EXECUTION COPY
EXHIBIT 4.2
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Swift Foods Company
as Issuer
S&C Holdco 3, Inc.,
as a Guarantor
10.25% CONVERTIBLE SENIOR SUBORDINATED NOTES DUE 2010
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INDENTURE
Dated as of March 11, 2005
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THE BANK OF NEW YORK TRUST COMPANY, N.A.,
as Trustee
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TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE........................................................... 1
Section 1.01. Definitions.......................................................................... 1
Section 1.02. Other Definitions.................................................................... 29
Section 1.03. Incorporation by Reference of Trust Indenture Act.................................... 30
Section 1.04. Rules of Construction................................................................ 31
ARTICLE 2. THE NOTES............................................................................................ 31
Section 2.01. Authorization, Form and Dating....................................................... 31
Section 2.02. Execution and Authentication......................................................... 32
Section 2.03. Registrar; and Paying Agent and Conversion Agent..................................... 33
Section 2.04. Paying Agent to Hold Money in Trust.................................................. 33
Section 2.05. Holder Lists......................................................................... 33
Section 2.06. Transfer and Exchange................................................................ 34
Section 2.07. Replacement Notes.................................................................... 43
Section 2.08. Outstanding Notes.................................................................... 43
Section 2.09. Treasury Notes....................................................................... 44
Section 2.10. Temporary Notes...................................................................... 44
Section 2.11. Cancellation......................................................................... 44
Section 2.12. Payment Of Interest; Defaulted Interest.............................................. 44
Section 2.13. Cusip or ISIN Numbers................................................................ 44
Section 2.14. Special Interest..................................................................... 45
Section 2.15. Issuance of PIK Notes................................................................ 45
Section 2.16. Rule 144A Availability Notice........................................................ 45
ARTICLE 3. REDEMPTION AND PREPAYMENT............................................................................ 45
Section 3.01. Notices to Trustee................................................................... 45
Section 3.02. Selection of Notes to be Redeemed.................................................... 45
Section 3.03. Notice of Redemption................................................................. 46
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Section 3.04. Effect of Notice of Redemption....................................................... 47
Section 3.05. Deposit of Redemption Price.......................................................... 47
Section 3.06. Notes Redeemed In Part............................................................... 47
Section 3.07. Optional Redemption.................................................................. 47
Section 3.08. Mandatory Redemption or Repurchase................................................... 48
Section 3.09. Offer to Purchase by Application of Excess Proceeds.................................. 48
ARTICLE 4. COVENANTS............................................................................................ 49
Section 4.01. Payment of Notes..................................................................... 50
Section 4.02. Maintenance of Office or Agency...................................................... 51
Section 4.03. Reports.............................................................................. 51
Section 4.04. Compliance Certificates.............................................................. 52
Section 4.05. Taxes................................................................................ 52
Section 4.06. Stay, Extension and Usury Laws....................................................... 53
Section 4.07. Corporate Existence; Ownership of Subsidiaries....................................... 53
Section 4.08. Payments for Consent................................................................. 53
Section 4.09. Incurrence of Additional Debt and Issuance of Capital Stock.......................... 54
Section 4.10. Restricted Payments.................................................................. 54
Section 4.11. Liens................................................................................ 58
Section 4.12. Asset Sales.......................................................................... 58
Section 4.13. Restrictions on Distributions From Subsidiaries...................................... 60
Section 4.14. Affiliate Transactions............................................................... 62
Section 4.15. Layered Debt......................................................................... 63
Section 4.16. Issuance or Sale of Capital Stock of Restricted Subsidiaries......................... 63
Section 4.17. Designation of Restricted and Unrestricted Subsidiaries.............................. 64
Section 4.18. Repurchase at the Option of Holders Upon a Change of Control......................... 64
Section 4.19. Effect Of Change of Control Repurchase Notice........................................ 66
Section 4.20. Deposit Of Change of Control Purchase Price.......................................... 66
Section 4.21. Repayment To SFC..................................................................... 67
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Section 4.22. Notes Purchased In Part.............................................................. 67
Section 4.23. Compliance With Securities Laws Upon Purchase Of Notes............................... 67
Section 4.24. Purchase Of Notes In Open Market..................................................... 67
Section 4.25. Business Activities.................................................................. 67
Section 4.26. Guarantees of Debt by Restricted Subsidiaries and SFC Subsidiaries................... 67
Section 4.27. Seller Note.......................................................................... 69
ARTICLE 5. SUCCESSORS........................................................................................... 69
Section 5.01. Merger, Consolidation and Sale of Assets............................................. 69
Section 5.02. Successor Corporation Substituted.................................................... 71
ARTICLE 6. DEFAULTS AND REMEDIES................................................................................ 71
Section 6.01. Events of Default.................................................................... 71
Section 6.02. Acceleration......................................................................... 73
Section 6.03. Other Remedies....................................................................... 73
Section 6.04. Waiver of Past Defaults.............................................................. 74
Section 6.05. Control by Majority.................................................................. 74
Section 6.06. Limitation on Suits.................................................................. 74
Section 6.07. Rights of Holders to Receive Payment and to Convert.................................. 74
Section 6.08. Collection Suit By Trustee........................................................... 75
Section 6.09. Trustee May File Proofs of Claim..................................................... 75
Section 6.10. Priorities........................................................................... 75
Section 6.11. Undertaking For Costs................................................................ 75
ARTICLE 7. TRUSTEE.............................................................................................. 76
Section 7.01. Duties of Trustee.................................................................... 76
Section 7.02. Rights of Trustee.................................................................... 77
Section 7.03. Individual Rights Of Trustee......................................................... 78
Section 7.04. Trustee's Disclaimer................................................................. 78
Section 7.05. Notice Of Defaults................................................................... 78
Section 7.06. Reports By Trustee To Holders........................................................ 78
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Section 7.07. Compensation and Indemnity........................................................... 78
Section 7.08. Replacement of Trustee............................................................... 79
Section 7.09. Successor Trustee By Merger, Etc..................................................... 80
Section 7.10. Eligibility; Disqualification........................................................ 80
Section 7.11. Preferential Collection of Claims Against SFC........................................ 80
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................................................. 80
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance............................. 80
Section 8.02. Legal Defeasance and Discharge....................................................... 80
Section 8.03. Covenant Defeasance.................................................................. 81
Section 8.04. Conditions To Legal or Covenant Defeasance........................................... 81
Section 8.05. Deposited Cash and U.S. Government Securities to be Held in Trust;
Other Miscellaneous Provisions....................................................... 82
Section 8.06. Repayment to SFC..................................................................... 83
Section 8.07. Reinstatement........................................................................ 83
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER..................................................................... 83
Section 9.01. Without Consent of Holders of Notes.................................................. 83
Section 9.02. With Consent of Holders of Notes..................................................... 84
Section 9.03. With Consent of Holders of Senior Debt............................................... 85
Section 9.04. Compliance With Trust Indenture Act.................................................. 85
Section 9.05. Revocation and Effect of Consents.................................................... 85
Section 9.06. Notation on or Exchange of Notes..................................................... 85
Section 9.07. Trustee to Sign Amendments, Etc...................................................... 86
ARTICLE 10. GUARANTEES.......................................................................................... 86
Section 10.01. Guarantee............................................................................ 86
Section 10.02. Limitation on Guarantor Liability.................................................... 87
Section 10.03. Execution and Delivery of Guarantee.................................................. 87
Section 10.04. Guarantors May Consolidate, Etc., on Certain Terms................................... 88
Section 10.05. Releases Following Sale of Assets.................................................... 88
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ARTICLE 11. SUBORDINATION....................................................................................... 89
Section 11.01. Agreement to Subordinate............................................................. 89
Section 11.02. Liquidation, Dissolution, Bankruptcy................................................. 89
Section 11.03. Default on Senior Debt............................................................... 89
Section 11.04. Acceleration of Payment of Securities................................................ 90
Section 11.05. When Distribution Must Be Paid Over.................................................. 90
Section 11.06. Subrogation.......................................................................... 90
Section 11.07. Relative Rights...................................................................... 90
Section 11.08. Subordination May Not Be Impaired By SFC............................................. 91
Section 11.09. Rights Of Trustee And Paying Agent................................................... 91
Section 11.10. Distribution or Notice To Representative............................................. 91
Section 11.11. Article 11 Not To Prevent Events of Default or Limit Right To Accelerate............. 91
Section 11.12. Trust Moneys Not Subordinated........................................................ 91
Section 11.13. Trustee Entitled To Rely............................................................. 91
Section 11.14. Trustee To Effectuate Subordination.................................................. 92
Section 11.15. Trustee Not Fiduciary For Holders of Senior Debt..................................... 92
Section 11.16. Reliance By Holders Of Senior Debt On Subordination Provisions....................... 92
ARTICLE 12. SUBORDINATION OF GUARANTEES......................................................................... 92
Section 12.01. Agreement to Subordinate............................................................. 92
Section 12.02. Liquidation, Dissolution, Bankruptcy................................................. 92
Section 12.03. Default on Senior Debt of Guarantor.................................................. 93
Section 12.04. Demand For Payment................................................................... 93
Section 12.05. When Distribution Must Be Paid Over.................................................. 93
Section 12.06. Subrogation.......................................................................... 93
Section 12.07. Relative Rights...................................................................... 94
Section 12.08. Subordination May Not Be Impaired By Guarantor....................................... 94
Section 12.09. Rights of Trustee and Paying Agent................................................... 94
Section 12.10. Distribution or Notice To Representative............................................. 94
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Section 12.11. Article 12 Not To Prevent Events of Default Under a Guarantee or
Limit Right To Demand Payment........................................................ 94
Section 12.12. Trustee Entitled To Rely............................................................. 94
Section 12.13. Trustee To Effectuate Subordination.................................................. 95
Section 12.14. Trustee Not Fiduciary For Holders of Senior Debt of Guarantor........................ 95
Section 12.15. Reliance By Holders of Senior Debt of a Guarantor on Subordination
Provisions........................................................................... 95
ARTICLE 13. SATISFACTION AND DISCHARGE.......................................................................... 95
Section 13.01. Satisfaction and Discharge........................................................... 95
Section 13.02. Deposited Cash And U.S. Government Securities to be Held in Trust;
Other Miscellaneous Provisions....................................................... 96
Section 13.03. Repayment To SFC..................................................................... 96
ARTICLE 14. CONVERSION OF NOTES................................................................................. 96
Section 14.01. Conversion Privilege and Conversion Rate............................................. 96
Section 14.02. Conversion Procedure................................................................. 97
Section 14.03. Taxes on Conversion.................................................................. 98
Section 14.04. SFC to Provide Stock................................................................. 98
Section 14.05. Adjustment of Conversion Rate........................................................ 98
Section 14.06. No Adjustment........................................................................ 101
Section 14.07. Fractional Shares.................................................................... 102
Section 14.08. Notice of Adjustment................................................................. 102
Section 14.09. Notice of Certain Transactions....................................................... 102
Section 14.10. Effect of Reclassification, Consolidation, Merger or Sale on Conversion
Privilege............................................................................ 102
Section 14.11. Trustee's Disclaimer................................................................. 103
Section 14.12. Voluntary Increase................................................................... 103
Section 14.13. Payment Upon Conversion.............................................................. 104
Section 14.14. Make Whole Premium Upon Change of Control............................................ 105
Section 14.15. Applicability........................................................................ 111
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ARTICLE 15. MISCELLANEOUS....................................................................................... 112
Section 15.01. Trust Indenture Act Controls......................................................... 112
Section 15.02. Notices.............................................................................. 112
Section 15.03. Communication by Holders of Notes with Other Holders of Notes........................ 113
Section 15.04. Certificate and Opinion as to Conditions Precedent................................... 113
Section 15.05. Statements Required in Certificate or Opinion........................................ 113
Section 15.06. Rules By Trustee and Agents.......................................................... 113
Section 15.07. No Personal Liability of Directors, Officers, Employees and Stockholders............. 114
Section 15.08. Governing Law........................................................................ 114
Section 15.09. No Adverse Interpretation of Other Agreements........................................ 114
Section 15.10. Successors........................................................................... 114
Section 15.11. Severability......................................................................... 114
Section 15.12. Counterpart Originals................................................................ 114
Section 15.13. Table of Contents, Headings, Etc..................................................... 114
Section 15.14. Qualification of This Indenture...................................................... 114
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CROSS-REFERENCE TABLE
TIA Section Indenture Reference Section
310(a)(1)............................................................. Section 7.10
(a)(2)................................................................ Section 7.10
(a)(3)................................................................ N.A.
(a)(4)................................................................ N.A.
(a)(5)................................................................ Section 7.10
(b)................................................................... Section 7.08, Section 7.10
(c)................................................................... N.A.
311(a)................................................................ Section 7.11
(b)................................................................... Section 7.11
(c)................................................................... N.A.
312(a)................................................................ Section 2.05
(b)................................................................... Section 15.03
(c)................................................................... Section 15.03
313(a)................................................................ Section 7.06
(b)(1)................................................................ N.A.
(b)(2)................................................................ Section 7.06, 7.07
(c)................................................................... Section 7.06, 15.02
(d)................................................................... Section 7.06
314(a)................................................................ Section 4.03, Section 4.04, Section 15.02
(b)................................................................... N.A.
(c)(1)................................................................ Section 15.04
(c)(2)................................................................ Section 15.04
(c)(3)................................................................ N.A.
(d)................................................................... N.A.
(e)................................................................... Section 15.05
315(a)................................................................ Section 7.01
(b)................................................................... Section 7.05, Section 15.02
(c)................................................................... Section 7.01
(d)................................................................... Section 7.01
(e)................................................................... Section 6.11
316(a)(last sentence)................................................. Section 2.09
(a)(1)(A)............................................................. Section 6.05
(a)(1)(B)............................................................. Section 6.04
(a)(2)................................................................ N.A.
(b)................................................................... Section 6.07
317(a)(1)............................................................. Section 6.08
(a)(2)................................................................ Section 6.09
(b)................................................................... Section 2.04
318(a)................................................................ Section 15.01
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
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This INDENTURE dated as of March 11, 2005, is by and among Swift
Foods Company, a Delaware corporation ("SFC"), S&C Holdco 3, Inc., a Delaware
corporation ("HoldCo 3"), the other Guarantors listed on the signature pages
hereto, and The Bank of New York Trust Company, N.A., as trustee (the
"Trustee").
SFC, HoldCo 3, the Guarantors and the Trustee agree as follows for
the benefit of each other and for the equal and ratable benefit of the Holders
of the 10.25% Convertible Senior Subordinated Notes due 2010.
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
"144A GLOBAL NOTE" means the Global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"ACQUIRED DEBT" means Debt of a Person or any of its Subsidiaries
existing at the time that Person becomes a Restricted Subsidiary of HoldCo 3 or
at the time it merges or consolidates with HoldCo 3 or any of its Restricted
Subsidiaries or assumed in connection with the acquisition of assets from that
Person.
"ACQUISITION AGREEMENT" means the agreement by and among ConAgra
Foods, S&C Holdco, Inc. (subsequently known as Swift Foods Company) and HMTF
Rawhide, L.P., dated as of May 20, 2002, as amended from time to time in
accordance with this Indenture.
"AFFILIATE" means, as to any Person, any other Person which,
directly or indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person. The term "CONTROL"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "CONTROLLED" have meanings correlative to the foregoing.
"AGENT" means any Registrar, co-registrar, Paying Agent or
additional paying agent, Conversion Agent or additional conversion agent.
"APPLICABLE PROCEDURES" means, with respect to any transfer,
redemption or exchange of or for beneficial interests in any Global Note, the
rules and procedures of the Depositary, Euroclear and Clearstream that apply to
such transfer, redemption or exchange.
"ASSET SALE" means any sale, lease (other than operating leases
entered into in the ordinary course of business), transfer, issuance or other
disposition (or series of related sales, leases, transfers, issuances or
dispositions that are part of a common plan) of shares of Capital Stock of a
Restricted Subsidiary (other than directors' qualifying shares), property or
other assets (each referred to for the purposes of this definition as a
"disposition") by HoldCo 3 or any of its Restricted Subsidiaries (including any
disposition by means of a merger, consolidation or similar transaction) other
than:
(1) a disposition by a Restricted Subsidiary to HoldCo 3, by HoldCo
3 or a Restricted Subsidiary to a Wholly Owned Restricted Subsidiary or by
a Foreign Restricted Subsidiary to another Foreign Restricted Subsidiary;
(2) a disposition of inventory in the ordinary course of business;
(3) a disposition of obsolete or worn out equipment or equipment
that is no longer useful in the conduct of the business of HoldCo 3 and
its Restricted Subsidiaries and that is disposed of in each case in the
ordinary course of business;
(4) dispositions or a series of related dispositions of property for
net proceeds which, when taken collectively with the net proceeds of any
other such dispositions under this clause (4) that were consummated since
the beginning of the calendar year in which such disposition is
consummated, are less than $1.0 million;
(5) transactions permitted under Section 5.01 hereof;
(6) the making of a Permitted Investment or any other transaction
permitted by Section 4.10 hereof;
(7) licenses or similar agreements with respect to intellectual
property or other general intangibles owned or licensed by HoldCo 3 or any
of its Restricted Subsidiaries in the ordinary course of business;
(8) any transaction that constitutes a Change of Control;
(9) a disposition of Cash Equivalents in the ordinary course of
business;
(10) pro rata dispositions of property to joint venture partners in
connection with the dissolution or other termination of a joint venture;
(11) a transfer resulting from a casualty or condemnation of assets;
and
(12) the trade or exchange by HoldCo 3 or any Restricted
Subsidiaries of any assets used or useful in HoldCo 3's business or any
Related Business that are owned or held by HoldCo 3 or such Restricted
Subsidiary solely for assets used or useful in HoldCo 3's business or any
Related Business that are owned or held by another Person that the Board
of Directors of HoldCo 3 determines in good faith by Board Resolution to
be of approximately equivalent value; provided, however, that for any
trade or exchange or series of trades or exchanges involving value in
excess of $25.0 million HoldCo 3 must obtain a written opinion from an
Independent Financial Advisor to the effect that the assets received
constitutes an exchange of equivalent value.
"ATTRIBUTABLE DEBT" in respect of a Sale and Leaseback Transaction
under the Senior Notes Indenture means, at any date of determination;
(1) if such Sale and Leaseback Transaction is a Capitalized Lease
Obligation, the amount of Debt represented thereby according to the
definition of "Capitalized Lease Obligation;" and
(2) in all other instances the present value (discounted at the cash
interest rate borne by the Senior Notes, compounded semi-annually) of the
total obligations of the lessee for rental payments during the remaining
term of the lease included in such Sale and Leaseback Transaction
(including any period for which such lease has been extended).
"AVAILABLE CASH" means:
(1) readily available cash held by Intermediary Sub;
(2) readily available cash held by HoldCo 2;
(3) readily available cash held by HoldCo 3;
(4) readily available cash held by OpCo; and
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(5) any amount available to OpCo under the Revolving Credit Facility
(as that term is defined in the Senior Credit Facilities),
in the case of clauses (4) and (5), (x) that is available to pay cash dividends
or distributions to HoldCo 3 without violation of state surplus laws and the
terms of the OpCo Senior Indenture, the OpCo Subordinated Indenture and the
Senior Credit Facilities and (y) with respect to determining the amount of
Available Cash to make the interest payment on November 1, 2006, determined by
reference to the financial statements of OpCo for the period ended on the last
Sunday of August 2006.
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal,
state or foreign law for the relief of debtors.
"BENEFICIAL OWNERSHIP" and "BENEFICIAL OWNER" have the meanings such
terms are given in accordance with Rule 13d-3 promulgated by the Commission
under the Exchange Act.
"BOARD OF DIRECTORS" means:
(1) with respect to a corporation, the Board of Directors of the
corporation;
(2) with respect to a partnership, the Board of Directors or similar
board or committee or Person serving a similar function of the managing
general partner of the partnership; and
(3) with respect to any other Person, the board or committee of that
Person or any Person serving a similar function.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the applicable Person to have been duly
adopted by the Board of Directors of such Person and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"BUSINESS DAY" means any day other than a Legal Holiday.
"CAPITALIZED LEASE OBLIGATION" means, as to any Person, the
obligation of such Person to pay rent or other amounts under a lease to which
such Person is a party that is required to be classified and accounted for as a
capital lease obligation under GAAP, and for purposes of this definition, the
amount of such obligation at any date shall be the capitalized amount of such
obligation at such date, determined in accordance with GAAP.
"CAPITAL STOCK" means:
(1) with respect to any Person that is a corporation, any and all
shares of corporate stock of that Person;
(2) with respect to any Person that is an association or business
entity, any and all shares, interests, participations, rights or other
equivalents, however designated, of capital stock of that Person;
(3) with respect to any Person that is a partnership or limited
liability company, any and all partnership or membership interests,
whether general or limited, of that Person; and
(4) with respect to any other Person, any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of or distributions of assets of, the issuing Person.
"CASH" or "CASH" means such coin or currency of the United States as
at any time of payment is legal tender for the payment of public and private
debts.
"CASH EQUIVALENTS" means any of the following:
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(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 eurodollar time deposits, time deposit accounts,
certificates of deposit and money market deposits maturing within 360 days
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
having capital, surplus and undivided profits aggregating in excess of
$250 million and whose long-term debt, or whose parent holding company's
long-term debt, 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);
(3) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (1) above entered
into with a bank meeting the qualifications described in clause (2) above;
(4) Investments in commercial paper, maturing not more than 360 days
after the date of acquisition, issued by a corporation (other than an
Affiliate of HoldCo 3) 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 or "A-1" (or
higher) according to S&P;
(5) Investments in securities maturing not more than 360 days after
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 S&P or "A" by Xxxxx'x; and
(6) Investments in mutual funds whose investment guidelines restrict
substantially all of such funds' investments to those satisfying the
provisions of clauses (1) through (5) above.
"CHANGE OF CONTROL" means the occurrence of any of the following
events:
(1) any sale, lease, exchange or other transfer, in one transaction
or a series of related transactions, of all or substantially all of the
assets of SFC and its Subsidiaries taken as a whole to any Person or Group
(whether or not otherwise in compliance with the provisions of this
Indenture), other than to one or more of the Permitted Holders or their
Related Parties;
(2) any Person or Group, other than one or more of the Permitted
Holders or of their Related Parties, becomes the Beneficial Owner,
directly or indirectly, of securities constituting more than 50% of SFC's
Voting Stock;
(3) the approval by the holders of Capital Stock of SFC,
Intermediary Sub, HoldCo 2, HoldCo 3 or OpCo of any plan or proposal for
the liquidation or dissolution of SFC, Intermediary Sub, HoldCo 2, HoldCo
3 or OpCo, as the case may be (whether or not otherwise in compliance with
the provisions of this Indenture); or
(4) a majority of the Board of Directors of SFC or HoldCo 3 shall
consist of Persons who are not Continuing Directors.
"CHANGE OF CONTROL EFFECTIVE DATE" means the effective date of the
transaction constituting a Change of Control.
"CLEARSTREAM" means Clearstream Banking S.A. and any success
thereto.
"CLOSING PRICE" means on any Trading Day, the reported last sale
price per share of Common Stock (or if no last sale price is reported, the
average of the bid and ask prices per share or, if more than one in either case,
the average of the average bid and the average ask prices per share) on such
date reported by the NASDAQ National Market or, if the Common Stock is not
quoted on the NASDAQ National Market, as reported by the
4
principal national securities exchange on which the Common Stock is listed, or
if no such prices are available, the Closing Price per share shall be the fair
value of a share of Common Stock as reasonably determined by the Board of
Directors of SFC (which determination shall be conclusive and shall be evidenced
by an Officers' Certificate delivered by SFC to the Trustee).
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the Securities and Exchange Commission.
"COMMODITY AGREEMENT" means any commodity futures contract,
commodity option or similar agreement or arrangement designed to protect against
fluctuations in the price of commodities used at the time in the ordinary course
of business.
"COMMON STOCK" means the common stock of SFC, par value $0.01 per
share, as it exists on the date of this Indenture and any shares of any class or
classes of Capital Stock of SFC resulting from any reclassification or
reclassifications thereof, or, in the event of a merger, consolidation or other
similar transaction involving SFC that is otherwise permitted hereunder in which
SFC is not the surviving corporation, the common stock, common equity interests,
ordinary shares or depositary shares or other certificates representing common
equity interests of such surviving corporation or its direct or indirect parent
corporation, and which have no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding-up of SFC and which are not subject to redemption by SFC; provided,
however, that if at any time there shall be more than one such resulting class,
the shares of each such class then so issuable on conversion of Notes shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares of
all such classes resulting from all such reclassifications.
"CONAGRA FOODS" means ConAgra Foods, Inc., a Delaware corporation.
"CONSOLIDATED COVERAGE RATIO" means, with respect to any Person as
of any date of determination, the ratio of:
(1) Consolidated EBITDA for that Person for the period of the most
recent four consecutive fiscal quarters ending prior to the date of such
determination and as to which financial statements are available and have
been filed with the Commission and/or provided to the Trustee, to
(2) Consolidated Interest Expense for that Person for those four
fiscal quarters.
In the event that such Person or any of its Restricted Subsidiaries
Incurs, assumes, guarantees, repurchases, repays or redeems any Debt or issues
any Preferred Stock or Disqualified Capital Stock subsequent to the commencement
of the period for which the Consolidated Coverage Ratio is being calculated but
prior to the event for which the calculation of the Consolidated Coverage Ratio
is made (the "CALCULATION DATE"), then the Consolidated Coverage Ratio shall be
calculated giving pro forma effect to such Incurrence, assumption, guarantee,
repurchase, repayment or redemption of Debt or issuance of Preferred Stock or
Disqualified Capital Stock as if the same had occurred at the beginning of the
applicable four-quarter period. For purposes of making the computation referred
to above, Investments, acquisitions, dispositions, mergers, consolidations,
restructurings, joint ventures and discontinued operations that are made by such
Person or any of its Restricted Subsidiaries during the four-quarter reference
period or subsequent to such reference period and on or prior to or
simultaneously with the Calculation Date will be calculated on a pro forma basis
assuming that all such Investments, acquisitions, dispositions, mergers,
consolidations, restructurings, joint ventures and discontinued operations (and
the increase or reduction of any associated interest obligations and the change
in Consolidated EBITDA resulting therefrom) had occurred on the first day of the
four-quarter reference period.
If since the beginning of such period any Person (that subsequently
became a Restricted Subsidiary of or was merged with or into any Restricted
Subsidiary since the beginning of such period) shall have made any Investment,
acquisition, disposition, merger, consolidation, restructuring, joint venture or
discontinued operation that would have required adjustment pursuant to this
definition, then the Consolidated Coverage Ratio shall be calculated giving pro
forma effect thereto for such period as if such Investment, acquisition,
disposition,
5
merger, consolidation, restructuring, joint venture or discontinued operation
had occurred at the beginning of the applicable four-quarter period.
For purposes of this definition, whenever pro forma effect is to be
given to a transaction, the pro forma calculations shall be made in good faith
by a responsible financial or accounting officer of the Person. If any Debt
bears a floating rate of interest and is being given pro forma effect, the
interest on such Debt will be calculated as if the rate in effect on the
Calculation Date had been the applicable rate for the entire period (taking into
account any Hedging Obligations applicable to that Debt). To the extent that the
historical rate is not available, any pro forma calculation involving interest
on the Notes or the Senior Notes shall be deemed to be the interest rate
applicable to the immediately preceding Interest Payment Date with respect to
the Notes or the immediately preceding interest payment date with respect to the
Senior Notes, as applicable (which interest rate, if such immediately preceding
interest payment was paid partially in cash and partially in PIK Notes or Senior
PIK Notes, as applicable, shall be equal to the weighted average interest rate
paid taking into account the amount paid in cash and the amount paid in PIK
Notes or Senior PIK Notes, as applicable); provided, however, if for purposes of
the pro forma calculation, there is no preceding interest payment, then such
calculation shall be calculated using the cash interest rate. Interest on a
Capitalized Lease Obligation shall be deemed to accrue at an interest rate
reasonably determined by a responsible financial or accounting officer of the
Person to be the rate of interest implicit in such Capitalized Lease Obligation
in accordance with GAAP.
For purposes of making the computation referred to above, interest
on any Debt under a revolving credit facility or similar arrangement computed on
a pro forma basis shall be computed based on the average balance of such Debt
during the applicable period. Interest on Debt that may optionally be determined
at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rate, shall be deemed to have been
based upon the rate actually chosen, or, if none, then based upon such optional
rate chosen as the Person may designate.
"CONSOLIDATED CURRENT LIABILITIES" means, as of any date of
determination, the aggregate amount of liabilities of HoldCo 3 and its
consolidated Restricted Subsidiaries which may properly be classified as current
liabilities (including taxes accrued as estimated), after eliminating:
(1) all intercompany items between HoldCo 3 and any Restricted
Subsidiary or between Restricted Subsidiaries, and
(2) all short-term debt and all current maturities of long-term
Debt.
"CONSOLIDATED EBITDA" means, with respect to any Person for any
period, the Consolidated Net Income of the Person and its Restricted
Subsidiaries for that period plus, to the extent such amount was deducted in
calculating Consolidated Net Income and as determined in conformance with GAAP:
(1) Consolidated Interest Expense;
(2) income tax expense;
(3) depreciation expense;
(4) amortization expense;
(5) exchange or translation losses on foreign currencies;
(6) upfront expenses resulting from or charges relating to equity
offerings, investments, mergers, recapitalizations, option buyouts,
dispositions, acquisitions and similar transactions to the extent those
expenses reduce net income;
(7) restructuring charges or write-offs;
(8) gains or losses on dispositions;
6
(9) any costs or charges which would otherwise reduce Consolidated
EBITDA as a result of an increase in value to the pre-acquisition
historical amounts of accounts receivable, inventories or any other
current assets (the "WRITE-UP"), to the extent the write-up is required by
GAAP, and occurs as a result of any acquisition permitted under this
Indenture;
(10) the amount of any minority interest expense;
(11) without duplication, all other non-cash items (excluding any
charge which represents the accrual of, or a reserve for, anticipated cash
charges for any future period), extraordinary items and nonrecurring and
unusual items reducing such Consolidated Net Income; and
(12) any decrease in Consolidated Net Income resulting solely from
the marking to market of open positions on beef and pork contracts
required by the application of Statement of Financial Accounting Standards
No. 133, "Accounting for Derivative Instruments and Hedging Activities" of
the Financial Accounting Standards Board (and any replacement or successor
statement);
less all non-cash items (excluding items which represent the reversal of a
charge referred to in the parenthetical to clause (11) above) and nonrecurring
and unusual items increasing such Consolidated Net Income.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person
for any period, the sum, without duplication of:
(1) consolidated interest expense of that Person and its Restricted
Subsidiaries for that period, to the extent such expense was deducted in
computing Consolidated Net Income, including:
(a) amortization of debt discount;
(b) the interest component of Capitalized Lease Obligations;
(c) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing;
(d) interest actually paid by that Person or any of its
Restricted Subsidiaries under any guarantee of Debt or other
obligation of any other Person;
(e) net payments (whether positive or negative) pursuant to
Interest Rate Protection Agreements;
(f) 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
HoldCo 3) in connection with Debt Incurred by that plan or trust;
and
(g) cash and Disqualified Capital Stock dividends in respect
of all Preferred Stock of Restricted Subsidiaries and Disqualified
Capital Stock of HoldCo 3 held by Persons other than HoldCo 3 or a
Wholly Owned Subsidiary of Holdco 3; and
(2) consolidated capitalized interest of that Person and its
Restricted Subsidiaries for that period, whether paid or accrued; and
(3) interest expense paid or accrued on Debt Incurred by that Person
including, in the case of HoldCo 3, any interest paid or accrued on the
Notes in the form of cash or PIK Notes and any interest paid or accrued on
the Senior Notes in the form of cash or Senior PIK Notes,
less, to the extent included in the consolidated interest expense of that
Person, (A) non-cash interest on any Debt other than non-cash interest accrued
or paid on the Notes in the form of PIK Notes, non-cash interest accrued or paid
on the Senior Notes in the form of Senior PIK Notes and any other non-cash
interest accrued or paid as additional
7
Debt other than through the amortization of original issue discount (provided
that, in the case of Debt that amortizes original issue discount, such Debt does
not require any repayment of all or any portion of the principal amount thereof
prior to the final maturity of the Notes), (B) debt discount solely to the
extent relating to the issuance and sale of Debt together with any equity
security as part of an investment unit and (C) the amortization of capitalized
debt issuance costs.
Notwithstanding the foregoing, the Consolidated Interest Expense
with respect to any Restricted Subsidiary of the Person that was not a Wholly
Owned Subsidiary will be included only to the extent (and in the same
proportion) that the net income of such Restricted Subsidiary was included in
calculating Consolidated Net Income.
"CONSOLIDATED NET INCOME" means, with respect to any Person for any
period, (1) the net income (loss) of that Person and its consolidated Restricted
Subsidiaries, determined in accordance with GAAP and before any reduction in
respect of Preferred Stock dividends, less (2), in the case of HoldCo 3,
interest paid or accrued on the Senior Notes, including any interest paid in the
form of Senior PIK Notes (to the extent any such interest on the Senior Notes
was not deducted in determining Consolidated Net Income under clause (1)), and
interest paid or accrued on the Notes including any interest paid in the form of
PIK Notes; provided, however, that Consolidated Net Income for that Person for
that period will exclude, without duplication:
(1) any net income of any Restricted Subsidiary of the Person if and
to the extent that 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
that Person, other than restrictions in effect on the date the Notes are
first issued with respect to a Restricted Subsidiary of that Person and
other than restrictions that are either created or exist in compliance
with the provisions of Section 4.13 or are legally waived;
(2) any net after-tax gain or loss (including all fees and expenses
related thereto) realized upon the sale or other disposition of any assets
of the Person or its consolidated Restricted Subsidiaries, including
pursuant to any Sale and Leaseback Transaction, which are not sold or
otherwise disposed of in the ordinary course of business;
(3) any net after-tax extraordinary gain or loss (including all fees
and expenses related thereto);
(4) the cumulative effect of a change in accounting principles;
(5) any net after-tax income (loss) from discontinued operations and
any net after-tax gains or losses on disposal of discontinued operations;
(6) the net income of any Person, other than a Restricted
Subsidiary, except to the extent of the lesser of:
(a) dividends or distributions paid to HoldCo 3 or any of its
Restricted Subsidiaries by that Person; and
(b) the net income of that Person, but in no event less than
zero;
(7) any non-cash expenses attributable to grants or exercises of
employee or independent contractor stock options or equity compensation
arrangements; and
(8) any costs relating to the offering of the Notes or the Senior
Notes that would be required to be expensed under GAAP.
provided, further, however, that solely when determining Consolidated Net Income
for purposes of paragraph (a)(iii)(A) under Section 4.10, the following items
shall be added back to Consolidated Net Income to the extent such amount was
deducted in calculating Consolidated Net Income and as determined in accordance
with GAAP:
8
(a) extraordinary items and nonrecurring and unusual items;
(b) the xxxx-to-market impact of open positions accounted for
in accordance with Statement of Financial Accounting Standards No.
133, "Accounting for Derivative Instruments and Hedging Activities;"
and
(c) the amount of any non-cash items related to the
compensation of employees, officers, directors or consultants and
impairments of intangible assets.
"CONSOLIDATED NET TANGIBLE ASSETS" means, as of any date of
determination, the sum of the amounts that would appear on a consolidated
balance sheet of HoldCo 3 and its consolidated Restricted Subsidiaries as the
total assets (less accumulated depreciation and amortization, allowances for
doubtful receivables, other applicable reserves and other properly deductible
items) of HoldCo 3 and its Restricted Subsidiaries, after giving effect to
purchase accounting and after deducting therefrom Consolidated Current
Liabilities and, to the extent otherwise included, the amounts of (without
duplication):
(1) the excess of cost over fair market value of assets or
businesses acquired;
(2) any revaluation or other write-up in book value of assets
subsequent to the last day of the fiscal quarter of HoldCo 3 immediately
preceding the date the Notes are first issued as a result of a change in
the method of valuation in accordance with GAAP;
(3) unamortized debt discount and expenses and other unamortized
deferred charges, goodwill, patents, trademarks, service marks, trade
names, copyrights, licenses, organization or developmental expenses and
other intangible items;
(4) minority interests in consolidated Subsidiaries held by Persons
other than HoldCo 3 or any Restricted Subsidiary;
(5) treasury stock;
(6) cash or securities set aside and held in a sinking or other
analogous fund established for the purpose of redemption or other
retirement of Capital Stock to the extent such obligation is not reflected
in Consolidated Current Liabilities; and
(7) Investments in and assets of Unrestricted Subsidiaries.
"CONTINUING DIRECTORS" means, as of any date of determination, any
member of the Board of Directors of applicable Person who (a) was a member of
such Board of Directors on the date of this Indenture or (b) whose nomination or
election was approved by a vote of at least a majority of individuals who were
Continuing Directors as of the time of such nomination or election.
"CONTRIBUTION AGREEMENT" means the agreement by and among HoldCo 3,
Swift Foods Company, HoldCo 2 and OpCo, dated September 19, 2002, pursuant to
which Swift Foods Company, HoldCo 2 and HoldCo 3 and will contribute or
otherwise pay over, or cause any of their Subsidiaries (other than Swift Cattle
Holdco, Inc.) to contribute or otherwise pay over, to OpCo any amounts they
receive from ConAgra Foods or its Affiliates pursuant to indemnification claims
under the Acquisition Agreement and any amounts obtained from other sources
which are applied to offset any indemnification claims that OpCo could otherwise
make under the Acquisition Agreement.
"CONVERSION CONSIDERATION" means, with respect to any Note or
portion thereof to be converted, the amount determined in Section 14.13(a).
"CONVERSION PRICE" per share of Common Stock as of any day, shall be
the product of multiplying (A) the IPO Price and (B) if the IPO Effective Date
is (i) on or prior to March 11, 2006, 1.3; (ii) after March 11, 2006 but on or
prior to March 11, 2007, 1.25; (iii) after March 11, 2007 but on or prior to
March 11,
9
2008, 1.20; (iv) after March 11, 2008 but on or prior to March 11, 2009, 1.15
and (v) after March 11, 2009 but prior to the Final Maturity Date, 1.10.
"CONVERSION RATE" means the rate equal to the quotient of $1.00
divided by the Conversion Price.
"CONVERSION REFERENCE PERIOD" means the 20 consecutive Trading Days
beginning on the third Trading Day following the Conversion Date.
"CONVERSION VALUE" means, for each $1.00 principal amount of Notes,
an amount equal to the product of (i) the Conversion Rate in effect on the
Conversion Date and (ii) the average of the Closing Prices of the Common Stock
for each of the 20 consecutive Trading Days of the Conversion Reference Period,
appropriately adjusted to take into account the occurrence during the Conversion
Reference Period of stock splits and similar events.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the address of
the Trustee specified in Section 15.02 hereof or such other address as to which
the Trustee may give notice to SFC.
"CURRENCY PROTECTION AGREEMENT" means any currency protection
agreement entered into with one or more financial institutions in the ordinary
course of business that is designed to protect the person or entity entering
into the agreement against fluctuations in currency exchange rates with respect
to Debt Incurred and not for purposes of speculation.
"CUSTODIAN" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
Custodian with respect to the Notes, any and all successors thereto appointed as
custodian hereunder and having become such pursuant to the applicable provisions
of this Indenture.
"DAILY SHARE AMOUNT," for each $1.00 principal amount of Notes,
means, for each Trading Day of the Conversion Reference Period, a number of
shares of Common Stock determined in accordance with the following formula:
(CP * CR) - PA
-------------
CP * 20
Where
CP means the Closing Price on such Trading Day,
CR means the Conversion Rate in effect on the Conversion Date, and
PA means the $1.00 principal amount per Note.
"DEBT" means, with respect to any Person on any date of
determination, without duplication, any indebtedness of that Person:
(1) for borrowed money;
(2) evidenced by bonds, debentures, notes or other similar
instruments;
(3) constituting Capitalized Lease Obligations and all Attributable
Debt in respect of Sale and Leaseback Transactions;
(4) Incurred or assumed as the deferred and unpaid purchase price of
property or services, or pursuant to conditional sale obligations and
title retention agreements (but excluding trade accounts payable and
accrued expenses arising in the ordinary course of business), which
purchase price is due more than six months after the date of placing such
property in service or taking delivery and title thereto or the completion
of such services;
10
(5) for reimbursement of any obligor on any letter of credit,
banker's acceptance or similar credit transaction;
(6) for Debt of other Persons to the extent guaranteed by such
Person;
(7) for Hedging Obligations; and
(8) for Debt of any other Person of the type referred to in clauses
(1) through (7) which is secured by any Lien on any property or asset of
such first referred to Person, the amount of such Debt being deemed to be
the lesser of the value of the property or asset underlying the Lien or
the amount of the Debt so secured.
The amount of Debt of any Person at any date will be:
(a) the sum of (I) the outstanding principal amount of all
unconditional obligations described above, as such amount would be
reflected on a balance sheet prepared in accordance with GAAP and
(II) the maximum liability, upon the occurrence of the contingency
giving rise to the obligation, of any contingent obligations at such
date; and
(b) the accreted value of that Debt, in the case of any Debt
issued with original issue discount.
"DEFAULT" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"DEFINITIVE NOTE" means a certificated Note registered in the name
of the Holder thereof and issued in accordance with Section 2.06 hereof, in
substantially the form of Exhibit A hereto except that such Note shall not bear
the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"DEPOSITARY" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provisions of this Indenture.
"DESIGNATED PREFERRED STOCK" means Preferred Stock of a Person,
other than Preferred Stock that is Disqualified Capital Stock, that is issued to
another Person other than to a Restricted Subsidiary, for cash and is so
designated as "Designated Preferred Stock," pursuant to an Officers' Certificate
executed by the principal executive officer and the principal financial officer
of the Person, on the issuance date of that Preferred Stock, the cash proceeds
of which are excluded from the calculation set forth in clause (a)(iii)(B) of
Section 4.10.
"DESIGNATED SENIOR DEBT" means:
(1) any Senior Debt that has, at the time of determination, an
aggregate principal amount outstanding of at least $25.0 million
(including the amount of all undrawn commitments and matured and
contingent reimbursement obligations pursuant to letters of credit
thereunder) that is specifically designated in the instrument evidencing
such Senior Debt and in an Officers' Certificate delivered to the Trustee
as "Designated Senior Debt" of HoldCo 3 for purposes of this Indenture;
(2) any Senior Debt outstanding under the Senior Notes Indenture.
"DISPOSITION" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the Surviving Person) or the sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of such
Person's assets or Capital Stock.
11
"DISQUALIFIED CAPITAL STOCK" means any Capital Stock that, by its
terms or by the terms of any security into which it is convertible or for which
it is exchangeable, or upon the happening of any event,
(1) matures (excluding any maturity as the result of an optional
redemption by the issuer of that Capital Stock);
(2) is mandatorily redeemable, pursuant to a sinking fund obligation
or otherwise; or
(3) is redeemable at the sole option of its holder,
in whole or in part, on or prior to the final maturity date of the Notes;
provided, however, that only the portion of Capital Stock that so matures or is
mandatorily redeemable or is so redeemable at the sole option of its holder
prior to the final maturity date of the Notes will be deemed Disqualified
Capital Stock.
"DISTRIBUTION COMPLIANCE PERIOD" means the 40-day distribution
compliance period as defined in Regulation S.
"DIVIDEND REFERENCE RATE" has the meaning set forth in Section
14.05(a)(v).
"DOMESTIC RESTRICTED SUBSIDIARY" means a Restricted Subsidiary
incorporated or otherwise organized or existing under the laws of the United
States, any state thereof or any territory or possession of the United States.
"EQUITY INTERESTS" means Qualified Capital Stock and all warrants,
options or other rights to acquire Qualified Capital Stock, but excluding any
debt security that is convertible into, or exchangeable for, Qualified Capital
Stock.
"EQUITY OFFERING" means any public or private sale of common stock
or Preferred Stock or options, warrants or rights with respect to such common
stock or Preferred Stock of HoldCo 3 or the Parent, excluding Disqualified
Capital Stock of HoldCo 3 and public offerings with respect to common stock
registered on Form S-8 or any successor form thereto under the Securities Act.
"EUROCLEAR" means Euroclear Bank, S.A./N.V., as operator of the
Euroclear systems, and any successor thereto.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXCLUDED PROCEEDS" means the net cash proceeds received by a Person
from
(1) contributions to its equity capital other than contributions
from the issuance of Disqualified Capital Stock of HoldCo 3 or any of its
Subsidiaries; and
(2) the sale, other than to a Subsidiary or to any management equity
or stock option plan or employee benefit plan of HoldCo 3, of Qualified
Capital Stock of the Person;
in each case designated as Excluded Proceeds pursuant to an Officers'
Certificate delivered by HoldCo 3 on the date the contributions are made or the
date those Equity Interests are sold, as the case may be, the cash proceeds of
which are excluded from the calculation set forth in clause (a)(iii)(B) of
Section 4.10.
"FINAL MATURITY DATE" means March 11, 2010.
"FISCAL YEAR" or "FISCAL YEAR" with respect to SFC means a calendar
year ending on the last Sunday in May.
12
"FOREIGN RESTRICTED SUBSIDIARY" means any Restricted Subsidiary
which is not organized under the laws of the United States of America or any
State thereof or the District of Columbia.
"FOREIGN SUBSIDIARY" means any Subsidiary which is not organized
under the laws of the United States of America or any State thereof or the
District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America, including those set forth in the opinions and pronouncements
of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or the Commission or in such other statements by such other
entity as approved by a significant segment of the accounting profession as may
from time to time be in effect. All ratios and computations based on GAAP
contained in this Indenture will be computed in conformity with GAAP.
"GLOBAL NOTE LEGEND" means the legend set forth in Section
2.06(f)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"GLOBAL NOTES" means the global Notes in the form of Exhibit A
hereto issued in accordance with Article 2 hereof.
"GROUP" means a group of related Persons for purposes of Section
13(d) of the Exchange Act.
"GUARANTEE" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof), of all or any part of any Debt. The term "guarantee" used as a
verb has a corresponding meaning.
"GUARANTEE" means a Guarantor's guarantee of the Notes, subject to
the provisions of Article 12 hereof.
"GUARANTOR" means: (1) HoldCo 3, (2) each of HoldCo 3's Restricted
Subsidiaries that in the future executes a supplemental indenture in which such
Restricted Subsidiary agrees to be bound by the terms of this Indenture as a
HoldCo 3 Subsidiary Guarantor, and (3) each of SFC's Subsidiaries that in the
future executes a supplemental indenture in which such Subsidiary agrees to be
bound by the terms of this Indenture as an SFC Subsidiary Guarantor; provided
that any Person constituting a Guarantor as described above shall cease to
constitute a Guarantor when its respective Guarantee is released in accordance
with the terms of this Indenture.
"HEDGING OBLIGATIONS" means, with respect to any specified entity,
the obligations of that entity under:
(1) any Interest Rate Protection Agreement;
(2) foreign exchange contracts and Currency Protection Agreements;
(3) any Commodity Agreement; and
(4) other agreements or arrangements entered into in the ordinary
course of business and designed to protect that entity against
fluctuations in interest rates, currency Conversion Rates or commodity
prices.
"XXXXX MUSE" means Hicks, Muse, Xxxx & Xxxxx Incorporated and each
of its successors.
"HOLDCO 2" means S&C Holdco 2, Inc., a Delaware corporation, and any
successors.
"HOLDCO 3" means the corporation named as "HoldCo 3" in the first
paragraph of this Indenture, and subject to the provisions of Article 5 and
Article 10, shall include its successors and assigns.
13
"HOLDCO 3 SUBSIDIARY GUARANTOR" means any Restricted Subsidiary that
becomes a Guarantor of the Notes pursuant to Section 4.26.
"HOLDER" means a Person in whose name a Note is registered.
"IAI GLOBAL NOTE" means a Global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold to Institutional Accredited Investors, if any.
"INCUR" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by merger, conversion, exchange or otherwise),
extend, assume, guarantee or become liable in respect of such Debt or other
obligation or the recording, as required pursuant to GAAP or otherwise, of any
such Debt or obligation on the balance sheet of such Person (and "INCURRENCE"
and "INCURRED" shall have meanings correlative to the foregoing); provided,
however, that a change in GAAP that results in an obligation of such Person that
exists at such time, and is not theretofore classified as Debt, becoming Debt
shall not be deemed an Incurrence of such Debt; provided further, however, that
any Debt or other obligations of a Person existing at the time such Person
becomes a Subsidiary (whether by merger, consolidation, acquisition or
otherwise) shall be deemed to be Incurred by such Subsidiary at the time it
becomes a Subsidiary.
"INDENTURE" means this instrument, as originally executed or as it
may from time to time be supplemented or amended in accordance with Article 9
hereof.
"INDEPENDENT FINANCIAL ADVISOR" means an accounting, appraisal,
investment banking firm or consultant to Persons engaged in OpCo's business of
nationally recognized standing that is, in the judgment of HoldCo 3's Board of
Directors, qualified to perform the task for which it has been engaged.
"INDIRECT PARTICIPANT" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"INITIAL NOTES" means $75,000,000 aggregate principal amount of
Notes issued under this Indenture on the date hereof.
"INITIAL PUBLIC OFFERING" means the first firm commitment
underwritten offering of Common Stock by SFC which is registered under the
Securities Act and following which the Common Stock of SFC is traded on a U.S.
national securities exchange or quoted on the NASDAQ National Market.
"INITIAL SENIOR NOTES" means $105,000,000 aggregate principal amount
of Senior Notes issued under the Senior Notes Indenture on the date hereof.
"INTERMEDIARY SUB" means SFC Subsidiary Holdings, Inc., a Delaware
corporation, and its successors.
"INTEREST PAYMENT DATES" shall have the meaning set forth in Section
4.01(a).
"INTEREST RATE PROTECTION AGREEMENT" means, with respect to any
Person, any interest rate protection agreement, interest rate future agreement,
interest rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which that Person is a party or
beneficiary.
"INTEREST RESTRICTED PERIOD" means the period commencing on the date
the Notes are first issued and ending on the earlier of (i) November 1, 2006 and
(ii) the IPO Effective Date.
14
"INVESTMENT" in any Person means any direct or indirect advance,
loan (other than advances to customers in the ordinary course of business) or
other extension of credit (including by way of guarantee or similar arrangement,
but excluding any debt or extension of credit represented by a bank deposit
other than a time deposit) or capital contribution to (by means of any transfer
of cash or other property to other Persons or any payment for property or
services for the account or use of other Persons), or any purchase or
acquisition of Capital Stock, Debt or other similar instruments issued by such
Person.
"IPO EFFECTIVE DATE" means the first closing date on which SFC
issues shares of Common Stock to the underwriters of the Initial Public
Offering.
"IPO PRICE" means the per share public offering price of the Common
Stock specified in the prospectus distributed to investors in the Initial Public
Offering.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York, the city in which the Corporate Trust
Office of the Trustee is located, or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"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).
"MARKET PRICE" means, with respect to any conversion of Notes, the
average of the Closing Prices of the Common Stock for the 20 consecutive Trading
Days comprising the Conversion Reference Period, appropriately adjusted to take
into account the occurrence during the applicable 20 Trading Day period of stock
splits and similar events.
"MOODY'S" means Xxxxx'x Investor Service, Inc. or any successor to
the rating agency business of Xxxxx'x Investors Service, Inc.
"NET AVAILABLE CASH" from an Asset Sale means cash or Cash
Equivalents received, including any payments received by way of deferred payment
of principal pursuant to a note or installment receivable or otherwise, but only
as and when received, but excluding any other consideration received in the form
of assumption by the acquiring Person of Debt or other obligations relating to
the properties or assets subject to that Asset Sale, from that Asset Sale, in
each case net of
(1) all legal, accounting, investment banking, title and recording
tax expenses, commissions and other fees and expenses incurred, and all
U.S. federal, state, foreign and local taxes required to be paid or
accrued as a liability under GAAP in connection with such Asset Sale;
(2) all payments made on any Debt which is secured by any assets
subject to such Asset Sale, other than the Senior Credit Facilities, in
accordance with the terms of any Lien upon such assets, or which must by
its terms, or in order to obtain a necessary consent to the Asset Sale, or
by applicable law, be repaid out of the proceeds from the Asset Sale;
(3) all distributions and other payments required to be made to any
Person owning a beneficial interest in assets subject to sale or minority
interest holders in Subsidiaries or joint ventures as a result of the
Asset Sale;
(4) the deduction of appropriate amounts to be provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the assets disposed of in the Asset Sale and retained by
HoldCo 3 or any Restricted Subsidiary of HoldCo 3 after that Asset Sale;
and
(5) any portion of the purchase price from an Asset Sale placed in
escrow, whether as a reserve for adjustment of the purchase price, for
satisfaction of indemnities in respect of such Asset Sale or otherwise in
connection with that Asset Sale; provided, however, that upon the
termination of that escrow,
15
Net Available Cash will be increased by any portion of funds in the escrow
that are released to HoldCo 3 or any Restricted Subsidiary.
"NET IPO PROCEEDS" means the Net Offering Proceeds from the Initial
Public Offering.
"NET OFFERING PROCEEDS" means the proceeds paid to SFC upon the
issuance of its Common Stock upon the completion of an underwritten public
offering of its Common Stock, less (to the extent not deducted from the proceeds
paid to SFC) all expenses paid or payable by SFC or any Subsidiary of SFC in
connection with such issuance and offering including, without limitation,
underwriters' fees, discounts and expenses, blue sky fees and expenses, listing
fees and expenses, legal and accounting fees and expenses, roadshow costs and
printing costs.
"NOTES" means the Initial Notes, the PIK Notes and any Notes issued
pursuant to Section 2.06, Section 2.07, Section 2.10, Section 3.06, Section
3.09, Section 4.22, Section 9.06 and Section 14.02(d).
"OBLIGATIONS" means all obligations for principal, premium,
interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Debt.
"OFFICER" means the Chief Executive Officer, the President, the
Chief Financial Officer or any Executive Vice President of SFC or HoldCo 3, as
the case may be.
"OFFICERS' CERTIFICATE" means a certificate, in form and substance
reasonably satisfactory to the Trustee, signed by two Officers of SFC or HoldCo
3, as the case may be, at least one of whom shall be the principal executive
officer or principal financial officer of SFC or HoldCo 3, as the case may be,
and delivered to the Trustee.
"OPCO" means Swift & Company, a Delaware corporation, and its
successors.
"OPCO SENIOR NOTES" means the notes issued by OpCo pursuant to the
OpCo Senior Indenture.
"OPCO SENIOR INDENTURE" means:
(1) the Indenture, dated as of September 19, 2002, by and among
OpCo, the guarantors listed on the signature pages thereto, and The Bank
of New York Trust Company of Florida, N.A., as trustee, as the same may be
amended, supplemented or otherwise modified from time to time, including
amendments, supplements or modifications relating to the addition or
elimination of Affiliates of OpCo as borrowers, guarantors or other credit
parties thereunder; and
(2) the indenture or other agreement evidencing any renewal,
extension, refunding, restructuring, replacement or refinancing thereof
(whether with the original trustee and holders or another trustee or one
or more other holders and whether provided under the original OpCo Senior
Indenture or one or more other credit or other agreements or indentures).
"OPCO SUBORDINATED NOTES" means the notes issued by OpCo pursuant to
the OpCo Subordinated Indenture.
"OPCO SUBORDINATED INDENTURE" means:
(1) the Indenture, dated as of September 19, 2002, by and among
OpCo, the guarantors listed on the signature pages thereto, and The Bank
of New York Trust Company of Florida, N.A., as trustee, as the same may be
amended, supplemented or otherwise modified from time to time, including
amendments, supplements or modifications relating to the addition or
elimination of Affiliates of OpCo as borrowers, guarantors or other credit
parties thereunder; and
(2) the indenture or other agreement evidencing any renewal,
extension, refunding, restructuring, replacement or refinancing thereof
(whether with the original trustee and holders or another
16
trustee or one or more other holders and whether provided under the
original OpCo Subordinated Indenture or one or more other credit or other
agreements or indentures).
"OPINION OF COUNSEL" means a written opinion, in form and substance
reasonably satisfactory to the Trustee, from legal counsel who is acceptable to
the Trustee and which meets the requirements of Section 15.05 hereof. The
counsel may be an employee of or counsel to SFC, HoldCo 3 or the Trustee.
"PARENT" means SFC and any Subsidiary of SFC of which Holdco 3 is a
direct or indirect Subsidiary.
"PARTICIPANT" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to The Depository Trust Company,
shall include Euroclear and Clearstream.
"PERMITTED DEBT" means, without duplication:
(1) Debt outstanding on the date the Notes are first issued;
(2) Debt of HoldCo 3 or a Restricted Subsidiary under the Senior
Credit Facilities, including guarantees thereof; provided that the
aggregate principal amount of all such Debt under the Senior Credit
Facilities at any one time outstanding shall not exceed the greater of (a)
$550.0 million, or (b) the sum of (I) 85% of the book value of the
accounts receivable of OpCo and its Restricted Subsidiaries, plus (II) 70%
of the book value of the inventory (other than supplies) of OpCo and its
Restricted Subsidiaries, (III) 15% of the book value of the supplies of
OpCo and its Restricted Subsidiaries, plus (IV) 100% of the book value of
the plant, property and equipment of OpCo and its Restricted Subsidiaries
(provided that any amount under this clause (IV) shall not exceed $110.0
million), in each case determined on a consolidated basis and to the
extent eligible to be included in the Borrowing Base (as defined in the
Senior Credit Facilities); less the amount of all repayments of term Debt
with Net Available Cash from Asset Sales applied pursuant to Section 4.12;
(3) Debt of HoldCo 3 owing to and held by any Wholly Owned
Restricted Subsidiary or Debt of a Restricted Subsidiary owing to and held
by HoldCo 3 or any Wholly Owned Restricted Subsidiary; provided, however,
that any Debt of HoldCo 3 (other than guarantees by HoldCo 3 of Debt under
the Senior Credit Facilities, the OpCo Senior Indenture and the OpCo
Subordinated Indenture) owing to and held by any Wholly Owned Restricted
Subsidiary that is not a Guarantor is unsecured and is subordinated in
right of payment to the payment and performance of HoldCo 3's obligations
under the Notes; provided, further, however, that any subsequent issuance
or transfer of any Capital Stock or any other event which results in any
such Wholly Owned Restricted Subsidiary ceasing to be a Wholly Owned
Restricted Subsidiary or any subsequent transfer of any such Debt, except
to HoldCo 3 or a Wholly Owned Restricted Subsidiary, will be deemed, in
each case, to constitute the Incurrence of that Debt by the issuer
thereof;
(4) Debt evidenced by or arising under the Notes, the Guarantees and
this Indenture, the Senior Notes, the Senior Guarantees and the Senior
Notes Indenture;
(5) Hedging Obligations; provided, however, that the agreements
governing those Hedging Obligations are entered into for bona fide hedging
purposes and not for speculative purposes, as determined in good faith by
the Board of Directors or senior management of HoldCo 3;
(6) additional Debt of HoldCo 3 or any of its Restricted
Subsidiaries not otherwise permitted under Section 4.09, in an aggregate
principal amount, which when aggregated with the aggregate principal
amount of all other Debt then outstanding and Incurred pursuant to this
clause (6), does not at any one time outstanding exceed $40.0 million
(which amount may, but need not, be incurred under the Senior Credit
Facilities);
(7) Refinancing Debt;
17
(8) subject to compliance with Section 4.26, guarantees by HoldCo 3
or Restricted Subsidiaries of HoldCo 3 of any Debt permitted by this
Indenture to be Incurred;
(9) Debt in respect of performance bonds, reimbursement obligations
with respect to letters of credit, bankers' acceptances, completion
guarantees and surety or appeal bonds provided by HoldCo 3 or any of its
Restricted Subsidiaries in the ordinary course of their business or Debt
with respect to reimbursement type obligations regarding workers'
compensation claims;
(10) pledges, deposits or payments made or given in the ordinary
course of business in connection with or to secure statutory, regulatory
or similar obligations, including obligations under health, safety or
environmental obligations, or arising from guarantees to suppliers,
lessors, licensees, contractors, franchisees or customers of obligations,
other than Debt, made in the ordinary course of business;
(11) Debt arising from agreements providing for indemnification,
adjustment of purchase price or similar obligations, or from guarantees or
letters of credit, surety bonds or performance bonds securing any
obligations of HoldCo 3 or any of its Restricted Subsidiaries pursuant to
those agreements, in each case Incurred in connection with the disposition
of any business assets or Restricted Subsidiaries of HoldCo 3, other than
guarantees of Debt or other obligations Incurred by any Person acquiring
all or any portion of those business assets or Restricted Subsidiaries of
HoldCo 3 for the purpose of financing that acquisition, in a principal
amount not to exceed the gross proceeds, including non-cash proceeds,
actually received by HoldCo 3 or any of its Restricted Subsidiaries in
connection with that disposition; provided, however, that such Debt is not
reflected on the balance sheet of HoldCo 3 or any of its Restricted
Subsidiaries, other than as contingent obligations referred to in a
footnote to financial statements and not otherwise reflected on the
balance sheet;
(12) Debt, including but not limited to Capitalized Lease
Obligations, mortgage financings or purchase money obligations, Incurred
for the purpose of financing all or any part of the purchase price or cost
of construction or improvement of property or assets, whether through
direct purchase of assets or the Capital Stock of any Person owning those
assets, or Incurred to refinance any such purchase price or cost of
construction or improvement in an aggregate amount not to exceed at any
one time outstanding $25.0 million;
(13) Acquired Debt or Disqualified Capital Stock of Persons that are
acquired by HoldCo 3 or any of its Restricted Subsidiaries or merged into
a Restricted Subsidiary in accordance with the terms of this Indenture;
provided, however, that such Acquired Debt or Disqualified Capital Stock
is not Incurred in contemplation of that acquisition or merger; and
provided, further, that after giving effect to the acquisition or merger,
HoldCo 3 would be permitted to Incur at least $1.00 of additional Debt,
other than Permitted Debt, under paragraph (a) of Section 4.09 without
giving effect to the last sentence thereof; and
(14) Debt arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument drawn inadvertently
against insufficient funds in the ordinary course of business, provided
that such Debt is extinguished within five business days of incurrence of
such Debt.
"PERMITTED DIVIDEND" means the dividend or distribution, directly or
indirectly and from time to time, to the holders of the Common Stock of an
amount equal to the gross proceeds from the offering of the Senior Notes.
"PERMITTED HOLDERS" means Xxxxx Muse, its Affiliates and each of
their respective principals, employees, partners, officers, members and
directors.
"PERMITTED INVESTMENT" means an Investment by HoldCo 3 or any of its
Restricted Subsidiaries in:
(1) cash or Cash Equivalents;
(2) an Investment existing on the date the Notes are first issued;
18
(3) receivables owing to HoldCo 3 or any of its Restricted
Subsidiaries, if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms,
including any receivables from livestock suppliers;
(4) payroll, travel 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;
(5) loans and advances to employees or independent contractors made
in the ordinary course of business in an aggregate amount outstanding at
any one time not to exceed $1.0 million;
(6) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to HoldCo 3 or any of
its Restricted Subsidiaries or in satisfaction of judgments or claims or
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of a debtor;
(7) Hedging Obligations permitted under clause (5) of the definition
of "Permitted Debt;"
(8) other Investments by HoldCo 3 or any of its Restricted
Subsidiaries, together with all other Investments made pursuant to this
clause (8), in an aggregate amount at any time outstanding not to exceed
$75.0 million; provided that the value of any such Investment shall be
determined at the time such Investment was made;
(9) Persons to the extent such Investment is received by HoldCo 3 or
any Restricted Subsidiary as non-cash consideration for Asset Sales
effected in compliance with Section 4.12;
(10) prepayments and other credits to suppliers made in the ordinary
course of business;
(11) Investments in connection with pledges, deposits, payments or
performance bonds made or given in the ordinary course of business in
connection with or to secure statutory, regulatory or similar obligations,
including obligations under health, safety or environmental obligations;
(12) any transaction to the extent it constitutes an Investment that
is permitted by and made in accordance with the provisions of the second
paragraph of Section 4.14;
(13) HoldCo 3 or a Wholly Owned Restricted Subsidiary; provided,
however, that the primary business of such Wholly Owned Restricted
Subsidiary or of its Wholly Owned Restricted Subsidiaries, as the case may
be, is a Related Business; and
(14) another Person if as a result of such Investment such other
Person becomes a Wholly Owned Restricted Subsidiary or is merged or
consolidated with or into, or transfers or conveys all or substantially
all its assets to, HoldCo 3 or a Wholly Owned Restricted Subsidiary;
provided, however, that in each case such Person's primary business is a
Related Business.
"PERMITTED JUNIOR SECURITIES" means:
(1) Capital Stock in SFC or any Subsidiary Guarantor of the Notes;
or
(2) debt securities that are subordinated to all Senior Debt to
substantially the same extent as, or to a greater extent than, the Notes
and the Subsidiary Guarantees are subordinated to Senior Debt under this
Indenture and have a Stated Maturity after (and do not provide for
scheduled principal payments prior to) the Stated Maturity of any Senior
Debt and any debt securities issued in exchange for Senior Debt;
provided, however, that, if such Capital Stock or debt securities are
distributed in a bankruptcy or insolvency proceeding, such Capital Stock or debt
securities are distributed pursuant to a plan of reorganization consented to by
each class of Designated Senior Debt.
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"PERMITTED LIENS" means:
(1) Liens to secure the Senior Credit Facilities;
(2) Liens on the outstanding Capital Stock or assets of Foreign
Subsidiaries to secure any intercompany notes issued by a Foreign
Subsidiary to HoldCo 3 or any Restricted Subsidiary and any guarantee of
such intercompany notes by a Foreign Subsidiary evidencing a loan by
HoldCo 3 or any Restricted Subsidiary to such Foreign Subsidiary of
proceeds from the Senior Credit Facilities;
(3) Liens to secure Debt permitted to be Incurred under clause (12)
of the definition of "Permitted Debt;" provided that any such Lien may not
extend to any property of HoldCo 3 or any Restricted Subsidiary, other
than the property acquired, constructed or leased with the proceeds of
such Debt and such Liens secure Debt in an amount not in excess of the
original purchase price or the original cost of any such property and any
improvements or accessions to such property;
(4) Liens for taxes, assessments or governmental charges or levies
on the property of HoldCo 3 or any Restricted Subsidiary if the same shall
not at the time be delinquent or thereafter can be paid without penalty,
or are being contested in good faith and by appropriate proceedings
promptly instituted and diligently concluded;
(5) Liens imposed by law, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens, on the property of HoldCo 3 or
any Restricted Subsidiary arising in the ordinary course of business and
securing payment of obligations that are not more than 60 days past due or
are being contested in good faith and by appropriate proceedings;
(6) Liens on the property of HoldCo 3 or any Restricted Subsidiary
Incurred in the ordinary course of business to secure performance of
obligations with respect to statutory or regulatory requirements,
performance or return-of-money bonds, surety bonds or other obligations of
a like nature and Incurred in a manner consistent with industry practice,
in each case which are not Incurred in connection with the borrowing of
money, the obtaining of advances or credit or the payment of the deferred
purchase price of property and which do not in the aggregate impair in any
material respect the use of property in the operation of the business of
HoldCo 3 and the Restricted Subsidiaries taken as a whole;
(7) Liens on property or assets of, or any shares of stock or
secured debt of, any Person at the time HoldCo 3 or any Restricted
Subsidiary acquired such property or the Person owning such property,
including any acquisition by means of a merger or consolidation with or
into HoldCo 3 or any Restricted Subsidiary; provided, however, that any
such Lien may not extend to any other property of HoldCo 3 or any
Restricted Subsidiary; provided, further, however, that such Liens shall
not have been Incurred in anticipation of or in connection with the
transaction or series of transactions pursuant to which such property was
acquired by HoldCo 3 or any Restricted Subsidiary;
(8) Liens on the property of a Person at the time such Person
becomes a Restricted Subsidiary; provided, however, that any such Lien may
not extend to any other property of HoldCo 3 or any other Restricted
Subsidiary that is not a direct Subsidiary of such Person; provided
further, however, that any such Lien was not Incurred in anticipation of
or in connection with the transaction or series of transactions pursuant
to which such Person became a Restricted Subsidiary;
(9) pledges or deposits by HoldCo 3 or any Restricted Subsidiary
under workmen's compensation laws, unemployment insurance laws or similar
legislation, or good faith deposits in connection with bids, tenders,
contracts (other than for the payment of Debt) or leases to which HoldCo 3
or any Restricted Subsidiary is party, or deposits to secure public or
statutory obligations of HoldCo 3, or deposits for the payment of rent, in
each case Incurred in the ordinary course of business;
(10) utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character;
20
(11) Liens securing Hedging Obligations;
(12) Liens existing on the date the Notes are first issued not
otherwise described in clauses (1) through (11) above;
(13) Liens on the property of HoldCo 3 or any Restricted Subsidiary
to secure any refinancing, refunding, extension, renewal or replacement,
in whole or in part, of any Debt secured by Liens referred to in clause
(3), (7), (8) or (12) above; provided, however, that any such Lien shall
be limited to all or part of the same property that secured the original
Lien (together with improvements and accessions to such property) and the
aggregate principal amount of Debt that is secured by such Lien shall not
be increased to an amount greater than the sum of:
(a) the outstanding principal amount, or, if greater, the
committed amount, of the Debt secured by Liens described under
clause (3), (7), (8) or (12) above, as the case may be, at the time
the original Lien became a Permitted Lien under this Indenture; and
(b) an amount necessary to pay any fees and expenses,
including premiums and defeasance costs, incurred by HoldCo 3 or
such Restricted Subsidiary in connection with such refinancing,
refunding, extension, renewal or replacement;
(14) Liens not otherwise permitted by clauses (1) through (13) above
encumbering assets having an aggregate fair market value not in excess of
5% of Consolidated Net Tangible Assets at the time of the incurrence of
such Lien; and
(15) subject to Section 4.11, a Lien securing Debt of a Restricted
Subsidiary incurred in accordance with Section 4.09;
provided, however, that "Permitted Lien" does not include any Lien on the
Capital Stock of OpCo other than Liens to secure Debt Incurred under the Senior
Credit Facilities.
"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.
"PIK NOTES" means any additional Notes issued or deemed issued
pursuant to Section 4.01 of this Indenture.
"PREDECESSOR NOTE" of any particular Note means every previous Note
evidencing all or a portion of the same Debt as that evidenced by such
particular Note; and for the purposes of this definition, any Note authenticated
and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Note
shall be deemed to evidence the same Debt as the lost, destroyed or stolen Note.
"PREFERRED STOCK" of any Person means any Capital Stock of that
Person that has preferential rights to any other Capital Stock of that Person
with respect to dividends or redemptions or upon liquidation.
"PRIVATE PLACEMENT LEGEND" means the legend set forth in Section
2.06(f)(i) hereof to be placed on all Notes issued under this Indenture except
as otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"QUALIFIED CAPITAL STOCK" means any Capital Stock that is not
Disqualified Capital Stock.
"QUALIFIED IPO" means the Initial Public Offering unless the Net IPO
Proceeds are less than $75 million, in which case, "Qualified IPO" means the
Initial Public Offering and all subsequent underwritten public offerings of
Common Stock until the aggregate Net Offering Proceeds from such underwritten
public offerings of Common Stock are at least equal to $75 million.
21
"QUALIFIED IPO EFFECTIVE DATE" means the IPO Effective Date unless
the Initial Public Offering is not a Qualified IPO, in which case "Qualified IPO
Effective Date" means the first closing date for the underwritten public
offering of Common Stock on which the aggregate Net Offering Proceeds from all
underwritten public offerings of Common Stock are at least equal to $75 million.
"REFINANCING DEBT" means any Debt that is Incurred by HoldCo 3 or
any Restricted Subsidiaries to refund, refinance, replace, renew, repay or
extend any Debt of HoldCo 3 or its Restricted Subsidiaries outstanding on the
date of this Indenture or any Debt Incurred in accordance with Section 4.09 that
does not:
(1) result in an increase in the aggregate principal amount of Debt
(such principal amount to include, for purposes of this definition only,
any premiums, fees, penalties or accrued interest paid with the proceeds
of the Refinancing Debt) of HoldCo 3 or that Restricted Subsidiary; or
(2) create Debt with:
(a) a Weighted Average Life to Maturity that is less than the
Weighted Average Life to Maturity of the Debt being refinanced; or
(b) a final maturity earlier than the final maturity of the
Debt being refinanced;
provided that in the event the primary obligor on the Debt being refunded,
refinanced, renewed, repaid or extended is HoldCo 3 or a HoldCo 3 Subsidiary
Guarantor, the Refinancing Debt may only be incurred by HoldCo 3 or such HoldCo
3 Subsidiary Guarantor, as the case may be.
"REGISTERED EXCHANGE OFFER" has the meaning set forth in the Senior
Registration Rights Agreement.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement dated as of the date hereof, among the SFC, HoldCo 3 and the initial
purchasers set forth therein, as such agreement may be amended, modified or
supplemented from time to time, relating to rights given by SFC to Holders to
register the resale of the Notes and the Common Stock into which they are
convertible under the Securities Act.
"REGULAR RECORD DATE" for the interest payable on any Interest
Payment Date means the date specified on the face of a Note.
"REGULATION S" means Regulation S promulgated under the Securities
Act.
"REGULATION S GLOBAL NOTE" means a Regulation S Temporary Global
Note or Regulation S Permanent Global Note, as appropriate.
"REGULATION S PERMANENT GLOBAL NOTE" means a permanent Global Note
in the form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with and registered in the name of the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Regulation S Temporary Global Note upon expiration of
the Distribution Compliance Period.
"REGULATION S TEMPORARY GLOBAL NOTE" means a temporary Global Note
in the form of Exhibit A hereto bearing the Global Note Legend, the Private
Placement Legend and Regulation S Temporary Global Note Legend and deposited
with and registered in the name of the Depository or its nominee, issued in a
denomination equal to the outstanding principal amount of the Notes initially
sold in reliance on Rule 903 of Regulation S.
"REGULATION S TEMPORARY GLOBAL NOTE LEGEND" means the legend set
forth in Section 2.06(f)(iii) hereof to be placed on all Regulation S Temporary
Global Notes issued under this Indenture.
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"RELATED BUSINESS" means any business which is the same as or
related, ancillary or complementary to any of the businesses of HoldCo 3 and its
Restricted Subsidiaries on the date the Notes are first issued, as reasonably
determined by HoldCo 3's Board of Directors.
"RELATED PARTIES" means any Person controlled by a Permitted Holder,
including any partnership of which a Permitted Holder or its Affiliates is the
general partner.
"REPRESENTATIVE" means the trustee, agent or representative
expressly authorized to act in such capacity, if any, for an issue of Senior
Debt.
"RESPONSIBLE OFFICER," when used with respect to the Trustee, means
any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.
"RESTRICTED DEFINITIVE NOTE" means one or more Definitive Notes
bearing the Private Placement Legend.
"RESTRICTED GLOBAL NOTES" means the 144A Global Note, the IAI Global
Note and the Regulation S Global Note.
"RESTRICTED INVESTMENT" means an Investment other than a Permitted
Investment.
"RESTRICTED PAYMENT" means:
(1) the declaration or payment of any dividend or the making of any
other distribution (other than dividends or distributions payable solely
in Qualified Capital Stock or in options, rights or warrants to acquire
Qualified Capital Stock) on shares of HoldCo 3's Capital Stock;
(2) the declaration or payment of any dividend or the making of any
other distribution on shares of the Capital Stock of a Restricted
Subsidiary to any Person (other than (a) to HoldCo 3 or any of its Wholly
Owned Restricted Subsidiaries, (b) dividends or distributions made by a
Restricted Subsidiary on a pro rata basis to all stockholders of such
Restricted Subsidiary (or owners of an equivalent interest in the case of
a Restricted Subsidiary that is not a corporation) or (c) dividends or
distributions payable solely in its Qualified Capital Stock or in options,
rights or warrants to acquire Qualified Capital Stock);
(3) the purchase, redemption, retirement or other acquisition for
value of any Capital Stock of HoldCo 3 held by Persons other than HoldCo 3
or a Restricted Subsidiary of HoldCo 3 or any Capital Stock of a
Restricted Subsidiary held by Persons other than HoldCo 3 or another
Restricted Subsidiary (in either case, other than in exchange for its
Qualified Capital Stock or options, rights or warrants to acquire
Qualified Capital Stock or to the extent that after giving effect to such
purchase, redemption, retirement or acquisition, such Restricted
Subsidiary would become a Wholly Owned Subsidiary);
(4) 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
Debt of HoldCo 3 or a Subsidiary Guarantor (other than the purchase,
repurchase or other acquisition of Subordinated Debt purchased (A) in
anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the
date of purchase, repurchase or acquisition or (B) in compliance with
Section 4.12 to the extent required by the indenture or other agreement or
instrument pursuant to which such Subordinated Debt was issued); or
(5) the making of any Investment (other than a Permitted Investment)
in any Person.
"RESTRICTED PERIOD" means the period commencing on the date of the
Notes are first issued and ending on the earlier of (i) September 11, 2006 and
(ii) the IPO Effective Date.
23
"RESTRICTED SUBSIDIARY" means any Subsidiary of HoldCo 3 other than
an Unrestricted Subsidiary.
"RULE 144" means Rule 144 promulgated under the Securities Act.
"RULE 144A" means Rule 144A promulgated under the Securities Act.
"RULE 144A AVAILABILITY NOTICE" means a written notice from SFC to
the Trustee stating that the information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act in connection with transfers of the
Notes in reliance on Rule 144A is available for distribution.
"RULE 903" means Rule 903 promulgated under the Securities Act.
"RULE 904" means Rule 904 promulgated under the Securities Act.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., or any successor to the rating agency business thereof.
"SALE AND LEASEBACK TRANSACTION" has the meaning set forth in the
Senior Note Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SELLER NOTE" means the note in the principal amount of $150.0
million issued by Swift Foods Company to ConAgra Foods, and assigned by Swift
Foods Company to HoldCo 2.
"SENIOR CREDIT FACILITIES" means the Debt represented by:
(1) the Credit Agreement, dated September 19, 2002, among HoldCo 3,
OpCo, certain of their Subsidiaries, the lenders party thereto, Citicorp
USA, Inc., as Administrative Agent, and XX Xxxxxx Xxxxx Bank, as
Syndication Agent, together with the related documents thereto (including,
without limitation, any guarantee agreements and security documents), as
amended and supplemented to and including the date hereof, and as the same
may be further amended, supplemented or otherwise modified from time to
time, including amendments, supplements or modifications relating to the
addition or elimination of Subsidiaries of HoldCo 3 as borrowers,
guarantors or other credit parties thereunder; and
(2) the agreements evidencing any renewal, extension, refunding,
restructuring, replacement or refinancing thereof (whether with the
original Administrative Agent and lenders or another administrative agent
or agents or one or more other lenders and whether provided under the
original Senior Credit Facilities or one or more other credit or other
agreements or indentures).
"SENIOR DEBT" of SFC means Debt, whether outstanding on the date the
Notes are first issued or thereafter Incurred, and shall include (i) all
obligations for interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to SFC whether or not such post-filing
interest is allowed in such proceeding and (ii) all fees, expenses and
indemnities and all other amounts payable with respect to Debt; provided,
however, that Senior Debt shall not include:
(1) any obligation in respect of the Notes or other Debt of SFC that
is by its terms subordinate or pari passu in right of payment to the
Notes;
(2) any Debt Incurred in violation of the provisions of this
Indenture;
(3) any obligation of SFC to any Subsidiary of SFC; or
(4) any obligations with respect to any Capital Stock of SFC.
24
To the extent that any payment of Senior Debt (whether by or on
behalf of SFC as proceeds of security or enforcement or any right of setoff or
otherwise) is declared to be fraudulent or preferential, set aside or required
to be paid to a trustee, receiver or other similar party under any Bankruptcy
Law, then if such payment is recovered by, or paid over to, such trustee,
receiver or other similar party, the Senior Debt or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred. "Senior Debt" of any Guarantor has a correlative
meaning and shall not include any obligation of such Guarantor to SFC or any
other Subsidiary of SFC.
"SENIOR EXCHANGE NOTES" means Senior Notes issued in the Registered
Exchange Offer pursuant to Section 2.06(f) of the Senior Notes Indenture.
"SENIOR GUARANTEE" means a Guarantor's guarantee of the Senior
Notes.
"SENIOR NOTES" means the Initial Senior Notes, the Senior Exchange
Notes, any Senior PIK Notes and any other notes issued or deemed issued under
the Senior Notes Indenture.
"SENIOR NOTES INDENTURE" means:
(1) the Indenture, dated as of the date hereof, by and among HoldCo
3, any guarantors and The Bank of New York Trust Company, N.A., as
Trustee, governing HoldCo 3's Senior Notes; and
(2) the indenture or other agreement evidencing any renewal,
extension, refunding, restructuring, replacement or refinancing thereof
(whether with the original trustee and holders or another trustee or one
or more other holders and whether provided under the original Senior Notes
Indenture or one or more other credit or other agreements or indentures).
"SENIOR PIK NOTES" means Senior Notes issued or deemed issued
pursuant to Section 4.01 of the Senior Notes Indenture.
"SENIOR REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement dated as of the date hereof, among HoldCo 3 and the initial purchasers
identified therein, as such agreement may be amended, modified or supplemented
from time to time, relating to rights given by HoldCo 3 to the purchasers of the
Notes to, among other things, exchange Senior Notes held prior to the Registered
Exchange Offer for Senior Exchange Notes.
"SENIOR SUBORDINATED DEBT" of SFC means the Notes and any other
subordinated Debt of SFC, whether outstanding on the date the Notes are first
issued or thereafter Incurred, that specifically provides that such Debt is to
rank pari passu with the Notes and is not subordinated by its terms to any other
subordinated Debt or other obligation of SFC which is not Senior Debt. "Senior
Subordinated Debt" of any Guarantor has a correlative meaning.
"SFC" means the corporation named as "SFC" in the first paragraph of
this Indenture, and, subject to the provisions of Article 5 and Article 10,
shall include its successors and assigns.
"SFC SUBSIDIARY GUARANTOR" means any direct or indirect parent of
HoldCo 3 that becomes a Guarantor of the Notes pursuant to Section 4.26.
"SHELF REGISTRATION STATEMENT" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"SIGNIFICANT SUBSIDIARY" means any Restricted Subsidiary that would
be a "significant subsidiary" of HoldCo 3 within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission.
"SPECIAL INTEREST" shall have the meaning set forth in the
Registration Rights Agreement.
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"STATED MATURITY" means, with respect to any installment of interest
or principal on any series of Debt (including, without limitation, a scheduled
repayment or a scheduled sinking fund payment), the date on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Debt, and will not include any contingent obligations to repay,
redeem or repurchase any such interest or principal prior to the date originally
scheduled for the payment hereof.
"SUBORDINATED DEBT" means any Debt of SFC, whether outstanding on
the date the Notes are first issued or thereafter Incurred, that specifically
provides that such Debt is to rank junior in right of payment to the Notes.
"Subordinated Debt" of any Guarantor has a correlative meaning.
"SUBSIDIARY," with respect to any Person, means (i) any corporation
of which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, through one or more
intermediaries, by such Person or (ii) any other Person of which at least a
majority of the voting interest under ordinary circumstances is at the time,
directly or indirectly, through one or more intermediaries, owned by such
Person. Notwithstanding anything in this Indenture to the contrary, all
references to HoldCo 3 and its consolidated Subsidiaries or to financial
information prepared on a consolidated basis in accordance with GAAP shall be
deemed to include HoldCo 3 and its Subsidiaries as to which financial statements
are prepared on a combined basis in accordance with GAAP and to financial
information prepared on such a combined basis. Notwithstanding anything in this
Indenture to the contrary, an Unrestricted Subsidiary shall not be deemed to be
a Restricted Subsidiary for purposes of this Indenture.
"SUBSIDIARY GUARANTEE" means the Guarantee of the Notes by each of
the Subsidiary Guarantors.
"SUBSIDIARY GUARANTOR" means each of HoldCo 3 Subsidiary Guarantor
and each SFC Subsidiary Guarantor.
"SURVIVING PERSON" means, with respect to any Person involved in or
that makes any Disposition, the Person formed by or surviving such Disposition
or the Person to which such Disposition is made.
"TAX SHARING AGREEMENT" means the agreement by and among OpCo, on
the one hand, and certain of its direct and indirect parent entities and the
entities that acquired and operated the domestic cattle feeding operations of
ConAgra Foods, on the other hand, as amended.
"TIA" means the Trust Indenture Act of 1939, as amended.
"TRADING DAY" means any day on which the NASDAQ National Market or,
if the Common Stock is not quoted on the NASDAQ National Market, the principal
national securities exchange on which the Common Stock is listed, is open for
trading or, if the Common Stock is not so listed, admitted for trading or
quoted, any Business Day. A Trading Day only includes those days that have a
scheduled closing time of 4:00 p.m. (New York City time) or the then standard
closing time for regular trading on the relevant exchange or trading system.
"TRANSACTION DOCUMENTS" means the Acquisition Agreement, together
with related documents, including the following documents:
(1) Preferred Supplier Agreement, dated September 19, 2002, between
ConAgra Foods and OpCo;
(2) By-Products Marketing Agreement, dated October 8, 2003 between
ConAgra Trade Group, Inc. and OpCo, as amended;
(3) By-Products Marketing Agreement, dated October 8, 2003, among
ConAgra Trade Group, Pty Ltd., ConAgra Trade Group Inc. and Australia Meat
Holdings Pty Limited, as amended;
(4) Seller Note;
26
(5) Monitoring and Oversight Agreement, dated September 19, 2002,
among Swift Foods Company, OpCo, Swift Pork Company, Swift Beef Company,
S&C Australia Holdco Pty. Ltd., Australia Meat Holdings Pty. Limited,
HoldCo 2, HoldCo 3 and Xxxxx Muse & Co. Partners, L.P., as amended;
(6) Financial Advisory Agreement, dated September 19, 2002 among
Swift Foods Company, OpCo, Swift Pork Company, Swift Beef Company, S&C
Australia Holdco Pty. Ltd., Australia Meat Holdings Pty. Limited, HoldCo
2, HoldCo 3 and Xxxxx Muse & Co. Partners, L.P., as amended;
(7) Stockholders' Agreement, dated September 19, 2002 among HMTF
Rawhide, L.P., ConAgra Foods, Hicks, Muse, Xxxx & Xxxxx Incorporated and
Swift Foods Company, as amended;
(8) the employment and severance arrangements with senior management
of OpCo;
(9) Indemnification and Release Agreement, dated September 19, 2002,
among ConAgra Foods, Swift Foods Company, Holdco 2, HoldCo 3, OpCo, S&C
Australia Holdco Pty. Ltd., Swift Cattle Holdco, Inc., Swift Brands
Company, Swift Beef Company, Swift Pork Company, Kabushiki Kaisha SAC
Japan, Swift Refrigerated Foods, S.A. de C.V., Xxxxxxx Finance Company,
Inc., Burcher Pty. Limited, Xxxxxxx, Inc., Australia Meat Holdings Pty.
Limited, Xxxxxx Bros. Co., Inc., Xxxxxxx Food Distribution Company and
Xxxxxxx International Sales Corporation;
(10) Contribution Agreement;
(11) Tax Sharing Agreement;
(12) Indemnity Side Letter dated September 3, 2002, from ConAgra
Foods and Swift Foods Company to HMTF Rawhide, L.P.;
(13) the lease for the Hyrum, Utah facilities from ConAgra Foods or
its Affiliates to HoldCo 3 or its Affiliates;
(14) intercompany promissory notes; and
(15) Patent License Agreement dated September 19, 2002, between
ConAgra Foods and Swift Brands Company;
and, in each case, the schedules, annexes and exhibits thereto and any
amendments thereto entered into after the date the Notes are first issued to the
extent that the terms, taken as a whole, of any such amendment are not otherwise
disadvantageous to the Holders of the Notes in any material respect.
"TREASURY YIELD" means, as of any redemption date, the yield to
maturity as of such redemption date of United States Treasury securities with a
constant maturity (as compiled by and published in the most recent Federal
Reserve Statistical Release H.15(519) that has become publicly available at
least two business days prior to the date fixed for redemption or, if such
statistical release is no longer published, any publicly available source of
similar market data) most nearly equal to the then remaining maturity of that
note. If the remaining maturity of such note is less than one year, the weekly
average yield on actually traded United States Treasury securities adjusted to a
constant maturity of one year will be used.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"UNRESTRICTED DEFINITIVE NOTES" means one or more Definitive Notes
that do not and are not required to bear the Private Placement Legend.
27
"UNRESTRICTED GLOBAL NOTES" means one or more Global Notes, in the
form of Exhibit A attached hereto, that do not and are not required to bear the
Private Placement Legend and are deposited with and registered in the name of
the Depositary or its nominee.
"UNRESTRICTED SUBSIDIARY" means any direct or indirect Subsidiary of
a Person that is designated by the Board of Directors of that Person as an
Unrestricted Subsidiary and any Subsidiary of that Unrestricted Subsidiary.
HoldCo 3 and any of its Restricted Subsidiaries will only be permitted to
provide credit support for Debt of an Unrestricted Subsidiary, including by way
of intercompany Debt, guarantee or otherwise, to the extent that HoldCo 3 is
permitted to Incur such Debt under Section 4.09 (without giving effect to the
last sentence thereof) and to make an Investment under Section 4.10 (without
giving effect to Section 4.10(c)(i) and, for purposes of this definition only,
applying the restrictions of Section 4.10(c)(ii) to the Company during the
Interest Restricted Period).
Any designation of a Subsidiary of HoldCo 3 as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution of the Board of Directors of HoldCo 3
giving effect to such designation and an Officers' Certificate of HoldCo 3
certifying that such designation complied with the preceding conditions and was
permitted by Section 4.10 hereof. If, at any time, any Unrestricted Subsidiary
would fail to meet the preceding requirements as an Unrestricted Subsidiary, it
will thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred
by a Restricted Subsidiary of HoldCo 3 as of such date and, if such Indebtedness
is not permitted to be incurred as of such date under Section 4.09 (without
giving effect to the last sentence thereof), HoldCo 3 will be in default of such
covenant. The Board of Directors of HoldCo 3 may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation will be deemed to be an incurrence of Indebtedness by one of HoldCo
3's Restricted Subsidiaries of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation will only be permitted if (1) such Indebtedness
is permitted under Section 4.09 (without giving effect to the last sentence
thereof), calculated on a pro forma basis as if such designation had occurred at
the beginning of the four-quarter reference period; and (2) no Default or Event
of Default would be in existence following such designation.
"U.S. GOVERNMENT SECURITIES" 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 or redeemable at the issuer's option.
"VOTING STOCK" of any Person as of any date means all classes of the
Capital Stock of that Person that is at the time entitled to vote in the
election of that Person's Board of Directors.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any Debt
at any date, the number of years obtained by dividing
(1) the then outstanding aggregate principal amount of such Debt
into
(2) the total of the product obtained by multiplying
(a) the amount of each then remaining installment, sinking
fund, serial maturity or other required payment of principal,
including payment at final maturity, in respect thereof; by
(b) the number of years (calculated to the nearest
one-twelfth) which will elapse between such date and the making of
such payment.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" means any Restricted Subsidiary
that is a Wholly Owned Subsidiary of HoldCo 3.
"WHOLLY OWNED SUBSIDIARY" means a Subsidiary of any Person, all of
the outstanding Capital Stock of which (other than any director's qualifying
shares or shares owned by foreign nationals to the extent mandated by applicable
law) is owned by such Person or one or more Wholly Owned Subsidiaries of such
Person.
28
"WHOLLY OWNED SUBSIDIARY GUARANTOR" means any HoldCo 3 Subsidiary
Guarantor that is a Wholly Owned Subsidiary of HoldCo 3.
SECTION 1.02. OTHER DEFINITIONS.
Term Defined in Section
"Acceleration Notice" Section 6.02
"Affiliate Transaction" Section 4.14
"Asset Sale Offer" Section 3.09(a)
"Authentication Order" Section 2.02
"Benefited Party" Section 10.01
"Cash Interest Dividend" Section 4.01(e)
"Change of Control Notice" Section 4.18(a)(i)
"Change of Control Offer" Section 4.18(a)
"Change of Control Payment Date" Section 4.18(a)(i)(B)
"Change of Control Purchase Price" Section 4.18(a)
"Change of Control Repurchase Notice" Section 4.18(b)
"Covenant Defeasance" Section 8.03
"Conversion Agent" Section 2.03
"Conversion Date" Section 14.02
"Current Market Price" Section 14.05(a)(vii)
"Deficiency" Section 4.01(b)
"Defeasance Trust" Section 8.04(a)
"Determination Date" Section 14.13(b)
"Distributed Securities" Section 14.05(a)(iv)
"DTC" Section 2.03
"Expiration Date" Section 14.05(a)(vi)
"Event of Default" Section 6.01
"Expiration Time" Section 14.05(a)(vi)
"Legal Defeasance" Section 8.02
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"Losses" Section 7.07
"Make Whole Premium" Section 14.14(a)
"Net Shares" Section 14.13(a)(ii)
"Net Share Amount" Section 14.13(a)(ii)
"Offer Amount" Section 3.09(b)
"Offer Period" Section 3.09(b)
"pay its Guarantee" Section 12.03
"pay the Notes" Section 11.03
"Paying Agent" Section 2.03
"Payment Blockage Notice" Section 11.03
"Payment Blockage Period" Section 11.03
"PIK Interest Portion" Section 4.01(b)
"PIK Note" Section 4.01(b)
"Principal Return" Section 14.13(a)(i)
"Purchase Date" Section 3.09
"Purchased Shares" Section 14.05(a)(vi)
"Registrar" Section 2.03
"Security Register" Section 4.18(a)(i)
"Spinoff Securities" Section 14.05(a)(iv)
"Stock Price" Section 14.14(c)
"Stock Price Percentage" Section 14.14(a)
"Third Party Purchaser" Section 14.13(e)
"Triggering Distribution" Section 14.05(a)(v)
"Triggering Determination Date" Section 14.05(a)(v)
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
(a) Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
(b) The following TIA terms used in this Indenture have the
following meanings:
30
"indenture securities" means the Notes;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the Notes means SFC, HoldCo 3, each other Guarantor and
any successor obligor upon the Notes.
(c) All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
under the TIA and not otherwise defined herein have the meanings so assigned to
them.
SECTION 1.04 RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined herein has the
meaning assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the
plural include the singular;
(v) all references in this instrument to designated
"Articles," "Sections" and other subdivisions are to the designated
Articles, Sections and subdivisions of this instrument as originally
executed;
(vi) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
(vii) "including" means "including without limitation;"
(viii) provisions apply to successive events and transactions;
and
(ix) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the Commission from time to time.
ARTICLE 2.
THE NOTES
SECTION 2.01. AUTHORIZATION, FORM AND DATING.
(a) General. The Notes are general obligations of SFC and will be
unsecured except to the extent provided in Section 4.11. The Notes that may be
issued hereunder shall be limited to the Initial Notes, the PIK Notes and any
Notes issued pursuant to Section 2.06, Section 2.07, Section 2.10, Section 3.06,
Section 3.09, Section 4.22, Section 9.06 and Section 14.02(d), all of which
shall constitute a single class of securities for purposes of this Indenture.
The Notes and the Trustee's certificate of authentication shall be substantially
in the form of Exhibit A hereto, which is hereby incorporated in and expressly
made part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage in addition to those
set forth on Exhibit A.
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Each Note shall be dated the date of its authentication. The Notes shall be in
denominations of $1.00 and integral multiples thereof. The terms and provisions
contained in the Notes shall constitute, and are hereby expressly made, a part
of this Indenture and SFC, HoldCo 3, any other Guarantors and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Form of Notes. The Initial Notes shall be issued as Definitive
Notes and, until delivery by SFC of the Rule 144A Availability Notice to the
Trustee, any other Note issued by SFC or issued upon exchange or transfer
pursuant to the terms hereof shall be issued as Definitive Notes. Notes issued
in global form shall be substantially in the form of Exhibit A attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued as Definitive
Notes shall be substantially in the form of Exhibit A attached hereto (but
without the Global Note Legend thereon and without the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Each Global Note shall
represent such of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions
and transfers of interests therein. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of the Regulation S Temporary
Global Note, which shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Clearstream, duly executed by SFC and authenticated by the Trustee
as hereinafter provided. The Distribution Compliance Period shall be terminated
upon the receipt by the Trustee of (i) a written certificate from the
Depositary, together with copies of certificates from Euroclear and Clearstream
certifying that they have received certification of non-United States Beneficial
Ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any Beneficial Owners thereof who
acquired an interest therein during the Distribution Compliance Period pursuant
to another exemption from registration under the Securities Act and who will
take delivery of a Beneficial Ownership interest in a Global Note, bearing a
Private Placement Legend, all as contemplated by Section 2.06(b)), and (ii) an
Officers' Certificate of SFC. Following the termination of the Distribution
Compliance Period, beneficial interests in the Regulation S Temporary Global
Note shall be exchanged for beneficial interests in the Regulation S Permanent
Global Note pursuant to the Applicable Procedures. Simultaneously with the
authentication of the Regulation S Permanent Global Note, the Trustee shall
cancel the Regulation S Temporary Global Note. The aggregate principal amount of
the Regulation S Temporary Global Note and the Regulation S Permanent Global
Notes may from time to time be increased or decreased by adjustments made on the
records of the Trustee and the Depositary or its nominee, as the case may be, in
connection with transfers of interests as hereinafter provided.
(d) Book-Entry Provisions. This Section 2.01(d) shall only apply to
Global Notes deposited with the Trustee, as custodian for the Depositary.
Participants and Indirect Participants shall have no rights under this Indenture
with respect to any Global Note held on their behalf by the Depositary or by the
Trustee as the custodian for the Depositary or under such Global Note, and the
Depositary shall be treated by SFC, the Trustee and any agent of SFC or the
Trustee as the absolute owner of such Global Note for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent SFC, the Trustee or
any agent of SFC or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or impair, as between
the Depositary and its Participants or Indirect Participants, the Applicable
Procedures or the operation of customary practices of the Depositary governing
the exercise of the rights of a holder of a beneficial interest in any Global
Note.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
(a) One Officer shall sign the Notes for SFC by manual or facsimile
signature.
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(b) If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
(c) A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
(d) The Trustee shall, upon a written order of SFC signed by an
Officer (an "AUTHENTICATION ORDER"), authenticate Notes for original issue.
(e) The Trustee may appoint an authenticating agent acceptable to
SFC to authenticate Notes. Unless otherwise provided in the appointment, an
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with Holders or an Affiliate of SFC or any of their respective
Subsidiaries.
SECTION 2.03. REGISTRAR; AND PAYING AGENT AND CONVERSION AGENT.
(a) SFC shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("REGISTRAR"), an office
or agency where Notes may be presented for payment ("PAYING AGENT") and an
officer or agency where Notes may be presented for conversion ("CONVERSION
AGENT"). The Registrar shall keep a register of the Notes and of their transfer
and exchange. SFC may appoint one or more co-registrars, one or more additional
paying agents and one or more additional conversion agents. The term "Registrar"
includes any co-registrar, the term "PAYING AGENT" includes any additional
paying agent and the term "Conversion Agent" includes any additional conversion
agent. SFC may change any Paying Agent, Registrar or Conversion Agent without
notice to any Holder. SFC shall notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. If SFC fails to appoint or
maintain another entity as Registrar, Paying Agent or Conversion Agent, the
Trustee shall act as such. SFC or any of its Subsidiaries may act as Paying
Agent, Registrar or Conversion Agent.
(b) SFC initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
(c) SFC initially appoints the Trustee to act as the Registrar,
Paying Agent and Conversion Agent with respect to the Notes and to act as
Custodian with respect to the Global Notes, and the Trustee hereby initially
agrees so to act.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
SFC 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 the
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest and Special Interest, if any, on the
Notes, and shall notify the Trustee of any default by SFC in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. SFC at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than SFC or a Subsidiary) shall have no
further liability for the money. If SFC or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to SFC, the Trustee shall serve as Paying Agent for the
Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, SFC shall furnish to the Trustee at least seven 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 or such shorter
time as the Trustee may allow, as the Trustee may reasonably require of the
names and addresses of the Holders and SFC shall otherwise comply with TIA
Section 312(a).
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SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
SFC for Definitive Notes if (1) SFC delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and, in
either case, a successor Depositary is not appointed by SFC within 120 days
after the date of such notice from the Depositary or (2) SFC in its sole
discretion determines that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and delivers a written notice to such effect to
the Trustee; or (3) an Event of Default entitling the Holders to accelerate
shall have occurred and be continuing and the Registrar has received a written
request from the Depositary to issue Definitive Notes; provided that in no event
shall the Regulation S Temporary Global Note be exchanged by SFC for Definitive
Notes prior to (x) the expiration of the Distribution Compliance Period and (y)
the receipt by the Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act. Upon the occurrence of any of the
preceding events in (1), (2) or (3) above, Definitive Notes shall be issued in
denominations of $1.00 or integral multiples thereof and in such names as the
Depositary shall instruct the Trustee in writing. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Section 2.07 and
Section 2.10 hereof. Every Note authenticated and delivered in exchange for, or
in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06
or Section 2.07 or Section 2.10 hereof, shall be authenticated and delivered in
the form of, and shall be, a Global Note. A Global Note may not be exchanged for
another Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b) or (c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either clause (i) or (ii) below, as applicable, as well as one
or more of the other following clauses, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Distribution Compliance Period,
transfers of beneficial interests in the Regulation S Temporary Global
Note may not be made to a U.S. Person or for the account or benefit of a
U.S. Person (other than a distributor (as defined in Rule 902(d) of the
Securities Act)). Beneficial interests in any Unrestricted Global Note may
be transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above, the
transferor of such beneficial interest must deliver to the Registrar
either (A)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given in accordance with the Applicable Procedures containing information
regarding the Participant account to be credited with such increase or
(B)(1) a written order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive Note in an amount equal
to the beneficial interest to be transferred or exchanged and (2)
instructions given by the Depositary to the Registrar containing
information regarding the Person in whose name such Definitive Note shall
be registered to effect the transfer or exchange referred to in (B)(1)
above; provided that in no event shall Definitive Notes be issued upon the
transfer or exchange of beneficial interests in the Regulation S Temporary
Global Note prior to (x) the expiration of the Distribution Compliance
Period and (y) the receipt by the Registrar of any certificates required
pursuant to Rule
34
903(b)(3)(ii)(B) under the Securities Act. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Indenture and the Notes or otherwise applicable
under the Securities Act, the Trustee shall adjust the principal amount of
the relevant Global Note(s) pursuant to Section 2.06(g) hereof.
(iii) Transfer of Beneficial Interests in a Restricted Global
Note to Another Restricted Global Note. A beneficial interest in any
Restricted Global Note may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another Restricted Global
Note if the transfer complies with the requirements of Section 2.06(b)(ii)
above and the Registrar receives the following:
(A) if the transferee will take delivery in the form of
a beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of
a beneficial interest in the Regulation S Temporary Global Note or
the Regulation S Permanent Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of
a beneficial interest in the IAI Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications and certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be exchanged
by any holder thereof for a beneficial interest in an Unrestricted Global
Note or transferred to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(B) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof;
or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note,
a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (B), if the Registrar and SFC so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to clause (A) or (B) above
at a time when an Unrestricted Global Note has not yet been issued, SFC shall
issue and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global
Notes in an aggregate principal amount equal to the aggregate principal amount
of beneficial interests transferred pursuant to clause (A) or (B) above.
35
(v) Transfer or Exchange of Beneficial Interests in
Unrestricted Global Notes for Beneficial Interests in Restricted Global
Notes Prohibited. Beneficial interests in an Unrestricted Global Note
cannot be exchanged for, or transferred to Persons who take delivery
thereof in the form of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of a Restricted Definitive
Note, then, upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note, a certificate from such holder in
the form of Exhibit C hereto, including the certifications in item
(2)(a) thereof;
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such beneficial interest is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in clauses (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)(d) thereof,
if applicable;
(F) if such beneficial interest is being transferred to
SFC or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(g) hereof, and SFC shall
execute and the Trustee shall authenticate and deliver to the Person designated
in the instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c) shall be registered in such name or
names and in such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions from the
Depositary and the Participant or Indirect Participant. The Trustee shall mail
or deliver such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial interest in
a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the
Private Placement Legend and shall be subject to all restrictions on transfer
contained therein.
(ii) Notwithstanding Section 2.06(c)(i)(A) and (C) hereof, a
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Definitive Note or transferred to a
36
Person who takes delivery thereof in the form of a Definitive Note prior
to (x) the expiration of the Distribution Compliance Period and (y) the
receipt by the Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act, except in the case of a
transfer pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest to a
Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(B) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for an Unrestricted Definitive Note, a certificate
from such holder in the form of Exhibit C hereto, including
the certifications in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of an Unrestricted Definitive Note, a certificate from
such holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this clause (B), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest in
an Unrestricted Global Note proposes to exchange such beneficial interest
for a Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Definitive Note, then, upon
satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(g) hereof,
and SFC shall execute and the Trustee shall authenticate and mail or
deliver to the Person designated in the instructions a Definitive Note in
the appropriate principal amount. Any Definitive Note issued in exchange
for a beneficial interest pursuant to this Section 2.06(c)(iii) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall mail or deliver such Definitive
Notes to the Persons in whose names such Notes are so registered. Any
Definitive Note issued in exchange for a beneficial interest pursuant to
this Section 2.06(c)(iii) shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a Restricted
Global Note or to transfer such Restricted Definitive Notes to a Person
who takes delivery thereof in the form of a beneficial interest in a
Restricted Global Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item (2)(b)
thereof;
37
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in reliance on
an exemption from the registration requirements of the Securities
Act other than those listed in clauses (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications, certificates and Opinion of Counsel required by
item (3)(d) thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to SFC or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement under
the Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the Regulation S Global Note,
and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note only if:
(A) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(B) the Registrar receives the following:
(1) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial interest in
the Unrestricted Global Note, a certificate from such Holder
in the form of Exhibit C hereto, including the certifications
in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit B hereto, including the certifications in
item (4) thereof;
and, in each such case set forth in this clause (B), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.
38
Upon satisfaction of the conditions of any of the clauses in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase
or cause to be increased the aggregate principal amount of the Unrestricted
Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Unrestricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted Definitive
Note and increase or cause to be increased the aggregate principal amount
of one of the Unrestricted Global Notes.
(iv) Transfer or Exchange of Unrestricted Definitive Notes to
Beneficial Interests in Restricted Global Notes Prohibited. An
Unrestricted Definitive Note cannot be exchanged for, or transferred to
Persons who take delivery thereof in the form of, beneficial interests in
a Restricted Global Note.
(v) Issuance of Unrestricted Global Notes. If any such
exchange or transfer from a Definitive Note to a beneficial interest is
effected pursuant to clauses (ii)(A), (ii)(B) or (iii) above at a time
when an Unrestricted Global Note has not yet been issued, SFC shall issue
and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal
amount of Definitive Notes so transferred.
(vi) This clause (d) is subject to the restrictions set forth
in Section 2.01(b) and Section 2.16.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and registered
in the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A,
then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
39
(B) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive
Notes proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(d)
thereof; or
(2) if the Holder of such Restricted Definitive
Notes proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of an Unrestricted
Definitive Note, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this clause (B), if the Registrar so
requests, an Opinion of Counsel in form reasonably acceptable to the Registrar
and SFC to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in order to maintain compliance
with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant to
the instructions from the Holder thereof.
(f) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by clause (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, ON ITS
OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE
(THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SFC OR ANY
AFFILIATE OF SFC WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH
SECURITY), ONLY (A) TO SFC, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF $250,000, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
40
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO SFC'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS
THAT (A) IT IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), PLAN, INDIVIDUAL RETIREMENT
ACCOUNT OR OTHER ARRANGEMENT SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE
CODE ("CODE") OR PROVISIONS UNDER APPLICABLE FEDERAL, STATE, LOCAL, NON-U.S. OR
OTHER LAWS OR REGULATIONS THAT ARE SIMILAR TO SUCH PROVISIONS OF ERISA OR THE
CODE ("SIMILAR LAWS"), AN ENTITY WHOSE UNDERLYING ASSETS ARE CONSIDERED TO
INCLUDE "PLAN ASSETS" OF SUCH PLANS, ACCOUNTS AND ARRANGEMENTS (EACH A "PLAN")
AND IS NOT PURCHASING THE NOTES ON BEHALF OF OR WITH "PLAN ASSETS" OF ANY PLAN
OR (B) ITS PURCHASE, HOLDING AND SUBSEQUENT DISPOSITION OF THE NOTES IS EITHER
NOT A PROHIBITED TRANSACTION UNDER ERISA OR THE CODE AND IS OTHERWISE
PERMISSIBLE UNDER ALL SIMILAR LAWS, OR IS ENTITLED TO EXEMPTIVE RELIEF FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND THE CODE IN ACCORDANCE WITH ONE
OR MORE OF THE PROHIBITED TRANSACTION CLASS EXEMPTIONS, AND IS OTHERWISE
PERMISSIBLE UNDER ALL APPLICABLE SIMILAR LAWS."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to clauses (b)(iv), (c)(iii),
(c)(iv), (d)(ii), (d)(iii), (e)(ii) or (e)(iii) to this Section 2.06
(and all Notes issued in exchange therefor or substitution thereof)
shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend
in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
SFC.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO SFC OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN."
(iii) Regulation S Temporary Global Note Legend. Each
Regulation S Temporary Global Note shall bear a legend in substantially
the following form:
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"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE,
AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES,
ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR
THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE
ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON."
(iv) Definitive Note Legend. Prior to delivery by SFC of the
Rule 144A Availability Notice to the Trustee, each Definitive Note shall
bear a legend in substantially the following form:
"UNTIL THE ISSUER DELIVERS THE RULE 144A AVAILABILITY NOTICE (AS
DEFINED IN THE INDENTURE GOVERNING THIS NOTE), (A) THIS SECURITY MAY NOT BE
TRANSFERRED IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT AND (B) THIS
SECURITY MAY NOT BE EXCHANGED FOR A BENEFICIAL INTEREST IN A GLOBAL NOTE OR
TRANSFERRED TO A PERSON THAT TAKES DELIVERY THEREOF IN THE FORM OF A BENEFICIAL
INTEREST IN A GLOBAL NOTE."
(g) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, SFC
shall execute and, upon receipt of an Authentication Order in accordance
with Section 2.02, the Trustee shall authenticate Global Notes and
Definitive Notes upon SFC's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive Note
for any registration of transfer or exchange, but SFC may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Section 2.10, Section 3.06, Section 3.09, Section 4.12, Section 4.18,
Section 4.22, Section 9.06 and Section 14.02(d) hereof).
(iii) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of SFC, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Global Notes or
Definitive Notes surrendered upon such registration of transfer or
exchange.
(iv) Neither the Registrar nor SFC shall be required (A) to
issue, to register the transfer of or to exchange any Notes during a
period beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 hereof and ending at
the close of business on the day of selection, (B) to register the
transfer of or to exchange any Note so selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in part
or (C) to register the transfer of or to exchange a Note between a record
date and the next succeeding Interest Payment Date.
(v) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and SFC may deem and treat
the Person in whose name any Note is registered as the
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absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes, and
none of the Trustee, any Agent or SFC shall be affected by notice to the
contrary.
(vi) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02 hereof.
(vii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by
facsimile.
(viii) The Trustee is hereby authorized to enter into a letter
of representation with the Depositary in the form provided by SFC and to
act in accordance with such letter.
SECTION 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or SFC and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, SFC shall issue and the Trustee, upon receipt of an Authentication
Order, shall authenticate a replacement Note if the Trustee's requirements are
met. If required by the Trustee or SFC, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and SFC to protect
SFC, the Trustee, any Agent and any authenticating agent from any loss that any
of them may suffer if a Note is replaced. SFC may charge for its expenses in
replacing a Note.
In case any such mutilated, destroyed, lost or stolen Note had
become or is about to become due and payable, SFC, in its discretion, may,
instead of issuing a new Note, pay such Note, upon satisfaction of the
conditions set forth in the preceding paragraph.
Every replacement Note is an additional obligation of SFC and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
The provisions of this Section 2.07 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies of any Holder with respect
to the replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time are all the Notes
authenticated by the Trustee or deemed outstanding pursuant to Section 4.01
except for those cancelled by it, those delivered to it for cancellation, those
reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and Notes described in this Section 2.08
as not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because SFC or an Affiliate of SFC holds the Note.
(b) If a Note is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced note is held by a bona fide purchaser.
(c) If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
(d) If the Paying Agent (other than SFC, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
(e) If the principal amount of any Note is converted under Article
14, it ceases to be outstanding and interest on it ceases to accrue on the close
of business on the Conversion Date therefor.
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SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, amendment, supplement, waiver or
consent, Notes owned by SFC, or by any Affiliate of SFC, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, amendment,
supplement, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.
SECTION 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery, SFC
may prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form
of certificated Notes but may have variations that SFC considers appropriate for
temporary Notes and as shall be reasonably acceptable to the Trustee. Without
unreasonable delay, SFC shall prepare and the Trustee shall authenticate
Definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
SECTION 2.11. CANCELLATION.
SFC at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent,
upon direction by SFC and no one else shall cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy cancelled Notes (subject to the record retention requirements of
the Exchange Act). Certification of the destruction of all cancelled Notes shall
be delivered to SFC from time to time upon request. SFC may not issue new Notes
to replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
SECTION 2.12. PAYMENT OF INTEREST; DEFAULTED INTEREST.
Interest on any Note which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Note (or one or more Predecessor Notes) is being registered at
the close of business on the Regular Record Date for such interest payment.
If SFC defaults in a payment of interest or Special Interest, if
any, on the Notes, it shall pay the defaulted interest in any lawful manner
plus, to the extent lawful, interest payable on the defaulted interest, to the
Persons who are Holders on a subsequent special record date, in each case at the
rate provided in the Notes and in Section 4.01 hereof. SFC shall notify the
Trustee in writing of the amount of defaulted interest proposed to be paid on
each Note and the date of the proposed payment. SFC shall fix or cause to be
fixed each such special record date and payment date, provided that no such
special record date shall be less than 10 days prior to the related payment date
for such defaulted interest. At least 15 days before the special record date,
SFC (or, upon the written request of SFC, the Trustee in the name and at the
expense of SFC) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
SECTION 2.13. CUSIP OR ISIN NUMBERS.
SFC in issuing the Notes may use "CUSIP" or "ISIN" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" or "ISIN" 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 Notes or as contained in any notice of
a redemption and that reliance may be placed only on the other identification
numbers printed on the Notes, and any such redemption shall not be affected by
any defect in or omission of such numbers. SFC will promptly notify the Trustee
of any change in the "CUSIP" or "ISIN" numbers.
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SECTION 2.14. SPECIAL INTEREST.
If Special Interest is payable by SFC pursuant to the Registration
Rights Agreement and paragraph 1 of the Notes, SFC shall deliver to the Trustee
a certificate to that effect stating (i) the amount of such Special Interest
that is payable and (ii) the date on which such interest is payable, which shall
not be later than the next Interest Payment Date. Unless and until a Responsible
Officer of the Trustee receives such a certificate or instruction or direction
from the Holders in accordance with the terms of this Indenture, the Trustee may
assume without inquiry that no Special Interest is payable. The foregoing shall
not prejudice the rights of the Holders with respect to their entitlement to
Special Interest as otherwise set forth in this Indenture or the Notes and
pursuing any action against SFC directly or otherwise directing the Trustee to
take any such action in accordance with the terms of this Indenture and the
Notes. If SFC has paid Special Interest directly to the persons entitled to it,
SFC shall deliver to the Trustee a certificate setting forth the particulars of
such payment.
SECTION 2.15. ISSUANCE OF PIK NOTES.
The Company shall be entitled to issue PIK Notes as provided in
Section 4.01 hereof. With respect to such PIK Notes, the Company shall deliver
to the Trustee;
(a) no later than the record date for the relevant Interest Payment
Date, a written notice setting forth the extent to which such interest will be
made in the form of a PIK Note or Notes; and
(b) not later than one Business Day prior to the relevant Interest
Payment Date, an order to authenticate and deliver such PIK Notes.
Any PIK Note shall, after being executed and authenticated pursuant
to Section 2.02, be (i) delivered by the Trustee to the Holders as of the
relevant record date at such Holders' registered address if the Notes are then
held in the form of Definitive Notes, or (ii) deposited with or on behalf of DTC
for the benefit of the Beneficial Owners as of the relevant record date if the
Notes are held in the form of a Global Note.
SECTION 2.16. RULE 144A AVAILABILITY NOTICE.
Until SFC delivers the Rule 144A Availability Notice, (i) no Note
may be transferred in reliance on Rule 144A under the Securities Act and (ii) no
Note may be exchanged for a beneficial interest in a Global Note or transferred
to a Person that takes delivery thereof in the form of a beneficial interest in
a Global Note.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If SFC elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof and paragraph 5 of the Notes, it shall furnish
to the Trustee, at least 30 days (or in the case of a partial redemption, at
least 45 days) but not more than 60 days before a redemption date unless a
shorter notice shall be satisfactory to the Trustee, an Officers' Certificate
setting forth (i) the clause of this Indenture pursuant to which the redemption
shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be
redeemed and (iv) the redemption price. Any such notice may be cancelled at any
time prior to notice of such redemption being mailed to any Holder and shall,
therefore, be void and of no effect.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select the Notes to be redeemed among the Holders of the Notes in
compliance with any applicable depositary and legal requirements and the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a pro rata basis, at
random or in accordance with any other method the Trustee considers fair and
appropriate. In the event of partial redemption at random, the particular Notes
to be redeemed shall be selected,
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unless otherwise provided herein, not less than 30 nor more than 60 days prior
to the redemption date by the Trustee from the outstanding Notes not previously
called for redemption.
The Trustee shall promptly notify SFC in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1.00 or whole multiples of $1.00; except
that if all of the Notes of a Holder are to be redeemed, the entire outstanding
amount of Notes held by such Holder, even if not a multiple of $1.00, shall be
redeemed. Except as provided in the preceding sentence, provisions of this
Indenture that apply to Notes called for redemption also apply to portions of
Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date,
SFC shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent and the Conversion
Agent;
(e) the then effective Conversion Rate and any adjustments to the
Conversion Rate that SFC expects to make prior to the redemption date;
(f) that Notes called for redemption may be converted into Common
Stock pursuant to Article 14 of this Indenture on or prior to the Business Day
preceding the redemption date;
(g) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(h) that, unless SFC defaults in making such redemption payment,
interest and Special Interest, if any, on Notes called for redemption ceases to
accrue on and after the redemption date;
(i) the paragraph of the Notes or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed; and
(j) 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 Notes.
At SFC's request, the Trustee shall give the notice of redemption in
SFC's name and at its expense; provided, however, that SFC shall have delivered
to the Trustee, at least 45 days, or such shorter period allowed by the Trustee,
prior to the redemption date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in Section 3.01 and this Section 3.03. If any of the Notes
are in the form of a Global Note, then SFC shall modify such notice to the
extent necessary to comply with the Applicable Procedures that apply to the
redemption of Global Notes.
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SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price, together with accrued but unpaid
interest and Special Interest, if any, thereon, except for Notes which are
converted in accordance with the terms of this Indenture. A notice of redemption
may not be conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
On or before 11:00 a.m. New York time on any redemption date, SFC
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued and unpaid interest and Special Interest, if
any, up to, but excluding, the redemption date, on all Notes (or portions of
Notes) to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to SFC any money deposited with the Trustee or the Paying Agent
by SFC in excess of the amounts necessary to pay the redemption price of, and
accrued interest and Special Interest, if any, on, all Notes to be redeemed.
If SFC complies with the provisions of the preceding paragraph, on
and after the redemption date, interest and Special Interest, if any, shall
cease to accrue on the Notes or the portions of Notes called for redemption,
whether or not such Notes are presented for payment. If a Note is redeemed on or
after a Regular Record Date but on or prior to the related Interest Payment
Date, then any accrued and unpaid interest and Special Interest, if any, as of
the date of redemption, shall be paid to the Person in whose name such Note was
registered at the close of business on such Regular Record Date and no
additional interest shall be payable to Holders whose Notes are being redeemed.
If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of SFC to comply with the preceding paragraph,
interest and Special Interest, if any, shall be paid on the unpaid principal
from the redemption date until such principal is paid, and to the extent lawful
on any interest not paid on such unpaid principal, in each case at the rate
provided in the Notes and in Section 4.01 hereof.
SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, SFC shall issue
and, upon SFC's written request, the Trustee shall authenticate for the Holder
at the expense of SFC a new Note equal in principal amount to the unredeemed
portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07, the
Notes will not be redeemable at the option of SFC prior to the Final Maturity
Date.
(b) SFC may redeem all or any portion of the Notes after giving the
required notice under this Indenture:
(i) at once or over time at any time during the 365
consecutive day period ending on the Final Maturity Date, but only if the
Qualified IPO Effective Date has not occurred prior to such redemption, at
a redemption price equal to 105.125% of the aggregate principal amount of
the Notes to be redeemed; and
(ii) if (A) the Qualified IPO Effective Date is on or prior to
March 11, 2008 and (B) prior to the date a notice of redemption is sent
pursuant to this Section 3.07, the average of the Closing Price of the
Common Stock for each of 20 consecutive Trading Days ending on the date
prior to the date such redemption notice is sent, appropriately adjusted
to take into account stock splits and similar events that occur, is
greater than or equal to 120% of the Conversion Price, at once or over
time at any time during the 365 consecutive day period ending on the Final
Maturity Date at a redemption price equal to 100.00% of the aggregate
principal amount of the Notes to be redeemed;
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plus, in either case, accrued and unpaid interest, including Special Interest,
if any, to, but excluding, the redemption date (subject to the right of Holders
of record on the relevant record date to receive interest due on the relevant
Interest Payment Date).
If the Qualified IPO Effective Date does not occur on or prior to March 11,
2008, SFC may not redeem the Notes except as provided in clause (b)(i) above.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through Section 3.06 hereof. Any
Notes redeemed pursuant to this Section 3.07 shall be delivered to the Trustee
for cancellation in accordance with Section 2.11.
SECTION 3.08. MANDATORY REDEMPTION OR REPURCHASE.
Except as set forth in Section 3.09, Section 4.12 and Section 4.18
hereof, SFC shall not be required to make mandatory redemption payments,
repurchase offers or sinking fund payments with respect to the Notes.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
(a) In the event that, pursuant to Section 4.12 hereof, SFC or
HoldCo 3 shall be required to commence an offer to all Holders to purchase Notes
(an "ASSET SALE OFFER"), it shall follow the procedures specified below.
(b) The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "OFFER PERIOD"). No
later than five Business Days after the termination of the Offer Period (the
"PURCHASE DATE"), SFC or HoldCo 3 shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.12 hereof (the "OFFER AMOUNT")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after a Regular Record Date but on
or prior to the related Interest Payment Date, then any accrued and unpaid
interest and Special Interest, if any, to, but excluding, the Purchase Date
shall be paid to the Person in whose name a Note is registered at the close of
business on such Regular Record Date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of the Asset Sale Offer, SFC or HoldCo 3
shall send, by first class mail, a notice to the Trustee and each of the
Holders, with a copy to the Trustee. The notice shall contain all instructions
and materials necessary to enable such Holders to tender Notes pursuant to the
Asset Sale Offer. The Asset Sale Offer shall be made to all Holders. The notice,
which shall govern the terms of the Asset Sale Offer, shall state:
(i) that the Asset Sale Offer is being made pursuant to this
Section 3.09 and Section 4.12 hereof and the length of time the Asset Sale
Offer shall remain open;
(ii) the Offer Amount, the purchase price and the Purchase
Date;
(iii) that any Note not tendered or accepted for payment shall
continue to accrue interest;
(iv) that, unless SFC defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest and Special Interest, if any, after the Purchase Date;
(v) that Holders electing to have a Note purchased pursuant to
an Asset Sale Offer may elect to have Notes purchased in integral
multiples of $1.00 only;
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(vi) that Holders electing to have a Note purchased pursuant
to any Asset Sale Offer shall be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, or transfer by book-entry transfer, to SFC or HoldCo 3, a
depositary, if appointed by SFC or HoldCo 3, or a Paying Agent at the
address specified in the notice at least three days before the Purchase
Date;
(vii) the name and address of each Paying Agent and Conversion
Agent;
(viii) the then effective Conversion Rate and any adjustments
to the Conversion Rate that SFC expects to make prior to the Purchase
Date;
(ix) that Notes may be converted into the Common Stock
pursuant to Article 14 of this Indenture only to the extent that the Asset
Sale Offer purchase election has been withdrawn in accordance with the
terms of this Indenture;
(x) that Holders shall be entitled to withdraw their election
if SFC, HoldCo 3, the depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a telegram,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note
purchased;
(xi) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, SFC or HoldCo 3 shall
select the Notes to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by SFC or HoldCo 3 so that only
Notes in denominations of $1.00 or integral multiples thereof shall be
purchased); and
(xii) that Holders whose Notes were purchased only in part
shall be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, SFC or HoldCo 3 shall, to the
extent lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Notes or portions thereof tendered pursuant to the Asset
Sale Offer, or if less than the Offer Amount has been tendered, all Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating that
such Notes or portions thereof were accepted for payment by SFC or HoldCo 3 in
accordance with the terms of this Section 3.09. SFC, HoldCo 3, the depositary or
the Paying Agent, as the case may be, shall promptly (but in any case not later
than five Business Days after the Purchase Date) mail or deliver to each
tendering Holder an amount equal to the purchase price of the Notes tendered by
such Holder and accepted by SFC or HoldCo 3 for purchase, and SFC shall promptly
issue a new Note, and the Trustee, upon written request from SFC shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered. Any Note not so
accepted shall be promptly mailed or delivered by SFC to the Holder thereof. SFC
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date. Any Notes or portion of Notes purchased pursuant to this Section 3.09
shall be delivered to the Trustee for cancellation in accordance with Section
2.11.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Section 3.01 through Section 3.06 hereof.
ARTICLE 4.
COVENANTS
On and after the IPO Effective Date, SFC, HoldCo 3 and its
Restricted Subsidiaries and the other Guarantors will not be subject to the
provisions of Section 4.09, Section 4.10, Section 4.12, Section 4.13, Section
4.14, Section 4.15, Section 4.16 and Section 4.17. On and after the Qualified
IPO Effective Date, SFC, HoldCo 3 and its Restricted Subsidiaries and the other
Guarantors will not be subject to the provisions of Section 4.07(e), Section
4.11, Section 4.25, Section 4.26 and Section 4.27.
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SECTION 4.01. PAYMENT OF NOTES.
(a) Interest on the Notes shall accrue (i) prior to the Qualified
IPO Effective Date, at the rate of 10.25% per annum if interest is paid in cash
and at the rate of 11.25% per annum if interest is paid in the form of PIK Notes
and (ii) on and after the Qualified IPO Effective Date, at the rate of 6.00% per
annum in cash. SFC shall pay interest semi-annually on May 1 and November 1 of
each year, or if such day is not a Business Day, on the next succeeding Business
Day (each, an "INTEREST PAYMENT DATE").
(b) During the Interest Restricted Period, SFC shall pay cash
interest due on the Notes on each Interest Payment Date to the extent of
Available Cash on such Interest Payment Date. To the extent that Available Cash
on an Interest Payment Date is insufficient to pay in full all interest due on
the Notes on such Interest Payment Date in cash, SFC shall pay any such cash
deficiency (the "DEFICIENCY") by issuing, causing the Trustee to authenticate
and delivering to the Holders, on such Interest Payment Date, additional Notes
(each a "PIK NOTE") having an aggregate principal amount equal to the PIK
Interest Portion (as defined below) on such Interest Payment Date, having an
issuance date as of such Interest Payment Date and otherwise having
substantially identical terms to the Notes (including, with respect to the
interest rate). PIK Notes shall be issuable pursuant to Section 2.15 hereof. The
"PIK INTEREST PORTION" on any Interest Payment Date shall be an amount equal to
the result of multiplying (i) the quotient of (A) the Deficiency with respect to
such Interest Payment Date divided by (B) the accrued and unpaid cash interest
payable on such Interest Payment Date (determined prior to the application of
any Available Cash), by (ii) the aggregate principal amount of Notes outstanding
on the Interest Payment Date (excluding the PIK Notes, if any, to be issued on
such Interest Payment Date under this Section 4.01(b)) and by (iii) 11.25% per
annum.
(c) Subject to clause (b) above, prior to the Qualified IPO
Effective Date, SFC will pay interest in either cash or in PIK Notes or both at
its option. On and after the Qualified IPO Effective Date, interest shall be
paid only in cash.
(d) Interest on each PIK Note shall accrue from the Interest
Payment Date in respect of which such additional PIK Note was issued until
repayment of the principal and payment of all accrued interest in full. If for
any reason one or more PIK Notes shall not be issued, authenticated and
delivered in accordance herewith, such PIK Notes shall be deemed to have been
issued, authenticated and delivered for all purposes of this Indenture and, in
particular, interest shall accrue on the Notes such that the aggregate interest
due and payable at maturity and on each Interest Payment Date would be the same
as if all PIK Notes not issued, authenticated and delivered had been issued,
authenticated and delivered, and the principal amount payable at maturity with
respect to the outstanding Notes shall be an amount equal to the sum of the
principal amount outstanding hereunder and the aggregate principal amount that
would be outstanding if the PIK Notes not issued, authenticated and delivered
had been issued, authenticated and delivered.
(e) During the Interest Restricted Period, to the extent of
Available Cash, (i) SFC and HoldCo 3 shall cause OpCo to declare and pay a cash
dividend or distribute to HoldCo 3 the amount of interest due on the Notes on
such Interest Payment Date (the "CASH INTEREST DIVIDEND"), (ii) HoldCo 3 shall
declare and pay the Cash Interest Dividend to HoldCo 2, (iii) SFC shall cause
Intermediary Sub to cause HoldCo 2 to declare and pay the Cash Interest Dividend
to Intermediary Sub and (iv) SFC shall cause Intermediary Sub to declare and pay
the Cash Interest Dividend to SFC.
(f) SFC shall pay or cause to be paid the principal of, premium,
if any, interest and Special Interest, if any, on, the Notes on the dates and in
the manner provided herein and in the Notes. Principal, premium, if any, and
interest and Special Interest, if any, shall be considered paid on the date due
if the Paying Agent, if other than SFC or a Subsidiary thereof, holds as of
11:00 a.m. New York time on the due date a duly issued and authenticated PIK
Note or money deposited by SFC in immediately available funds and designated for
and sufficient to pay all principal, premium, if any, and interest and Special
Interest, if any, then due. SFC shall pay Special Interest, if any, in the same
manner as provided herein for interest, on the dates and in the amounts set
forth in the Registration Rights Agreement.
(g) SFC shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; it shall pay interest (including post-petition interest in
any proceeding
50
under any Bankruptcy Law) on overdue installments of interest and Special
Interest, if any (without regard to any applicable grace periods), from time to
time on demand at the same rate to the extent lawful.
(h) Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) SFC shall maintain an office or agency (which may be an office
or drop facility of the Trustee or an affiliate of the Trustee, Registrar or
co-registrar, Paying Agent or Conversion Agent) where Notes may be presented or
surrendered for registration of transfer, for exchange or conversion and where
notices and demands to or upon SFC in respect of the Notes and this Indenture
may be served. SFC shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time SFC shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and SFC hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
(b) SFC may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. SFC shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
(c) SFC hereby designates the Corporate Trust Office of the
Trustee, as one such office, drop facility or agency of SFC in accordance with
Section 2.03.
SECTION 4.03. REPORTS.
(a) Prior to the IPO Effective Date, notwithstanding that HoldCo 3
may not be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act so long as any Notes are outstanding, HoldCo 3 shall file with the
Commission, to the extent such submissions are accepted for filing with the
Commission, and shall furnish to the Trustee, within 15 days after it is or
would have been required to be filed with the Commission:
(i) all quarterly and annual financial information that would
be required to be contained in a filing with the Commission on Forms 10-Q
and 10-K if HoldCo 3 were required to file such Forms with respect to the
Senior Notes under Section 15(d) of the Exchange Act, including a
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" and, with respect to the annual information only, a report
on the annual financial statements certified by the certified independent
accountants of HoldCo 3; and
(ii) all information that would be required to be filed with
the Commission on Form 8-K if HoldCo 3 were required to file such reports
with respect to the Senior Notes;
(b) Following the IPO Effective Date, notwithstanding that SFC may
not be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, so long as any Notes are outstanding, SFC shall file with the
Commission, to the extent such submissions are accepted for filing with the
Commission, and shall furnish to the Trustee, within 15 days after it is or
would have been required to be filed with the Commission:
(i) all quarterly and annual financial information that would
be required to be contained in a filing with the Commission on Forms 10-Q
and 10-K if SFC were required to file such Forms with respect to the Notes
under Section 15(d) of the Exchange Act, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
with respect SFC, HoldCo 3 and any other Guarantors and, with respect to
the annual information only, a report on the annual financial statements
of SFC, including the financial information about HoldCo 3 and any other
Guarantor required by Regulation S-X under the Securities Act, in each
case, certified by the certified independent accountants of SFC; and
(ii) all information that would be required to be filed with
the Commission on Form 8-K if SFC were required to file such reports with
respect to the Notes.
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(c) At any time prior to the IPO Effective Date and after delivery
by SFC to the Trustee of the Rule 144A Availability Notice, SFC and any
Guarantors other than HoldCo 3 shall furnish to the Holders, upon their request,
the information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
SECTION 4.04. COMPLIANCE CERTIFICATES.
(a) SFC shall deliver to the Trustee, within 120 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of SFC and its Subsidiaries during the preceding fiscal year has been
made under the supervision of the signing Officers with a view to determining
whether SFC and its Subsidiaries have kept, observed, performed and fulfilled
their obligations under this Indenture, and further stating, as to each such
Officer signing such certificate, that to the best of his or her knowledge SFC
and its Subsidiaries have kept, observed, performed and fulfilled each and every
covenant contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions of this Indenture (or,
if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action SFC is taking or proposes to take with respect thereto) and that to the
best of his or her knowledge no event has occurred and remains in existence by
reason of which payments on account of the principal of or interest or Special
Interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action SFC is taking or proposes to take with
respect thereto.
(b) SFC shall comply with TIA Section 314(a)(2).
(c) SFC shall deliver to the Trustee, within 5 Business Days after
becoming aware of the occurrence thereof, written notice in the form of an
Officers' Certificate of any event that with the giving of notice and the lapse
of time would become an Event of Default, its status and what action SFC is
taking or proposes to take with respect thereto.
(d) HoldCo 3 shall deliver to the Trustee, within 120 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of HoldCo 3 and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether HoldCo 3 and its Subsidiaries have kept, observed, performed
and fulfilled their obligations under this Indenture, and further stating, as to
each such Officer signing such certificate, that to the best of his or her
knowledge HoldCo 3 and its Subsidiaries have kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions and
conditions of this Indenture (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she
may have knowledge and what action HoldCo 3 is taking or proposes to take with
respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of the
principal of or interest or Special Interest, if any, on the Notes is prohibited
or if such event has occurred, a description of the event and what action HoldCo
3 is taking or proposes to take with respect thereto.
(e) HoldCo 3 shall comply with TIA Section 314(a)(2).
(f) HoldCo 3 shall deliver to the Trustee, within 5 Business Days
after becoming aware of the occurrence thereof, written notice in the form of an
Officers' Certificate of any event that with the giving of notice and the lapse
of time would become an Event of Default, its status and what action HoldCo 3 is
taking or proposes to take with respect thereto.
SECTION 4.05. TAXES.
SFC and HoldCo 3 shall pay or discharge, and shall cause the
Restricted Subsidiaries to pay or discharge, prior to delinquency, all material
taxes, assessments, and governmental levies; provided that none of SFC, HoldCo 3
or any such Restricted Subsidiary shall be required to pay or discharge, or
cause to be paid or discharged, any such tax, assessment, charge or claim the
amount, applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate reserves have been established in
accordance with GAAP or where the failure to effect such payment is not adverse
in any material respect to the Holders.
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SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
SFC and HoldCo 3 each covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and SFC and HoldCo 3
each (to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it shall not, by resort
to any such law, 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 has been enacted.
SECTION 4.07. CORPORATE EXISTENCE; OWNERSHIP OF SUBSIDIARIES.
(a) Subject to Article 5 hereof, HoldCo 3 shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of HoldCo 3 or any such
Restricted Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of HoldCo 3 and its Restricted Subsidiaries; provided, however, that
HoldCo 3 shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Restricted
Subsidiaries, if the Board of Directors of HoldCo 3 shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
HoldCo 3 and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes.
(b) Subject to Article 5 hereof, SFC shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of HoldCo 3 and its Restricted Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of SFC,
HoldCo 3 or any such Restricted Subsidiary and (ii) the rights (charter and
statutory), licenses and franchises of SFC, HoldCo 3 and its Restricted
Subsidiaries; provided, however, that SFC shall not be required to preserve any
such right, license or franchise, or the corporate, partnership or other
existence of any of its Restricted Subsidiaries, if the Board of Directors of
SFC shall determine that the preservation thereof is no longer desirable in the
conduct of the business of SFC and its Subsidiaries, taken as a whole, or HoldCo
3 and its Restricted Subsidiaries, taken as a whole, and that the loss thereof
is not adverse in any material respect to the Holders of the Notes.
(c) Notwithstanding clause (a) above or Article 5, HoldCo 3 shall
not consolidate or merge with or into any other Person or sell, lease, exchange
or otherwise transfer, in one transaction or a series of related transactions,
all or substantially all of the assets of HoldCo 3 taken as a whole to any
Person or Group (whether or not in compliance with the provisions of this
Indenture) other than with, into or to SFC or any Wholly Owned Subsidiary of SFC
other than HoldCo 2 if such transaction does not violate any other provision of
this Indenture.
(d) Notwithstanding Article 5, SFC shall ensure that, except in
the case of a merger with or into SFC as provided in Section 4.07(c), HoldCo 3
or any successor entity as a result of a transaction permitted by Section
4.07(c) shall remain a Wholly Owned Subsidiary of SFC so long as any Notes are
outstanding and SFC shall not, and shall cause any intermediate Subsidiary not
to, pledge or otherwise encumber or transfer the Capital Stock of HoldCo 3.
(e) During the Restricted Period, SFC shall ensure that OpCo
remains a direct Wholly Owned Subsidiary of HoldCo 3. It is acknowledged that
after the Qualified IPO Effective Date, HoldCo 3 shall be permitted under this
Indenture to contribute the Capital Stock of OpCo to a Wholly Owned Restricted
Subsidiary, and any such transaction shall not constitute an Asset Sale or
otherwise be prohibited by any provisions of this Indenture.
SECTION 4.08. PAYMENTS FOR CONSENT.
SFC and HoldCo 3 will not, and will not permit any of their
respective Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to or for the
benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or
53
provisions of this Indenture or the Notes unless such consideration is offered
to be paid or is paid to all Holders that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.09. INCURRENCE OF ADDITIONAL DEBT AND ISSUANCE OF CAPITAL STOCK.
(a) HoldCo 3 shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, Incur any Debt (including Acquired
Debt), other than Permitted Debt, and HoldCo 3 shall not issue any Disqualified
Capital Stock and its Restricted Subsidiaries shall not issue any Preferred
Stock, except Preferred Stock issued to HoldCo 3 or a Restricted Subsidiary of
HoldCo 3; provided, however, that HoldCo 3 and any Restricted Subsidiary may
Incur Debt or issue shares of such Capital Stock, in either case, if on the date
of that Incurrence or issuance, and after giving effect to the Incurrence of
such Debt or the issuance of such Capital Stock and the application of the
proceeds therefrom, the Consolidated Coverage Ratio of HoldCo 3 would be greater
than 2.00 to 1.00. Notwithstanding the foregoing, during the Restricted Period,
HoldCo 3 shall not (i) Incur any Debt (including Acquired Debt), other than (A)
the Guarantee by HoldCo 3 hereunder, (B) the Senior Notes, (C) any other Debt
existing on the date hereof, (D) Refinancing Debt and (E) guarantees of any Debt
of Restricted Subsidiaries permitted by this Indenture to be Incurred, or (ii)
issue any Disqualified Capital Stock.
(b) For purposes of determining compliance with paragraph (a) of
this Section 4.09, in the event that an item of proposed Debt meets the criteria
of more than one of the categories of Permitted Debt or is entitled to be
Incurred pursuant to paragraph (a) of this Section 4.09, HoldCo 3 may, in its
sole discretion, at the time the proposed Debt is Incurred:
(i) classify all or a portion of that item of Debt on the date
of its Incurrence under either paragraph (a) of this Section 4.09 or under
any category of Permitted Debt;
(ii) reclassify at a later date all or a portion of that or
any other item of Debt as being or having been Incurred in any manner that
complies with this Section 4.09 (without taking into account the last
sentence of Section 4.09(a)); and
(iii) elect to comply with this Section 4.09 and the
applicable definitions in any order;
provided, however, that all outstanding Debt under the Senior Credit Facilities
immediately following the date the Notes are first issued shall be deemed to
have been incurred pursuant to clause (2) of the definition of Permitted Debt.
SECTION 4.10. RESTRICTED PAYMENTS.
(a) HoldCo 3 shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, make any Restricted Payment
if at the time of that Restricted Payment and immediately after giving effect to
that Restricted Payment:
(i) a Default or Event of Default shall have occurred and be
continuing or would result from that Restricted Payment;
(ii) HoldCo 3 is not able to Incur an additional $1.00 of Debt
pursuant to paragraph (a) of Section 4.09 (without taking into account the
last sentence thereof); or
(iii) the aggregate amount of the Restricted Payment and all
other Restricted Payments declared or made subsequent to the date the
Notes are first issued would exceed the sum of:
(A) 50% of Consolidated Net Income of HoldCo 3 accrued
subsequent to February 27, 2005 to the most recent date for which
financial information is available to HoldCo 3, taken as one
accounting period (or if the aggregate amount of Consolidated Net
Income for such period shall be a deficit, minus 100% of such
deficit); plus
54
(B) 100% of the aggregate net proceeds, including the
net fair market value of property other than cash as determined by
the Board of Directors of HoldCo 3 in good faith, received
subsequent to the date the Notes are first issued by HoldCo 3 from
any Person, other than a Subsidiary of HoldCo 3, from (x) the issue
or sale of Equity Interests of HoldCo 3 (other than Disqualified
Capital Stock) (including, without limitation, in a merger,
consolidation, acquisition of property or any other form of
transaction where the consideration involved consists solely of
Capital Stock (other than Disqualified Capital Stock)) or (y) the
issue or sale of Disqualified Capital Stock or debt securities of
HoldCo 3 or any of its Restricted Subsidiaries that have been
converted into or exchanged for Equity Interests of HoldCo 3 (other
than Disqualified Capital Stock) (including, without limitation, in
a merger, consolidation, acquisition of property or any other form
of transaction where the consideration involved consists solely of
Capital Stock (other than Disqualified Capital Stock)) subsequent to
the date the Notes are first issued, excluding, in each case,
Excluded Proceeds and excluding
(1) any net proceeds from issuances and sales
financed directly or indirectly using funds borrowed from
HoldCo 3 or any Restricted Subsidiary, until and to the extent
that borrowing is repaid, but including the proceeds from the
issuance and sale of any securities convertible into or
exchangeable for Qualified Capital Stock to the extent those
securities are so converted or exchanged and including any
additional proceeds received by HoldCo 3 upon the conversion
or exchange;
(2) any net proceeds received from issuances and
sales that are used to consummate a transaction described in
paragraph (b)(ii) of this Section 4.10;
(3) any net cash proceeds received from the
issuance and sale of Designated Preferred Stock; plus
(C) an amount equal to the sum, without duplication, of:
(1) the net reduction in Investments (other than
Permitted Investments) made by HoldCo 3 or any of its
Restricted Subsidiaries in any Person resulting from
repurchases, repayments or redemptions of that Investment by
that Person;
(2) proceeds realized on the sale of that
Investment to an unaffiliated purchaser; and
(3) proceeds representing the return of capital
(excluding dividends and distributions),in each case, received
by HoldCo 3 or any of its Restricted Subsidiaries; plus
(D) an amount equal to the sum, without duplication, of
any amounts, including the net fair market value of property other
than cash as determined by the Board of Directors of HoldCo 3 in
good faith, received by HoldCo 3 or any of its Restricted
Subsidiaries as a capital contribution (including, without
limitation, in a merger, consolidation, acquisition of property or
any other form of transaction where the consideration involved
consists solely of Capital Stock (other than Disqualified Capital
Stock)) subsequent to the date the Notes are first issued
(including, without limitation, (A) any contributions to HoldCo 3 or
any of its Restricted Subsidiaries from SFC or Affiliates of SFC
under the Contribution Agreement or the Tax Sharing Agreement, (B)
any payments or contributions made directly to HoldCo 3 or any of
its Restricted Subsidiaries by any of the parties to the
Contribution Agreement or the Tax Sharing Agreement or (C) any
indemnification payments made directly to HoldCo 3 or any of its
Restricted Subsidiaries by any of the parties to the Acquisition
Agreement); plus
(E) if HoldCo 3 designates any Unrestricted Subsidiary
as a Restricted Subsidiary after the date the Notes are first
issued, an amount equal to the fair market value of the
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Investment in that Unrestricted Subsidiary by HoldCo 3 and its
Restricted Subsidiaries at the time the Unrestricted Subsidiary is
designated as a Restricted Subsidiary.
(b) The provisions of Section 4.10(a) will not prohibit:
(i) the payment of any dividend or the making of any
distribution within 60 days after the date of its declaration if the
dividend or distribution would have been permitted on the date it is
declared;
(ii) the declaration and payment of dividends to holders of
any class or series of Designated Preferred Stock (other than Disqualified
Capital Stock) issued after the date the Notes are first issued; provided,
however, that after giving effect to such issuance or declaration on a pro
forma basis, HoldCo 3 would be able to Incur an additional $1.00 of Debt
under paragraph (a) of Section 4.09, without giving effect to the last
sentence of Section 4.09(a);
(iii) the purchase, redemption or other acquisition or
retirement of any Capital Stock or Subordinated Debt of HoldCo 3 or any
warrants, options or other rights to acquire shares of any of that Capital
Stock either:
(A) solely in exchange for shares of Qualified Capital
Stock or other warrants, options or rights to acquire Qualified
Capital Stock,
(B) through the application of the net proceeds of a
substantially concurrent sale for cash, other than to a Subsidiary
of HoldCo 3, of shares of Qualified Capital Stock or warrants,
options or other rights to acquire Qualified Capital Stock, or
(C) in the case of Disqualified Capital Stock, solely in
exchange for, or through the application of the net proceeds of a
substantially concurrent sale for cash, other than to a Subsidiary
of HoldCo 3, of Disqualified Capital Stock;
(iv) repurchases of Capital Stock, warrants, options or rights
to acquire Capital Stock deemed to occur upon exercise of warrants,
options or rights to acquire Capital Stock if such Capital Stock,
warrants, options or rights represent a portion of the exercise price of
such warrants, options or rights;
(v) payments or distributions, directly or indirectly through
any direct or indirect parent of HoldCo 3, to dissenting stockholders
pursuant to applicable law or in connection with the settlement or other
satisfaction of legal claims made pursuant to or in connection with a
consolidation, merger or transfer of assets;
(vi) cash payments in lieu of the issuance of fractional
shares;
(vii) payments made to the holders of Equity Interests in any
Person that is merged or consolidated with or into HoldCo 3 or any
Restricted Subsidiary pursuant to any merger, consolidation or sale of
assets effected in accordance with Section 5.01; provided, however, that
no such payment may be made pursuant to this clause (vii) unless, after
giving pro forma effect to such transaction (and the Incurrence of any
Debt in connection with that transaction and the use of the proceeds of
that transaction), HoldCo 3 would be able to Incur $1.00 of additional
Debt under paragraph (a) of Section 4.09, without giving effect to the
last sentence of Section 4.09(a);
(viii) payments made to purchase, redeem, defease or otherwise
acquire or retire for value any Capital Stock or Subordinated Debt of
HoldCo 3 or any Capital Stock or Debt of any of its Restricted
Subsidiaries or any direct or indirect parent of HoldCo 3, pursuant to
provisions requiring any of such Persons to offer to purchase, redeem,
defease or otherwise acquire or retire for value such Capital Stock or
Debt upon the occurrence of a "change of control," as defined in the
charter provisions, agreements or instruments governing such Capital Stock
or Debt; provided, however, that SFC has made a Change of Control Offer
and has purchased all Notes tendered in connection with that Change of
Control Offer;
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(ix) dividends on HoldCo 3's Capital Stock (other than
Disqualified Capital Stock) or payments to any direct or indirect parent
of HoldCo 3 to pay dividends on its Capital Stock after the first
underwritten Equity Offering in an annual amount not to exceed 6.0% of the
gross proceeds (before deducting underwriting discounts and commissions
and other fees and expenses of the offering) received from shares of
Capital Stock (other than Disqualified Capital Stock of HoldCo 3) sold for
the account of the issuer of those shares (and not for the account of any
stockholder) in any underwritten Equity Offering; provided that in the
case of any such Equity Offering by any direct or indirect parent of
HoldCo 3, the net cash proceeds of such Equity Offering are contributed to
the common or non-redeemable preferred equity capital of HoldCo 3 or any
Wholly Owned Restricted Subsidiary;
(x) payments of dividends, distributions or other amounts by
HoldCo 3 to fund the payment by any direct or indirect parent of HoldCo 3
of administrative, legal, financial, accounting or other similar expenses
relating to such parent's direct or indirect ownership of HoldCo 3 and to
pay other corporate overhead expenses relating to such ownership interest,
including directors' fees, indemnifications and similar arrangements, so
long as such payments are fair and reasonable and are paid as and when
needed by any such direct or indirect parent of HoldCo 3;
(xi) payments of dividends, distributions or other amounts to
fund the repurchase, redemption or other acquisition or retirement for
value of any of HoldCo 3's or its direct or indirect parent's Equity
Interests or any Equity Interests of any Restricted Subsidiaries held by
any then-existing or former director, officer, employee, independent
contractor or consultant of HoldCo 3, its direct or indirect parent or any
Restricted Subsidiary or their respective assigns, estates or heirs;
provided, however, that the price paid for all repurchased, redeemed,
acquired or retired Equity Interests in all cases, other than as a result
of death or disability, does not exceed $1.0 million in the aggregate;
(xii) payments of fees and expenses incurred in connection
with the consummation of the offering of the Notes and the Senior Notes;
(xiii) the redemption, repurchase or other acquisition or
retirement of Subordinated Debt made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Refinancing Debt;
provided that such Refinancing Debt shall also constitute Subordinated
Debt;
(xiv) payments by HoldCo 3 under the terms of the Transaction
Documents as such documents are in effect on the date the Notes are first
issued or as amended in accordance with Section 4.14;
(xv) Investments in Unrestricted Subsidiaries that are made
with Excluded Proceeds;
(xvi) the redemption, repurchase or other acquisition or
retirement of Debt from Net Available Cash to the extent permitted under
Section 4.12;
(xvii) payments of dividends, distributions or other amounts
to fund the payment by SFC of interest on the Notes;
(xviii) the payment of a dividend or distribution from time to
time to Holdco 2 to fund the Permitted Dividend; and
(xix) payments of dividends, distributions or other amounts
for the redemption, repurchase or other acquisition or retirement of the
Notes to the extent permitted by Section 4.12;
provided, however, that no Default or Event of Default shall have occurred or be
continuing at the time of the payment or as a result of that payment.
In determining the aggregate amount of Restricted Payments made
subsequent to the date the Notes are first issued, amounts expended pursuant to
clauses (i), (vi) and (ix) shall be included in such calculation.
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The amount of all Restricted Payments (other than cash) shall be
the fair market value on the date of such Restricted Payment of the asset(s) or
securities proposed to be paid, transferred or issued by HoldCo 3 or such
Restricted Subsidiary, as the case may be, pursuant to such Restricted Payment.
The fair market value of any non-cash Restricted Payment shall be determined
conclusively by the Board of Directors of HoldCo 3 acting in good faith whose
Board Resolution with respect thereto shall be delivered to the Trustee.
(c) Notwithstanding the provisions of Section 4.10(a),
(i) during the Restricted Period, (x) HoldCo 3 shall not
make any Restricted Payment except as permitted by Section 4.10(b), and
(y) HoldCo 3 shall not declare or pay any dividend or make any other
distribution for the purpose of paying a dividend or distribution,
directly or indirectly, on shares of Common Stock other than the Permitted
Dividend; and
(ii) during the Interest Restricted Period, HoldCo 3 shall
not permit any of its Restricted Subsidiaries to make any Restricted
Payment except as provided in Section 4.10(b) (other than the Permitted
Dividend to the extent the gross proceeds from the offering of the Senior
Notes are contributed to OpCo as a capital contribution or used to
purchase additional shares of common stock of OpCo) if such Restricted
Payment would reduce the sum determined under Section 4.10(a)(iii), with
such determination being subject to clause (y) in the definition of
Available Cash, unless, prior to such Restricted Payment, such Restricted
Subsidiary shall have paid to HoldCo 3, or reserved for payment to HoldCo
3, a cash dividend or distribution equal to the cash interest that will be
due and payable on both the Notes on the next Interest Payment Date and
the Senior Notes on the next interest payment date therefor, and, after
such cash interest has been paid or reserved, any such Restricted Payment
(A) must comply with Section 4.14 if paid to an Affiliate of HoldCo 3
(excluding dividends paid by HoldCo 3) and (B) may not be used for the
payment of any dividend or distribution, directly or indirectly, on, or
the repurchase of, shares of Common Stock.
(d) During the Restricted Period, HoldCo 3 shall not make any
investment described in clause (8) of the definition of Permitted Investment.
SECTION 4.11. LIENS.
HoldCo 3 shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, Incur or suffer to exist any Lien (other than
Permitted Liens or Liens securing Senior Debt) upon any of its property
(including Capital Stock of a Restricted Subsidiary), whether owned at the date
the Notes are first issued or thereafter acquired, or any interest therein or
any income or profits therefrom, unless:
(a) if such Lien secures Senior Subordinated Debt, the Notes or
the Guarantees are secured on an equal and ratable basis with such Debt for so
long as such Senior Subordinated Debt is secured by such Lien; and
(b) if such Lien secures Subordinated Debt, the Lien securing such
Subordinated Debt will be subordinated and junior to a Lien securing the Notes
or the Guarantees, as the case may be, with the same relative priority as such
Debt has with respect to the Notes or the Guarantees.
SECTION 4.12. ASSET SALES.
(a) HoldCo 3 shall not, and shall not permit any of its Restricted
Subsidiaries to, make an Asset Sale unless:
(i) HoldCo 3 or that Restricted Subsidiary receives
consideration, including as to the value of all non-cash consideration, at
the time of the Asset Sale at least equal to the fair market value, as
determined in good faith by HoldCo 3's senior management or Board of
Directors of the shares, property or assets being disposed of in the Asset
Sale;
(ii) at least 75% of the consideration received by HoldCo 3
or its Restricted Subsidiary, as the case may be, from the Asset Sale is
in the form of cash or Cash Equivalents; and
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(iii) an amount equal to 100% of the Net Available Cash from
the Asset Sale is applied by HoldCo 3 or the Restricted Subsidiary, as the
case may be,
(A) first, within one year from the receipt of that Net
Available Cash and solely at HoldCo 3's election or as required by
the terms of the Senior Credit Facilities or the Senior Notes
Indenture either:
(1) to
(x) invest in or acquire any one or more
Related Businesses,
(y) make capital expenditures or
acquisitions of other assets, in each case, used
or useful in a Related Business, or
(z) invest in or acquire properties or
assets that replace the properties and assets
disposed of in the Asset Sale; or
(2) to prepay, repay or purchase indebtedness
under the Senior Credit Facilities or other Senior Debt of
HoldCo 3 (including the Senior Notes) or a Wholly Owned
Restricted Subsidiary (other than Debt owed to HoldCo 3);
(B) second, within 45 days after the later of the
application of Net Available Cash in accordance with clause (A) and
the date that is one year following the receipt of the Net Available
Cash, to the extent of the balance of that Net Available Cash after
application in accordance with clause (A), to make an offer to
purchase the Senior Notes and other pari passu Debt, to the extent
required pursuant to the terms of the Senior Notes Indenture or that
pari passu Debt, pro rata at 100% of the tendered principal amount
of the other pari passu Debt or 100% of the accreted value of the
pari passu Debt so tendered if that pari passu Debt was issued at a
discount, plus accrued and unpaid interest, if any, on the Notes and
the pari passu Debt to the date of purchase; and
(C) third within 45 days after the application of Net
Available Cash in accordance with clause (B), to the extent of the
balance of the Net Available Cash after application in accordance
with clause (B), to make an Asset Sale Offer (either directly or by
way of a dividend or distribution to SFC in order for SFC to make
such Asset Sale Offer) pursuant to Section 3.09.
(b) HoldCo 3 or its Restricted Subsidiaries will cause the balance
of the Net Available Cash after application in accordance with clauses (A), (B)
and (C) above to be used by HoldCo 3 or its Restricted Subsidiaries in any
manner not otherwise prohibited by this Indenture. Notwithstanding the foregoing
provisions, HoldCo 3 and its Restricted Subsidiaries shall not be required to
apply any Net Available Cash in accordance herewith until the aggregate Net
Available Cash from all Asset Sales following the date the Notes are first
issued exceeds $15.0 million. Thereafter, once HoldCo 3 or its Restricted
Subsidiaries accumulates an additional aggregate $15.0 million of Net Available
Cash from all Asset Sales, and, after application of the additional aggregate
$15.0 million of Net Available Cash by HoldCo 3 as provided in clauses (A) and
(B), either HoldCo 3 or SFC shall make an offer for Notes pursuant to this
Section 4.12 by applying the Net Available Cash in excess of $15.0 million as
required pursuant to clause (a)(iii)(C) above.
(c) Solely for the purposes of clause (a)(ii) above of this Section
4.12 and the definition of "Net Available Cash," the following will be deemed to
be cash:
(i) the assumption by the transferee in connection with the
Asset Sale pursuant to a customary novation agreement that releases HoldCo
3 or any of its Restricted Subsidiaries, as the case may be, from further
liability with respect to Debt of HoldCo 3 or any Restricted Subsidiary,
other than contingent Debt and Debt that is by its terms subordinated to
the Notes or to any Subsidiary Guarantee, in
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which case HoldCo 3 will, without further action, be deemed to have
applied the assumed Debt in accordance with clause (a)(iii)(A) above, and
(ii) securities received by HoldCo 3 or any Restricted
Subsidiary of HoldCo 3 from the transferee that are converted within 60
days into cash or Cash Equivalents.
(d) In the event of an Asset Sale that requires the purchase of
Notes pursuant to clause (a)(iii)(C) above of this Section 4.12, either SFC or
HoldCo 3 will be required to purchase Notes tendered pursuant to an offer by SFC
or HoldCo 3 for the Notes in accordance with Section 3.09 hereof. If the
aggregate purchase price of the Notes tendered pursuant to the Asset Sale Offer
is less than the Net Available Cash allotted to the purchase of the Notes,
HoldCo 3 may use the remaining Net Available Cash for any purpose not prohibited
by this Indenture, including the repurchase of any subordinated notes required
upon an Asset Sale by the indenture pursuant to which such subordinated notes
were issued. Upon the consummation of the purchase of Notes properly tendered in
response to the Asset Sale Offer, the amount of Net Available Cash subject to
future offers to purchase will be deemed to be reset to zero.
(e) Notwithstanding anything in this Section 4.12 to the contrary,
to the extent an Asset Sale hereunder also constitutes an Asset Sale under the
OpCo Senior Indenture, the OpCo Subordinated Indenture or the Senior Notes
Indenture, an Asset Sale Offer is only required to be made out of the proceeds
which remain after application of the proceeds in accordance with the OpCo
Senior Indenture, the OpCo Subordinated Indenture and the Senior Notes Indenture
and to the extent that such remaining proceeds may be paid as a dividend or
distribution to SFC without violation of state surplus laws and the terms of the
OpCo Senior Indenture, the OpCo Subordinated Indenture, the Senior Notes
Indenture and the Senior Credit Facilities.
(f) SFC and HoldCo 3 shall comply with the requirements of Rule
14e-1 of the Exchange Act and, to the extent applicable, any other securities
laws or regulations in connection with the repurchase of Notes pursuant to this
Indenture. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, SFC and HoldCo 3 shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Indenture by virtue of
complying with those laws and regulations.
SECTION 4.13. RESTRICTIONS ON DISTRIBUTIONS FROM SUBSIDIARIES.
SFC shall not, and shall not permit any of its Subsidiaries to,
create or permit to exist or become effective any consensual encumbrance or
restriction on the ability of any such Subsidiary to:
(a) pay dividends, in cash or otherwise, or make any other
distributions on its Capital Stock or pay any Debt or other obligation owed to
SFC, Intermediary Sub, HoldCo 2, HoldCo 3 or any Restricted Subsidiary;
(b) make any loans or advances to SFC, Intermediary Sub, HoldCo 2,
HoldCo 3 or any Restricted Subsidiary; or
(c) transfer any of its property or assets to SFC, Intermediary
Sub, HoldCo 2, HoldCo 3 or any Restricted Subsidiary.
The foregoing limitations will not apply to:
(i) any encumbrance or restriction pursuant to an agreement in
effect at or entered into on the date the Notes are first issued, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof; provided that such
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings are no more restrictive than
those contained in such agreements as in effect on the date the Notes are
first issued, as determined in good faith by the senior management or
Board of Directors of SFC;
(ii) any encumbrance or restriction existing under or by
reason of the Senior Credit Facilities, the Senior Notes Indenture, the
Guarantees, the OpCo Senior Indenture, or the OpCo
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Subordinated Indenture and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof; provided that such amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
are not materially more restrictive, taken as a whole, with respect to
dividend and other payment restrictions than those contained in the Senior
Credit Facilities, the Senior Notes Indenture, the Guarantees, the OpCo
Senior Indenture, the OpCo Senior Subordinated Senior Notes Indenture, as
in effect on the date the Notes are first issued;
(iii) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any Debt
Incurred or Preferred Stock issued by such Restricted Subsidiary on or
prior to the date on which such Restricted Subsidiary became a Restricted
Subsidiary or was acquired by HoldCo 3 or any Restricted Subsidiary and
outstanding on such date, other than Debt Incurred or Preferred Stock
issued 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 of HoldCo 3 or was acquired by HoldCo 3 or any
Restricted Subsidiary;
(iv) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement evidencing Debt Incurred or
Preferred Stock issued without violation of this Indenture or effecting a
refinancing of Debt Incurred or Preferred Stock issued pursuant to an
agreement referred to in clauses (i), (ii), (iii) or this clause (iv)
contained in any amendment to an agreement referred to in clauses (i),
(ii), (iii) or this clause (iv); provided, however, that the encumbrances
and restrictions with respect to such Restricted Subsidiary contained in
any such agreement, refinancing agreement or amendment, taken as a whole,
are not materially less favorable to the Holders of the Notes, as
determined in good faith by the senior management or Board of Directors of
SFC, than encumbrances and restrictions with respect to that Restricted
Subsidiary contained in agreements in effect at, or entered into on, the
date the Notes are first issued; and
(v) in the case of clause (c) of the first paragraph of this
Section 4.13, any encumbrance or restriction:
(A) that restricts in a customary manner the subletting,
assignment or transfer of any property or asset that is subject to a
lease, license, conveyance or contract or similar property or asset
or the assignment of any such lease, license or other contract;
(B) by virtue of any transfer of, agreement to transfer,
option or right with respect to, or Lien on, any property or assets
of HoldCo 3 or any Restricted Subsidiary not otherwise prohibited by
this Indenture;
(C) that is included in a licensing agreement to the
extent such restrictions limit the transfer of the property subject
to such licensing agreement;
(D) arising or agreed to in the ordinary course of
business and that does not, individually or in the aggregate,
detract from the value of property or assets of HoldCo 3 or any of
its Restricted Subsidiaries in any manner material to HoldCo 3 or
any such Restricted Subsidiary as determined in good faith by senior
management or the Board of Directors of HoldCo 3; or
(E) contained in security agreements, mortgages or
similar documents securing Debt of a Restricted Subsidiary incurred
in accordance with this Indenture to the extent those encumbrances
or restrictions restrict the transfer of the property subject to
such security agreements;
(vi) any restriction with respect to a Restricted Subsidiary
or any of its properties or assets imposed pursuant to an agreement
entered into for the sale or disposition of all or substantially all the
Capital Stock or assets of that Restricted Subsidiary (whether by stock
sale, asset sale, merger, consolidation or otherwise) pending the closing
of such sale or disposition or any portion of the purchase price from an
Asset Sale placed in escrow, whether as a reserve for adjustment of the
purchase price, for satisfaction of indemnities in respect of such Asset
Sale or otherwise in connection with that Asset Sale;
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(vii) encumbrances or restrictions arising or existing by
reason of applicable law, regulation or order;
(viii) any encumbrance or restriction under Capitalized Lease
Obligations and purchase money obligations for property leased or acquired
in the ordinary course of business that impose encumbrances or
restrictions of the nature described in clause (c) of the first paragraph
of this Section 4.13 on the property so leased or acquired;
(ix) customary provisions with respect to the distribution of
assets or property in joint venture agreements; and
(x) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary course
of business.
SECTION 4.14. AFFILIATE TRANSACTIONS.
HoldCo 3 shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions, including, without limitation,
the purchase, sale, lease, contribution or exchange of any property or the
rendering of any service, with any of its or any of its Restricted Subsidiaries'
Affiliates (excluding transactions between HoldCo 3 and a Wholly Owned
Restricted Subsidiary or between Wholly Owned Restricted Subsidiaries) (an
"AFFILIATE TRANSACTION"), other than Affiliate Transactions on terms that are no
less favorable than those that might reasonably have been obtained in a
comparable transaction on an arm's-length basis from a Person that is not an
Affiliate; provided, however, that for a transaction or series of related
transactions involving value of $10.0 million or more, such determination will
be made in good faith by a majority of members of the Board of Directors of
HoldCo 3 and by a majority of the disinterested members of the Board of
Directors of HoldCo 3, if any; provided, further, however, that for a
transaction or series of related transactions involving value of $25.0 million
or more, HoldCo 3 obtains a written opinion from an Independent Financial
Advisor to the effect that the consideration to be paid or received in
connection with such transaction or series of related transactions is fair, from
a financial point of view, to HoldCo 3 or such Restricted Subsidiary.
The foregoing restrictions will not apply to:
(a) reasonable and customary directors' fees, indemnification and
similar arrangements and payments thereunder;
(b) any obligations of HoldCo 3 under any employment,
noncompetition or confidentiality agreement with any officer or employee of
HoldCo 3, as in effect on the date the Notes are first issued;
(c) any Restricted Payment permitted to be made pursuant to
Section 4.10 other than Restricted Payments to Affiliates during the Interest
Restricted Period as provided in Section 4.10(c)(ii).
(d) 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 and other fair and
reasonable fees, compensation, benefits and indemnities paid or entered into by
HoldCo 3 or its Restricted Subsidiaries to or with officers, directors or
employees of HoldCo 3 and its Restricted Subsidiaries approved by the Board of
Directors of HoldCo 3;
(e) loans or advances to officers, directors or employees in the
ordinary course of business of HoldCo 3 or any of its Restricted Subsidiaries;
provided that such loans or advances do not exceed $2.0 million outstanding at
any one time;
(f) payments (including, without limitation, fees payable to and
expenses of Xxxxx Muse and ConAgra Foods) made pursuant to the Transaction
Documents as in effect on the date the Notes are first issued or any amendments
thereto; provided that the terms, taken as a whole, of any such amendment of any
of the foregoing agreements are not otherwise disadvantageous to the Holders of
the Notes in any material respect;
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(g) the existence of, or the performance by HoldCo 3 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, to which it is a party as of the date the Notes are first
issued and any similar agreements which it may enter into thereafter; provided,
however, that the existence of, or the performance by HoldCo 3 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 date
the Notes are first issued shall only be permitted by this clause (g) to the
extent that the terms, taken as a whole, of any such amendment or new agreement
are not otherwise disadvantageous to the Holders of the Notes in any material
respect;
(h) 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 this Indenture which are fair to
HoldCo 3 or its Restricted Subsidiaries, in the reasonable determination of the
senior management and of the Board of Directors of HoldCo 3, or are on terms,
taken as a whole, at least as favorable as might reasonably have been obtained
at such time from an unaffiliated party;
(i) any agreement as in effect as of the date the Notes are first
issued or any amendment thereto, so long as any such amendment, taken as a
whole, is not disadvantageous to the Holders of the Notes in any material
respect, or any transaction contemplated thereby;
(j) any contributions of capital to one or more Wholly Owned
Restricted Subsidiaries of HoldCo 3 or any purchases of Equity Interests of
HoldCo 3 by its Affiliates; and
(k) any purchases by HoldCo 3's Affiliates of Debt of HoldCo 3 or
any of its Restricted Subsidiaries offered to Persons who are not Affiliates;
provided that such purchases must be on the same terms and conditions as offered
to Persons who are not Affiliates.
SECTION 4.15. LAYERED DEBT.
HoldCo 3 shall not, and shall not permit any HoldCo 3 Subsidiary
Guarantor to, Incur, directly or indirectly, any Debt that is subordinate or
junior in right of payment to any Senior Debt unless such Debt is Senior
Subordinated Debt or is expressly subordinated in right of payment to, or ranks
pari passu with, the Notes or the Guarantees, as the case may be.
SECTION 4.16. ISSUANCE OR SALE OF CAPITAL STOCK OF RESTRICTED SUBSIDIARIES.
HoldCo 3 shall not, directly or indirectly:
(a) sell or otherwise dispose of any shares of Capital Stock of a
Restricted Subsidiary (or permit any Restricted Subsidiary to do the same); or
(b) permit any Restricted Subsidiary to, directly or indirectly,
issue or sell or otherwise dispose of any shares of its Capital Stock;
other than, in the case of either (a) or (b):
(i) directors' qualifying shares,
(ii) to HoldCo 3 or a Wholly Owned Restricted Subsidiary, or
(iii) a disposition of 100% of the shares of Capital Stock
of such Restricted Subsidiary; provided, however, that, in the case of
this clause (iii),
(A) such disposition is effected in compliance with
Section 4.12; and
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(B) upon consummation of such disposition and execution
and delivery of a supplemental indenture, such Restricted Subsidiary
shall be released from any Subsidiary Guarantee previously made by
such Restricted Subsidiary; and
(iv) the issuance by a Restricted Subsidiary of Preferred
Stock permitted under paragraph (a) of Section 4.09.
SECTION 4.17. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
HoldCo 3's Board of Directors may designate any of its
Subsidiaries, including any newly formed Subsidiary or any Person that will
become a Subsidiary by way of acquisition, to be an Unrestricted Subsidiary if
that designation would not cause a Default. If any of HoldCo 3's Restricted
Subsidiaries is designated as an Unrestricted Subsidiary, the aggregate fair
market value of all outstanding Investments owned by HoldCo 3 and its Restricted
Subsidiaries in the newly designated Unrestricted Subsidiary will be deemed to
be an Investment made as of the time of that designation and will either reduce
the amount available for Restricted Payments under Section 4.10(a) or Section
4.10(b) or reduce the amount available for future Investments under one or more
clauses of the definition of "Permitted Investments," as HoldCo 3 determines in
its sole discretion. The designation of such a Subsidiary or Person as an
"Unrestricted Subsidiary" will only be permitted if, in the case of a Restricted
Subsidiary, the deemed Investment would be permitted at the time the Restricted
Subsidiary is designated as an Unrestricted Subsidiary and, in any case, if that
Subsidiary or Person otherwise satisfies the requirements set forth in the
definition of "Unrestricted Subsidiary." HoldCo 3's Board of Directors may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary if that
designation would not cause a Default.
SECTION 4.18. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder shall
have the right to require SFC to repurchase all or any part (equal to $1.00 or
an integral multiple thereof) of such Holder's Notes pursuant to the offer
described below (the "CHANGE OF CONTROL OFFER") at a purchase price, in cash
(the "CHANGE OF CONTROL PURCHASE PRICE"), equal to (i) during the Restricted
Period, 101% of the aggregate principal amount of Notes repurchased, or (ii)
after the Restricted Period, 100% of the aggregate principal amount of Notes
repurchased, in each case, plus accrued and unpaid interest and Special
Interest, if any, on the Notes repurchased, to, but excluding, the Change of
Control Payment Date (as defined below) (subject to the right of Holders on the
relevant record date to receive interest to, but excluding, the Change of
Control Payment Date).
Within 90 days following any Change of Control Effective Date,
unless SFC has mailed a redemption notice with respect to all of the outstanding
Notes in accordance with Section 3.03, SFC shall:
(i) send, by first-class mail, with a copy to the Trustee, to
each Holder, at such Holder's address appearing in the securities register
maintained in respect of the Notes by the Registrar (the "SECURITY
REGISTER"), a notice (a "CHANGE OF CONTROL NOTICE") stating:
(A) that a Change of Control has occurred and a Change
of Control Offer is being made pursuant to this Section 4.18 and
that all Notes timely tendered will be accepted for payment;
(B) the Change of Control Purchase Price and the
purchase date, which shall be, subject to any contrary requirements
of applicable law, a Business Day no earlier than 30 days and no
later than 60 days from the date such notice is mailed (the "CHANGE
OF CONTROL PAYMENT DATE");
(C) the circumstances and relevant facts regarding the
Change of Control;
(D) the procedures that Holders must follow in order to
tender their Notes (or portions thereof) for payment, and the
procedures that Holders must follow in order to withdraw an election
to tender Notes (or portions thereof) for payment;
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(E) the Holder's right to require SFC to purchase the
Notes;
(F) the name and address of each Paying Agent and
Conversion Agent;
(G) the then effective Conversion Rate and any
adjustments to the Conversion Rate resulting from such Change of
Control;
(H) that Notes as to which a Change of Control
Repurchase Notice has been given may be converted into Common Stock
pursuant to Article 14 of this Indenture only to the extent that the
Change of Control Repurchase Notice has been withdrawn in accordance
with the terms of this Indenture;
(I) the procedures for withdrawing a Change of Control
Repurchase Notice;
(J) that, unless SFC fails to pay such Change of Control
Purchase Price, Notes covered by any Change of Control Repurchase
Notice will cease to be outstanding and interest, if any, and
Special Interest, if any, will cease to accrue on and after the
Change of Control Payment Date; and
(K) the CUSIP number of the Notes.
At SFC's request, the Trustee shall give such Change of Control Notice in SFC's
name and at SFC's expense; provided, that, in all cases, the text of such Change
of Control Notice shall be prepared by SFC. If any of the Notes is in the form
of a Global Note, then SFC shall modify such notice to the extent necessary to
accord with the Applicable Procedures relating to the purchase of Global Notes.
(b) A Holder may exercise its rights specified in Section 4.18(a)
upon delivery of an executed "Option of Holder to Elect Purchase" contained in
Exhibit A by letter, overnight courier, hand delivery, or facsimile transmission
of the exercise of such rights (a "CHANGE OF CONTROL REPURCHASE NOTICE") to SFC
or any Paying Agent at any time prior to the close of business on the Business
Day next preceding the Change of Control Payment Date, subject to extension to
comply with applicable law.
(i) The Change of Control Repurchase Notice shall state: (A)
the certificate number (if such Note is held in certificated form) of the
Note which the Holder will deliver to be purchased (or, if the Note is a
Global Note, any other items required to comply with the Applicable
Procedures), (B) the portion of the principal amount of the Note which the
Holder will deliver to be purchased and (C) that such Note shall be
purchased as of the Change of Control Payment Date pursuant to the terms
and conditions specified in the Notes and in this Indenture.
(ii) The delivery of a Note for which a Change of Control
Repurchase Notice has been timely delivered to any Paying Agent and not
validly withdrawn prior to the Change of Control Payment Date (together
with all necessary endorsements) at the office of such Paying Agent shall
be a condition to the receipt by the Holder of the Change of Control
Purchase Price therefor.
(iii) SFC shall only be obliged to purchase, pursuant to this
Section 4.18, a portion of a Note if the principal amount of such portion
is $1.00 or an integral multiple thereof (provisions of this Indenture
that apply to the purchase of all of a Note also apply to the purchase of
such portion of such Note).
(iv) Notwithstanding anything herein to the contrary, any
Holder delivering to a Paying Agent a Change of Control Repurchase Notice
contemplated by this Section 4.18(b) shall have the right to withdraw such
Change of Control Repurchase Notice in whole or in a portion thereof that
is a principal amount of $1.00 or in an integral multiple thereof at any
time prior to the close of business on the Business Day prior to the
Change of Control Payment Date by delivery of a written notice of
withdrawal to a Paying Agent in accordance with Section 4.19.
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(v) A Paying Agent shall promptly notify SFC of the receipt by
it of any Change of Control Repurchase Notice or written withdrawal
thereof.
(vi) Anything herein to the contrary notwithstanding, in the
case of Global Notes, any Change of Control Repurchase Notice shall be
delivered or withdrawn and such Notes shall be surrendered or delivered
for purchase in accordance with the Applicable Procedures.
SECTION 4.19. EFFECT OF CHANGE OF CONTROL REPURCHASE NOTICE.
(a) Upon receipt by any Paying Agent of a properly completed
Change of Control Repurchase Notice from a Holder, the Holder of the Note in
respect of which such Change of Control Repurchase Notice was given shall
(unless such Change of Control Repurchase Notice is withdrawn as specified in
Section 4.19(b)) be entitled to receive the Change of Control Purchase Price
with respect to such Note. Such Change of Control Purchase Price shall be paid
to such Holder promptly following the later of (i) the Change of Control Payment
Date (provided that the conditions in Section 4.18 have been satisfied) and (ii)
the time of delivery of such Note to a Paying Agent by the Holder thereof in the
manner required by Section 4.18(b). Notes in respect of which a Change of
Control Repurchase Notice has been given by the Holder thereof may not be
converted into shares of Common Stock pursuant to Article 14 on or after the
date of the delivery of such Change of Control Repurchase Notice unless such
Change of Control Repurchase Notice has first been validly withdrawn in
accordance with Section 4.19(b) with respect to the Notes to be converted.
(b) A Change of Control Repurchase Notice may be withdrawn by
means of a written notice (which may be delivered by mail, overnight courier,
hand delivery or facsimile transmission) of withdrawal delivered by the Holder
to a Paying Agent at any time prior to the close of business on the Business Day
immediately prior to the Change of Control Payment Date, specifying (i) the
principal amount of the Note or portion thereof (which must be a principal
amount of $1.00 or an integral multiple thereof) with respect to which such
notice of withdrawal is being submitted, (ii) if certificated Notes have been
issued, the certificate number of the Note being withdrawn in whole or in
withdrawable part and (3) the portion of the principal amount of the Note that
will remain subject to the Change of Control Repurchase Notice, which portion
must be a principal amount of $1.00 or an integral multiple thereof.
SECTION 4.20. DEPOSIT OF CHANGE OF CONTROL PURCHASE PRICE.
(a) On or prior to 11:00 a.m. New York City time on the Change of
Control Payment Date, SFC shall deposit with the Trustee or with a Paying Agent
(other than SFC or an Affiliate of SFC) an amount of money (in immediately
available funds if deposited on such Change of Control Payment Date), sufficient
to pay the aggregate Change of Control Purchase Price of all the Notes or
portions thereof that are to be purchased on such Change of Control Payment
Date; provided that such deposit shall be made in a manner such that the Trustee
or a Paying Agent shall have immediately available funds on the Change of
Control Payment Date.
(b) If a Paying Agent or the Trustee holds, in accordance with the
terms hereof, money sufficient to pay the Change of Control Purchase Price of
any Note for which a Change of Control Repurchase Notice has been tendered and
not withdrawn in accordance with this Indenture then, on the Change of Control
Payment Date, such Note will cease to be outstanding, whether or not the Note is
delivered to a Paying Agent or the Trustee, and interest and Special Interest,
if any, shall accrue up to, but excluding, the Change of Control Payment Date,
and the rights of the Holder in respect of the Note shall terminate on the
Change of Control Payment Date (other than the right to receive the Change of
Control Purchase Price as aforesaid).
(c) No Notes may be purchased by SFC at the option of Holders upon
a Change of Control if there has occurred and is continuing an Event of Default
with respect to the Notes, other than a Default in the payment of the Change of
Control Purchase Price with respect to the Notes. A Paying Agent will promptly
return to the respective Holders thereof any Notes (i) with respect to which a
Change of Control Repurchase Notice has been withdrawn in compliance with this
Indenture, or (ii) held by it during the continuance of an Event of Default
(other than a failure to pay the Change of Control Purchase Price). Upon such
return of the Notes in accordance with clause (ii) of the preceding sentence,
the Change of Control Repurchase Notice with respect thereto shall be deemed to
have been withdrawn.
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(d) If a Change of Control Payment Date is on or after a Regular
Record Date but on or prior to the related Interest Payment Date, then any
accrued and unpaid interest and Special Interest, if any, shall be paid to the
Person in whose name a Note was registered at the close of business on such
Regular Record Date, and no additional interest will be payable to Holders who
tender Notes pursuant to the Change of Control Offer.
SECTION 4.21. REPAYMENT TO SFC.
To the extent that the aggregate amount of cash deposited by SFC
pursuant to Section 4.20 exceeds the aggregate Change of Control Purchase Price
of the Notes or portions thereof that SFC is obligated to purchase, then
promptly after the Change of Control Payment Date the Trustee or a Paying Agent,
as the case may be, shall return any such excess cash to SFC.
SECTION 4.22. NOTES PURCHASED IN PART.
Any Note that is to be purchased only in part shall be surrendered at
the office of a Paying Agent, and promptly after the Change of Control Payment
Date, SFC shall execute and the Trustee shall authenticate and deliver to the
Holder of such Note, without service charge, a new Note or Notes, of such
authorized denomination or denominations as may be requested by such Holder
(which must be equal to $1.00 principal amount or any integral thereof), in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Note so surrendered that is not purchased.
SECTION 4.23. COMPLIANCE WITH SECURITIES LAWS UPON PURCHASE OF NOTES.
In connection with any offer to purchase of Notes under Section 4.18,
SFC shall (a) comply with Rule 13e-4 and Rule 14e-1 (or any successor to either
such Rule), and any other tender offer rules, if applicable, under the Exchange
Act, (b) file the related Schedule TO (or any successor or similar schedule,
form or report) if required under the Exchange Act, and (c) otherwise comply
with all federal and state securities laws in connection with such offer to
purchase or purchase of Notes, all so as to permit the rights of the Holders and
obligations of SFC under Section 4.18 to be exercised in the time and in the
manner specified therein. To the extent that compliance with any such laws,
rules and regulations would result in a conflict with any of the terms hereof,
this Indenture is hereby modified to the extent required for SFC in accordance
with Section 2.11 to comply with such laws, rules and regulations.
SECTION 4.24. PURCHASE OF NOTES IN OPEN MARKET.
SFC shall surrender any Note purchased by SFC pursuant to this
Article 4 to the Trustee for cancellation in accordance with Section 2.11. Any
Notes surrendered to the Trustee for cancellation may not be reissued or resold
by SFC and will be canceled promptly in accordance with Section 2.11. Except
during the Restricted Period, SFC may repurchase Notes in open market and
negotiated transactions.
SECTION 4.25. BUSINESS ACTIVITIES.
HoldCo 3 shall not engage in any business other than the holding
of Capital Stock of OpCo, and shall not permit any Restricted Subsidiary to,
directly or indirectly, engage in any business other than a Related Business.
During the Restricted Period, HoldCo 3 shall not make any business or asset
acquisitions.
SECTION 4.26. GUARANTEES OF DEBT BY RESTRICTED SUBSIDIARIES AND SFC
SUBSIDIARIES.
(a) HoldCo 3 shall not permit any Restricted Subsidiary to
guarantee the payment of any of HoldCo 3's Debt (except for Senior Debt of
HoldCo 3) unless:
(i) such Restricted Subsidiary simultaneously executes and
delivers a supplemental indenture to this Indenture pursuant to which it
becomes a HoldCo 3 Subsidiary Guarantor; except that (x) if such Debt of
HoldCo 3 is by its express terms senior subordinated debt, any such
Guarantee by such Restricted Subsidiary with respect to the Notes will be
pari passu in right of payment to HoldCo 3's Guarantee with respect to the
Notes, and (y) if such Debt of HoldCo 3 is by its express terms
subordinated
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in right of payment to the Notes or the Guarantee of HoldCo 3, any such
guarantee of such Restricted Subsidiary with respect to such Debt of
HoldCo 3 will be subordinated in right of payment to such Restricted
Subsidiary's Guarantee with respect to the Notes substantially to the same
extent as such Debt of HoldCo 3 is subordinated to the Notes or the
Guarantee of HoldCo 3;
(ii) such Restricted Subsidiary waives and shall not in any
manner whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against HoldCo
3 as a result of any payment by such Restricted Subsidiary under its
Guarantee of the Notes; and
(iii) such Restricted Subsidiary shall deliver to the Trustee
an Opinion of Counsel to the effect that:
(A) such Guarantee of the Notes has been duly executed
and authorized; and
(B) such Guarantee of the Notes constitutes a valid,
binding and enforceable obligation of such Restricted Subsidiary,
except insofar as enforcement thereof may be limited by bankruptcy,
insolvency or similar laws (including, without limitation, all laws
relating to fraudulent transfers) and except insofar as enforcement
thereof is subject to general principles of equity.
In addition, any Guarantee by a Restricted Subsidiary will be
automatically and unconditionally released and discharged if HoldCo 3 designates
such Restricted Subsidiary as an Unrestricted Subsidiary in accordance with this
Indenture.
(b) HoldCo 3 shall not permit any Restricted Subsidiary to guarantee
the payment of any of the Parent's Debt unless:
(i) such Subsidiary simultaneously executes and delivers a
guarantee of payment of HoldCo 3's obligations under the Guarantee of
HoldCo 3 with respect to the Notes; such Subsidiary's guarantee of the
Parent's Debt will be subordinated in right of payment to such
Subsidiary's guarantee of such HoldCo 3 Guarantee to the same extent that
the HoldCo 3 Guarantee is subordinated to Senior Debt of HoldCo 3; and if
such Parent Debt is Debt of SFC that is subordinated in right of payment
to the Notes, such Subsidiary's guarantee of such Parent Debt will be
subordinated in right of payment to the Notes to the same extent that the
Notes are subordinated to Senior Debt of SFC;
(ii) such Subsidiary waives and shall not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against HoldCo
3 as a result of any payment by such Subsidiary under its guarantee of
HoldCo3's Guarantee of the Notes; and
(iii) such Subsidiary shall deliver to the Trustee an Opinion
of Counsel to the effect that:
(A) such Guarantee of HoldCo 3's Guarantee has been duly
executed and authorized; and
(B) such Guarantee of HoldCo 3's Guarantee constitutes a
valid, binding and enforceable obligation of such Subsidiary, except
insofar as enforcement thereof may be limited by bankruptcy,
insolvency or similar laws (including, without limitation, all laws
relating to fraudulent transfers) and except insofar as enforcement
thereof is subject to general principles of equity.
(c) HoldCo 3 shall not guarantee the payment of any Parent's Debt
(other than any Guarantee of the Notes) unless such guarantee is subordinate in
right of payment to HoldCo 3's Guarantee of the Notes.
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SECTION 4.27. SELLER NOTE.
(a) Notwithstanding anything to the contrary contained in Section
4.07 or Article 5 hereof, SFC and HoldCo 3 shall not, and shall not permit any
Restricted Subsidiary to, consolidate with or merge with or into the issuer of
or other obligor under (or any guarantor of) the Seller Note or otherwise
assume, directly or indirectly, the Debt represented by the Seller Note.
(b) SFC will not permit HoldCo 2 to be or become the holder of any
Debt as to which HoldCo 3 is an obligor.
ARTICLE 5.
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION AND SALE OF ASSETS.
(a) SFC shall not, in a single transaction or a series of related
transactions, consolidate with or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its assets
determined on a consolidated basis to another Person or adopt a plan of
liquidation unless:
(i) either
(A) SFC is the Surviving Person; or
(B) the Person, if other than SFC, formed by such
consolidation or into which SFC is merged or the Person that
acquires by conveyance, transfer or lease the properties and
assets of SFC substantially as an entirety or in the case of a
plan of liquidation, the Person to which assets of SFC have been
transferred, will be a corporation, partnership or limited
liability company organized and existing under the laws of the
United States or any State of the United States or the District of
Columbia; provided, however, that if the Person formed by such
consolidation or into which SFC is merged or the Person that
acquires by conveyance, transfer or lease the properties and
assets of SFC substantially as an entirety is a partnership or
limited liability company, SFC or such Surviving Person shall
cause a Subsidiary that is a corporation to become a co-obligor on
the Notes;
(ii) such Surviving Person, if other than SFC, assumes all of
the obligations of SFC under the Notes and this Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee;
(iii) immediately after giving effect to that transaction and
the use of the proceeds from that transaction, on a pro forma basis,
including giving effect to any Debt Incurred or anticipated to be Incurred
in connection with that transaction and the use of the proceeds from that
transaction, no Default or Event of Default shall have occurred and be
continuing; and
(iv) SFC delivers to the Trustee prior to the consummation of
the proposed transaction an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger or transfer complies
with this Indenture and that all conditions precedent in this Indenture
relating to such transaction have been satisfied.
(b) For purposes of Section 5.01(a), the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of related
transactions) of all or substantially all of the properties and assets of one or
more Subsidiaries, the Capital Stock of which constitutes all or substantially
all of the properties or assets of SFC, will be deemed to be the transfer of all
or substantially all of the properties and assets of SFC. Notwithstanding the
foregoing clauses (a)(ii) and (iii),
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(i) any Subsidiary may consolidate with, merge into or
transfer all or part of its properties and assets to SFC, and
(ii) SFC may merge with one of its Affiliates that is
organized solely for the purpose of reorganizing SFC in another
jurisdiction in the United States to realize tax or other benefits.
(c) HoldCo 3 shall not, in a single transaction or a series of
related transactions, consolidate with or merge with or into, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
assets determined on a consolidated basis to another Person or adopt a plan of
liquidation unless:
(i) either
(A) HoldCo 3 is the Surviving Person; or
(B) the Person, if other than HoldCo 3, formed by such
consolidation or into which HoldCo 3 is merged or the Person that
acquires by conveyance, transfer or lease the properties and assets
of HoldCo 3 substantially as an entirety or in the case of a plan of
liquidation, the Person to which assets of HoldCo 3 have been
transferred, will be a corporation, partnership or limited liability
company organized and existing under the laws of the United States
or any State of the United States or the District of Columbia;
provided, however, that if the Person formed by such consolidation
or into which HoldCo 3 is merged or the Person that acquires by
conveyance, transfer or lease the properties and assets of HoldCo 3
substantially as an entirety is a partnership or limited liability
company, HoldCo 3 or such Surviving Person shall cause a Subsidiary
that is a corporation to become a co-obligor on the Notes;
(ii) such Surviving Person, if other than SFC, assumes all of
the obligations of HoldCo 3 under the Guarantee and this Indenture
pursuant to a supplemental indenture in a form reasonably satisfactory to
the Trustee;
(iii) immediately after giving effect to that transaction and
the use of the proceeds from that transaction, on a pro forma basis,
including giving effect to any Debt Incurred or anticipated to be Incurred
in connection with that transaction and the use of the proceeds from that
transaction,
(A) no Default or Event of Default shall have occurred
and be continuing; and
(B) except in the case of a consolidation or merger of
HoldCo 3 with or into a Wholly Owned Subsidiary Guarantor or a sale,
assignment, transfer, lease, conveyance or other disposition of all
or substantially all of HoldCo 3's assets to a Wholly Owned
Subsidiary Guarantor, immediately after giving effect to such
transaction, either (A) (1) such Surviving Person would not be
obligated on any additional Debt as a result of such transaction if
the transaction occurs during the Restricted Period or (2) such
Surviving Person shall be able to Incur $1.00 of additional Debt
under paragraph (a) of Section 4.09 if the transaction occurs after
the Restricted Period or (B) the Consolidated Coverage Ratio of the
Surviving Person would not be less than the Consolidated Coverage
Ratio of HoldCo 3 immediately prior to the transaction (provided
that this clause (c)(iii)(B) shall not apply after the IPO Effective
Date); and
(iv) HoldCo 3 delivers to the Trustee prior to the
consummation of the proposed transaction an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger or
transfer complies with this Indenture and that all conditions precedent in
this Indenture relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise, in a single transaction or series of related transactions) of all or
substantially all of the properties and assets of one or more Restricted
Subsidiaries, the Capital Stock of which constitutes all or substantially all of
the properties or assets of HoldCo 3, will be deemed to be the transfer of all
or substantially all of the properties and assets of HoldCo 3. Notwithstanding
the foregoing clauses (ii) and (iii),
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(A) any Restricted Subsidiary may consolidate with,
merge into or transfer all or part of its properties and assets to
HoldCo 3, and
(B) HoldCo 3 may merge with one of its Affiliates that
is organized solely for the purpose of reorganizing HoldCo 3 in
another jurisdiction in the United States to realize tax or other
benefits.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
The Surviving Person shall succeed to, and be substituted for, and
may exercise every right and power of SFC, HoldCo 3 or any other Guarantor, as
the case may be, under this Indenture, but the predecessor SFC, HoldCo 3 or
other Guarantor, as the case may be, in the case of:
(a) a sale, transfer, assignment, conveyance or other disposition
(unless such sale, transfer, assignment, conveyance or other disposition is of
all the assets of SFC, HoldCo 3, or a Guarantor, as the case may be, as an
entirety or virtually as an entirety), or
(b) a lease, shall not be released from any of the obligations or
covenants under this Indenture, including with respect to the payment of the
Notes and the delivery of Common Stock.
ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
Each of the following is an "EVENT OF DEFAULT:"
(i) the failure to pay interest including Special Interest,
if any, on the Notes when that interest or Special Interest becomes due
and payable and the Default continues for 30 days;
(ii) the failure to pay principal of or premium, if any, on
the Notes when that principal or premium, if any, becomes due and payable,
at maturity, upon redemption or otherwise;
(iii) the failure to deliver when due all cash and shares of
the Common Stock deliverable upon conversion of the Notes, which failure
continues for 15 days;
(iv) the failure to observe or perform any other covenant or
agreement contained in the Notes, the Guarantees or this Indenture (other
than Events of Default described in clauses (vi) and (vii) below), which
failure continues for a period of 60 days after SFC receives a written
notice specifying the default from the Trustee or Holders of at least 25%
in aggregate principal amount of outstanding Notes;
(v) the failure by SFC, HoldCo 3 or any Restricted
Subsidiary to pay Debt at the final stated maturity, after giving effect
to any extensions, or upon the acceleration of the final stated maturity
of that Debt, if the aggregate principal amount of that Debt, together
with the aggregate principal amount of any other such Debt in default for
failure to pay principal at the final stated maturity, after giving effect
to any extensions, or upon the acceleration of the final stated maturity
of that Debt, aggregates $20.0 million or more at any time and such
default shall not have been cured or such acceleration shall not have been
rescinded after a 10-day period;
(vi) default in SFC's obligation to repurchase the Notes at
the option of a Holder in connection with a Change of Control pursuant to
Section 4.18;
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(vii) failure on the part of SFC to provide notice of the
occurrence of a Change of Control within 90 days after the occurrence of
such Change of Control as required by Section 4.18;
(viii) one or more judgments in an aggregate amount in
excess of $20.0 million, which judgments are not covered by insurance, or
if covered by insurance, as to which the insurer has disclaimed coverage,
being rendered against SFC or any of its Subsidiaries and such judgment or
judgments remain undischarged, unwaived or unstayed for a period of 60
days after such judgment or judgments become final and nonappealable
(provided that this clause (viii), prior to such time as SFC either
becomes the maker or guarantor of the Seller Note pursuant to the terms of
the Seller Note or any notes exchanged for the Seller Note pursuant to the
terms of the Seller Note, shall only relate to a judgment rendered in
respect of the Seller Note if the underlying acceleration thereof was also
an event that was an Event of Default under clause (xii) below);
(ix) SFC, HoldCo 3, HoldCo 2 or any of SFC's Significant
Subsidiaries pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a custodian of it
or for all or substantially all of its property;
(D) makes a general assignment for the benefit of its
creditors; or
(E) admits in writing its inability to pay its debts
as they become due; and
(x) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against SFC, HoldCo 3, HoldCo 2 or
any of SFC's Significant Subsidiaries in an involuntary case; or
(B) appoints a custodian of SFC, HoldCo 3, HoldCo 2 or
any of SFC's Significant Subsidiaries or for all or substantially
all of the property of SFC or any of its Significant Subsidiaries;
or
(C) orders the liquidation of SFC, HoldCo3, HoldCo 2
or any of SFC's respective Significant Subsidiaries;
and the order or decree remains unstayed and in effect for 60
consecutive days;
(xi) the Guarantee of HoldCo 3 or any Guarantee of a
Significant Subsidiary of SFC (A) ceases to be in full force and effect,
(B) is declared to be null and void and unenforceable by a judicial
determination or (C) is found to be invalid by a judicial determination,
or any Guarantor denies its obligations under its Guarantee (in each case,
other than by reason of release of a Guarantor in accordance with the
terms of this Indenture);
(xii) prior to such time as SFC either becomes the maker or
the guarantor of the Seller Note pursuant to the terms of the Seller Note
or any notes exchanged for the Seller Note pursuant to the terms of the
Seller Note, the acceleration of HoldCo 2's obligations under the Seller
Note upon the occurrence of an event described in clauses (i) or (iii) of
the definition of "Event of Default" in the Seller Note (provided that in
the case of an event of default described in clause (i) of such
definition, such acceleration is for a reason other than an event of
default described in clause (ii) of such definition); or
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(xiii) after such time as SFC either becomes the maker or
the guarantor of the Seller Note pursuant to the terms of the Seller Note
or any notes exchanged for the Seller Note pursuant to the terms of the
Seller Note, the acceleration of SFC's or HoldCo 2's obligations under the
Seller Note.
SECTION 6.02. ACCELERATION.
If any Event of Default (other than those of the type described in
Section 6.01(viii) or Section 6.01(ix)) occurs and is continuing, the Trustee
may, and the Trustee upon the request of Holders of 25% in principal amount of
the outstanding Notes will, or the Holders of at least 25% in principal amount
of outstanding Notes may, declare the principal of all the Notes, together with
all accrued and unpaid interest, premium, if any, and Special Interest, if any,
to be due and payable by notice in writing to SFC and the Trustee specifying the
respective Event of Default and that such notice is a notice of acceleration
(the "ACCELERATION NOTICE"), and the same shall become immediately due and
payable.
In the case of an Event of Default specified in Section 6.01(viii)
or Section 6.01(ix) of Section 6.01 hereof, such amount with respect to all the
Notes will become due and payable immediately without any declaration or other
act on the part of the Trustee or the holders of the Notes. Holders may not
enforce this Indenture or the Notes except as provided in this Indenture.
At any time after a declaration of acceleration with respect to
the Notes, the Holders of a majority in principal amount of the Notes then
outstanding (by notice to the Trustee) may rescind and cancel that declaration
and its consequences if:
(a) the rescission would not conflict with any judgment or decree
of a court of competent jurisdiction;
(b) all existing Defaults and Events of Default have been cured or
waived except nonpayment of principal of or interest on the Notes that has
become due solely by such declaration of acceleration;
(c) to the extent the payment of such interest is lawful, interest
(at the same rate specified in the Notes) on overdue installments of interest
and overdue payments of principal which has become due otherwise than by such
declaration of acceleration has been paid;
(d) SFC has paid the Trustee its reasonable compensation and
reimbursed the Trustee for its reasonable expenses, disbursements and advances;
and
(e) in the event of the cure or waiver of an Event of Default of
the type described in Section 6.01(viii) or Section 6.01(ix), the Trustee has
received from SFC an Officers' Certificate and Opinion of Counsel that such
Event of Default has been cured or waived.
In the case of an Event of Default occurring by reason of any
willful action or inaction taken or not taken by SFC or on SFC's behalf with the
intention of avoiding payment of the premium that SFC would have been required
to pay if SFC had then elected to redeem the Notes pursuant to Section 3.07
hereof, an equivalent premium will also become and be immediately due and
payable to the extent permitted by law upon the acceleration of the Notes.
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, premium, if
any, and interest and Special Interest, if any, on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
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SECTION 6.04. WAIVER OF PAST DEFAULTS.
The Holders of a majority in principal amount of the Notes may
waive by consent (including, without limitation, consents obtained in connection
with a purchase of, or tender offer or exchange offer for, Notes) any then
existing or potential Default, and its consequences, except a default in the
payment of the principal of or interest on any Notes. In the event of any Event
of Default specified in clause (iv) of the first paragraph of Section 6.01, such
Event of Default and all consequences of that Event of Default, including
without limitation any acceleration or resulting payment default, will be
annulled, waived and rescinded, automatically and without any action by the
Trustee or the Holders of the Notes, if within 60 days after the Event of
Default arose:
(a) the Debt that is the basis for the Event of Default has been
discharged;
(b) the holders of that Debt have rescinded or waived the
acceleration, notice or action, as the case may be, giving rise to the Event of
Default; or
(c) if the default that is the basis for such Event of Default has
been cured.
When a Default or Event of Default is waived, it is deemed cured,
but no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any consequent right.
SECTION 6.05. CONTROL BY MAJORITY.
Subject to Section 7.01, Section 7.02(f) (including the Trustee's
receipt of the security or indemnification described therein) and Section 7.07,
in case an Event of Default shall occur and be continuing, the Holders of a
majority in aggregate principal amount of the Notes then outstanding will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power conferred
on the Trustee with respect to the Notes.
SECTION 6.06. LIMITATION ON SUITS.
No Holder will have any right to institute any proceeding with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any remedy thereunder, unless:
(a) such Holder has previously given to the Trustee written notice
of a continuing Event of Default,
(b) Holders of at least 25% in aggregate principal amount of the
Notes then outstanding have made written request and offered reasonable
indemnity to the Trustee to institute such proceeding as trustee, and
(c) the Trustee shall not have received from the Holders of a
majority in aggregate principal amount of the Notes then outstanding a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days.
A Holder may not use this Indenture to affect, disturb or
prejudice the rights of another Holder or to obtain a preference or priority
over another Holder.
SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT AND TO CONVERT.
Notwithstanding any other provision of this Indenture (including,
without limitation, Section 6.06), the right of any Holder to receive payment of
principal, premium, if any, and interest and Special Interest, if any, on the
Notes held by such Holder, on or after the respective due dates expressed in the
Notes (including in connection with an offer to purchase), and to convert any of
such Notes pursuant to Article 14, and 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.
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SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(i) or Section
6.01(ii) occurs and is continuing, the Trustee is authorized to recover judgment
in its own name and as trustee of an express trust against SFC and any other
obligor upon the Notes for the whole amount of principal of, premium, if any,
and interest and Special Interest, if any, then due and owing (together with
interest on overdue principal and, to the extent lawful, interest) and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relative to SFC and any other
obligor upon the Notes, its creditors or its property and shall be entitled and
empowered to participate as a member, voting or otherwise, of any official
committee of creditors appointed in such matter and shall be entitled and
empowered to collect, receive and distribute any money or other property payable
or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that any such compensation, expenses and
advances of the Trustee and its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, moneys, securities and
any other properties that the Holders may be entitled to receive in such
proceeding whether in liquidation or any plan of reorganization or arrangement
or otherwise. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder, or to authorize the Trustee to vote in respect of the
claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article 6, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest and Special Interest, if any, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium, if any, and interest and Special
Interest, if any, respectively; and
Third: to SFC or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment
to Holders pursuant to this Section 6.10.
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 a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit
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by the Trustee, a suit by HoldCo 3, a suit by a Holder pursuant to Section 6.07
hereof, or a suit by Holders of more than 10% in principal amount of the then
outstanding Notes.
ARTICLE 7.
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default which the Trustee has, or is deemed to
have, notice hereunder has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in its exercise, as a prudent Person would
exercise or use under the circumstances in the conduct of such Person's own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee shall be determined
solely by the express provisions of this Indenture and the
Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, 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 (but need not
confirm or investigate the accuracy of mathematical
calculations or other facts stated therein or otherwise
verify the contents thereof).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section;
(2) the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer,
unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to
Section 6.05 hereof; and
(4) no provision of this Indenture shall require
the Trustee to expend or risk its own funds or incur any
liability.
(d) Whether or not therein expressly so provided, 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) Except for information provided by the Trustee concerning the
Trustee, the Trustee shall have no responsibility for any information in any
prospectus or other disclosure material distributed with respect to the Notes.
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SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon 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 any such document.
Any facsimile signature of any Person on a document required or permitted in
this Indenture to be delivered to the Trustee shall constitute a legal, valid
and binding execution thereof by such Person.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both from HoldCo 3
and SFC. The Trustee shall not be liable for any action it takes or omits to
take in good faith in reliance on such Officers' Certificate or Opinion of
Counsel. The Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and 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 that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from SFC or HoldCo 3 shall be sufficient if
signed by an Officer of SFC or HoldCo 3, as the case may be.
(f) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
(g) The Trustee shall not be deemed to have notice of any Default
or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
Default or Event of Default is received by a Responsible Officer of the Trustee
at the Corporate Trust Office of the Trustee from SFC or the Holders of 25% in
aggregate principal amount of the outstanding Notes, and such notice references
the specific Default or Event of Default, the Notes and this Indenture and, in
the absence of any such notice, the Trustee may conclusively assume that no such
Default or Event of Default exists.
(h) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with SFC.
(i) The Trustee shall not be required to give any bond or surety
in respect of the performance of its power and duties hereunder.
(j) The Trustee shall have no duty to inquire as to the
performance of SFC's or HoldCo 3's covenants herein.
(k) The Trustee's immunities and protections from liability and
its right to indemnification in connection with the performance of its duties
under this Indenture shall extend to the Trustee's officers, directors, agents,
attorneys and employees. Such immunities and protections and right to
indemnification, together with the Trustee's right to compensation, shall
survive the Trustee's resignation or removal, the defeasance or discharge of
this Indenture and final payment of the Notes.
(l) The right of the Trustee to take the actions permitted by this
Indenture shall not be construed as an obligation or duty to do so.
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SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with SFC or any Affiliate of
SFC with the same rights it would have if it were not Trustee. However, in the
event that the Trustee acquires any conflicting interest it must eliminate such
conflict within 90 days, apply to the Commission for permission to continue as
Trustee or resign. Any Agent may do the same with like rights and duties. The
Trustee is also subject to Section 7.10 and Section 7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for SFC's use of the proceeds from the Notes or any
money paid to SFC or upon SFC's direction under any provision of this Indenture,
it shall not be responsible for the use or application of any money received by
any Paying Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Notes or any other document
in connection with the sale of the Notes or pursuant to this Indenture other
than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if
it is known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs unless such Default
or Event of Default has since been cured. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest or
Special Interest, if any, on any Note, the Trustee may withhold the notice if
and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of the Holders.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders a brief report dated as of
such reporting date that complies with TIA Section 313(a) (but if no event
described in TIA Section 313(a) has occurred within the twelve months preceding
the reporting date, no report need be transmitted). The Trustee also shall
comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail all
reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders
shall be mailed to SFC and filed with the Commission and each stock exchange on
which the Notes are listed in accordance with TIA Section 313(d). SFC shall
promptly notify the Trustee when the Notes are listed on any stock exchange and
any delisting thereof.
SECTION 7.07. COMPENSATION AND INDEMNITY.
SFC shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder as SFC
and the Trustee shall agree in writing. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. SFC shall
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by it in addition to the compensation for
its services. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
SFC shall indemnify the Trustee (in its capacity as Trustee) or
any predecessor Trustee (in its capacity as Trustee) against any and all losses,
claims, damages, penalties, fines, liabilities or expenses, including incidental
and out-of-pocket expenses and reasonable attorneys fees ("LOSSES") incurred by
it arising out of or in connection with the acceptance or administration of its
duties under this Indenture, including the costs and expenses of enforcing this
Indenture against SFC (including this Section 7.07) and defending itself against
any claim (whether asserted by SFC or any Holder or any other person) or
liability in connection with the exercise or performance of any of its powers or
duties hereunder. The Trustee shall notify SFC promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify SFC shall not relieve
SFC of its obligations hereunder. SFC shall defend the claim, and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel if the
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Trustee has been reasonably advised by counsel that there may be one or more
legal defenses available to it that are different from or additional to those
available to SFC and in the reasonable judgment of such counsel it is advisable
for the Trustee to engage separate counsel, and SFC shall pay the reasonable
fees and expenses of such counsel. SFC need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld. SFC need
not reimburse any expense or indemnify against any loss incurred by the Trustee
through the Trustee's own willful misconduct, gross negligence or bad faith.
The obligations of SFC under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture, the resignation or removal of the
Trustee and payment in full of the Notes.
To secure SFC's payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal, premium, if any, and
interest and Special Interest, if any, on particular Notes. Such Lien shall
survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(ix) or Section 6.01(x) hereof occurs,
the expenses and the compensation for the services (including the fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time upon 30 days prior
notice to SFC and be discharged from the trust hereby created by so notifying
SFC. The Holders of a majority in principal amount of the then outstanding Notes
may remove the Trustee by so notifying the Trustee and SFC in writing. SFC may
remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or
its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), SFC shall promptly appoint a successor Trustee.
Within one year after the successor Trustee takes office, the Holders of a
majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by SFC.
If a successor Trustee does not take office within 30 days after
the retiring Trustee resigns or is removed, the retiring Trustee, SFC, or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to SFC. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders. Subject to the Lien provided for in Section 7.07 hereof, the retiring
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Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, SFC's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another corporation
or banking association, the successor corporation or banking association without
any further act shall, if such successor corporation or banking association is
otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a Person
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $50,000,000
(or a wholly-owned subsidiary of a bank or trust company, or of a bank holding
company, the principal subsidiary of which is a bank or trust company having a
combined capital and surplus of at least $50,000,000) as set forth in its most
recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST SFC.
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
SFC may, at its option and at any time prior to expiration of the
Restricted Period, elect to have either Section 8.02 or Section 8.03 hereof be
applied to all outstanding Notes upon compliance with the conditions set forth
below in this Article 8. This Article 8 shall terminate upon expiration of the
Restricted Period.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon SFC's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, SFC shall, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be deemed to have been discharged
from its obligations with respect to all outstanding Notes on the date the
conditions set forth below are satisfied (hereinafter, "LEGAL DEFEASANCE") and
each Guarantor shall be released from all of its obligations under its
Guarantee. For this purpose, Legal Defeasance means that SFC shall be deemed to
have paid and discharged the entire Debt represented by the outstanding Notes,
which shall thereafter be deemed to be "outstanding" only for the purposes of
Section 8.05 hereof and the other Sections of this Indenture referred to in (a),
(b), (c) and (d) below, and to have satisfied all its other obligations under
the Notes and this Indenture (and the Trustee, on demand of and at the expense
of SFC, shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to receive
solely from the trust fund described in Section 8.04 hereof, and as more fully
set forth in such Section, payments in respect of the principal of, premium, if
any, or interest and Special Interest, if any, on such Notes when such payments
are due, (b) SFC's obligations with respect to such Notes under Article 2 and
Section 4.01 and Section 4.02 hereof, (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and SFC's obligations in connection
therewith and (d) this Article 8. If SFC exercises under Section 8.01 hereof the
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option applicable to this Section 8.02, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, payment of the Notes may not be
accelerated because of an Event of Default. Subject to compliance with this
Article 8, SFC may exercise its option under this Section 8.02 notwithstanding
the prior exercise of its option under Section 8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon SFC's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, SFC shall, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be released from its obligations
under the covenants contained in Section 4.08 through Section 4.27 hereof, and
the operation of Section 5.01(a)(iii) and Section 5.01(c)(iii) hereof, with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE") and each
Guarantor shall be released from all of its obligations under its Guarantee with
respect to such covenants in connection with such outstanding Notes and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, SFC may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or an Event of Default under Section 6.01 hereof,
but, except as specified above, the remainder of this Indenture and such Notes
shall be unaffected thereby. If SFC exercises under Section 8.01 hereof the
option applicable to this Section 8.03, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, payment of the Notes may not be
accelerated because of an Event of Default specified in clause (iii) (with
respect to the covenants contained in Section 4.08 through Section 4.27 hereof),
(iv), (v), (vi), (vii) and (viii) (but in the case of (ix) and (x) of Section
6.01 hereof, with respect to Significant Subsidiaries only) or because of SFC's
failure to comply with Section 5.01(a)(iii) or HoldCo 3's failure to comply with
Section 5.01(c)(iii).
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or Section 8.03 hereof to the outstanding Notes.
The Legal Defeasance or Covenant Defeasance may be exercised only
if:
(a) SFC irrevocably deposits with the Trustee, in trust (the
"DEFEASANCE TRUST"), for the benefit of the Holders of the Notes, cash in U.S.
dollars, non-callable U.S. Government Securities, or a combination of cash in
U.S. dollars and non-callable U.S. Government Securities, sufficient, in the
opinion of a firm of independent public accountants of recognized international
standing, to pay the principal, premium, if any, and interest and Special
Interest, if any, on the outstanding Notes on the Stated Maturity or on the next
available redemption date, as the case may be, and SFC must specify whether the
Notes are being defeased to maturity or to that particular redemption date;
(b) in the case of Legal Defeasance, SFC delivers to the Trustee
an Opinion of Counsel reasonably acceptable to the Trustee confirming that (a)
SFC has received from, or there has been published by, the Internal Revenue
Service a ruling or (b) since the date hereof, 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 will confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(c) in the case of Covenant Defeasance, SFC delivers to the
Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming
that the Holders of the outstanding Notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance and
will be subject to
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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;
(d) no Event of Default under Section 6.01(ix) or Section 6.01(x)
shall have occurred at any time in the period ending on the 91st day after the
cash and/or non-callable U.S. Government Securities have been deposited in the
defeasance trust;
(e) such Legal Defeasance or Covenant Defeasance will not result
in a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which SFC, HoldCo 3 or
any of its Restricted Subsidiaries is a party or by which SFC, HoldCo 3 or any
of its Restricted Subsidiaries is bound;
(f) SFC delivers to the Trustee an Opinion of Counsel, subject to
customary exceptions, to the effect that on the 91st day following the deposit,
the defeasance trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws generally affecting
creditors' rights;
(g) SFC delivers to the Trustee an Officers' Certificate stating
that the deposit was not made by SFC with the intent of preferring the Holders
of Notes over SFC's other creditors with the intent of defeating, hindering,
delaying or defrauding any other creditors of SFC;
(h) SFC delivers to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent relating to the
Legal Defeasance or the Covenant Defeasance have been complied with; and
(i) Notwithstanding the foregoing, the Opinion of Counsel required
by clause (b) above with respect to a Legal Defeasance need not be delivered if
all Notes not theretofore delivered to the Trustee for cancellation (A) have
become due and payable, (B) will become due and payable on the maturity date
within one year or (C) as to which a redemption notice has been given calling
the Notes for redemption within one year, under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name, and
at the expense, of SFC.
SECTION 8.05. DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all cash and non-callable U.S.
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "TRUSTEE") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including SFC acting as Paying
Agent) as the Trustee may determine, to the Holders of all sums due and to
become due thereon in respect of principal, premium, if any, and interest and
Special Interest, if any, but such cash and securities need not be segregated
from other funds except to the extent required by law.
SFC shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or U.S. Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to SFC from time to time upon the request of SFC
any cash or non-callable U.S. Government Securities held by it as provided in
Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent certified public accountants of recognized international standing
expressed in a written certification thereof delivered to the Trustee (which may
be the certification delivered under Section 8.04(a) hereof), are in excess of
the amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
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SECTION 8.06. REPAYMENT TO SFC.
Any cash or non-callable U.S. Government Securities deposited with
the Trustee or any Paying Agent, or then held by SFC, in trust for the payment
of the principal, premium, if any, or interest or Special Interest, if any, on
any Note and remaining unclaimed for two years after such principal, premium, if
any, or interest or Special Interest, if any, has become due and payable shall
be paid to SFC on its request or (if then held by SFC) shall be discharged from
such trust; and the Holder shall thereafter, as an unsecured creditor, look only
to SFC for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such cash and securities, and all liability of SFC as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of SFC cause to be published once, in The New York Times and The Wall
Street Journal (national edition), notice that such cash and securities remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such notification or publication, any unclaimed balance
of such cash and securities then remaining shall be repaid to SFC.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any cash or
non-callable U.S. Government Securities in accordance with Section 8.02 or
Section 8.03 hereof, as the case may be, by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then SFC's obligations under this Indenture and
the Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.02 or Section 8.03 hereof until such time as the Trustee
or Paying Agent is permitted to apply all such cash and securities in accordance
with Section 8.02 or Section 8.03 hereof, as the case may be; provided, however,
that, if SFC makes any payment of principal of, premium, if any, or interest or
Special Interest, if any, on any Note following the reinstatement of its
obligations, SFC shall be subrogated to the rights of the Holders to receive
such payment from the cash and securities held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, SFC, HoldCo 3, the
other Guarantors and the Trustee may amend or supplement this Indenture or the
Notes without the consent of any Holder to:
(a) cure any ambiguity, omission, defect or inconsistency;
(b) provide for the assumption by a successor corporation,
partnership or limited liability company of the obligations of SFC, HoldCo 3,
the other Guarantors or the Trustee under this Indenture;
(c) provide for uncertificated Notes in addition to or in place of
certificated Notes (provided that the uncertificated Notes are issued in
registered form for purposes of Section 163(f) of the Code, or in a manner such
that the uncertificated Notes are described in Section 163(f)(2)(B) of the
Code);
(d) add additional Guarantees or additional obligors with respect
to the Notes;
(e) secure the Notes;
(f) add to the covenants of SFC, HoldCo 3, the other Guarantors or
the Trustee for the benefit of the Holders of the Notes or to surrender any
right or power conferred upon SFC, HoldCo 3, the other Guarantors or the
Trustee;
(g) providing for conversion rights of Holders if any
reclassification or change of Common Stock or any consolidation, merger or sale
of all or substantially all of SFC's property and assets occurs or otherwise
complying with the provisions of this Indenture in the event of a merger,
consolidation or transfer of assets (including the provisions of Section 14.10
and Article 5);
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(h) increasing the Conversion Rate, provided that the increase
will not adversely affect the interests of Holders;
(i) make any other change that does not adversely affect the legal
rights hereunder of any such Holder;
(j) make any change to comply with any requirement of the
Commission in order to effect or maintain the qualification of this Indenture
under the TIA;
(k) subject to Section 9.03, make any change to the subordination
provisions of this Indenture that would limit or terminate the benefits
available to any holder of Senior Debt under such provisions.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, SFC and the Trustee
may amend or supplement this Indenture and the Notes with the consent of the
Holders of a majority in principal amount of the Notes then outstanding voting
as a single class (including consents obtained in connection with a purchase of
or tender offer or exchange offer for the Notes), and, subject to Section 6.04
and Section 6.07 hereof, any existing Default or Event of Default (except a
continuing Default or Event of Default in the payment of principal, premium, if
any, or interest or Special Interest, if any, on the Notes) or compliance with
any provision of this Indenture or the Notes (except for certain covenants and
provisions of this Indenture which cannot be amended without the consent of each
Holder) may be waived with the consent of the Holders of a majority in principal
amount of the Notes, then outstanding voting as a single class (including
consents obtained in connection with a purchase of or tender offer or exchange
offer for the Notes).
Without the consent of each Holder, an amendment or waiver under
this Section 9.02 may not (with respect to any Notes held by a non-consenting
Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the rate of or change the time for payment of interest,
including defaulted interest and Special Interest, on any Notes;
(c) reduce the principal of or change the fixed maturity of any
Notes, or change the date on which any Notes may be subject to redemption or
repurchase, or reduce the redemption or repurchase price for those Notes
(except, in the case of repurchases, as would otherwise be permitted under
clauses (g) and (j) hereof);
(d) make any Note payable in money other than that stated in the
Note and this Indenture;
(e) impair the right of any Holder to receive payment of
principal, premium, interest and Special Interest, if any, on that Holder's
Notes on or after the due dates for those payments, or to bring suit to enforce
that payment on or with respect to such Holder's Notes or any Guarantee;
(f) modify Section 6.04 hereof;
(g) after SFC's obligation to purchase the Notes arises under
Section 4.18 hereof, amend, modify or change the obligation of SFC to make or
consummate a Change of Control Offer or waive any default in the performance of
that Change of Control Offer or modify any of the provisions or definitions with
respect to any such offer;
(h) release any Guarantor from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with the terms of this
Indenture;
(i) make any change to the subordination provisions of this
Indenture that would adversely affect the Holders of the Notes, subject to
Section 9.03;
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(j) at any time after SFC is obligated to make an Asset Sale Offer
pursuant to Section 4.12 hereof, change the time at which such offer to purchase
must be made or at which the Notes must be repurchased pursuant thereto;
(k) make any change that adversely affects the rights of Holders
to convert any of the Notes into Conversion Consideration; or
(l) make any change in any Guarantee that would adversely affect
the Holders of the Notes.
SFC may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to consent to any supplemental
indenture. If a record date is fixed, the Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to consent to
such supplemental indenture, whether or not such Holders remain Holders after
such record date; provided that unless such consent shall have become effective
by virtue of the requisite percentage having been obtained prior to the date
which is 120 days after such record date, any such consent previously given
shall automatically and without further action by any Holder be cancelled and of
no further effect.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, SFC shall mail to the Holder of each Note affected thereby to
such Holder's address appearing in the Security Register a notice briefly
describing the amendment, supplement or waiver. Any failure of SFC to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amended or supplemental indenture or waiver. Subject to
Section 6.04 and Section 6.07 hereof, the Holders of a majority in aggregate
principal amount of the Notes, if any, then outstanding voting as a single class
may waive compliance in a particular instance by SFC with any provision of this
Indenture or the Notes.
SECTION 9.03. WITH CONSENT OF HOLDERS OF SENIOR DEBT.
No amendment or supplement may be made to the subordination
provisions of this Indenture that adversely affects the rights of any holder of
Senior Debt then outstanding unless the Representative of the holders of such
Senior Debt or, if there is no Representative, the holders of such Senior Debt
consent to such change.
SECTION 9.04. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall
be set forth in an amended or supplemental indenture that complies with the TIA
as then in effect.
SECTION 9.05. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion thereof that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder or subsequent Holder may revoke the
consent as to its Note or portion thereof if the Trustee receives written notice
of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
SECTION 9.06. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. SFC in exchange for
all Notes may issue and the Trustee shall, upon receipt of an Authentication
Order, authenticate new Notes that reflect the amendment, supplement or waiver.
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Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.07. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
Neither SFC nor HoldCo 3 shall sign an amendment or supplemental indenture until
their respective boards of directors approve it, which approval shall be
evidenced by the delivery to the Trustee of a Board Resolution from each such
company or other Guarantors who may become a party hereto. In executing any
amended or supplemental indenture, the Trustee shall be entitled to receive and
(subject to Section 7.01 hereof) shall be fully protected in relying upon an
Officer's Certificate and an Opinion of Counsel stating that the execution of
such amended or supplemental indenture is authorized or permitted by this
Indenture and that such amended or supplemental indenture is the legal, valid
and binding obligations of SFC, HoldCo 3 and other Guarantors who may become
parties hereto enforceable against each of them in accordance with its terms,
subject to customary exceptions and that such amended or supplemental indenture
complies with the provisions hereof (including Section 9.03).
ARTICLE 10.
GUARANTEES
SECTION 10.01. GUARANTEE.
Subject to this Article 10 and Article 12 hereof, each of the
Guarantors hereby unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns that: (a) the principal of, premium, if any, and interest and
Special Interest, if any, on the Notes shall be promptly paid in full when due,
subject to any applicable grace period, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of, and interest
and Special Interest, if any, on, the Notes, if lawful, and all other
obligations of SFC to the Holders or the Trustee hereunder or thereunder shall
be promptly paid in full or performed, all in accordance with the terms hereof
and thereof; and (b) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that same shall be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration pursuant to Section 6.02
hereof, redemption or otherwise. Failing payment when due of any amount so
guaranteed or any performance so guaranteed for whatever reason, the Guarantors
shall be jointly and severally obligated to pay the same immediately. Each
Guarantor agrees that this is a guarantee of payment and not a guarantee of
collection.
Each Guarantor hereby agrees that its obligations with regard to
this Guarantee shall be joint and several, unconditional, irrespective of the
validity or enforceability of the Notes or the obligations of SFC under this
Indenture, the absence of any action to enforce the same, the recovery of any
judgment against SFC or any other obligor with respect to this Indenture, the
Notes or the Obligations of SFC under this Indenture or the Notes, any action to
enforce the same or any other circumstances (other than complete performance)
which might otherwise constitute a legal or equitable discharge or defense of a
Guarantor. Each Guarantor further, to the extent permitted by law, waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims, rights
or remedies, including but not limited to: (a) any right to require any of the
Trustee, the Holders or SFC (each a "BENEFITED PARTY"), as a condition of
payment or performance by such Guarantor, to (1) proceed against SFC, any other
guarantor (including any other Guarantor) of the Obligations under the
Guarantees or any other Person, (2) proceed against or exhaust any security held
from SFC, any such other guarantor or any other Person, (3) proceed against or
have resort to any balance of any deposit account or credit on the books of any
Benefited Party in favor of SFC or any other Person, or (4) pursue any other
remedy in the power of any Benefited Party whatsoever; (b) any defense arising
by reason of the incapacity, lack of authority or any disability or other
defense of SFC including any defense based on or arising out of the lack of
validity or the unenforceability of the Obligations under the Guarantees or any
agreement or instrument relating thereto or by reason of the cessation of the
liability of SFC from any cause other than payment in full of the Obligations
under the Guarantees; (c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the
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principal; (d) any defense based upon any Benefited Party's errors or omissions
in the administration of the Obligations under the Guarantees, except behavior
which amounts to bad faith; (e)(1) any principles or provisions of law,
statutory or otherwise, which are or might be in conflict with the terms of the
Guarantees and any legal or equitable discharge of such Guarantor's obligations
hereunder, (2) the benefit of any statute of limitations affecting such
Guarantor's liability hereunder or the enforcement hereof, (3) any rights to
set-offs, recoupments and counterclaims and (4) promptness, diligence and any
requirement that any Benefited Party protect, secure, perfect or insure any
security interest or lien or any property subject thereto; (f) notices, demands,
presentations, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance of the Guarantees, notices of
default under the Notes or any agreement or instrument related thereto, notices
of any renewal, extension or modification of the Obligations under the
Guarantees or any agreement related thereto, and notices of any extension of
credit to SFC and any right to consent to any thereof; (g) to the extent
permitted under applicable law, the benefits of any "One Action" rule and (h)
any defenses or benefits that may be derived from or afforded by law which limit
the liability of or exonerate guarantors or sureties, or which may conflict with
the terms of the Guarantees. Except to the extent expressly provided herein,
including Section 8.02, Section 8.03 and Section 10.05, each Guarantor hereby
covenants that its Guarantee shall not be discharged except by complete
performance of the obligations contained in its Guarantee and this Indenture.
If any Holder or the Trustee is required by any court or
otherwise to return to SFC, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either SFC or the Guarantors,
any amount paid by either to the Trustee or such Holder, this Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor agrees that it shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one hand,
and the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Section 6.02
hereof for the purposes of this Guarantee, notwithstanding any stay, injunction
or other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby and (y) in the event of any declaration of acceleration of
such obligations as provided in Section 6.02 hereof, such obligations (whether
or not due and payable) shall forthwith become due and payable by the Guarantors
for the purpose of this Guarantee. The Guarantors shall have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Guarantee.
SECTION 10.02. LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Notes, each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
of such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law to the extent
applicable to any Guarantee. To effectuate the foregoing intention, the Trustee,
the Holders and the Guarantors hereby irrevocably agree that the obligations of
such Guarantor under this Article 10 shall be limited to the maximum amount as
shall, after giving effect to such maximum amount and all other contingent and
fixed liabilities of such Guarantor that are relevant under such laws,
including, if applicable, its guarantee of all obligations under the Senior
Credit Facilities and the Senior Notes, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 10, result in the obligations of such Guarantor
under its Guarantee not constituting a fraudulent transfer or conveyance.
SECTION 10.03. EXECUTION AND DELIVERY OF GUARANTEE.
To evidence its Guarantee set forth in Section 10.01 hereof, each
Guarantor hereby agrees that a notation of such Guarantee in substantially the
form included in Exhibit E shall be endorsed by an Officer of such Guarantor on
each Note authenticated and delivered by the Trustee and that this Indenture
shall be executed on behalf of such Guarantor by its President or one of its
Vice Presidents.
Each Guarantor hereby agrees that its Guarantee set forth in
Section 10.01 hereof shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Guarantee.
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If an Officer whose signature is on this Indenture or on the
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Guarantee is endorsed, the Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this Indenture on behalf of the Guarantors.
SECTION 10.04. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Each Guarantor shall not, and SFC shall not cause or permit any
Guarantor to, consolidate with or merge with or into any Person other than SFC
or any other Guarantor unless:
(a) the entity formed by or surviving any such consolidation or
merger (if other than the Guarantor) is a corporation, partnership or limited
liability company organized and existing under the laws of the United States or
any State of the United States or the District of Columbia;
(b) such entity surviving any such consolidation or merger (if
other than the Guarantor) assumes by supplemental indenture all of the
obligations of the Guarantor on the Guarantee; and
(c) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing.
In connection with any merger or consolidation of a Guarantor
with and into SFC (with SFC being the surviving entity) or another Guarantor
that is a Wholly Owned Subsidiary, SFC must deliver to the Trustee prior to the
consummation of the proposed transaction an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation or merger complies with this
Indenture and that all conditions precedent in this Indenture relating to such
transaction have been satisfied.
In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor Person, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by SFC and delivered to the Trustee. All the Guarantees so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Guarantees theretofore and thereafter issued in accordance with
the terms of this Indenture as though all of such Guarantees had been issued at
the date of the execution hereof.
Except as set forth in Article 4 and Article 5 hereof, and
notwithstanding clauses (a) and (b) above, nothing contained in this Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into SFC or another Guarantor, or shall prevent any sale or conveyance
of the property of a Guarantor as an entirety or substantially as an entirety to
SFC or another Guarantor.
SECTION 10.05. RELEASES FOLLOWING SALE OF ASSETS.
In the event of a sale or other disposition of all of the assets
of any Guarantor, by way of merger, consolidation or otherwise, or a sale or
other disposition of all of the capital stock of any Guarantor, in each case to
a Person that is not (either before or after giving effect to such transactions)
a Subsidiary Guarantor of SFC, then such Guarantor (in the event of a sale or
other disposition, by way of merger, consolidation or otherwise, of all of the
capital stock of such Guarantor) or the corporation acquiring the property (in
the event of a sale or other disposition of all or substantially all of the
assets of such Guarantor) shall be released and relieved of any obligations
under its Guarantee; provided that the net proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of this
Indenture, including without limitation Section 4.12 hereof. Upon delivery by
SFC to the Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale or other disposition was made by SFC in accordance with
the provisions of this Indenture, including without limitation Section 4.12
hereof,
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the Trustee shall execute any documents reasonably required in order to evidence
the release of any Guarantor from its obligations under its Guarantee.
Any Guarantor not released from its obligations under its
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this Indenture
as provided in this Article 10.
ARTICLE 11.
SUBORDINATION
SECTION 11.01. AGREEMENT TO SUBORDINATE.
SFC agrees, and each Holder by accepting a Note agrees, that the
payment of principal of, premium, if any, and interest, including Special
Interest, if any, on, and all other amounts payable in respect of, the Notes is
subordinated in right of payment, to the extent and in the manner provided in
this Article 11 and subject to the provisions of Article 8 hereof, to the
payment when due in cash of all Senior Debt of SFC and that the subordination is
for the benefit of and enforceable by the holders of such Senior Debt. The Notes
shall in all respects rank pari passu with any future Senior Subordinated Debt
and senior to all existing and future Subordinated Debt of SFC, and only Senior
Debt shall rank senior to the Notes in accordance with the provisions set forth
herein. All provisions of this Article 11 shall be subject to Section 11.12. All
references to "Senior Debt" in this Article 11 are to Senior Debt of SFC.
SECTION 11.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY.
(a) Upon any payment or distribution of the assets of SFC to
creditors upon a liquidation, dissolution or winding up of SFC or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to SFC or its property or upon an assignment for the benefit of SFC's
creditors or the marshaling of its assets and liabilities, the holders of Senior
Debt will be entitled to receive payment in full in cash before the Holders of
the Notes are entitled to receive any payment of principal of, premium, if any,
or interest, including Special Interest, if any, on, the Notes, except that
Holders of Notes may receive and retain such payments made in Permitted Junior
Securities and payments from the trust described in Article 8 hereof; and
(b) Until the Senior Debt is paid in full in cash, any
distribution to which Holders of the Notes would be entitled but for this
Article 11 will be made to holders of the Senior Debt as their interests may
appear (except that Holders of Notes may receive and retain payments made in
Permitted Junior Securities and payments and other distributions made from the
trust described in Article 8 hereof; provided that (i) no Holder of the Notes
shall have the right to receive and retain any such Permitted Junior Securities
if the existence of such right would have the effect of causing the Notes to be
treated in the same class of claims as the Senior Debt of SFC or any class of
claims which is pari passu with such Senior Debt and (ii) holders of Senior Debt
shall be entitled to receive any cash payments made to any Holder of Notes on
the account of Permitted Junior Securities until all Obligations in respect of
Senior Debt have been paid in full in cash).
SECTION 11.03. DEFAULT ON SENIOR DEBT.
SFC may not pay (except in Permitted Junior Securities or from
the trust described in Article 8 hereof) principal of, or premium, if any, or
interest on, the Notes, or make any deposit pursuant to Section 8.04, and may
not repurchase, redeem or otherwise retire any Notes (collectively, "PAY THE
NOTES") if (a) any principal, premium, interest or any other amount payable in
respect of any Senior Debt is not paid within any applicable grace period
(including at maturity) or (b) any other default on Senior Debt occurs and the
maturity of such Senior Debt is accelerated in accordance with its terms unless,
in either case, (1) the default has been cured or waived and any such
acceleration has been rescinded or (2) such Senior Debt has been paid in full in
cash; provided, however, that SFC may pay the Notes without regard to the
foregoing if SFC and the Trustee receive written notice approving such payment
from the Representative of the holders of such Senior Debt or, if there is no
Representative, from the holders of such Senior Debt.
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During the continuance of any default (other than a default
described in clause (a) or (b) of the preceding sentence) with respect to any
Designated Senior Debt pursuant to which the maturity thereof may be accelerated
immediately without further notice (except any notice required to effect the
acceleration) or the expiration of any applicable grace period, SFC may not pay
the Notes for a period (a "PAYMENT BLOCKAGE PERIOD") commencing upon the receipt
by SFC and the Trustee of written notice of such default from the Representative
of the holders of such Designated Senior Debt or, if there is no Representative,
from the holders of such Designated Senior Debt, specifying an election to
effect a Payment Blockage Period (a "PAYMENT BLOCKAGE NOTICE") and ending 179
days thereafter (unless such Payment Blockage Period is earlier terminated (a)
by written notice to the Trustee and SFC from the Representative of the holders
of such Designated Senior Debt or, if there is no Representative, from the
holders of such Designated Senior Debt that gave such Payment Blockage Notice,
(b) because such default is no longer continuing or (c) because such Designated
Senior Debt has been repaid in full in cash). Not more than one Payment Blockage
Notice with respect to all issues of Designated Senior Debt may be given in any
consecutive 360-day period, irrespective of the number of defaults with respect
to one or more issues of Designated Senior Debt during such period. No
non-payment default that existed or was continuing on the date of delivery of
any Payment Blockage Notice to the Trustee shall be the basis for a subsequent
Payment Blockage Notice. Following the expiration of any period during which SFC
is prohibited from making payments on the Notes pursuant to a Payment Blockage
Notice, SFC shall (unless otherwise prohibited as described in the first two
sentences of this paragraph) resume making any and all required payments in
respect of the Notes, including, without limitation, any missed payments, unless
the maturity of any Designated Senior Debt has been accelerated, and such
acceleration remains in full force and effect.
SFC shall give prompt written notice to the Trustee of any
default in the payment of any Senior Debt or any acceleration under any Senior
Debt or under any agreement pursuant to which Senior Debt may have been issued.
Failure to give such notice shall not effect the subordination of the Notes to
the Senior Debt or the application of the other provisions provided in this
Article 11.
SECTION 11.04. ACCELERATION OF PAYMENT OF SECURITIES.
If payment of the Notes is accelerated when Designated Senior
Debt is outstanding, SFC may not pay the Notes until three Business Days after
the Representative of the holders of such Designated Senior Debt or, if there is
no Representative, the holders of such Designated Senior Debt receive notice of
such acceleration and, thereafter, may pay the Notes only if this Indenture
otherwise permits payment at that time.
SECTION 11.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If a payment or distribution is made to Holders that because of
this Article 11 should not have been made to them, the Trustee or the Holders
who receive the distribution shall hold it in trust for holders of Senior Debt
(pro rata as to each of such holders of Senior Debt on the basis of the
respective amounts of Senior Debt paid to them) and pay it over to them or their
Representative as their interests may appear.
SECTION 11.06. SUBROGATION.
After all Senior Debt is paid in full and until the Notes are
paid in full, Holders shall be subrogated (equally and ratably with all other
Debt that is pari passu with the Notes) to the rights of holders of Senior Debt
to receive distributions applicable to Senior Debt to the extent that
distributions otherwise payable to the Holders have been applied to the payment
of Senior Debt. A distribution made under this Article 11 to holders of Senior
Debt that otherwise would have been made to Holders is not, as between SFC and
Holders, a payment by SFC on such Senior Debt.
SECTION 11.07. RELATIVE RIGHTS.
This Article 11 defines the relative rights of Holders and
holders of Senior Debt. Nothing in this Indenture shall:
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(a) impair, as between SFC and Holders, the obligation of SFC,
which is absolute and unconditional, to pay principal of, premium, if any, and
interest, including Special Interest, if any, on, the Notes in accordance with
their terms;
(b) affect the relative rights of Holders and creditors of SFC
other then their rights in relation to holders of Senior Debt; or
(c) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or an Event of Default, subject to the rights
of holders of Senior Debt to receive distributions otherwise payable to Holders.
SECTION 11.08. SUBORDINATION MAY NOT BE IMPAIRED BY SFC.
No right of any holder of Senior Debt to enforce the
subordination of the Debt evidenced by the Notes shall be impaired by any act or
failure to act by SFC or by its failure to comply with this Indenture.
SECTION 11.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 11.03, the Trustee or Paying Agent may
continue to make payments on the Notes 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 five Business Days prior to the date of such payment, a
Responsible Officer receives notice satisfactory to it that payments may not be
made under this Article 11. SFC, the Registrar or co-registrar, the Paying
Agent, a Representative or a holder of Senior Debt may give the notice;
provided, however, that, if an issue of Senior Debt has a Representative, only
the Representative may give the notice.
The Trustee in its individual or any other capacity may hold
Senior Debt with the same rights it would have if it were not 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 11 with respect to any Senior Debt that may at any time be held by it,
to the same extent as any other holder of such Senior Debt; and nothing in
Article 7 shall deprive the Trustee of any of its rights as such holder. Nothing
in this Article 11 shall apply to claims of, or payments to, the Trustee under
or pursuant to Section 7.07.
SECTION 11.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to
holders of Senior Debt, the distribution may be made and the notice given to
their Representative (if any).
SECTION 11.11. ARTICLE 11 NOT TO PREVENT EVENTS OF DEFAULT OR LIMIT RIGHT TO
ACCELERATE.
Nothing in this Article 11 shall prevent an Event of Default in
accordance with Article 6 or have any effect on the right of the Holders or the
Trustee to accelerate the maturity of the Notes or to exercise the rights and
remedies in Article 6.
SECTION 11.12. TRUST MONEYS NOT SUBORDINATED.
Notwithstanding anything contained herein to the contrary,
payments from cash or the proceeds of non-callable U.S. Government Securities
held in trust under in Article 8 by the Trustee for the payment of principal of
and interest on the Notes shall not be subordinated to the prior payment of any
Senior Debt or subject to the restrictions set forth in this Article 11, and
none of the Holders shall be obligated to pay over any such amount to SFC or any
holder of Senior Debt or any other creditor of SFC.
SECTION 11.13. TRUSTEE ENTITLED TO RELY.
Upon any payment or distribution pursuant to this Article 11, the
Trustee and the Holders shall be entitled to rely (a) upon any order or decree
of a court of competent jurisdiction in which any proceedings of the nature
referred to in Section 11.02 are pending, (b) upon a certificate of the
liquidating trustee or agent or other
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Person making such payment or distribution to the Trustee or to the Holders or
(c) upon a certificate of the Representative of the holders of Senior Debt or,
if there is no Representative, the holders of Senior Debt for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Senior Debt and other Debt of SFC, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article 11. 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 Debt to participate in any payment
or distribution pursuant to this Article 11, the Trustee may request such Person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of such Senior Debt 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 11, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment. The provisions of Section 7.01 and Section 7.02 shall be applicable to
all actions or omissions of actions by the Trustee pursuant to this Article 11.
SECTION 11.14. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder by accepting a Note 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 Holders and the holders
of Senior Debt as provided in this Article 11 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 11.15. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt and shall not be liable to any such holders if it shall
mistakenly pay over or distribute to Holders or SFC or any other Person, money
or assets to which any holders of Senior Debt shall be entitled by virtue of
this Article 11 or otherwise, except if such mistake was the result of the
Trustee's gross negligence or willful misconduct.
SECTION 11.16. RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION PROVISIONS.
Each Holder by accepting a Note 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 Debt, whether such Senior Debt
was created or acquired before or after the issuance of the Notes, to acquire
and continue to hold, or to continue to hold, such Senior Debt and such holder
of such Senior Debt shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Debt.
ARTICLE 12.
SUBORDINATION OF GUARANTEES
SECTION 12.01. AGREEMENT TO SUBORDINATE.
Each Guarantor agrees, and each Holder by accepting a Note
agrees, that the Obligations of such Guarantor are subordinated in right of
payment, to the extent and in the manner provided in this Article 12 and subject
to the provisions of Article 8 hereof, to the payment when due in cash of all
Senior Debt of such Guarantor and that the subordination is for the benefit of
and enforceable by the holders of such Senior Debt. The Obligations of a
Guarantor shall in all respects rank pari passu with any future Senior
Subordinated Debt of such Guarantor and senior to all existing and future
Subordinated Debt of such Guarantor, and only Senior Debt of the Guarantor shall
rank senior to the Obligations of such Guarantor in accordance with the
provisions set forth herein. All references to "Obligations" in this Article 12
are to Obligations of the Guarantors under the Guarantees.
SECTION 12.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY.
(a) Upon any payment or distribution of the assets of any
Guarantor to creditors upon a liquidation, dissolution or winding up of such
Guarantor or in a bankruptcy, reorganization, insolvency, receivership
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or similar proceeding relating to such Guarantor or its property or upon an
assignment for the benefit of the Guarantor's creditors or the marshaling of its
assets and liabilities, holders of Senior Debt of such Guarantor shall be
entitled to receive payment in full in cash of such Senior Debt before Holders
shall be entitled to receive any payment pursuant to any Obligations of such
Guarantor, except that Holders of Notes may receive and retain such payments
made in Permitted Junior Securities.
(b) Until the Senior Debt of any Guarantor is paid in full in
cash, any distribution made by or on behalf of such Guarantor to which Holders
would be entitled but for this Article 12 shall be made to holders of such
Senior Debt as their interests may appear, except that Holders of Notes may
receive and retain payments made in Permitted Junior Securities; provided that
(i) no Holder of the Notes shall have the right to receive and retain any such
Permitted Junior Securities if the existence of such right would have the effect
of causing the Notes to be treated in the same class of claims as the Senior
Debt of the Guarantor or any class of claims which is pari passu with such
Senior Debt and (ii) holders of Senior Debt of the Guarantor shall be entitled
to receive any cash payments made to any Holder of Notes on the account of
Permitted Junior Securities until all Obligations in respect of Senior Debt of
the Guarantor have been paid in full in cash).
SECTION 12.03. DEFAULT ON SENIOR DEBT OF GUARANTOR.
No Guarantor may make any payment pursuant to any of its
Obligations (collectively, "PAY ITS GUARANTEE") if (a) any principal, premium,
interest or other amount payable in respect of any Senior Debt of such Guarantor
is not paid within any applicable grace period (including at maturity) or (b)
any other default on Senior Debt of such Guarantor occurs and the maturity of
such Senior Debt is accelerated in accordance with its terms unless, in either
case, (1) the default has been cured or waived and any such acceleration has
been rescinded or (2) such Senior Debt has been paid in full in cash; provided,
however, that any Guarantor may pay its Guarantee without regard to the
foregoing if such Guarantor and the Trustee receive written notice approving
such payment from the Representative of the holders of such issue of Senior Debt
of such Guarantor or, if there is no Representative, from the holders of such
Senior Debt of such Guarantor. No Guarantor may pay its Guarantee during the
continuance of any Payment Blockage Period after receipt by SFC and the Trustee
of a Payment Blockage Notice under Section 11.03. Unless the Representative of
the holders of such issue of Designated Senior Debt giving such Payment Blockage
Notice or, if there is no Representative, the holders of such Designated Senior
Debt shall have accelerated the maturity of such Designated Senior Debt and not
rescinded such acceleration, any Guarantor shall resume (unless otherwise
prohibited as described in the first two sentences of this paragraph) payments
pursuant to its Guarantee after the end of such Payment Blockage Period.
SECTION 12.04. DEMAND FOR PAYMENT.
If a demand for payment is made on a Guarantor pursuant to
Article 10, such Guarantor may not pay its Guarantee until three Business Days
after the Representative of the holders of all issues of Designated Senior Debt
or, if there is no Representative, the holders of such Designated Senior Debt,
receive notice of such acceleration and, thereafter, may pay its Guarantee only
if this Indenture otherwise permits payment at that time.
SECTION 12.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If a payment or distribution is made to Holders that because of
this Article 12 should not have been made to them, the Trustee or the Holders
who receive the distribution shall hold it in trust for holders of the relevant
Senior Debt (pro rata as to each of such holders on the basis of the respective
amounts of Senior Debt of the Guarantors held by them) and pay it over to them
or their Representatives as their interests may appear.
SECTION 12.06. SUBROGATION.
After all Senior Debt of a Guarantor is paid in full and until
the Notes are paid in full, Holders shall be subrogated (equally and ratably
with all other Debt that is pari passu with the Guarantors) to the rights of
holders of Senior Debt of such Guarantor to receive distributions applicable to
Senior Debt of such Guarantor to the extent that distributions otherwise payable
to the Holders have been applied to the payment of Senior Debt of the Guarantor.
A distribution made under this Article 12 to holders of such Senior Debt that
otherwise would have been
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made to Holders is not, as between the relevant Guarantor and Holders, a payment
by such Guarantor on such Senior Debt.
SECTION 12.07. RELATIVE RIGHTS.
This Article 12 defines the relative rights of Holders and
holders of Senior Debt of a Guarantor. Nothing in this Indenture shall:
(a) impair, as between a Guarantor and Holders, the obligation of
such Guarantor, which is absolute and unconditional, to pay the Obligations to
the extent set forth in Article 10;
(b) affect the relative rights of Holders and creditors of SFC
other then their rights in relation to holders of Senior Debt of a Guarantor; or
(c) prevent the Trustee or any Holder from exercising its
available remedies upon a default by such Guarantor under the Obligations,
subject to the rights of holders of Senior Debt of such Guarantor to receive
distributions otherwise payable to Holders.
SECTION 12.08. SUBORDINATION MAY NOT BE IMPAIRED BY GUARANTOR.
No right of any holder of Senior Debt of any Guarantor to enforce
the subordination of the Obligation 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.
SECTION 12.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 12.03, the Trustee or Paying Agent may
continue to make payments on any Guarantee 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 five Business Days prior to the date of such
payment, a Responsible Officer receives written notice satisfactory to it that
payments may not be made under this Article 12. SFC, the relevant Guarantor, the
Registrar or co-registrar, the Paying Agent, a Representative or a holder of
Senior Debt of any Guarantor may give the notice; provided, however, that, if an
issue of Senior Debt of any Guarantor has a Representative, only the
Representative may give the notice.
The Trustee in its individual or any other capacity may hold
Senior Debt of a Guarantor with the same rights it would have if it were not
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 Debt of any Guarantor that may at any
time be held by it, to the same extent as any other holder of Senior Debt of a
Guarantor; 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 a distribution is to be made or a notice given to
holders of Senior Debt of any Guarantor, the distribution may be made and the
notice given to their Representative (if any).
SECTION 12.11. ARTICLE 12 NOT TO PREVENT EVENTS OF DEFAULT UNDER A GUARANTEE OR
LIMIT RIGHT TO DEMAND PAYMENT.
Nothing in this Article 12 shall prevent a default under any
Guarantee or have any effect on the right of the Holders or the Trustee to make
a demand for payment on any Guarantor pursuant to Article 10.
SECTION 12.12. TRUSTEE ENTITLED TO RELY.
Upon any payment or distribution pursuant to this Article 12, the
Trustee and the Holders shall be entitled to rely (i) upon any order or decree
of a court of competent jurisdiction in which any proceedings of the
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nature referred to in Section 12.02 are pending, (ii) upon a certificate of the
liquidating trustee or agent or other Person making such payment or distribution
to the Trustee or to the Holders or (iii) upon a certificate of the
Representative of the holders of Senior Debt of any Guarantor or, if there is no
Representative, the holders of such Senior Debt for the purpose of ascertaining
the Persons entitled to participate in such payment or distribution, the holders
of Senior Debt of any Guarantor and other Debt 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 Debt of any Guarantor to
participate in any payment or distribution pursuant to this Article 12, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt 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 may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment. The provisions of Section
7.01 and Section 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 Holder by accepting a Note 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 Holders and the holders
of Senior Debt 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 DEBT OF GUARANTOR.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt of any Guarantor and shall not be liable to any such
holders if it shall mistakenly pay over or distribute to Holders or SFC or any
other Person, money or assets to which any holders of such Senior Debt shall be
entitled by virtue of this Article 12 or otherwise, except if such mistake was
the result of the Trustee's gross negligence or willful misconduct.
SECTION 12.15. RELIANCE BY HOLDERS OF SENIOR DEBT OF A GUARANTOR ON
SUBORDINATION PROVISIONS.
Each Holder by accepting a Note 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 Debt of any Guarantor, whether
such Senior Debt was created or acquired before or after the issuance of the
Notes, to acquire and continue to hold, or to continue to hold, such Senior Debt
and such holder of Senior Debt shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Debt.
ARTICLE 13.
SATISFACTION AND DISCHARGE
SECTION 13.01. SATISFACTION AND DISCHARGE.
This Indenture will be discharged and will cease to be of further
effect, except as to surviving rights of registration of transfer or exchange of
the Notes, as to all Notes issued hereunder, when:
(a) either:
(i) all Notes that have been previously authenticated
(except lost, stolen or destroyed Notes that have been replaced or paid
and Notes for whose payment money has previously been deposited in trust
or segregated and held in trust by SFC and is thereafter repaid to SFC or
discharged from the trust) have been delivered to the Trustee for
cancellation; or
95
(ii) all Notes that have not been previously delivered to
the Trustee for cancellation (A) have become due and payable or (B) will
become due and payable at their maturity within one year or (C) are to be
called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of a notice of redemption by the Trustee, and
SFC has irrevocably deposited or caused to be deposited with the Trustee
as trust funds in trust solely for the benefit of the Holders, cash in
U.S. dollars, non-callable U.S. Government Securities, or a combination
thereof, in such amounts, in the opinion of a firm of independent public
accountants of recognized international standing, as will be sufficient
without consideration of any reinvestment of interest, to pay and
discharge the entire Debt on the Notes not previously delivered to the
Trustee for cancellation for principal, premium, if any, and interest and
Special Interest, if any, on the Notes to the date of deposit, in the case
of Notes that have become due and payable, or to the Stated Maturity or
redemption date, as the case may be;
(b) SFC has paid or caused to be paid all other sums payable by
it under this Indenture; and
(c) SFC delivers to the Trustee an Officers' Certificate and
Opinion of Counsel stating that all conditions precedent under this Indenture
relating to the satisfaction and discharge of this Indenture have been
satisfied.
SECTION 13.02. DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 13.03 hereof, all cash and non-callable U.S.
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
13.02, the "Trustee") pursuant to Section 13.01 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including SFC acting as Paying
Agent) as the Trustee may determine, to the Holders of such Notes of all sums
due and to become due thereon in respect of principal, premium, if any, and
interest and Special Interest, if any, but such cash and securities need not be
segregated from other funds except to the extent required by law.
SECTION 13.03. REPAYMENT TO SFC.
Any cash or non-callable U.S. Government Securities deposited
with the Trustee or any Paying Agent, or then held by SFC, in trust for the
payment of the principal of, premium, if any, or interest or Special Interest,
if any, on, any Note and remaining unclaimed for two years after such principal,
and premium, if any, or interest or Special Interest, if any, has become due and
payable shall be paid to SFC on its request or (if then held by SFC) shall be
discharged from such trust; and the Holder shall thereafter, as an unsecured
creditor, look only to SFC for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such cash and securities, and all liability
of SFC as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of SFC cause to be published once, in The New York Times and
The Wall Street Journal (national edition), notice that such cash and securities
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such cash and securities then remaining will be repaid to
SFC.
ARTICLE 14.
CONVERSION OF NOTES
SECTION 14.01. CONVERSION PRIVILEGE AND CONVERSION RATE.
(a) Subject to and upon compliance with the provisions of this
Article 14, a Holder of a Note may convert all or any portion thereof that is an
integral multiple of $1.00 principal amount into the Principal Return and Net
Share Amount, if any, at any time following the IPO Effective Date and prior to
the close of business on the Business Day immediately preceding the Final
Maturity Date, at the Conversion Rate then in effect.
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(b) Notes in respect of which a Change of Control Repurchase
Notice has been delivered may not be surrendered for conversion pursuant to this
Article 14 prior to a valid withdrawal of such Change of Control Repurchase
Notice in accordance with the provisions of Article 3. Notes in respect of which
an Asset Sale Offer purchase election has been delivered may not be surrendered
for conversion pursuant to this Article 14 prior to a valid withdrawal of such
Asset Sale Offer purchase election in accordance with the provisions of Article
3.
(c) Provisions of this Indenture that apply to conversion of all
of a Note also apply to the conversion of a portion of such Note.
(d) A Holder of Notes is not entitled to any rights of a holder
of Common Stock until such Holder has converted its Notes, and then only to the
extent that upon such conversion the Holder will be entitled to receive Net
Shares in respect of which SFC has not elected to deliver cash in lieu thereof
in accordance with the provisions of this Article 14.
(e) The Conversion Rate shall be adjusted in certain instances as
provided in Section 14.05.
(f) By delivering the Principal Return and Net Share Amount, if
any, upon conversion of a Note to the Trustee, SFC will be deemed to have
satisfied its obligation to pay the principal amount of the Notes so converted
and its obligation to pay accrued and unpaid interest, and Special Interest, if
any, attributable to the period from the most recent Interest Payment Date
through the Conversion Date (which amount will be deemed paid in full rather
than cancelled, extinguished or forfeited).
SECTION 14.02. CONVERSION PROCEDURE.
(a) To convert a Note, a Holder must (1) complete and manually
sign the irrevocable notice of conversion on the back of the Note and deliver
such notice to the Conversion Agent, (2) surrender the Note to the Conversion
Agent, (3) furnish appropriate endorsements and transfer documents if required
by the Registrar or the Conversion Agent, and (4) pay all transfer or similar
taxes, if required pursuant to Section 14.03. The date on which the Holder
satisfies all of those requirements is the "CONVERSION DATE" and the surrendered
Notes shall be deemed to have been converted immediately prior to the close of
business on the Conversion Date. As promptly as practicable after the Conversion
Date, but in no event later than four Business Days after the Determination
Date, SFC shall deliver to the Holders through the Conversion Agent (1) cash in
respect of the Principal Return, (2) if applicable, the number of whole shares
of Common Stock issuable in respect of the Net Share Amount or cash in lieu
thereof, and (3) cash in lieu of any fractional shares pursuant to Section
14.07.
Anything herein to the contrary notwithstanding, in the case of
Global Notes, conversion notices must be delivered and such Notes must be
surrendered for conversion in accordance with the Applicable Procedures.
(b) Upon conversion of a Note, such Person shall no longer be a
Holder of such Note. In the event that any Net Shares are issued upon conversion
of a Note, the Person in whose name the Note is registered shall be deemed to be
a holder of record of the Common Stock comprising such Net Shares on the
Conversion Date; provided, that no surrender of a Note on any date when the
stock transfer books of SFC shall be closed shall be effective to constitute the
Person or Persons entitled to receive the shares of Common Stock comprising such
Net Shares as the record holder or holders of such shares of Common Stock on
such date, but such surrender shall be effective to constitute the Person or
Persons entitled to receive such shares of Common Stock as the record holder or
holders thereof for all purposes at the close of business on the next succeeding
day on which such stock transfer books are open; provided further that such
conversion shall be at the Conversion Rate in effect on the date that such Note
shall have been surrendered for conversion, as if the stock transfer books of
SFC had not been closed.
(c) No payment or adjustment will be made for accrued but unpaid
interest, including Special Interest, if any, on a converted Note or for
dividends or distributions on shares of Common Stock issued upon conversion of a
Note. SFC shall not adjust the Conversion Rate to account for the accrued but
unpaid interest. Nonetheless, if Notes are converted after the close of business
on a Regular Record Date and prior to the opening of business on the next
Interest Payment Date, including the Final Maturity Date, Holders of such Notes
at the close of business on such Regular Record Date shall receive the accrued
but unpaid interest including Special Interest, if any, payable on such Notes on
the corresponding Interest Payment Date notwithstanding the conversion. In such
event,
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such Note, when surrendered for conversion, must be accompanied by delivery of a
check payable to the Conversion Agent in an amount equal to the accrued but
unpaid interest, including Special Interest, if any, payable on such Interest
Payment Date on the portion so converted (provided that if any such interest is
payable in PIK Notes, the check shall include payment for such PIK Notes based
on the principal amount of such PIK Notes). If such payment does not accompany
such Note, the Note shall not be converted, provided that no such check shall be
required if such Note has been called for redemption on a redemption date within
the period between the close of business on such Regular Record Date and the
opening of business on such Interest Payment Date, or if such Note is
surrendered for conversion on the Interest Payment Date. If SFC defaults in the
payment of interest including Special Interest, if any, payable on the Interest
Payment Date, the Conversion Agent shall repay such funds to the Holder.
(d) In the case of any Note which is converted in part only, upon
such conversion SFC shall execute and the Trustee shall authenticate and deliver
to the Holder thereof upon receipt of an Authentication Order, without service
charge, a new Note or Notes of authorized denominations in an aggregate
principal amount equal to, and in exchange for, the unconverted portion of the
principal amount of such Note. A Note may be converted in part, but only if the
principal amount of such part is an integral multiple of $1.00 and the principal
amount of such Note to remain outstanding after such exchange is equal to $1.00
or any integral multiple thereof.
SECTION 14.03. TAXES ON CONVERSION.
If a Holder converts a Note, the Holder shall pay any transfer, stamp or
similar taxes or duties related to the issue or delivery of shares of Common
Stock upon such conversion. The Holder shall also pay any such tax with respect
to cash received in lieu of fractional shares. In addition, the Holder shall pay
any such tax which is due because the Holder requests the shares to be issued in
a name other than the Holder's name. The Conversion Agent may refuse to deliver
the certificate representing the Common Stock being issued in a name other than
the Holder's name until the Conversion Agent receives a sum sufficient to pay
any tax which will be due because the shares are to be issued in a name other
than the Holder's name. Nothing herein shall preclude any tax withholding
required by law or regulation.
SECTION 14.04. SFC TO PROVIDE STOCK.
(a) SFC shall, prior to the IPO Effective Date, and from time to
time as may be necessary, reserve, out of its authorized but unissued Common
Stock, a sufficient number of shares of Common Stock in order to satisfy its
obligation to deliver the Net Shares upon conversion of Notes.
(b) All shares of Common Stock delivered upon conversion of the
Notes shall be newly issued shares or treasury shares, shall be duly authorized,
validly issued, fully paid and nonassessable and shall be free from preemptive
or similar rights and free of any lien or adverse claim as the result of any
action by SFC.
(c) SFC will endeavor promptly to comply with all federal and state
securities laws regulating the offer and delivery of shares of Common Stock upon
conversion of Notes.
SECTION 14.05. ADJUSTMENT OF CONVERSION RATE.
(a) The Conversion Rate shall be adjusted from time to time (without
duplication) by SFC as follows:
(i) If SFC shall pay a dividend or make a distribution to all
holders of outstanding Common Stock in shares of Common Stock, the
Conversion Rate in effect immediately prior to the record date for the
determination of stockholders entitled to receive such dividend or other
distribution shall be increased so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior
to such record date by a fraction of which the numerator shall be the sum
of the number of shares of Common Stock outstanding at the close of
business on such record date plus the total number of shares of Common
Stock constituting such dividend or other distribution and of which the
denominator shall be the number of shares of Common Stock outstanding at
the close of business on such record date. Such adjustment shall be made
successively whenever any such dividend or distribution is made and shall
become effective immediately after such record date. For the purpose of
this clause (i), the number of
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shares of Common Stock at any time outstanding shall not include shares
held in the treasury of SFC. SFC will not pay any dividend or make any
distribution on Common Stock held in the treasury of SFC. If any dividend
or distribution of the type described in this clause is declared but not
so paid or made, the Conversion Rate shall again be adjusted to the
Conversion Rate that would then be in effect if such dividend or
distribution had not been declared.
(ii) If SFC shall subdivide its outstanding Common Stock into
a greater number of shares, or combine its outstanding Common Stock into a
smaller number of shares, the Conversion Rate in effect immediately prior
to the day upon which such subdivision or combination becomes effective
shall be, in the case of a subdivision of Common Stock, proportionately
increased and, in the case of a combination of Common Stock,
proportionately reduced. Such adjustment shall be made successively
whenever any such subdivision or combination of the Common Stock occurs
and shall become effective immediately after the date upon which such
subdivision or combination becomes effective.
(iii) If SFC shall issue rights, warrants or options to all
holders of its outstanding Common Stock entitling them for a period
expiring within 45 days after such issuance to subscribe for or purchase
shares of Common Stock (or securities convertible into Common Stock) at a
price per share (or having a conversion price per share) less than the
Current Market Price per share of Common Stock (as determined in
accordance with clause (vii) of this Section 14.05(a)) on the record date
for the determination of stockholders entitled to receive such rights,
warrants or options, the Conversion Rate in effect immediately prior
thereto shall be adjusted so that the same shall equal the rate determined
by multiplying the Conversion Rate in effect immediately prior to such
record date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on such record
date plus the number of additional shares of Common Stock offered (or into
which the exchangeable or convertible securities so offered are
exchangeable or convertible) and of which the denominator shall be the
number of shares of Common Stock outstanding at the close of business on
such record date plus the number of shares which the aggregate offering
price of the total number of shares of Common Stock so offered for
subscription or purchase (or the aggregate exchange or conversion price of
the exchangeable or convertible securities so offered for subscription or
purchase, which shall be determined by multiplying the number of shares of
Common Stock issuable upon exchange or conversion of such exchangeable or
convertible securities by the exchange or conversion price per share of
Common Stock pursuant to the terms of such exchangeable or convertible
securities) would purchase at the Current Market Price per share of Common
Stock on such record date. Such adjustment shall be made successively
whenever any such rights, warrants or options are issued, and shall become
effective immediately after such record date. If at the end of the period
during which such rights, options or warrants (or securities exchangeable
or convertible into Common Stock) are exercisable, not all rights,
warrants or options (or securities exchangeable or convertible into Common
Stock) shall have been exercised, the Conversion Rate shall be readjusted
to the Conversion Rate that would then be in effect had the adjustments
made upon the issuance of such rights, warrants or options been made on
the basis of delivery of only the number of Common Shares actually
delivered. If such rights, warrants or options are not so issued, the
Conversion Rate shall again be adjusted to be the Conversion Rate that
would then be in effect if the record date for the determination of
stockholders entitled to receive such rights, warrants or options had not
been fixed. In determining whether any rights, warrants or options entitle
the stockholders to subscribe for or purchase shares of Common Stock at a
price less than the Current Market Price per share of Common Stock and in
determining the aggregate offering price of the total number of shares of
Common Stock so offered, there shall be taken into account any
consideration received by SFC for such rights, warrants or options and any
amount payable on exercise or exchange thereof, the value of such
consideration, if other than cash, to be determined by its Board of
Directors.
(iv) If SFC shall make a dividend or other distribution to all
holders of its Common Stock of securities or other property (including
evidences of indebtedness or other assets and cash when the dividend or
distribution is not paid exclusively in cash), including shares of Capital
Stock or similar equity instruments (excluding (v) any dividend or
distribution of Common Stock for which an adjustment was made pursuant to
Section 14.05(a)(i), (w) any subdivision or combination of Common Stock
for which an adjustment was made pursuant to Section 14.05(a)(ii), (x) any
issuance of rights, warrants or options for which an adjustment was made
pursuant to Section 14.05(a)(iii), (y) any dividend or distribution paid
exclusively in cash for which an adjustment was made pursuant to Section
14.05(a)(v) and (z) any
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distribution of Spinoff Securities to which the provisions of the second
succeeding paragraph would apply) (the "DISTRIBUTED SECURITIES"), then in
each such case (unless SFC distributes such Distributed Securities for
distribution to the Holders of Notes on such dividend or distribution date
in an amount per Note equal to the amount of Distributed Securities
distributed in respect of one share of Common Stock multiplied by the
Conversion Rate), the Conversion Rate in effect immediately prior to the
record date fixed for the determination of stockholders entitled to
receive such dividend or distribution shall be adjusted so that the same
shall equal the rate determined by multiplying the Conversion Rate in
effect immediately prior to such record date by a fraction of which the
numerator shall be the Current Market Price per share of the Common Stock
on such record date and of which the denominator shall be Current Market
Price per share on such record date less the fair market value (as
determined by the Board of Directors of SFC, whose determination shall be
conclusive evidence of such fair market value and which shall be evidenced
by an Officers' Certificate delivered by SFC to the Trustee) on such
record date of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock (determined on the basis of the
number of shares of Common Stock outstanding at the close of business on
such record date). Such adjustment shall be made successively whenever any
such distribution is made and shall become effective immediately after the
record date for the determination of stockholders entitled to receive such
distribution. In the event that such dividend or distribution is not so
paid or made, effective as of the date the Board of Directors determines
not to make such distribution, the Conversion Rate shall again be adjusted
to be the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared.
If the then fair market value (as so determined) of the portion of
the Distributed Securities so distributed applicable to one share of
Common Stock is equal to or greater than the Current Market Price per
share of the Common Stock on such record date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each holder of a Note
shall have the right to receive upon conversion the amount of Distributed
Securities applicable to one share of Common Stock multiplied by the
Conversion Rate on such record date. If the Board of Directors of SFC
determines the fair market value of any distribution for purposes of this
Section 14.05(a)(iv) by reference to the actual or when issued trading
market for any Notes, it must in doing so consider the prices in such
market over the same period used in computing the Current Market Price of
the Common Stock.
Notwithstanding the foregoing, if the securities distributed by SFC
to all holders of its Common Stock consist of capital stock of, or similar
equity interests in, a Subsidiary or other business unit of SFC (the
"SPINOFF SECURITIES"), SFC shall make an equivalent distribution to the
Holders the Notes and, on the date the Spinoff Securities are issued, SFC
shall deliver to Holders, in respect of each Note, the number of Spinoff
Securities applicable to one share of Common Stock multiplied by the
Conversion Rate in effect on the record date with respect to such
distribution.
(v) If SFC shall, by dividend or otherwise, at any time
following the IPO Effective Date, distribute (a "TRIGGERING DISTRIBUTION")
to all holders of its Common Stock a payment consisting exclusively of
cash (excluding any dividend or distribution in connection with the
liquidation, dissolution or winding up of SFC, whether voluntary or
involuntary), the Conversion Rate shall be increased so that the same
shall equal the rate determined by multiplying such Conversion Rate in
effect immediately prior to the close of business on the record date for
such Triggering Distribution (a "TRIGGERING DETERMINATION DATE") by a
fraction of which the numerator shall be such Current Market Price per
share of the Common Stock on the Triggering Determination Date and the
denominator of which shall be the Current Market Price per share of the
Common Stock on the Triggering Determination Date less the amount of such
cash dividend or distribution applicable to one share of Common Stock
(determined on the basis of the number of shares of Common Stock
outstanding at the close of business on the Triggering Determination Date,
such increase to become effective immediately prior to the opening of
business on the day following the date on which the Triggering
Distribution is paid. In the event that such dividend or distribution is
not so paid or made, the Conversion Rate shall again be adjusted to be the
Conversion Rate that would then be in effect if such divided or
distribution had not been declared.
(vi) If any tender offer made by SFC or any of its
Subsidiaries for all or any portion of Common Stock shall expire, then, if
the tender offer shall require the payment to stockholders of
consideration per share of Common Stock having a fair market value
(determined as provided below) that exceeds the Closing Price per share of
Common Stock on the Trading Day next succeeding the last date
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(the "EXPIRATION DATE") tenders could have been made pursuant to such
tender offer (as it may be amended) (the last time at which such tenders
could have been made on the Expiration Date is hereinafter sometimes
called the "EXPIRATION TIME"), the Conversion Rate shall be increased so
that the same shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the close of business on
the Expiration Date by a fraction of which the numerator shall be the sum
of (A) the fair market value of the aggregate consideration (the fair
market value as determined by the Board of Directors of SFC, whose
determination shall be conclusive evidence of such fair market value and
which shall be evidenced by an Officers' Certificate delivered to the
Trustee) payable to stockholders based on the acceptance (up to any
maximum specified in the terms of the tender offer) of all shares of
Common Stock validly tendered and not withdrawn as of the Expiration Time
(the shares deemed so accepted, up to any such maximum, being referred to
as the "PURCHASED SHARES") and (B) the product of the number of shares of
Common Stock outstanding (less any Purchased Shares and excluding any
shares held in the treasury of SFC) at the Expiration Time and the Closing
Price per share of Common Stock on the Trading Day next succeeding the
Expiration Date and the denominator of which shall be the product of the
number of shares of Common Stock outstanding (including Purchased Shares
but excluding any shares held in the treasury of SFC) at the Expiration
Time multiplied by the Closing Price per share of the Common Stock on the
Trading Day next succeeding the Expiration Date, such increase to become
effective immediately prior to the opening of business on the day
following the Expiration Date. In the event that SFC is obligated to
purchase shares pursuant to any such tender offer, but SFC is permanently
prevented by applicable law from effecting any or all such purchases or
any or all such purchases are rescinded, the Conversion Rate shall again
be adjusted to be the Conversion Rate which would have been in effect
based upon the number of shares actually purchased, if any. If the
application of this clause (vi) of Section 14.05(a) to any tender offer
would result in a decrease in the Conversion Rate, no adjustment shall be
made for such tender offer under this clause (vi). For purposes of this
Section 14.05, the term "TENDER OFFER" shall mean and include both tender
offers and exchange offers, all references to "PURCHASES" of shares in
tender offers (and all similar references) shall mean and include both the
purchase of shares in tender offers and the acquisition of shares pursuant
to exchange offers, and all references to "TENDERED SHARES" (and all
similar references) shall mean and include shares tendered in both tender
offers and exchange offers.
(vii) For the purpose of any computation under this Section
14.05(a), the current market price (the "CURRENT MARKET PRICE") per share
of Common Stock on any date shall be calculated by SFC and be the average
of the Closing Prices for the 20 consecutive Trading Days ending on the
earlier of (A) the Triggering Determination Date with respect to
distributions under Section 14.05(a)(v) or the Expiration Date, with
respect to tender offers under Section 14.05(a)(vi) or (B) unless
otherwise specified by an applicable provision of this Section 14.05, the
"ex-date" with respect to distributions, issuances or other events
requiring such computation under this Section 14.05. For purposes of this
paragraph, the term "ex-date," when used with respect to any issuance or
distribution, means the first date on which the Common Stock trades
regular way in the applicable securities market or on the applicable
securities exchange without the right to receive such issuance or
distribution.
(b) For purposes of this Section 14.05, "RECORD DATE" shall mean,
with respect to any dividend, distribution or other transaction or event in
which the holders of Common Stock have the right to receive any cash, securities
or other property or in which the Common Stock (or other applicable security) is
converted or exchanged into any combination of cash, securities or other
property, the date fixed for determination of stockholders entitled to receive
such cash, security or other property (whether or not such date is fixed by the
Board of Directors of SFC or by statute, contract or otherwise).
(c) If one or more events occurs requiring an adjustment be made to
the Conversion Rate for a particular period, adjustments to the Conversion Rate
shall be determined by SFC's Board of Directors to reflect the combined impact
of such Conversion Rate adjustment events, as set out in this Section 14.05,
during such period.
SECTION 14.06. NO ADJUSTMENT.
(a) No adjustment in the Conversion Rate shall be required if
Holders may participate in the transactions set forth in Section 14.05 above to
the same extent as if the Notes had been converted into Common Stock immediately
prior to such transactions.
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(b) No adjustment in the Conversion Rate shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Conversion Rate as last adjusted; provided, however, that any adjustments which
would be required to be made but for this Section 14.06(b) shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article 14 shall be made to the nearest cent or to the nearest
one-ten thousandth of a share, as the case may be, with one half cent and
0.00005 of a share, respectively, being rounded upward.
(c) No adjustment in the Conversion Rate shall be required for
issuances of Common Stock pursuant to an SFC plan for reinvestment of dividends
or interest, any other present or future employee benefits plan of program or
for a change in the par value or a change to no par value of the Common Stock.
(d) To the extent that the Notes become convertible into the right
to receive cash, no adjustment need be made thereafter as to the cash.
SECTION 14.07. FRACTIONAL SHARES.
SFC will not issue fractional shares of Common Stock upon conversion of
Notes. If more than one Note shall be surrendered for conversion at one time by
the same Holder, the number of full Net Shares, if any, that shall be issuable
upon conversion shall be computed on the basis of the aggregate principal amount
of the Notes (or specified portions thereof to the extent permitted hereby) so
surrendered. In lieu of any fractional shares, SFC will pay an amount in cash
for the current market value of the fractional shares. The current market value
of a fractional share shall be determined (calculated to the nearest 1/100th of
a share) by multiplying the Market Price of the Common Stock by such fractional
share and rounding the product to the nearest whole cent.
SECTION 14.08. NOTICE OF ADJUSTMENT.
Whenever the Conversion Rate or conversion privilege is required to be
adjusted pursuant to this Indenture, SFC shall promptly mail to Holders a notice
of the adjustment and file with the Trustee an Officers' Certificate briefly
stating the facts requiring the adjustment and the manner of computing it.
Failure to mail such notice or any defect therein shall not affect the validity
of any such adjustment. Unless and until the Trustee shall receive an Officers'
Certificate from SFC setting forth an adjustment of the Conversion Rate, the
Trustee may assume without inquiry that the Conversion Rate has not been
adjusted and that the last Conversion Rate of which it has knowledge remains in
effect.
SECTION 14.09. NOTICE OF CERTAIN TRANSACTIONS.
In case:
(a) SFC shall take any action which would require an adjustment in
the Conversion Rate;
(b) there shall occur any event to which the provisions of Section
14.10 shall apply; or
(c) the voluntary or involuntary dissolution, liquidation or
winding-up of SFC shall occur;
SFC shall cause to be filed with the Trustee and the Conversion Agent and to be
mailed to each Holder of Notes in accordance with Section 15.02, as promptly as
possible, a notice briefly describing the event and the proposed record or
effective date.
SECTION 14.10. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON
CONVERSION PRIVILEGE.
(a) If any of the following shall occur, namely: (1) any
reclassification or change of shares of Common Stock issuable upon conversion of
the Notes (other than a change in name, par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination or any other transaction or event for which an adjustment is
provided in Section 14.05); (2) any statutory share exchange, consolidation or
merger or combination to which SFC is a party other than a merger in which SFC
is the continuing corporation and which does not result in any reclassification
of, or change (other than in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or combination)
in, outstanding
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shares of Common Stock; or (3) any sale or conveyance of all or substantially
all the property and assets of SFC, directly or indirectly, to any Person, then
SFC, any such successor, purchasing or transferee corporation, as the case may
be, and the Guarantors shall, as a condition precedent to such reclassification,
change, combination, statutory share exchange, consolidation, merger, sale or
conveyance, execute and deliver to the Trustee a supplemental indenture to this
Indenture providing that the Holder of each Note then outstanding shall have the
right to convert such Note (in accordance with the provisions of Section 14.13
(and SFC shall have the right to pay any applicable Make Whole Premium or
portion thereof in shares of Common Stock pursuant to Section 14.14)) as if the
kind and amount of shares of stock and other securities and property (including
cash) receivable in respect of one share of Common Stock upon such
reclassification, change, combination, statutory share exchange, consolidation,
merger, sale or conveyance were one share of Common Stock (assuming the holder
of such share of Common Stock did not exercise any right of election as to the
kind or amount of stock, other securities or other property or assets (including
cash) receivable upon such transaction, and provided that if the kind or amount
of stock, other securities or other property or assets (including cash)
receivable upon such transaction is not the same for each share of Common Stock
in respect of which such rights of election shall not have been exercised, then
the kind and amount shall be deemed to be the kind and amount receivable per
share of Common Stock by a plurality of the nonelecting shares). Such
supplemental indenture shall provide for adjustments of the Conversion Rate and
other appropriate numerical thresholds which shall be as nearly equivalent as
may be practicable to the adjustments of the Conversion Rate provided for in
this Article 14. If, in the case of any such consolidation, merger, combination,
statutory share exchange, sale or conveyance, the stock or other securities and
property (including cash) receivable thereupon by a holder of Common Stock
include shares of stock or other securities and property of a Person other than
the successor, purchasing or transferee corporation, as the case may be, in such
consolidation, merger, combination, statutory share exchange, sale or
conveyance, then such supplemental indenture shall also be executed by such
other Person and shall contain such additional provisions to protect the
interests of the Holders of the Notes as the Board of Directors of SFC shall
reasonably consider necessary by reason of the foregoing. The provisions of this
Section 14.10 shall similarly apply to successive reclassifications, changes,
combinations, consolidations, mergers, sales or conveyances. If this Section
14.10(a) applies to any event or occurrence, Section 14.05 shall not apply.
(b) In the event a supplemental indenture is executed pursuant to
this Section 14.10, SFC shall promptly file with the Trustee (i) an Officers'
Certificate briefly stating the reasons therefor, the kind or amount of shares
of stock or other securities or property (including cash) by reference to which
Holders of the Notes may convert their Notes in accordance with Section 14.13
after such reclassification, change, combination, consolidation, merger, sale or
conveyance, any adjustment to be made with respect thereto and that all
conditions precedent have been complied with and (ii) an Opinion of Counsel that
all conditions precedent thereto and hereunder have been complied with, and
shall promptly mail notice thereof to all Holders. Failure to mail such notice
or any defect therein shall not effect the validity of such transaction and such
supplemental indenture.
SECTION 14.11. TRUSTEE'S DISCLAIMER.
(a) The Trustee shall have no duty to determine when an adjustment
under this Article 14 should be made, how it should be made or what such
adjustment should be, but may accept as conclusive evidence of that fact or the
correctness of any such adjustment, and shall be protected in relying upon, an
Officers' Certificate, including the Officers' Certificate with respect thereto
which SFC is obligated to file with the Trustee pursuant to Section 14.08. The
Trustee makes no representation as to the validity or value of any securities or
assets issued upon conversion of Notes, and the Trustee shall not be responsible
for SFC's failure to comply with any provisions of this Article 14.
(b) The Trustee shall not be under any responsibility to determine
the correctness of any provisions contained in any supplemental indenture
executed pursuant to Section 14.10, but may accept as conclusive evidence of the
correctness thereof, and shall be fully protected in relying upon, the Officers'
Certificate and Opinion of Counsel with respect thereto which SFC is obligated
to file with the Trustee pursuant to Section 14.10.
SECTION 14.12. VOLUNTARY INCREASE.
SFC from time to time may increase the Conversion Rate, to the
extent permitted by law, by any amount for any period of time if the period is
at least 20 days (or such longer period as may be required by law), the increase
is irrevocable during the period and the Board of Directors of SFC determines
that such increase would be
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in the best interests of SFC or to avoid or diminish income tax to holders of
shares of Common Stock in connection with a dividend or distribution of stock or
similar event, and SFC provides 15 days' prior written notice of any increase in
the Conversion Rate to the Trustee and the Holders.
SECTION 14.13. PAYMENT UPON CONVERSION
(a) Holders surrendering Notes for conversion shall be entitled to
receive, in respect of each $1.00 principal amount of such Notes:
(i) an amount in cash (the "PRINCIPAL RETURN") equal to the
lesser of (A) the Conversion Value and (B) the principal amount of such
Notes; and
(ii) if the Conversion Value is greater than the principal
amount of such Note, a number of shares of Common Stock (the "NET SHARES")
equal to the sum of the Daily Share Amounts for each Trading Day during
the applicable Conversion Reference Period; provided that, in lieu of the
delivery of Net Shares, SFC may, at its option deliver cash or a
combination of cash and shares of Common Stock as set forth in Section
14.13(b) (such amount of cash or stock or combination thereof, the "NET
SHARE AMOUNT").
(b) SFC may elect to pay cash to the Holders of Notes surrendered
for conversion in lieu of all or any portion of the Net Shares, if any,
otherwise issuable pursuant to Section 14.13(a). In such event, the amount of
cash payable in respect of such Net Shares shall equal the product of
(i) the percentage of each Net Share to which SFC's election
to pay cash in lieu of delivery thereof shall apply,
(ii) the number of Net Shares otherwise issuable upon
conversion of such Notes pursuant to Section 14.13(a), and
(iii) the average of the Closing Prices of the Common Stock
for each of the 20 consecutive Trading Days of the Conversion Reference
Period, appropriately adjusted to take into account the occurrence during
such period of stock splits and similar events.
SFC shall inform the Holders through the Trustee no later than two
Business Days following the Conversion Date relating to any Notes of its
election to deliver cash in lieu of all or any portion of the Net Shares
issuable upon conversion of such Notes, which notice shall state, if applicable,
the percentage of each Net Share to be paid in cash.
The Conversion Value, Principal Return, number of Net Shares and Net
Share Amount shall be determined by SFC on the Business Day next following the
last Trading Day of the applicable Conversion Reference Period (the
"DETERMINATION DATE").
(c) SFC shall pay and, as applicable, deliver the Conversion
Consideration as promptly as practicable after the Determination Date, but in no
event no later than four Business Days thereafter.
(d) Neither the Trustee nor the Conversion Agent has any duty to
determine or calculate the Conversion Value, Principal Return, number of Net
Shares, the Net Share Amount or any other computation required under this
Article 14, all of which shall be determined by SFC in accordance with the
provisions of this Indenture, and the Trustee and the Conversion Agent shall not
be under any responsibility to determine the correctness of any such
determinations and/or calculations and may conclusively rely on the correctness
thereof.
(e) SFC may satisfy its obligation to pay the Conversion
Consideration and the Make Whole Premium, if any, with respect to Notes properly
surrendered for conversion pursuant to this Article 14 by arranging for the
purchase and transfer of such Notes, in lieu of the conversion of such Notes,
pursuant to an agreement with a financial institution or other third party
(collectively, a "THIRD PARTY PURCHASER") whereby the Third Party Purchaser will
purchase such Notes for consideration equal to the Conversion Consideration and
the Make Whole
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Premium, if any, which consideration will be payable in the form set forth in
the notice delivered by SFC to the Trustee pursuant to Section 14.13(b). If SFC
elects to satisfy its payment obligation in connection with such conversion
pursuant to an arrangement described in the immediately preceding sentence, then
such Notes shall remain outstanding and shall not be converted; provided that
nothing contained herein shall prevent the Notes transferred to the Third Party
Purchaser from being converted pursuant to the terms of this Article 14; and
provided further that, subject to the last sentence of this clause (e), nothing
contained in this clause (e) shall relieve SFC of its obligation to pay the
Conversion Consideration and the Make Whole Premium, if any, as required
pursuant to this Article 14. If the Third Party Purchaser pays the Conversion
Consideration and the Make Whole Premium, if any, with respect to Notes properly
surrendered for conversion pursuant to this Article 14, then the obligation of
SFC to pay the Conversion Consideration and the Make Whole Premium, if any, with
respect to such Notes shall be deemed satisfied and discharged in full.
SECTION 14.14. MAKE WHOLE PREMIUM UPON CHANGE OF CONTROL.
(a) If, after the IPO Effective Date but prior to the Final Maturity
Date, there shall have occurred a Change of Control of SFC and more than 10% of
the consideration for the Common Stock in the transaction or transactions
constituting the Change of Control consists of cash (other than cash payments
for fractional shares and cash payments made in respect of dissenters' appraisal
rights) or securities (or other property) that are not traded or scheduled to be
traded immediately after the Change of Control Effective Date on a national
securities exchange or the NASDAQ National Market, then SFC shall pay a "MAKE
WHOLE PREMIUM" to the Holders of the Notes that are converted pursuant to this
Article 14 during the period beginning 10 Trading Days before the anticipated
Change of Control Effective Date and ending on the Change of Control Payment
Date. The Make Whole Premium shall be an amount determined by reference to the
tables set forth in Section 14.14(c) for the applicable Conversion Price of the
Note following the IPO Effective Date and will be based on the Change of Control
Effective Date of such Change of Control and the Stock Price with respect to
such Change of Control as a percentage of the IPO Price (the "STOCK PRICE
PERCENTAGE"). Any Make Whole Premium payable pursuant to this Section 14.14
shall be paid at the same time that the Conversion Consideration payable upon
conversion is paid or delivered. If the Stock Price Percentage is less than
100%, no Make Whole Premium is payable, and if the Stock Price Percentage is
greater than 400%, no additional Make Whole Premium is payable.
(b) The "STOCK PRICE" means, in connection with a Change of Control
in which holders of Common Stock receive only cash, the amount of cash paid per
share of Common Stock in connection with such Change of Control, and in all
other cases means the average of the Closing Prices of the Common Stock for the
20 Trading Days ending on the Trading Day immediately preceding the Change of
Control Effective Date.
(c) The following tables set forth the Make Whole Premiums for the
applicable Stock Price Percentages and Change of Control Effective Dates
expressed as percentages of the principal amount of the Notes to be converted.
In the event that the Stock Price Percentage is between two Stock Price
Percentage amounts shown on the table below or the Change of Control Effective
Date is between two Change of Control Effective Dates, the Make Whole Premium
will be determined by a straight-line interpolation between the Make Whole
Premiums set forth for the higher and lower Stock Price Percentage amounts and
the two dates, as applicable, based on a 365-day year.
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STOCK PRICE AS % OF IPO PRICE
CONVERSION PRICE = IPO PRICE x 1.3
CHANGE OF CONTROL DATE
3/11/2005 3/11/2006 3/11/2007 3/11/2008 3/11/2009 3/11/2010
--------- --------- --------- --------- --------- ---------
100% 25.0 23.2 23.1 23.1 23.1 0.0
115% 22.5 19.9 17.2 14.6 12.9 0.0
130% 20.8 17.6 14.1 10.2 7.0 0.0
145% 19.6 16.0 11.9 7.2 2.6 0.0
160% 18.8 14.9 10.5 5.3 0.1 0.0
175% 18.2 14.2 9.6 4.1 0.0 0.0
190% 17.8 13.7 9.0 3.5 0.0 0.0
205% 17.6 13.4 8.6 3.1 0.0 0.0
220% 17.4 13.2 8.4 2.9 0.0 0.0
235% 17.3 13.0 8.3 2.9 0.0 0.0
250% 17.2 12.9 8.2 2.8 0.0 0.0
265% 17.1 12.9 8.1 2.8 0.0 0.0
280% 17.1 12.8 8.1 2.8 0.0 0.0
295% 17.0 12.8 8.1 2.8 0.0 0.0
310% 17.0 12.8 8.0 2.8 0.0 0.0
325% 17.0 12.8 8.0 2.8 0.0 0.0
340% 17.0 12.7 8.0 2.8 0.0 0.0
355% 17.0 12.7 8.0 2.8 0.0 0.0
370% 17.0 12.7 8.0 2.8 0.0 0.0
385% 16.9 12.7 8.0 2.8 0.0 0.0
400% 16.9 12.7 8.0 2.8 0.0 0.0
106
STOCK PRICE AS % OF IPO PRICE
CONVERSION PRICE = IPO PRICE x 1.25
CHANGE OF CONTROL DATE
3/11/2006 3/11/2007 3/11/2008 3/11/2009 3/11/2010
--------- --------- --------- --------- ---------
100% 22.2 20.3 20.0 20.0 0.0
115% 19.1 16.1 13.1 10.9 0.0
130% 16.9 13.2 9.1 5.3 0.0
145% 15.5 11.3 6.4 1.3 0.0
160% 14.6 10.1 4.7 0.0 0.0
175% 13.9 9.3 3.8 0.0 0.0
190% 13.5 8.8 3.3 0.0 0.0
205% 13.3 8.5 3.0 0.0 0.0
220% 13.1 8.3 2.9 0.0 0.0
235% 13.0 8.2 2.8 0.0 0.0
250% 12.9 8.1 2.8 0.0 0.0
265% 12.8 8.1 2.8 0.0 0.0
280% 12.8 8.1 2.8 0.0 0.0
295% 12.8 8.0 2.8 0.0 0.0
310% 12.8 8.0 2.8 0.0 0.0
325% 12.8 8.0 2.8 0.0 0.0
340% 12.7 8.0 2.8 0.0 0.0
355% 12.7 8.0 2.8 0.0 0.0
370% 12.7 8.0 2.8 0.0 0.0
385% 12.7 8.0 2.8 0.0 0.0
400% 12.7 8.0 2.8 0.0 0.0
107
STOCK PRICE AS % OF IPO PRICE
CONVERSION PRICE = IPO PRICE x 1.20
CHANGE OF CONTROL DATE
3/11/2007 3/11/2008 3/11/2009 3/11/2010
--------- --------- --------- ---------
100% 19.0 17.1 16.7 0.0
115% 15.1 11.7 8.9 0.0
130% 12.4 7.9 3.7 0.0
145% 10.7 5.6 0.4 0.0
160% 9.7 4.2 0.0 0.0
175% 9.0 3.5 0.0 0.0
190% 8.6 3.1 0.0 0.0
205% 8.4 2.9 0.0 0.0
220% 8.2 2.8 0.0 0.0
235% 8.1 2.8 0.0 0.0
250% 8.1 2.8 0.0 0.0
265% 8.1 2.8 0.0 0.0
280% 8.0 2.8 0.0 0.0
295% 8.0 2.8 0.0 0.0
310% 8.0 2.8 0.0 0.0
325% 8.0 2.8 0.0 0.0
340% 8.0 2.8 0.0 0.0
355% 8.0 2.8 0.0 0.0
370% 8.0 2.8 0.0 0.0
385% 8.0 2.8 0.0 0.0
400% 8.0 2.8 0.0 0.0
108
STOCK PRICE AS % OF IPO PRICE
CONVERSION PRICE = IPO PRICE x 1.15
CHANGE OF CONTROL DATE
3/11/2008 3/11/2009 3/11/2010
--------- --------- ---------
100% 16.9 14.1 0.0
115% 13.0 8.3 0.0
130% 10.7 5.2 0.0
145% 9.5 3.8 0.0
160% 8.8 3.2 0.0
175% 8.4 2.9 0.0
190% 8.2 2.8 0.0
205% 8.1 2.8 0.0
220% 8.1 2.8 0.0
235% 8.1 2.8 0.0
250% 8.1 2.8 0.0
265% 8.0 2.8 0.0
280% 8.0 2.8 0.0
295% 8.0 2.8 0.0
310% 8.0 2.8 0.0
325% 8.0 2.8 0.0
340% 8.0 2.8 0.0
355% 8.0 2.8 0.0
370% 8.0 2.8 0.0
385% 8.0 2.8 0.0
400% 8.0 2.8 0.0
109
STOCK PRICE AS % OF IPO PRICE
CONVERSION PRICE = IPO PRICE x 1.1
CHANGE OF CONTROL DATE
3/11/2009 3/11/2010
--------- ---------
100% 12.0 0.0
115% 7.0 0.0
130% 4.5 0.0
145% 3.4 0.0
160% 3.0 0.0
175% 2.9 0.0
190% 2.8 0.0
205% 2.8 0.0
220% 2.8 0.0
235% 2.8 0.0
250% 2.8 0.0
265% 2.8 0.0
280% 2.8 0.0
295% 2.8 0.0
310% 2.8 0.0
325% 2.8 0.0
340% 2.8 0.0
355% 2.8 0.0
370% 2.8 0.0
385% 2.8 0.0
400% 2.8 0.0
110
The IPO Price will be adjusted as of any date on which the
Conversion Rate of the Notes is adjusted. The adjusted IPO Price will equal the
IPO Price applicable immediately prior to such adjustment multiplied by a
fraction, the numerator of which is the Conversion Rate immediately prior to the
adjustment giving rise to the IPO Price adjustment and the denominator of which
is the Conversion Rate as so adjusted.
(d) (i) The Make Whole Premium may be paid for, in whole or in part,
at the election of SFC, in (A) cash, (B) shares of Common Stock, or (C) in any
combination of cash and shares of Common Stock, subject to the condition set
forth in Section 14.14(d)(iv). SFC shall notify Holders converting Notes to whom
a Make Whole Premium shall be payable no later than two Business Days following
the applicable Conversion Date whether SFC will pay the Make Whole Premium in
cash or shares of Common Stock or, if in a combination thereof, the percentage
of the Make Whole Premium that it will pay in cash and the percentage that it
will pay in shares of Common Stock; provided that SFC will pay cash for
fractional interests in shares of Common Stock in an amount based upon the
Market Price. For purposes of determining the amount of any fractional
interests, all Notes converted shall be considered together (no matter how many
separate certificates are to be presented).
(ii) SFC may not change its election with respect to the
consideration (or components or percentages of components thereof) to be
paid once SFC has given notice of such election pursuant to the preceding
paragraph.
(iii) If SFC elects to pay the Make Whole Premium, or any
percentage thereof, in shares of Common Stock, the number of shares of
Common Stock to be delivered with respect to each $1.00 principal amount
of Notes shall be equal to the quotient obtained by dividing (x) the
dollar amount of the Make Whole Premium per $1.00 principal amount of
Notes to be paid in shares of Common Stock by (ii) 98% of the Market
Price; provided that no fractional shares will be delivered.
(iv) SFC's right to elect to pay some or all of the Make Whole
Premium by delivering shares of Common Stock shall be conditioned upon SFC
giving timely notice of its election and not having previously given
notice of an election to pay the Make Whole Premium entirely in cash. If
this condition is not met, SFC shall pay the entire Make Whole Premium in
cash.
(v) All shares of Common Stock delivered in respect of the
Make Whole Premium shall be newly issued shares, shall be duly authorized,
validly issued, fully paid and nonassessable, and shall be free from
preemptive rights and free of any lien or adverse claim.
(vi) If a holder is paid some or all of Make Whole Premium in
shares of Common Stock, SFC shall pay any documentary, stamp or similar
issue or transfer tax due on such issue of Common Stock; provided that the
holder shall pay any such tax which is due because the holder requests the
Common Stock to be issued in a name other than that of the holder. The
Trustee may refuse to deliver the certificates representing the shares of
Common Stock being issued in a name other than the holder's name until the
Trustee receives a sum sufficient to pay any tax which will be due because
the shares of Common Stock are to be issued in a name other than the
holder's name. Nothing herein shall preclude any income tax withholding
required by law or regulations.
SECTION 14.15. APPLICABILITY.
No provision of this Article 14 shall be applicable, and no
adjustment to the Conversion Rate shall be made with respect to any of the
transactions or events described in Section 14.05(a) that occur or with respect
to which a record date is established, prior to the IPO Effective Date.
111
ARTICLE 15.
MISCELLANEOUS
SECTION 15.01. 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 provision required by the TIA shall control.
SECTION 15.02. NOTICES.
Any notice or communication by SFC, HoldCo 3 or the Trustee to the
other is duly given if in writing and delivered in person or mailed by first
class mail (registered or certified, return receipt requested), telecopier or
overnight air courier guaranteeing next-day delivery, to the other's address:
If to SFC:
Swift Foods Company
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopier No.: (000) 000-0000
If to HoldCo 3:
S&C Holdco 3, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopier No.: (000) 000-0000
With a copy to:
Xxxxxx & Xxxxxx L.L.P.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopier No.: (000) 000-0000
If to the Trustee:
The Bank of New York Trust Company, N.A.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxxxxx
Telecopier No.: (000) 000-0000
SFC, Holdco 3 or the Trustee, by notice to the other, may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to the
Trustee) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next-day delivery. All notices and communications to the
Trustee shall be deemed duly given and effective only upon receipt.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next-day delivery to its address shown
112
on the Security Register. Any notice or communication shall also be so mailed to
any Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If SFC mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
SECTION 15.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. SFC, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
SECTION 15.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by SFC to the Trustee to take any
action under any provision of this Indenture, SFC shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 14.08 and Section 14.10 hereof, if applicable) stating that, in the
opinion of the signers, all conditions precedent and covenants, if any, provided
for in this Indenture relating to the proposed action have been complied with;
and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 14.08 and Section 14.10 hereof, if applicable) stating that, in the
opinion of such counsel, all such conditions precedent and covenants have been
complied with.
SECTION 15.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
With respect to matters of fact, an Opinion of Counsel may rely on
an Officers' Certificate or certificates of public officials.
SECTION 15.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
113
SECTION 15.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator
or stockholder of SFC or any Guarantor, as such, shall have any liability for
any obligations of SFC or of the Guarantors under the Notes, this Indenture, the
Guarantees or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
SECTION 15.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 15.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of SFC or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 15.10. SUCCESSORS.
All covenants and agreements of SFC, HoldCo 3 and the other
Guarantors in this Indenture and the Notes shall bind its successors. All
covenants and agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 15.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 15.12. COUNTERPART 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.
SECTION 15.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings in this
Indenture have been inserted for convenience of reference only, are not to be
considered a part of this Indenture and shall in no way modify or restrict any
of the terms or provisions hereof.
SECTION 15.14. QUALIFICATION OF THIS INDENTURE.
SFC shall qualify this Indenture under the TIA in accordance with
the terms and conditions of the Registration Rights Agreement and shall pay all
reasonable costs and expenses (including attorneys' fees and expenses for SFC,
the Trustee and the Holders) incurred in connection therewith, including, but
not limited to, costs and expenses of qualification of this Indenture and the
Notes and printing this Indenture and the Notes. The Trustee shall be entitled
to receive from SFC any such Officers' Certificates, Opinions of Counsel or
other documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
[Signatures on following page]
114
SIGNATURES
Dated as of March 11, 2005
ISSUER:
SWIFT FOODS COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President, General
Counsel and Secretary
GUARANTOR:
S&C HOLDCO 3, INC.
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President, General
Counsel and Secretary
SIGNATURE PAGES TO SUBORDINATED NOTE INDENTURE TRUSTEE:
THE BANK OF NEW YORK TRUST COMPANY, N.A.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
2
EXHIBIT A
(Face of Note)
10.25% CONVERTIBLE SENIOR SUBORDINATED NOTES DUE 2010
CUSIP NO. $____________
____________
____________
____________
SWIFT FOODS COMPANY
promises to pay to [ ] (1) or registered assigns, the principal sum of
_______________ Dollars ($______________) on March 11, 2010.
Interest Payment Dates: May 1 and November 1, commencing November 1, 2005.
Record Dates: April 15 and October 15.
Dated: March 11, 2005.
FOR PURPOSES XX XXXXXXXX 0000, 0000 XXX 0000 XX XXX XXXXXX XXXXXX INTERNAL
REVENUE CODE OF 1986, AS AMENDED, AND THE UNITED STATES TREASURY REGULATIONS
PROMULGATED THEREUNDER, THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT. IN
ADDITION, THIS NOTE IS SUBJECT TO THE TREASURY REGULATIONS GOVERNING CONTINGENT
PAYMENT DEBT INSTRUMENTS. A HOLDER OF THIS NOTE MAY OBTAIN INFORMATION REGARDING
THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, YIELD TO MATURITY,
COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE OF THIS NOTE BY SUBMITTING A
WRITTEN REQUEST FOR SUCH INFORMATION TO: SWIFT FOODS COMPANY, CHIEF FINANCIAL
OFFICER, 0000 XXXXXXXXXX XXXXXX, XXXXXXX, XXXXXXXX 00000, SUCH INFORMATION TO BE
MADE AVAILABLE NO LATER THAN 10 DAYS AFTER THE ISSUE DATE, PROMPLTY UPON
REQUEST.
----------
(1) Insert CEDE & CO., INC. if the Note is to be issued in Global Form.
A-1
IN WITNESS WHEREOF, the Issuer has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
SWIFT FOODS COMPANY
By:__________________________
Name:
Title:
This is one of the Global
Notes referred to in the
within-mentioned Indenture:
THE BANK OF NEW YORK TRUST COMPANY, N.A.,
as Trustee
By: __________________________________
Authorized Signatory
Dated March 11, 2005
A-2
(Back of Note)
10.25% Convertible Senior Subordinated Notes due 2010
[Insert the Global Note Legend, if applicable pursuant to the terms of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the terms of the
Indenture]
[Insert the Regulation S Temporary Global Note Placement Legend, if applicable
pursuant to the terms of the Indenture]
[Insert Definitive Note Legend, if applicable pursuant to the terms of the
Indenture]
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
1. Interest. Swift Foods Company, a Delaware corporation ("SFC" or
"ISSUER"), promises to pay interest until maturity on the principal amount of
this Note (i) prior to the Qualified IPO Effective Date, at the rate of 10.25%
per annum if interest is paid in cash and at the rate of 11.25% per annum if
interest is paid in the form of PIK Notes as provided in Section 4.01 of the
Indenture and (ii) on and after the Qualified IPO Effective Date, at the rate of
6.00% per annum in cash, and shall pay Special Interest, if any, as provided in
the Registration Rights Agreement. SFC shall pay interest semi-annually on May 1
and November 1 of each year, or if any such day is not a Business Day, on the
next succeeding Business Day (each an "INTEREST PAYMENT DATE"); provided, that
the first Interest Payment Date shall be the first of May 1 or November 1, 2005
to occur after the date of issuance, unless such May 1 or November 1 occurs
within two calendar months of such date of issuance, in which case the first
Interest Payment Date shall be the second of May 1 and November 1 to occur after
the date of issuance. Interest on the Notes (other than PIK Notes) shall accrue
from the most recent date to which interest has been paid or, if no interest has
been paid, from the date of issuance. Interest on each PIK Note shall accrue
from the Interest Payment Date in respect of which such PIK Note was issued or
deemed issued under the Indenture. SFC shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time at a rate that is 1% per annum
in excess of the interest rate then in effect under the Indenture and this Note;
it shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest and Special Interest, if
any (without regard to any applicable grace periods), from time to time on
demand at the same rate to the extent lawful. If SFC elects to issue PIK Notes
in lieu of cash interest for an Interest Payment Date in accordance with Section
4.01 of the Indenture, and if for any reason one or more PIK Notes shall not be
issued, authenticated and delivered in accordance with the Indenture, such PIK
Notes shall be deemed to have been issued, authenticated and delivered for all
purposes of the Indenture and, in particular, interest shall accrue on this Note
such that the aggregate interest due and payable at maturity and on each
Interest Payment Date would be the same as if all PIK Notes with respect to this
Note not issued, authenticated and delivered had been issued, authenticated and
delivered and the principal payable at maturity with respect to this Note shall
be an amount equal to the sum of the principal outstanding hereunder and the
aggregate principal that would be outstanding if the PIK Notes not issued,
authenticated and delivered had been issued, authenticated and delivered.
Interest shall be computed on the basis of a 360 day year of twelve 30 day
months.
[Until this Regulation S Temporary Global Note is exchanged for one
or more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.](2)
2. Method of Payment. SFC shall pay interest on the Notes (except
defaulted interest) to the Persons in whose name this Note (or one or more
Predecessor Notes) is registered at the close of business on the April 15 or
October 15 next preceding the Interest Payment Date ("REGULAR RECORD DATE"),
even if such Notes are cancelled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.12 of the
----------
(2) To be used for Temporary Regulation S Global Note only.
A-3
Indenture with respect to defaulted interest. The Notes shall be payable as to
principal, premium, if any, and interest and Special Interest, if any, at the
office or agency of SFC maintained for such purpose, or, at the option of SFC,
payment of cash interest may be made by check mailed to the Holders at their
addresses set forth in the Security Register; provided, however, that payment by
wire transfer of immediately available funds shall be required with respect to
principal of and cash interest and cash Special Interest, if any, and premium,
if any, on, all Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to SFC or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
3. Paying Agent, Registrar and Conversion Agent. Initially, The Bank of
New York Trust Company, N.A., the Trustee under the Indenture, shall act as
Paying Agent, Registrar and Conversion Agent. SFC may change any Paying Agent,
Registrar or Conversion Agent without notice to any Holder. SFC or any of its
Subsidiaries may act in any such capacity.
4. Indenture. SFC issued the Notes under an Indenture dated as of March
11, 2005 ("INDENTURE") among SFC, S&C HoldCo 3, Inc. ("HOLDCO 3") and the other
guarantors party thereto (collectively with HoldCo 3, the "GUARANTORS") and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all such
terms, and Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are general obligations of SFC and will be unsecured
except to the extent provided in Section 4.11 of the Indenture. The Notes that
may be issued under the Indenture shall be limited to the Initial Notes, the PIK
Notes and any Notes issued pursuant to Section 2.06, Section 2.07, Section 2.10,
Section 3.06, Section 3.09, Section 4.22, Section 9.06 and Section 14.02(d) of
the Indenture, all of which shall constitute a single class of securities for
purposes of the Indenture.
5. Optional Redemption.
(a) Except as set forth in clause (b) of this Paragraph 5, the Notes
will not be redeemable at the option of SFC prior to the Final Maturity Date.
(b) SFC may redeem all or any portion of the Notes after giving the
required notice under the Indenture:
(i) at once or over time at any time during the 365 consecutive
day period ending on the Final Maturity Date, but only if the
Qualified IPO Effective Date has not occurred prior to such
redemption, at a redemption price equal to 105.125% of the
aggregate principal amount of the Notes to be redeemed; and
(ii) if (A) the Qualified IPO Effective Date is on or prior to
March 11, 2008 and (B) prior to the date a notice of
redemption is sent pursuant to Section 3.07 of the Indenture,
the average of the Closing Price of the Common Stock for each
of ten consecutive Trading Days ending on the date prior to
the date such redemption notice is sent, appropriately
adjusted to take into account stock splits and similar events
that occur, is greater than or equal to 120% of the Conversion
Price, at once or over time at any time during the 365
consecutive day period ending on the Final Maturity Date at a
redemption price equal to 100.00% of the aggregate principal
amount of the Notes to be redeemed;
plus, in either case, accrued and unpaid interest, including Special
Interest, if any, to, but excluding, the redemption date (subject to the
right of Holders of record on the relevant record date to receive interest
due on the relevant Interest Payment Date).
If the Qualified IPO Effective Date does not occur on or prior to March
11, 2008, SFC may not redeem the Notes except as provided in clause (b)(i)
above.
A-4
(c) Any redemption pursuant to this Paragraph 5 shall be made
pursuant to the provisions of Section 3.01 through Section 3.06 of the
Indenture.
6. Mandatory Redemption or Repurchase. Except as set forth in Section
3.09, Section 4.12 and Section 4.18 of the Indenture, SFC shall not be required
to make mandatory redemption payments, repurchase offers or sinking fund
payments with respect to the Notes.
7. Repurchase At Option of Holder.
(a) Upon the occurrence of a Change of Control, each Holder shall
have the right to require SFC to repurchase all or any part (equal to $1.00 or
an integral multiple thereof) of such Holder's Notes (a "CHANGE OF CONTROL
OFFER") at a purchase price in cash equal to (i) during the Restricted Period,
101% of the aggregate principal amount of Notes repurchased or (ii) after the
Restricted Period, 100% of the aggregate principal amount of the Notes
repurchased, in each case, plus accrued and unpaid interest and Special
Interest, on the Notes repurchased to, but excluding, the Change of Control
Payment Date (subject to the right of Holders of record on the relevant record
date to receive interest to, but excluding, the Change of Control Payment Date).
Holders of Notes that are the subject of an offer to purchase will receive a
Change of Control Offer from SFC prior to any related purchase date and may
elect to have such Notes purchased by completing the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Notes.
(b) If HoldCo 3 or one of its Restricted Subsidiaries consummates
any Asset Sale, they shall not be required to apply any Net Available Cash in
accordance with the Indenture until the aggregate Net Available Cash from all
Asset Sales following the date the Notes are first issued exceeds $15.0 million.
Thereafter, once HoldCo 3 or its Restricted Subsidiaries accumulates an
additional aggregate $15.0 million of Net Available Cash from all Asset Sales,
SFC or HoldCo 3 shall, after application of the additional aggregate $15.0
million of Net Available Cash as provided in clause (a)(iii)(A) and (a)(iii)(B)
of Section 4.12 of the Indenture, commence an offer for Notes pursuant to the
Indenture by applying the Net Available Cash in excess of $15.0 million (an
"ASSET SALE OFFER") pursuant to Section 3.09 of the Indenture to purchase the
maximum principal amount of Notes that may be purchased out of the Net Available
Cash at an offer price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest and Special Interest, if any, to the date fixed
for the closing of such offer in accordance with the procedures set forth in the
Indenture. To the extent that the aggregate amount of Notes tendered pursuant to
an Asset Sale Offer is less than the Net Available Cash, HoldCo 3 (or such
Restricted Subsidiary) may use such deficiency for any purpose not prohibited by
the Indenture. If the aggregate principal amount of Notes surrendered by Holders
thereof exceeds the amount of Net Available Cash, the Issuer shall select the
Notes to be purchased in accordance with Section 3.09 of the Indenture. Holders
of Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from HoldCo 3 prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes. To the extent an Asset Sale hereunder
also constitutes an Asset Sale under the OpCo Senior Indenture, the OpCo
Subordinated Indenture or the Senior Notes Indenture, an Asset Sale Offer is
only required to be made out of the proceeds which remain after application of
the proceeds in accordance with the OpCo Senior Indenture, the OpCo Subordinated
Indenture and the Senior Notes Indenture and to the extent that such remaining
proceeds may be paid as a dividend or distribution to the Issuer without
violation of state surplus laws and the terms of the OpCo Senior Indenture, the
OpCo Subordinated Indenture, the Senior Notes Indenture and the Senior Credit
Facilities.
8. Notice of Redemption. Notice of redemption shall be mailed at least 30
days (or in the case of a partial redemption, at least 45 days) but not more
than 60 days before the redemption date to each Holder whose Notes are to be
redeemed at its registered address. Notes in denominations larger than $1.00 may
be redeemed in part but only in integral multiples thereof, unless all of the
Notes held by a Holder are to be redeemed. On and after the redemption date
interest ceases to accrue on Notes or portions thereof called for redemption.
9. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1.00 and integral multiples thereof. This
Note shall represent the aggregate principal amount of outstanding Notes from
time to time endorsed hereon and the aggregate principal amount of Notes
represented hereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. The transfer of Notes may be
registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and SFC may require a Holder to
pay any taxes and fees required by law or permitted by the Indenture. SFC need
not
A-5
exchange or register the transfer of any Note or portion of a Note selected
for redemption, except for the unredeemed portion of any Note being redeemed in
part. Also, SFC need not exchange or register the transfer of any Notes for a
period of 15 days before a selection of Notes to be redeemed or during the
period between a record date and the corresponding Interest Payment Date.
[This Regulation S Temporary Global Note is convertible in whole or
in part for one or more Global Notes only (i) on or after the termination of the
Distribution Compliance Period and (ii) upon presentation of certificates
(accompanied by an Opinion of Counsel, if applicable) required by Article 2 of
the Indenture. Upon exchange of this Regulation S Temporary Global Note for one
or more Global Notes, the Trustee shall cancel this Regulation S Temporary
Global Note.](3)
10. Conversion Value of Notes Tendered. This Note is convertible on the
terms set forth in Article 14 of the Indenture.
11. Persons Deemed Owners. The registered Holder of a Note may be treated
as its owner for all purposes.
12. Amendment, Supplement and Waiver. Subject to certain exceptions, SFC
and the Trustee may amend or supplement the Indenture or the Notes with the
consent of the Holders of a majority in principal amount of the then outstanding
Notes, voting as a single class (including consents obtained in connection with
a purchase of or tender offer or exchange offer for the Notes), and, subject to
Section 6.04 and Section 6.07 of the Indenture, any existing Default or Event of
Default (except a continuing Default or Event of Default in the payment of
principal, premium, if any, interest or Special Interest, if any, on the Notes)
or compliance with any provision of the Indenture or the Notes (except for
certain covenants and provisions of the Indenture which cannot be amended
without the consent of each Holder) may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes then
outstanding voting as a single class (including consents obtained in connection
with a purchase of or tender offer or exchange offer for the Notes). Without the
consent of any Holder, SFC and the Trustee may amend or supplement the Indenture
or the Notes to cure any ambiguity, omission, defect or inconsistency, to
provide for the assumption by a successor corporation, partnership or limited
liability company of the obligations of SFC, HoldCo 3, the other Guarantors or
the Trustee under the Indenture, to provide for uncertificated Notes in addition
to or in place of certificated Notes, to add additional Guarantees or additional
obligors with respect to the Notes, to secure the Notes, to add to the covenants
of SFC, HoldCo 3, the other Guarantors or the Trustee for the benefit of the
Holders of the Notes or to surrender any right or power conferred upon SFC,
HoldCo 3, the other Guarantors or the Trustee, to provide for conversion rights
of Holders if any reclassification or change of Common Stock or any
consolidation, merger or sale of all or substantially all of SFC's property and
assets occurs or otherwise to comply with the provisions of the Indenture in the
event of a merger, consolidation or transfer of assets (including the provisions
of Section 14.10 and Article 5 of the Indenture) to increase the Conversion Rate
(provided that the increase will not materially adversely affect the interests
of Holders), to make any change that does not adversely affect the legal rights
under the Indenture of any such Holder, to make any change to comply with any
requirement of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA, or subject to Section 9.03 of the Indenture,
make any change to the subordination provisions of the Indenture that would
limit or terminate the benefits available to any holder of Senior Debt under
such provisions.
13. Defaults and Remedies. Each of the following is an Event of Default
under the Indenture: (i) the failure to pay interest, including Special
Interest, if any, on the Notes when that interest or Special Interest becomes
due and payable and the Default continues for 30 days; (ii) the failure to pay
principal of or premium, if any, on the Notes when that principal or premium, if
any, becomes due and payable, at maturity, upon redemption or otherwise; (iii)
the failure to deliver when due all cash and shares of Common Stock deliverable
upon conversion of the Notes, which failure continues for 15 days; (iv) the
failure to observe or perform any other covenant or agreement contained in the
Notes, the Guarantees or the Indenture (other than Events of Default described
in clauses (vi) and (vii) below), which failure continues for a period of 60
days after SFC receives a written notice specifying the default from the Trustee
or Holders of at least 25% in aggregate principal amount of outstanding Notes;
(v) the failure by SFC, HoldCo 3 or any Restricted Subsidiary to pay Debt at the
final stated maturity, after giving effect to any extensions, or upon the
acceleration of the final stated maturity of that Debt, if the aggregate
principal amount of
----------
(3) To be used for Temporary Regulation S Global Note.
A-6
that Debt, together with the aggregate principal amount of any other such Debt
in default for failure to pay principal at the final stated maturity, after
giving effect to any extensions, or upon the acceleration of the final stated
maturity of that Debt, aggregates $20.0 million or more at any time and such
default shall not have been cured or such acceleration shall not have been
rescinded after a 10-day period; (vi) default in SFC's obligation to repurchase
the Notes at the option of a Holder in connection with a Change of Control
pursuant to Section 4.18 of the Indenture; (vii) failure on the part of SFC to
provide notice of the occurrence of a Change of Control within 90 days after the
occurrence of such Change of Control as required by Section 4.18 of the
Indenture; (viii) one or more judgments in an aggregate amount in excess of
$20.0 million, which judgments are not covered by insurance, or if covered by
insurance, as to which the insurer has disclaimed coverage, being rendered
against SFC or any of its Subsidiaries and such judgment or judgments remain
undischarged, unwaived or unstayed for a period of 60 days after such judgment
or judgments become final and nonappealable (provided that this clause (viii),
prior to such time as SFC either becomes the maker or guarantor of the Seller
Note pursuant to the terms of the Seller Note or any notes exchanged for the
Seller Note pursuant to the terms of the Seller Note, shall only relate to a
judgment rendered in respect of the Seller Note if the underlying acceleration
thereof was also an event that was an Event of Default under clause (xi) below);
(ix) certain events of bankruptcy, insolvency or reorganization affecting SFC,
HoldCo 3, HoldCo 2 or any of SFC's Significant Subsidiaries; (x) the Guarantee
of HoldCo 3 or any Guarantee of a Significant Subsidiary of SFC (A) ceases to be
in full force and effect (B) is declared to be null and void and unenforceable
by a judicial determination, or (C) is found to be invalid by a judicial
determination or any Guarantor denies its obligations under its Guarantee (in
each case, other than by reason of release of a Guarantor in accordance with the
terms of the Indenture); (xi) prior to such time as SFC either becomes the maker
or the guarantor of the Seller Note pursuant to the terms of the Seller Note or
any notes exchanged for the Seller Note pursuant to the terms of Seller Note,
the acceleration of HoldCo 2's obligations under the Seller Note upon the
occurrence of an event described in clauses (i) or (iii) of the definition of
"Event of Default" in the Seller Note (provided that in the case of an event of
default described in clause (i) of such definition, such acceleration is for a
reason other than an event of default described in clause (ii) of such
definition); and (xii) after such time as SFC either becomes the maker or the
guarantor of the Seller Note pursuant to the terms of the Seller Note or any
notes exchanged for the Seller Note pursuant to the terms of the Seller Note,
the acceleration of SFC's or HoldCo 2's obligations under the Seller Note.
If any Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency described in the Indenture, all outstanding Notes shall become due
and payable without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in aggregate principal amount of the then
outstanding Notes may direct the Trustee in its exercise of any trust or power.
The Trustee may withhold from Holders notice of any continuing Default or Event
of Default (except a Default or Event of Default relating to the payment of
principal or interest or Special Interest) if it determines in accordance with
the Indenture that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest or
Special Interest on, or the principal of, the Notes. SFC is required to deliver
to the Trustee annually a statement regarding compliance with the Indenture, and
SFC is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
14. Trustee Dealings With SFC. Subject to certain limitations, the Trustee
in its individual or any other capacity may become the owner or pledgee of Notes
and may otherwise deal with SFC or any Affiliate of SFC with the same rights it
would have if it were not Trustee.
15. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator or stockholder of SFC or of any Guarantor, as
such, shall have any liability for any obligations of SFC or any Guarantor under
the Indenture, the Notes, the Guarantees or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability.
16. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
A-7
17. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
18. Additional Rights of Holders of Restricted Global Notes and Restricted
Definitive Notes. In addition to the rights provided to Holders of Notes under
the Indenture, Holders of Restricted Global Notes and Restricted Definitive
Notes that are Initial Notes shall have all the rights set forth in the
Registration Rights Agreement, dated as of March 11, 2005, among SFC and the
parties named on the signature pages thereto.
19. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, SFC has caused CUSIP
numbers to be printed on the Notes and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
SFC shall furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Swift Foods Company
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
20. Governing Law. The internal law of the State of New York shall govern
and be used to construe this Note without giving effect to applicable principals
of conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby.
A-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by SFC pursuant to Section
4.12, or Section 4.18 of the Indenture, check the box below:
[ ] Section 4.12
[ ] Section 4.18
If you want to elect to have only part of the Note purchased by SFC pursuant to
Section 4.12 or Section 4.18 of the Indenture, state the amount you elect to
have purchased: $___________
Date: Your Signature:
(Sign exactly as your name appears on the Note)
Tax Identification No.:________________________
SIGNATURE GUARANTEE:
_______________________________________________
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.
A-9
OPTION OF HOLDER TO ELECT CONVERSION
If you want to elect to convert all or part of this Note pursuant to Section
14.01 of the Indenture, state the principal amount you elect to convert:
$_____________
Date: Your Signature:
(Sign exactly as your name appears on the Note)
Tax Identification No.:________________________
SIGNATURE GUARANTEE:
_______________________________________________
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.
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to
________________________________________________________________________________
(Insert assignee's social security or other tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint____________________________________________ as agent to
transfer this Note on the books of SFC. The agent may substitute another to act
for him.
________________________________________________________________________________
Date: Your Signature:
(Sign exactly as your name appears on the face
of this Note)
Signature Guarantee:
A-11
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:
Principal Amount of
this Global Note Signature of
following such Amount of Decrease Amount of Increase Authorized
Decrease(or in Principal Amount in Principal Amount Signatory of Trustee
Increase) of this Global Note of this Global Note Date of Exchange or Note Custodian
------------------- ------------------- ------------------- ---------------- --------------------
A-12
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Swift Foods Company
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
The Bank of New York Trust Company, N.A.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10.25% Convertible Senior Subordinated Notes due 2010
Reference is hereby made to the Indenture, dated as of March 11,
2005 (the "INDENTURE"), among Swift Foods Company, as issuer ("SFC"), S&C Holdco
3, Inc. and the other Guarantors party thereto and The Bank of New York Trust
Company, N.A., as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
___________________, (the "TRANSFEROR") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"TRANSFER"), to __________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO REGULATION S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby further
certifies that (i) the Transfer is not being made to a Person in the United
States and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the
proposed transfer is being made prior to the expiration of the Distribution
Compliance Period, the transfer is not being made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an Initial Purchaser). Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note
B-1
will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note, the Temporary
Regulation S Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY PROVISION
OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to SFC or a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements
of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the
Transferor hereby further certifies that it has not engaged in any general
solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive
Notes and the requirements of the exemption claimed, which certification
is supported by (1) a certificate executed by the Transferee in the form
of Exhibit D to the Indenture and (2) if such Transfer is in respect of a
principal amount of Notes at the time of transfer of less than $250,000,
an Opinion of Counsel provided by the Transferor or the Transferee (a copy
of which the Transferor has attached to this certification), to the effect
that such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the IAI Global Note and/or the Definitive
Notes and in the Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained
in the Indenture and any applicable blue sky securities laws of any state
of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order
to maintain compliance with the Securities Act. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will no longer be
subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904
under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of
any state of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
B-2
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will no
longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on
Restricted Definitive Notes and in the Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule
144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of
any State of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will not
be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of SFC.
_______________________________________
[Insert Name of Transferor]
By:___________________________________
Name:
Title:
Dated:________________________________
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE OF (a), (b) OR (c)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(iv) [ ] Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Swift Foods Company
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
The Bank of New York Trust Company, N.A.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10.25% Convertible Senior Subordinated Notes due 2010
Reference is hereby made to the Indenture, dated as of March 11,
2005 (the "INDENTURE"), among Swift Foods Company, as issuer ("SFC"), S&C Holdco
3, Inc. and the other Guarantors party thereto and The Bank of New York Trust
Company, N.A., as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
__________________________, (the "OWNER") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $___________ in such Note[s] or interests (the "EXCHANGE").
In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a)[ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Note and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(b)[ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Note and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Unrestricted Definitive Note is
being acquired in compliance with any applicable blue sky securities laws of any
state of the United States.
(c)[ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been
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effected in compliance with the transfer restrictions applicable to Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(d)[ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES
(a)[ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b)[ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Definitive Note and pursuant to and in accordance
with the Securities Act, and in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial
interest issued will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the relevant Restricted Global Note and
in the Indenture and the Securities Act.
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This certificate and the statements contained herein are made for
your benefit and the benefit of SFC.
___________________________________
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated:______________
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EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Swift Foods Company
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
The Bank of New York Trust Company, N.A.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10.25% Convertible Senior Subordinated Notes due 2010
Reference is hereby made to the Indenture, dated as of March 11,
2005 (the "INDENTURE"), among Swift Foods Company, as issuer ("SFC"), S&C Holdco
3, Inc. and the other Guarantors party thereto and The Bank of New York Trust
Company, N.A., as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "SECURITIES ACT").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to SFC or any subsidiary thereof, (B) in accordance with
Rule 144A under the Securities Act to a "qualified institutional buyer" (as
defined therein), (C) to an institutional "accredited investor" (as defined
below) that, prior to such transfer, furnishes (or has furnished on its behalf
by a U.S. broker-dealer) to you and to SFC a signed letter substantially in the
form of this letter and, if such transfer is in respect of a principal amount of
Notes, at the time of transfer of less than $250,000, an Opinion of Counsel in
form reasonably acceptable to SFC to the effect that such transfer is in
compliance with the Securities Act, (D) outside the United States in accordance
with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the
provisions of Rule 144(k) under the Securities Act or (F) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any Person purchasing the Definitive Note or beneficial interest
in a Global Note from us in a transaction meeting the requirements of clauses
(A) through (E) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and SFC such
certifications, legal opinions and other information as you and SFC may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
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4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment. We have had access to such financial and other
information and have been afforded the opportunity to ask such questions of
representatives of SFC and receive answers thereto, as we deem necessary in
connection with our decision to purchase the Notes.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion and are not acquiring the Notes with a view to any
distribution thereof in a transaction that would violate the Securities Act of
the securities laws of any state of the United States or any other applicable
jurisdiction.
You and SFC are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. This letter shall be governed by, and
construed in accordance with, the laws of the State of New York.
_________________________________________
[Insert Name of Accredited Investor]
By:_____________________________________
Name:
Title:
Dated:________________
D-2
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any
successor Person under the Indenture), jointly and severally, unconditionally
guarantees, to the extent set forth in the Indenture and subject to the
provisions in the Indenture, dated as of March 11, 2005 ("SFC"), among Swift
Foods Company, as issuer (the "ISSUER"), S&C Holdco 3, Inc. and the other
Guarantors listed on the signature pages thereto and The Bank of New York Trust
Company, as trustee (the "TRUSTEE"), (a) the due and punctual payment of the
principal of, premium, if any, and interest and Special Interest, if any, on the
Notes, whether at maturity, by acceleration, redemption, repurchase or
otherwise, the due and punctual payment of interest on overdue principal and
premium, if any, and, to the extent permitted by law, interest and Special
Interest, if any, and the due and punctual performance of all other obligations
of SFC to the Holders or the Trustee all in accordance with the terms of the
Indenture and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise. The
obligations of the Guarantors to the Holders of Notes and to the Trustee
pursuant to the Guarantee and the Indenture are expressly set forth in Article
10 of the Indenture and reference is hereby made to the Indenture for the
precise terms of the Guarantee. This Guarantee is subject to release as and to
the extent set forth in Section 8.02, Section 8.03 and Section 10.05 of the
Indenture. Each Holder of a Note, by accepting the same agrees to and shall be
bound by such provisions. Capitalized terms used herein and not defined are used
herein as so defined in the Indenture.
S&C HOLDCO 3, INC.
By:
Name:
Title:
E-1
S&C Holdco 3, Inc.
By:________________________________
Name:
Title:
E-2
