................................... 96
SECTION 11.03. Successors and Assigns....................................................................... 96
SECTION 11.04. No Waiver.................................................................................... 96
SECTION 11.05. Modification................................................................................. 96
SECTION 11.06. Release of Subsidiary Guarantor.............................................................. 96
ARTICLE 12
Subordination of Guaranties
SECTION 12.01. Agreement To Subordinate..................................................................... 97
SECTION 12.02. Liquidation, Dissolution, Bankruptcy......................................................... 97
SECTION 12.03. Default on Senior Indebtedness of Guarantor.................................................. 98
SECTION 12.04. Demand for Payment........................................................................... 99
SECTION 12.05. When Distribution Must Be Paid Over.......................................................... 100
SECTION 12.06. Subrogation.................................................................................. 100
SECTION 12.07. Relative Rights.............................................................................. 100
SECTION 12.08. Subordination May Not Be Impaired by Company................................................. 100
SECTION 12.09. Rights of Trustee and Paying Agent........................................................... 101
SECTION 12.10. Distribution or Notice to Representative..................................................... 101
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right To Demand Payment................. 101
SECTION 12.12. Trustee Entitled To Rely..................................................................... 101
SECTION 12.13. Trustee To Effectuate Subordination.......................................................... 102
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness of Guarantor....................... 102
SECTION 12.15. Reliance by Holders of Senior Indebtedness of Guarantors on Subordination Provisions......... 102
ARTICLE 13
Miscellaneous
SECTION 13.01. Trust Indenture Act Controls................................................................. 103
SECTION 13.02. Notices...................................................................................... 103
SECTION 13.03. Communication by Holders with Other Holders.................................................. 104
SECTION 13.04. Certificate and Opinion as to Conditions Precedent........................................... 104
SECTION 13.05. Statements Required in Certificate or Opinion................................................ 104
SECTION 13.06. When Securities Disregarded.................................................................. 105
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar................................................. 105
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SECTION 13.08. Legal Holidays............................................. 105
SECTION 13.09. Governing Law.............................................. 105
SECTION 13.10. No Recourse Against Others................................. 105
SECTION 13.11. Successors................................................. 106
SECTION 13.12. Multiple Originals......................................... 106
SECTION 13.13. Table of Contents; Headings................................ 106
6
Rule 144A/Regulation S Appendix
Exhibit 1 - Form of Initial Security
Exhibit A - Form of Exchange Security or Private Exchange Security
1
INDENTURE dated as of June 7, 2001, between XXXX XX CORP., a
Delaware corporation (the "Company"), CBRE HOLDING, INC.
("Parent") and STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA,
N.A. (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company's Initial
Securities, Exchange Securities and Private Exchange Securities (collectively,
the "Securities"):
ARTICLE 1
Definitions and Incorporation by Reference
------------------------------------------
SECTION 1.01. Definitions.
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"Additional Assets" means (1) any property or other assets (other than
Indebtedness and Capital Stock) used in a Related Business; (2) the Capital
Stock of a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Restricted
Subsidiary; or (3) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; provided, however, that any such
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Restricted Subsidiary described in clause (2) or (3) above is primarily engaged
in a Related Business.
"Additional Securities" means, subject to the Company's compliance with
Section 4.03, 11 1/4% Senior Subordinated Notes Due June 15, 2011 issued from
time to time after the Issue Date under the terms of this Indenture (other then
pursuant to Section 2.06, 2.07, 2.09 or 3.06 of this Indenture and other than
Exchange Securities or Private Exchange Securities issued pursuant to an
exchange offer for other Securities outstanding under this Indenture).
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.04, 4.06 and 4.07 only, "Affiliate" shall also
2
mean any beneficial owner of Capital Stock representing 10% or more of the total
voting power of the Voting Stock (on a fully diluted basis) of the Company or of
rights or warrants to purchase such Capital Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other disposition
(or series of related sales, leases, transfers or dispositions) by the Company
or any Restricted Subsidiary, including any disposition by means of a merger,
consolidation or similar transaction (each referred to for the purposes of this
definition as a "disposition"), of
(1) any shares of Capital Stock of a Restricted Subsidiary (other
than directors' qualifying shares or shares required by applicable law to
be held by a Person other than the Company or a Restricted Subsidiary),
(2) all or substantially all the assets of any division or line of
business of the Company or any Restricted Subsidiary or
(3) any other assets of the Company or any Restricted Subsidiary
outside of the ordinary course of business of the Company or such
Restricted Subsidiary
(other than, in the case of (1), (2) and (3) above, (A) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Restricted Subsidiary, (B) for purposes of Section 4.06 only, a
disposition that constitutes a Restricted Payment permitted by Section 4.04 or a
Permitted Investment, (C) the sale by Melody of assets purchased and/or funded
pursuant to the Melody Mortgage Warehousing Facility or the Melody Loan
Arbitrage Facility, (D) any sale of Capital Stock in, or Indebtedness or other
securities of, an Unrestricted Subsidiary, (E) a disposition of Temporary Cash
Investments in the ordinary course of business, (F) the disposition of property
or assets that are obsolete, damaged or worn out, (G) the lease or sublease of
office space in the ordinary course of business, (H) sales by Melody of debt
servicing rights not in excess of $5.0 million in the aggregate and (I) a
disposition of assets with a fair market value of less than $750,000 (a "de
minimis disposition"), so long as the sum of such de minimis disposition plus
all other de minimis dispositions previously made in the same calendar year does
not exceed $3.0 million in the aggregate);
3
provided, however, that a disposition of all or substantially all the assets of
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the Company and its Restricted Subsidiaries taken as a whole will be governed by
Section 4.09 and/or Section 5.01 and not by Section 4.06.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means, as
at the time of determination, the present value (discounted at the interest rate
borne by the Securities, compounded annually) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
such Sale/Leaseback Transaction (including any period for which such lease has
been extended); provided, however, that if such Sale/Leaseback Transaction
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results in a Capital Lease Obligation, the amount of Indebtedness represented
thereby will be determined in accordance with the definition of "Capital Lease
Obligation".
"Average Life" means, as of the date of determination, with respect to
any Indebtedness the quotient obtained by dividing (1) the sum of the products
of the number of years from the date of determination to the dates of each
successive scheduled principal payment of or redemption or similar payment with
respect to such Indebtedness multiplied by the amount of such payment by (2) the
sum of all such payments.
"Bank Indebtedness" means all Obligations pursuant to the Credit
Agreement.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligation" means an obligation that is required to be
classified and accounted for as a capital lease for financial reporting purposes
in accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" of any Person means any and all shares, interests, rights
to purchase, warrants, options, participation or other equivalents of or
interests in
4
(however designated) equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.
"Cash Equity Contributions" shall mean (a) the contribution to Parent of
not less than $98,800,000 in cash in the form of equity (it being understood
that (i) any contribution to Parent by RCBA of shares of common equity of CB
Xxxxxxx Xxxxx Services in excess of 2,345,900 shares will be considered a cash
contribution by RCBA in an amount equal to $16.00 multiplied by the number of
shares constituting such excess and a contribution of such amount from Parent to
the Company and (ii) the transfer by designated managers of an aggregate of up
to $2.6 million of deferred compensation plan account balances (currently
reflected as cash surrender value of insurance policies, deferred compensation
plan in the financial statements of the Company) to stock fund units shall be
deemed to be a cash contribution to Parent of the amount of such transfer and a
contribution of such amount from Parent to the Company to the extent (x)
accounted for as equity of the Company and (y) such transfer of an account
balance results in a transfer to the Company of cash from the trust relating to
such deferred compensation plan) and (b) the contribution by Parent of the
amount so received, together with the net proceeds from its sale of the Parent
Senior Notes, to the Company as equity in exchange for Capital Stock (other than
Disqualified Stock) of the Company.
"CB Xxxxxxx Xxxxx Services" means CB Xxxxxxx Xxxxx Services, Inc., a
Delaware corporation.
"Change of Control" means the occurrence of any of the following events:
(1) prior to the earlier to occur of (A) the first underwritten
public offering of common stock of Parent or (B) the first public offering
of common stock of the Company, (x) the Permitted Holders cease to be the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act), directly or indirectly, of a majority in the aggregate of the total
voting power of the Voting Stock of the Company, whether as a result of
issuance of securities of Parent or the Company, any merger, consolidation,
liquidation or dissolution of Parent or the Company, or any direct or
indirect transfer of securities by Parent or otherwise and (y) RCBA ceases
to (i) be the beneficial owner, directly or indirectly, of at least 35% of
the total voting power of the Voting Stock of the Company or (ii) have the
right or ability by voting power,
5
contract or otherwise to elect or designate for election a majority of the
Board of Directors (for purposes of this clause (1) and clause (2) below,
the Permitted Holders shall be deemed to beneficially own any Voting Stock
of a Person (the "specified Person") held by any other Person (the "parent
entity") so long as the Permitted Holders beneficially own (as so defined),
directly or indirectly, (1) in the case of a parent entity that is Parent,
in the aggregate at least 35% of the voting power of the Voting Stock of
Parent and have the right or ability by voting power, contract or otherwise
to elect or designate for election a majority of the Board of Directors or
(2) in the case of any other parent entity, in the aggregate a majority of
the voting power of the Voting Stock of the parent entity);
(2) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than one or more Permitted Holders, is or
becomes the beneficial owner (as defined in clause (1) above, except that
for purposes of this clause (2) such person shall be deemed to have
"beneficial ownership" of all shares that any such person has the right to
acquire, whether such right is exercisable immediately or only after the
passage of time and except that any Person that is deemed to have
beneficial ownership of shares solely as the result of being part of a
group pursuant to Rule 13d-5(b)(1) shall be deemed not to have beneficial
ownership of any shares held by a Permitted Holder forming a part of such
group), directly or indirectly, of more than 35% of the total voting power
of the Voting Stock of the Company; provided, however, that the Permitted
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Holders beneficially own (as defined in clause (1) above , except that in
the event the Permitted Holders are part of a group pursuant to Rule 13d-
5(b)(1), the Permitted Holders shall be deemed not to have beneficial
ownership of any shares held by persons other than Permitted Holders
forming a part of such group), directly or indirectly, in the aggregate a
lesser percentage of the total voting power of the Voting Stock of the
Company than such other person and do not have the right or ability by
voting power, contract or otherwise to elect or designate for election a
majority of the Board of Directors (for the purposes of this clause (2),
such other person shall be deemed to beneficially own any Voting Stock of a
specified Person held by a parent entity, if such other person is the
beneficial owner (as defined in this clause (2)), directly or indirectly,
of more than 35% of the voting power of the Voting Stock of such parent
6
entity and the Permitted Holders beneficially own (as defined in clause (1)
above), directly or indirectly, in the aggregate a lesser percentage of the
voting power of the Voting Stock of such parent entity and do not have the
right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of such parent
entity);
(3) individuals who on the Merger Date constituted the Board of
Directors (together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of the
Company was approved by a vote of a majority of the directors of the
Company then still in office who were either directors on the Issue Date or
whose election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the Board of Directors then in
office;
(4) the adoption of a plan relating to the liquidation or dissolution
of the Company; or
(5) the merger or consolidation of the Company with or into another
Person or the merger of another Person with or into the Company, or the
sale of all or substantially all the assets of the Company (determined on a
consolidated basis) to another Person (other than, in all such cases, a
Person that is controlled by the Permitted Holders), other than a
transaction following which (A) in the case of a merger or consolidation
transaction, holders of securities that represented 100% of the Voting
Stock of the Company immediately prior to such transaction (or other
securities into which such securities are converted as part of such merger
or consolidation transaction) own directly or indirectly at least a
majority of the voting power of the Voting Stock of the surviving Person in
such merger or consolidation transaction immediately after such transaction
and in substantially the same proportion as before the transaction and (B)
in the case of a sale of assets transaction, the transferee Person becomes
the obligor in respect of the Securities and a Subsidiary of the transferor
of such assets.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision
7
contained herein and required by the TIA, each other obligor on the indenture
securities.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of
(x) the aggregate amount of EBITDA for the period of the most recent
four consecutive fiscal quarters for which internal financial statements
are available ending prior to the date of such determination to
(y) Consolidated Interest Expense for such four fiscal quarters;
provided, however, that
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(1) if the Company or any Restricted Subsidiary has Incurred any
Indebtedness since the beginning of such period that remains outstanding or
if the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio is an Incurrence of Indebtedness, or both, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such period,
(2) if the Company or any Restricted Subsidiary has repaid,
repurchased, defeased or otherwise discharged any Indebtedness since the
beginning of such period or if any Indebtedness is to be repaid,
repurchased, defeased or otherwise discharged (in each case other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the
date of the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense for
such period shall be calculated on a pro forma basis as if such discharge
had occurred on the first day of such period and as if the Company or such
Restricted Subsidiary has not earned the interest income actually earned
during such period in respect of cash or Temporary Cash Investments used to
repay, repurchase, defease or otherwise discharge such Indebtedness,
(3) if since the beginning of such period the Company or any
Restricted Subsidiary shall have made any Asset Disposition, EBITDA for
such period shall be reduced by an amount equal to EBITDA (if positive)
directly attributable to the assets which are the
8
subject of such Asset Disposition for such period, or increased by an
amount equal to EBITDA (if negative), directly attributable thereto for
such period and Consolidated Interest Expense for such period shall be
reduced by an amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any Restricted
Subsidiary repaid, repurchased, defeased or otherwise discharged with
respect to the Company and its continuing Restricted Subsidiaries in
connection with such Asset Disposition for such period (or, if the Capital
Stock of any Restricted Subsidiary is sold, the Consolidated Interest
Expense for such period directly attributable to the Indebtedness of such
Restricted Subsidiary to the extent the Company and its continuing
Restricted Subsidiaries are no longer liable for such Indebtedness after
such sale),
(4) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any person which becomes a
Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction requiring
a calculation to be made hereunder, which constitutes all or substantially
all of an operating unit of a business, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto (including the Incurrence of any Indebtedness) as if such
Investment or acquisition occurred on the first day of such period and
(5) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary or was merged with or into the
Company or any Restricted Subsidiary since the beginning of such period)
shall have made any Asset Disposition, any Investment or acquisition of
assets that would have required an adjustment pursuant to clause (3) or (4)
above if made by the Company or a Restricted Subsidiary during such period,
EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto as if such Asset
Disposition, Investment or acquisition occurred on the first day of such
period.
For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any
9
Indebtedness Incurred in connection therewith, the pro forma calculations shall
be determined in good faith by a responsible financial or accounting Officer of
the Company (and shall include any applicable Pro Forma Cost Savings). If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest on such Indebtedness shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in excess of
12 months).
"Consolidated Interest Expense" means, for any period, the total interest
expense of the Company and its consolidated Restricted Subsidiaries, plus, to
the extent not included in such total interest expense, and to the extent
incurred by the Company or its Restricted Subsidiaries, without duplication,
(1) interest expense attributable to Capital Lease Obligations and
the interest expense attributable to leases constituting part of a
Sale/Leaseback Transaction,
(2) amortization of debt discount and debt issuance cost,
(3) capitalized interest,
(4) non-cash interest expense,
(5) commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing,
(6) net payments pursuant to Hedging Obligations in respect of
Indebtedness,
(7) Preferred Stock dividends in respect of all Preferred Stock held
by Persons other than the Company or a Restricted Subsidiary (other than
dividends payable solely in Capital Stock (other than Disqualified Stock)
of the issuer of such Preferred Stock),
(8) interest incurred in connection with Investments in discontinued
operations,
(9) interest accruing on any Indebtedness of any other Person to the
extent such Indebtedness is
10
Guaranteed by (or secured by the assets of) the Company or any Restricted
Subsidiary and
(10) the cash contributions to any employee stock ownership plan or
similar trust to the extent such contributions are used by such plan or
trust to pay interest or fees to any Person (other than the Company) in
connection with Indebtedness Incurred by such plan or trust,
and less, to the extent included in such total interest expense, (A) the
amortization during such period of capitalized financing costs associated with
the Transactions and (B) the amortization during such period of other
capitalized financing costs; provided, however, that the aggregate amount of
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amortization relating to any such other capitalized financing costs deducted in
calculating Consolidated Interest Expense shall not exceed 3.5% of the aggregate
amount of the financing giving rise to such capitalized financing costs.
"Consolidated Net Income" means, for any period, the sum of (1) the net
income of the Company and its consolidated Subsidiaries and (2) to the extent
deducted in calculating net income of the Company and its consolidated
Subsidiaries, (A) any non-recurring fees, expenses or charges related to the
Transactions and (B) any non- recurring charges related to one-time severance or
lease termination costs incurred in connection with the Transactions; provided,
--------
however, that there shall not be included in such Consolidated Net Income:
-------
(1) any net income of any Person (other than the Company) if such
Person is not a Restricted Subsidiary, except that
(A) subject to the exclusion contained in clause (4) below, the
Company's equity in the net income of any such Person for such period
shall be included in such Consolidated Net Income up to the aggregate
amount of cash actually distributed by such Person during such period
to the Company or a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution
paid to a Restricted Subsidiary, to the limitations contained in
clause (3) below) and
(B) the Company's equity in a net loss of any such Person to the
extent accounted for pursuant to the equity method of accounting for
such period
11
shall be included in determining such Consolidated Net Income;
(2) any net income (or loss) of any Person acquired by the Company or
a Subsidiary in a pooling of interests transaction for any period prior to
the date of such acquisition;
(3) any net income of any Restricted Subsidiary if such Restricted
Subsidiary is subject to restrictions, directly or indirectly, on the
payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that
(A) subject to the exclusion contained in clause (4) below, the
Company's equity in the net income of any such Restricted Subsidiary
for such period shall be included in such Consolidated Net Income up
to the aggregate amount of cash actually distributed by such
Restricted Subsidiary during such period to the Company or another
Restricted Subsidiary as a dividend or other distribution (subject, in
the case of a dividend or other distribution paid to another
Restricted Subsidiary, to the limitation contained in this clause) and
(B) the Company's equity in a net loss of any such Restricted
Subsidiary for such period shall be included in determining such
Consolidated Net Income;
(4) any gain (or loss) realized upon the sale or other disposition of
any assets of the Company, its consolidated Subsidiaries or any other
Person (including pursuant to any sale-and-leaseback arrangement) which is
not sold or otherwise disposed of in the ordinary course of business and
any gain (or loss) realized upon the s ale or other disposition of any
Capital Stock of any Person;
(5) extraordinary gains or losses;
(6) the cumulative effect of a change in accounting principles;
(7) any income or losses attributable to discontinued operations
(including operations disposed of during such periods whether or not such
operations were classified as discontinued);
12
(8) 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; and
(9) if the Successor Company is not the Company, the aggregate net
income (or loss)of such Successor Company prior to the consolidation,
merger or transfer resulting in such Successor Company.
Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall
be excluded from Consolidated Net Income any repurchases, repayments or
redemptions of Investments, proceeds realized on the sale of Investments or
return of capital to the Company or a Restricted Subsidiary to the extent such
repurchases, repayments, redemptions, proceeds or returns increase the amount of
Restricted Payments permitted under such Section pursuant to Section
4.04(a)(3)(D).
"Credit Agreement" means the Credit Agreement to be entered into among CB
Xxxxxxx Xxxxx Services, Parent, as guarantor, the lenders referred to therein,
Credit Suisse First Boston, as Administrative Agent Sole Lead Arranger and Sole
Book Manager, and the Syndication Agent and Documentation Agent named therein,
together with the related documents thereto (including the term loans and
revolving loans thereunder, any guarantees and security documents), as amended,
extended, renewed, restated, supplemented or otherwise modified (in whole or in
part, and without limitation as to amount, terms, conditions, covenants and
other provisions) from time to time, and any agreement (and related document)
governing Indebtedness incurred to Refinance, in whole or in part, the
borrowings and commitments then outstanding or permitted to be outstanding under
such Credit Agreement or a successor Credit Agreement, whether by the same or
any other lender or group of lenders.
"Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement designed to protect
such Person against fluctuations in currency values.
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"Designated Senior Indebtedness", with respect to a Person, means (1) the
Bank Indebtedness and (2) any other Senior Indebtedness of such Person which, at
the date of determination, has an aggregate principal amount outstanding
13
of, or under which, at the date of determination, the holders thereof are
committed to lend up to, at least $25.0 million and is specifically designated
by such Person in the instrument evidencing or governing such Senior
Indebtedness as "Designated Senior Indebtedness" for purposes of this Indenture.
"Disqualified Stock" means, with respect to any Person, 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 at the option of the holder) or upon the
happening of any event:
(1) matures or is mandatorily redeemable pursuant to a sinking fund
obligation or otherwise;
(2) is convertible or exchangeable at the option of the holder for
Indebtedness or Disqualified Stock; or
(3) is mandatorily redeemable or must be purchased upon the
occurrence of certain events or otherwise, in whole or in part, in each case on
or prior to the first anniversary of the Stated Maturity of the Securities;
provided, however, that if such Capital Stock is issued to any employee or to
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any plan for the benefit of employees of the Company or its Subsidiaries or by
any such plan to such employees, such Capital Stock shall not constitute
Disqualified Stock solely because it may be required to be repurchased by the
Company in order to satisfy obligations as a result of such employee's death or
disability; and provided further, however, that any Capital Stock that would not
-------- ------- -------
constitute Disqualified Stock but for provisions thereof giving holders thereof
the right to require such Person to purchase or redeem such Capital Stock upon
the occurrence of an "asset sale" or "change of control" occurring prior to the
first anniversary of the Stated Maturity of the Securities shall not constitute
Disqualified Stock if (1) the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable to the holders of such
Capital Stock than the terms applicable to the Securities in Sections 4.06 and
4.09 of this Indenture and (2) any such requirement only becomes operative after
compliance with such terms applicable to the Securities, including the purchase
of any Securities tendered pursuant thereto.
The amount of any Disqualified Stock that does not have a fixed redemption,
repayment or repurchase price will be calculated in accordance with the terms of
such Disqualified
14
Stock as if such Disqualified Stock were redeemed, repaid or repurchased on any
date on which the amount of such Disqualified Stock is to be determined pursuant
to the Indenture; provided, however, that if such Disqualified Stock could not
-------- -------
be required to be redeemed, repaid or repurchased at the time of such
determination, the redemption, repayment or repurchase price will be the book
value of such Disqualified Stock as reflected in the most recent financial
statements of such Person.
"EBITDA" for any period means the sum of Consolidated Net Income, plus
the following to the extent deducted in calculating such Consolidated Net
Income:
(1) all income tax expense of the Company and its consolidated
Restricted Subsidiaries,
(2) Consolidated Interest Expense,
(3) any non-recurring fees, expenses or charges related to any Equity
Offering, Permitted Investment, acquisition or Incurrence of Indebtedness
permitted to be Incurred by the Indenture (in each case, whether or not
successful), including any such fees, expenses or charges related to the
Transactions, in each case not exceeding $5.0 million in the aggregate for
all such non-recurring fees, expenses and charges attributable to the same
transaction or event (or group of related transactions or events),
(4) depreciation and amortization expense of the Company and its
consolidated Restricted Subsidiaries (excluding amortization expense
attributable to a prepaid operating activity item that was paid in cash in
a prior period),
(5) all other non-cash losses, expenses and charges of the Company
and its consolidated Restricted Subsidiaries (excluding any such non-cash
loss, expense or charge to the extent that it represents an accrual of or
reserve for cash expenditures in any future period), and
(6) any non-recurring charges that are incurred and associated with
the restructuring of the operations of the Company and its consolidated
Subsidiaries announced prior to the Issue Date and implemented within 90
days after the Merger Date,
in each case for such period. Notwithstanding the foregoing, the provision for
taxes based on the income or
15
profits of, and the depreciation and amortization and non-cash charges of, a
Restricted Subsidiary shall be added to Consolidated Net Income to compute
EBITDA only to the extent (and in the same proportion) that the net income of
such Restricted Subsidiary was included in calculating Consolidated Net Income
and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders.
"Equity Offering" means any primary offering of Capital Stock of Parent
or the Company (other than Disqualified Stock)to Persons who are not Affiliates
of the Company other than (1) public offerings with respect to the Company's
Common Stock registered on Form S-8 and (2) issuances upon exercise of options
by employees of the Company or any of its Restricted Subsidiaries.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exempt Subsidiary" means any Restricted Subsidiary that shall have had
aggregate EBITDA of less than $250,000 for the period of the most recent four
consecutive fiscal quarters for which internal financial statements are
available ending prior to the date of the issuance or sale of its Capital Stock
giving rise to such determination; provided, however, that such sale or issuance
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is pursuant to a plan or program for the sale or issuance of Capital Stock a
majority of which is sold to local management or to local strategic investors.
"Facilities" means the Term Loan Facilities and the Revolving Credit
Facilities.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary not
incorporated or organized under the laws of the United States of America, any
State thereof or the District of Columbia.
"Xxxxxxx Xxxxxx" means collectively, (1) FS Equity Partners III, L.P.,
(2) FS Equity Partners International L.P., (3) any investment fund that is
affiliated with Xxxxxxx Xxxxxx & Co. Incorporated and (4) Xxxxxxx Xxxxxx & Co.
Incorporated and any successor entity thereof controlled by the principals of
Xxxxxxx Xxxxxx & Co. Incorporated or
16
any entity controlled by, or under common control with, Xxxxxxx Xxxxxx & Co.
Incorporated.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in
(1) the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants,
(2) statements and pronouncements of the Financial Accounting
Standards Board,
(3) such other statements by such other entity as approved by a
significant segment of the accounting profession and
(4) the rules and regulations of the SEC governing the inclusion of
financial statements (including pro forma financial statements) in periodic
reports required to be filed pursuant to Section 13 of the Exchange Act,
including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC. Except as
otherwise provided herein, all ratios and computations based on GAAP
contained in this Indenture shall be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness of any Person and any
obligation, direct or indirect, contingent or otherwise, of such Person
(1) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness of such Person (whether arising by virtue
of partnership arrangements, or by agreements to keep-well, to purchase
assets, goods, securities or services, to take-or-pay or to maintain
financial statement conditions or otherwise) or
(2) entered into for the purpose of assuring in any other manner the
obligee of such Indebtedness of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part); provided,
--------
however, that the term "Guarantee" shall not include endorsements for
-------
collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
17
"Guarantor" means Parent and/or a Subsidiary Guarantor.
"Guaranty" means the Parent Guaranty and/or a Subsidiary Guaranty.
"Guaranty Agreement" means a supplemental indenture, in a form
satisfactory to the Trustee, pursuant to which a Guarantor guarantees the
Company's obligations with respect to the Securities on the terms provided for
in this Indenture.
"Hedging Obligations" of any Person means the obligations of such Person
pursuant to any Interest Rate Agreement or Currency Agreement or similar
agreement.
"Holder" or "Securityholder" means the Person in whose name a Security is
registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become liable
for; provided, however, that any Indebtedness or Capital Stock of a Person
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existing at the time such Person becomes a Restricted Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred
by such Person at the time it becomes a Restricted Subsidiary. The term
"Incurrence" when used as a noun shall have a correlative meaning. Solely for
purposes of determining compliance with Section 4.03, (1) amortization of debt
discount or the accretion of principal with respect to a noninterest bearing or
other discount security and (2) the payment of regularly scheduled interest in
the form of additional Indebtedness of the same instrument or the payment of
regularly scheduled dividends on Capital Stock in the form of additional Capital
Stock of the same class and with the same terms will not be deemed to be the
Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(1) the principal in respect of (A) indebtedness of such Person for
money borrowed and (B) indebtedness evidenced by notes, debentures, bonds
or other similar instruments for the payment of which such Person is
responsible or liable, including, in each case, any premium on such
indebtedness to the extent such premium has become due and payable;
18
(2) all Capital Lease Obligations of such Person and all Attributable
Debt in respect of Sale/Leaseback Transactions entered into by such Person;
(3) all obligations of such Person issued or assumed as the deferred
purchase price of property, all conditional sale obligations of such Person
and all obligations of such Person under any title retention agreement (but
excluding trade accounts payable arising in the ordinary course of
business);
(4) all obligations of such Person for the reimbursement of any
obligor on any letter of credit, banker's acceptance or similar credit
transaction (other than obligations with respect to letters of credit
securing obligations (other than obligations described in clauses (1)
through (3) above) entered into in the ordinary course of business of such
Person to the extent such letters of credit are not drawn upon or, if and
to the extent drawn upon, such drawing is reimbursed no later than the
twentieth Business Day following payment on the letter of credit);
(5) the amount of all obligations of such Person with respect to the
redemption, repayment or other repurchase of any Disqualified Stock of such
Person or, with respect to any Preferred Stock of any Subsidiary of such
Person, the principal amount of such Preferred Stock to be determined in
accordance with Section 1.04(7) (but excluding, in each case, any accrued
dividends);
(6) all obligations of the type referred to in clauses (1) through
(5) of other Persons and all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise, including by means of any
Guarantee;
(7) all obligations of the type referred to in clauses (1) through
(6) of other Persons secured by any Lien on any property or asset of such
Person (whether or not such obligation is assumed by such Person), the
amount of such obligation being deemed to be the lesser of the value of
such property or assets and the amount of the obligation so secured; and
(8) to the extent not otherwise included in this definition, Hedging
Obligations of such Person.
19
Notwithstanding the foregoing, in connection with the purchase by the Company or
any Restricted Subsidiary of any business, the term "Indebtedness" will exclude
post-closing payment adjustments to which the seller may become entitled to the
extent such payment is determined by a final closing balance sheet or such
payment depends on the performance of such business after the closing; provided,
--------
however, that, at the time of closing, the amount of any such payment is not
-------
determinable and, to the extent such payment thereafter becomes fixed and
determined, the amount is paid within 30 days thereafter. Indebtedness of any
Person shall include all Indebtedness of any partnership or other entity in
which such Person is a general partner or other equity holder with unlimited
liability other than Indebtedness which by its terms is non-recourse to such
Person and its assets.
The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations at such date provided,
--------
however, that the principal amount of any noninterest bearing or other discount
-------
security at any date will be the principal amount thereof that would be shown on
a balance sheet of such Person dated such date prepared in accordance with GAAP.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Independent Qualified Party" means an investment banking firm,
accounting firm or appraisal firm of national standing; provided, however, that
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such firm is not an Affiliate of the Company.
"Interest Rate Agreement" means in respect of a Person any interest rate
swap agreement, interest rate cap agreement or other financial agreement or
arrangement designed to protect such Person against fluctuations in interest
rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of the lender) or other
extensions of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock,
20
Indebtedness or other similar instruments issued by such Person. Except as
otherwise provided for herein, the amount of an Investment shall be its fair
market value at the time the Investment is made and without giving effect to
subsequent changes in value.
For purposes of the definition of "Unrestricted Subsidiary", the
definition of "Restricted Payment" and Section 4.04,
(1) "Investment" shall include the portion (proportionate to the
Company's equity interest in such Subsidiary) of the fair market value of
the net assets of any Subsidiary of the Company at the time that such
Subsidiary is designated an Unrestricted Subsidiary; provided, however,
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that upon a redesignation of such Subsidiary as a Restricted Subsidiary,
the Company shall be deemed to continue to have a permanent "Investment" in
an Unrestricted Subsidiary equal to an amount (if positive) equal to (x)
the Company's "Investment" in such Subsidiary at the time of such
redesignation less (y) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the fair market value of the net assets of
such Subsidiary at the time of such redesignation; and
(2) any property transferred to or from an Unrestricted Subsidiary
shall be valued at its fair market value at the time of such transfer, in
each case as determined in good faith by the Board of Directors.
"Investment Grade Rating" means a rating equal to or higher than Baa3 (or
the equivalent) and BBB- (or the equivalent) by Xxxxx'x Investors Service, Inc.
(or any successor to the rating agency business thereof) and Standard & Poor's
Ratings Group (or any successor to the rating agency business thereof),
respectively.
"Issue Date" means June 7, 2001.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"Melody" means X.X. Xxxxxx & Company, a Texas corporation.
"Melody Loan Arbitrage Facility" means a credit facility provided to
Melody by any depository bank in which Melody deposits payments relating to
mortgage loans for
21
which Melody is servicer prior to distribution of such payments to or for the
benefit of the holders of such loans, so long as (1) Melody applies all proceeds
of loans made under such credit facility to purchase Temporary Cash Investments
and (2) all such Temporary Cash Investments purchased by Melody with the
proceeds of loans thereunder (and proceeds thereof and distributions thereon)are
pledged to the depository bank providing such credit facility, and such bank has
a first priority perfected security interest therein, to secure loans made under
such credit facility.
"Melody Mortgage Warehousing Facility" means the credit facility provided
by Residential Funding Corporation ("RFC") or any substantially similar facility
extended to any Mortgage Banking Subsidiary in connection with any Mortgage
Banking Activities, pursuant to which RFC or another lender makes loans to
Melody, the proceeds of which loans are applied by Melody (or any Mortgage
Banking Subsidiary) to fund commercial mortgage loans originated and owned by
Melody (or any Mortgage Banking Subsidiary) subject to an unconditional,
irrevocable (subject to customary exceptions) commitment to purchase such
mortgage loans by the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association or any other quasi-federal governmental entity so
long as loans made by RFC or such other lender to Melody (or any Mortgage
Banking Subsidiary) thereunder are secured by a pledge of commercial mortgage
loans made by Melody (or any Mortgage Banking Subsidiary) with the proceeds of
such loans and RFC or such other lender has a perfected first priority security
interest therein, to secure loans made under such credit facility.
"Melody Permitted Indebtedness" means Indebtedness of Melody under the
Melody Loan Arbitrage Facility, the Melody Mortgage Warehousing Facility and the
Melody Working Capital Facility and Indebtedness of any Mortgage Banking
Subsidiary under the Melody Mortgage Warehousing Facility that is, in all cases,
non-recourse to the Company or any of its other Subsidiaries.
"Melody Working Capital Facility" means a credit facility provided by a
financial institution to Melody, so long as (1) the proceeds of loans thereunder
are applied only to provide working capital to Melody, (2) loans under such
credit facility are unsecured, and (3) the aggregate principal amount of loans
outstanding under such credit facility at no time exceeds $1.0 million.
"Merger" means the merger of XXXX XX Corp. with and into CB Xxxxxxx Xxxxx
Services pursuant to the Merger Agreement.
22
"Merger Agreement" means the amended and restated agreement and plan of
merger dated as of May 31, 2001, among CB Xxxxxxx Xxxxx Services, Parent and
Merger Sub, as such agreement may be further amended so long as such amendments
are not adverse to Holders, and all other documents entered into or delivered in
connection with the Merger Agreement.
"Merger Date" means the date the Merger is consummated.
"Mortgage Banking Activities" means the origination by a Mortgage Banking
Subsidiary of mortgage loans in respect of commercial and multi-family
residential real property, and the sale or assignment of such mortgage loans and
the related mortgages to another person (other than the Company or any of its
Subsidiaries) within sixty days after the origination thereof; provided,
--------
however, that in each case prior to origination of any mortgage loan, the
-------
Company or a Mortgage Banking Subsidiary, as the case may be, shall have entered
into a legally binding and enforceable purchase and sale agreement with respect
to such mortgage loan with a person that purchases such loans in the ordinary
course of business.
"Mortgage Banking Subsidiary" means Melody and its subsidiaries that are
engaged in Mortgage Banking Activities.
"Net Available Cash" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to such properties or assets or
received in any other noncash form), in each case net of
(1) all legal, accounting, investment banking and brokerage fees,
title and recording tax expenses, commissions and other fees and expenses
incurred, and all Federal, state, provincial, foreign and local taxes
required to be accrued as a liability under GAAP, as a consequence of such
Asset Disposition,
(2) all payments made on any Indebtedness which is secured by any
assets subject to such Asset Disposition, in accordance with the terms of
any Lien upon or other security agreement of any kind with
23
respect to such assets, or which must by its terms, or in order to obtain a
necessary consent to such Asset Disposition, or by applicable law, be
repaid out of the proceeds from such Asset Disposition,
(3) all distributions and other payments required to be made to
minority interest holders in Subsidiaries or joint ventures as a result of
such Asset Disposition and
(4) the deduction of appropriate amounts provided by the seller as a
reserve, in accordance with GAAP, against any liabilities associated with
the property or other assets disposed in such Asset Disposition and
retained by the Company or any Restricted Subsidiary after such Asset
Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Obligations" means with respect to any Indebtedness all obligations for
principal, premium, interest, penalties, fees, indemnifications, reimbursements,
and other amounts payable pursuant to the documentation governing such
Indebtedness.
"Offering Circular" means the Confidential Offering Circular dated May
31, 2001, as supplemented by the Supplement dated June 6, 2001, relating to the
Securities.
"Officer" means the Chairman of the Board, the Chief Executive Officer,
the President, the Chairman of the Americas, any Vice President, the Chief
Financial Officer, the Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.
"Parent" means CBRE Holding, Inc.
24
"Parent Senior Notes" means Parent's 16% Senior Notes Due 2011.
"Parent Guaranty" means the Guarantee by Parent of the Company's
obligations with respect to the Securities contained in this Indenture.
"Permitted Co-investment" means any Investment by any Restricted
Subsidiary which is formed solely to acquire up to 5% of the Capital Stock of
any Person (a "Co- investment Entity") managed by such Restricted Subsidiary
whose principal purpose is to invest, directly or indirectly, in commercial real
estate; provided, however, that such Restricted Subsidiary is acting in such
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capacity pursuant to an arrangement substantially similar to arrangements
entered into by Restricted Subsidiaries involved in such activities prior to the
Issue Date.
"Permitted Holders" means (1) RCBA and Xxxxxxx Xxxxxx, (2) any member of
senior management of the Company on the Merger Date and (3) DLJ Investment
Partners II, L.P. and its affiliates.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in
(1) the Company, a Restricted Subsidiary or a Person that will, upon
the making of such Investment, become a Restricted Subsidiary; provided,
--------
however, that (A) the primary business of such Restricted Subsidiary is a
-------
Related Business and (B) such Restricted Subsidiary is not restricted from
making dividends or similar distributions by contract, operation of law or
otherwise;
(2) another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers or conveys all
or substantially all its assets to, the Company or a Restricted Subsidiary;
provided, however, that such Person's primary business is a Related
-------- -------
Business;
(3) cash and Temporary Cash Investments;
(4) receivables owing to the Company or any Restricted Subsidiary if
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; provided, however,
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that such trade terms may include such concessionary trade terms as the
Company or any
25
such Restricted Subsidiary deems reasonable under the circumstances;
(5) payroll, travel, moving and similar advances to cover matters
that are expected at the time of such advances ultimately to be treated as
expenses for accounting purposes and that are made in the ordinary course
of business;
(6) loans or advances to employees or independent contractors made in
the ordinary course of business consistent with past practices of the
Company or such Restricted Subsidiary;
(7) loans or advances to clients and vendors made in the ordinary
course of business consistent with past practices of the Company or such
Restricted Subsidiary in an aggregate amount outstanding at any time not
exceeding $1.5 million;
(8) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Company or any
Restricted Subsidiary or in satisfaction of judgments;
(9) any Person to the extent such Investment represents the non-cash
portion of the consideration received for an Asset Disposition as permitted
pursuant to Section 4.06;
(10) any Person where such Investment was acquired by the Company or
any of its Restricted Subsidiaries (a) in exchange for any other Investment
or accounts receivable held by the Company or any such Restricted
Subsidiary in connection with or as a result of a bankruptcy, workout,
reorganization or recapitalization of the issuer of such other Investment
or accounts receivable or (b) as a result of a foreclosure by the Company
or any of its Restricted Subsidiaries with respect to any secured
Investment or other transfer of title with respect to any secured
Investment in default;
(11) Hedging Obligations entered into in the ordinary course of the
Company's or any Restricted Subsidiary's business and not for the purpose
of speculation;
(12) any Person to the extent such Investment replaces or refinances
an Investment in such Person existing on the Issue Date or on the Merger
Date in an
26
amount not exceeding the amount of the Investment being replaced or
refinanced; provided, however, the new Investment is on terms and
-------- -------
conditions no less favorable than the Investment being renewed or replaced;
(13) Investments in insurance on the life of any participant in any
deferred compensation plan of the Company made in the ordinary course of
business consistent with past practices of the Company;
(14) Permitted Co-investments in an aggregate amount not exceeding (a)
for the period from the day after the Merger Date to December 31, 2001, the
excess of $20.0 million over the aggregate amount of all such Investments
made in the period from January 1, 2001 to the Merger Date, and (b) $20.0
million in each calendar year thereafter; provided, however, that such
-------- -------
Investments made in Co-investment Entities investing in countries that are
not members of the Organization for Economic Co-operation and Development
shall not exceed $5.0 million in any calendar year; provided further,
-------- -------
however, that (x) at the time of such Investment, no Default shall have
-------
occurred and be continuing (or result therefrom)and (y) immediately after
giving pro forma effect to such Investment, the Company would be able to
Incur an additional $1.00 of Indebtedness pursuant to Section 4.03(a); and
(15) so long as no Default shall have occurred and be continuing (or
result therefrom), any Person in an aggregate amount which, when added
together with the amount of all the Investments made pursuant to this
clause (15) which at such time have not been repaid through repayments of
loans or advances or other transfers of assets, does not exceed $15.0
million (with the fair market value of each Investment being measured at
the time made and without giving effect to subsequent changes in value).
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the distribution of
assets upon any voluntary or involuntary liquidation or
27
dissolution of such Person, over shares of Capital Stock of any other class of
such Person.
"principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.
"Pro Forma Cost Savings" means, with respect to any period, the reduction
in costs that were
(1) directly attributable to an asset acquisition and calculated on a
basis that is consistent with Regulation S-X under the Securities Act in
effect and applied as of the Issue Date, or
(2) implemented by the business that was the subject of any such
asset acquisition within six months of the date of the asset acquisition
and that are supportable and quantifiable by the underlying accounting
records of such business,
as if, in the case of each of clause (1) and (2), all such reductions in costs
had been effected as of the beginning of such period.
"Public Equity Offering" means an underwritten primary public offering of
common stock of the Company pursuant to an effective registration statement
under the Securities Act.
"Purchase Money Indebtedness" means Indebtedness (including Capital Lease
Obligations) (1) consisting of the deferred purchase price of property,
conditional sale obligations, obligations under any title retention agreement,
other purchase money obligations and obligations in respect of industrial
revenue bonds or similar Indebtedness, in each case where the maturity of such
Indebtedness does not exceed the anticipated useful life of the asset being
financed, and (2) Incurred to finance the acquisition by the Company or a
Restricted Subsidiary of such asset, including additions and improvements;
provided, however, that any Lien arising in connection with any such
-------- -------
Indebtedness shall be limited to the specified asset being financed or, in the
case of real property or fixtures, including additions and improvements, the
real property on which such asset is attached; provided further, however, that
-------- ------- -------
such Indebtedness is Incurred within 180 days after such acquisition of such
assets by the Company or any Restricted Subsidiary.
28
"Rating Agencies" means Standard and Poor's Ratings Group and Xxxxx'x
Investors Service, Inc. or any successor to the respective rating agency
business thereof.
"RCBA" means (1) RCBA Strategic Partners, L.P., (2) XXXX Capital
Partners, L.P. and its successors and (3) any investment fund that is affiliated
with XXXX Capital Partners, L.P. or its successors.
"Refinance" means, in respect of any Indebtedness, to refinance, extend,
renew, refund, repay, prepay, redeem, defease or retire, or to issue other
Indebtedness in exchange or replacement for, such indebtedness. "Refinance d"
and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances any
Indebtedness of the Company or any Restricted Subsidiary existing on the Merger
Date or Incurred in compliance with this Indenture, including Indebtedness that
Refinances Refinancing Indebtedness; provided, however, that:
-------- -------
(1) such Refinancing Indebtedness has a Stated Maturity no earlier
than the Stated Maturity of the Indebtedness being Refinanced;
(2) such Refinancing Indebtedness has an Average Life at the time
such Refinancing Indebtedness is Incurred that is equal to or greater than
the Average Life of the Indebtedness being Refinanced, and
(3) such Refinancing Indebtedness has an aggregate principal amount
(or if Incurred with original issue discount, an aggregate issue price)
that is equal to or less than the aggregate principal amount (or if
Incurred with original issue discount, the aggregate accreted value) then
outstanding or committed (plus fees and expenses, including any premium and
defeasance costs) under the Indebtedness being Refinanced;
provided further, however, that Refinancing Indebtedness shall not include (A) -
-------- ------- -------
Indebtedness of a Restricted Subsidiary that Refinances Indebtedness of the
Company or (B) Indebtedness of the Company or a Restricted Subsidiary that
Refinances Indebtedness of an Unrestricted Subsidiary.
"Related Business" means any business in which the Company was engaged on
the Merger Date and any business related, ancillary or complementary to any
business of the Company in which the Company was engaged on the Merger Date.
29
"Representative" means, with respect to a Person, any trustee, agent or
representative (if any) for an issue of Senior Indebtedness of such Person.
"Restricted Payment" with respect to any Person means
(1) the declaration or payment of any dividends or any other
distributions of any sort in respect of its Capital Stock (including any
payment in connection with any merger or consolidation involving such
Person) or similar payment to the direct or indirect holders of its Capital
Stock (other than dividends or distributions payable solely in its Capital
Stock (other than Disqualified Stock) and dividends or distributions
payable solely to the Company or a Restricted Subsidiary, and other than
pro rata dividends or other distributions made by a Subsidiary that is not
a Wholly Owned Subsidiary to minority stockholders (or owners of an
equivalent interest in the case of a Subsidiary that is an entity other
than a corporation)),
(2) the purchase, redemption or other acquisition or retirement for
value of any Capital Stock of the Company held by any Person or of any
Capital Stock of a Restricted Subsidiary held by any Affiliate of the
Company (other than a Restricted Subsidiary), including the exercise of any
option to exchange any Capital Stock (other than into Capital Stock of the
Company that is not Disqualified Stock),
(3) the purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value, prior to scheduled maturity, scheduled
repayment or scheduled sinking fund payment of any Subordinated Obligations
of such Person (other than the purchase, repurchase, or other acquisition
of Subordinated Obligations purchased in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in each
case due within one year of the date of such purchase, repurchase or other
acquisition) or
(4) the making of any Investment (other than a Permitted Investment)
in any Person.
"Restricted Subsidiary" means any Subsidiary of the Company that is not
an Unrestricted Subsidiary.
"Revolving Credit Facility" means the revolving credit facility contained
in the Credit Agreement and any
30
other facility or financing arrangement that Refinances, in whole or in part,
and such revolving credit facility.
"Sale/Leaseback Transaction" means an arrangement relating to property
owned by the Company or a Restricted Subsidiary on the Issue Date or thereafter
acquired by the Company or a Restricted Subsidiary whereby the Company or a
Restricted Subsidiary transfers such property to a Person and the Company or a
Restricted Subsidiary leases it from such Person.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Secured Indebtedness" means any Indebtedness of the Company secured by a
Lien.
"Securities" means the Securities issued under this Indenture.
"Senior Indebtedness" means, with respect to a Person,
(1) Indebtedness of such Person, whether outstanding on the Issue
Date or thereafter Incurred, and
(2) accrued and unpaid interest (including interest accruing on or
after the filing of any petition in bankruptcy or for reorganization
relating to such Person whether or not post-filing interest is allowed in
such proceeding) in respect of (A) indebtedness of such Person for money
borrowed and (B) indebtedness evidenced by notes, debentures, bonds or
other similar instruments for the payment of which such Person is
responsible or liable
unless, in the case of clauses (1) and (2), in the instrument creating or
evidencing the same or pursuant to which the same is outstanding it is provided
that such obligations are subordinate or pari passu in right of payment to the
---- -----
Securities or the Subsidiary Guaranty of such Person, as the case may be;
provided, however, that Senior Indebtedness shall not include:
-------- -------
(1) any obligation of such Person to any Subsidiary;
31
(2) any liability for Federal, state, local or other taxes owed or
owing by such Person,
(3) any accounts payable or other liability to trade creditors
arising in the ordinary course of business (including guarantees thereof or
instruments evidencing such liabilities),
(4) any Indebtedness of such Person (and any accrued and unpaid
interest in respect thereof) which is subordinate or junior in any respect
to any other Indebtedness or other obligation of such Person or
(5) that portion of any Indebtedness which at the time of Incurrence
is Incurred in violation of this Indenture provided, however, that such
-------- -------
Indebtedness shall be deemed not to have been Incurred in violation of the
Indenture for purposes of this clause (5) if (x) the holders of such
Indebtedness or their representative or the Company shall have furnished to
the Trustee an opinion of recognized independent legal counsel, unqualified
in all material respects, addressed to the Trustee (which legal counsel
may, as to matters of fact, rely upon an Officers' Certificate) to the
effect that the Incurrence of such Indebtedness does not violate the
provisions of the Indenture or (y) such Indebtedness consists of Bank
Indebtedness, and the holders of such Indebtedness or their agent or
representative (1) had no actual knowledge at the time of the Incurrence
that the Incurrence of such Indebtedness violated the Indenture and (2)
shall have received an Officers' Certificate to the effect that the
Incurrence of such Indebtedness does not violate the provisions of the
Indenture.
"Senior Subordinated Indebtedness" means, with respect to a Person, the
Securities (in the case of the Company, a Guaranty (in the case of a Guarantor)
and any other Indebtedness of such Person that specifically provides that such
Indebtedness is to rank pari passu with the Securities or such Guaranty, as the
case may be; in right of payment and is not subordinated by its terms in right
of payment to any Indebtedness or other obligation of such Person which is not
Senior Indebtedness of such Person.
"Significant Subsidiary" means any Restricted Subsidiary that would be a
"Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.
32
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the final payment of principal of
such security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency unless such contingency has occurred).
"Subordinated Obligation" means, with respect to a Person, any
Indebtedness of such Person (whether outstanding on the Issue Date or thereafter
Incurred) which is subordinate or junior in right of payment to the Securities
or a Guaranty of such Person, as the case may be, pursuant to a written
agreement to that effect.
"Subsidiary" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Voting Stock is at the time owned or controlled,
directly or indirectly, by (1) such Person, (2) such Person and one or more
Subsidiaries of such Person or (3) one or more Subsidiaries of such Person.
"Subsidiary Guarantor" means each Subsidiary of the Company that executes
the Indenture as a guarantor or a Guaranty Agreement on the Merger Date and each
other Subsidiary of the Company that thereafter guarantees the Securities
pursuant to the terms of the Indenture.
"Subsidiary Guaranty" means a Guarantee by a Subsidiary Guarantor of the
Company's obligations with respect to the Securities.
"Temporary Cash Investments" means any of the following:
(1) any investment in direct obligations of the United States of
America or any agency thereof or obligations guaranteed by the United
States of America or any agency thereof,
(2) investments in time deposit accounts, bankers' acceptances,
certificates of deposit and money market deposits maturing within one year
of the date of acquisition thereof issued by a bank or trust company which
is organized under the laws of the United States of America, any State
thereof or any foreign country recognized by the United States of America,
and which bank or trust company has capital, surplus and undivided profits
aggregating in excess of $50,000,000
33
(or the foreign currency equivalent thereof) and has outstanding debt that
is rated "A" (or such similar equivalent rating) or higher by at least one
nationally recognized statistical rating organization (as defined in Rule
436 under the Securities Act) or any money- market fund sponsored by a
registered broker-dealer or mutual fund distributor,
(3) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (1) above and
clauses (4) and (5) below entered into with a bank meeting the
qualifications described in clause (2) above,
(4) investments in commercial paper, maturing not more than one year
from the date of creation thereof, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America or any foreign country recognized by the United
States of America with a rating at the time as of which any investment
therein is made of "P-1" (or higher) according to Xxxxx'x Investors
Service, Inc. or "A-1" (or higher) according to Standard and Poor's Ratings
Group,
(5) investments in securities with maturities of one year or less
from the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least "A"
by Standard & Poor's Ratings Group or "A" by Xxxxx'x Investors Service,
Inc., and
(6) other short-term investments utilized by Foreign Restricted
Subsidiaries in accordance with normal investment practices for cash
management in investments of a type analogous to the foregoing.
"Term Loan Facility" means the term loan facilities contained in the
Credit Agreement and any other facilities or financing arrangements that
Refinances in whole or in part any such term loan facility.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.(S).(S).
------
77aaa-77bbbb) as in effect on the date of this Indenture.
"Transactions" shall mean, collectively, the following transactions to
occur on or prior to the Merger Date: (a) the consummation of the Merger, (b)
the execution and delivery of the Credit Agreement and the initial
34
borrowings thereunder, (c) the execution and delivery of the Indenture relating
to the Parent Senior Notes and the issuance of the Parent Senior Notes, (d) the
closing of the tender offer for and the receipt of the requisite consents in
connection with the consent solicitation in respect of CB Xxxxxxx Xxxxx
Services' existing 8 7/8% Senior Subordinated Notes Due 2006, (e) the Cash
Equity Contribution and (f) the payment of all fees and expenses then due and
owing that are required to be paid on or prior to the Merger Date in connection
with the offering of the Securities.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Uniform Commercial Code" means the New York Uniform Commercial Code as
in effect from time to time.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Company that at the time of determination
shall be designated an Unrestricted Subsidiary by the Board of Directors in
the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary of the Company) to be an
Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns
any Capital Stock or Indebtedness 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, however, that either (A) the
-------- -------
Subsidiary to be so designated has total assets of $1,000 or less or (B) if such
Subsidiary has assets greater than $1,000, such designation would be permitted
under Section 4.04. The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided, however, that immediately
-------- -------
after giving effect to such designation (A) the Company could Incur $1.00 of
additional Indebtedness under Section 4.03(a) and (B) no Default shall have
occurred and be continuing. Any such designation by the Board of Directors shall
be evidenced to
35
the Trustee by promptly filing with the Trustee a copy of the resolution of the
Board of Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
provisions.
"U.S. Dollar Equivalent" means with respect to any monetary amount in a
currency other than U.S. dollars, at any time for determination thereof, the
amount of U.S. dollars obtained by converting such foreign currency involved in
such computation into U.S. dollars at the spot rate for the purchase of U.S.
dollars with the applicable foreign currency as published in The Wall Street
Journal in the "Exchange Rates" column under the heading "Currency Trading" on
the date two Business Days prior to such determination.
Except as described in Section 4.03, whenever it is necessary to
determine whether the Company has complied with any covenant in this Indenture
or a Default has occurred and an amount is expressed in a currency other than
U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent
determined as of the date such amount is initially determined in such currency.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all the Capital
Stock of which (other than directors' qualifying shares) is owned by the Company
or one or more Wholly Owned Subsidiaries.
36
SECTION 1.02. Other Definitions.
------------------
Defined in
Term Section
---- ----------
"Affiliate Transaction"................. 4.08
"Bankruptcy Law"........................ 6.01
"Blockage Notice"....................... 10.03
"Change of Control Offer"............... 4.09(b)
"covenant defeasance option"............ 8.01(b)
"Custodian"............................. 6.01
"Event of Default"...................... 6.01
"legal defeasance option"............... 8.01(b)
"Legal Holiday"......................... 13.08
"Offer"................................. 4.07(b)
"Offer Amount".......................... 4.07(c)(2)
"Offer Period".......................... 4.07(c)(2)
"pay the Securities".................... 10.03
"Paying Agent".......................... 2.03
"Payment Blockage Period"............... 10.03
"Purchase Date"......................... 4.07(c)(1)
"Registrar"............................. 2.03
"Successor Company"..................... 5.01
SECTION 1.03. Incorporation by Reference of Trust Indenture Act. This
-------------------------------------------------
Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Securities and each Guaranty;
"indenture security holder" means a Securityholder;
"indenture to be qualified" means this Indenture and each Guaranty;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the indenture securities means the Company, Parent and each
Subsidiary Guarantor and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another
37
statute or defined by SEC rule have the meanings assigned to them by such
definitions.
SECTION 1.04. 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) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) unsecured Indebtedness shall not be deemed to be subordinate or
junior to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(7) the principal amount of any Preferred Stock shall be (i) the
maximum liquidation value of such Preferred Stock or (ii) the maximum
mandatory redemption or mandatory repurchase price with respect to such
Preferred Stock, whichever is greater; and
(8) all references to the date the Securities were originally issued
shall refer to the Issue Date.
ARTICLE 2
The Securities
--------------
SECTION 2.01. Form and Dating. The Exchange Securities, the Private
---------------
Exchange Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is hereby incorporated in and
expressly made a part of this Indenture. The Securities may have notations,
legends or endorsements required by law, stock exchange rule, agreements to
which the Company is subject, if any, or usage (provided that any such notation,
legend or endorsement is in a form acceptable to the Company). Each Security
shall be dated the date of its authentication. The terms of the Securities set
forth in the Appendix and Exhibit A are part of the terms of this Indenture.
38
SECTION 2.02. Execution and Authentication. One Officer shall sign
-----------------------------
the Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security 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 may appoint an authenticating agent reasonably acceptable to
the Company to authenticate the Securities. Unless limited by the terms of such
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 any Registrar, Paying Agent or agent for service of notices and
demands.
SECTION 2.03. Registrar and Paying Agent. The Company shall maintain
--------------------------
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee 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 and shall be
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any Wholly Owned Subsidiary incorporated or organized within The
United States of America may act as Paying Agent, Registrar, co-registrar or
transfer agent.
39
The Company initially appoints the Trustee as Registrar and Paying Agent
in connection with the Securities.
SECTION 2.04. Paying Agent To Hold Money in Trust. Prior to each due
-----------------------------------
date of the principal and interest on any Security, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal and interest when
so becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Securityholders or the Trustee all money held by the Paying Agent for
the payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as
Paying Agent and hold it as a separate trust fund. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and to account
for any funds disbursed by the Paying Agent. Upon complying with this Section,
the Paying Agent shall have no further liability for the money delivered to the
Trustee.
SECTION 2.05. Securityholder 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 Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least five
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.
SECTION 2.06. Transfer and Exchange. The Securities shall be issued
---------------------
in registered form and shall be transferable only upon the surrender of a
Security for registration of transfer. When a Security is presented to the
Registrar or a co-registrar with a request to register a transfer, the Registrar
shall register the transfer as requested if the requirements of this Indenture
and Section 8-401(a) of the Uniform Commercial Code are met. When Securities are
presented to the Registrar or a co- registrar with a request to exchange them
for an equal principal amount of Securities of other denominations, the
Registrar shall make the exchange as requested if the same requirements are met.
SECTION 2.07. Replacement Securities. If a mutilated Security is
-----------------------
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost,
40
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the requirements of Section 8-405 of the
Uniform Commercial Code are met and the Holder satisfies any other reasonable
requirements of the Trustee. If required by the Trustee or the Company, such
Holder shall furnish an indemnity bond sufficient in the judgment of the Company
and the Trustee to protect the Company, the Trustee, the Paying Agent, the
Registrar and any co-registrar from any loss which any of them may suffer if a
Security is replaced. The Company and the Trustee may charge the Holder for
their expenses in replacing a Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.08. Outstanding Securities. Securities outstanding at any
----------------------
time are all Securities authenticated by the Trustee except for those canceled
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 an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest payable on that date with respect to the Securities
(or portions thereof) to be redeemed or maturing, as the case may be, and the
Paying Agent is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture, then on and after that date
such Securities (or portions thereof) cease to be outstanding and interest on
them ceases to accrue.
SECTION 2.09. 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 and
deliver them in exchange for temporary Securities.
41
SECTION 2.10. 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 registration
of transfer, exchange or payment. The Trustee and no one else shall cancel and
destroy (subject to the record retention requirements of the Exchange Act) all
Securities surrendered for registration of transfer, exchange, payment or
cancellation and deliver a certificate of such destruction to the Company unless
the Company directs the Trustee to deliver canceled Securities to the Company.
The Company may not issue new Securities to replace Securities it has redeemed,
paid or delivered to the Trustee for cancellation.
SECTION 2.11. Defaulted Interest. If the Company defaults in a
------------------
payment of interest on the Securities, the Company shall pay defaulted interest
(plus interest on such defaulted interest to the extent lawful) in any lawful
manner. The Company may pay the defaulted interest to the persons who are
Securityholders on a subsequent special record date. The Company shall fix or
cause to be fixed any such special record date and payment date to the
reasonable satisfaction of the Trustee and shall promptly mail to each
Securityholder a notice that states the special record date, the payment date
and the amount of defaulted interest to be paid.
SECTION 2.12. CUSIP Numbers. The Company in issuing the Securities
-------------
may use "CUSIP" numbers (if then generally in use) and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided, however, that any such notice may state that no representation is made
-------- -------
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
SECTION 2.13. Issuance of Additional Securities. The Company shall be
---------------------------------
entitled, subject to its compliance with Section 4.03, to issue Additional
Securities under this Indenture which shall have identical terms as the Initial
Securities issued on the Issue Date, other than with respect to the date of
issuance and issue price. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange Securities
issued in exchange therefor shall be treated as a single class for all purposes
under this Indenture.
42
With respect to any Additional Securities, the Company shall set forth in
a resolution of the Board of Directors and an Officers' Certificate, a copy of
each which shall be delivered to the Trustee, the following information:
(1) the aggregate principal amount of such Additional Securities to
be authenticated and delivered pursuant to this Indenture;
(2) the issue price, the issue date and the CUSIP number of such
Additional Securities; provided, however, that no Additional Securities may
-------- -------
be issued at a price that would cause such Additional Securities to have
"original issue discount" within the meaning of Section 1273 of the Code
(unless then applicable regulations under the Code would treat the
outstanding Securities and the Additional Securities as part of the same
issue); and
(3) whether such Additional Securities shall be Transfer Restricted
Securities and issued in the form of Initial Securities as set forth in the
Appendix to this Indenture or shall be issued in the form of Exchange
Securities as set forth in Exhibit A.
ARTICLE 3
Redemption
----------
SECTION 3.01. Notices to Trustee. If the Company elects to redeem
------------------
Securities pursuant to paragraph 5 of the Securities or is required to redeem
Securities pursuant to paragraph 6 of the Securities, it shall notify the
Trustee in writing of the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to which the redemption
will occur.
If the Company is required to redeem Securities pursuant to paragraph 6
of the Securities, it may reduce the accreted value of Securities required to be
redeemed to the extent it is permitted a credit by the terms of the Securities
and it notifies the Trustee of the amount of the credit and the basis for it. If
the reduction is based on a credit for redeemed or canceled Securities that the
Company has not previously delivered to the Trustee for cancellation, it shall
deliver such Securities with the notice.
43
The Company shall give each notice to the Trustee provided for in this
Section at least 60 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Company to the effect that such
redemption will comply with the conditions herein.
SECTION 3.02. Selection of Securities To Be Redeemed. If fewer than
--------------------------------------
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by a method that complies with applicable
legal and securities exchange requirements, if any, and that the Trustee in its
sole discretion shall deem to be fair and appropriate and in accordance with
methods generally used at the time of selection by fiduciaries in similar
circumstances. The Trustee shall make the selection from outstanding Securities
not previously called for redemption. The Trustee may select for redemption
portions of the principal of Securities that have denominations larger than
$1,000. Securities and portions of them the Trustee selects shall be in
principal amounts of $1,000 or a whole multiple of $1,000. Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be redeemed.
SECTION 3.03. Notice of Redemption. At least 30 days but not more
--------------------
than 60 days before a date for redemption of Securities (except in the case of a
redemption pursuant to paragraph 6 of the Securities, in which case, the notice
shall be mailed within the time period specified in such paragraph), the Company
shall mail a notice of redemption by first-class mail to each Holder of
Securities to be redeemed at such Holder's registered address.
The notice 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;
44
(5) if fewer than all the outstanding Securities are to be redeemed,
the identification and principal amounts of the particular Securities to
be redeemed;
(6) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment
pursuant to the terms of this Indenture, interest on Securities (or portion
thereof) called for redemption ceases to accrue on and after the redemption
date;
(7) the paragraph of the Securities pursuant to which the Securities
called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at the Company's expense. In such event, the Company
shall provide the Trustee with the information required by this Section.
SECTION 3.04. Effect of Notice of Redemption. Once notice of redemption
------------------------------
is mailed, Securities called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon surrender
to the Paying Agent, such Securities shall be paid at the redemption price
stated in the notice, plus accrued interest to the redemption date (subject to
the right of Holders of record on the relevant record date to receive interest
due on the related interest payment date). Failure to give notice or any defect
in the notice to any Holder shall not affect the validity of the notice to any
other Holder. Once notice of a redemption pursuant to paragraph 6 of the
Securities is mailed, the Company shall be entitled to redeem the Securities
pursuant to such paragraph at the redemption price provided for therein
notwithstanding the occurrence of an Event of Default after the mailing date of
such notice.
SECTION 3.05. Deposit of Redemption Price. Prior to the redemption
---------------------------
date, the Company shall deposit with the Paying Agent (or, if the Company or a
Subsidiary is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued interest on all Securities
to be redeemed on that date other than Securities or portions of Securities
called for redemption which have been delivered by the Company to the Trustee
for cancellation.
45
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a
----------------------------
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
---------
Following the first day that (a) the ratings assigned to the Securities
by both of the Rating Agencies are Investment Grade Ratings and (b) no Default
has occurred and is continuing under the Indenture (and notwithstanding that the
Company may later cease to have an Investment Grade Rating from either or both
Rating Agencies or default under this Indenture), the Company and its Restricted
Subsidiaries shall not be subject to Sections 4.03, 4.04, 4.05, 4.06, 4.07 and
4.08.
SECTION 4.01. Payment of Securities. The Company shall promptly pay
----------------------
the principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the case
may be, is not prohibited from paying such money to the Securityholders on that
date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the rate specified
therefor in the Securities, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. Notwithstanding that the Company may not
------------
be subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC and provide the Trustee and
Securityholders within 15 days after it files them with the SEC with such annual
reports and such information, documents and other reports as are specified in
Sections 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation
subject to such Sections, such information, documents and other reports to be so
filed with the SEC at the times specified for the filings of such information,
documents and reports under such Sections provided, however, that the
-------- -------
46
Company shall not be so obligated to file such reports with the SEC if the SEC
does not permit such filing, in which event the Company will make available such
information to the Trustee and Securityholders within 15 days after the time the
Company would be required to file such information with the SEC if it were
subject to Section 13 or 15(d) of the Exchange Act; provided further, however,
-------- ------- -------
that (a) so long as Parent is the Guarantor of the Securities, the reports,
information and other documents required to be filed and provided as described
hereunder may, at the Company's option, be filed by and be those of Parent
rather than the Company and (b) in the event that Parent conducts any business
or holds any significant assets other than the capital stock of the Company at
the time of filing and providing any such report, information or other document
containing financial statements of Parent, Parent shall include in such report,
information or other document summarized financial information (as defined in
Rule 1-02(bb)of Regulation S-X promulgated by the SEC) with respect to the
Company.
In addition, the Company shall furnish to the Holder of the Securities
and to prospective investors, upon the requests of such Holders, any information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so
long any Securities are not freely transferable under the Securities Act. The
Company also shall comply with the other provisions of TIA (S). 314(a).
SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not,
--------------------------
and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; provided, however, that the Company and its
-------- -------
Restricted Subsidiaries shall be entitled to Incur Indebtedness if, on the date
of such Incurrence and after giving effect thereto, no Default has occurred and
is continuing and the Consolidated Coverage Ratio exceeds 2.25 to 1 if such
Indebtedness is Incurred prior to June 1, 2003 or 2.5 to 1 if such Indebtedness
is Incurred thereafter.
(b) Notwithstanding the foregoing paragraph (a), the Company and the
Restricted Subsidiaries shall be entitled to Incur any or all of the following
Indebtedness:
(1) Indebtedness Incurred by the Company pursuant to any Revolving
Credit Facility; provided, however, that, immediately after giving effect
-------- -------
to any such Incurrence, the aggregate principal amount of all Indebtedness
Incurred under this clause (1) and then outstanding does not exceed the
greater of (A) $100.0 million less the sum of all principal
47
payments with respect to such Indebtedness pursuant to Section
4.06(a)(3)(A) and (B) 80% of the book value of the accounts receivable of
the Company and its Restricted Subsidiaries;
(2) Indebtedness Incurred by the Company pursuant to any Term Loan
Facility; provided, however, that, after giving effect to any such
-------- -------
Incurrence, the aggregate principal amount of all Indebtedness Incurred
under this clause (2) and then outstanding does not exceed $225.0 million
less the aggregate sum of all principal payments actually made from time to
time after the Issue Date with respect to such Indebtedness (other than
principal payments made from Refinancings thereof);
(3) Indebtedness owed to and held by the Company or a Restricted
Subsidiary; provided, however, that (A) any subsequent issuance or transfer
-------- -------
of any Capital Stock which results in any such Restricted Subsidiary
ceasing to be a Restricted Subsidiary or any subsequent transfer of such
Indebtedness (other than to the Company or a Restricted Subsidiary) shall
be deemed, in each case, to constitute the Incurrence of such Indebtedness
by the obligor thereon and (B) if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior
payment in full in cash of all obligations with respect to the Securities;
(4) the Securities and the Exchange Securities (other than any
Additional Securities);
(5) Indebtedness of CB Xxxxxxx Xxxxx Services and its Subsidiaries
outstanding on both the Issue Date and the Merger Date (after giving effect
to the Transactions) (other than Indebtedness described in clause (1), (2),
(3) or (4) of this Section 4.03(b));
(6) Indebtedness of a Restricted Subsidiary Incurred and outstanding
on or prior to the date on which such Subsidiary was acquired by the
Company (other than Indebtedness Incurred in connection with, or to provide
all or any portion of the funds or credit support utilized to consummate,
the transaction or series of related transactions pursuant to which such
Subsidiary became a Subsidiary or was acquired by the Company); provided,
--------
however, that on the date of such acquisition and after giving effect
-------
thereto, the aggregate principal amount of all Indebtedness Incurred
48
pursuant to this clause (6) and then outstanding does not exceed $10.0
million;
(7) Refinancing Indebtedness in respect of Indebtedness Incurred
pursuant to Section 4.03(a) or pursuant to clause (4), (5) or (6) of this
Section 4.03(b) or this clause (7); provided, however, that to the extent
-------- -------
such Refinancing Indebtedness directly or indirectly Refinances
Indebtedness of a Subsidiary Incurred pursuant to clause (6), such
Refinancing Indebtedness shall be Incurred only by such Subsidiary;
(8) Hedging Obligations entered into in the ordinary course of
business and not for the purpose of speculation;
(9) obligations in respect of letters of credit, performance, bid and
surety bonds, completion guarantees, payment obligations in connection with
self-insurance or similar requirements provided by the Company or any
Restricted Subsidiary in the ordinary course of business;
(10) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business; provided, however,
-------- -------
that such Indebtedness is extinguished within five Business Days of its
Incurrence;
(11) any Guarantee (including the Subsidiary Guaranties) by the
Company or a Restricted Subsidiary of Indebtedness or other obligations of
the Company or any of its Restricted Subsidiaries so long as the Incurrence
of such Indebtedness by the Company or such Restricted Subsidiary is
permitted under the terms of this Indenture (other than Indebtedness
Incurred pursuant to clause (6) above);
(12) Indebtedness arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations, in
each case, incurred or assumed in connection with the acquisition or
disposition of any business, assets or a Subsidiary; provided that (A) such
--------
Indebtedness is not reflected on the balance sheet of the Company or any
Restricted Subsidiary (contingent obligations referred to in a footnote or
footnotes to financial statements and not otherwise reflected on the
balance sheet will not be deemed to be reflected on such balance sheet for
49
purposes of this clause (A)) and (B) in the case of a disposition, the
maximum liability in respect of such Indebtedness shall at no time exceed
the gross proceeds including non-cash proceeds (the fair market value of
such non-cash proceeds being determined at the time received and without
giving effect to any subsequent changes in value) actually received by the
Company or such Restricted Subsidiary in connection with such disposition;
(13) Melody Permitted Indebtedness;
(14) Purchase Money Indebtedness Incurred to finance the acquisition
by the Company or any Restricted Subsidiary of any fixed or capital assets
in the ordinary course of business in an aggregate principal amount which,
when taken together with all other Indebtedness Incurred pursuant to this
clause (14) and then outstanding, does not exceed $10.0 million;
(15) Indebtedness of Foreign Restricted Subsidiaries in an aggregate
principal amount which, when taken together with all other Indebtedness of
Foreign Restricted Subsidiaries Incurred pursuant to this clause (15) and
then outstanding, does not exceed $15.0 million; and
(16) Indebtedness of the Company or any Restricted Subsidiary in an
aggregate principal amount which, when taken together with all other
Indebtedness of the Company and the Restricted Subsidiaries outstanding on
the date of such Incurrence (other than Indebtedness permitted by clauses
(1) through (15) of this Section 4.03(b) or Section 4.03(a)), does not
exceed $30.0 million.
(c) Notwithstanding the foregoing, none of the Company or any Restricted
Subsidiary shall Incur any Indebtedness pursuant to Section 4.03(b) if the
proceeds thereof are used, directly or indirectly, to Refinance any Subordinated
Obligations of the Company or any Restricted Subsidiary unless such Indebtedness
shall be subordinated to the Securities or the applicable Subsidiary Guaranty to
at least the same extent as such Subordinated Obligations.
(d) For purposes of determining compliance with this Section 4.03, (1)
in the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness described herein, the Company, in its sole discretion,
shall classify such item of Indebtedness at
50
the time of Incurrence and only be required to include the amount and type of
such Indebtedness in one of the above clauses (provided that any Indebtedness
originally classified as Incurred pursuant to clause (b)(16) above may later be
reclassified as having been Incurred pursuant to paragraph (a) above to the
extent that such reclassified Indebtedness could be Incurred pursuant to
paragraph (a) above at the time of such reclassification) and (2) the Company
shall be entitled to divide and classify an item of Indebtedness in more than
one of the types of Indebtedness described herein.
(e) Notwithstanding Section 4.03(a) or 4.03(b), none of the Company,
Parent and any Restricted Subsidiary shall Incur (1) any Indebtedness if such
Indebtedness is subordinate or junior in ranking in any respect to any Senior
Indebtedness of such Person, unless such Indebtedness is Senior Subordinated
Indebtedness of such Person or is expressly subordinated in right of payment to
Senior Subordinated Indebtedness of such Person or (2) any Secured Indebtedness
that is not Senior Indebtedness of such Person unless contemporaneously
therewith such Person makes effective provision to secure the Securities or
applicable Guaranty equally and ratably with such Secured Indebtedness for so
long as such Secured Indebtedness is secured by a Lien.
(f) For purposes of determining compliance with any U.S. dollar
restriction on the Incurrence of Indebtedness where the Indebtedness Incurred is
denominated in a different currency, the amount of such Indebtedness will be the
U.S. Dollar Equivalent determined on the date of the Incurrence of such
Indebtedness, provided, however, that if any such Indebtedness denominated in a
-------- -------
different currency is subject to a Currency Agreement with respect to U.S.
dollars covering all principal, premium, if any, and interest payable on such
Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be
as provided in such Currency Agreement. The principal amount of any Refinancing
Indebtedness Incurred in the same currency as the Indebtedness being Refinanced
will be the U.S. Dollar Equivalent of the Indebtedness Refinanced, except to the
extent that (1) such U.S. Dollar Equivalent was determined based on a Currency
Agreement, in which case the Refinancing Indebtedness will be determined in
accordance with the preceding sentence, and (2) the principal amount of the
Refinancing Indebtedness exceeds the principal amount of the Indebtedness being
Refinanced, in which case the U.S. Dollar Equivalent of such excess will be
determined on the date such Refinancing Indebtedness is Incurred.
51
SECTION 4.04. Limitation on Restricted Payments. (a) The Company
---------------------------------
shall not, and shall not permit any Restricted Subsidiary, directly or
indirectly, to make a Restricted Payment if at the time the Company or such
Restricted Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or would result
therefrom);
(2) the Company is not entitled to Incur an additional $1.00 of
Indebtedness under Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments since the Issue Date would exceed the sum of (without
duplication):
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from the Merger Date to the end of
the most recent fiscal quarter ended for which internal financial
statements are available prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a deficit, minus
100% of such deficit); plus
----
(B) 100% of the aggregate Net Cash Proceeds received by the
Company from the issuance or sale of its Capital Stock (other than
Disqualified Stock) subsequent to the Issue Date (other than an
issuance or sale to a Subsidiary of the Company and other than an
issuance or sale to an employee stock ownership plan or to a trust
established by the Company or any of its Subsidiaries for the benefit
of their employees) and 100% of any cash capital contribution received
by the Company from its shareholders subsequent to the Issue Date;
plus
----
(C) the amount by which Indebtedness of the Company is reduced
on the Company's balance sheet upon the conversion or exchange (other
than by a Subsidiary of the Company) subsequent to the Issue Date of
any Indebtedness of the Company convertible or exchangeable for
Capital Stock (other than Disqualified Stock) of the Company (less the
amount of any cash, or the fair value of any other property,
distributed by the Company upon such conversion or exchange); plus
----
52
(D) an amount equal to the sum of (x) the net reduction in the
Investments (other than Permitted Investments) made by the Company or
any Restricted Subsidiary in any Person resulting from repurchases,
repayments or redemptions of such Investments by such Person, proceeds
realized on the sale of such Investment and proceeds representing the
return of capital (excluding dividends and distributions), in each
case received by the Company or any Restricted Subsidiary and (y) to
the extent such Person is an Unrestricted Subsidiary, the portion
(proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Unrestricted
Subsidiary at the time such Unrestricted Subsidiary is designated a
Restricted Subsidiary; provided, however, that the foregoing sum shall
-------- -------
not exceed, in the case of any such Person or Unrestricted Subsidiary,
the amount of Investments (excluding Permitted Investments) previously
made (and treated as a Restricted Payment) by the Company or any
Restricted Subsidiary in such Person or Unrestricted Subsidiary.
(b) The provisions of Section 4.04(a) shall not prohibit:
(1) any Restricted Payment made out of the Net Cash Proceeds of the
substantially concurrent sale of, or made by exchange for, Capital Stock of
the Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary of the Company or an employee stock
ownership plan or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees) or a substantially
concurrent cash capital contribution received by the Company from its
shareholders; provided, however, that (A) such Restricted Payment shall be
-------- -------
excluded in the calculation of the amount of Restricted Payments and (B)
the Net Cash Proceeds from such sale or such cash capital contribution (to
the extent so used for such Restricted Payment) shall be excluded from the
calculation of amounts under Section 4.04(a)(3)(B);
(2) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations of the
Company or a Restricted Subsidiary made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Indebtedness which is
permitted to be Incurred pursuant
53
to Section 4.03; provided, however, that such purchase, repurchase,
-------- -------
redemption, defeasance or other acquisition or retirement for value shall
be excluded in the calculation of the amount of Restricted Payments;
(3) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with this Section 4.04; provided, however, that such dividend shall be
-------- -------
included in the calculation of the amount of Restricted Payments;
(4) repurchases of Capital Stock of Parent required under the
Company's 401(k) plan as it existed as of the Merger Date; provided,
--------
however, that such repurchases shall be excluded from the calculation of
-------
the amount of Restricted Payments;
(5) so long as no Default has occurred and is continuing, the
repurchase or other acquisition of shares of Capital Stock of Parent or the
Company or any of the Company's Subsidiaries from employees (including
substantially full-time independent contractors), former employees,
directors, former directors or consultants of the Company or any of its
Subsidiaries (or permitted transferees of such employees, former employees,
directors, former directors or consultants), pursuant to the terms of the
agreements (including employment agreements)or plans (or amendments
thereto)approved by the Board of Directors under which such individuals
purchase or sell or are granted the option to purchase or sell, shares of
such Capital Stock; provided, however, that the aggregate amount of such
-------- -------
repurchases and other acquisitions shall not exceed the sum of (A) $5.0
million, (B) the Net Cash Proceeds from the sale of Capital Stock to
members of management, consultants or directors of the Company and its
Subsidiaries that occurs after the Merger Date (to the extent the Net Cash
Proceeds from the sale of such Capital Stock have not otherwise been
applied to the payment of Restricted Payments by virtue of clause (3)(B) of
paragraph (a) above) and (C) the cash proceeds of any "key man" life
insurance policies that are used to make such repurchases; provided
--------
further, however, that (x) such repurchases and other acquisitions shall be
------- -------
excluded in the calculation of the amount of Restricted Payments and (y)
the Net Cash Proceeds from such sale shall be excluded from the calculation
of amounts under clause (3)(B) of paragraph (a) above;
54
(6) Investments made by Melody in connection with the Melody Loan
Arbitrage Facility or the Melody Mortgage Warehousing Facility; provided,
--------
however, that such Investments shall be excluded in the calculation of the
-------
amount of Restricted Payments;
(7) payments required pursuant to the terms of the Merger Agreement
to consummate the Merger; provided, however, that such payments shall be
-------- -------
excluded in the calculation of the amount of Restricted Payments;
(8) dividends to Parent to be used by Parent solely to pay its
franchise taxes and other fees required to maintain its corporate existence
and to pay for general corporate and overhead expenses (including salaries
and other compensation of the employees)incurred by Parent in the ordinary
course of its business; provided, however, that such dividends shall not
-------- -------
exceed $1.0 million in any calendar year; provided further, however, that
-------- ------- -------
such dividends shall be excluded in the calculation of the amount of
Restricted Payments;
(9) payments to Parent in respect of Federal, state and local taxes
directly attributable to (or arising as a result of) the operations of the
Company and its consolidated Subsidiaries; provided, however, that the
-------- -------
amount of such payments in any fiscal year do not exceed the amount that
the Company and its consolidated Subsidiaries would be required to pay in
respect of Federal, state and local taxes for such fiscal year were the
Company to pay such taxes as a stand-alone taxpayer (whether or not all
such amounts are actually used by Parent for such purposes); provided
--------
further, however, that such payments shall be excluded in the calculation
------- -------
of the amount of Restricted Payments; and
(10) Restricted Payments in an aggregate amount which, when taken
together with all Restricted Payments made pursuant to this clause (10)
which have not been repaid, does not exceed $20.0 million; provided,
--------
however, that (A) at the time of such Restricted Payments, no Default shall
-------
have occurred and be continuing (or result therefrom) and (B) such
Restricted Payments shall be excluded in the calculation of the amount of
Restricted Payments.
SECTION 4.05. Limitation on Restrictions on Distributions from
------------------------------------------------
Restricted Subsidiaries. The Company shall not, and shall not permit any
-----------------------
Restricted Subsidiary
55
to, create or otherwise cause or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (a) pay dividends or make any other distributions on its Capital
Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to
the Company, (b) make any loans or advances to the Company or (c) transfer any
of its property or assets to the Company, except:
(1) with respect to clauses (a), (b) and (c),
(A) any encumbrance or restriction pursuant to an agreement of CB
Xxxxxxx Xxxxx Services or any of its Subsidiaries in effect at or entered
into on the Issue Date or, in the case of the Credit Agreement, as in
effect on the Merger Date;
(B) any encumbrance or restriction contained in the terms of any
Indebtedness Incurred pursuant to Section 4.03(b)(15) or any agreement
pursuant to which such Indebtedness was issued if (x) either (i) the
encumbrance or restriction applies only in the event of and during the
continuance of a payment default or a default with respect to a financial
covenant contained in such Indebtedness or agreement or (ii) the Company
determines at the time any such Indebtedness is Incurred (and at the time
of any modification of the terms of any such encumbrance or restriction)
that any such encumbrance or restriction will not materially affect the
Company's ability to make principal or interest payments on the Securities
and (y) the encumbrance or restriction is not materially more
disadvantageous to the Holders than is customary in comparable financings
or agreements (as determined by the Board of Directors in good faith);
(C) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary on or prior to the date on which such
Restricted Subsidiary was acquired by the Company (other than Indebtedness
Incurred as consideration in, or to provide all or any portion of the funds
or credit support utilized to consummate, the transaction or series of
related transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by the Company) and outstanding on
such date;
(D) any encumbrance or restriction pursuant to an agreement effecting
a Refinancing of Indebtedness
56
Incurred pursuant to an agreement referred to in Section 4.05(1) (A), (B)
or (C) or this clause (D) or contained in any amendment to an agreement
referred to in Section 4.05(1)(A), (B) or (C) or this clause (D); provided,
--------
however, that the encumbrances and restrictions with respect to such
-------
Restricted Subsidiary contained in any such refinancing agreement or
amendment are no less favorable to the Securityholders than encumbrances
and restrictions with respect to such Restricted Subsidiary contained in
such predecessor agreements; and
(E) any encumbrance or restriction pursuant to applicable law; and
(2) with respect to clause (c) only,
(A) any such encumbrance or restriction consisting of customary non-
assignment provisions in leases governing leasehold interests to the extent
such provisions restrict the transfer of the lease or the property leased
thereunder;
(B) restrictions contained in security agreements or mortgages
securing Indebtedness of a Restricted Subsidiary to the extent such
restrictions restrict the transfer of the property subject to such security
agreements or mortgages;
(C) restrictions on the transfer of assets subject to any Lien
permitted under this Indenture imposed by the holder of such Lien; and
(D) any restriction with respect to a Restricted Subsidiary imposed
pursuant to an agreement entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of such Restricted Subsidiary
pending the closing of such sale or disposition.
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock. (a)
--------------------------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, consummate any Asset Disposition unless (1) the Company
or such Restricted Subsidiary receives consideration at the time of such Asset
Disposition at least equal to the fair market value (including as to the value
of all non-cash consideration), as determined in good faith by the Board of
Directors, of the shares and assets subject to such Asset Disposition; (2) at
least 80% of the consideration thereof received by the Company or such
Restricted Subsidiary is in
57
the form of cash or cash equivalents; and (3) an amount equal to 100% of the Net
Available Cash from such Asset Disposition is applied by the Company (or such
Restricted Subsidiary, as the case may be) (A) first, to the extent the Company
-----
elects (or is required by the terms of any Indebtedness), to prepay, repay,
redeem or purchase Senior Indebtedness of the Company or a Subsidiary Guarantor
or Indebtedness (other than any Disqualified Stock) of any other Wholly Owned
Subsidiary (in each case other than Indebtedness owed to the Company or an
Affiliate of the Company) within one year from the later of the date of such
Asset Disposition or the receipt of such Net Available Cash; (B) second, to the
------
extent of the balance of such Net Available Cash after application in accordance
with clause (A), to the extent the Company elects, to acquire Additional Assets
within one year from the later of the date of such Asset Disposition or the
receipt of such Net Available Cash; and (C) third, to the extent of the balance
-----
of such Net Available Cash after application in accordance with clauses (A) and
(B), to make an Offer to the holders of the Securities (and to holders of other
Senior Subordinated Indebtedness of the Company designated by the Company) to
purchase Securities (and such other Senior Subordinated Indebtedness of the
Company) pursuant to and subject to the conditions of Section 4.06(b); provided,
--------
however, that in connection with any prepayment, repayment or purchase of
-------
Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted
Subsidiary shall permanently retire such Indebtedness and shall cause the
related loan commitment (if any) to be permanently reduced in an amount equal to
the principal amount so prepaid, repaid or purchased. Notwithstanding the
foregoing provisions of this Section 4.06, the Company and the Restricted
Subsidiaries shall not be required to apply any Net Available Cash in accordance
with this Section 4.06(a) except to the extent that the aggregate Net Available
Cash from all Asset Dispositions which is not applied in accordance with this
Section 4.06(a) exceeds $10.0 million. Pending application of Net Available Cash
pursuant to this Section 4.06(a), such Net Available Cash shall be invested in
Temporary Cash Investments or applied to temporarily reduce revolving credit
indebtedness.
For the purposes of this Section 4.06(a), the following are deemed to be
cash or cash equivalents: (1) the assumption of Indebtedness of the Company or
any Restricted Subsidiary and the release of the Company or such Restricted
Subsidiary from all liability on such Indebtedness in connection with such Asset
Disposition and (2) securities received by the Company or any Restricted
58
Subsidiary from the transferee that are promptly converted by the Company or
such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the purchase of
Securities (and other Senior Subordinated Indebtedness of the Company) pursuant
to Section 4.06(a)(3)(C), the Company shall purchase Securities tendered
pursuant to an offer by the Company for the Securities (and such other Senior
Subordinated Indebtedness of the Company) (the "Offer") at a purchase price of
100% of their principal amount (or, in the event such other Senior Subordinated
Indebtedness of the Company was issued with significant original issue discount,
100% of the accreted value thereof), without premium, plus accrued but unpaid
interest (or, in respect of such other Senior Subordinated Indebtedness, such
lesser price, if any, as may be provided for by the terms of such Senior
Subordinated Indebtedness of the Company) in accordance with the procedures
(including prorating in the event of over-subscription) set forth in Section
4.06(c). If the aggregate purchase price of Securities (and any other Senior
Subordinated Indebtedness of the Company) tendered pursuant to the Offer exceeds
the Net Available Cash allotted to their purchase, the Company shall select the
Securities and other Senior Subordinated Indebtedness to be purchased on a pro
rata basis but in round denominations, which in the case of the Securities will
be denominations of $1,000 principal amount or multiples thereof. The Company
shall not be required to make an Offer to purchase Securities (and other Senior
Subordinated Indebtedness of the Company) pursuant to this Section 4.06 if the
Net Available Cash available therefor is less than $10.0 million (which lesser
amount shall be carried forward for purposes of determining whether such an
Offer is required with respect to the Net Available Cash from any subsequent
Asset Disposition).
(c) (1) Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer, the Company shall deliver to the Trustee and
send, by first-class mail to each Holder, a written notice stating that the
Holder may elect to have his Securities purchased by the Company either in whole
or in part (subject to prorating as described in Section 4.06(b) in the event
the Offer is oversubscribed) in integral multiples of $1,000 of principal
amount, at the applicable purchase price. The notice shall specify a purchase
date not less than 30 days nor more than 60 days after the date of such notice
(the "Purchase Date") and shall contain such information concerning the business
of the Company which the Company in good faith believes will enable such Holders
to make an informed decision (which at a minimum will include (A) the most
recently filed Annual
59
Report on Form 10-K (including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form 10-Q and
any Current Report on Form 8-K of the Company filed subsequent to such Quarterly
Report, other than Current Reports describing Asset Dispositions otherwise
described in the offering materials (or corresponding successor reports), (B) a
description of material developments in the Company's business subsequent to the
date of the latest of such Reports, and (C) if material, appropriate pro forma
financial information) and all instructions and materials necessary to tender
Securities pursuant to the Offer, together with the information contained in
clause (3).
(2) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided below, the Company shall deliver to the
Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer
Amount"), including information as to any other Senior Subordinated Indebtedness
included in the Offer, (B) the allocation of the Net Available Cash from the
Asset Dispositions pursuant to which such Offer is being made and (C) the
compliance of such allocation with the provisions of Section 4.06(a) and (b). On
such date, the Company shall also irrevocably deposit with the Trustee or with a
Paying Agent (or, if the Company is acting as its own Paying Agent, segregate
and hold in trust) in Temporary Cash Investments, maturing on the last day prior
to the Purchase Date or on the Purchase Date if funds are immediately available
by open of business, an amount equal to the Offer Amount to be held for payment
in accordance with the provisions of this Section. If the Offer includes other
Senior Subordinated Indebtedness, the deposit described in the preceding
sentence may be made with any other paying agent pursuant to arrangements
satisfactory to the Trustee. Upon the expiration of the period for which the
Offer remains open (the "Offer Period"), the Company shall deliver to the
Trustee for cancellation the Securities or portions thereof which have been
properly tendered to and are to be accepted by the Company. The Trustee shall,
on the Purchase Date, mail or deliver payment (or cause the delivery of payment)
to each tendering Holder in the amount of the purchase price. In the event that
the aggregate purchase price of the Securities delivered by the Company to the
Trustee is less than the Offer Amount applicable to the Securities, the Trustee
shall deliver the excess to the Company immediately after the expiration of the
Offer Period for application in accordance with this Section 4.06.
(3) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appro-
60
priate form duly completed, to the Company at the address specified in the
notice at least three Business Days prior to the Purchase Date. Holders shall be
entitled to withdraw their election if the Trustee or the Company receives not
later than one Business Day prior to the Purchase Date, a telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Security which was delivered for purchase by the Holder and a
statement that such Holder is withdrawing his election to have such Security
purchased. Holders whose Securities are purchased only in part shall be issued
new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee which are
to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section. A Security shall
be deemed to have been accepted for purchase at the time the Trustee, directly
or through an agent, mails or delivers payment therefor to the surrendering
Holder.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the purchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with provisions of this Section, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue of its compliance with
such securities laws or regulations.
SECTION 4.07. Limitation on Affiliate Transactions. (a) The Company
------------------------------------
shall not, and shall not permit any Restricted Subsidiary to, enter into or
permit to exist any transaction (including the purchase, sale, lease or exchange
of any property, employee compensation arrangements or the rendering of any
service) with, or for the benefit of, any Affiliate of the Company (an
"Affiliate Transaction") unless (1) the terms thereof are no less favorable to
the Company or such Restricted Subsidiary than those that could be obtained at
the time of such Affiliate Transaction in arm's-length dealings with a Person
who is not such an Affiliate; (2) if such Affiliate Transaction involves an
amount in excess of $2.5 million, the terms of the Affiliate Transaction are set
forth in writing and a majority of the directors of the Company disinterested
with respect to such Affiliate Transaction have determined in
61
good faith that the criteria set forth in clause (1) are satisfied and have
approved the relevant Affiliate Transaction as evidenced by a resolution of the
Board of Directors; and (3) if such Affiliate Transaction involves an amount in
excess of $10.0 million, the Board of Directors shall also have received a
written opinion from an Independent Qualified Party to the effect that such
Affiliate Transaction is fair, from a financial standpoint, to the Company and
its Restricted Subsidiaries or is not less favorable to the Company and its
Restricted Subsidiaries than could reasonably be expected to be obtained at the
time in an arm's-length transaction with a Person who was not an Affiliate.
(b) The provisions of Section 4.07(a) shall not prohibit (1) any
Investment (other than a Permitted Investment) or other Restricted Payment, in
each case permitted to be made pursuant to Section 4.04; (2) any issuance of
securities, or other payments, awards or grants in cash, securities or otherwise
pursuant to, or the funding of, employment arrangements, stock options and stock
ownership plans approved by the Board of Directors; (3) loans or advances to
employees or consultants in the ordinary course of business of the Company or
its Restricted Subsidiaries, but in any event not to exceed $3.0 million in the
aggregate outstanding at any one time; (4) the payment of reasonable fees and
compensation to, or the provision of employee benefit arrangements and indemnity
for the benefit of, directors, officers, employees and consultants of the
Company and its Restricted Subsidiaries in the ordinary course of business; (5)
any transaction between or among the Company, any Restricted Subsidiary or joint
venture or similar entity which would constitute an Affiliate Transaction solely
because the Company or a Restricted Subsidiary owns an equity interest in or
otherwise controls such Restricted Subsidiary, joint venture or similar entity;
(6) the issuance or sale of any Capital Stock (other than Disqualified Stock) of
the Company; (7) the existence of, or the performance by the Company or any of
its Restricted Subsidiaries of its obligations under the terms of any
stockholders agreement (including any registration rights agreement or purchase
agreement related thereto) or warrant agreement to which it is a party as of the
Merger Date and any similar agreements which it may enter into thereafter;
provided, however, that the existence of, or the performance by the Company or
-------- -------
any of its Restricted Subsidiaries of obligations under any future amendment to
any such existing agreement or under any similar agreement entered into after
the Merger Date shall only be permitted by this clause (7) to the extent that
the terms of any such amendment or new agreement are not otherwise
disadvantageous to the Holders
62
in any material respect; (8) the payment of fees and other expenses to be paid
by Parent, the Company or any of its Subsidiaries in connection with the Merger;
(9) any agreement as in effect on the Merger Date and described in the Offering
Circular or any renewals, extensions or amendments of any such agreement (so
long as such renewals, extensions or amendments are not less favorable to the
Company or the Restricted Subsidiaries)and the transactions evidenced thereby;
and (10) transactions with customers, clients, suppliers or purchasers or
sellers of goods or services in each case in the ordinary course of business and
otherwise in compliance with the terms of the applicable Indenture which are
fair to the Company or its Restricted Subsidiaries, in the reasonable
determination of the Board of Directors of the Company or the senior management
thereof, or are on terms at least as favorable as might reasonably have been
obtained at such time from an unaffiliated party.
SECTION 4.08. Limitation on the Sale or Issuance of Capital Stock of
------------------------------------------------------
Restricted Subsidiaries. The Company (1) shall not, and shall not permit any
-----------------------
Restricted Subsidiary to, sell, lease, transfer or otherwise dispose of any
Capital Stock of any Restricted Subsidiary to any Person (other than to the
Company or a Wholly Owned Subsidiary), and (2) shall not permit any Restricted
Subsidiary to issue any of its Capital Stock (other than, if necessary, shares
of its Capital Stock constituting directors' or other legally required
qualifying shares) to any Person (other than the Company or a Wholly Owned
Subsidiary) unless (A) immediately after giving effect to such issuance, sale or
other disposition, neither the Company nor any of its Subsidiaries owns any
Capital Stock of such Restricted Subsidiary or (B) immediately after giving
effect to such issuance, sale or other disposition, such Restricted Subsidiary
would no longer constitute a Restricted Subsidiary and any Investment in such
Person (other than in the case of an Exempt Subsidiary) remaining after giving
effect thereto is treated as a new Investment by the Company and such Investment
would have been permitted to be made under Section 4.04 if made on the date of
such issuance, sale or other disposition.
SECTION 4.09. Change of Control. (a) Upon the occurrence of a Change
-----------------
of Control, each Holder shall have the right to require that the Company
purchase such Holder's Securities at a purchase price in cash equal to 101% of
the principal amount thereof on the date of purchase plus accrued and unpaid
interest, if any, to the date of purchase (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
interest
63
payment date), in accordance with the terms contemplated in Section 4.09(b). In
the event that at the time of such Change of Control the terms of the Credit
Agreement prohibit the Company from making a Change of Control Offer or from
purchasing Securities pursuant thereto, then prior to the mailing of the notice
to Holders provided for in Section 4.09(b) below but in any event within 30 days
following any Change of Control, the Company shall (1) repay in full all
indebtedness outstanding under the Credit Agreement offer to repay in full all
such indebtedness and repay the indebtedness of each lender who has accepted
such offer or (ii) obtain the requisite consent under the Credit Agreement to
permit the repurchase of the Securities as provided for in Section 4.09(b).
(b) Within 30 days following any Change of Control, unless the Company
has exercised its option to redeem all the Securities pursuant to paragraph 6 of
the Securities the Company shall mail a notice to each Holder with a copy to the
Trustee (the "Change of Control Offer") stating:
(1) that a Change of Control has occurred and that such Holder has
the right to require the Company to purchase such Holder's Securities at a
purchase price in cash equal to 101% of the principal amount thereof on the
date of purchase plus accrued and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of record on the relevant record
date to receive interest on the relevant interest payment date);
(2) the circumstances and relevant facts regarding such Change of
Control (including information with respect to pro forma historical income,
cash flow and capitalization, in each case after giving effect to such
Change of Control);
(3) the purchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(4) the instructions, as determined by the Company, consistent with
this Section, that a Holder must follow in order to have its Securities
purchased.
(c) Holders electing to have a Security purchased will be required to
surrender the Security, with an appropriate form duly completed, to the Company
at the address specified in the notice at least three Business Days prior to the
purchase date. Holders will be entitled to withdraw
64
their election if the Trustee or the Company receives not later than one
Business Day prior to the purchase date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Security which was delivered for purchase by the Holder and a
statement that such Holder is withdrawing his election to have such Security
purchased.
(d) On the purchase date, all Securities purchased by the Company under
this Section shall be delivered by the Company to the Trustee for cancellation,
and the Company shall pay the purchase price plus accrued and unpaid interest,
if any, to the Holders entitled thereto.
(e) Notwithstanding the foregoing provisions of this Section, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section applicable to a Change of Control Offer made by the Company and
purchases all Securities validly tendered and not withdrawn under such Change of
Control Offer or if the Company has exercised its option to redeem all the
Securities pursuant to paragraph 6 of the Securities.
(f) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the purchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with provisions of this Section, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue of its compliance with
such securities laws or regulations.
SECTION 4.10. Future Guarantors. On the Merger Date, the Company
-----------------
shall cause each of its Restricted Subsidiaries that is a guarantor under the
Credit Agreement to execute and deliver to the Trustee a Guaranty Agreement
pursuant to which such Restricted Subsidiary shall Guarantee the Company's
obligations with respect to the Securities on the terms set forth therein. After
the Merger Date, the Company shall cause each Restricted Subsidiary that
Guarantees any Indebtedness of the Company to, at the same time, execute and
deliver to the Trustee a Guaranty Agreement pursuant to which such Restricted
Subsidiary shall Guarantee the Company's obligations with respect to the
Securities on the terms set forth herein.
65
SECTION 4.11. Compliance Certificate. The Company shall deliver to the
----------------------
Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA ss. 314(a)(4).
SECTION 4.12. Payment of Additional Interest. If additional interest
------------------------------
is payable by the Company pursuant to the Registration Rights Agreement and
paragraph 1 of the Securities, the Company shall deliver to the Trustee a
certificate to that effect stating (i) the amount of such additional interest
that is payable and (ii) the date on which such interest is payable. Unless and
until the Trustee receives such a certificate, the Trustee may assume without
inquiry that no Registration Default (as defined in the Registration Rights
Agreement) exists and that no additional interest is owed by the Company. If the
Company has paid additional interest directly to the persons entitled to such
interest, the Company shall deliver to the Trustee a certificate setting forth
the particulars of such payment.
SECTION 4.13. Further Instruments and Acts. Upon request of the
----------------------------
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE 5
Merger and Consolidation
------------------------
Following the first day that (a) the ratings assigned to the Notes by
both of the Rating Agencies are Investment Grade Ratings and (b) no Default has
occurred and is continuing under this Indenture (and notwithstanding that the
Company may later cease to have an Investment Grade Rating from either or both
Rating Agencies or default under the Indenture), the Company shall not be
subject to clause (3) of Section 5.01(a).
SECTION 5.01. When Company, Subsidiary Guarantors and Parent May Merge or
-----------------------------------------------------------
Transfer Assets. (a) The Company shall not consolidate with or merge with or
---------------
into, or convey,
66
transfer or lease, in one transaction or a series of transactions, directly or
indirectly, all or substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the "Successor
Company") shall be a Person organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia and
the Successor Company (if not the Company) shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, all the obligations of the
Company under the Securities and this Indenture;
(2) immediately after giving pro forma effect to such transaction
(and treating any Indebtedness which becomes an obligation of the Successor
Company or any Subsidiary as a result of such transaction as having been
Incurred by the Successor Company or such Subsidiary at the time of such
transaction), no Default shall have occurred and be continuing;
(3) immediately after giving pro forma effect to such transaction,
the Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a); and
(4) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with this Indenture;
provided, however, that clause (3) shall not be applicable to (A) a Restricted
-------- -------
Subsidiary consolidating with, merging into or transferring all or part of its
properties and assets to the Company or (B) the Company merging with an
Affiliate of the Company solely for the purpose and with the sole effect of
reincorporating the Company in another jurisdiction. In addition,
notwithstanding clause (3) above, XXXX XX Corp. may merge into CB Xxxxxxx Xxxxx
Services, Inc. on the Merger Date as contemplated by the Merger Agreement.
The Successor Company shall be the successor to the Company and shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture, and the predecessor Company, except in the
case of a lease, shall be released from the obligation to pay the principal of
and interest on the Securities.
67
(b) The Company shall not permit any Subsidiary Guarantor to consolidate
with or merge with or into, or convey, transfer or lease, in one transaction or
series of transactions, all or substantially all of its assets to any Person
unless:
(1) except in the case of a Subsidiary Guarantor that has been
disposed of in its entirety to another Person (other than to the Company or
an Affiliate of the Company), whether through a merger, consolidation or
sale of Capital Stock or assets, if in connection therewith the Company
provides an Officers' Certificate to the Trustee to the effect that the
Company will comply with its obligations under Section 4.06 in respect of
such disposition, the resulting, surviving or transferee Person (if not
such Subsidiary) shall be a Person organized and existing under the laws of
the jurisdiction under which such Subsidiary was organized or under the
laws of the United States of America, or any State thereof or the District
of Columbia, and such Person shall expressly assume, by a Guaranty
Agreement, all the obligations of such Subsidiary, if any, under its
Subsidiary Guaranty;
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person as a
result of such transaction as having been issued by such Person at the time
of such transaction), no Default shall have occurred and be continuing; and
(3) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger or
transfer and such Guaranty Agreement, if any, complies with this Indenture.
(c) Parent shall not consolidate with or merge with or into, or convey,
transfer or lease, in one transaction or a series of transactions, all or
substantially all of its assets to any Person unless:
(1) the resulting, surviving or transferee Person (if not Parent)
shall be a Person organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia, and such
Person shall expressly assume, by a Guaranty Agreement, all the obligations
of Parent, if any, under its Guaranty;
68
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person as a
result of such transaction as having been issued by such Person at the time
of such transaction), no Default shall have occurred and be continuing; and
(3) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger or
transfer and such Guaranty Agreement, if any, complies with this Indenture.
ARTICLE 6
Defaults and Remedies
---------------------
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
-----------------
(1) the Company defaults in any payment of interest on any Security
when the same becomes due and payable, whether or not such payment shall be
prohibited by Article 10, and such default continues for a period of 30
days;
(2) the Company (i) defaults in the payment of the principal of any
Security when the same becomes due and payable at its Stated Maturity, upon
redemption, upon declaration of acceleration or otherwise, whether or not
such payment shall be prohibited by Article 10 or (ii) fails to redeem or
purchase Securities when required pursuant to this Indenture or the
Securities, whether or not such redemption or purchase shall be prohibited
by Article 10;
(3) the Company, Parent or any Subsidiary Guarantor fails to comply
with Section 5.01;
(4) the Company, Parent or any Subsidiary Guarantor, as the case may
be, fails to comply with Section 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08,
4.09 or 4.10 (other than a failure to purchase Securities when required
under Section 4.06 or 4.09) and such failure continues for 30 days after
the notice specified below;
(5) the Company, Parent or any Subsidiary Guarantor fails to comply
with any of its agreements in
69
the Securities or this Indenture (other than those referred to in clause
(1), (2), (3) or (4) above) and such failure continues for 60 days after
the notice specified below;
(6) Indebtedness of the Company or any Significant Subsidiary is not
paid within any applicable grace period after final maturity or is
accelerated by the holders thereof because of a default and the total
amount of such Indebtedness unpaid or accelerated exceeds $10.0 million, or
its foreign currency equivalent at the time;
(7) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case;
(C) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(D) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days;
(9) any judgment or decree for the payment of money (other than
judgments which are covered by
70
enforceable insurance policies issued by solvent carriers) in excess of
$10.0 million (or its foreign currency equivalent at the time) is entered
against the Company or any Significant Subsidiary, remains outstanding for
a period of 60 days following the entry of such judgment or decree and is
not discharged, waived or the execution thereof stayed within 10 days after
the notice specified below; or
(10) the Parent Guaranty or a Subsidiary Guaranty ceases to be in full
force and effect (other than in accordance with the terms of such Guaranty)
or a Guarantor denies or disaffirms its obligations under its Guaranty.
The foregoing will constitute Events of Default whatever the reason for
any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, or any
------------------
similar Federal, state or foreign law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clauses (4), (5) or (9) is not an Event of Default until
the Trustee or the holders of at least 25% in principal amount of the
outstanding Securities notify the Company of the Default and the Company does
not cure such Default within the time specified after receipt of such notice.
Such notice must specify the Default, demand that it be remedied and state that
such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (6) or (10) and any event which with the
giving of notice or the lapse of time would become an Event of Default under
clause (4), (5) or (9), its status and what action the Company is taking or
proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an
------------
Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Trustee by notice to the Company, or the
Holders of at least 25% in principal amount of the
71
Securities by notice to the Company and the Trustee, may declare the principal
of and accrued but unpaid interest on all the Securities to be due and payable;
provided, however, that so long as any Bank Indebtedness remains outstanding, no
-------- -------
such acceleration shall be effective until the earlier of (1) five Business Days
after the giving of written notice to the Company and the administrative agent
(or similar agent if there is no administrative agent) under the Credit
Agreement and (2) the day on which any Bank Indebtedness is accelerated. Upon
such a declaration, such principal and interest shall be due and payable
immediately. If an Event of Default specified in Section 6.01(7) or (8) with
respect to the Company occurs and is continuing, the principal of and interest
on all the Securities shall ipso facto become and be immediately due and payable
---- -----
without any declaration or other act on the part of the Trustee or any Security-
holders. The Holders of a majority in principal amount of the Securities by
notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived except nonpayment of principal or
interest that has become due solely because of acceleration. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy to collect the payment
of principal 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 Securityholder 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.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
-----------------------
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (i) a Default in the payment of the
principal of or interest on a Security (ii) a Default arising from the failure
to redeem or purchase any Security when required pursuant to this Indenture or
(iii) a Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Securityholder affected. When a Default is
waived, it is deemed cured, but no such
72
waiver shall extend to any subsequent or other Default or impair any consequent
right.
SECTION 6.05. Control by Majority. The Holders of a majority in
-------------------
principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Securityholders or would involve the Trustee in personal
liability; provided, however, that the Trustee may take any other action deemed
-------- -------
proper by the Trustee that is not inconsistent with such direction. Prior to
taking any action hereunder, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
SECTION 6.06. Limitation on Suits. Except to enforce the right to
-------------------
receive payment of principal, premium (if any) or interest when due, no
Securityholder may pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in principal amount of the Securities
make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable security
or indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority in principal amount of the Securities
do not give the Trustee a direction inconsistent with the request during
such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
73
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding
------------------------------------
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on the Securities held by such Holder, on
or after the respective due dates expressed in the Securities, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default
--------------------------
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount then due and owing (together with interest on any
unpaid interest to the extent lawful) and the amounts provided for in Section
7.07.
SECTION 6.09. 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 and the Securityholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in bankruptcy or other
Person performing similar functions, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder to make 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 it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and its counsel, and any other amounts due the Trustee under Section
7.07.
SECTION 6.10. Priorities. If the Trustee collects any money or
----------
property pursuant to this Article 6, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to holders of Senior Indebtedness of the Company and, if such
money or property has been collected from a Guarantor, to holders of Senior
Indebtedness of such Guarantor, in each case to the extent required by
Article 10 and 12;
THIRD: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or
priority of any kind,
74
according to the amounts due and payable on the Securities for principal
and interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section. At least 15 days before such record
date, the Company shall mail to each Securityholder and the Trustee a notice
that states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. The Company (to the
--------------------------------
extent it may lawfully do so under applicable law) shall not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and shall not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
shall suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE 7
Trustee
-------
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has
-----------------
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
75
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(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 may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own wilful misconduct, except
that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section;
(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; and
(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 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur financial liability in the performance
of any of its
76
duties hereunder or in the exercise of any of its rights or powers, if it shall
have reasonable grounds to believe that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. (a) The Trustee may rely on any
-----------------
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute wilful
-------- -------
misconduct or negligence.
(e) The Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.
SECTION 7.03. 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 or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
--------------------
responsible for and makes no representation as
77
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 of the Company in the Indenture or in
any document issued in connection with the sale of the Securities or in the
Securities other than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a Default occurs and is
------------------
continuing and if it is known to the Trustee, the Trustee shall mail to each
Securityholder notice of the Default within 90 days after it occurs. Except in
the case of a Default in payment of principal of or interest on any Security
(including payments pursuant to the mandatory redemption provisions of such
Security, if any), the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as
-----------------------------
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of May 15 that
complies with TIA (s) 313(a). The Trustee also shall comply with TIA (s) 313(b).
A copy of each report at the time of its mailing to Securityholders shall
be filed with the SEC and each stock exchange (if any) on which the Securities
are listed. The Company agrees to notify promptly the Trustee whenever the
Securities become listed on any stock exchange and of any delisting thereof.
SECTION 7.07. 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 out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company shall indemnify the Trustee against any and all loss,
liability or expense (including attorneys' fees) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder. The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so
78
notify the Company shall not relieve the Company of its obligations hereunder.
The Company shall defend the claim and the Trustee may have separate counsel and
the Company shall pay the fees and expenses of such counsel. The Company need
not reimburse any expense or indemnify against any loss, liability or expense
incurred by the Trustee through the Trustee's own wilful misconduct, negligence
or bad faith.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities.
The Company's payment obligations pursuant to this Section shall survive
the discharge of this Indenture. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(7) or (8) with respect to the
Company, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign at any
----------------------
time by so notifying the Company. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the Trustee and may
appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders of a
majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor
79
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Securityholders. The retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the lien provided for in
Section 7.07.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section,
the Company's obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee
---------------------------
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets (including the administration of the
trust created by this Indenture) to, another corporation or banking association,
the resulting, surviving or transferee corporation without any further act shall
be the successor Trustee.
In case at the time such successor or successors by merger, conversion or
consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at all
------------------------------
times satisfy the requirements of TIA (S)310(a). The Trustee (or, in the case of
a subsidiary of a bank holding company, its corporate parent) shall have a
80
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
(S) 310(b); provided, however, that there shall be excluded from the operation
-------- -------
of TIA (S) 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 (S)
310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee shall comply with TIA (S) 311(a), excluding any creditor relationship
listed in TIA (S) 311(b). A Trustee who has resigned or been removed shall be
subject to TIA (S) 311(a) to the extent indicated.
ARTICLE 8
Discharge of Indenture; Defeasance
----------------------------------
SECTION 8.01. Discharge of Liability on Securities; Defeasance. (a)
------------------------------------------------
When (1) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.07) for cancellation or (2) all
outstanding Securities have become due and payable, whether at maturity or on a
redemption date as a result of the mailing of a notice of redemption pursuant to
Article 3 hereof and the Company irrevocably deposits with the Trustee funds
sufficient to pay at maturity or upon redemption all outstanding Securities,
including interest thereon to maturity or such redemption date (other than
Securities replaced pursuant to Section 2.07), and if in either case the Company
pays all other sums payable hereunder by the Company, then this Indenture shall,
subject to Section 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.
(b) Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (1) all its obligations under the Securities and this Indenture
("legal defeasance option") or (2) its obligations under Sections 4.02, 4.03,
4.04, 4.05, 4.06, 4.07, 4.08, 4.09 and 4.10 and the operation of Sections
6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of Sections
6.01(7) and (8), with respect only to Significant Subsidiaries) and the
limitations contained in Section 5.01(a)(3) ("covenant defeasance option"). The
Company may exercise its legal
81
defeasance option notwithstanding its prior exercise of its covenant defeasance
option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of the
Securities may not be accelerated because of an Event of Default specified in
Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of
Sections 6.01(7) and (8), with respect only to Significant Subsidiaries) or
because of the failure of the Company to comply with Section 5.01(a)(3). If the
Company exercises its legal defeasance option or its covenant defeasance option,
each Guarantor, if any, shall be released from all its obligations with respect
to its Guaranty.
Upon satisfaction of the conditions set forth herein and upon request of
the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's obligations
in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07 and 7.08 and in this
Article 8 shall survive until the Securities have been paid in full. Thereafter,
the Company's obligations in Sections 7.07, 8.04 and 8.05 shall survive.
SECTION 8.02. Conditions to Defeasance. The Company may exercise its
------------------------
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee money
or U.S. Government Obligations for the payment of principal of and interest
on the Securities to maturity or redemption, as the case may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay principal and interest when due
on all the Securities to maturity or redemption, as the case may be;
(3) 123 days pass after the deposit is made and during the 123-day
period no Default specified in
82
Sections 6.01(7) or (8) with respect to the Company occurs which is
continuing at the end of the period;
(4) the deposit does not constitute a default under any other
agreement binding on the Company and is not prohibited by Article 10;
(5) the Company delivers to the Trustee an Opinion of Counsel to
the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under
the Investment Company Act of 1940;
(6) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel stating 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 Securityholders will not recognize
income, gain or loss for Federal income tax purposes as a result of
such 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 defeasance had not occurred;
(7) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Security holders will not recognize income, gain or loss for
Federal income tax purposes as a 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; and
(8) the Company delivers to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
to the defeasance and discharge of the Securities as contemplated by
this Article 8 have been complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.
SECTION 8.03. Application of Trust Money. The Trustee shall hold
--------------------------
in trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It
83
shall apply the deposited money and the money from U.S. Government Obligations
through the Paying Agent and in accordance with this Indenture to the payment of
principal of and interest on the Securities. Money and securities so held in
trust are not subject to Article 10.
SECTION 8.04. Repayment to Company. The Trustee and the Paying
--------------------
Agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon request any money held by them for
the payment of principal or interest that remains unclaimed for two years, and,
thereafter, Securityholders entitled to the money must look to the Company for
payment as general creditors.
SECTION 8.05. Indemnity for Government Obligations. The Company
------------------------------------
shall pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is
-------------
unable to apply any money or U.S. Government Obligations in accordance with this
Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities and the Guarantors' obligations under their
respective Guaranties shall be revived and reinstated as though no deposit had
occurred pursuant to this Article 8 until such time as the Trustee or Paying
Agent is permitted to apply all such money or U.S. Government Obligations in
accordance with this Article 8; provided, however, that, if the Company has made
-------- -------
any payment of interest on or principal of 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.
84
ARTICLE 9
Amendments
----------
SECTION 9.01. Without Consent of Holders. The Company, the
--------------------------
Guarantors and the Trustee may amend this Indenture, or the Securities without
notice to or consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
-------- -------
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add guarantees with respect to the Securities, including
any Guaranties, or to secure the Securities ;
(5) to add to the covenants of the Company or a Guarantor for the
benefit of the Holders or to surrender any right or power herein
conferred upon the Company or a Guarantor;
(6) to comply with any requirements of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under
the TIA; or
(7) to make any change that does not adversely affect the rights
of any Securityholder.
An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 of any holder of Senior
Indebtedness of the Company or of a Guarantor then outstanding unless the
holders of such Senior Indebtedness (or any group or representative thereof
authorized to give a consent) consent to such change.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
85
SECTION 9.02. With Consent of Holders. The Company, the Guarantors
------------------------
and the Trustee may amend this Indenture or the Securities without notice to any
Securityholder but with the written consent of the Holders of at least a
majority in principal amount of the Securities then outstanding (including
consents obtained in connection with a tender offer or exchange for the
Securities). However, without the consent of each Securityholder affected
thereby, an amendment may not:
(1) reduce the amount of Securities whose Holders must consent to
an amendment;
(2) reduce the rate of or extend the time for payment of interest
on any Security;
(3) reduce the principal amount of or extend the Stated Maturity
of any Security;
(4) reduce the amount payable upon the redemption of any Security
or change the time at which any Security may or shall be redeemed in
accordance with Article 3;
(5) make any Security payable in money other than that stated in
the Security;
(6) make any changes in the ranking or priority of any Security
that would adversely affect the Securityholders;
(7) make any change in Section 6.04 or 6.07 or the second
sentence of this Section; or
(8) make any change in any Guaranty that would adversely affect
the Securityholders.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 or any Guaranty Agreement of
any holder of Senior Indebtedness of the Company or of a Guarantor then
outstanding unless the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent to such change.
86
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment
------------------------------------
to this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. A
----------------------------------------------
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. After an
amendment or waiver becomes effective, it shall bind every Security holder. An
amendment or waiver becomes effective upon the execution of such amendment or
waiver by the Trustee.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Securityholders at such
record date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
SECTION 9.05. Notation on or Exchange of Securities. If an amendment
--------------------------------------
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 regarding 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. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
87
SECTION 9.06. Trustee To Sign Amendments. The Trustee shall sign any
---------------------------
amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture.
SECTION 9.07. Payment for Consent. Neither the Company nor any
--------------------
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 10
Subordination
-------------
SECTION 10.01. Agreement To Subordinate. The Company agrees, and each
-------------------------
Securityholder by accepting a Security agrees, that the Indebtedness evidenced
by the Securities is subordinated in right of payment, to the extent and in the
manner provided in this Article 10, to the prior payment of all Senior
Indebtedness of the Company and that the subordination is for the benefit of and
enforceable by the holders of such Senior Indebtedness. The Securities shall in
all respects rank pari passu with all other Senior Subordinated Indebtedness of
---- -----
the Company and only Indebtedness of the Company which is Senior Indebtedness of
the Company shall rank senior to the Securities in accordance with the
provisions set forth herein. All provisions of this Article 10 shall be subject
to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bankruptcy. Upon any payment
-------------------------------------
or distribution of the assets of the Company to creditors upon a total or
partial liquidation
88
or a total or partial dissolution of the Company or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property:
(1) holders of Senior Indebtedness of the Company shall be
entitled to receive payment in full in cash of such Senior Indebtedness
before Securityholders shall be entitled to receive any payment; and
(2) until the Senior Indebtedness of the Company is paid in full
in cash, any payment or distribution to which Securityholders would be
entitled but for this Article 10 shall be made to holders of such
Senior Indebtedness as their interests may appear, except that
Securityholders may receive shares of stock and any debt securities
that are subordinated to such Senior Indebtedness to at least the same
extent as the Securities.
SECTION 10.03. Default on Senior Indebtedness of the Company. The
----------------------------------------------
Company shall not pay the principal of, premium, if any, or interest on the
Securities or make any deposit pursuant to Section 8.01 and may not purchase,
redeem or (except for Securities delivered to the Trustee pursuant to the second
sentence of paragraph 6 of the Securities) otherwise retire any Securities
(except for any redemption pursuant to paragraph 6 of the Securities)
(collectively, "pay the Securities") if either of the following (a "Payment
Default") occurs (1) any Designated Senior Indebtedness of the Company is not
paid in full in cash when due; or (2) any other default on Designated Senior
Indebtedness of the Company occurs and the maturity of such Designated Senior
Indebtedness is accelerated in accordance with its terms unless, in either case,
the Payment Default has been cured or waived and any such acceleration has been
rescinded or such Designated Senior Indebtedness has been paid in full in cash;
provided, however, that the Company shall be entitled to pay the Securities
-------- -------
without regard to the foregoing if the Company and the Trustee receive written
notice approving such payment from the Representative of any Designated Senior
Indebtedness with respect to which the Payment Default has occurred and is
continuing. During the continuance of any default (other than a Payment Default)
with respect to any Designated Senior Indebtedness of the Company pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, the Company shall not pay the
Securities for a period (a "Payment Blockage Period") commencing upon the
receipt by the Trustee of (with a copy to the Company) written notice (a
"Blockage
89
Notice") of such default from the Representative of such Designated Senior
Indebtedness specifying an election to effect a Payment Blockage Period and
ending 179 days thereafter. The Payment Blockage Period shall end earlier if
such Payment Blockage Period is terminated (1) by written notice to the Trustee
and the Company from the Person or Persons who gave such Blockage Notice; (2)
because the default giving rise to such Blockage Notice is cured, waived or
otherwise no longer continuing; or (3) because such Designated Senior
Indebtedness has been discharged or repaid in full in cash. Notwithstanding the
provisions described in the immediately preceding two sentences (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of such Designated Senior Indebtedness or the Representative of such
Designated Senior Indebtedness shall have accelerated the maturity of such
Designated Senior Indebtedness, the Company shall be entitled to resume payments
on the Securities after termination of such Payment Blockage Period. The
Securities shall not be subject to more than one Payment Blockage Period in any
consecutive 360-day period, irrespective of the number of defaults with respect
to Designated Senior Indebtedness of the Company during such period; provided,
--------
however, that if any Blockage Notice within such 360-day period is given by or
-------
on behalf of any holders of Designated Senior Indebtedness of the Company (other
than the Bank Indebtedness), the Representative of the Bank Indebtedness shall
be entitled to give another Blockage Notice within such period; provided
--------
further, however, that in no event shall the total number of days during which
------- -------
any Payment Blockage Period or Periods is in effect exceed 179 days in the
aggregate during any 360-day consecutive period, and there must be 181 days
during any 360-day consecutive period during which no Payment Blockage Period is
in effect. For purposes of this Section, no default or 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 Indebtedness of the
Company initiating such Payment Blockage Period shall be, or be made, the basis
of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of Securities. If payment of
--------------------------------------
the Securities is accelerated because of an Event of Default, the Company or the
Trustee shall promptly notify the holders of the Designated Senior
90
Indebtedness of the Company (or their Representatives) of the acceleration.
SECTION 10.05. When Distribution Must Be Paid Over. If a
------------------------------------
distribution is made to Securityholders that because of this Article 10 should
not have been made to them, the Securityholders who receive the distribution
shall hold it in trust for holders of Senior Indebtedness of the Company and pay
it over to them as their interests may appear. If any Designated Senior
Indebtedness of the Company is outstanding, the Company shall not pay the
Securities until five Business Days after the Representatives of all the issues
of Designated Senior Indebtedness of the Company receive notice of such
acceleration and, thereafter, shall be entitled to pay the Securities only if
this Article 10 otherwise permits payment at that time.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the
------------
Company is paid in full and until the Securities are paid in full,
Securityholders shall be subrogated to the rights of holders of such Senior
Indebtedness to receive distributions applicable to such Senior Indebtedness. A
distribution made under this Article 10 to holders of such Senior Indebtedness
which otherwise would have been made to Securityholders is not, as between the
Company and Securityholders, a payment by the Company on such Senior
Indebtedness.
SECTION 10.07. Relative Rights. This Article 10 defines the relative
----------------
rights of Securityholders and holders of Senior Indebtedness of the Company.
Nothing in this Indenture shall:
(1) impair, as between the Company and Securityholders, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Securities in accordance with their
terms; or
(2) prevent the Trustee or any Securityholder from exercising its
available remedies upon a Default, subject to the rights of holders of
Senior Indebtedness of the Company to receive distributions otherwise
payable to Securityholders.
SECTION 10.08. Subordination May Not Be Impaired by Company. No
---------------------------------------------
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
91
by any act or failure to act by the Company or by its failure to comply with
this Indenture.
SECTION 10.09. Rights of Trustee and Paying Agent. Notwithstanding
-----------------------------------
Section 10.03, the Trustee or Paying Agent shall continue to make payments on
the Securities and shall not be charged with knowledge of the existence of facts
that under this Article 10 would prohibit the making of any such payments
unless, not less than two Business Days prior to the date of such payment, a
Trust Officer of the Trustee receives notice satisfactory to it that such
payments are prohibited by this Article 10. The Company, the Registrar or co-
registrar, the Paying Agent, a Representative or a holder of Senior Indebtedness
of the Company shall be entitled to give the notice; provided, however, that, if
-------- -------
an issue of Senior Indebtedness of the Company has a Representative, only the
Representative shall be entitled to give the notice.
The Trustee in its individual or any other capacity shall be entitled
to hold Senior Indebtedness of the Company with the same rights it would have if
it were not Trustee. The Registrar and co-registrar and the Paying Agent shall
be entitled to do the same with like rights. The Trustee shall be entitled to
all the rights set forth in this Article 10 with respect to any Senior
Indebtedness of the Company which may at any time be held by it, to the same
extent as any other holder of such Senior Indebtedness; and nothing in Article 7
shall deprive the Trustee of any of its rights as such holder. Nothing in this
Article 10 shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to Representative. Whenever
-----------------------------------------
any Person is to make a distribution or give a notice to holders of Senior
Indebtedness of the Company, such Person shall be entitled to make such
distribution or give such notice to their Representative (if any).
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit
----------------------------------------------------
Right To Accelerate. The failure to make a payment pursuant to the Securities by
--------------------
reason of any provision in this Article 10 shall not be construed as preventing
the occurrence of a Default. Nothing in this Article 10 shall have any effect on
the right of the Securityholders or the Trustee to accelerate the maturity of
the Securities.
SECTION 10.12. Trust Moneys Not Subordinated. Notwithstanding
------------------------------
anything contained herein to the contrary,
92
payments from money or the proceeds of U.S. Government Obligations held in trust
under Article 8 by the Trustee for the payment of principal of and interest on
the Securities shall not be subordinated to the prior payment of any Senior
Indebtedness of the Company or subject to the restrictions set forth in this
Article 10 if the provisions of this Article 10 were not violated at the time
funds were deposited in trust with the Trustee pursuant to Article 8, and none
of the Securityholders shall be obligated to pay over any such amount to the
Company or any holder of Senior Indebtedness of the Company or any other
creditor of the Company.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or
------------------------
distribution pursuant to this Article 10, the Trustee and the Securityholders
shall be entitled to rely (1) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 10.02
are pending, (2) upon a certificate of the liquidating trustee or agent or other
Person making such payment or distribution to the Trustee or to the Security
holders or (3) upon the Representatives of Senior Indebtedness of the Company
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of such Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article 10. In the event that the Trustee determines, in good faith,
that evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness of the Company to participate in any payment or distribution
pursuant to this Article 10, the Trustee shall be entitled to request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of such Senior Indebtedness held by such Person, the extent to which
such Person is entitled to participate in such payment or distribution and other
facts pertinent to the rights of such Person under this Article 10, and, if such
evidence is not furnished, the Trustee shall be entitled to defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment. The provisions of Sections 7.01 and 7.02 shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 10.
SECTION 10.14. Trustee To Effectuate Subordination. Each
-----------------------------------
Securityholder by accepting a Security authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Securityholders and
93
the holders of Senior Indebtedness of the Company as provided in this Article 10
and appoints the Trustee as attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
-------------------------------------------
Indebtedness of the Company. The Trustee shall not be deemed to owe any
---------------------------
fiduciary duty to the holders of Senior Indebtedness of the Company and shall
not be liable to any such holders if it shall mistakenly pay over or distribute
to Securityholders or the Company or any other Person, money or assets to which
any holders of Senior Indebtedness of the Company shall be entitled by virtue of
this Article 10 or otherwise.
SECTION 10.16. Reliance by Holders of Senior Indebtedness of the
-------------------------------------------------
Company on Subordination Provisions. Each Securityholder by accepting a Security
-----------------------------------
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of the Company, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Securities, to acquire and continue
to hold, or to continue to hold, such Senior Indebtedness and such holder of
such Senior Indebtedness shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness.
ARTICLE 11
Guaranties
----------
SECTION 11.01. Guaranties. Each Guarantor hereby unconditionally and
----------
irrevocably guarantees, jointly and severally, to each Holder and to the Trustee
and its successors and assigns (a) the full and punctual payment of principal of
and interest on the Securities when due, whether at maturity, by acceleration,
by redemption or otherwise, and all other monetary obligations of the Company
under this Indenture and the Securities and (b) the full and punctual
performance within applicable grace periods of all other obligations of the
Company under this Indenture and the Securities (all the foregoing being
hereinafter collectively called the "Guaranteed Obligations"). Each Guarantor
further agrees that the Guaranteed Obligations may be extended or renewed, in
whole or in part, without notice or further assent from such Guarantor and that
such Guarantor will remain bound under this Article 11 notwithstanding any
extension or renewal of any Guaranteed Obligation.
94
Each Guarantor waives presentation to, demand of, payment from and
protest to the Company of any of the Guaranteed Obligations and also waives
notice of protest for nonpayment. Each Guarantor waives notice of any default
under the Securities or the Guaranteed Obligations. The obligations of each
Guarantor hereunder shall not be affected by (a) the failure of any Holder or
the Trustee to assert any claim or demand or to enforce any right or remedy
against the Company or any other Person under this Indenture, the Securities or
any other agreement or otherwise; (b) any extension or renewal of any thereof;
(c) any rescission, waiver, amendment or modification of any of the terms or
provisions of this Indenture, the Securities or any other agreement; (d) the
release of any security held by any Holder or the Trustee for the Guaranteed
Obligations or any of them; (e) the failure of any Holder or the Trustee to
exercise any right or remedy against any other guarantor of the Obligations; or
(f) except as set forth in Section 11.06, any change in the ownership of such
Guarantor.
Each Guarantor further agrees that its Guaranty herein constitutes a
guarantee of payment, performance and compliance when due (and not a guarantee
of collection) and waives any right to require that any resort be had by any
Holder or the Trustee to any security held for payment of the Guaranteed
Obligations.
Each Guaranty is, to the extent and in the manner set forth in Article
12, subordinated and subject in right of payment to the prior payment in full of
the principal of and premium, if any, and interest on all Senior Indebtedness of
the Guarantor giving such Guaranty and each Guaranty is made subject to such
provisions of this Indenture.
Except as expressly set forth in Section 8.01(b), 11.02 and 11.06, the
obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor herein shall not be discharged or impaired or
otherwise affected by the failure of any Holder or the Trustee to assert any
claim or demand or to enforce any remedy under this Indenture, the Securities or
any other agreement, by any waiver or modification of any thereof, by any
default, failure or delay, willful or otherwise, in the performance of the
obligations, or by any
95
other act or thing or omission or delay to do any other act or thing which may
or might in any manner or to any extent vary the risk of such Guarantor or would
otherwise operate as a discharge of such Guarantor as a matter of law or equity.
Each Guarantor further agrees that its Guarantee herein shall continue to
be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by any Holder or the Trustee upon the
bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other right
which any Holder or the Trustee has at law or in equity against any Guarantor by
virtue hereof, upon the failure of the Company to pay the principal of or
interest on any Guaranteed Obligation when and as the same shall become due,
whether at maturity, by acceleration, by redemption or otherwise, or to perform
or comply with any other Guaranteed Obligation, each Guarantor hereby promises
to and shall, upon receipt of written demand by the Trustee, forthwith pay, or
cause to be paid, in cash, to the Holders or the Trustee an amount equal to the
sum of (1) the unpaid amount of such Guaranteed Obligations, (2) accrued and
unpaid interest on such Guaranteed Obligations (but only to the extent not
prohibited by law) and (3) all other monetary Guaranteed Obligations of the
Company to the Holders and the Trustee.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in respect of any Guaranteed Obligations until payment in full of
all Guaranteed Obligations and all obligations to which the Guaranteed
Obligations are subordinated as provided in Article 12. Each Guarantor further
agrees that, as between it, on the one hand, and the Holders and the Trustee, on
the other hand, (x) the maturity of the Guaranteed Obligations may be
accelerated as provided in Article 6 for the purposes of such Guarantor's
Guaranty herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Guaranteed Obligations, and (y)
in the event of any declaration of acceleration of such Guaranteed Obligations
as provided in Article 6, such Guaranteed Obligations (whether or not due and
payable) shall forthwith become due and payable by such Guarantor for the
purposes of this Section.
Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees)
96
incurred by the Trustee or any Holder in enforcing any rights under this
Section.
SECTION 11.02. Limitation on Liability. Any term or provision of this
-----------------------
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
Obligations guaranteed hereunder by any Subsidiary Guarantor shall not exceed
the maximum amount that can be hereby guaranteed without rendering this
Indenture, as it relates to such Subsidiary Guarantor, voidable under applicable
law relating to fraudulent conveyance or fraudulent transfer or similar laws
affecting the rights of creditors generally.
SECTION 11.03. Successors and Assigns. This Article 11 shall be binding
----------------------
upon each Guarantor and its successors and assigns and shall enure to the
benefit of the successors and assigns of the Trustee and the Holders and, in the
event of any transfer or assignment of rights by any Holder or the Trustee, the
rights and privileges conferred upon that party in this Indenture and in the
Securities shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
SECTION 11.04. No Waiver. Neither a failure nor a delay on the part of
---------
either the Trustee or the Holders in exercising any right, power or privilege
under this Article 11 shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Trustee and the
Holders herein expressly specified are cumulative and not exclusive of any other
rights, remedies or benefits which either may have under this Article 11 at law,
in equity, by statute or otherwise.
SECTION 11.05. Modification. No modification, amendment or waiver of any
------------
provision of this Article 11, nor the consent to any departure by any Guarantor
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Trustee, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. No notice to
or demand on any Guarantor in any case shall entitle such Guarantor to any other
or further notice or demand in the same, similar or other circumstances.
SECTION 11.06. Release of Subsidiary Guarantor. Upon the sale (including
-------------------------------
any sale pursuant to any exercise of remedies by a holder of Senior Indebtedness
of the Company or of such Subsidiary Guarantor) or other
97
disposition (including by way of consolidation or merger) of a Subsidiary
Guarantor or the sale or disposition of all or substantially all the assets of
such Subsidiary Guarantor (in each case other than a sale or disposition to the
Company or an Affiliate of the Company), or at such time a Subsidiary Guarantor
no longer Guarantees any other Indebtedness of the Company, or upon designation
of a Subsidiary Guarantor as an Unrestricted Subsidiary pursuant to the terms of
this Indenture, such Subsidiary Guarantor shall be deemed released from all
obligations under this Article 11 without any further action required on the
part of the Trustee or any Holder. At the request of the Company, the Trustee
shall execute and deliver an appropriate instrument evidencing such release.
SECTION 11.07. Contribution. Each Subsidiary Guarantor that makes a
------------
payment under its Subsidiary Guaranty will be entitled upon payment in full of
all Guaranteed Obligations to a contribution from each other Subsidiary
Guarantor in an amount equal to such other Subsidiary Guarantor's pro rata
portion of such payment based on the respective net assets of all the Subsidiary
Guarantors at the time of such payment determined in accordance with GAAP.
ARTICLE 12
Subordination of Guaranties
---------------------------
SECTION 12.01. Agreement To Subordinate. Each Guarantor agrees, and each
------------------------
Securityholder by accepting a Security agrees, that the Indebtedness evidenced
by such Guarantor's Guaranty is subordinated in right of payment, to the extent
and in the manner provided in this Article 12, to the prior payment of all
Senior Indebtedness of such Guarantor and that the subordination is for the
benefit of and enforceable by the holders of such Senior Indebtedness. The
Guaranteed Obligations of a Guarantor shall in all respects rank pari passu with
---- -----
all other Senior Subordinated Indebtedness of such Guarantor and only Senior
Indebtedness of such Guarantor (including such Guarantor's Guaranty of Senior
Indebtedness of the Company) shall rank senior to the Guaranteed Obligations of
such Guarantor in accordance with the provisions set forth herein.
SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any payment
------------------------------------
or distribution of the assets of any Guarantor to creditors upon a total or
partial liqui-
98
dation or a total or partial dissolution of such Guarantor or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to such
Guarantor or its property:
(1) holders of Senior Indebtedness of such Guarantor shall be entitled
to receive payment in full in cash of such Senior Indebtedness before
Securityholders shall be entitled to receive any payment pursuant to the
Guaranty of such Guarantor; and
(2) until the Senior Indebtedness of any Guarantor is paid in full in
cash, any payment or distribution to which Securityholders would be
entitled but for this Article 12 shall be made to holders of such Senior
Indebtedness as their interests may appear, except that Securityholders may
receive shares of stock and any debt securities of such Guarantor that are
subordinated to such Senior Indebtedness to at least the same extent as its
Guaranty.
SECTION 12.03. Default on Senior Indebtedness of Guarantor. No Guarantor
-------------------------------------------
shall make any payment on its Guaranty or purchase, redeem or otherwise retire
or defease any Securities or other Guaranteed Obligations (collectively, "pay
its Guaranty") if either of the following (a "Payment Default") occurs (1) any
Designated Senior Indebtedness of such Guarantor is not paid in full in cash
when due; or (2) any other default on Designated Senior Indebtedness of such
Guarantor occurs and the maturity of such Designated Senior Indebtedness is
accelerated in accordance with its terms; unless, in either case, the Payment
Default has been cured or waived and any such acceleration has been rescinded or
such Designated Senior Indebtedness has been paid in full in cash; provided,
--------
however, that any Guarantor shall be entitled to pay its Guaranty without regard
-------
to the foregoing if such Guarantor and the Trustee receive written notice
approving such payment from the Representative of any Designated Senior
Indebtedness with respect to which the Payment Default has occurred and is
continuing. During the continuance of any default (other than a Payment Default)
with respect to any Designated Senior Indebtedness of such Guarantor pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, such Guarantor shall not pay its
Guaranty for a period (a "Payment Blockage Period") commencing upon the receipt
by the Trustee of (with a copy to such Guarantor) written notice (a "Blockage
Notice") of such default from the Representative of such Designated
99
Senior Indebtedness specifying an election to effect a Payment Blockage Period
and ending 179 days thereafter. The Payment Blockage Period shall end earlier if
such Payment Blockage Period is terminated (1) by written notice to the Trustee
and such Guarantor from the Person or Persons who gave such Blockage Notice; (2)
because the default giving rise to such Blockage Notice is cured, waived or
otherwise no longer continuing; or (3) because such Designated Senior
Indebtedness has been discharged or repaid in full in cash. Notwithstanding the
provisions described in the immediately preceding two sentences (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of such Designated Senior Indebtedness giving such Payment Notice or the
Representative of such Designated Senior Indebtedness shall have accelerated the
maturity of such Designated Senior Indebtedness, any Guarantor shall be entitled
to resume payments pursuant to its Guaranty after termination of such Payment
Blockage Period. No Guarantor shall be subject to more than one Blockage Period
in any consecutive 360-day period, irrespective of the number of defaults with
respect to Designated Senior Indebtedness of such Guarantor during such period;
provided, however, that if any Blockage Notice within such 360-day period is
-------- -------
given by or on behalf of any holders of Designated Senior Indebtedness of such
Guarantor (other than the Bank Indebtedness), the Representative of the Bank
Indebtedness shall be entitled to give another Blockage Notice within such
period; provided further, however, that in no event shall the total number of
---------------- -------
days during which any Payment Blockage Period or Periods is in effect exceed 179
days in the aggregate during any 360-day consecutive period, and there must be
181 days during any 360-day consecutive period during which no Payment Blockage
Period is in effect. For purposes of this Section, no default or 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 Indebtedness of
such Guarantor initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 12.04. Demand for Payment. If a demand for payment is made
-------------------
on a Guarantor pursuant to Article 11, the Trustee shall promptly notify the
holders of the Designated Senior Indebtedness of such Guarantor (or their
Representatives) of such demand.
100
SECTION 12.05. When Distribution Must Be Paid Over. If a distribution is
-----------------------------------
made to Securityholders that because of this Article 12 should not have been
made to them, the Securityholders who receive the distribution shall hold it in
trust for holders of Senior Indebtedness of the applicable Guarantor and pay it
over to them or their Representatives as their interests may appear. If any
Designated Senior Indebtedness of a Subsidiary Guarantor is outstanding, such
Subsidiary Guarantor shall not make a payment on its Guaranty until five
Business Days after the Representations of all the issuers of Designated Senior
Indebtedness of such Guarantor receive notice of such acceleration and,
thereafter, shall be entitled to pay the Securities only if Article 12 otherwise
permits payment at that time.
SECTION 12.06. Subrogation. After all Senior Indebtedness of a Guarantor
-----------
is paid in full and until the Securities are paid in full, Securityholders shall
be subrogated to the rights of holders of such Senior Indebtedness to receive
distributions applicable to Senior Indebtedness of such Guarantor. A
distribution made under this Article 12 to holders of such Senior Indebtedness
which otherwise would have been made to Securityholders is not, as between the
relevant Guarantor and Securityholders, a payment by such Guarantor on such
Senior Indebtedness.
SECTION 12.07. Relative Rights. This Article 12 defines the relative
----------------
rights of Securityholders and holders of Senior Indebtedness of a Guarantor.
Nothing in this Indenture shall:
(1) impair, as between a Guarantor and Security holders, the
obligation of such Guarantor, which is absolute and unconditional, to pay
its Guaranty to the extent set forth in Article 11; or
(2) prevent the Trustee or any Securityholder from exercising its
available remedies upon a default by such Guarantor under its Guaranty,
subject to the rights of holders of Senior Indebtedness of such Guarantor
to receive distributions otherwise payable to Securityholders.
SECTION 12.08. Subordination May Not Be Impaired by Company. No right
--------------------------------------------
of any holder of Senior Indebtedness of any Guarantor to enforce the
subordination of the Guaranty of such Guarantor shall be impaired by any act or
failure to act by such Guarantor or by its failure to comply with this
Indenture.
101
SECTION 12.09. Rights of Trustee and Paying Agent. Notwithstanding
----------------------------------
Section 12.03, the Trustee or Paying Agent shall continue to make payments on
any Guaranty and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Trust Officer of the Trustee
receives written notice satisfactory to it that such payments are prohibited by
this Article 12. The Company, the relevant Guarantor, the Registrar or co-
registrar, the Paying Agent, a Representative or a holder of Senior Indebtedness
of such Guarantor shall be entitled to give the notice; provided, however, that,
-------- -------
if an issue of Senior Indebtedness of any Guarantor has a Representative, only
the Representative shall be entitled to give the notice.
The Trustee in its individual or any other capacity shall be entitled to
hold Senior Indebtedness of any Guarantor with the same rights it would have if
it were not the Trustee. The Registrar and co-registrar and the Paying Agent may
do the same with like rights. The Trustee shall be entitled to all the rights
set forth in this Article 12 with respect to any Senior Indebtedness of any
Guarantor which may at any time be held by it, to the same extent as any other
holder of such Senior Indebtedness; and nothing in Article 7 shall deprive the
Trustee of any of its rights as such holder. Nothing in this Article 12 shall
apply to claims of, or payments to, the Trustee under or pursuant to Section
7.07.
SECTION 12.10. Distribution or Notice to Representative. Whenever any
----------------------------------------
Person is to make a distribution or give a notice to holders of Senior
Indebtedness of any Guarantor, such Person shall be entitled to make such
distribution or give such notice to their Representative (if any).
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right
----------------------------------------------------------
To Demand Payment. The failure to make a payment pursuant to a Guaranty by
------------------
reason of any provision in this Article 12 shall not be construed as preventing
the occurrence of a Default. Nothing in this Article 12 shall have any effect on
the right of the Securityholders or the Trustee to make a demand for payment on
any Guarantor pursuant to its Guaranty.
SECTION 12.12. Trustee Entitled To Rely. Upon any payment or
------------------------
distribution pursuant to this Article 12, the Trustee and the Securityholders
shall be entitled to rely (1) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to
102
in Section 12.02 are pending, (2) upon a certificate of the liquidating trustee
or agent or other Person making such payment or distribution to the Trustee or
to the Securityholders or (3) upon the Representatives for the holders of Senior
Indebtedness of any Guarantor for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of such
Senior Indebtedness and other indebtedness of such Guarantor, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 12. In the event that the
Trustee determines, in good faith, that evidence is required with respect to the
right of any Person as a holder of Senior Indebtedness of any Guarantor to
participate in any payment or distribution pursuant to this Article 12, the
Trustee shall be entitled to request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
of such Guarantor held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article 12, and, if such
evidence is not furnished, the Trustee shall be entitled to defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment. The provisions of Sections 7.01 and 7.02 shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 12.
SECTION 12.13. Trustee To Effectuate Subordination. Each Securityholder
-----------------------------------
by accepting a Security authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Securityholders and the holders of Senior Indebtedness
of any Guarantor as provided in this Article 12 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness
--------------------------------------------------------
of Guarantor. The Trustee shall not be deemed to owe any fiduciary duty to the
------------
holders of Senior Indebtedness of any Guarantor and shall not be liable to any
such holders if it shall mistakenly pay over or distribute to Securityholders or
the Company or any other Person, money or assets to which any holders of such
Senior Indebtedness shall be entitled by virtue of this Article 12 or otherwise.
SECTION 12.15. Reliance by Holders of Senior Indebtedness of Guarantors
--------------------------------------------------------
on Subordination Provisions. Each Securityholder by accepting a Security
----------------------------
acknowledges and agrees that the foregoing subordination provisions are, and
103
are intended to be, an inducement and a consideration to each holder of any
Senior Indebtedness of any Guarantor, whether such Senior Indebtedness was
created or acquired before or after the issuance of the Securities, to acquire
and continue to hold, or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.
ARTICLE 13
Miscellaneous
-------------
SECTION 13.01. Trust Indenture Act Controls. If any provision of this
----------------------------
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 13.02. Notices. Any notice or communication shall be in
--------
writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company or any Guarantor:
XXXX XX Corp.
000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx
Attention of Xxxx Xxxxxx
if to the Trustee:
State Street Bank and Trust Company of
California, N.A.
000 Xxxx 0xx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Corporate Trust Administration
(XXXX XX Corp. 11 1/4% Senior Subordinated Notes
due June 15, 2011)
The Company, any Guarantor or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Securityholder shall be mailed to
the Securityholder at the Secu-
104
rityholder's address as it appears on the registration books of the Registrar
and shall be sufficiently given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. Communication by Holders with Other Holders.
-------------------------------------------
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, any Guarantor, the Trustee, the Registrar and anyone
else shall have the protection of TIA (S) 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent. Upon
--------------------------------------------------
any request or application by the Company to the Trustee to take or refrain from
taking any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee 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 in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion. Each
---------------------------------------------
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual 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 individual, he has made
such examination or
105
investigation as is necessary to enable him to express an informed opinion
as to whether or not such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.06. When Securities Disregarded. 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 or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded. Also,
subject to the fore going, only Securities outstanding at the time shall be
considered in any such determination.
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar. The
--------------------------------------------
reasonable rules for action by or a meeting of Securityholders. The Registrar
and the Paying Agent may make reasonable rules for their functions.
SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a Sunday
--------------
or a day on which commercial banking institutions are authorized or required by
law to close in New York City. If a payment date is a Legal Holiday, payment
shall be made on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period. If a regular record date is a
Legal Holiday, the record date shall not be affected.
SECTION 13.09. Governing Law. This Indenture and the Securities shall
-------------
be governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 13.10. No Recourse Against Others. A director, officer, employee
--------------------------
or stockholder, as such, of the Company or any Guarantor shall not have any
liability for any obligations of the Company under the Securities or this
Indenture or of such Guarantor under its Guaranty or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall waive and release
all such liability. The waiver and release shall be part of the consideration
for the issue of the Securities.
106
SECTION 13.11. Successors. All agreements of the Company and the
-----------
Guarantors in this Indenture and the Securities shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 13.12. Multiple Originals. The parties may sign any number of
-------------------
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
SECTION 13.13. Table of Contents; Headings. The table of contents, cross-
---------------------------
reference sheet and headings of the Articles and Sections of this Indenture have
been inserted for convenience of reference only, are not intended to be
considered a part hereof and shall not modify or restrict any of the terms or
provisions hereof.
107
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
XXXX XX CORP.,
by /s/ Claus X. Xxxxxx
-------------------------
Name: Claus X. Xxxxxx
Title: President
CBRE HOLDING, INC.,
by /s/ Claus X. Xxxxxx
-------------------------
Name: Claus X. Xxxxxx
Title: President
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A.,
by /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx Xxxxxx
Title: Vice President
RULE 144A/REGULATION S APPENDIX
PROVISIONS RELATING TO INITIAL SECURITIES,
------------------------------------------
PRIVATE EXCHANGE SECURITIES
---------------------------
AND EXCHANGE SECURITIES
-----------------------
1. Definitions
-----------
1.1 Definitions
-----------
For the purposes of this Appendix the following terms shall have the meanings
indicated below:
"Depository" means The Depository Trust Company, its nominees and their
respective successors.
"Exchange Securities" means (1) the 11 1/4% Senior Subordinated Notes Due
June 15, 2011 issued pursuant to the Indenture in connection with a Registered
Exchange Offer pursuant to a Registration Rights Agreement and (2) Additional
Securities, if any, issued pursuant to a registration statement filed with the
SEC under the Securities Act.
"Initial Purchasers" means (1) with respect to the Initial Securities issued
on the Issue Date, Credit Suisse First Boston Corporation, Credit Lyonnais
Securities (USA) Inc., HSBC Securities (USA) Inc. and Scotia Capital (USA) Inc.
and (2) with respect to each issuance of Additional Securities, the Persons
purchasing such Additional Securities under the related Purchase Agreement.
"Initial Securities" means (1) $229.0 million aggregate principal amount of
11 1/4% Senior Subordinated Notes Due June 15, 2011 issued on the Issue Date and
(2) Additional Securities, if any, issued in a transaction exempt from the
registration requirements of the Securities Act.
"Private Exchange" means the offer by the Company, pursuant to a Registration
Rights Agreement, to the Initial Purchasers to issue and deliver to the Initial
Purchasers, in exchange for the Initial Securities held by the Initial
Purchasers as part of its initial distribution, a like aggregate principal
amount of Private Exchange Securities.
"Private Exchange Securities" means any 11 1/4% Senior Subordinated Notes Due
June 15, 2011 issued in connection with a Private Exchange.
"Purchase Agreement" means (1) with respect to the Initial Securities issued
on the Issue Date, the Purchase Agreement dated May 31, 2001 among the Company,
Parent and
2
the Initial Purchasers, as such agreement has been amended on or prior to the
date hereof, and (2) with respect to each issuance of Additional Securities, the
purchase agreement or underwriting agreement among the Company, Parent and the
Persons purchasing such Additional Securities.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registered Exchange Offer" means the offer by the Company, pursuant to a
Registration Rights Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.
"Registration Rights Agreement" means (1) with respect to the Initial
Securities issued on the Issue Date, the Registration Rights Agreement dated May
31, 2001 among the Company, Parent and the Initial Purchasers, and (2) with
respect to each issuance of Additional Securities issued in a transaction exempt
from the registration requirements of the Securities Act, the registration
rights agreement, if any, among the Company and the Persons purchasing such
Additional Securities under the related Purchase Agreement.
"Securities" means the Initial Securities, the Exchange Securities and the
Private Exchange Securities, treated as a single class.
"Securities Custodian" means the custodian with respect to a Global Security
(as appointed by the Depository), or any successor Person thereto and shall
initially be the Trustee.
"Shelf Registration Statement" means the registration statement issued by the
Company in connection with the offer and sale of Initial Securities or Private
Exchange Securities pursuant to a Registration Rights Agreement.
"Transfer Restricted Securities" means Securities that bear or are required
to bear the legend set forth in Section 2.3(b)hereto.
1.2 Other Definitions
-----------------
Defined in
Term Section:
---- -------
"Agent Members"............................................. 2.1(b)
"Global Security"........................................... 2.1(a)
3
"Regulation S".............................................. 2.1(a)
"Restricted Global Security"................................ 2.1(a)
"Rule 144A"................................................. 2.1(a)
2. The Securities.
---------------
2.1 (a) Form and Dating. Initial Securities offered and sold to QIBs in
---------------
reliance on Rule 144A under the Securities Act ("Rule 144A") or in reliance on
Regulation S under the Securities Act ("Regulation S"), in each case as provided
in a Purchase Agreement, and Private Exchange Securities, as provided in a
Registration Rights Agreement, shall be issued initially in the form of one or
more permanent global Securities in definitive, fully registered form without
interest coupons with the global securities legend and restricted securities
legend set forth in Exhibit 1 hereto (each, a "Restricted Global Security"),
which shall be deposited on behalf of the purchasers of the Initial Securities
represented thereby with the Trustee, at its principal corporate trust office,
as custodian for the Depository (or with such other custodian as the Depository
may direct), and registered in the name of the Depository or a nominee of the
Depository, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the Global Securities
may from time to time be increased or decreased by adjustments made on the
records of the Trustee and the Depository or its nominee as hereinafter
provided. Exchange Securities shall be issued in global form (with the global
securities legend set forth in Exhibit 1 hereto) or in certificated form at the
option of the Holders thereof from time to time. Exchange Securities issued in
global form and Restricted Global Securities are sometimes referred to in this
Appendix as "Global Securities."
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
----------------------
Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance with this
Section 2.1(b), authenticate and deliver initially one or more Global Securities
that (a) shall be registered in the name of the Depository for such Global
Security or Global Securities or the nominee of such Depository and (b) shall be
delivered by the Trustee to such Depository or pursuant to such Depository's
instructions or held by the Trustee as custodian for the Depository.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by the Depository or by the Trustee as the custodian of the
4
Depository or under such Global Security, and the Company, the Trustee and any
agent of the Company or the Trustee shall be entitled to treat the Depository as
the absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices of such Depository governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.
(c) Certificated Securities. Except as provided in this Section 2.1 or
-----------------------
Section 2.3 or 2.4, owners of beneficial interests in Restricted Global
Securities shall not be entitled to receive physical delivery of certificated
Securities.
2.2 Authentication. The Trustee shall authenticate and deliver: (1) on the
--------------
Issue Date, an aggregate principal amount of $229.0 million 11 1/4% Senior
Subordinated Notes Due June 15, 2011, (2) any Additional Securities for an
original issue in an aggregate principal amount specified in the written order
of the Company pursuant to Section 2.02 of the Indenture and (3) Exchange
Securities or Private Exchange Securities for issue only in a Registered
Exchange Offer or a Private Exchange, respectively, pursuant to a Registration
Rights Agreement, for a like principal amount of Initial Securities, in each
case upon a written order of the Company signed by one Officer. Such order shall
specify the amount of the Securities to be authenticated and the date on which
the original issue of Securities is to be authenticated and, in the case of any
issuance of Additional Securities pursuant to Section 2.13 of the Indenture,
shall certify that such issuance is in compliance with Section 4.03 of the
Indenture.
2.3 Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Global Securities. (i) The transfer and
------------------------------------------
exchange of Global Securities or beneficial interests therein shall be effected
through the Depository, in accordance with this Indenture (including applicable
restrictions on transfer set forth herein, if any) and the procedures of the
Depository therefor. A transferor of a beneficial interest in a Global Security
shall deliver to the Registrar a written order given in accordance with the
Depositary's procedures containing information regarding the participant account
of the Depositary to be credited with a beneficial interest in the Global
Security. The Registrar shall, in accordance with such instructions instruct the
5
Depositary to credit to the account of the Person specified in such instructions
a beneficial interest in the Global Security and to debit the account of the
Person making the transfer the beneficial interest in the Global Security being
transferred.
(ii) Notwithstanding any other provisions of this Appendix (other than the
provisions set forth in Section 2.4), a Global Security may not be transferred
as a whole except by the Depository to a nominee of the Depository or by a
nominee of the Depository to the Depository or another nominee of the Depository
or by the Depository or any such nominee to a successor Depository or a nominee
of such successor Depository.
(iii) In the event that a Restricted Global Security is exchanged for
Securities in certificated registered form pursuant to Section 2.4 of this
Appendix, prior to the consummation of a Registered Exchange Offer or the
effectiveness of a Shelf Registration Statement with respect to such Securities,
such Securities may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3 (including the
certification requirements set forth on the reverse of the Initial Securities
intended to ensure that such transfers comply with Rule 144A or Regulation S, as
the case may be) and such other procedures as may from time to time be adopted
by the Company.
(b) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii) and (iv),
each Security certificate evidencing the Restricted Global Securities (and
all Securities issued in exchange therefor or in substitution thereof) shall
bear a legend in substantially the following form:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES
ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.
EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS
SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(I) THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
6
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (IV)
PURSUANT TO EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I)
THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Restricted
Global Security) pursuant to Rule 144 under the Securities Act, the Registrar
shall permit the transferee thereof to exchange such Transfer Restricted
Security for a certificated Security that does not bear the legend set forth
above and rescind any restriction on the transfer of such Transfer Restricted
Security, if the transferor thereof certifies in writing to the Registrar
that such sale or transfer was made in reliance on Rule 144 (such
certification to be in the form set forth on the reverse of the Security).
(iii) After a transfer of any Initial Securities or Private Exchange
Securities pursuant to and during the period of the effectiveness of a Shelf
Registration Statement with respect to such Initial Securities or Private
Exchange Securities, as the case may be, all requirements pertaining to
legends on such Initial Security or such Private Exchange Security will cease
to apply, the requirements requiring any such Initial Security or such
Private Exchange Security issued to certain Holders be issued in global form
will cease to apply, and a certificated Initial Security or Private Exchange
Security or an Initial Security or Private Exchange Security in global form,
in each case without restrictive transfer legends, will be available to the
transferee of the Holder of such Initial Securities or Private Exchange
Securities upon exchange of such transferring Holder's certificated Initial
Security or Private Exchange Security or directions to transfer such Holder's
interest in the Global Security, as applicable.
(iv) Upon the consummation of a Registered Exchange Offer with respect to
the Initial Securities, all requirements pertaining to such Initial
Securities that Initial Securities issued to certain Holders be issued in
global form will still apply with respect to Holders of such Initial
Securities that do not exchange their Initial Securities, and Exchange
7
Securities in certificated or global form will be available to Holders that
exchange such Initial Securities in such Registered Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect to the
Initial Securities, all requirements pertaining to such Initial Securities
that Initial Securities issued to certain Holders be issued in global form
will still apply with respect to Holders of such Initial Securities that do
not exchange their Initial Securities, and Private Exchange Securities in
global form with the global securities legend and the Restricted Securities
Legend set forth in Exhibit 1 hereto will be available to Holders that
exchange such Initial Securities in such Private Exchange.
(c) Cancellation or Adjustment of Global Security. At such time as all
---------------------------------------------
beneficial interests in a Global Security have either been exchanged for
certificated Securities, redeemed, purchased or canceled, such Global Security
shall be returned to the Depository for cancellation or retained and canceled by
the Trustee. At any time prior to such cancellation, if any beneficial interest
in a Global Security is exchanged for certificated Securities, redeemed,
purchased or canceled, the principal amount of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities Custodian for such
Global Security) with respect to such Global Security, by the Trustee or the
Securities Custodian, to reflect such reduction.
(d) Obligations with Respect to Transfers and Exchanges of Securities.
-----------------------------------------------------------------
(i) To permit registrations of transfers and exchanges, the Company shall
execute and the Trustee shall authenticate certificated Securities and Global
Securities at the Registrar's or co-registrar's request.
(ii) 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, assessments, or similar governmental charge payable in
connection therewith (other than any such transfer taxes, assessments or
similar governmental charge payable upon exchange or transfer pursuant to
Sections 2.06, 3.06 and 4.09 of the Indenture).
(iii) The Registrar or co-registrar shall not be required to register the
transfer of or exchange of any Security for a period beginning 15 Business
Days before the mailing of a notice of an offer to repurchase or redeem
Securities or 15 Business Days before an interest payment date.
8
(iv) Prior to the due presentation for registration of transfer of any
Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such Security and for all
other purposes whatsoever, whether or not such Security is overdue, and none
of the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar shall be affected by notice to the contrary.
(v) All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture shall evidence the same debt and shall be entitled to
the same benefits under this Indenture as the Securities surrendered upon
such transfer or exchange.
(e) No Obligation of the Trustee.
----------------------------
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in the
Depository or other Person with respect to the accuracy of the records of the
Depository or its nominee or of any participant or member thereof, with
respect to any ownership interest in the Securities or with respect to the
delivery to any participant, member, beneficial owner or other Person (other
than the Depository) of any notice (including any notice of redemption) or
the payment of any amount, under or with respect to such Securities. All
notices and communications to be given to the Holders and all payments to be
made to Holders under the Securities shall be given or made only to or upon
the order of the registered Holders (which shall be the Depository or its
nominee in the case of a Global Security). The rights of beneficial owners in
any Global Security shall be exercised only through the Depository subject to
the applicable rules and procedures of the Depository. The Trustee may rely
and shall be fully protected in relying upon information furnished by the
Depository with respect to its members, participants and any beneficial
owners.
(ii) The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among Depository
participants, members or beneficial owners in any Global Security) other than
to require delivery of such certificates and other documentation or evidence
as are expressly required by, and to do so if and when expressly required by,
the terms of this Indenture, and to examine the
9
same to determine substantial compliance as to form with the express
requirements hereof.
2.4 Certificated Securities.
-----------------------
(a) A Restricted Global Security deposited with the Depository or with the
Trustee as custodian for the Depository pursuant to Section 2.1 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities in an aggregate principal amount equal to the principal amount of
such Global Security, in exchange for such Global Security, only if such
transfer complies with Section 2.3 and (i) the Depository notifies the Company
that it is unwilling or unable to continue as Depository for such Restricted
Global Security or if at any time such Depository ceases to be a "clearing
agency" registered under the Exchange Act and a successor depositary is not
appointed by the Company within 90 days of such notice, or (ii) an Event of
Default has occurred and is continuing or (iii) the Company, in its sole
discretion, notifies the Trustee in writing that it elects to cause the issuance
of certificated Securities under this Indenture.
(b) Any Restricted Global Security that is transferable to the beneficial
owners thereof pursuant to this Section shall be surrendered by the Depository
to the Trustee located at its principal corporate trust office in the Borough of
Manhattan, The City of New York, to be so transferred, in whole or from time to
time in part, without charge, and the Trustee shall authenticate and deliver,
upon such transfer of each portion of such Restricted Global Security, an equal
aggregate principal amount of certificated Initial Securities of authorized
denominations. Any portion of a Restricted Global Security transferred pursuant
to this Section shall be executed, authenticated and delivered only in
denominations of $1,000 principal amount and any integral multiple thereof and
registered in such names as the Depository shall direct. Any certificated
Initial Security or Private Exchange Security delivered in exchange for an
interest in the Restricted Global Security shall, except as otherwise provided
by Section 2.3(b), bear the restricted securities legend set forth in Exhibit 1
hereto.
(c) Subject to the provisions of Section 2.4(b), the registered Holder of a
Global Security shall be entitled to grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.
(d) In the event of the occurrence of either of the events specified in
Section 2.4(a), the Company shall promptly make
10
available to the Trustee a reasonable supply of certificated Securities in
definitive, fully registered form without interest coupons.
EXHIBIT 1
to
RULE 144A/REGULATION S APPENDIX
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, 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 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
[FOR REGULATION S GLOBAL NOTE ONLY] UNTIL 40 DAYS AFTER THE COMMENCEMENT OF
THE OFFERING, AN OFFER OR SALE OF NOTES WITHIN THE UNITED STATES BY A DEALER (AS
DEFINED IN THE U.S. SECURITIES ACT) MAY VIOLATE THE REGISTRATION REQUIREMENTS OF
THE U.S. SECURITIES ACT IF SUCH OFFER OR SALE IS MADE OTHERWISE THAN IN
ACCORDANCE WITH RULE 144A THEREUNDER.
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES
ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED OF IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) THE
COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE
2
REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
3
CUSIP
-------
No.
----------- $
-------
11 1/4% Senior Subordinated Notes Due June 15, 2011
Xxxx XX Corp., a Delaware corporation, promises to pay to
, or registered assigns, the principal sum of
Dollars on June 15, 2011.
Interest Payment Dates: June 15 and December 15.
Record Dates: June 1 and December 1.
Additional provisions of this Security are set forth on the other
side of this Security.
Dated: June 7, 2001
XXXX XX CORP.,
by
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A.
as Trustee, certifies that
this is one of the
Securities referred to in
the Indenture.
by
Authorized Signatory
4
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
11 1/4% Senior Subordinated Note Due June 15, 2011
1. Interest
--------
Xxxx XX Corp., a Delaware corporation (such corporation, and its successors
and assigns under the Indenture hereinafter referred to, being herein called the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above; provided, however, that if a Registration
-------- -------
Default (as defined in the Registration Rights Agreement) occurs, additional
interest will accrue on this Security at a rate of 0.50% per annum (increasing
by an additional 0.50% per annum after each consecutive 90-day period that
occurs after the date on which such Registration Default occurs up to a maximum
additional interest rate of 2.00%) from and including the date on which any such
Registration Default shall occur to but excluding the date on which all
Registration Defaults have been cured. The Company will pay interest
semiannually on June 15 and December 15 of each year, commencing December 15,
2001. 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 June 7, 2001.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
2. Method of Payment
-----------------
The Company will pay interest on the Securities (except defaulted interest)
to the Persons who are registered holders of Securities at the close of business
on the June 1 or December 1 next preceding the interest payment date even if
Securities are canceled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will 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. Payments in respect of the Securities represented by a Global
Security (including principal, premium and interest) will be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company. The Company will make all payments in respect of a
certificated Security (including principal, premium and interest) by mailing a
check to the registered address of each Holder thereof; provided, however, that
-------- -------
payments on a certificated Security will be made by wire transfer to a U.S.
dollar account maintained by the payee with
5
a bank in the United States if such Holder elects payment by wire transfer by
giving written notice to the Trustee or the Paying Agent to such effect
designating such account no later than 30 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
--------------------------
Initially, State Street Bank and Trust Company of California, N.A. (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co- registrar.
4. Indenture
---------
The Company issued the Securities under an Indenture dated as of June 7, 2001
("Indenture"), between the Company, Parent and the Trustee. 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.C. xx.xx.
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured obligations of the Company. The Company
shall be entitled, subject to its compliance with Section 4.03 of the Indenture,
to issue Additional Securities pursuant to Section 2.13 of the Indenture. The
Initial Securities issued on the Issue Date, any Additional Securities and all
Exchange Securities or Private Exchange Securities issued in exchange therefor
will be treated as a single class for all purposes under the Indenture. The
Indenture contains covenants that limit the ability of the Company and its
subsidiaries to incur additional indebtedness; pay dividends or distributions
on, or redeem or repurchase capital stock; make investments; issue or sell
capital stock of subsidiaries; engage in transactions with affiliates; transfer
or sell assets; guarantee indebtedness; restrict dividends or other payments of
subsidiaries; and consolidate, merge or transfer all or substantially all of its
assets and the assets of its
6
subsidiaries. These covenants are subject to important exceptions and
qualifications.
5. Optional Redemption
-------------------
Except as set forth below, the Company shall not be entitled to redeem the
Securities at its option prior to June 15, 2006.
On and after June 15, 2006, the Company shall be entitled at its option to
redeem all or a portion of the Securities upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed in percentages of principal
amount on the redemption date), plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date), if redeemed during
the 12-month period commencing on June 15 of the years set forth below:
Redemption
Period Price
------ ----------
2006 105.625%
2007 103.750
2008 101.875
2009 and thereafter 100.000%
In addition, prior to June 15, 2004, the Company shall be entitled at its
option on one or more occasions to redeem Securities (which includes Additional
Securities, if any) in an aggregate principal amount not to exceed 35% of the
aggregate principal amount of the Securities (which includes Additional
Securities, if any) originally issued at a redemption price (expressed as a
percentage of principal amount) of 111 1/4%, plus accrued and unpaid interest to
the redemption date, with the net cash proceeds from one or more Public Equity
Offerings (provided that if the Public Equity Offering is an offering by Parent,
--------
a portion of the Net Cash Proceeds thereof equal to the amount required to
redeem any Securities is contributed to the equity capital of the Company);
provided, however, that (1) at least 65% of such aggregate principal amount of -
-------- -------
Securities (which includes Additional Securities, if any) remains outstanding
immediately after the occurrence of each such redemption (other than Securities
held, directly or indirectly, by the Company or its Affiliates); and (2) each
such redemption occurs within 90 days after the date of the related Public
Equity Offering.
7
6. Special Mandatory Redemption
----------------------------
In the event the Transactions are not consummated on or prior to the 75th day
after the Issue Date or the Merger Agreement is terminated at any time prior
thereto, the Company shall redeem the Securities at a redemption price equal to
100% of the accreted value thereof on the redemption date (calculated for the
period from the Issue Date to such redemption date based on the straight line
method over the life of the Securities), plus accrued and unpaid interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date). The
Company shall be entitled to receive a credit against the accreted value of the
Securities required to be redeemed pursuant to this paragraph equal to the
accreted value on such redemption date (excluding premium) of any Securities
that the Company has acquired or redeemed other than pursuant to this paragraph
and has delivered to the Trustee for cancellation. The Company shall be entitled
to receive the credit only once for any Security. The Company shall cause the
notice of the special mandatory redemption to be mailed no later than the next
Business Day following the 75th day after the Issue Date or following the date
the Merger Agreement is terminated, as applicable, and shall redeem the
Securities three Business Days following the date of notice of redemption.
7. Notice of Redemption
--------------------
Except as set forth in paragraph 6 above, 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 his registered address. Securities in
denominations larger than $1,000 principal amount may be redeemed in part but
only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.
8. Put Provisions
--------------
Upon a Change of Control, any Holder of Securities will have the right,
subject to certain conditions, to cause the Company to purchase all or any part
of the Securities of such Holder at a purchase price equal to 101% of the
principal amount
8
thereof on the date of purchase plus accrued and unpaid interest to the date of
repurchase (subject to the right of holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.
9. Subordination
-------------
The Securities are subordinated to Senior Indebtedness of the Company, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. The
Company agrees, and each Securityholder by accepting a Security agrees, to the
subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such purpose.
10. Guaranty
--------
The payment by the Company of the principal of, and premium and interest on,
the Securities is fully and unconditionally guaranteed on a joint and several
senior subordinated basis by each of the Guarantors.
11. Denominations; Transfer; Exchange
---------------------------------
The Securities are in registered form without coupons in denominations of
$1,000 principal amount and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
12. Persons Deemed Owners
---------------------
The registered Holder of this Security may be treated as the owner of it for
all purposes.
13. Unclaimed Money
---------------
9
If money for the payment of principal or interest remains unclaimed for two
years, the Trustee or Paying Agent shall pay the money back to the Company at
its request unless an abandoned property law designates another Person. After
any such payment, Holders entitled to the money must look only to the Company
and not to the Trustee for payment.
14. Discharge and Defeasance
------------------------
Subject to certain conditions, the Company at any time shall be entitled to
terminate some or all of its obligations under the Securities and the Indenture
if the Company deposits with the Trustee money or U.S. Government Obligations
for the payment of principal and interest on the Securities to redemption or
maturity, as the case may be.
15. Amendment, Waiver
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
and the Securities may be amended with the written consent of the Holders of at
least a majority in principal amount outstanding of the Securities and (ii) any
default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount outstanding of the
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Company, the Guarantors and the Trustee
shall be entitled to amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, or to comply with Article 5 of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities, including Guaranties, or to secure the Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or
the Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act or to make any change that does not
adversely affect the rights of any Securityholder.
16. Defaults and Remedies
---------------------
Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 or 6 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required;
10
(iii) failure by the Company, Parent or any Subsidiary Guarantor to comply with
other agreements in the Indenture or the Securities, in certain cases subject to
notice and lapse of time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other Indebtedness of the
Company or any Significant Subsidiary if the amount accelerated (or so unpaid)
exceeds $10.0 million; (v) certain events of bankruptcy or insolvency with
respect to the Company and the Significant Subsidiaries; (vi) certain judgments
or decrees for the payment of money in excess of $10.0 million; and (vii)
certain defaults with respect to Guaranties. If an Event of Default occurs and
is continuing, the Trustee or the Holders of at least 25% in principal amount of
the Securities may declare all the Securities to be due and payable immediately.
Certain events of bankruptcy or insolvency are Events of Default which will
result in the Securities being due and payable immediately upon the occurrence
of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
17. Trustee Dealings with the Company
---------------------------------
Subject to certain limitations imposed by the Act, 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 and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
18. No Recourse Against Others
--------------------------
A director, officer, employee or stockholder, as such, of the Company or the
Trustee shall not have any liability for any obligations 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. By accepting a Security, each
Securityholder waives and releases all such
11
liability. The waiver and release are part of the consideration for the issue of
the Securities.
19. Authentication
--------------
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
20. Abbreviations
-------------
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. CUSIP Numbers
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
22. Holders' Compliance with Registration Rights Agreement.
------------------------------------------------------
Each Holder of a Security, by acceptance hereof, acknowledges and agrees
to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
23. Governing Law.
--------------
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
The Company will furnish to any Securityholder upon written request and
without charge to the Securityholder a
12
copy of the Indenture which has in it the text of this Security in larger type.
Requests may be made to:
XXXX XX Corp.
000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
13
--------------------------------------------------------------------------------
ASSIGNMENT FORM
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)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to
transfer this Security on the books of the Company. The agent may substitute
another to act for him.
--------------------------------------------------------------------------------
Date: ________________ Your Signature: _____________________
--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Securities and the last date, if any, on which such Securities were
owned by the Company or any Affiliate of the Company, the undersigned confirms
that such Securities are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [_] to the Company; or
(2) [_] pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) [_] inside the United States to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933) that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that such transfer
is being made in reliance on Rule 144A, in each
14
case pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
(4) [_] outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933;
or
(5) [_] pursuant to the exemption from registration provided by Rule
144 under the Securities Act of 1933.
If such transfer is being made pursuant to an offshore transaction in
accordance with Rule 904 under the Securities Act, the undersigned further
certifies that:
(i) the offer of the Securities was not made to a person in the
United States;
(ii) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting
on our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated off-shore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
(iii) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903 or Rule 904 of
Regulation S, as applicable;
(iv) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act;
(v) we have advised the transferee of the transfer restrictions
applicable to the Securities; and
(vi) if the circumstances set forth in Rule 904(b) under the
Securities Act are applicable, we have complied with the additional
conditions therein, including (if applicable) sending a confirmation
or other notice stating that the Securities may be offered and sold
during the distribution compliance period specified in Rule 903 of
Regulation S; pursuant to registration of the Securities under the
Securities Act; or pursuant to an available exemption from the
registration requirements under the Securities Act.
15
Unless one of the boxes is checked, the Trustee will refuse to register any
of the Securities evidenced by this certificate in the name of any person
other than the registered holder thereof; provided, however, that if box
-------- -------
(4) or (5) is checked, the Trustee shall be entitled to require, prior to
registering any such transfer of the Securities, such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided
by Rule 144 under such Act.
__________________________________
Signature
Signature Guarantee:
____________________________ ______________________________________
Signature must be guaranteed Signature
Signatures must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
________________________________________________________________________________
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
16
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated: _________________ ______________________________
NOTICE: To be executed by
an executive officer
17
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
Date of Amount of decrease Amount of increase Principal amount Signature of
Exchange in Principal in Principal of this Global authorized officer
amount of this amount of this Security following of Trustee or
Global Security Global Security such decrease or Securities
increase) Custodian
18
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.09 of the Indenture, check the box: [_]
If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.06 or 4.09 of the Indenture, state the amount in
principal amount: $
Date: _______________ Your Signature: ____________________________
(Sign exactly as your name
appears on the other side of
this Security.)
Signature Guarantee: ________________________________________________
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
EXHIBIT A
[FORM OF FACE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY]
*/If the Security is to be issued in global form add the Global Securities -
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] - SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".
**/If the Security is a Private Exchange Security issued in a Private Exchange -
to an Initial Purchaser holding an unsold portion of its initial allotment, add
the Restricted Securities Legend from Exhibit 1 to Appendix A and replace the
Assignment Form included in this Exhibit A with the Assignment Form included in
such Exhibit 1.
2
CUSIP __________
No.______________ $ __________
11 1/4% Senior Subordinated Notes Due June 15, 2011
Xxxx XX Corp., a Delaware corporation, promises to pay to ,
or registered assigns, the principal sum of Dollars on June 15,
2011.
Interest Payment Dates: June 15 and December 15.
Record Dates: June 1 and December 1.
Additional provisions of this Security are set forth on the other side
of this Security.
Dated:
XXXX XX CORP.
by
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A.
as Trustee, certifies that
this is one of the
Securities referred to in
the Indenture.
by
Authorized Signatory
3
[FORM OF REVERSE SIDE OF SECURITY
OR PRIVATE EXCHANGE SECURITY]
11 1/4% Senior Subordinated Note Due June 15, 2011
1. Interest
--------
Xxxx XX Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above; provided, however, that if a
-------- -------
Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will accrue on this Security at a rate of 0.50% per annum
(increasing by an additional 0.50% per annum after each consecutive 90-day
period that occurs after the date on which such Registration Default occurs up
to a maximum additional interest rate of 2.00%) from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured.]1 The Company will pay interest
semiannually on June 15 and December 15 of each year, commencing December 15,
2001. 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 June 7, 2001.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
2. Method of Payment
-----------------
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the June 1 or December 1 next preceding the interest payment date
even if Securities are canceled after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will 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. Payments in respect of the Securities represented by a
Global Security (including principal, premium and interest) will be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company. The Company will make all
-------------------------
1. Insert if at the date of issuance of the Exchange Security or Private
Exchange Security (as the case may be) any Registration Default has
occurred with respect to the related Initial Securities during the interest
period in which such date of issuance occurs.
4
payments in respect of a certificated Security (including principal, premium and
interest) by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on a certificated Security will be made by wire
-------- -------
transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date for
payment (or such other date as the Trustee may accept in its discretion).
3. Paying Agent and Registrar
--------------------------
Initially, State Street Bank and Trust Company of California, N.A. (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.
4. Indenture
---------
The Company issued the Securities under an Indenture dated as of June 7,
2001 ("Indenture"), between the Company, Parent and the Trustee. 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.C. (S)(S)
------
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture, to issue Additional Securities pursuant to Section 2.13 of the
Indenture. The Initial Securities issued on the Issue Date, any Additional
Securities and all Exchange Securities or Private Exchange Securities issued in
exchange therefor will be treated as a single class for all purposes under the
Indenture. The Indenture contains covenants that limit the ability of the
Company and its subsidiaries to incur additional indebtedness; pay dividends or
distributions on, or redeem or repurchase capital stock; make investments; issue
or sell capital stock of subsidiaries; engage in transactions with affiliates;
transfer or sell assets; guarantee indebtedness; restrict dividends or other
payments of subsidiaries; and consolidate, merge or transfer all or
substantially all of its
5
assets and the assets of its subsidiaries. These covenants are subject to
important exceptions and qualifications.
5. Optional Redemption
-------------------
Except as set forth below, the Company shall not be entitled to redeem
the Securities at its option prior to June 15, 2006.
On and after June 15, 2006, the Company shall be entitled at its option
to redeem all or a portion of the Securities upon not less than 30 nor more than
60 days' notice, at the redemption prices (expressed in percentages of principal
amount, on the redemption date) plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date), if redeemed during
the 12-month period commencing on June 15 of the years set forth below:
Redemption
Period Price
------ ----------
2006 105.625%
2007 103.750
2008 101.875
2009 and thereafter 100.000%
In addition, prior to June 15, 2004, the Company shall be entitled at its
option on one or more occasions to redeem Securities (which includes Additional
Securities, if any) in an aggregate principal amount not to exceed 35% of the
aggregate principal amount of the Securities (which includes Additional
Securities, if any) originally issued at a redemption price (expressed as a
percentage of principal amount) of 111 1/4%, plus accrued and unpaid interest to
the redemption date, with the net cash proceeds from one or more Public Equity
Offerings (provided that if the Public Equity Offering is an offering by Parent,
--------
a portion of the Net Cash Proceeds equal to the amount required to redeem any
Securities is contributed to the equity capital of the Company); provided,
--------
however, that (1) at least 65% of such aggregate principal amount of Securities
-------
(which includes Additional Securities, if any) remains outstanding immediately
after the occurrence of each such redemption (other than Securities held,
directly or indirectly, by the Company or its Affiliates); and (2) each such
redemption occurs within 90 days after the date of the related Public Equity
Offering.
6
6. Special Mandatory Redemption
----------------------------
In the event the Transactions are not consummated on or prior to the 75th
day after the Issue Date or the Merger Agreement is terminated at any time prior
thereto, the Company shall redeem the Securities at a redemption price equal to
100% of the accreted value thereof on the redemption date (calculated for the
period from the Issue Date to such redemption date based on the straight line
method over the life of the Securities), plus accrued and unpaid interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date). The
Company shall be entitled to receive a credit against the accreted value of the
Securities required to be redeemed pursuant to this paragraph equal to the
accreted value on such redemption date (excluding premium) of any Securities
that the Company has acquired or redeemed other than pursuant to this paragraph
and has delivered to the Trustee for cancellation. The Company shall be entitled
to receive the credit only once for any Security. The Company shall cause the
notice of the special mandatory redemption to be mailed no later than the next
Business Day following the 75th day after the Issue Date or following the date
the Merger Agreement is terminated, as applicable, and shall redeem the
Securities three Business Days following the date of notice of redemption.
7. Notice of Redemption
--------------------
Except as set forth in paragraph 6 above, 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 his registered address. Securities
in denominations larger than $1,000 principal amount may be redeemed in part but
only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.
8. Put Provisions
--------------
Upon a Change of Control, any Holder of Securities will have the right,
subject to certain conditions, to cause the Company to purchase all or any part
of the Securities of such Holder at a purchase price equal to 101% of the
principal amount thereof on the date of purchase plus accrued and unpaid
interest to the date of repurchase (subject to the right of holders of record on
the relevant record date to receive interest due on the related
7
interest payment date) as provided in, and subject to the terms of, the
Indenture.
9. Subordination
-------------
The Securities are subordinated to Senior Indebtedness of the Company, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. The
Company agrees, and each Securityholder by accepting a Security agrees, to the
subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such purpose.
10. Guarantee
---------
The payment by the Company of the principal of, and premium and interest
on, the Securities is fully and unconditionally guaranteed on a joint and
several senior subordinated basis by each of the Guarantors.
11. Denominations; Transfer; Exchange
---------------------------------
The Securities are in registered form without coupons in denominations of
$1,000 principal amount and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
12. Persons Deemed Owners
---------------------
The registered Holder of this Security may be treated as the owner of it
for all purposes.
13. Unclaimed Money
---------------
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee or Paying Agent shall pay the money back to the Company
at its request unless an abandoned
8
property law designates another Person. After any such payment, Holders entitled
to the money must look only to the Company and not to the Trustee for payment.
14. Discharge and Defeasance
------------------------
Subject to certain conditions, the Company at any time shall be entitled
to terminate some or all of its obligations under the Securities and the
Indenture if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
15. Amendment, Waiver
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture and the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company, the Guarantors and the
Trustee shall be entitled to amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, or to comply with Article 5 of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities, including Guaranties, or to secure the Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or
the Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder.
16. Defaults and Remedies
---------------------
Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 or 6 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required; (iii) failure by the Company, Parent or
any Subsidiary Guarantor to comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of time; (iv) certain
accelerations (including failure to pay within any grace period after final
maturity) of other Indebtedness of the Company or any Significant Subsidiary if
9
the amount accelerated (or so unpaid) exceeds $10.0 million; (v) certain events
of bankruptcy or insolvency with respect to the Company and the Significant
Subsidiaries; (vi) certain judgments or decrees for the payment of money in
excess of $10.0 million; and (vii) certain defaults with respect to the
Guaranties. If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
17. Trustee Dealings with the Company
---------------------------------
Subject to certain limitations imposed by the Act, 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 and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
18. No Recourse Against Others
--------------------------
A director, officer, employee or stockholder, as such, of the Company or
the Trustee shall not have any liability for any obligations 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. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
19. Authentication
--------------
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually
10
signs the certificate of authentication on the other side of this Security.
20. Abbreviations
-------------
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. CUSIP Numbers
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
22. Holders' Compliance with Registration Rights Agreement
------------------------------------------------------
Each Holder of a Security, by acceptance hereof, acknowledges and agrees
to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
23. Governing Law
-------------
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
The Company will furnish to any Securityholder upon written request and
without charge to the Securityholder a copy of the Indenture which has in it the
text of this Security in larger type. Requests may be made to:
XXXX XX Corp.
000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
11
_____________________________________________________________
ASSIGNMENT FORM
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)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security
on the books of the Company. The agent may substitute another to act for him.
____________________________________________________________
Date: ________________ Your Signature: _____________________
____________________________________________________________
Sign exactly as your name appears on the other side of this
Security.
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.09 of the Indenture, check the box: [_]
If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.06 or of the Indenture, state the amount in
principal amount: $
Date: _______________ Your Signature:____________________________
(Sign exactly as your name
appears on the other side of
this Security.)
Signature Guarantee:___________________________________________________
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
