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INDENTURE
Dated as of February 1, 0000
Xxxxxxx
XXX-XXX XXXXXXXXXX, XXX.
xxx
XXXXXX XXXXXX TRUST COMPANY OF NEW YORK, Trustee
________________
up to $200,000,000
10% 7/8 Senior Subordinated Notes due 2007
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CROSS-REFERENCE TABLE
Indenture
Trust Indenture Act Section Section
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(S) 310(a)(1).......................................... 7.10
(a)(2)....................................... 7.10
(a)(3)....................................... N.A.
(a)(4)....................................... N.A.
(a)(5)....................................... N.A.
(b).......................................... 7.08; 7.10; 13.02
(c).......................................... N.A.
(S) 311(a)............................................. 7.11
(b).......................................... 7.11
(c).......................................... N.A.
(S) 312(a)............................................. 2.05
(b).......................................... 13.03
(c).......................................... 13.03
(S) 313(a)............................................. 7.06
(b)(1)....................................... N.A.
(b)(2)....................................... 7.06
(c).......................................... 7.06; 13.02
(d).......................................... 7.06
(S) 314(a)............................................. 4.11; 4.12; 13.02
(b).......................................... N.A.
(c)(1)....................................... 13.04
(c)(2)....................................... 13.04
(c)(3)....................................... N.A.
(d).......................................... N.A.
(e).......................................... 13.05
(f).......................................... N.A.
(S) 315(a)............................................. 7.01(b)
(b).......................................... 7.05; 13.02
(c).......................................... 7.01(a)
(d).......................................... 7.01(c)
(e).......................................... 6.11
(S) 316(a)(last sentence).............................. 2.09
(a)(1)(A).................................... 6.05
(a)(1)(B).................................... 6.04
(a)(2)....................................... N.A.
(b).......................................... 6.07
(c).......................................... 10.04
(S) 317(a)(1).......................................... 6.08
(a)(2)....................................... 6.09
(b).......................................... 2.04
(S) 318(a)............................................. 13.01
____________________
N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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Page
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions............................................. 1
SECTION 1.02. Other Definitions....................................... 20
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act........................................ 20
SECTION 1.04. Rules of Construction................................... 21
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating......................................... 22
SECTION 2.02. Execution and Authentication............................ 24
SECTION 2.03. Registrar and Paying Agent.............................. 24
SECTION 2.04. Paying Agent To Hold Money in Trust..................... 25
SECTION 2.05. Securityholder Lists.................................... 25
SECTION 2.06. Transfer and Exchange................................... 26
SECTION 2.07. Replacement Securities.................................. 36
SECTION 2.08. Outstanding Securities.................................. 36
SECTION 2.09. Treasury Securities..................................... 36
SECTION 2.10. Temporary Securities.................................... 37
SECTION 2.11. Cancellation............................................ 37
SECTION 2.12. Defaulted Interest...................................... 37
SECTION 2.13. CUSIP or CINS Number.................................... 38
SECTION 2.14 Payments of Interest.................................... 38
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee...................................... 39
SECTION 3.02. Selection of Securities To Be
Redeemed............................................. 39
SECTION 3.03. Notice of Redemption.................................... 39
SECTION 3.04. Effect of Notice of Redemption.......................... 40
SECTION 3.05. Deposit of Redemption Price............................. 41
SECTION 3.06. Securities Redeemed in Part............................. 41
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities................................... 41
SECTION 4.02. Maintenance of Office or Agency......................... 41
SECTION 4.03. Limitation on Transactions with
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Page
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Affiliates and Related Persons.......................... 42
SECTION 4.04. Limitation on Indebtedness.............................. 43
SECTION 4.05. Limitation on Certain Asset
Dispositions......................................... 45
SECTION 4.06. Limitation on Restricted Payments....................... 47
SECTION 4.07. Corporate Existence..................................... 50
SECTION 4.08. Payment of Taxes and Other Claims....................... 50
SECTION 4.09. Notice of Defaults...................................... 50
SECTION 4.10. Maintenance of Properties............................... 51
SECTION 4.11. Compliance Certificate.................................. 51
SECTION 4.12. Provision of Financial Information...................... 52
SECTION 4.13. Waiver of Stay, Extension or Usury
Laws................................................. 52
SECTION 4.14. Change of Control....................................... 52
SECTION 4.15. Limitation on Senior Subordinated
Indebtedness......................................... 53
SECTION 4.16. Limitations Concerning Distributions
and Transfers by Restricted Subsidiaries............. 54
SECTION 4.17. Limitation on Issuance and Sale of
Capital Stock of Restricted Subsidiaries............. 55
SECTION 4.18. Limitation on Liens..................................... 55
SECTION 4.19. Future Guarantors....................................... 57
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Restriction on Mergers, Consolidations
and Certain Sales of Assets.......................... 57
SECTION 5.02. Successor Corporation Substituted....................... 58
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default....................................... 58
SECTION 6.02. Acceleration............................................ 60
SECTION 6.03. Other Remedies.......................................... 61
SECTION 6.04. Waiver of Past Default.................................. 61
SECTION 6.05. Control by Majority..................................... 62
SECTION 6.06. Limitation on Suits..................................... 62
SECTION 6.07. Rights of Holders To Receive Payment.................... 63
SECTION 6.08. Collection Suit by Trustee.............................. 63
SECTION 6.09. Trustee May File Proofs of Claim........................ 64
SECTION 6.10. Priorities.............................................. 64
SECTION 6.11. Undertaking for Costs................................... 65
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Page
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ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee....................................... 65
SECTION 7.02. Rights of Trustee....................................... 66
SECTION 7.03. Individual Rights of Trustee............................ 68
SECTION 7.04. Trustee's Disclaimer.................................... 68
SECTION 7.05. Notice of Defaults...................................... 68
SECTION 7.06. Reports by Trustee to Holders........................... 68
SECTION 7.07. Compensation and Indemnity.............................. 68
SECTION 7.08. Replacement of Trustee.................................. 69
SECTION 7.09. Successor Trustee by Merger, etc........................ 71
SECTION 7.10. Eligibility; Disqualification........................... 71
SECTION 7.11. Preferential Collection of Claims
Against Company...................................... 71
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior
Debt................................................. 72
SECTION 8.02. No Payment on Securities in Certain
Circumstances........................................ 72
SECTION 8.03. Payment Over of Proceeds upon
Dissolution, etc..................................... 73
SECTION 8.04. Subrogation............................................. 75
SECTION 8.05. Obligations of Company Unconditional.................... 75
SECTION 8.06. Notice to Trustee....................................... 76
SECTION 8.07. Reliance on Judicial Order or
Certificate of Liquidating Agent..................... 77
SECTION 8.08. Trustee's Relation to Senior Debt....................... 77
SECTION 8.09. Subordination Rights Not Impaired by
Acts or Omissions of the Company or
Holders of Senior Debt............................... 78
SECTION 8.10. Securityholders Authorize Trustee To
Effectuate Subordination of
Securities........................................... 78
SECTION 8.11. This Article Not To Prevent Events of
Default.............................................. 78
SECTION 8.12. Trustee's Compensation Not Prejudiced................... 79
SECTION 8.13. No Waiver of Subordination Provisions................... 79
SECTION 8.14. Subordination Provisions Not
Applicable to Money Held in Trust for
Securityholders; Payments May Be Paid
Prior to Dissolution................................. 79
SECTION 8.15. Acceleration of Securities.............................. 80
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Page
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ARTICLE NINE
DISCHARGE OF INDENTURE
SECTION 9.01. Termination of Company's Obligations.................... 80
SECTION 9.02. Application of Trust Money.............................. 82
SECTION 9.03. Repayment to Company.................................... 82
SECTION 9.04. Reinstatement........................................... 83
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.............................. 83
SECTION 10.02. With Consent of Holders................................. 84
SECTION 10.03. Compliance with Trust Indenture Act..................... 86
SECTION 10.04. Revocation and Effect of Consents....................... 86
SECTION 10.05. Notation on or Exchange of Securities................... 87
SECTION 10.06. Trustee To Sign Amendments, etc......................... 87
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee................................. 87
SECTION 11.02. Severability............................................ 88
SECTION 11.03. Release of a Guarantor.................................. 88
SECTION 11.04. Limitation of Guarantor's Liability..................... 89
SECTION 11.05. Contribution............................................ 89
SECTION 11.06. Execution of Guarantee.................................. 90
SECTION 11.07. Subordination of Subrogation and
Other Rights......................................... 90
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated
to Senior Debt of Guarantors......................... 91
SECTION 12.02. No Payment on Guarantees in Certain
Circumstances........................................ 91
SECTION 12.03. Payment Over of Proceeds upon
Dissolution, etc..................................... 92
SECTION 12.04. Subrogation............................................. 94
SECTION 12.05. Obligations of Guarantors Unconditional................. 94
SECTION 12.06. Notice to Trustee....................................... 95
SECTION 12.07. Reliance on Judicial Order or
Certificate of Liquidating Agent..................... 96
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Page
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SECTION 12.08. Trustee's Relation to Senior
Debt of Guarantors................................... 97
SECTION 12.09. Subordination Rights Not Impaired by
Acts or Omissions of the Guarantors or Holders of
Senior Debt of Guarantors............................ 97
SECTION 12.10. Securityholders Authorize Trustee To Effectuate
Subordination of Guarantee........................... 97
SECTION 12.11. This Article Not To Prevent Events of Default........... 98
SECTION 12.12. Trustee's Compensation Not Prejudiced................... 98
SECTION 12.13. No Waiver of Guarantee Subordination Provisions......... 98
SECTION 12.14. Payments May Be Paid Prior to Dissolution............... 98
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls............................ 99
SECTION 13.02. Notices................................................. 99
SECTION 13.03. Communications by Holders with Other Holders............ 101
SECTION 13.04. Certificate and Opinion as to Conditions Precedent...... 101
SECTION 13.05. Statements Required in Certificate or Opinion........... 101
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar............... 102
SECTION 13.07. Governing Law........................................... 102
SECTION 13.08. No Recourse Against Others.............................. 102
SECTION 13.09. Successors.............................................. 102
SECTION 13.10. Counterpart Originals................................... 102
SECTION 13.11. Severability............................................ 103
SECTION 13.12. No Adverse Interpretation of Other Agreements........... 103
SECTION 13.13. Legal Holidays.......................................... 103
SIGNATURES ............................................................. 104
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EXHIBIT A - Form of Security ............................................ A-1
EXHIBIT B - Form of Certificate of Transfer.............................. B-1
EXHIBIT C - Form of Certificate of Exchange.............................. C-1
_________________________
NOTE: This Table of Contents shall not, for any purpose, be deemed to be a
part of this Indenture.
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INDENTURE dated as of February 1, 1997, between PEN-TAB INDUSTRIES,
INC., a Delaware corporation (the "Company"), and the UNITED STATES TRUST
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COMPANY OF NEW YORK, a bank and trust company organized under the New York
Banking Law, as trustee (the Trustee").
Each party hereto agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the Holders of the Company's 10 7/8%
Senior Subordinated Notes due 2007:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.011. Definitions.
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"Acquired Indebtedness" means, with respect to any Person,
---------------------
Indebtedness of such Person (i) existing at the time such Person becomes a
Restricted Subsidiary or (ii) assumed in connection with the acquisition of
assets from another Person, including Indebtedness Incurred in connection with,
or in contemplation of, such Person becoming a Restricted Subsidiary or such
acquisition, as the case may be.
"Affiliate" of any specified Person means any other Person directly or
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indirectly controlling or controlled by or under direct or indirect common
control with any specified Person. For purposes of this definition, "control"
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when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
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"Additional Interest" shall have the meaning set forth in the
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Registration Rights Agreement.
"Agent" means any Registrar, Paying Agent or co-Registrar. See
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Section 2.03.
"Applicable Procedures" means with respect to any transfer or exchange
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of interests in a Global Security, the rules and procedures of DTC, Euroclear or
Cedel that apply to such transfer or exchange.
"Asset Disposition" means any sale, transfer or other disposition
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(including, without limitation, by merger, consolidation or sale-and-leaseback
transaction) of (i) shares of Capital Stock of a Subsidiary of the Company
(other than directors' qualifying shares) or (ii) property or assets of the
Company or any Subsidiary of the Company other than in the
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ordinary course of business; provided, however, that an Asset Disposition shall
not include (a) any sale, transfer or other disposition of shares of Capital
Stock, property or assets by a Restricted Subsidiary of the Company to the
Company or to any Wholly Owned Subsidiary of the Company, (b) any sale, transfer
or other disposition of defaulted receivables for collection or any sale,
transfer or other disposition of property or assets in the ordinary course of
business, (c) any isolated sale, transfer or other disposition that does not
involve aggregate consideration in excess of $500,000 individually, (d) the
grant in the ordinary course of business of any non-exclusive license of
patents, trademarks, registrations therefor and other similar intellectual
property, (e) any Lien (or foreclosure thereon) securing Indebtedness to the
extent that such Lien is granted in compliance with Section 4.18, (f) any
Restricted Payment permitted by Section 4.06, (g) any disposition of assets or
property in the ordinary course of business to the extent such property or
assets are obsolete, wornout or no longer useful in the Company's or any of its
Restricted Subsidiaries' business, (h) the sale, lease, conveyance or
disposition or other transfer of all or substantially all of the assets of the
Company as permitted under Section 5.01; provided, that the assets not so sold,
leased, conveyed, disposed of or otherwise transferred shall be deemed an Asset
Disposition or (i) any disposition that constitutes a Change of Control.
"Average Life" means, as of the date of determination, with respect to
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any Indebtedness for borrowed money or Preferred Stock, the quotient obtained by
dividing (i) the sum of the products of the number of years from the date of
determination to the dates of each successive scheduled principal or liquidation
value payments of such Indebtedness or Preferred Stock, respectively, and the
amount of such principal or liquidation value payments, by (ii) the sum of all
such principal or liquidation value payments.
"Board of Directors" means the Board of Directors of the Company or
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any Guarantor, as the case may be, or any authorized committee of that Board.
"Board Resolution" means, with respect to any Person, a duly adopted
----------------
resolution of the Board of Directors of such Person.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
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Friday that is not a day on which banking institutions in the City of New York
are authorized or obligated by law, resolution or executive order to close.
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"Capital Lease Obligations" of any Person means the obligations to pay
-------------------------
rent or other amounts under a lease of (or other Indebtedness arrangements
conveying the right to use) real or personal property of such Person which are
required to be classified and accounted for as a capital lease or liability on
the face of a balance sheet of such Person in accordance with GAAP. The amount
of such obligations shall be the capitalized amount thereof in accordance with
GAAP and the stated maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be terminated by the lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares, interests,
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participations or other equivalents (however designated) of corporate stock of
such Person (including any Preferred Stock outstanding on the Issue Date).
"Cedel" means Cedel Bank, societe anonyme.
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"Common Stock" of any Person means Capital Stock of such Person that
------------
does not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"Company" means the Person named as the "Company" in the first
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paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
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such successor.
"Company Request" or "Company Order" means a written request or order
--------------- -------------
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Consolidated Cash Flow Available for Fixed Charges" of any Person
--------------------------------------------------
means for any period the Consolidated Net Income of such Person for such period
increased (to the extent Consolidated Net Income for such period has been
reduced thereby) by the sum of (without duplication) (i) Consolidated Interest
Expense of such Person for such period (which, for purposes of this definition,
shall include the amortization of the premiums, fees and expenses referred to in
clause (i) of the second sentence of the definition of GAAP), plus (ii)
Consolidated Income Tax
-4-
Expense of such Person for such period, plus (iii) the consolidated depreciation
and amortization expense included in the income statement of such Person
prepared in accordance with GAAP for such period, plus (iv) any other non-cash
charges to the extent deducted from or reflected in Consolidated Net Income
except for any non-cash charges that represent accruals of, or reserves for,
cash disbursements to be made in any future accounting period.
"Consolidated Cash Flow Ratio" of any Person means for any period the
----------------------------
ratio of (i) Consolidated Cash Flow Available for Fixed Charges of such Person
for such period to (ii) the sum of (A) Consolidated Interest Expense of such
Person for such period, plus (B) the annual interest expense with respect to any
Indebtedness proposed to be Incurred by such Person or its Restricted
Subsidiaries, minus (C) Consolidated Interest Expense of such Person to the
extent included in clause (ii)(A) with respect to any Indebtedness that will no
longer be outstanding as a result of the Incurrence of the Indebtedness proposed
to be Incurred, plus (D) the annual interest expense with respect to any other
Indebtedness Incurred by such Person or its Restricted Subsidiaries since the
end of such period to the extent not included in clause (ii)(A), minus (E)
Consolidated Interest Expense of such Person to the extent included in clause
(ii)(A) with respect to any Indebtedness that no longer is outstanding as a
result of the Incurrence of the Indebtedness referred to in clause (ii)(D);
provided, however, that in making such computation, the Consolidated Interest
Expense of such Person attributable to interest on any Indebtedness bearing a
floating interest rate shall be computed on a pro forma basis as if the rate in
effect on the date of computation (after giving effect to any hedge in respect
of such Indebtedness that will, by its terms, remain in effect until the earlier
of the maturity of such Indebtedness or the date one year after the date of such
determination) had been the applicable rate for the entire period; provided,
further, however, that, in the event such Person or any of its Restricted
Subsidiaries has made any Asset Dispositions or acquisitions of assets not in
the ordinary course of business (including acquisitions of other Persons by
merger, consolidation or purchase of Capital Stock) during or after such period
and on or prior to the date of measurement, such computation shall be made on a
pro forma basis as if the Asset Dispositions or acquisitions had taken place on
the first day of such period. Notwithstanding the previous sentence
Consolidated Interest Expense shall not include the consolidated interest
expense included in a consolidated income statement of such Person for such
period associated with Indebtedness Incurred for working capital purposes
("Working Capital Debt") but shall
--------------------
-5-
include as Consolidated Interest Expense (x) a pro forma interest expense
determined using on the then current weighted average rates in effect on the
date of computation on all Working Capital Debt (or if no such Working Capital
Debt is then outstanding, the rate that would be in effect under the Credit
Agreement) and (y) the average principal amount of Working Capital Debt of such
Person that was outstanding during the four full fiscal quarters for which
quarterly or annual financial statements are available next preceding the date
of computation. Calculations of pro forma amounts in accordance with this
definition shall be done in accordance with Article 11 of Regulation S-X under
the Securities Act or any successor provision and may include reasonably
ascertainable cost savings.
"Consolidated Income Tax Expense" of any Person means for any period
-------------------------------
the consolidated provision for income taxes of such Person for such period
calculated on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" for any Person means for any period,
-----------------------------
without duplication, (a) the consolidated interest expense included in a
consolidated income statement (without deduction of interest or finance charge
income) of such Person and its Restricted Subsidiaries for such period
calculated on a consolidated basis in accordance with GAAP and (b) dividend
requirements of such Person and its Restricted Subsidiaries with respect to
Disqualified Stock and with respect to all other Preferred Stock of Restricted
Subsidiaries of such Person (in each case whether in cash or otherwise (except
dividends payable solely in shares of Capital Stock of such Person or such
Restricted Subsidiary)) paid, declared, accrued or accumulated during such
period times a fraction the numerator of which is one and the denominator of
which is one minus the then effective consolidated Federal, state and local tax
rate of such Person, expressed as a decimal.
"Consolidated Net Income" of any Person means for any period the
-----------------------
consolidated net income (or loss) of such Person and its Restricted Subsidiaries
for such period determined on a consolidated basis in accordance with GAAP;
provided, however, that there shall be excluded therefrom (a) the net income (or
loss) of any Person acquired by such Person or a Restricted Subsidiary of such
Person in a pooling-of-interests transaction for any period prior to the date of
such transaction, (b) the net income (but not net loss) of any Restricted
Subsidiary of such Person which is subject to restrictions which prevent or
limit the payment of dividends or the making of distributions to such Person to
the extent of such restrictions (regardless of any
-6-
waiver thereof), (c) non-cash gains and losses due solely to fluctuations in
currency values, (d) the net income of any Person that is not a Restricted
Subsidiary of such Person, except to the extent of the amount of dividends or
other distributions representing such Person's proportionate share of such other
Person's net income for such period actually paid in cash to such Person by such
other Person during such period, (e) gains but not losses on Asset Dispositions
by such Person or its Restricted Subsidiaries, (f) all gains and losses
classified as extraordinary, unusual or nonrecurring in accordance with GAAP and
(g) in the case of a successor to the referent Person by consolidation or merger
or as a transferee of the referent Person's assets, any earnings (or losses) of
the successor corporation prior to such consolidation, merger or transfer of
assets.
"Continuing Director" means a director who either was a member of the
-------------------
Board of Directors of the Company on the Issue Date or who became a director of
the Company subsequent to the Issue Date and whose election, or nomination for
election by the Company's stockholders, was duly approved by a majority of the
Continuing Directors then on the Board of Directors of the Company, either by a
specific vote or by approval of the proxy statement issued by the Company on
behalf of the entire Board of Directors of the Company in which such individual
is named as nominee for director.
"Corporate Trust Office of the Trustee" shall be at the address of the
-------------------------------------
Trustee specified in Section 13.02 or such other address as the Trustee may give
notice to the Company.
"Credit Agreement" means, collectively, (i) that certain Loan and
----------------
Security Agreement, to be dated as of February 4, 1997, between the Company and
Bank of America Illinois, (ii) that certain Reimbursement Agreement, dated as of
April 1, 1995, between the Company and Bank of America Illinois and (iii) any
deferrals, renewals, extensions, replacements, refinancings or refundings of any
of the foregoing, or amendments, modifications or supplements to (including,
without limitation, any amendment increasing the amount borrowed or
reimbursement obligation thereunder) whether by or with the same or any other
lender, creditor, or group of creditors and including related notes, guarantee
agreements and other instruments and agreements executed in connection
therewith.
"Default" means any event that is, or after notice or lapse of time or
-------
both would become, an Event of Default.
-7-
"Designated Senior Debt" means (i) so long as the Credit Agreement is
----------------------
in effect, the Senior Debt incurred thereunder and (ii) thereafter, any other
Senior Debt which has at the time of initial issuance an aggregate outstanding
principal amount in excess of $25,000,000 which has been so designated as
Designated Senior Debt by the Board of Directors of the Company at the time of
initial issuance in a resolution delivered to the Trustee.
"Disqualified Stock" of any Person means any Capital Stock of such
------------------
Person which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the final maturity of the Securities.
"DTC" means the Depository Trust Company or its successors.
---
"Euroclear" means Xxxxxx Guaranty Trust Company of New York (Brussels
---------
Office) as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations promulgated by the Commission thereunder.
"Exchange Registration Statement" shall have the meaning set forth in
-------------------------------
the Registration Rights Agreement.
"Expiration Date" has the meaning set forth in the definition of
---------------
"Offer to Purchase" below.
"GAAP" means generally accepted accounting principles, consistently
----
applied, as in effect on the Issue Date in the United States of America, as set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession in the United States. All ratios and computations based on
GAAP contained in this Indenture shall be computed in conformity with GAAP
applied on a consistent basis, except that calculations made for purposes of
determining compliance with the terms of the covenants and with other provisions
of this Indenture shall be made without giving effect to (i) the deduction or
amortization of any
-8-
premiums, fees, and expenses incurred in connection with any financings or any
other permitted incurrence of Indebtedness and (ii) depreciation, amortization
or other expenses recorded as a result of the application of purchase accounting
in accordance with Accounting Principles Board Opinion Nos. 16 and 17.
"Global Security" means the global security, without coupons,
---------------
representing all or a portion of the Securities deposited with DTC substantially
in the form of Exhibit A attached hereto.
"guarantee" by any Person means any obligation, contingent or
---------
otherwise, of such Person guaranteeing any Indebtedness of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and including,
---------------
without limitation, any obligation of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (ii) to purchase property, securities or
services for the purpose of assuring the holder of such Indebtedness of the
payment of such Indebtedness, or (iii) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness (and
"guaranteed," "guaranteeing" and "guarantor" shall have meanings correlative to
---------- ------------ ---------
the foregoing); provided, however, that the guarantee by any Person shall not
include endorsements by such Person for collection or deposit, in either case,
in the ordinary course of business.
"Guarantee" means the guarantee of the Securities by each Guarantor
---------
under this Indenture.
"Guarantor" means each Restricted Subsidiary, if any, of the Company
---------
formed or acquired after the Issue Date, which pursuant to the terms of this
Indenture executes a supplement to this Indenture as a Guarantor.
"Holder" or "Securityholder" means the Person in whose name a Security
------ --------------
is registered on the books of the Registrar or any co-Registrar.
"Incur" means, with respect to any Indebtedness or other obligation of
-----
any Person, to create, issue, incur (including by conversion, exchange or
otherwise), assume, guarantee or otherwise become liable in respect of such
Indebtedness or other obligation or the recording, as required
-9-
pursuant to GAAP or otherwise, of any such Indebtedness or other obligation on
the balance sheet of such Person (and "Incurrence," "Incurred" and "Incurring"
---------- -------- ---------
shall have meanings correlative to the foregoing). Indebtedness of any Person or
any of its Restricted Subsidiaries existing at the time such Person becomes a
Restricted Subsidiary of the Company (or is merged into or consolidates with the
Company or any of its Restricted Subsidiaries), whether or not such Indebtedness
was incurred in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary of the Company (or being merged into or consolidated with
the Company or any of its Restricted Subsidiaries), shall be deemed Incurred at
the time any such Person becomes a Restricted Subsidiary of the Company or
merges into or consolidates with the Company or any of its Restricted
Subsidiaries.
"Indebtedness" means (without duplication), with respect to any
------------
Person, whether recourse is to all or a portion of the assets of such Person and
whether or not contingent, (i) every obligation of such Person for money
borrowed, (ii) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses, (iii) every
reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person, (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith), (v) every Capital Lease
Obligation of such Person, (vi) every net obligation under interest rate swap or
similar agreements or foreign currency hedge, exchange or similar agreements of
such Person and (vii) every obligation of the type referred to in clauses (i)
through (vi) of another Person and all dividends of another Person the payment
of which, in either case, such Person has guaranteed or is responsible or liable
for, directly or indirectly, as obligor, guarantor or otherwise. Indebtedness
shall include the liquidation preference and any mandatory redemption payment
obligations in respect of any Disqualified Stock of the Company, and any
Preferred Stock of a Subsidiary of the Company. Indebtedness shall never be
calculated taking into account any cash and cash equivalents held by such
Person. Indebtedness shall not include obligations arising from agreements of
the Company or a Restricted Subsidiary of the Company to provide for
indemnification, adjustment of purchase price, earn-out, or other similar
obligations, in each
-10-
case, incurred or assumed in connection with the disposition of any business or
assets of a Restricted Subsidiary of the Company.
"Indenture" means this Indenture as amended or supplemented from time
---------
to time.
"Interest Payment Date" means the stated maturity of an installment of
---------------------
interest on the Securities.
"Initial Global Securities" means the Regulation S Global Security and
-------------------------
the 144A Global Security, each of which contains a Securities Act Legend.
"Initial Securities" means the Securities containing a Securities Act
------------------
Legend.
"Institutional Accredited Investors" means an institution that is an
----------------------------------
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
of Regulation D promulgated under the Securities Act.
"Investment" by any Person means any direct or indirect loan, advance,
----------
guarantee or other extension of credit or capital contribution to (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise), or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Indebtedness issued by any other Person.
"Issue Date" means February 4, 1997.
----------
"Lien" means, with respect to any property or assets, any mortgage or
----
deed of trust, pledge, hypothecation, assignment, security interest, lien,
charge, easement (other than any easement not materially impairing usefulness or
marketability), encumbrance, preference, priority or other security agreement
with respect to such property or assets (including, without limitation, any
conditional sale or other title retention agreement having substantially the
same economic effect as any of the foregoing).
"Management Investors" means any of Xxxx Xxxxx, Xxxxxxx Xxxxxxxxx and
--------------------
other full-time members of management of the Company who acquire stock of the
Company's parent, Pen-Tab Holdings, Inc., a Virginia corporation, through
management stock purchase or option plans.
-11-
"Maturity Date" means the date, which is set forth on the face of the
-------------
Securities, on which the Securities will mature.
"Net Available Proceeds" from any Asset Disposition by any Person
----------------------
means cash or readily marketable cash equivalents received (including by way of
sale or discounting of a note, installment receivable or other receivable, but
excluding any other consideration received in the form of assumption by the
acquiror of Indebtedness or other obligations relating to such properties or
assets or received in any other non-cash form) therefrom by such Person,
including any cash received by way of deferred payment or upon the monetization
or other disposition of any non-cash consideration (including notes or other
securities) received in connection with such Asset Disposition, net of (i) all
legal, title and recording tax expenses, commissions and other fees and expenses
incurred and all federal, state, foreign and local taxes required to be accrued
as a liability as a consequence of such Asset Disposition, (ii) all payments
made by such Person or its Restricted Subsidiaries on any Indebtedness which is
secured by such assets in accordance with the terms of any Lien upon or with
respect to such assets or which must by the terms of such Lien, or in order to
obtain a necessary consent to such Asset Disposition or by applicable law, be
repaid out of the proceeds from such Asset Disposition, (iii) all payments made
with respect to liabilities associated with the assets which are the subject of
the Asset Disposition, including, without limitation, trade payables and other
accrued liabilities, (iv) appropriate amounts to be provided by such Person or
any Restricted Subsidiary thereof, as the case may be, as a reserve in
accordance with GAAP against any liabilities associated with such assets and
retained by such Person or any Restricted Subsidiary thereof, as the case may
be, after such Asset Disposition, including, without limitation, liabilities
under any indemnification obligations and severance and other employee
termination costs associated with such Asset Disposition, until such time as
such amounts are no longer reserved or such reserve is no longer necessary (at
which time any remaining amounts will become Net Available Proceeds to be
allocated in accordance with the provisions of clause (iii) of Section 4.05) and
(v) all distributions and other payments made to minority interest holders in
Restricted Subsidiaries of such Person or joint ventures as a result of such
Asset Disposition.
"Offer" has the meaning set forth in the definition of "Offer to
-----
Purchase" below.
"Offer to Purchase" means a written offer (the "Offer") sent by the
----------------- -----
Company by first class mail, postage prepaid, to each
-12-
Holder at his address appearing in the register for the Securities on the date
of the Offer offering to purchase up to the principal amount of Securities
specified in such Offer at the purchase price specified in such Offer (as
determined pursuant to this Indenture). Unless otherwise required by applicable
law, the Offer shall specify an expiration date (the "Expiration Date") of the
---------------
Offer to Purchase which shall be not less than 30 days nor more than 60 days
after the date of such Offer and a settlement date (the "Purchase Date") for
-------------
purchase of Securities within five Business Days after the Expiration Date. The
Company shall notify the Trustee at least 15 Business Days (or such shorter
period as is acceptable to the Trustee) prior to the mailing of the Offer of the
Company's obligation to make an Offer to Purchase, and the Offer shall be mailed
by the Company or, at the Company's request, by the Trustee in the name and at
the expense of the Company. The Offer shall contain all the information required
by applicable law to be included therein. The Offer shall contain all
instructions and materials necessary to enable such Holders to tender Securities
pursuant to the Offer to Purchase. The Offer shall also state:
(1) the Section of this Indenture pursuant to which the Offer to Purchase
is being made;
(2) the Expiration Date and the Purchase Date;
(3) the aggregate principal amount of the outstanding Securities offered
to be purchased by the Company pursuant to the Offer to Purchase
(including, if less than 100%, the manner by which such amount has
been determined pursuant to the Section of this Indenture requiring
the Offer to Purchase) (the "Purchase Amount");
---------------
(4) the purchase price to be paid by the Company for each $1,000 aggregate
principal amount of Securities accepted for payment (as specified
pursuant to this Indenture) (the "Purchase Price");
--------------
(5) that the Holder may tender all or any portion of the Securities
registered in the name of such Holder and that any portion of a
Security tendered must be tendered in an integral multiple of $1,000
principal amount;
(6) the place or places where Securities are to be surrendered for tender
pursuant to the Offer to Purchase;
-13-
(7) that interest on any Security not tendered or tendered but not
purchased by the Company pursuant to the Offer to Purchase will
continue to accrue;
(8) that on the Purchase Date the Purchase Price will become due and
payable upon each Security being accepted for payment pursuant to the
Offer to Purchase and that interest thereon shall cease to accrue on
and after the Purchase Date;
(9) that each Holder electing to tender all or any portion of a Security
pursuant to the Offer to Purchase will be required to surrender such
Security at the place or places specified in the Offer prior to the
close of business on the Expiration Date (such Security being, if the
Company or the Trustee so requires, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his
attorney duly authorized in writing);
(10) that Holders will be entitled to withdraw all or any portion of
Securities tendered if the Company (or its Paying Agent) receives, not
later than the close of business on the fifth Business Day next
preceding the Expiration Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Security the Holder tendered, the certificate
number of the Security the Holder tendered and a statement that such
Holder is withdrawing all or a portion of his tender;
(11) that (a) if Securities in an aggregate principal amount less than or
equal to the Purchase Amount are duly tendered and not withdrawn
pursuant to the Offer to Purchase, the Company shall purchase all such
Securities and (b) if Securities in an aggregate principal amount in
excess of the Purchase Amount are tendered and not withdrawn pursuant
to the Offer to Purchase, the Company shall purchase Securities having
an aggregate principal amount equal to the Purchase Amount on a pro
rata basis (with such adjustments as may be deemed appropriate so that
only Securities in denominations of $1,000 or integral multiples
thereof shall be purchased); and
(12) that in the case of any Holder whose Security is purchased only in
part, the Company shall execute and
-14-
the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder, in an aggregate
principal amount equal to and in exchange for the unpurchased portion
of the Security so tendered.
An Offer to Purchase shall be governed by and effected in accordance
with the provisions above pertaining to any Offer.
"Officer" means the Chairman, the President, any Vice President, the
-------
Chief Financial Officer, the Treasurer, or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers
---------------------
(one of whom shall be the Chief Financial Officer of the Company) or by an
Officer and an Assistant Treasurer or Assistant Secretary of the Company
complying with Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Participant" means, with respect to DTC, Euroclear or Cedel, a Person
-----------
who has an account with DTC, Euroclear or Cedel, respectively (and with respect
to DTC, shall include Euroclear and Cedel).
"Permitted Asset Swap" means any one or more transactions in which the
--------------------
Company or any of its Restricted Subsidiaries exchanges assets for consideration
consisting of cash and/or assets used or useful in the business of the Company
as conducted on the Issue Date or reasonable extensions, developments or
expansions thereof or ancillary thereto or other assets in an amount less than
15% of the fair market value of such transaction or transactions.
"Permitted Holder" means any of (i) the Principals and their Related
----------------
Persons and Affiliates and (ii) the Management Investors and their Related
Persons and Affiliates.
"Permitted Investments" means (i) Investments in marketable direct
---------------------
obligations issued or guaranteed by the United States of America, or any
governmental entity or agency or political subdivision thereof (provided, that
the full faith and credit of the United States of America is pledged in support
thereof), maturing within one year of the date of purchase; (ii)
-15-
Investments in commercial paper issued by corporations or financial institutions
maturing within 180 days from the date of the original issue thereof, and rated
"P-1" or better by Xxxxx'x Investors Service or "A-1" or better by Standard &
Poor's Corporation or an equivalent rating or better by any other nationally
recognized securities rating agency; (iii) Investments in certificates of
deposit issued or acceptances accepted by or guaranteed by any bank or trust
company organized under the laws of the United States of America or any state
thereof or the District of Columbia, in each case having capital, surplus and
undivided profits totalling more than $500,000,000, maturing within one year of
the date of purchase; (iv) Investments representing Capital Stock or obligations
issued to the Company or any of its Restricted Subsidiaries in the course of the
good faith settlement of claims against any other Person or by reason of a
composition or readjustment of debt or a reorganization of any debtor of the
Company or any of its Restricted Subsidiaries; (v) deposits, including interest-
bearing deposits, maintained in the ordinary course of business in banks; (vi)
any acquisition of the Capital Stock of any Person; provided, however, that
after giving effect to any such acquisition such Person shall become a
Restricted Subsidiary of the Company; (vii) trade receivables and prepaid
expenses, in each case arising in the ordinary course of business; provided,
however, that such receivables and prepaid expenses would be recorded as assets
of such Person in accordance with GAAP; (viii) endorsements for collection or
deposit in the ordinary course of business by such Person of bank drafts and
similar negotiable instruments of such other Person received as payment for
ordinary course of business trade receivables; (ix) any interest swap or hedging
obligation with an unaffiliated Person otherwise permitted by this Indenture;
(x) Investments received as consideration for an Asset Disposition in compliance
with Section 4.05; (xi) Investments in Restricted Subsidiaries or by virtue of
which a Person becomes a Restricted Subsidiary; (xii) loans and advances to
employees made in the ordinary course of business; and (xiv) Investments the
sole consideration for which consists of Capital Stock of the Company.
"Permitted Transferee" means, with respect to any Management Investor
--------------------
(i) any spouse or lineal descendant (including by adoption and stepchildren) of
such Management Investor and (ii) any trust, corporation or partnership, the
beneficiaries, stockholders or partners of which consist entirely of one or more
Management Investors or individuals described in clause (i) above.
"Person" means any individual, corporation, limited or general
------
partnership, joint venture, association, joint stock
-16-
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Preferred Stock," as applied to the Capital Stock of any Person,
---------------
means Capital Stock of such Person of any class or classes (however designated)
that ranks prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"principal" of a debt security means the principal of the security
---------
plus, when appropriate, the premium, if any, on the security.
"Principals" means Citicorp Venture Capital, Ltd.
----------
"Private Exchange Securities" shall have the meaning set forth in the
---------------------------
Registration Rights Agreement.
"Purchase Amount" has the meaning set forth in the definition of
---------------
"Offer to Purchase" above.
"Purchase Date" has the meaning set forth in the definition of "Offer
-------------
to Purchase" above.
"Purchase Price" has the meaning set forth in the definition of "Offer
--------------
to Purchase" above.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
---
"redemption date," when used with respect to any Security to be
---------------
redeemed, means the date fixed for such redemption pursuant to this Indenture.
"redemption price," when used with respect to any Security to be
----------------
redeemed, means the price fixed for such redemption pursuant to this Indenture
as set forth in the form of Security annexed as Exhibit A.
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement dated the date hereof among the Company, X.X. Xxxxxx Securities Inc.
and Bear, Xxxxxxx & Co. Inc.
"Regulation S" means Regulation S promulgated under the Securities Act
------------
(including any successor regulation thereto) as it may be amended from time to
time.
-17-
"Related Person" of any Person means any other Person directly or
--------------
indirectly owning (a) 5% or more of the outstanding Common Stock of such Person
(or, in the case of a Person that is not a corporation, 5% or more of the equity
interest in such Person) or (b) 5% or more of the combined voting power of the
Voting Stock of such Person.
"Restricted Physical Security" means a Physical Security containing a
----------------------------
Securities Act Legend.
"Rule 144" shall have the meaning set forth in the Registration Rights
--------
Agreement.
"Rule 144A" shall have the meaning set forth in the Registration
---------
Rights Agreement.
"Securities" means the 10 7/8% Senior Subordinated Notes due 2007
----------
issued pursuant to the terms of this Indenture, as amended or supplemented from
time to time.
"Securities Act" means the Securities Act of 1933, as amended, and the
--------------
rules and regulations promulgated by the Commission thereunder.
"Securityholder" has the meaning set forth in the definition of
--------------
"Holder" above.
"Senior Debt" means, with respect to any Person at any date, (i) in
-----------
the case of the Company or the Guarantor, if any, all Indebtedness under the
Credit Agreement, including principal, premium, if any, and interest on such
Indebtedness and all other amounts due on or in connection with such
Indebtedness including all charges, fees and expenses, (ii) all other
Indebtedness of such Person for borrowed money, including principal, premium, if
any, and interest on such Indebtedness, unless the instrument under which such
Indebtedness for borrowed money is created, incurred, assumed or guaranteed
expressly provides that such Indebtedness for borrowed money is not senior or
superior in right of payment to the Securities, and all renewals, extensions,
modifications, amendments or refinancing thereof and (iii) all interest on any
Indebtedness referred to in clauses (i) and (ii) accruing during the pendency of
any bankruptcy or insolvency proceeding, whether or not allowed thereunder.
Notwithstanding the foregoing, Senior Debt shall not include (a) Indebtedness
which is pursuant to its terms or any agreement relating thereto or by operation
of law subordinated or junior in right of payment or otherwise to any other
Indebtedness of such Person; provided, however, that no Indebtedness shall be
deemed to be subordinate
B-3
-18-
or junior in right of payment or otherwise to any other Indebtedness of a
Person solely by reason of such other Indebtedness being secured and such
Indebtedness not being secured, (b) the Securities, (c) any Indebtedness of such
Person to any of its Subsidiaries, and (d) any Indebtedness which, when incurred
and without respect to any election under Section 1111(b) of the Bankruptcy
Code, is without recourse to the Company.
"Shelf Registration Statement" shall have the meaning set forth in the
----------------------------
Registration Rights Agreement.
"Stated Maturity," when used with respect to any Security or any
---------------
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Subordinated Indebtedness" means any Indebtedness (whether
-------------------------
outstanding on the date hereof or hereafter incurred) which is by its terms
expressly subordinate or junior in right of payment to the Securities.
"Subsidiary" of any Person means (i) a corporation more than 50% of
----------
the outstanding Voting Stock of which is owned, directly or indirectly, by such
Person or by one or more other Subsidiaries of such Person or by such Person and
one or more other Subsidiaries thereof or (ii) any other Person (other than a
corporation) in which such Person, or one or more other Subsidiaries of such
Person or such Person and one or more other Subsidiaries thereof, directly or
indirectly, has at least a majority ownership and voting power relating to the
policies, management and affairs thereof.
"Tangible Assets" means the total amount of assets of the Company and
---------------
the Restricted Subsidiaries after deducting therefrom all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangible assets, all as set forth on the most recent balance sheet of the
Company and its Subsidiaries and computed in accordance with GAAP.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
---
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in
Section 10.03.
-19-
"Trustee" means the party named as such in this Indenture until a
-------
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Trust Officer" means any officer within the corporate trust
-------------
department (or any successor group of the Trustee) including any vice president,
assistant vice president, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such trust matter is referred because of his knowledge of and familiarity
with the particular subject.
"Unrestricted Global Securities" means one or more Global Securities
------------------------------
that do not and are not required to bear the Securities Act Legend.
"Unrestricted Physical Securities" means one or more Physical
--------------------------------
Securities that do not and are not required to bear the Securities Act Legend.
"Unrestricted Securities" means the Securities that do not and are not
-----------------------
required to bear the Securities Act Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
-----------------------
formed or acquired after the Issue Date that at the time of determination is
designated an Unrestricted Subsidiary by the Board of Directors in the manner
provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. Any such
designation by the Board of Directors will be evidenced to the Trustee by
promptly filing with the Trustee a copy of the board resolution giving effect to
such designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions. The Board of Directors of the Company
may not designate any Subsidiary of the Company to be an Unrestricted Subsidiary
if, after such designation, (a) the Company or any other Restricted Subsidiary
(i) provides credit support for, or a guarantee of, any Indebtedness of such
Subsidiary (including any undertaking, agreement or instrument evidencing such
Indebtedness) or (ii) is directly or indirectly liable for any Indebtedness of
such Subsidiary, (b) a default with respect to any Indebtedness of such
Subsidiary (including any right which the holders thereof may have to take
enforcement action against such Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness of the Company or any
Restricted Subsidiary to declare a default on such other
-20-
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity or (c) such Subsidiary owns any Capital Stock of,
or owns or holds any Lien on any property of, any Restricted Subsidiary which is
not a Subsidiary of the Subsidiary to be so designated.
"Voting Stock" of any Person means the Capital Stock of such Person
------------
which ordinarily has voting power for the election of directors (or persons
performing similar functions) of such Person, whether at all times or only so
long as no senior class of securities has such voting power by reason of any
contingency.
"Wholly Owned Subsidiary" of any Person means a Restricted Subsidiary
-----------------------
of such Person all of the outstanding Capital Stock or other ownership interests
of which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more Wholly Owned Subsidiaries of such Person.
SECTION 1.012. Other Definitions.
-----------------
Term Defined in Section
---- ------------------
"Bankruptcy Law" 6.01
"Change of Control" 4.14
"Custodian" 6.01
"Event of Default" 6.01
"Funding Guarantor" 11.05
"Guarantor Blockage Period" 12.02(a)
"Guarantor Payment Blockage Notice" 12.02(a)
"144A Global Security" 2.01(a)
"Paying Agent" 2.03
"Payment Blockage Notice" 8.02(a)
"Payment Blockage Period" 8.02(a)
"Physical Security" 2.01(b)
"Registrar" 2.03
"Regulation S Global Security" 2.01(a)
"Required Filing Date" 4.12
"Securities Act Legend" 2.06(f)
"United States Government Obligation" 9.01
SECTION 1.013. Incorporation by Reference of Trust Indenture Act.
--------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a
-21-
part of this Indenture. The following TIA terms used in this Indenture have the
following meanings:
"Commission" means the Securities and Exchange Commission.
----------
"indenture securities" means the Securities.
--------------------
"indenture security holder" means a Holder or Securityholder.
-------------------------
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee.
----------------- ---------------------
"obligor" on the indenture securities means the Company or any other
-------
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
and not otherwise defined herein have the meanings assigned to them therein.
SECTION 1.0 Rules of Construction.
---------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles in effect
from time to time, and any other reference in this Indenture to "generally
accepted accounting principles" refers to GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
-22-
ARTICLE TWO
THE SECURITIES
SECTION 1.021. Form and Dating.
---------------
(a) Global Securities. Securities offered and sold to QIBs in
-----------------
reliance on Rule 144A shall be issued initially substantially in the form of
Exhibit A hereto in the name of Cede & Co. as nominee of DTC, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. Such
Security shall be referred to herein as the "144A Global Security." Securities
offered and sold in reliance on Regulation S shall be issued initially
substantially in the form of Exhi bit A hereto in the name of Cede & Co. as
nominee of DTC, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. Such Security shall be referred to herein as the
"Regulation S Global Security." Unrestricted Global Securities shall be issued
initially in accordance with Sections 2.06(b)(iv), 2.06(c)(ii) and 2.06(e) in
the name of Cede & Co. as nominee of DTC, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of each of the Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee as hereinafter
provided.
Each Global Security shall represent such of the outstanding
Securities as shall be specified therein and each shall provide that it shall
represent the aggregate principal amount of outstanding Securities from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Securities represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and transfers of interests
therein in accordance with the terms of this Indenture. Any endorsement of a
Global Security to reflect the amount of any increase or decrease in the
principal amount of outstanding Securities represented thereby shall be made by
the Trustee in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
Upon the issuance of the Global Security to DTC, DTC shall credit, on
its internal book-entry registration and transfer system, its Participant's
accounts with the respective interests owned by such Participants. Interests in
the Global Securities shall be limited to Participants, including Euroclear and
Cedel, and indirect Participants.
-23-
The Participants shall not have any rights either under this Indenture
or under any Global Security with respect to such Global Security held on their
behalf by DTC, and DTC may be treated by the Company, the Trustee and any agent
of the Company or the Trustee as the absolute owner of such Global Security for
the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, interest and Additional Interest,
if any, on the Global Securities and for all other purposes. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by DTC or impair, as
between DTC and its Participants, the operation of customary practices of DTC
governing the exercise of the rights of an owner of a beneficial interest in any
Global Security.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel shall be applicable
to interests in the Regulation S Global Security that are held by the
Participants through Euroclear or Cedel.
(b) Physical Securities. Securities offered and sold to Institutional
-------------------
Accredited Investors who are not also QIBs shall be issued initially
substantially in the form of Exhibit A hereto, in certificated form and issued
in the names of the purchasers thereof (or their nominees), duly executed by the
Company and authenticated by the Trustee as hereinafter provided. Such
Securities, together with any Securities subsequently issued, whether pursuant
to the terms of Section 2.06 hereof or otherwise, that are not Global
Securities, shall be referred to herein as the "Physical Securities."
(c) Securities. The provisions of the form of Securities contained in
----------
Exhibit A hereto are incorporated herein by reference. The Securities and the
Trustee's Certificates of Authentication shall be substantially in the form of
Exhibit A hereto. The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage. The Company shall approve the
form of the Securities and any notation, legend or endorsement (including
notations relating to the Guarantee) on them. If required, the Securities may
bear the appropriate legend regarding original issue discount for federal income
tax purposes. Each Security shall be dated the date of its authentication. The
terms and provisions contained in the
-24-
Securities shall constitute, and are hereby expressly made, a part of this
Indenture.
SECTION 1.022. Execution and Authentication.
----------------------------
Two Officers of the Company shall sign the Securities for the Company
by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized officer of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate (i) Initial Securities for original
issue in the aggregate principal amount of up to $200,000,000 in one or more
series, (ii) Private Exchange Securities form time to time only in exchange for
a like principal amount of Initial Securities and (iii) Unrestricted Securities
from time to time only (x) in exchange for a like principal amount of Initial
Securities or (y) in an aggregate principal amount of not more than the excess
of $200,000,000 over the sum of the aggregate principal amount of (A) Initial
Securities then outstanding, (B) Private Exchange Securities then outstanding
and (C) Unrestricted Securities issued in accordance with clause (iii)(x), in
each case upon a written order signed by an Officer of the Company. The order
shall be based upon a Board Resolution of the Company to similar effect filed
with the Trustee and shall specify the amount of Securities to be authenticated
and the date on which the original issue of Securities is to be authenticated.
The order shall also provide instructions concerning registration, amounts for
each Holder and delivery. The aggregate principal amount of Securities
outstanding at any time may not exceed $200,000,000 except as provided in
Section 2.07. The Securities shall be issued only in registered form, without
coupons and only in denominations of $1,000 and any integral multiple thereof.
SECTION 1.023. Registrar and Paying Agent.
--------------------------
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
---------
office or agency where Securities may be presented for payment ("Paying Agent").
------------
The Company may
-25-
have one or more co-Registrars and one or more additional paying agents. The
term "Paying Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent and shall, if required,
incorporate the provisions of the TIA. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with the provisions of Section 7.07.
The Company initially appoints the Trustee as Registrar and Paying
Agent. The Company shall give written notice to the Trustee in the event that
the Company decides to act as Registrar. None of the Company, its Subsidiaries
or any of their Affiliates may act as Paying Agent.
SECTION 1.024. Paying Agent To Hold Money in Trust.
-----------------------------------
The Company shall require each Paying Agent to agree in writing to
hold in trust for the benefit of Securityholders or the Trustee all money held
by the Paying Agent for the payment of principal of or interest on the
Securities (whether such money has been paid to it by the Company or any other
obligor on the Securities), and the Company and the Paying Agent shall each
notify the Trustee of any default by the Company (or any other obligor on the
Securities) in making any such payment. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee and account for any
funds disbursed and the Trustee may at any time during the continuance of any
payment default, upon written request to a Paying Agent, require such Paying
Agent to pay all money held by it to the Trustee and to account for any funds
disbursed. Upon making such payment the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 1.025. Securityholder Lists.
--------------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee at least five Business Days before each Interest Payment Date and
at such other times as the Trustee may request in writing a list in
-26-
such form and as of such date as the Trustee may reasonably require of the names
and addresses of Securityholders.
SECTION 1.026. Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Global Securities. Transfer of the Global
------------------------------------------
Securities shall be by delivery. Global Securities will be exchanged by the
Company for Physical Securities only (i) if DTC notifies the Company that it is
unwilling or unable to continue to act as depositary with respect to the Global
Securities or ceases to be a clearing agency registered under the Exchange Act
and, in either case, a successor depositary registered as a clearing agency
under the Exchange Act is not appointed by the Company within 120 days, (ii) at
any time if the Company in its sole discretion determines that the Global
Securities (in whole but not in part) should be exchanged for Physical
Securities or (iii) if the owner of an interest in the Global Securities
requests such Physical Securities, following an Event of Default under the
Indenture, in a writing delivered through DTC to the Trustee.
Upon the occurrence of any of the events specified in the previous
paragraph, Physical Securities shall be issued in such names as DTC shall
instruct the Trustee and the Trustee shall cause the aggregate principal amount
of the applicable Global Security to be reduced accordingly and direct DTC to
make a corresponding reduction in its book-entry system. The Company shall
execute and the Trustee shall authenticate and deliver to the Person designated
in the instructions a Physical Security in the appropriate principal amount.
The Trustee shall deliver such Physical Securities to the Persons in whose names
such Securities are so registered. Physical Securities issued in exchange for
an Initial Global Security pursuant to this Section 2.06(a) shall bear the
Securities Act Legend and shall be subject to all restrictions on transfer
contained therein. Global Securities may also be exchanged or replaced, in
whole or in part, as provided in Sections 2.07 and 2.10. Every Security
authenticated and delivered in exchange for, or in lieu of, a Global Security or
any portion thereof, pursuant to Section 2.07 or 2.10, shall be authenticated
and delivered in the form of, and shall be, a Global Security. A Global
Security may not be exchanged for another Security other than as provided in
this Section 2.06(a).
(b) Transfer and Exchange of Interests in Global Securities. The
-------------------------------------------------------
transfer and exchange of interests in Global Securities shall be effected
through DTC, in accordance with this Indenture and the procedures of DTC
therefor. Interests in Initial Global Securities shall be subject to
restrictions on
-27-
transfer comparable to those set forth herein to the extent required by the
Securities Act. The Trustee shall have no obligation to ascertain DTC's
compliance with any such restrictions on transfer. Transfers of interests in
Global Securities shall also require compliance with subparagraph (i) below, as
well as one or more of the other following subpara graphs as applicable:
(i) All Transfers and Exchanges of Interests in Global Securities.
-------------------------------------------------------------
In connection with all transfers and exchanges of interests in Global
Securities (other than transfers of Interests in a Global Security to
Persons who take delivery thereof in the form of an interest in the same
Global Security), the transferor of such interest must deliver to the
Registrar (1) instructions given in accordance with the Applicable
Procedures from a Participant or an indirect Participant directing DTC to
credit or cause to be credited an interest in the specified Global Security
in an amount equal to the interest to be transferred or exchanged, (2) a
written order given in accordance with the Applicable Procedures containing
information regarding the Participant account to be credited with such
increase and (3) instructions given by the Holder of the Global Security to
effect the transfer referred to in (1) and (2) above.
(ii) Transfer of Interests in the Same Initial Global Security.
---------------------------------------------------------
Interests in any Initial Global Security may be transferred to Persons who
take delivery thereof in the form of an interest in the same Initial Global
Security in accordance with the transfer restrictions set forth in Section
2.06(f) hereof.
(iii) Transfer of Interests to Another Initial Global Security.
--------------------------------------------------------
Interests in any Initial Global Security may be transferred to Persons who
take delivery thereof in the form of an interest in another Initial Global
Security if the Registrar receives the following:
(A) if the transferee will take delivery in the form of an
interest in the 144A Global Security, then the transferor must deliver
a certificate in the form of Exhibit B hereto, including the
certifications in item 1 thereof; or
(B) if the transferee will take delivery in the form of an
interest in the Regulation S Global Security, then the transferor must
deliver a
-28-
certificate in the form of Exhibit B hereto, including the
certifications in item 2 thereof.
(iv) Transfer and Exchange of Interests in Initial Global
----------------------------------------------------
Security for Interests in an Unrestricted Global Security. Interests in any
---------------------------------------------------------
Initial Global Security may be exchanged by the holder thereof for an
interest in the Unrestricted Global Security or transferred to a Person who
takes delivery thereof in the form of an interest in the Unrestricted
Global Security if:
(A) such exchange or transfer is effected pursuant to the
Exchange Registration Statement in accordance with the Registration
Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(C) the Registrar receives the following:
(1) if the Holder of such an interest in a Initial Global
Security proposes to exchange it for an interest in the
Unrestricted Global Security, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item 1(a) thereof;
(2) if the Holder of such an interest in a Initial Global
Security proposes to transfer it to a Person who shall take
delivery thereof in the form of an interest in an Unrestricted
Global Security, a certificate in the form of Exhibit B hereto,
including the certification in item 4 thereof; and
(3) in each such case set forth in this paragraph (C), an
Opinion of Counsel in form reasonably acceptable to the Company,
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 Section 2.06(f) hereof are not required
in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a time
when an Unrestricted Global Security has not yet been issued, the Company
shall issue and, upon receipt
-29-
of an authentication order in accordance with Section 2.02, the Trustee
shall authenticate one or more Unrestricted Global Securities in an
aggregate principal amount equal to the principal amount of interests in
the Initial Global Security transferred pursuant to paragraph (B) above.
(v) Notation by the Trustee of Transfer of Interests Among Global
-------------------------------------------------------------
Securities. Upon satisfaction of the requirements for transfer of
----------
interests in Global Securities pursuant to clauses (iii) or (iv) above, the
Trustee, as Registrar, shall reduce or cause to be reduced the aggregate
principal amount of the relevant Global Security from which the interests
are being transferred, and increase or cause to be increased the aggregate
principal amount of the Global Security to which the interests are being
transferred, in each case, by the principal amount so transferred and shall
direct DTC to make corresponding adjustments in its book-entry system. No
transfer of interests of a Global Security shall be effected until, and any
transferee pursuant thereto shall succeed to the rights of a holder of such
interests only when, the Registrar has made appropriate adjustments to the
applicable Global Security in accordance with this paragraph.
(c) Transfer or Exchange of Physical Securities for Interests in a
--------------------------------------------------------------
Global Security.
---------------
(i) If any holder of Physical Securities required to contain the
Securities Act Legend proposes to exchange such Securities for an interest
in a Global Security or to transfer such Physical Securities to a Person
who takes delivery thereof in the form of an interest in a Global Security,
then, upon receipt by the Registrar of the following documentation (all of
which may be submitted by facsimile):
(A) if the holder of such Physical Registered Securities proposes
to exchange such Securities for an interest in an Initial Global
Security, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item 2 thereof;
(B) if such Physical Securities are being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item 1 thereof; or
-30-
(C) if such Physical Securities are being transferred to a Non-
U.S. Person (as defined in Regulation S) in an offshore transaction in
accordance with Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item 2 thereof.
the Trustee shall cancel the Physical Securities, increase or cause to be
increased the aggregate principal amount of, in the case of clause (B)
above, the 144A Global Security, in the case of clause (C) above, the
Regulation S Global Security, and direct DTC to make a corresponding
increase in its book-entry system.
(ii) A holder of Physical Securities required to contain the
Securities Act Legend may exchange such Securities for an interest in the
Unrestricted Global Security or transfer such Restricted Physical
Securities to a Person who takes delivery thereof in the form of an
interest in the Unrestricted Global Security only:
(A) if such exchange or transfer is effected pursuant to the
Exchange Registration Statement in accordance with the Registration
Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) upon receipt by the Registrar of the following documentation
(all of which may be submitted by facsimile):
(1) if the Holder of such Physical Securities proposes to
exchange such Securities for an interest in the Unrestricted
Global Security, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item 1(b)
thereof;
(2) if the Holder of such Registered Securities proposes to
transfer such Securities to a Person who shall take delivery
thereof in the form of an interest in the Unrestricted Global
Security, a certificate in the form of Exhibit B hereto,
including the certifications in item 4 thereof; and
-31-
(3) in each such case set forth in this paragraph (C), an
Opinion of Counsel in form reasonably acceptable to the Company,
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 Section 2.06(f) hereof are not required
in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above
at a time when an Unrestricted Global Security has not yet been
issued, the Company shall issue and, upon receipt of an authentication
order in accordance with Section 2.02, the Trustee shall authenticate
(i) one or more Unrestricted Global Securities in an aggregate
principal amount equal to the principal amount of Physical Securities
transferred pursuant to paragraph (B) above.
(d) Transfer and Exchange of Physical Securities.
--------------------------------------------
(i) Transfer of a Physical Security to Another Physical Security.
------------------------------------------------------------
Following the occurrence of one or more of the events specified in Section
2.06(a), a Physical Security may be transferred to Persons who take
delivery thereof in the form of another Physical Security if the Registrar
receives the following:
(A) if the transfer is being effected pursuant to and in
accordance with Rule 144A, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item 3(a) thereof; or
(B) if the transfer is being effected pursuant to and in
accordance with Regulation S, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item 3(b) thereof.
(ii) Transfer and Exchange of Restricted Physical Security for
---------------------------------------------------------
Physical Security Which Does Not Bear the Securities Act Legend. Following
---------------------------------------------------------------
the occurrence of one or more of the events specified in Section 2.06(a), a
Restricted Physical Security may be exchanged by the Holder thereof for a
Physical Security or transferred to a Person who takes delivery thereof in
the form of a Physical Security which does not bear the Securities Act
Legend if:
-32-
(A) such exchange or transfer is effected pursuant to the
Exchange Registration Statement in accordance with the Registration
Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(C) the Registrar receives a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item 1(c)
thereof and an Opinion of Counsel in form reasonably acceptable to the
Company, 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 Section 2.06(f) hereof are not required in
order to maintain compliance with the Securities Act.
(iii) Exchange of Physical Securities. When Physical Securities
-------------------------------
are presented by a Holder to the Registrar with a request to register the
exchange of such Physical Securities for an equal principal amount of
Physical Securities of other authorized denominations, the Registrar shall
make the exchange as requested only if the Physical Securities are endorsed
or accompanied by a written instrument of transfer in form satisfactory to
the Registrar duly executed by such Holder or by his attorney duly
authorized in writing and shall be issued only in the name of such Holder
or its nominee. The Physical Securities issued in exchange for Physical
Securities shall bear the Securities Act Legend and shall be subject to all
restrictions on transfer contained herein in each case to the same extent
as the Physical Securities so exchanged.
(iv) Return of Physical Securities. In the event of a transfer
-----------------------------
pursuant to clauses (i) or (ii) above and the Holder thereof as delivered
certificates representing an aggregate principal amount of Securities in
excess of that to be transferred, the Company shall execute and the Trustee
shall authenticate and deliver to the Holder of such Security without
service charge, a new Physical Security or Securities of any authorized
denomination requested by the Holder, in an aggregate principal amount
equal to the portion of the Security not so transferred.
(e) Exchange Offer. Upon the occurrence of the Exchange Offer (as
--------------
defined in the Registration Rights Agreement) in accordance with the
Registration Rights Agreement, the Company
-33-
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02, the Trustee shall authenticate one or more Unrestricted Global
Securities in an aggregate principal amount equal to the principal amount of the
interests in the Initial Global Securities and Restricted Physical Securities
tendered for acceptance by persons participating therein. Concurrently with the
issuance of such Securities, the Trustee shall cause the aggregate principal
amount of the applicable Initial Global Securities to be reduced accordingly and
direct DTC to make a corresponding reduction in its book-entry system. The
Trustee shall cancel any Restricted Physical Certificates in accordance with
Section 2.11 hereof.
In the case that one or more of the events specified in Section
2.06(a) have occurred, upon the occurrence of such Exchange Offer, the Company
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02, the Trustee shall authenticate Unrestricted Physical Securities
in an aggregate principal amount equal to the principal amount of the Restricted
Physical Securities tendered for acceptance by persons participating therein.
(f) Legends.
-------
Each Initial Global Security and each Restricted Physical Security
shall bear the legend (the "Securities Act Legend") in substantially the
---------------------
following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX
XXX XXXXXX XXXXXX SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY
EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES
ACT OR (c) OUTSIDE THE UNITED
-34-
STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 904 UNDER THE SECURITIES ACT, (2) TO THE COMPANY OR (3)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS
SET FORTH IN (A) ABOVE."
(g) Global Security Legend. Each Global Security shall bear a legend
----------------------
in substantially the following form:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC") TO A NOMINEE OF DTC, OR BY ANY SUCH NOMINEE OF
DTC, OR BY DTC TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC). ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS
IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.06 OF THE INDENTURE.
(h) Cancellation and/or Adjustment of Global Securities. At such time
---------------------------------------------------
as all interests in the Global Securities have been exchanged for Physical
Securities, all Global Securities 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 interest in a Global Security is exchanged for an
interest in another Global Security
-35-
or for Physical Securities, the principal amount of Securities represented by
such Global Security shall be reduced accordingly and an endorsement shall be
made on such Global Security, by the Trustee to reflect such reduction.
(i) General Provisions Relating to All Transfers and Exchanges.
----------------------------------------------------------
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Securities
and Physical Securities upon a written order signed by an Officer of the
Company or at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any stamp or transfer tax or similar
governmental charge payable in connection therewith (other than any such
stamp or transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 4.05, 4.14 and 10.05
hereof).
(iii) All Global Securities and Physical Securities issued upon
any registration of transfer or exchange of Global Securities or Physical
Securities shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Global Securities or Physical Securities surrendered upon such registration
of transfer or exchange.
(iv) The Company shall not be required (A) to issue, to register
the transfer of or to exchange Securities during a period beginning at the
opening of business 15 days before the day of any selection of Securities
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 Security so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part or (C)
to register the transfer of or to exchange a Security between a record date
and the next succeeding Interest Payment Date.
(v) Prior to due presentment for the registration of a transfer
of any Security, the Trustee, any Agent and the Company may deem and treat
the Person in whose name any Security is registered as the absolute owner
of such Security for the purpose of receiving payment of principal
-36-
of and interest on such Securities and for all other purposes, and none of
the Trustee, any Agent or the Company shall be affected by notice to the
contrary.
SECTION 1.027 Replacement Securities.
----------------------
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Security if the Trustee's requirements are met. An indemnity bond in an amount
sufficient in the judgment of the Company and the Trustee to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer if
a Security is replaced may be required by the Trustee or the Company. The
Company and the Trustee each may charge such Holder for its expenses in
replacing such Security.
Every replacement Security is an additional obligation of the Company.
SECTION 1.028 Outstanding Securities.
----------------------
Securities outstanding at any time are all Securities that have been
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation and those described in this Section as not outstanding.
A Security does not cease to be outstanding because the Company or one of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds on a redemption date or Maturity Date money
sufficient to pay the principal of, and interest on Securities payable on that
date, then on and after that date such Securities cease to be outstanding and
interest on them ceases to accrue.
SECTION 1.029 Treasury Securities.
-------------------
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, any Subsidiary or any of their respective Affiliates shall be
disregarded, except that for the purposes of determining whether
-37-
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Securities that the Trustee actually knows are so owned shall be
so disregarded.
The Trustee may require an Officers' Certificate listing securities
owned by the Company, any Subsidiary or any of their respective Affiliates.
SECTION 2.10. Temporary Securities.
--------------------
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities in exchange for temporary Securities. Until
such exchange, temporary Securities shall be entitled to the same rights,
benefits and privileges as definitive Securities.
SECTION 2.11. Cancellation.
------------
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee and no one else shall cancel all Securities surrendered for transfer,
exchange, payment or cancellation. The Company may not issue new Securities to
replace, or reissue or resell, Securities which the Company has redeemed, paid,
purchased on the open market or otherwise, or otherwise acquired or have been
delivered to the Trustee for cancellation. The Trustee (subject to the record-
retention requirements of the Exchange Act) may, but shall not be required to
destroy cancelled Securities.
SECTION 2.12. Defaulted Interest.
------------------
If the Company defaults in a payment of interest on the Securities, it
shall pay the defaulted interest, plus any interest payable on the defaulted
interest pursuant to Section 4.01 hereof, to the persons who are Securityholders
on a subsequent special record date, and such term, as used in this Section 2.12
with respect to the payment of any defaulted interest, shall mean the fifteenth
day next preceding the date fixed by the Company for the payment of defaulted
interest, whether or not such day is a Business Day. At least 15 days before
such special record date, the Company shall mail to each
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Securityholder and to the Trustee a notice that states such special record date,
the payment date and the amount of defaulted interest to be paid.
SECTION 2.13. CUSIP or CINS Number.
--------------------
The Company in issuing the Securities may use a "CUSIP" or "CINS"
number, and if so, such CUSIP or CINS number shall be included in notices of
redemption or exchange as a convenience to Holders; provided that any such
--------
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP or CINS number printed in the notice or on the Securities,
and that reliance may be placed only on the other identification numbers printed
on the Securities. The Company will promptly notify the Trustee of any change
in the CUSIP or CINS number.
SECTION 2.14. Payments of Interest.
--------------------
(a) The Holder of a Physical Security at the close of business on the
regular record date with respect to any Interest Payment Date shall be entitled
to receive the interest and Additional Interest, if any, payable on such
Interest Payment Date notwithstanding any transfer or exchange of such Physical
Security subsequent to the regular record date and prior to such Interest
Payment Date, except if and to the extent the Company shall default in the
payment of the interest or Additional Interest due on such Interest Payment
Date, in which case such defaulted interest and Additional Interest, if any,
shall be paid in accordance with Section 2.12; provided that, in the event of an
exchange of a Physical Security for a beneficial interest in any Global Security
subsequent to a regular record date or any special record date and prior to or
on the related Interest Payment Date or other payment date under Section 2.12,
any payment of the interest and Additional Interest payable on such payment date
with respect to any such Physical Security shall be made to the Person in whose
name such Physical Security was registered on such record date. Payments of
interest on the Global Securities will be made to the Holder of the Global
Security on each Interest Payment Date; provided that, in the event of an
exchange of all or a portion of a Global Security for Physical Security
subsequent to the regular record date or any special record date and prior to or
on the related Interest Payment Date or other payment date under Section 2.12
any payment of interest or Additional Interest payable on such Interest Payment
Date or other payment date with respect to the Physical Security shall be made
to the Holder of the Global Security.
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(b) The Trustee shall pay interest and Additional Interest, if any, to
DTC, with respect to any Global Security held by DTC, on the applicable Interest
Payment Date in accordance with instructions received from DTC at least five
Business Days before the applicable Interest Payment Date.
ARTICLE THREE
REDEMPTION
SECTION 1.031. Notices to Trustee.
------------------
If the Company wants to redeem Securities pursuant to paragraph 5 of
the Securities at the applicable redemption price set forth thereon, it shall
notify the Trustee in writing of the redemption date and the principal amount of
Securities to be redeemed.
The Company shall give the notice provided for in this Section 3.01 at
least 45 days before the redemption date (unless a shorter notice shall be
agreed to by the Trustee in writing) but not more than 60 days before the
redemption date, together with an Officers' Certificate stating that such
redemption will comply with the conditions contained herein.
SECTION 1.032. Selection of Securities To Be Redeemed.
--------------------------------------
If less than all of the Securities are to be redeemed pursuant to
paragraph 5 thereof, the Trustee shall select the Securities to be redeemed pro
---
rata or by lot or in such other manner as the Trustee shall deem appropriate and
----
fair. The Trustee shall make the selection from the Securities then
outstanding, subject to redemption and not previously called for redemption.
The Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Securities that have denominations larger
than $1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.
SECTION 1.033. Notice of Redemption.
--------------------
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail a notice of redemption by first class mail to each Holder
whose Securities are to be redeemed.
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The notice shall identify the Securities to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price;
(3) the CUSIP number;
(4) the name and address of the Paying Agent to which the Securities
are to be surrendered for redemption;
(5) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making the redemption
payment, interest on Securities called for redemption ceases to accrue on
and after the redemption date and the only remaining right of the Holders
is to receive payment of the redemption price upon surrender to the Paying
Agent; and
(7) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
redemption date, upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion thereof will
be issued.
At the Company's request, the Trustee shall give the notice of
redemption on behalf of the Company, in the Company's name and at the Company's
expense.
SECTION 1.034. Effect of Notice of Redemption.
------------------------------
Once a notice of redemption is mailed, Securities called for
redemption become due and payable on the redemption date and at the redemption
price. Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price, plus accrued interest thereon to the redemption date, but
interest installments whose maturity is on or prior to such redemption date
shall be payable to the Holders of record at the close of business on the
relevant record dates referred to in the Securities. The Trustee shall not be
required to (i) issue, authenticate, register the transfer of or exchange any
Security during a period beginning 15 days before the date a notice of
redemption is mailed and ending at the close of business on the
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date the redemption notice is mailed, or (ii) register the transfer or exchange
of any Security so selected for redemption in whole or in part, except the
unredeemed portion of any Security being redeemed in part.
SECTION 1.035. Deposit of Redemption Price.
---------------------------
At least one Business Day before the redemption date, the Company
shall deposit with the Paying Agent money sufficient to pay the redemption price
of and accrued interest on all Securities to be redeemed on that date other than
Securities or portions thereof called for redemption on that date which have
been delivered by the Company to the Trustee for cancellation.
SECTION 1.036. Securities Redeemed in Part.
---------------------------
Upon surrender of a Security that is redeemed in part, the Trustee
shall authenticate for the Holder a new Security equal in principal amount to
the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
SECTION 1.041. Payment of Securities.
---------------------
The Company shall pay the principal of and interest on the Securities
in the manner provided in the Securities. An installment of principal or
interest shall be considered paid on the date due if the Trustee or Paying Agent
holds on that date money designated for and sufficient to pay the installment in
full and is not prohibited from paying such money to the Holders of the
Securities pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the same rate
per annum borne by the Securities. The Company shall pay interest on overdue
---------
installments of interest at the same rate per annum borne by the Securities, to
---------
the extent lawful.
SECTION 1.042. Maintenance of Office or Agency.
-------------------------------
The Company shall maintain in the Borough of Manhattan, The City of
New York, an office or agency where Securities may be surrendered for
registration of transfer or exchange or for presentation for payment and where
notices and demands to or upon the Company in respect of the Securities and this
Indenture may
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be served. The Company 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 the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.02.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York, for such purposes. The Company 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.
SECTION 1.043. Limitation on Transactions with
Affiliates and Related Persons.
-------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into directly or indirectly any transaction with any of
their respective Affiliates or Related Persons (other than the Company or a
Restricted Subsidiary of the Company), including, without limitation, the
purchase, sale, lease or exchange of property, the rendering of any service, or
the making of any guarantee, loan, advance or Investment, either directly or
indirectly, involving aggregate consideration in excess of $1,000,000 unless a
majority of the disinterested directors of the Board of Directors of the Company
determines, in its good faith judgment evidenced by a resolution of such Board
of Directors filed with the Trustee, that the terms of such transaction are at
least as favorable as the terms that could be obtained by the Company or such
Restricted Subsidiary, as the case may be, in a comparable transaction made on
an arms-length basis between unaffiliated parties; provided, however, that if
the aggregate consideration is in excess of $5,000,000 the Company shall also
obtain, prior to the consummation of the transaction, the favorable opinion as
to the fairness of the transaction to the Company or such Restricted Subsidiary,
from a financial point of view from an independent financial advisor. The
provisions of this covenant shall not apply to (i) transactions permitted by
Section 4.06, (ii) reasonable fees and compensation paid to, and indemnity
provided on behalf of, officers, directors and employees of the Company and its
Restricted Subsidiaries as determined in good faith by the Board
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of Directors of the Company and (iii) loans to employees in the ordinary course
of business which are approved in good faith by the Board of Directors of the
Company.
SECTION 1.044. Limitation on Indebtedness.
--------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, Incur any Indebtedness (including
Acquired Indebtedness), except: (i) Indebtedness of the Company or any of its
Restricted Subsidiaries, if immediately after giving effect to the Incurrence of
such Indebtedness and the receipt and application of the net proceeds thereof,
the Consolidated Cash Flow Ratio of the Company for the four full fiscal
quarters for which quarterly or annual financial statements are available next
preceding the Incurrence of such Indebtedness, calculated on a pro forma basis
in accordance with Article 11 of Regulation S-X under the Securities Act or any
successor provision as if such Indebtedness had been Incurred on the first day
of such four full fiscal quarters, would be greater than 2.0 to 1.00; (ii)
Indebtedness of the Company and its Restricted Subsidiaries, Incurred under the
Credit Agreement in an amount not to exceed the greater of (a) $40,000,000 or
(b) an amount equal to the sum (x) 85% of the book value of the accounts
receivable of the Company and its Restricted Subsidiaries, (y) 60% of the book
value (as determined on a first-in first-out basis) of the inventory of the
Company and its Restricted Subsidiaries and (z) $5,000,000, in the case of
clauses (x) and (y) determined in accordance with GAAP; (iii) Indebtedness owed
by the Company to any direct or indirect Wholly Owned Subsidiary of the Company
or Indebtedness owed by a direct or indirect Restricted Subsidiary of the
Company to the Company or a direct or indirect Wholly Owned Subsidiary of the
Company; provided, however, upon either (I) the transfer or other disposition by
such direct or indirect Wholly Owned Subsidiary or the Company of any
Indebtedness so permitted under this clause (iii) to a Person other than the
Company or another direct or indirect Wholly Owned Subsidiary of the Company or
(II) the issuance (other than directors' qualifying shares), sale, transfer or
other disposition of shares of Capital Stock or other ownership interests
(including by consolidation or merger) of such direct or indirect Wholly Owned
Subsidiary to a Person other than the Company or another such Wholly Owned
Subsidiary of the Company, the pro-visions of this clause (iii) shall no longer
be applicable to such Indebtedness and such Indebtedness shall be deemed to have
been Incurred at the time of any such issuance, sale, transfer or other
disposition, as the case may be; (iv) Indebtedness of the Company or any
Restricted Subsidiary under any interest rate agreement to the extent entered
into to hedge
-44-
any other Indebtedness permitted under this Indenture (including the
Securities); (v) Indebtedness Incurred to renew, extend, refinance or refund
(collectively for purposes of this clause (v) to "refund") any Indebtedness
outstanding on the Issue Date, any Indebtedness Incurred under the prior clause
(i) above or the Securities and the Guarantee, if any; provided, however, that
(I) such Indebtedness does not exceed the principal amount (or accrual amount,
if less) of Indebtedness so refunded (plus unused commitments under revolving
credit facilities) plus the amount of any premium required to be paid in
connection with such refunding pursuant to the terms of the Indebtedness
refunded or the amount of any premium reasonably determined by the issuer of
such Indebtedness as necessary to accomplish such refunding by means of a tender
offer, exchange offer, or privately negotiated repurchase, plus the expenses of
such issuer reasonably incurred in connection therewith and (II)(A) in the case
of any refunding of Indebtedness that is pari passu with the Securities, such
refunding Indebtedness is made pari passu with or subordinate in right of
payment to the Securities, and, in the case of any refunding of Indebtedness
that is subordinate in right of payment to the Securities, such refunding
Indebtedness is subordinate in right of payment to the Securities on terms no
less favorable to the Holders of the Securities than those contained in the
Indebtedness being refunded, (B) in either case, the refunding Indebtedness by
its terms, or by the terms of any agreement or instrument pursuant to which such
Indebtedness is issued, does not have an Average Life that is less than the
remaining Average Life of the Indebtedness being refunded and does not permit
redemption or other retirement (including pursuant to any required offer to
purchase to be made by the Company or a Restricted Subsidiary of the Company) of
such Indebtedness at the option of the holder thereof prior to the final stated
maturity of the Indebtedness being refunded, other than a redemption or other
retirement at the option of the holder of such Indebtedness (including pursuant
to a required offer to purchase made by the Company or a Restricted Subsidiary
of the Company) which is conditioned upon a change of control of the Company
pursuant to provisions substantially similar to those contained in Section 4.14
and (C) any Indebtedness Incurred to refund any Indebtedness is Incurred by the
obligor on the Indebtedness being refunded or by the Company; (vi) Indebtedness
of the Company or its Subsidiaries not otherwise permitted to be Incurred
pursuant to clauses (i) through (v) above which, together with any other
outstanding Indebtedness Incurred pursuant to this clause (vi), has an aggregate
principal amount not in excess of $3,000,000 at any time outstanding, which
Indebtedness may be incurred under the Credit Agreement or otherwise; (vii)
commodity agreements of the Company or any of its Restricted Subsidiaries to the
extent
-45-
entered into to protect the Company and its Restricted Subsidiaries from
fluctuations in the prices of raw materials used in their businesses; (viii)
exchange rate agreements of the Company or any of its Restricted Subsidiaries to
the extent entered into to protect the Company and its Restricted Subsidiaries
from fluctuations in exchange rates; (ix) Indebtedness of the Company under the
Private Exchange Securities and Securities issued in exchange for outstanding
Securities pursuant to the terms of an exchange offer registered pursuant to the
Securities Act together with Indebtedness of the Guarantors, if any, under the
Guarantee incurred in accordance with this Indenture; (x) Indebtedness
outstanding on the Issue Date; (xi) Indebtedness (including Capitalized Lease
Obligations) incurred by the Company or any of its Restricted Subsidiaries to
finance the purchase, lease or improvement of property (real or personal) or
equipment (whether through the direct purchase of assets or the Capital Stock of
any Person owning such assets) in an aggregate principal amount outstanding not
to exceed 10% of Tangible Assets at any time (which amount may, but need not, be
incurred in whole or in part under the Credit Agreement) provided that the
principal amount of such Indebtedness does not exceed the fair market value of
such property or equipment; (xii) Indebtedness incurred by the Company or any of
its Restricted Subsidiaries constituting reimbursement obligations with respect
to letters of credit issued in the ordinary course of business, including,
without limitation, letters of credit in respect of workers' compensation claims
or self-insurance, or other Indebtedness with respect to reimbursement type
obligations regarding workers' compensation claims or self-insurance, and
obligations in respect of performance and surety bonds and completion guarantees
provided by the Company or any Restricted Subsidiary of the Company in the
ordinary course of business and (xiii) guarantees by the Company or its
Restricted Subsidiaries of Indebtedness otherwise permitted to be incurred
hereunder.
SECTION 1.045. Limitation on Certain Asset Dispositions.
----------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, make one or more Asset Dispositions
unless: (i) the Company or such Restricted Subsidiary, as the case may be,
receives consideration for such Asset Disposition at least equal to the fair
market value of the assets sold or disposed of as determined by the Board of
Directors of the Company in good faith and evidenced by a resolution of such
Board of Directors filed with the Trustee; (ii) except in the case of a
Permitted Asset Swap, not less than 75% of the consideration for the disposition
consists of cash or readily marketable cash equivalents or the assumption of
-46-
Indebtedness (other than non-recourse Indebtedness or any Subordinated
Indebtedness) of the Company or such Restricted Subsidiary or other obligations
relating to such assets (and release of the Company or such Restricted
Subsidiary from all liability on the Indebtedness or other obligations assumed);
and (iii) all Net Available Proceeds, less any amounts invested within 360 days
of such Asset Disposition in assets related to the business of the Company
(including the Capital Stock of another Person (other than any Person that is a
Restricted Subsidiary of the Company immediately prior to such investment);
provided, however, that immediately after giving effect to any such investment
(and not prior thereto) such Person shall be a Restricted Subsidiary of the
Company), are applied, on or prior to the 360th day after such Asset
Disposition, unless and to the extent that the Company shall determine to make
an Offer to Purchase, to the permanent reduction and prepayment of any Senior
Debt of the Company then outstanding (including a permanent reduction of
commitments in respect thereof). Any Net Available Proceeds from any Asset
Disposition which is subject to the immediately preceding sentence that are not
applied as provided in the immediately preceding sentence shall be used promptly
after the expiration of the 360th day after such Asset Disposition, or promptly
after the Company shall have earlier determined to not apply any Net Available
Proceeds therefrom as provided in clause (iii) of the immediately preceding
sentence, to make an Offer to Purchase outstanding Securities at a purchase
price in cash equal to 100% of their principal amount plus accrued interest to
the Purchase Date. Notwithstanding the foregoing, the Company may defer making
any Offer to Purchase outstanding Securities until there are aggregate
unutilized Net Available Proceeds from Asset Dispositions otherwise subject to
the two immediately preceding sentences equal to or in excess of $5,000,000 (at
which time, the entire unutilized Net Available Proceeds from Asset Dispositions
otherwise subject to the two immediately preceding sentences, and not just the
amount in excess of $5,000,000 shall be applied as required pursuant to this
paragraph). Any remaining Net Available Proceeds following the completion of the
required Offer to Purchase may be used by the Company for any other purpose
(subject to the other provisions of this Indenture) and the amount of Net
Available Proceeds then required to be otherwise applied in accordance with this
Section 4.05 shall be reset to zero, subject to any subsequent Asset
Disposition. These provisions will not apply to a transaction consummated in
compliance with the provisions of Section 5.01.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any
-47-
applicable securities laws and regulations, including any applicable
requirements of Section 14(e) of, and Rule 14e-1 under, the Exchange Act.
SECTION 1.046. Limitation on Restricted Payments.
---------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, (i) declare or pay any dividend, or
make any distribution of any kind or character (whether in cash, property or
securities), in respect of any class of the Capital Stock of the Company or any
of its Restricted Subsidiaries or to the holders thereof, excluding any (x)
dividends or distributions payable solely in shares of Capital Stock of the
Company (other than Disqualified Stock) or in options, warrants or other rights
to acquire Capital Stock of the Company (other than Disqualified Stock), or (y)
in the case of any Restricted Subsidiary of the Company, dividends or
distributions payable to the Company or a Restricted Subsidiary of the Company,
(ii) purchase, redeem, or otherwise acquire or retire for value shares of
Capital Stock of the Company or any of its Restricted Subsidiaries, any options,
warrants or rights to purchase or acquire shares of Capital Stock of the Company
or any of its Restricted Subsidiaries or any securities convertible or
exchangeable into shares of Capital Stock of the Company or any of its
Restricted Subsidiaries, excluding any such shares of Capital Stock, options,
warrants, rights or securities which are owned by the Company or a Restricted
Subsidiary of the Company, (iii) make any Investment in (other than a Permitted
Investment), or payment on a guarantee of any obligation of, any Person, other
than the Company or a direct or indirect Wholly Owned Subsidiary of the Company,
or (iv) redeem, defease, repurchase, retire or otherwise acquire or retire for
value, prior to any scheduled maturity, repayment or sinking fund payment,
Subordinated Indebtedness (each of the transactions described in clauses (i)
through (iv) (other than any exception to any such clause) being a "Restricted
Payment") if at the time thereof: (1) a Default or an Event of Default shall
have occurred and be continuing, or (2) upon giving effect to such Restricted
Payment, the Company could not Incur at least $1.00 of additional Indebtedness
pursuant to clause (i) of Section 4.04, or (3) upon giving effect to such
Restricted Payment, the aggregate of all Restricted Payments made on or after
the Issue Date exceeds the sum of: (a) 50% of cumulative Consolidated Net Income
of the Company (or, in the case cumulative Consolidated Net Income of the
Company shall be negative, less 100% of such deficit) since the end of the
fiscal quarter in which the Issue Date occurs through the last day of the fiscal
quarter for which financial statements are available; plus (b) 100% of the
aggregate net proceeds received after the
-48-
Issue Date, including the fair market value of property other than cash
(determined in good faith by the Board of Directors of the Company as evidenced
by a resolution of such Board of Directors filed with the Trustee), from the
issuance of, or equity contribution with respect to, Capital Stock (other than
Disqualified Stock) of the Company and warrants, rights or options on Capital
Stock (other than Disqualified Stock) of the Company (other than in respect of
any such issuance to a Restricted Subsidiary of the Company) and the principal
amount of Indebtedness of the Company or any of its Restricted Subsidiaries that
has been converted into or exchanged for Capital Stock of the Company which
Indebtedness was Incurred after the Issue Date; plus (c) 100% of the aggregate
after-tax net proceeds, including the fair market value of property other than
cash (determined in good faith by the Board of Directors of the Company as
evidenced by a resolution of such Board of Directors filed with the Trustee) of
the sale or other disposition of any Investment constituting a Restricted
Payment made after the Issue Date; provided that any gain on the sale or
disposition included in such after tax net proceeds shall not be included in
determining Consolidated Net Income for purposes of clause (a) above.
The foregoing provision shall not be violated by (i) any dividend on
any class of Capital Stock of the Company or any of its Restricted Subsidiaries
paid within 60 days after the declaration thereof if, on the date when the
dividend was declared, the Company or such Restricted Subsidiary, as the case
may be, could have paid such dividend in accordance with the provisions of this
Indenture, (ii) the renewal, extension, refunding or refinancing of any
Indebtedness otherwise permitted pursuant to clause (v) of Section 4.04, (iii)
the exchange or conversion of any Indebtedness of the Company or any of its
Restricted Subsidiaries for or into Capital Stock of the Company (other than
Disqualified Stock), (iv) so long as no Default or Event of Default has occurred
and is continuing, any Investment made with the proceeds of a substantially
concurrent sale (other than to a Restricted Subsidiary of the Company) of
Capital Stock of the Company (other than Disqualified Stock); provided, however,
that the proceeds of such sale of Capital Stock shall not be (and have not been)
included in subclause (b) of clause (3) of the preceding paragraph, (v) the
redemption, repurchase, retirement or other acquisition of any Capital Stock of
the Company in exchange for or out of the net cash proceeds of the substantially
concurrent sale (other than to a Restricted Subsidiary of the Company) of
Capital Stock of the Company (other than Disqualified Stock); provided, however,
that the proceeds of such sale of Capital Stock shall not be (and have not been)
included in subclause (b) of clause (3) of the preceding
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paragraph, (vi) the payment of dividends to Holdings in an amount equal to the
amount required for Holdings to pay Federal, state and local income taxes to the
extent such income taxes are attributable to the income of the Company and its
Restricted Subsidiaries, (vii) distributions of up to $500,000 annually to
Holdings to pay its bona fide operating expenses, (viii) other Restricted
Payments of up to $2,500,000 in the aggregate, (ix) the payment of the dividend
to Holdings described herein on the Issue Date in connection with the
consummation of the Transactions, (x) payments in lieu of fractional shares in
an amount not in excess of $100,000 in the aggregate and (xi) distributions to
Holdings to permit Holdings to repurchase its Common Stock at no more than fair
market value (determined in good faith by the Board of Directors of the Company
as evidenced by a resolution of such Board of Directors filed with the Trustee)
from present or former Management Investors (other than Xxxx Xxxxx, Xxxxxxx
Xxxxxxxxx or any of their respective Related Persons or Affiliates) in an amount
not in excess of $2,000,000 in the aggregate. Each Restricted Payment described
in clauses (i) (to the extent not already taken into account for purposes of
computing the aggregate amount of all Restricted Payments pursuant to clause 3
above), (iv), (vii), (viii) (x) and (xi) of the previous sentence shall be taken
into account for purposes of computing the aggregate amount of all Restricted
Payments pursuant to clause (3) of the preceding paragraph.
For purposes of this Section 4.06, (i) an "Investment" shall be deemed
to have been made at the time any Restricted Subsidiary is designated as an
Unrestricted Subsidiary in an amount (proportionate to the Company's equity
interest in such Subsidiary) equal to the net worth of such Restricted
Subsidiary at the time that such Restricted Subsidiary is designated as an
Unrestricted Subsidiary; (ii) at any date the aggregate of all Restricted
Payments made as Investments since the Issue Date shall exclude and be reduced
by an amount (proportionate to the Company's equity interest in such Subsidiary)
equal to the net worth of an Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary, not to exceed, in
the case of any such redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary, the amount of Investments previously made by the Company and the
Restricted Subsidiaries in such Unrestricted Subsidiary (in each case (i) and
(ii) "net worth" to be calculated based upon the fair market value of the assets
of such Subsidiary as of any such date of designation which shall, in no event,
be less than zero); and (iii) any property transferred to or from an
Unrestricted Subsidiary shall be valued at its fair market value at the time of
such transfer.
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SECTION 1.047. Corporate Existence.
-------------------
Subject to Article Five, the Company shall do or shall cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate, partnership or other existence of each of
its Subsidiaries in accordance with the respective organizational documents of
each such Subsidiary and the rights (charter and statutory) and material
franchises of the Company and its Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right or franchise, or the
corporate existence of any Subsidiary, if the Board of Directors of the Company
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Subsidiaries, taken as a whole,
and that the loss thereof is not, and will not be, adverse in any material
respect to the Holders; provided, further, however, that a determination of the
Board of Directors of the Company shall not be required in the event of a merger
of one or more wholly-owned Subsidiaries of the Company with or into another
wholly-owned Subsidiary of the Company or another Person, if the surviving
Person is a wholly-owned Subsidiary of the Company organized under the laws of
the United States or a State thereof or of the District of Columbia.
SECTION 1.048. Payment of Taxes and Other Claims.
---------------------------------
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all material taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary of the
Company or upon the income, profits or property of the Company or any Subsidiary
of the Company and (2) all lawful claims for labor, materials and supplies
which, in each case, if unpaid, might by law become a material liability, or
Lien upon the property, of the Company or any Subsidiary of the Company;
provided, however, that the Company shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which appropriate provision has been made.
SECTION 1.049. Notice of Defaults.
------------------
(1) In the event that any Indebtedness of the Company or any of its
Subsidiaries is declared due and payable before its maturity because of the
occurrence of any default (or any event which, with notice or lapse of time, or
both, would constitute
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such a default) under such Indebtedness, the Company shall promptly give written
notice to the Trustee of such declaration, the status of such default or event
and what action the Company is taking or proposes to take with respect thereto.
(2) Upon becoming aware of any Default or Event of Default, the
Company shall promptly deliver an Officers' Certificate to the Trustee
specifying the Default or Event of Default.
SECTION 4.10. Maintenance of Properties.
-------------------------
The Company shall cause all material properties owned by or leased to
it or any of its Subsidiaries and used or useful in the conduct of its business
or the business of any of its Subsidiaries to be maintained and kept in normal
condition, repair and working order and supplied with all necessary equipment
and shall cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section 4.10 shall prevent the Company or any of its
Subsidiaries from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Board of Directors or of the board of directors of the
Subsidiary concerned, or of an officer (or other agent employed by the Company
or of any of its Subsidiaries) of the Company or such Subsidiary having
managerial responsibility for any such property, desirable in the conduct of the
business of the Company or any of its Subsidiaries, and if such discontinuance
or disposal is not adverse in any material respect to the Holders.
SECTION 4.11. Compliance Certificate.
----------------------
The Company shall deliver to the Trustee within 55 days after the end
of each of the first three fiscal quarters of the Company and within 100 days
after the close of each fiscal year a certificate signed by the principal
executive officer, principal financial officer or principal accounting officer
stating that a review of the activities of the Company has been made under the
supervision of the signing officers with a view to determining whether a Default
or Event of Default has occurred and whether or not the signers know of any
Default or Event of Default by the Company that occurred during such fiscal
quarter or fiscal year. If they do know of such a Default or Event of Default,
the certificate shall describe all such Defaults or Events of Default, their
status and the action the Company is taking or
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proposes to take with respect thereto. The first certificate to be delivered by
the Company pursuant to this Section 4.11 shall be for the fiscal quarter ending
March 31, 1997.
SECTION 4.12. Provision of Financial Information.
----------------------------------
Whether or not the Company is subject to Section 13(a) or 15(d) of the
Exchange Act, or any successor provision thereto, following the effectiveness of
the Exchange Offer the Company shall file with the Commission the annual
reports, quarterly reports and other documents which the Company would have been
required to file with the Commission pursuant to such Section 13(a) or 15(d) or
any successor provision thereto if the Company were so required, such documents
to be filed with the Commission on or prior to the respective dates (the
"Required Filing Dates") by which the Company would have been required so to
----------------------
file such documents if the Company were so required. Regardless of whether the
Company files such reports or other documents with the Commission, the Company
shall (a) within 15 days of each Required Filing Date (i) transmit by mail to
all Holders of Securities as their names and addresses appear in the Register,
without cost to such Holders, and (ii) file with the Trustee, copies of such
annual reports, quarterly reports and other documents, and (b) if filing such
documents by the Company with the Commission is not permitted under the Exchange
Act, promptly upon written request supply copies of such documents to any
prospective holder of Securities.
SECTION 4.13. Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Company 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 or extension law or any usury law
or other law, which would prohibit or forgive the Company from paying all or any
portion of the principal of and/or interest on the Securities as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.14. Change of Control.
-----------------
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Within 30 days following the date of the consummation of a transaction
resulting in a Change of Control, the Company will commence an Offer to Purchase
all outstanding Securities at a purchase price in cash equal to 101% of their
principal amount plus accrued interest to the Purchase Date. Such Offer to
Purchase will be consummated not earlier than 30 days and not later than 60 days
after the commencement thereof. Each Holder shall be entitled to tender all or
any portion of the Securities owned by such Holder pursuant to the Offer to
Purchase, subject to the requirement that any portion of a Security tendered
must be an integral multiple of $1,000 principal amount. A "Change of Control"
-----------------
will be deemed to have occurred in the event that (whether or not otherwise
permitted by this Indenture), after the Issue Date (a) any Person or any Persons
acting together that would constitute a group (for purposes of Section 13(d) of
the Exchange Act, or any successor provision thereto) (a "Group"), together with
-----
any Affiliates or Related Persons thereof, other than Permitted Holders, shall
"beneficially own" (as defined in Rule 13d-3 under the Exchange Act, or any
successor provision thereto) at least 40% of the voting power of the outstanding
Voting Stock of the Company; (b) any sale, lease or other transfer (in one
transaction or a series of related transactions) is made by the Company or any
of its Restricted Subsidiaries of all or substantially all of the consolidated
assets of the Company and its Restricted Subsidiaries to any Person; (c) the
Company consolidates with or merges with or into another Person or any Person
consolidates with, or merges with or into, the Company, in any such event
pursuant to a transaction in which immediately after the consummation thereof
Persons owning a majority of the Voting Stock of the Company immediately prior
to such consummation shall cease to own a majority of the Voting Stock of the
Company or the surviving entity if other than the Company, (d) Continuing
Directors cease to constitute at least a majority of the Board of Directors of
the Company; or (e) the stockholders of the Company approve any plan or proposal
for the liquidation or dissolution of the Company.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act.
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.
----------------------------------------------
The Company shall not (i) directly or indirectly Incur any
Indebtedness that by its terms would expressly rank senior in right of payment
to the Securities and expressly rank subordinate
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in right of payment to any Senior Debt and (ii) permit a Guaran tor, if any, to
and no Guarantor will directly or indirectly Incur any Indebtedness that by its
terms would expressly rank senior in right of payment to the Guarantee of such
Guarantor and expressly rank subordinate in right of payment to any Senior Debt
of such Guarantor.
SECTION 4.16. Limitations Concerning Distributions
and Transfers by Restricted Subsidiaries.
----------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary of the Company to (i) pay, directly or indirectly, dividends or make
any other distributions in respect of its Capital Stock or pay any Indebtedness
or other obligation owed to the Company or any Restricted Subsidiary of the
Company, (ii) make loans or advances to the Company or any Restricted Subsidiary
of the Company or (iii) transfer any of its property or assets to the Company or
any Restricted Subsidiary of the Company, except for such encumbrances or
restrictions existing under or by reason of (a) any agreement in effect on the
Issue Date as any such agreement is in effect on such date, (b) the Credit
Agreement, (c) any agreement relating to any Indebtedness Incurred by such
Restricted Subsidiary prior to the date on which such Restricted Subsidiary was
acquired by the Company and outstanding on such date and not Incurred in
anticipation or contemplation of becoming a Restricted Subsidiary and provided
such encumbrance or restriction shall not apply to any assets of the Company or
its Restricted Subsidiaries other than such Restricted Subsidiary, (d) customary
provisions contained in an agreement which has been entered into for the sale or
disposition of all or substantially all of the Capital Stock or assets of a
Restricted Subsidiary; provided, however, that such encumbrance or restriction
is applicable only to such Restricted Subsidiary or assets, (e) an agreement
effecting a renewal, exchange, refunding, amendment or extension of Indebtedness
Incurred pursuant to an agreement referred to in clause (a) or (b) above;
provided, however, that the provisions contained in such renewal, exchange,
refunding, amendment or extension agreement relating to such encumbrance or
restriction are no more restrictive in any material respect than the provisions
contained in the agreement that is the subject thereof in the reasonable
judgment of the Board of Directors of the Company as evidenced by a resolution
of such Board of Directors filed with the Trustee, (f) this Indenture, (g)
applicable law, (h) customary provisions restricting subletting or assignment of
any lease governing any leasehold interest of
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any Restricted Subsidiary of the Company, (i) restrictions contained in
Indebtedness permitted to be incurred subsequent to the Issue Date pursuant to
Section 4.04; provided that any such restrictions are ordinary and customary
with respect to the type of Indebtedness incurred, (j) purchase money
obligations for property acquired in the ordinary course of business that impose
restrictions of the type referred to in clause (iii) of this covenant or (k)
restrictions of the type referred to in clause (iii) of this covenant contained
in security agreements securing Indebtedness of a Restricted Subsidiary of the
Company to the extent that such Liens were otherwise incurred in accordance with
Section 4.18 and restrict the transfer of property subject to such agreements.
SECTION 4.17. Limitation on Issuance and Sale
of Capital Stock of Restricted Subsidiaries.
-------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, (a) transfer, convey, sell or other wise dispose of any shares
of Capital Stock of any Restricted Subsidiary of the Company (other than to the
Company or a Wholly Owned Subsidiary of the Company), except that the Company
and any such Restricted Subsidiary may, in any single transaction, sell all, but
not less than all, of the issued and outstanding Capital Stock of any such
Restricted Subsidiary to any Person, subject to complying with Section 4.05 and
(b) issue shares of Capital Stock of a Restricted Subsidiary of the Company
(other than directors' qualifying shares), or securities convertible into, or
warrants, rights or options to subscribe for or purchase shares of, Capital
Stock of a Restricted Subsidiary of the Company to any Person other than to the
Company or a Wholly Owned Subsidiary of the Company.
SECTION 4.18. Limitation on Liens.
-------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, incur any Lien on or with respect to any property or assets of
the Company or such Restricted Subsidiary owned on the Issue Date or thereafter
acquired or on the income or profits thereof, which Lien secures Indebtedness,
without making, or causing any such Restricted Subsidiary to make, effective
provision for securing the Securities and all other amounts due under this
Indenture (and, if the Company shall so determine, any other Indebtedness of the
Company or such Restricted Subsidiary, including Subordinated Indebtedness;
provided, however, that Liens securing the Securities and any Indebtedness pari
passu with the Securities are senior to such Liens securing such Subordinated
Indebtedness) equally and
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ratably with such Indebtedness or, in the event such Indebtedness is subordinate
in right of payment to the Securities or the Guarantee, if any, prior to such
Indebtedness, as to such property or assets for so long as such Indebtedness
shall be so secured.
The foregoing restrictions shall not apply to (i) Liens existing on
the Issue Date securing Indebtedness existing on the Issue Date; (ii) Liens
securing Senior Debt (including Liens securing Indebtedness outstanding under
the Credit Agreement) and any guarantees thereof to the extent that the
Indebtedness secured thereby is permitted to be incurred under Section 4.04;
(iii) Liens securing only the Securities and the Guarantees, if any; (iv) Liens
in favor of the Company or a Guarantor, if any; (v) Liens to secure Indebtedness
Incurred for the purpose of financing all or any part of the purchase price or
the cost of construction or improvement of the property (or any other capital
expenditure financing) subject to such Liens; provided, however, that (a) the
aggregate principal amount of any Indebtedness secured by such a Lien does not
exceed 100% of such purchase price or cost, (b) such Lien does not extend to or
cover any other property other than such item of property and any improvements
on such item, (c) the Indebtedness secured by such Lien is Incurred by the
Company within 180 days of the acquisition, construction or improvement of such
property and (d) the Incurrence of such Indebtedness is permitted by Section
4.04; (vi) Liens on property existing immediately prior to the time of
acquisition thereof (and not created in anticipation or contemplation of the
financing of such acquisition); (vii) Liens on property of a Person existing at
the time such Person is acquired or merged with or into or consolidated with the
Company or any such Restricted Subsidiary (and not created in anticipation or
contemplation thereof); (viii) Liens to secure Indebtedness Incurred to extend,
renew, refinance or refund (or successive extensions, renewals, refinancings or
refundings), in whole or in part, any Indebtedness secured by Liens referred to
in the foregoing clauses (i)-(vii) so long as such Liens do not extend to any
other property and the principal amount of Indebtedness so secured is not
increased except for the amount of any premium required to be paid in connection
with such renewal, refinancing or refunding pursuant to the terms of the
Indebtedness renewed, refinanced or refunded or the amount of any premium
reasonably determined by the Company as necessary to accomplish such renewal,
refinancing or refunding by means of a tender offer, exchange offer or privately
negotiated repurchase, plus the expenses of the issuer of such Indebtedness
reasonably incurred in connection with such renewal, refinancing or refunding;
(ix) Liens in favor of the Trustee as provided for in
-57-
this Indenture on money or property held or collected by the Trustee in its
capacity as Trustee; and (x) Liens incurred in the ordinary course of business
securing assets not having a fair market value in excess of $500,000.
SECTION 4.19. Future Guarantors.
------------------
The Company shall not create or acquire, nor permit any of its
Restricted Subsidiaries to create or acquire, any Restricted Subsidiary after
the Issue Date unless, at the time such Restricted Subsidiary has either assets
or stockholder's equity in excess of $25,000, such Restricted Subsidiary
executes and delivers to the Trustee a supplemental indenture in form reasonably
satisfactory to the Trustee pursuant to which such Restricted Subsidiary shall
unconditionally guarantee all of the Company's obligations under the Securities
and this Indenture on the terms set forth in Articles Eleven and Twelve.
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 1.051. Restriction on Mergers, Consolidations
and Certain Sales of Assets.
--------------------------------------
The Company shall not consolidate or merge with or into any Person, or
sell, assign, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary of the Company to consolidate or merge with or into any
Person or sell, assign, lease, convey or otherwise dispose of) all or
substantially all of the Company's assets (determined on a consolidated basis
for the Company and its Restricted Subsidiaries), whether as an entirety or
substantially an entirety in one transaction or a series of related
transactions, including by way of liquidation or dissolution, to any Person
unless, in each such case: (i) the entity formed by or surviving any such
consolidation or merger (if other than the Company or such Restricted
Subsidiary, as the case may be), or to which such sale, assignment, lease,
conveyance or other disposition shall have been made (the "Surviving Entity"),
----------------
is a corporation organized and existing under the laws of the United States, any
state thereof or the District of Columbia; (ii) the Surviving Entity assumes by
supplemental indenture all of the obligations of the Company on the Securities
and under this Indenture; (iii) immediately after giving effect to such
transaction and the use of any net proceeds therefrom on a pro forma basis, the
Company or the Surviving Entity, as the case may be, could Incur at least $1.00
of Indebtedness pursuant to clause (i) of Section 4.04; (iv)
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immediately before and after giving effect to such transaction and treating any
Indebtedness which becomes an obligation of the Company or any of its such
Restricted Subsidiaries as a result of such transaction as having been incurred
by the Company or such Restricted Subsidiary, as the case may be, at the time of
the transaction, no Default or Event of Default shall have occurred and be
continuing; and (v) if, as a result of any such transaction, property or assets
of the Company or a Restricted Subsidiary would become subject to a Lien not
excepted from Section 4.18, the Company, Restricted Subsidiary or the Surviving
Entity, as the case may be, shall have secured the Securities as required by
said Section 4.18. The provisions of this paragraph shall not apply to any
merger of a Restricted Subsidiary of the Company with or into the Company or a
Wholly Owned Subsidiary of the Company or any transaction pursuant to which a
Guarantor, if any, is to be released in accordance with the terms of the
Guarantee and this Indenture in connection with any transaction complying with
the provisions of Section 4.05.
SECTION 1.052. Successor Corporation Substituted.
---------------------------------
Upon any consolidation of the Company or any Subsidiary of the Company
with, or merger of the Company or any such Subsidiary into, any other Person or
any sale, assignment, lease, conveyance or other disposition of all or
substantially all of the Company's consolidated assets (as an entirety or
substantially as an entirety in one transaction or a series of related
transactions, including by way of liquidation or dissolution) in accordance with
Section 5.01, upon the execution of a supplemental indenture by the Surviving
Person in form and substance satisfactory to the Trustee (as evidenced by the
Trustee's execution thereof), the Surviving Person shall succeed to, and be
substituted for, and may exercise every right and power of and shall assume all
obligations of, the Company or such Subsidiary, as the case may be, under this
Indenture and the Securities or the Guarantees, as the case may be, with the
same effect as if such Surviving Person had been named as the Company or such
Subsidiary, as the case may be, herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities or the Guarantees, as the case may be.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 1.061. Events of Default.
-----------------
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An "Event of Default" occurs if:
(1) the Company fails to pay principal of (or premium, if any, on)
Securities when due (whether or not prohibited by Article Eight or Twelve
hereof);
(2) the Company fails to pay any interest on any Security when due and
payable, and the default continues for 30 days (whether or not prohibited
by Article Eight or Twelve hereof);
(3) the Company defaults in the payment of principal of and interest
on Securities required to be purchased pursuant to an Offer to Purchase, as
described under Sections 4.05 or 4.14 hereof, when due and payable (whether
or not prohibited by Article Eight or Twelve hereof);
(4) the Company fails to perform or comply with any of the provisions
of Section 5.01;
(5) the Company fails to perform any other covenant or agreement under
this Indenture or the Securities, and the default continues for 30 days
after written notice to the Company by the Trustee or Holders of at least
25% in aggregate principal amount of outstanding Securities;
(6) the Company defaults under the terms of one or more instruments
evidencing or securing Indebtedness of the Company or any of its
Subsidiaries having an outstanding principal amount of $5,000,000 or more
individually or in the aggregate that has resulted in the acceleration of
the payment of such Indebtedness or the Company or any of its Subsidiaries
fails to pay principal when due at the stated maturity of any such
Indebtedness;
(7) there shall have been rendered any final judgment or judgments
(not subject to appeal) against the Company or any of its Subsidiaries in
an amount of $5,000,000 or more which remains undischarged or unstayed for
a period of 60 days after the date on which the right to appeal has
expired;
(8) the Company or any of its Subsidiaries pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
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(B) consents to the entry of an order for relief against it in an
involuntary case or proceeding,
(C) consents to the appointment of a Custodian of it or for all
or substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(9) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Subsidiary in an
involuntary case or proceeding,
(B) appoints a Custodian of the Company or any Subsidiary or for
all or substantially all of its property, or
(C) orders the liquidation of the Company or any Subsidiary,
and in each case the order or decree remains unstayed and in effect for 60
days; provided, however, that if the entry of such order or decree is
appealed and dismissed on appeal then the Event of Default hereunder by
reason of the entry of such order or decree shall be deemed to have been
cured; or
(10) the Guarantee, if any, ceases to be in full force and effect or
is declared null and void and unenforceable or found to be invalid or any
Guarantor, if any, denies its liability under its Guarantee (other than by
reason of a release of such Guarantor from its Guarantee in accordance with
the terms of this Indenture and the Guarantee).
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
--------------
Federal, state or foreign law for the relief of debtors. The term "Custodian"
---------
means any receiver, trustee, assignee, liquidator, sequestrator or similar
official under any Bankruptcy Law.
SECTION 1.062. Acceleration.
------------
If an Event of Default with respect to the Securities (other than an
Event of Default with respect to the Company described in clause (8) or (9) of
Section 6.01) shall occur and be continuing, the Trustee or the Holders of at
least 25% in
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aggregate principal amount of the outstanding Securities may accelerate the
maturity of all Securities; provided, however, that after such acceleration, but
before a judgment or decree based on acceleration, the Holders of a majority in
aggregate principal amount of outstanding Securities may, under certain
circumstances, rescind and annul such acceleration if all Events of Default,
other than the non-payment of accelerated principal, have been cured or waived
as provided in this Indenture. If an Event of Default specified in clause (8) or
(9) of Section 6.01 with respect to the Company occurs, the outstanding
Securities will ipso facto become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder.
After a declaration of acceleration, but before a judgment or decree
of the money due in respect of the Securities has been obtained, the Holders of
not less than a majority in aggregate principal amount of the Securities then
outstanding by written notice to the Trustee may rescind an acceleration and its
consequences if all existing Events of Default (other than the nonpayment of
principal of and interest on the Securities which has become due solely by
virtue of such acceleration) have been cured or waived and if the rescission
would not conflict with any judgment or decree. No such rescission shall affect
any subsequent Default or impair any right consequent thereto.
SECTION 1.063. Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
maturing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 1.064. Waiver of Past Default.
----------------------
Subject to Sections 2.09, 6.07 and 10.02, prior to the declaration of
acceleration of the Securities, the Holders of not less than a majority in
aggregate principal amount of the out-
-62-
standing Securities by written notice to the Trustee may waive an existing
Default or Event of Default and its consequences, except a Default in the
payment of principal of or interest on any Security as specified in clauses (1)
and (2) of Section 6.01 or a Default in respect of any term or provision of this
Indenture that may not be amended or modified without the consent of each Holder
affected as provided in Section 10.02. The Company shall deliver to the Trustee
an Officers' Certificate stating that the requisite percentage of Holders have
consented to such waiver and attaching copies of such consents. In case of any
such waiver, the Company, the Trustee and the Holders shall be restored to their
former positions and rights hereunder and under the Securities, respectively.
This paragraph of this Section 6.04 shall be in lieu of (S) 316(a)(1)(B) of the
TIA and such (S) 316(a)(1)(B) of the TIA is hereby expressly excluded from this
Indenture and the Securities, as permitted by the TIA.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred for every
purpose of this Indenture and the Securities, but no such waiver shall extend to
any subsequent or other Default or Event of Default or impair any right
consequent thereon.
SECTION 1.065. Control by Majority.
-------------------
Subject to Section 2.09, the Holders of a majority in principal amount
of the outstanding Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Securityholder, or
that may involve the Trustee in personal liability; provided, however, that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. In the event the Trustee takes any action or
follows any direction pursuant to this Indenture, the Trustee shall be entitled
to indemnification satisfactory to it in its sole discretion against any loss or
expense caused by taking such action or following such direction. This Section
6.05 shall be in lieu of (S) 316(a)(1)(A) of the TIA, and such (S) 316(a)(1)(A)
of the TIA is hereby expressly excluded from this Indenture and the Securities,
as permitted by the TIA.
SECTION 1.066. Limitation on Suits.
-------------------
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A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
outstanding Securities make a written request to the Trustee to pursue a
remedy;
(3) such Holder or Holders offer and, if requested, provide to the
Trustee indemnity satisfactory to the Trustee against any loss, liability
or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(5) during such 60-day period the Holders of a majority in principal
amount of the outstanding Securities (excluding Affiliates of the Company)
do not give the Trustee a direction which, in the opinion of the Trustee,
is inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 1.067. Rights of Holders To Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of and interest on the Security, on
or after the respective due dates expressed in the Security, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of the Holder.
SECTION 1.068. Collection Suit by Trustee.
--------------------------
If an Event of Default in payment of interest or principal specified
in Section 6.01(1) or (2) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
or any other obligor on the Securities for the whole amount of principal and
accrued interest remaining unpaid, together with interest overdue on principal
and to the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate per annum borne by the
--- -----
Securities and such
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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 1.069. Trustee May File Proofs of Claim.
--------------------------------
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relative to the Company (or
any other obligor upon the Securities), its creditors or its property and shall
be entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same, and any
Custodian in any such judicial proceedings is hereby authorized by each
Securityholder 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
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
----------
If the Trustee collects any money or property pursuant to this Article
Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for
principal and interest, respectively; and
Third: to the Company.
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The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Securityholders 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 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 shall not apply to a suit by the Trustee, a suit by a Holder
or group of Holders of more than 10% in aggregate principal amount of the
outstanding Securities, or to any suit instituted by any Holder for the
enforcement or the payment of the principal or interest on any Securities on or
after the respective due dates expressed in the Security.
ARTICLE SEVEN
TRUSTEE
SECTION 1.071. Duties of Trustee.
-----------------
(a) If a Default 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 their 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 a Default:
(1) The Trustee shall not be liable except for the performance of such
duties as are specifically set forth herein; 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 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.
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(c) The Trustee shall not be relieved from liability 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 7.01;
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it or it does not receive an indemnity satisfactory to it in
its sole discretion against such risk, liability, loss, fee or expense which
might be incurred by it in compliance with such request or direction.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree with the Company. Money
or assets held in trust by the Trustee need not be segregated from other funds
or assets except to the extent required by law.
SECTION 1.072. Rights of Trustee.
-----------------
Subject to Section 7.01:
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
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(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate and an Opinion of
Counsel, which shall conform to the provisions of Section 13.05. The
Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such certificate or opinion.
(c) The Trustee may act through attorneys and agents of its selection
and shall not be responsible for the misconduct or negligence of any agent
or attorney (other than an agent who is an employee of the Trustee)
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized or
within its rights or powers.
(e) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Inden ture at the request or
direction of any of the Securityholders pursuant to this Indenture, unless
such Securityholders shall have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
SECTION 1.073. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee is subject to Sections
7.10 and 7.11.
SECTION 1.074. 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 Securities, it shall not
be accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company in this Indenture or
any document issued in connection with the sale of Securities or any statement
in the Securities other than the Trustee's certificate of authentication.
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SECTION 1.075. Notice of Defaults.
------------------
If a Default or an Event of Default occurs and is continuing and the
Trustee knows of such Defaults or Events of Default, the Trustee shall mail to
each Securityholder notice of the Default or Event of Default within 30 days
after the occurrence thereof.
SECTION 1.076. Reports by Trustee to Holders.
-----------------------------
If required by TIA (S) 313(a), within 60 days after each June 15
beginning with the June 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a report dated as of such June 15 that
complies with TIA (S) 313(a). The Trustee also shall comply with TIA (S)
313(b), (c) and (d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the Commission and each stock exchange, if
any, on which the Securities are listed.
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any securities exchange or of any delisting thereof.
SECTION 1.077. Compensation and Indemnity.
--------------------------
The Company shall pay to the Trustee from time to time such
compensation as the Company and the Trustee shall from time to time agree in
writing for its services. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances (including fees, disbursements and expenses of its agents and
counsel) incurred or made by it in addition to the compensation for its services
except any such disbursements, expenses and advances as may be attributable to
the Trustee's negligence or bad faith. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents,
accountants, experts and counsel and any taxes or other expenses incurred by a
trust created pursuant to Section 9.01 hereof.
The Company shall indemnify the Trustee and its agents for, and hold
them harmless against any and all loss, damage, claims, liability or expense,
including taxes (other than franchise taxes imposed on the Trustee and taxes
based upon, measured by or determined by the income of the Trustee), arising out
of or in connection with the acceptance or administration of
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the trust or trusts hereunder, including the costs and expenses of enforcing
this Indenture against the Company (including Section 7.07) and of defending
itself against any claim (whether asserted by any Securityholder or the Company)
or liability in connection with the exercise or performance of any of their
powers or duties hereunder, except to the extent that such loss, damage, claim,
liability or expense is due to their own negligence or bad faith. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity. However, the failure by the Trustee to so notify
the Company shall not relieve the Company of its obligations hereunder. The
Company shall defend the claim and the Trustee shall cooperate in the defense
(and may employ its own counsel) at the Company's expense; provided, however,
that the Company's reimbursement obligation with respect to counsel employed by
the Trustee will be limited to the reasonable fees and expenses of such counsel.
The Company need not pay for any settlement made without its written consent,
which consent shall not be unreasonably withheld. The Company need not reimburse
any expense or indemnify against any loss or liability incurred by the Trustee
as a result of the violation of this Indenture by the Trustee.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Securities against all money or property
held or collected by the Trustee, in its capacity as Trustee, except money or
property held in trust to pay principal of or interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(8) or (9) occurs, the expenses (including the
reasonable fees and expenses of its agents and counsel) and the compensation for
the services shall be preferred over the status of the Holders in a proceeding
under any Bankruptcy Law and are intended to constitute expenses of
administration under any Bankruptcy Law. The Company's obligations under this
Section 7.07 and any claim arising hereunder shall survive the resignation or
removal of any Trustee, the discharge of the Company's obligations pursuant to
Article Nine and any rejection or termination under any Bankruptcy Law.
SECTION 1.078. Replacement of Trustee.
----------------------
The Trustee may resign at any time by so notifying the Company in
writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so
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notifying the Trustee and the Company in writing and may appoint a successor
Trustee with the Company's consent. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent under any
Bankruptcy Law;
(3) a custodian or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee pursuant to Section 7.07, all property held
by it as Trustee to the successor Trustee, subject to the Lien provided in
Section 7.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have the rights, powers and duties of
the Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 1.079. Successor Trustee by Merger, etc.
--------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking corporation, the resulting, surviving or transferee
corporation or banking corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee which shall be eligible to
act as Trustee under TIA (S)(S) 310(a)(1) and 310(a)(5). The Trustee (or in the
case of a corporation included in a bank holding company, the related bank
holding company) shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. If the Trustee has or shall acquire any "conflicting interest"
within the meaning of TIA (S) 310(b), the Trustee and the Company shall comply
with the provisions of TIA (S) 310(b); provided, however, that there shall be
excluded from the operation of TIA (S) 310(b)(1) any indenture or indentures
under which other securities, or certificates of interest or participation in
other securities, of the Company are outstanding, if the requirements for such
exclusion set forth in TIA (S) 310(b)(1) are met. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section,
the Trustee shall resign immediately in the manner and with the effect
hereinbefore specified in this Article Seven.
SECTION 7.11. Preferential Collection of Claims
Against Company.
---------------------------------
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
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ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 1.082. Securities Subordinated to Senior Debt.
--------------------------------------
The Company covenants and agrees, and the Trustee and each Holder by
acceptance of the Securities likewise covenants and agrees, that all Securities
shall be issued subject to the provisions of this Article; and each person
holding any Security, whether upon original issue or upon transfer, assignment
or exchange thereof, accepts and agrees that all payments of the principal of
and interest on the Securities by the Company shall, to the extent and in the
manner set forth in this Article, be subordinated and junior in right of payment
to the prior payment in full of all Senior Debt of the Company.
SECTION 1.082. No Payment on Securities in
Certain Circumstances.
---------------------------
(a) No direct or indirect payment by or on behalf of the Company of
principal of, premium, if any, or interest on the Securities, whether pursuant
to the terms of the Securities or upon acceleration or otherwise, will be made
if, at the time of such payment, there exists a default in the payment of all or
any portion of the obligations on any Designated Senior Debt, whether at
maturity, on account of mandatory redemption or prepayment, acceleration or
otherwise (and the Trustee has received written notice thereof), and such
default shall not have been cured or waived or the benefits of this sentence
waived by or on behalf of the holders of such Designated Senior Debt. In
addition, during the continuance of any non-payment default or non-payment event
of default with respect to any Designated Senior Debt pursuant to which the
maturity thereof may be accelerated, and upon receipt by the Trustee of notice
(a "Payment Blockage Notice") from a holder or holders of such Designated Senior
-----------------------
Debt or the trustee or agent acting on behalf of such Designated Senior Debt,
then, unless and until such default or event of default has been cured or waived
or has ceased to exist or such Designated Senior Debt has been discharged or
repaid in full, no payment or distribution will be made by or on behalf of the
Company on account of or with respect to the Securities, except from those funds
held in trust for the benefit of the Holders of any Securities to such Holders,
during a period (a "Payment Blockage Period") commencing on the date of receipt
-----------------------
of such Payment Blockage Notice by the Trustee and ending 179 days thereafter.
Notwithstanding anything herein to the contrary, (x) in no event will a Payment
Blockage Period extend beyond 179 days from the date of the Payment Blockage
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Notice in respect thereof was given and (y) there must be 180 days in any 365
day period during which no Payment Blockage Period is in effect. Not more than
one Payment Blockage Period may be commenced with respect to the Securities
during any period of 365 consecutive days. No default or event of default that
existed or was continuing on the date of commencement of any Payment Blockage
Period with respect to the Designated Senior Debt initiating such Payment
Blockage Period may be, or be made, the basis for the commencement of any other
Payment Blockage Period by the holder or holders of such Designated Senior Debt
or the trustee or agent acting on behalf of such Designated Senior Debt, whether
or not within a period of 365 consecutive days, unless such default or event of
default has been cured or waived for a period of not less than 90 consecutive
days.
(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by Section 8.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Designated Senior Debt or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Designated Senior Debt may have been
issued, as their respective interests may appear, but only to the extent that,
upon notice from the Trustee to the holders of Designated Senior Debt that such
prohibited payment has been made, the holders of the Designated Senior Debt (or
their representative or representatives or a trustee) notify the Trustee in
writing of the amounts then due and owing on the Designated Senior Debt, if any,
and only the amounts specified in such notice to the Trustee shall be paid to
the holders of Designated Senior Debt.
SECTION 1.083. Payment Over of Proceeds upon Dissolution, etc.
----------------------------------------------
(a) Upon any payment or distribution of assets or securities of the
Company of any kind or character, whether in cash, property or securities, upon
any dissolution or winding up or total or partial liquidation or reorganization
of the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become due with respect
to Senior Debt of the Company (including any interest accruing subsequent to an
event of bankruptcy to the extent that such interest is an allowed claim
enforceable against the debtor under the Bankruptcy Code) shall first be paid in
full, or payment provided for, before the Holders of the Securities or the
Trustee on behalf of such Holders shall be entitled to receive any payment by
the Company of the principal of, premium, if any, or interest on the Securities,
or any
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payment to acquire any of the Securities for cash, property or securities, or
any distribution with respect to the Securities of any cash, property or
securities. Before any payment may be made by, or on behalf of, the Company of
the principal of, premium, if any, or interest on the Securities upon any such
dissolution or winding up or liquidation or reorganization, any payment or
distribution of assets or securities of the Company of any kind or character,
whether in cash, property or securities, to which the Holders of the Securities
or the Trustee on their behalf would be entitled, but for the subordination
provisions of this Indenture, shall be made by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, directly to the holders of Senior Debt of the Company
or their representatives or to the trustee or trustees under any indenture
pursuant to which any such Senior Debt may have been issued as their respective
interests may appear, to the extent necessary to pay all such Senior Debt in
full after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of such Senior Debt.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Company of any kind or character, whether in cash, property
or securities, shall be received by the Trustee or any Holder of Securities at a
time when such payment or distribution is prohibited by Section 8.03(a) and
before all obligations in respect of Senior Debt are paid in full, or payment
provided for, such payment or distribution shall be received and held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Senior Debt or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Debt may have been
issued, as their respective interests may appear, for application to the payment
of Senior Debt remaining unpaid until all such Senior Debt has been paid in full
after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of such Senior Debt.
The consolidation of the Company with, or the merger of the Company
with or into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided in Article Five shall not be deemed a dissolution, winding-
up, liquidation or reorganization for the purposes of this Section if such other
corporation shall, as a part of such
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consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article Five.
SECTION 1.084. Subrogation.
-----------
Upon the payment in full of all Senior Debt, or provision for payment,
the Holders of the Securities shall be subrogated to the rights of the holders
of Senior Debt to receive payments or distributions of cash, property or
securities of the Company made on such Senior Debt until the principal of and
interest on the Securities shall be paid in full; and, for the purposes of such
subrogation, no payments or distributions to the holders of the Senior Debt of
any cash, property or securities to which the Holders of the Securities or the
Trustee on their behalf would be entitled except for the provisions of this
Article, and no payment over pursuant to the provisions of this Article to the
holders of Senior Debt by Holders of the Securities or the Trustee on their
behalf shall, as between the Company, its creditors other than holders of Senior
Debt, and the Holders of the Securities, be deemed to be a payment by the
Company to or on account of the Senior Debt. It is understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities, on the one hand,
and the holders of the Senior Debt, on the other hand.
If any payment or distribution to which the Holders of the Securities
would otherwise have been entitled but for the provisions of this Article shall
have been applied, pursuant to the provisions of this Article, to the payment of
all amounts payable under Senior Debt, then and in such case, the Holders of the
Securities shall be entitled to receive from the holders of such Senior Debt any
payments or distributions received by such holders of Senior Debt in excess of
the amount required to make payment in full, or provision for payment, of such
Senior Debt.
SECTION 1.085. Obligations of Company Unconditional.
------------------------------------
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as among the Company and the
Holders of the Securities, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Securities the principal of and
interest on the Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of the Securities and creditors of the Company other than
the holders of the Senior Debt, nor shall anything herein or therein prevent the
Holder of
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any Security or the Trustee on their behalf from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article of the holders of the Senior Debt in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy.
Without limiting the generality of the foregoing, nothing contained in
this Article shall restrict the right of the Trustee or the Holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Senior Debt then due and
payable shall first be paid in full before the Holders of the Securities or the
Trustee are entitled to receive any direct or indirect payment from the Company
of principal of or interest on the Securities.
SECTION 1.086. Notice to Trustee.
-----------------
The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee in respect of the Securities pursuant to the provisions of this
Article. The Trustee shall not be charged with knowledge of the existence of
any default or event of default with respect to any Senior Debt or of any other
facts which would prohibit the making of any payment to or by the Trustee unless
and until the Trustee shall have received notice in writing at its Corporate
Trust Office to that effect signed by an Officer of the Company, or by a holder
of Senior Debt or trustee or agent therefor; and prior to the receipt of any
such written notice, the Trustee shall, subject to Article Seven, be entitled to
assume that no such facts exist; provided that if the Trustee shall not have
received the notice provided for in this Section 8.06 at least two Business Days
prior to the date upon which by the terms of this Indenture any moneys shall
become payable for any purpose (including, without limitation, the payment of
the principal of or interest on any Security), then, regardless of anything
herein to the contrary, the Trustee shall have full power and authority to
receive any moneys from the Company and to apply the same to the purpose for
which they were received, and shall not be affected by any notice to the
contrary which may be received by it on or after such prior date. Nothing
contained in this Section 8.06 shall limit the right of the holders of Senior
Debt to recover payments as contemplated by Section 8.03. The Trustee shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself or itself to be a holder of any Senior Debt
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(or a trustee on behalf of, or other representative of, such holder) to
establish that such notice has been given by a holder of such Senior Debt or a
trustee or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that any
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, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
SECTION 1.087. Reliance on Judicial Order or
Certificate of Liquidating Agent.
--------------------------------
Upon any payment or distribution of assets or securities referred to
in this Article, the Trustee and the Holders of the Securities shall be entitled
to rely upon any order or decree made by any court of competent jurisdiction in
which bankruptcy, dissolution, winding-up, liquidation or reorganization
proceedings are pending, or upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, delivered to the Trustee or to the Holders of the Securities for
the purpose of ascertaining the persons entitled to participate in such
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 1.088. Trustee's Relation to Senior Debt.
---------------------------------
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article with respect to any Senior Debt which may at any time
be held by it in its individual or any other capacity to the same extent as any
other holder of Senior Debt, and nothing in this Indenture shall deprive the
Trustee or any Paying Agent of any of its rights as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article,
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and no implied covenants or obligations with respect to the holders of Senior
Debt shall be read into this Indenture against the Trustee. The Trustee shall
not be deemed to owe any fiduciary duty to the holders of Senior Debt (except as
provided in Section 8.03(b)).
SECTION 1.089. Subordination Rights Not Impaired
by Acts or Omissions of the Company
or Holders of Senior Debt.
-----------------------------------
No right of any present or future holders of any Senior Debt to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.
The provisions of this Article are intended to be for the benefit of, and shall
be enforceable directly by, the holders of Senior Debt.
SECTION 8.10. Securityholders Authorize Trustee To
Effectuate Subordination of Securities.
--------------------------------------
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article, and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or otherwise) tending towards liquidation of the business and assets
of the Company, the filing of a claim for the unpaid balance of its or his
Securities in the form required in those proceedings.
SECTION 8.11. This Article Not To Prevent Events of Default.
---------------------------------------------
The failure to make a payment on account of principal of or interest
on the Securities by reason of any provision of this Article shall not be
construed as preventing the occurrence of an Event of Default specified in
clause (1), (2) or (3) of Section 6.01.
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SECTION 8.12. Trustee's Compensation Not Prejudiced.
-------------------------------------
Nothing in this Article shall apply to amounts due to the Trustee
pursuant to other sections in this Indenture.
SECTION 8.13. No Waiver of Subordination Provisions.
-------------------------------------
Without in any way limiting the generality of Section 8.09, the
holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of the Securities, without
incurring responsibility to the Holders of the Securities and without impairing
or releasing the subordination provided in this Article or the obligations
hereunder of the Holders of the Securities to the holders of Senior Debt, do any
one or more of the following: (a) change the manner, place or terms of payment
or extend the time of payment of, or renew or alter, Senior Debt or any
instrument evidencing the same or any agreement under which Senior Debt is
outstanding or secured; (b) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Senior Debt; (c) release any
Person liable in any manner for the collection of Senior Debt; and (d) exercise
or refrain from exercising any rights against the Company and any other Person.
SECTION 8.14. Subordination Provisions Not Applicable
to Money Held in Trust for Securityholders;
Payments May Be Paid Prior to Dissolution.
------------------------------------------
All money and United States Government Obligations deposited in trust
with the Trustee pursuant to and in accordance with Article Nine shall be for
the sole benefit of the Holders and shall not be subject to this Article Eight.
Nothing contained in this Article or elsewhere in this Indenture shall
prevent (i) the Company, except under the conditions described in Section 8.02,
from making payments of principal of and interest on the Securities, or from
depositing with the Trustee any moneys for such payments or from effecting a
termination of the Company's and the Guarantors' obligations under the
Securities and this Indenture as provided in Article Nine, or (ii) the
application by the Trustee of any moneys deposited with it for the purpose of
making such payments of principal of and interest on the Securities, to the
holders entitled thereto unless at least two Business Days prior to the date
upon which such payment becomes due and payable, the Trustee shall have received
the written notice provided for in Section 8.02(b) or in Section 8.06. The
Company shall give prompt
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written notice to the Trustee of any dissolution, winding-up, liquidation or
reorganization of the Company.
SECTION 8.15. Acceleration of Securities.
--------------------------
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of the Senior Debt of the
acceleration.
ARTICLE NINE
DISCHARGE OF INDENTURE
SECTION 1.091. Termination of Company's Obligations.
------------------------------------
(a) Discharge. Subject to the provisions of Article Eight, the
---------
Company may terminate its substantive obligations and the substantive
obligations of the Guarantors, if any, in respect of the Securities by
delivering all outstanding Securities to the Trustee for cancellation and paying
all sums payable by the Company on account of principal of, premium, if any, and
interest on all Securities or otherwise.
(b) Covenant Defeasance. In addition to the provisions of subsection
-------------------
9.01(a), the Company may, provided that no Default or Event of Default has
occurred and is continuing or would arise therefrom (or, with respect to a
Default or Event of Default specified in clause (8) or (9) of Section 6.01, any
time on or prior to the 95th calendar day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until after
such 95th day)) and provided that no default under any Senior Debt would result
therefrom, terminate its substantive obligations and the substantive obligations
of the Guarantors, if any, in respect of the Securities (except for the
Company's obligation to pay the principal of (and premium, if any, on) and the
interest on the Securities and such Guarantors' guarantee thereof) by (i)
depositing with the Trustee, under the terms of an irrevocable trust agreement,
money or direct non-callable obligations of the United States of America for the
payment of which its full faith and credit is pledged ("United States Government
------------------------
Obligations") sufficient (without reinvestment) to pay all remaining
-----------
indebtedness on the Securities, (ii) delivering to the Trustee either an Opinion
of Counsel or a ruling directed to the Trustee from the Internal Revenue Service
to the effect that the holders of the Securities will not recognize income, gain
or loss for federal income tax purposes as a result of such deposit and
termination of obligations, (iii) delivering to the Trustee an Opinion of
Counsel to the effect
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that the Company's exercise of its option under this paragraph will not result
in the Company, the Trustee or the trust created by the Company's deposit of
funds pursuant to this provision becoming or being deemed to be an "investment
company" under the Investment Company Act of 1940, as amended, and (iv)
delivering to the Trustee an Officers' Certificate and an Opinion of Counsel
each stating that there has been compliance with all conditions precedent
provided for herein.
(c) Legal Defeasance. In addition to the provisions of subsections
----------------
9.01(a) and (b), the Company may, provided that no Default or Event of Default
has occurred, and is continuing or would arise therefrom (or, with respect to a
Default or Event of Default specified in clause (8) or (9) of Section 6.01, any
time on or prior to the 95th calendar day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until after
such 95th day)) and provided that no default under any Senior Debt would result
therefrom, terminate all of its substantive obligations and all of the
substantive obligations of the Guarantors, if any, in respect of the Securities
(including the Company's obligation to pay the principal of (and premium, if
any, on) and interest on the Securities and such Guarantors' guarantee thereof
by (i) depositing with the Trustee, under the terms of an irrevocable trust
agreement, money or United States Government Obligations sufficient (without
reinvestment) to pay all remaining indebtedness on the Securities, (ii)
delivering to the Trustee either a ruling directed to the Trustee from the
Internal Revenue Service to the effect that the holders of the Securities will
not recognize income, gain or loss for federal income tax purposes as a result
of such deposit and termination of obligations or an Opinion of Counsel based
upon such a ruling addressed to the Trustee or a change in the applicable
Federal tax law since the date of this Indenture, to such effect, (iii)
delivering to the Trustee an Opinion of Counsel to the effect that the Company's
exercise of its option under this paragraph will not result in the Company, the
Trustee or the trust created by the Company's deposit of funds pursuant to this
provision becoming or being deemed to be an "investment company" under the
Investment Company Act of 1940, as amended, and (iv) delivering to the Trustee
an Officers' Certificate and an Opinion each stating that there has been
compliance with all conditions precedent provided for herein.
(d) Notwithstanding the foregoing paragraphs 9.01(b) and (c) above,
the Company's obligations contained in Sections 2.03, 2.05, 2.06, 2.07, 4.02,
7.07, 7.08, 9.03 and 9.04 shall survive until the securities are no longer
outstanding. In addition, notwithstanding the foregoing paragraph 9.01(b), in
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that instance the Company's obligations contained in Section 4.01 shall also
survive until the Securities are no longer outstanding. Thereafter the Company's
obligations in Section 7.07, 9.03 and 9.04 shall survive. The Company may make
an irrevocable deposit pursuant to this Section 9.01 only if at such time it is
not prohibited from doing so under the subordination provisions of this
Indenture or any covenants in the instruments governing Senior Debt and the
Company has delivered to the Trustee and any Paying Agent an Officers'
Certificate to that effect. After such delivery or irrevocable deposit and
delivery of an Officer's Certificate and Opinion of Counsel, the Trustee upon a
Company Request shall acknowledge in writing the discharge of the Company's and
the Guarantor's (if any) obligations under the Securities, the Guarantee and
this Indenture other than those surviving obligations specified in this
paragraph (d).
SECTION 1.092. Application of Trust Money.
--------------------------
The Trustee shall hold in trust money or United States Government
Obligations deposited with it pursuant to Section 9.01, and shall apply the
deposited money and the money from United States Government Obligations in
accordance with this Indenture solely to the payment of principal of and
interest on the Securities.
SECTION 1.093. Repayment to Company.
--------------------
Subject to Sections 7.07 and 9.01, the Trustee shall promptly pay to
the Company upon receipt by the Trustee of the Company's written request
accompanied by an Officers' Certificate any excess money held by it at any time.
The Trustee shall pay to the Company upon such request any money held by it for
the payment of principal or interest that remains unclaimed for two years;
provided, however, that the Trustee before being required to make any payment
may at the expense of the Company cause to be published once in a newspaper of
general circulation in The City of New York or mail to each Holder entitled to
such money notice that such money remains unclaimed and that, after a date
specified therein which shall be at least 30 days from the date of such
publication or mailing, any unclaimed balance of such money then remaining shall
be repaid to the Company. After payment to the Company, Securityholders
entitled to money must look to the Company for payment as general creditors
unless an applicable abandoned property law designates another person and all
liability of the Trustee or Paying Agent with respect to such money shall
thereupon cease.
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SECTION 1.094. Reinstatement.
-------------
If the Trustee is unable to apply any money or United States
Government Obligations in accordance with Section 9.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
the Company's and the Guarantors'(if any) obligations under this Indenture and
the Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 9.01 until such time as the Trustee is permitted to apply
all such money or United States Government Obligations in accordance with
Section 9.01; provided, however, that if the Company has made any payment of
interest on or principal of any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money or United States
Government Obligations held by the Trustee.
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 1.101. Without Consent of Holders.
--------------------------
The Company and the Guarantors, if any, when authorized by a
resolution of their respective Boards of Directors, and the Trustee may amend or
supplement this Indenture or the Securities without notice to or consent of any
Securityholder:
(i) to cure any ambiguity, defect or inconsistency; provided,
however, that such amendment or supplement does not adversely affect the
rights of any Holder;
(ii) to effect the assumption by a successor Person of all
obligations of the Company under the Securities and this Indenture in
connection with any transaction complying with Article Five of this
Indenture;
(iii) to provide for uncertificated Securities in addition to or
in place of certificated Securities;
(iv) to comply with any requirements of the Commission in order
to effect or maintain the qualification of this Indenture under the TIA;
(v) to make any change that would provide any additional
benefit or rights to the Holders;
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(vi) to make any other change that does not adversely affect
the rights of any Holder under this Indenture;
(vii) to evidence the succession of another Person to any
Guarantor and the assumption by any such successor of the covenants of such
Guarantor herein and in the Guarantee;
(viii) to add to the covenants of the Company or the Guarantors
for the benefit of the Holders, or to surrender any right or power herein
conferred upon the Company or any Guarantor;
(ix) to secure the Securities pursuant to the requirements of
Section 4.18 or otherwise; or
(x) to reflect the release of a Guarantor from its obligations
with respect to its Guarantee in accordance with the provisions of Section
11.03 and to add a Guarantor pursuant to the requirements of Section 11.07;
provided, however, that the Company has delivered to the Trustee an Opinion of
Counsel and an Officers' Certificate each stating that such amendment or
supplement complies with the provisions of this Section 10.01.
SECTION 1.102. With Consent of Holders.
-----------------------
The Company, the Guarantors, if any, and the Trustee may amend or
supplement this Indenture or the Securities with the written consent of the
Holders of at least a majority in principal amount of the outstanding
Securities. However, without the consent of each Holder affected, an amendment,
supplement or waiver may not:
(1) change the Stated Maturity of the principal of or any installment
of interest on any Security or alter the optional redemption or repurchase
provisions of any Security or this Indenture in a manner adverse to the
holders of the Securities;
(2) reduce the principal amount of any Security;
(3) reduce the rate or extend the time for payment of interest on any
Security;
(4) change the place or currency of payment of the principal of or
interest on any Security;
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(5) modify any provisions of this Indenture relating to the waiver of
past defaults (other than to add sections of this Indenture subject
thereto) or the right of the Holders to institute suit for the enforcement
of any payment on or with respect to any Security or the Guarantee, if any,
or the modification and amendment of this Indenture and the Securities
(other than to add sections of this Indenture or the Securities which may
not be amended, supplemented or waived without the consent of each Holder
affected);
(6) reduce the percentage of the principal amount of outstanding
Securities necessary for amendment to or waiver of compliance with any
provision of this Indenture or the Securities or for waiver of any Default;
(7) waive a default in the payment of principal of, interest on, or
redemption payment with respect to, any Security (except a recision of
acceleration of the Securities by the holders as provided in this Indenture
and a waiver of the payment default that resulted from such acceleration);
(8) modify the ranking or priority of the Securities or the
Guarantee, if any, or modify the definition of Senior Debt or Designated
Senior Debt or amend or modify the subordination provisions of this
Indenture in any manner adverse to the Holders;
(9) release the Guarantors, if any, from any of their respective
obligations under the Guarantee or this Indenture otherwise than in
accordance with this Indenture; or
(10) modify the provisions relating to any Offer to Purchase required
under Section 4.05 or Section 4.14 in a manner materially adverse to the
holders of Securities with respect to any Asset Disposition that has been
consummated or Change of Control that has occurred.
The Holders of a majority in aggregate principal amount of the
outstanding Securities, on behalf of all holders of Securities, may waive
compliance by the Company with certain restrictive provisions of this Indenture.
Subject to certain rights of the Trustee, as provided in this Indenture, the
Holders of a majority in aggregate principal amount of the outstanding
Securities, on behalf of all Holders of Securities, may waive any past default
under this Indenture, except a default in the payment of principal, premium or
interest or a default arising from failure to purchase any Security tendered
pursuant to an
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Offer to Purchase, or a default in respect of a provision that under this
Indenture cannot be modified or amended without the consent of the Holder of
each outstanding Security affected.
SECTION 1.103. Compliance with Trust Indenture Act.
-----------------------------------
Every amendment to or supplement of this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 1.104. Revocation and Effect of Consents.
---------------------------------
Until an amendment or waiver becomes effective, a consent to it by a
Holder is a continuing consent by the Holder and every subsequent Holder of that
Security or portion of that Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by notice to the Trustee or the Company received before the date on
which the Trustee receives an Officers' Certificate certifying that the Holders
of the requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the last
sentence of the immediately preceding paragraph, those persons who were Holders
at such record date (or their duly designated proxies), and only those persons,
shall be entitled to consent to such amendment, supplement or waiver or to
revoke any consent previously given, whether or not such persons continue to be
Holders after such record date. No such consent shall be valid or effective for
more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (10) of Section 10.02. In that case the amendment, supplement or
waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security.
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SECTION 1.105. Notation on or Exchange of Securities.
-------------------------------------
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the
changed terms and return it to the Holder. Alternatively, if the Company or the
Trustee so determines, the Company in exchange for the Security shall issue and
the Trustee shall authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or issue a new Security shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 1.106. Trustee To Sign Amendments, etc.
-------------------------------
The Trustee shall be entitled to receive, and shall be fully protected
in relying upon, an Opinion of Counsel and an Officers' Certificate each stating
that the execution of any amendment, supplement or waiver authorized pursuant to
this Article Ten is authorized or permitted by this Indenture and that such
amendment, supplement or waiver constitutes the legal, valid and binding
obligation of the Company and the Guarantors, enforceable in accordance with its
terms (subject to customary exceptions). The Trustee may, but shall not be
obligated to, execute any such amendment, supplement or waiver which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
In signing any amendment, supplement or waiver, the Trustee shall be entitled to
receive an indemnity reasonably satisfactory to it.
ARTICLE ELEVEN
GUARANTEE
SECTION 1.111. Unconditional Guarantee.
-----------------------
Each Guarantor who becomes a party to this Indenture hereby
unconditionally, jointly and severally, guarantees to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns that: the principal of and interest on the Securities will be
promptly paid in full when due, subject to any applicable grace period, whether
at maturity, by acceleration or otherwise, and interest on the overdue principal
and interest on any overdue interest on the Securities and all other obligations
of the Company to the Holders or the Trustee hereunder or under the Securities
will be promptly paid in full or performed, all in accordance with the terms
hereof and thereof; subject, however, to the limitations
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set forth in Section 11.04. Each such Guarantor hereby agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence of
any action to enforce the same, any waiver or consent by any Holder of the
Securities with respect to any provisions hereof or thereof, the recovery of any
judgment against the Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. Each such Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to require a proceeding first
against the Company, protest, notice and all demands whatsoever and covenants
that the Guarantee will not be discharged except by complete performance of the
obligations contained in the Securities, this Indenture, and this Guarantee. If
any Holder or the Trustee is required by any court or otherwise to return to the
Company, any Guarantor, or any custodian, trustee, liquidator or other similar
official acting in relation to the Company or any Guarantor, any amount paid by
the Company or any Guarantor to the Trustee or such Holder, this Guarantee, to
the extent theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor further agrees that, as between each Guarantor, 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 Article Six for
the purpose 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 acceleration of such obligations
as provided in Article Six, such obligations (whether or not due and payable)
shall forth become due and payable by each Guarantor for the purpose of this
Guarantee.
SECTION 1.112. Severability.
------------
In case any provision of this Guarantee shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 1.113. Release of a Guarantor.
----------------------
If the Securities are defeased in accordance with Section 9.01(c), or
if all or substantially all of the assets of any Guarantor or all of the Capital
Stock of any Guarantor is sold (including by issuance or otherwise) by the
Company or any of its Subsidiaries in a transaction constituting an Asset
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Disposition and if (x) the Net Available Proceeds from such Asset Disposition
are used in accordance with Section 4.05 or (y) the Company delivers to the
Trustee an Officers' Certificate covenanting that the Net Available Proceeds
from such Asset Disposition shall be used in accordance with Section 4.05 and
within the time limits specified by such Section 4.05, then such Guarantor (in
the event of a sale or other disposition of all of the Capital Stock of such
Guarantor) or the corporation acquiring such assets (in the event of a sale or
other disposition of all or substantially all of the assets of such Guarantor),
shall be deemed released from all obligations under this Article Eleven without
any further action required on the part of the Trustee or any Holder. The
Trustee shall, at the sole cost and expense of the Company and upon receipt at
the reasonable request of the Trustee of an Opinion of Counsel that the
provisions of this Section 11.03 have been complied with, deliver an appropriate
instrument evidencing such release upon receipt of a request by the Company
accompanied by an Officers' Certificate certifying as to the compliance with
this Section. Any Guarantor not so released remains liable for the full amount
of principal of and interest on the Securities and the other obligations of the
Company hereunder as provided in this Article Eleven.
SECTION 1.114. Limitation of Guarantor's Liability.
-----------------------------------
Each Guarantor, and by its acceptance hereof each Holder and the
Trustee, hereby confirms that it is the intention of all such parties that the
guarantee by such Guarantor pursuant to its Guarantee not constitute a
fraudulent transfer or conveyance for purposes of title 11 of the United States
Code, as amended, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar U.S. Federal or state or other applicable law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under the Guarantee
shall be limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or
pursuant to Section 11.05, result in the obligations of such Guarantor under the
Guarantee not constituting such fraudulent transfer or conveyance.
SECTION 1.115. Contribution.
------------
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the
----- --
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event any payment or distribution is made by any Guarantor (a "Funding
-------
Guarantor") under the Guarantee, such Funding Guarantor shall be entitled to a
---------
contribution from all other Guarantors in a pro rata amount, based on the net
assets of each Guarantor (including the Funding Guarantor), determined in
accordance with GAAP, subject to Section 11.04, for all payments, damages and
expenses incurred by that Funding Guarantor in discharging the Company's
obligations with respect to the Securities or any other Guarantor's obligations
with respect to the Guarantee.
SECTION 1.116. Execution of Guarantee.
----------------------
To further evidence their Guarantee to the Holders, any Guarantor
required to Guarantee the Securities pursuant to the terms of Section 4.19 shall
execute the Guarantee in substantially the form set forth in Exhibit A hereto to
be endorsed on each Security ordered to be authenticated and delivered by the
Trustee. Each such Guarantor hereby agrees that its Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Security a notation of such Guarantee. Each such Guarantee
shall be signed on behalf of each Guarantor by its Chairman of the Board, its
President or one of its Vice Presidents prior to the authentication of the
Security on which it is endorsed, and the delivery of such Security by the
Trustee, after the authentication thereof hereunder, shall constitute due
delivery of such Guarantee on behalf of such Guarantor. Such signature upon the
Guarantee may be manual or facsimile signature of such officer and may be
imprinted or otherwise reproduced on the Guarantee, and in case such officer who
shall have signed the Guarantee shall cease to be such officer before the
Security on which such Guarantee is endorsed shall have been authenticated and
delivered by the Trustee or disposed of by the Company, such Security
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed the Guarantee had not ceased to be such officer of the
Guarantor.
SECTION 1.117. Subordination of Subrogation and Other Rights.
---------------------------------------------
Each Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of such Guarantor's
obligations under its Guarantee or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of such Guarantor shall be made
before, the payment in full in cash of all outstanding Securities in accordance
with the provisions provided therefor in this Indenture.
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ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 1.121. Guarantee Obligations Subordinated
to Senior Debt of Guarantor.
----------------------------------
Each Guarantor covenants and agrees, and the Trustee and each Holder
of the Securities by his acceptance thereof likewise covenant and agree, that
the Guarantees shall be issued subject to the provisions of this Article; and
each person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees that all payments of the
principal of and interest on the Securities pursuant to the Guarantee made by or
on behalf of any Guarantor shall, to the extent and in the manner set forth in
this Article, be subordinated and junior in right of payment to the prior
payment in full of all amounts payable under Senior Debt of such Guarantor.
SECTION 1.122. No Payment on Guarantees in
Certain Circumstances.
---------------------------
(a) No direct or indirect payment by or on behalf of any Guarantor of
principal of, premium, if any, or interest on the Securities pursuant to such
Guarantor's Guarantee, whether pursuant to the terms of the Securities, upon
acceleration or otherwise, will be made if, at the time of such payment, there
exists a default in the payment of all or any portion of the obligations on any
Designated Senior Debt of such Guarantor whether at maturity, on account of
mandatory redemption or prepayment, acceleration or otherwise (and the Trustee
has received written notice thereof), and such default shall not have been cured
or waived or the benefits of this sentence waived by or on behalf of the holders
of such Designated Senior Debt. In addition, during the continuance of any non-
payment default or event of default with respect to any Designated Senior Debt
pursuant to which the maturity thereof may be accelerated, and upon receipt by
the Trustee of written notice (the "Guarantor Payment Blockage Notice") from a
---------------------------------
holder or holders of such Designated Senior Debt or the trustee or agent acting
on behalf of such Designated Senior Debt, then, unless and until such default or
event of default has been cured or waived or has ceased to exist or such
Designated Senior Debt has been discharged or repaid in full, no payment will be
made by or on behalf of such Guarantor on account of or with respect to the
Securities, except from those funds held in trust for the benefit
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of the Holders of any Securities to such Holders, during a period (a "Guarantor
---------
Blockage Period") commencing on the date of receipt of such notice by the
---------------
Trustee and ending 179 days thereafter.
Notwithstanding anything herein or in the Securities to the contrary,
(x) in no event shall a Guarantor Blockage Period extend beyond 179 days from
the date the Guarantor Payment Blockage Notice was given and (y) there must be
180 days in any 365 day period during which no Guarantor Payment Blockage Period
is in effect. Not more than one Guarantor Blockage Period may be commenced with
respect to any Guarantor during any period of 365 consecutive days. No default
or event of default that existed or was continuing on the date of commencement
of any other Guarantor Blockage Period with respect to the Designated Senior
Debt initiating such Guarantor Payment Blockage Period may be, or be made, the
basis for the commencement of any other Guarantor Blockage Period by the holder
or holders of such Designated Senior Debt or the trustee or agent acting on
behalf of such Designated Senior Debt, whether or not within a period of 365
consecutive days, unless such default or event of default has been cured or
waived for a period of not less than 90 consecutive days.
(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by Section 12.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of such Designated Senior Debt
or their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Designated Senior Debt may have been
issued, as their respective interests may appear, but only to the extent that,
upon notice from the Trustee to the holders of such Designated Senior Debt that
such prohibited payment has been made, the holders of such Designated Senior
Debt (or their representative or representatives or a trustee) notify the
Trustee in writing of the amounts then due and owing on such Designated Senior
Debt, if any, and only the amounts specified in such notice to the Trustee shall
be paid to the holders of such Designated Senior Debt.
SECTION 1.123. Payment Over of Proceeds upon Dissolution, etc.
----------------------------------------------
(a) Upon any payment or distribution of assets or securities of any
Guarantor of any kind or character, whether in cash, property or securities,
upon any dissolution or winding-up or total or partial liquidation or
reorganization of such Guarantor, whether voluntary or involuntary or in
bankruptcy, insolvency, receivership or other proceedings, all amounts due or
to
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become due with respect to all Senior Debt of such Guarantor shall first be paid
in full before the Holders of the Securities or the Trustee on behalf of such
Holders shall be entitled to receive any payment by such Guarantor of the
principal of or interest on the Securities pursuant to such Guarantor's
Guarantee, or any payment to acquire any of the Securities for cash, property or
securities, or any distribution with respect to the Securities of any cash,
property or securities. Before any payment may be made by, or on behalf of, any
Guarantor of the principal of or interest on the Securities upon any such
dissolution or winding-up or liquidation or reorganization, any payment or
distribution of assets or securities of such Guarantor of any kind or character,
whether in cash, property or securities, to which the Holders of the Securities
or the Trustee on their behalf would be entitled, but for the subordination
provisions of this Indenture, shall be made by such Guarantor or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, directly to the holders of the Senior Debt
of such Guarantor or their representatives or to the trustee or trustees under
any indenture pursuant to which any of such Senior Debt may have been issued, as
their respective interests may appear, to the extent necessary to pay all such
Senior Debt in full after giving effect to any concurrent payment, distribution
or provision therefor to or for the holders of such Senior Debt.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of any kind or character, whether in cash, property or securities,
shall be received by the Trustee or any Holder of Securities at a time when such
payment or distribution is prohibited by Section 12.03(a) and before all
obligations in respect of the Senior Debt of such Guarantor are paid in full, or
payment provided for, such payment or distribution shall be received and held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
such Senior Debt or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Debt may have
been issued, as their respective interests may appear, for application to the
payment of such Senior Debt remaining unpaid until all such Senior Debt has been
paid in full after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
(c) The consolidation of any Guarantor with, or the merger of any
Guarantor with or into, another corporation or the liquidation or dissolution of
any Guarantor following the
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conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided in
Article Five or Section 11.03 shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section if such other
corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article Five or such Guarantor or
successor entity shall be released from the Guarantee pursuant to the terms of
Section 11.03.
SECTION 1.124. Subrogation.
-----------
Upon the payment in full of all Senior Debt of a Guarantor, or
provision for payment, the Holders of the Securities shall be subrogated to the
rights of the holders of such Senior Debt to receive payments or distributions
of cash, property or securities of such Guarantor made on such Senior Debt until
the principal of and interest on the Securities shall be paid in full; and, for
the purposes of such subrogation, no payments or distributions to the holders of
such Senior Debt of any cash, property or securities to which the Holders of the
Securities or the Trustee on their behalf would be entitled except for the
provisions of this Article, and no payment over pursuant to the provisions of
this Article to the holders of such Senior Debt by Holders of the Securities or
the Trustee on their behalf shall, as between such Guarantor, its creditors
other than holders of such Senior Debt, and the Holders of the Securities, be
deemed to be a payment by such Guarantor to or on account of such Senior Debt.
It is understood that the provisions of this Article are and are intended solely
for the purpose of defining the relative rights of the Holders of the
Securities, on the one hand, and the holders of Senior Debt of the Guarantors,
on the other hand.
If any payment or distribution to which the Holders of the Securities
would otherwise have been entitled but for the provisions of this Article shall
have been applied, pursuant to the provisions of this Article, to the payment of
all amounts payable under Senior Debt, then and in such case, the Holders of the
Securities shall be entitled to receive from the holders of such Senior Debt any
payments or distributions received by such holders of Senior Debt in excess of
the amount required to make payment in full, or provision for payment, of such
Senior Debt.
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SECTION 1.125. Obligations of Guarantors Unconditional.
---------------------------------------
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities or the Guarantee is intended to or shall impair, as among the
Guarantors and the Holders of the Securities, the obligation of each Guarantor,
which is absolute and unconditional, to pay to the Holders of the Securities the
principal of and interest on the Securities as and when the same shall become
due and payable in accordance with the terms of the Guarantee, or is intended to
or shall affect the relative rights of the Holders of the Securities and
creditors of any Guarantor other than the holders of Senior Debt, nor shall
anything herein or therein prevent the Holder of any Security or the Trustee on
their behalf from exercising all remedies otherwise permitted by applicable law
upon default under this Indenture, subject to the rights, if any, under this
Article of the holders of Senior Debt in respect of cash, property or securities
of any Guarantor received upon the exercise of any such remedy.
Without limiting the generality of the foregoing, nothing contained in
this Article shall restrict the right of the Trustee or the Holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Senior Debt of any Guarantor
then due and payable shall first be paid in full before the Holders of the
Securities or the Trustee are entitled to receive any direct or indirect payment
from such Guarantor of principal of or interest on the Securities pursuant to
such Guarantor's Guarantee.
SECTION 1.126. Notice to Trustee.
-----------------
The Company shall give prompt written notice to the Trustee of any
fact known to the Company or such Guarantor which would prohibit the making of
any payment to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article. The Trustee shall not be charged with knowledge of
the existence of any default or event of default with respect to any Senior Debt
or of any other facts which would prohibit the making of any payment to or by
the Trustee unless and until the Trustee shall have received notice in writing
at its Corporate Trust Office to that effect signed by an Officer of the
Company, or by a holder of Senior Debt or trustee or agent therefor; and prior
to the receipt of any such written notice, the Trustee shall, subject to Article
Seven, be entitled to assume that no such facts exist; provided that if the
Trustee shall not have received the notice provided for in this Section at least
two Business
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Days prior to the date upon which by the terms of this Indenture any moneys
shall become payable for any purpose (including, without limitation, the payment
of the principal of or interest on any Security), then, regardless of anything
herein to the contrary, the Trustee shall have full power and authority to
receive any moneys from any Guarantor and to apply the same to the purpose for
which they were received, and shall not be affected by any notice to the
contrary which may be received by it on or after such prior date. Nothing
contained in this Section 12.06 shall limit the right of the holders of Senior
Debt of a Guarantor to recover payments as contemplated by Section 12.03. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself or itself to be a holder of any Senior Debt of a
Guarantor (or a trustee on behalf of, or other representative of, such holder)
to establish that such notice has been given by a holder of such Senior Debt of
a Guarantor or a trustee or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Debt of a Guarantor to participate in any payment or distribution
pursuant to this Article, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Debt held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article, and if such evidence is not furnished,
the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.
SECTION 1.127. Reliance on Judicial Order or
Certificate of Liquidating Agent.
--------------------------------
Upon any payment or distribution of assets or securities of a
Guarantor referred to in this Article, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or upon a certificate of
the receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities for the purpose of ascertaining the persons entitled to
participate in such distribution, the holders of Senior Debt of such Guarantor
and other indebtedness of such Guarantor, the amount thereof or payable thereon,
the amount or amounts paid or
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distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 1.128. Trustee's Relation to
Senior Debt of Guarantors.
-------------------------
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article with respect to any Senior Debt of Guarantors which
may at any time be held by it in its individual or any other capacity to the
same extent as any other holder of such Senior Debt, and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of its rights as
such holder.
With respect to the holders of a Guarantor's Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article, and no implied covenants or
obligations with respect to the holders of such Senior Debt shall be read into
this Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt of Guarantors (except as provided
in Section 12.03(b)).
SECTION 1.129. Subordination Rights Not Impaired by
Acts or Omissions of the Guarantors or
Holders of Senior Debt of Guarantors.
--------------------------------------
No right of any present or future holders of any Senior Debt of
Guarantors to enforce subordination as provided herein shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of any
Guarantor or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by any Guarantor with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with. The provisions of this Article are intended to be for the
benefit of, and shall be enforceable directly by, the holders of Senior Debt of
Guarantors.
SECTION 1.1201. Securityholders Authorize Trustee To
Effectuate Subordination of Guarantee.
-------------------------------------
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article, and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up,
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liquidation or reorganization of any Guarantor (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of such Guarantor, the filing of a claim
for the unpaid balance of its or his Securities in the form required in those
proceedings.
SECTION 1.121. This Article Not To Prevent Events of Default.
---------------------------------------------
The failure to make a payment on account of principal of or interest
on the Securities by reason of any provision of this Article shall not be
construed as preventing the occurrence of an Event of Default specified in
clauses (1) or (2) of Section 6.01.
SECTION 1.122. Trustee's Compensation Not Prejudiced.
-------------------------------------
Nothing in this Article shall apply to amounts due to the Trustee
pursuant to other sections in this Indenture.
SECTION 1.123. No Waiver of Guarantee
Subordination Provisions.
------------------------
Without in any way limiting the generality of Section 12.09, the
holders of Senior Debt of Guarantors may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Debt of Guarantors, do any one or more of the following: (a) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Senior Debt of Guarantors or any instrument evidencing the same or any
agreement under which such Senior Debt is outstanding or secured; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior Debt; (c) release any Person liable in any manner
for the collection of such Senior Debt; and (d) exercise or refrain from
exercising any rights against any Guarantor and any other Person.
SECTION 1.124. Payments May Be Paid Prior to Dissolution.
-----------------------------------------
Nothing contained in this Article or elsewhere in this Indenture shall
prevent (i) a Guarantor, except under the conditions described in Section
12.02, from making payments of principal of and interest on the Securities, or
from depositing with
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the Trustee any moneys for such payments, or (ii) the application by the Trustee
of any moneys deposited with it for the purpose of making such payments of
principal of and interest on the Securities, to the holders entitled thereto
unless at least two Business Days prior to the date upon which such payment
becomes due and payable, the Trustee shall have received the written notice
provided for in Section 12.02(b) or in Section 12.06. A Guarantor shall give
prompt written notice to the Trustee of any dissolution, winding-up, liquidation
or reorganization of such Guarantor.
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 1.132. Trust Indenture Act Controls.
----------------------------
This Indenture is subject to the provisions of the TIA that are
required to be a part of this Indenture, and shall, to the extent applicable, be
governed by such provisions. If any provision of this Indenture modifies any
TIA provision that may be so modified, such TIA provision shall be deemed to
apply to this Indenture as so modified. If any provision of this Indenture
excludes any TIA provision that may be so excluded, such TIA provision shall be
excluded from this Indenture.
The provisions of TIA (S)(S) 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included unless expressly
excluded by this Indenture) are a part of and govern this Indenture, whether or
not physically contained herein.
SECTION 1.132. Notices.
-------
Any notice or communication shall be sufficiently given if in writing
and delivered in person, by facsimile and confirmed by overnight courier, or
mailed by first-class mail addressed as follows:
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if to the Company:
Pen-Tab Industries, Inc.
000 Xxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attention:
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Xxxxx Xxxx, Esq.
Xxxxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
if to the Trustee:
United States Trust Company of New York
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Corporate Trust Department
Facsimile: (000)000-0000
Telephone: (000)000-0000
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed, first class, postage prepaid, to a
Securityholder, including any notice delivered in connection with TIA (S)
310(b), TIA (S) 313(c), TIA (S) 314(a) and TIA (S) 315(b), shall be mailed to
him at his address as set forth on the registration books of the Registrar and
shall be sufficiently given to him if so mailed within the time prescribed. To
the extent required by the TIA, any notice or communication shall also be mailed
to any Person described in TIA (S) 313(c).
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. Except for a notice to the Trustee, which is deemed given only
when received, if a notice or communication is mailed in the manner provided
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above, it is duly given, whether or not the addressee receives it.
SECTION 1.133. Communications by Holders with Other Holders.
--------------------------------------------
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other person shall
have the protection of TIA (S) 312(c).
SECTION 1.134. Certificate and Opinion as to Conditions
Precedent.
----------------------------------------
Upon any request or application by the Company to the Trustee to take
or refrain from taking any action under this Indenture, the Company shall
furnish to the Trustee at the request of the Trustee:
(1) an Officers' Certificate in form and substance satisfactory to
the Trustee stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with;
(2) an Opinion of Counsel in form and substance satisfactory to the
Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with; and
(3) where applicable, a certificate or opinion by an independent
certified public accountant satisfactory to the Trustee that complies with
TIA (S) 314(c).
SECTION 1.135. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
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(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such person,
such condition or covenant has been complied with; provided, however, that
with respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
SECTION 1.136. Rules by Trustee, Paying Agent, Registrar.
-----------------------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
SECTION 1.137. Governing Law.
-------------
The laws of the State of New York shall govern this Indenture, the
Securities and the Guarantee without regard to principles of conflicts of law.
SECTION 1.138. No Recourse Against Others.
--------------------------
A director, officer, employee or stockholder, as such, of the Company
or any Guarantor shall not have any liability for any obligations of the Company
or any Guarantor under the Securities, the Guarantee or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability.
SECTION 1.139. Successors.
----------
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of each Guarantor in this Indenture
and Securities shall bind its successor. All agreements of the Trustee in
this Indenture shall bind its successor.
SECTION 13.10. 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.
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SECTION 13.11. Severability.
------------
In case any provision in this Indenture, in the Securities or in the
Guarantee 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, and a Holder shall have no claim therefor against any party
hereto.
SECTION 13.12. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 13.13. Legal Holidays.
--------------
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 for the intervening period.
[Signature Page Follows]
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
PEN-TAB INDUSTRIES, INC.
By: /s/ Xxxxxxx Xxxxx
-----------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
UNITED STATES TRUST COMPANY OF NEW YORK, as
Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxxxxxx
------------------------------
Name: Xxxxxxxx X. Xxxxxxxxxxxx
Title: Vice President
EXHIBIT A
PEN-TAB INDUSTRIES, INC.
No. $
10 7/8% SENIOR SUBORDINATED NOTE DUE 2007
Pen-Tab Industries, Inc. promises to pay to
or registered assigns the principal sum of
Dollars on the Maturity Date of February 1, 2007.
Interest Payment Dates: February 1 and August 1, beginning
August 1, 1997.
Record Dates: January 15 and July 15, beginning
July 15, 1997.
IN WITNESS WHEREOF, PEN-TAB INDUSTRIES, INC. has caused this
instrument to be executed in its corporate name by a facsimile signature of its
_________________ and its ___________________ and has caused the facsimile of
its corporate seal to be affixed hereunto or imprinted hereon.
PEN-TAB INDUSTRIES, INC.
By______________________________
Name:
Title:
[SEAL]
Dated: By______________________________
Name:
Title:
Certificate of Authentication:
This is one of the 10 7/8% Senior Subordinated Notes due 2007
referred to in the within-mentioned Indenture.
United States Trust Company
of New York, a Trustee
By____________________ Date:
Authorized Signatory
A-1
(REVERSE OF SECURITY)
PEN-TAB INDUSTRIES, INC.
10 7/8% Senior Subordinated Note due 2007
1. Interest.
--------
Pen-Tab Industries, Inc., a Delaware corporation (the "Company"),
promises to pay interest at the rate of 10 7/8% per annum on the principal
amount of this Security semiannually commencing on August 1, 1997, until the
principal hereof is paid or made available for payment. Interest on the
Securities will accrue from and including the most recent date to which interest
has been paid or, if no interest has been paid, from and including February 1,
1997, through but excluding the date on which interest is paid. If an Interest
Payment Date falls on a day that is not a Business Day, the interest payment to
be made on such Interest Payment Date will be made on the next succeeding
Business Day with the same force and effect as if made on such Interest Payment
Date, and no additional interest will accrue as a result of such delayed
payment. Interest will be computed on the basis of a 360-day year of twelve 30-
day months.
2. Method of Payment.
-----------------
The interest payable on the Securities, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture
(as defined below), be paid to the person in whose name this Security is
registered at the close of business on the regular record date, which shall be
the January 15 or July 15 (whether or not a Business Day) next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for, and any interest payable on such defaulted interest (to the extent
lawful), will forthwith cease to be payable to the Holder on such regular record
date and shall be paid to the person in whose name this Security is registered
at the close of business on a special record date for the payment of such
defaulted interest to be fixed by the Company, notice of which shall be given to
Holders not less than 15 days prior to such special record date. Payment of the
principal of and interest on this Security will be made at the agency of the
Company maintained for that purpose in New York, New York and at any other
office or agency maintained by the Company for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made by check mailed to the
address of the person entitled thereto as such address shall appear in the
Security register.
A-2
3. Paying Agent and Registrar.
--------------------------
Initially, United States Trust Company of New York (the "Trustee")
will act as Paying Agent and Registrar. The Company may change any Paying
Agent, Registrar or co-Registrar without notice to the Holders of Securities.
The Company or any of its Subsidiaries may act as Registrar or co-Registrar but
may not act as Paying Agent.
4. Indenture.
---------
This Security is one of a duly authorized issue of Securities of the
Company, designated as its 10 7/8% Senior Subordinated Notes due 2007 (the
"Securities"), limited in aggregate principal amount to $200,000,000 (except for
Securities issued in substitution for destroyed, lost or stolen Securities)
issuable under an indenture dated as of February 1, 1997 (the "Indenture"),
between the Company and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by the Trust
Indenture Act of 1939 (the "Act") (15 U.S. Code (S)(S) 77aaa-77bbbb) as in
effect on the date of the Indenture. The Securities are subject to all such
terms, and Holders of Securities are referred to the Indenture and the Act for a
statement of them. Each Securityholder, by accepting a Security, agrees to be
bound to all of the terms and provisions of the Indenture, as the same may be
amended from time to time. Payment on each Security is guaranteed on a senior
subordinated basis, jointly and severally, by the Guarantors pursuant to Article
Eleven of the Indenture.
The Securities are subordinated in right of payment to all Senior Debt
of the Company to the extent and in the manner provided in the Indenture. Each
Holder of a Security, by accepting a Security, agrees to such subordination,
authorizes the Trustee to give effect to such subordination and appoints the
Trustee as attorney-in-fact for such purpose.
Capitalized terms contained in this Security to the extent not defined
herein shall have the meanings assigned to them in the Indenture.
A-3
5. Optional Redemption.
-------------------
The Securities will be subject to redemption, at the option of the
Company, in whole or in part, at any time on or after February 1, 2002 and prior
to maturity, upon not less than 30 nor more than 60 days' notice mailed to each
holder of Securities to be redeemed at his address appearing in the register for
the Securities, in amounts of $1,000 or an integral multiple of $1,000, at the
following redemption prices (expressed as percentages of principal amount) plus
accrued interest to but excluding the date fixed for redemption (subject to the
right of holders of record on the relevant Record Date to receive interest due
on an interest payment date that is on or prior to the date fixed for
redemption), if redeemed during the 12-month period beginning February 1 of the
years indicated:
Year Percentage
---- ----------
2002 105.438%
2003 104.625
2004 101.813
2005 and thereafter 100.000
In addition, prior to February 1, 2000, the Company may redeem up to
35% of the principal amount of the Securities (including, for this purpose, one
or more series of Securities issued under the Indenture after the Issue Date)
with the net cash proceeds received by the Company from one or more public
offerings of Capital Stock (other than Disqualified Stock) of the Company or
Holdings, at a redemption price (expressed as a percentage of the principal
amount) of 110.875% of the principal amount thereof, plus accrued and unpaid
interest to the date fixed for redemption; provided, however, that at least
$65,000,000 in aggregate principal amount of the Securities remains outstanding
immediately after any such redemption (excluding any Securities owned by the
Company or any of its Affiliates). Notice of redemption pursuant to this
paragraph must be mailed to holders of Securities not later than 60 days
following the consummation of such public offering.
Selection of Securities for any partial redemption shall be made by
the Trustee, in accordance with the rules of any national securities exchange on
which the Securities may be listed or, if the Securities are not so listed, pro
rata or by lot or in such other manner as the Trustee shall deem appropriate and
fair. Securities in denominations larger than $1,000 may be redeemed in part but
only in integral multiples of $1,000. Notice of redemption will be mailed before
the date fixed for redemption to each holder of Securities to be redeemed at his
or her registered address. On and after the date fixed for redemption, interest
will cease to accrue on Securities or portions thereof called for redemption.
A-4
The Securities will not have the benefit of any sinking fund.
6. Purchase upon Occurrence of a
Change of Control.
-----------------------------
Within 30 days of the occurrence of a Change of Control, the Company
will offer to purchase the Securities, in whole and not in part, at a purchase
price equal to 101% of the principal amount thereof plus any accrued and unpaid
interest thereon.
7. Notice of Redemption.
--------------------
Notice of redemption will be mailed by first class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his registered address. Securities in
denominations larger than $1,000 may be redeemed in part. On and after the
redemption date, interest ceases to accrue on those Securities or portion of
them called for redemption.
8. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form without coupons in denominations
of $1,000 and integral multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not transfer or exchange any Securities selected
for redemption.
9. Persons Deemed Owners.
---------------------
The registered Holder of a Security may be treated as the owner of it
for all purposes.
10. Unclaimed Funds.
---------------
If funds for the payment of principal or interest remain unclaimed for
two years, the Trustee or Paying Agent will repay the funds to the Company at
its request. After such repayment Holders of Securities entitled to such funds
must look to the Company for payment unless an abandoned property law designates
another person.
11. Discharge Prior to Redemption or Maturity.
-----------------------------------------
The Indenture will be discharged and cancelled except for certain
Sections thereof, subject to the terms of the Indenture, upon the payment of
all the Securities or upon the
A-5
irrevocable deposit with the Trustee of funds or United States Government
Obligations sufficient for such payment or redemption.
12. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the outstanding Securities, and any past default or
compliance with any provision may be waived with the consent of the Holders of a
majority in principal amount of the outstanding Securities. Without notice to or
the consent of any Holder, the Company, the Guarantors and the Trustee may amend
or supplement the Indenture or the Securities to cure any ambiguity, defect or
inconsistency, or to make any change that does not adversely affect the rights
of any Holder of Securities.
13. Restrictive Covenants.
---------------------
The Indenture restricts, among other things, the ability of the
Company or any of its Subsidiaries to permit any Liens to be imposed on their
assets, to make certain Restricted Payments and Investments, limits the
Indebtedness which the Company and its Subsidiaries may incur and limits the
terms on which the Company may engage in Asset Dispositions. The Company is
also obligated under certain circumstances to make an offer to purchase
Securities with the net cash proceeds of certain Asset Dispositions. The
Company must report quarterly to the Trustee on compliance with the covenants in
the Indenture.
14. Successor Corporation.
---------------------
Pursuant to the Indenture, the ability of the Company to consolidate
with, merge with or into or transfer its assets to another person is conditioned
upon certain requirements, including certain financial requirements applicable
to the surviving Person.
15. Defaults and Remedies.
---------------------
If an Event of Default shall occur and be continuing, the principal of
all of the outstanding Securities, plus all accrued and unpaid interest, if any,
to the date the Securities become due and payable, may be declared due and
payable in the manner and with the effect provided in the Indenture.
16. Trustee Dealings with Company.
-----------------------------
The Trustee in its individual or any other capacity, may become the
owner or pledgee of Securities and make loans to, accept deposits from, and
perform services for the Company or its
A-6
Affiliates, and may otherwise deal with the Company or its Affiliates, as if it
were not Trustee.
17. No Recourse Against Others.
--------------------------
A director, officer, employee or stockholder, as such, of the Company
or any Guarantor shall not have any liability for any obligations of the Company
or any Guarantor under the Securities, the Guarantee or the Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. Each Holder of a Security by accepting a Security waives and releases
all such liability. The waiver and release are part of the consideration for
the issue of the Securities.
18. Authentication.
--------------
This Security shall not be valid until the Trustee signs the
certificate of authentication on the other side of this Security.
19. Abbreviations.
-------------
Customary abbreviations may be used in the name of Securityholder 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).
20. CUSIP Numbers.
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
21. Governing Law.
-------------
The laws of the State of New York shall govern the Indenture, this
Security and the Guarantee without regard to principles of conflicts of law.
The Company will furnish to any Holder of record of Securities upon
written request and without charge a copy of the Indenture.
A-7
[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
The Guarantor(s) (as defined in the Indenture referred to in the
Security upon which this notation is endorsed) hereby, jointly and severally,
unconditionally guarantee on a senior subordinated basis (such guarantee by each
Guarantor being referred to herein as the "Guarantee") the due and punctual
payment of the principal of, premium, if any, and interest on the Securities,
whether at maturity, by acceleration or otherwise, the due and punctual payment
of interest on the overdue principal, premium and interest, if any, on the
Securities, and the due and punctual performance of all other obligations of the
Company to the Holders or the Trustee, all in accordance with the terms set
forth in Article Eleven of the Indenture.
The obligations of each Guarantor to the Holders of Securities and to
the Trustee pursuant to the Guarantee and the Indenture are expressly set forth,
and are expressly subordinated and subject in right of payment to the prior
payment in full of all Senior Debt of such Guarantor, to the extent and in the
manner provided, in Article Twelve of the Indenture, and reference is hereby
made to such Indenture for the precise terms of the Guarantee therein made.
The Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Securities upon which the Guarantee is
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
This Guarantee shall be governed by and construed in accordance with
the laws of the State of New York without regard to principles of conflicts of
law.
This Guarantee is subject to release upon the terms set forth in the
Indenture.
[ ]
By:_____________________________
Name:
Title:
A-8
ASSIGNMENT FORM
If you the Holder want to assign this Security, fill in the form below
and have your signature guaranteed:
I or we assign and transfer this Security to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ______________________________________, agent to
transfer this Security on the books of the Company. The agent may substitute
another to act for him.
Dated: __________________ Signed: ______________________
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ___________________________________________
A-9
OPTION OF HOLDER TO ELECT PURCHASE
If you the Holder want to elect to have this Security purchased by the Company,
check the box: [_]
If you want to elect to have only part of this Security purchased by the
Company, state the amount: $___________
Dated: ___________ Your signature: _____________________
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: _________________________________________
A-10
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Pen-Tab Industries, Inc.
000 Xxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attention:
[Name and Address of Registrar]
Re: 10 7/8% Senior Subordinated Notes due 2007
Reference is hereby made to the Indenture, dated as of February 1,
1997 (the "Indenture"), between Pen-Tab Industries, Inc. (the "Company"), and
---------
United States Trust Company of New York, 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
----------
Security[s] specified in Annex A hereto in the principal amount of $___ in such
Security[s] (the "Transfer"), to ________ (the "Transferee"), as further
-------- ----------
specified in Annex A hereto. In the event that Transferor holds Physical
Securities, this Certificate is accompanied by one or more certificates
aggregating at least the principal amount of Securities proposed to be
Transferred. In connection with the Transfer, the Transferor hereby certifies
that:
1. [_] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE 144A GLOBAL SECURITY.
---------------------------------------------------------------------
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
---
Securities are being transferred to a Person that the Transferor reasonably
believes is purchasing the Securities 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
Security will be subject to the restrictions on transfer enumerated in the
Securities Act Legend and in the Indenture and the Securities Act.
2. [_] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE REGULATION S GLOBAL
--------------------------------------------------------------------
SECURITY PURSUANT TO REGULATION S. The
---------------------------------
B-1
Transfer is being effected pursuant to and in accordance with 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 904(b) of Regulation S under the Securities Act and (iii)
the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act. Upon consummation of the proposed transfer
in accordance with the terms of the Indenture, the Security will be subject to
the restrictions on Transfer enumerated in the Securities Act Legend printed on
the Regulation S Global Security and in the Indenture and the Securities Act.
3. [_] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A RESTRICTED
-------------------------------------------------------------------
PHYSICAL SECURITY PURSUANT TO RULE 144A OR REGULATION S. One or more of the
-------------------------------------------------------
events specified in Section 2.06(a) of the Indenture have occurred and the
Transfer is being effected in compliance with the transfer restrictions
applicable to Securities bearing the Securities Act Legend and pursuant to and
in accordance with the Securities Act, and accordingly the Transferor hereby
further certifies that (check one):
(a) [_] such Transfer is being effected pursuant to and in accordance
with Rule 144A under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 1 above; or
(b) [_] such Transfer is being effected pursuant to and in accordance
with Rule 904 under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 2 above.
4. [_] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE UNRESTRICTED GLOBAL
--------------------------------------------------------------------
SECURITY 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 the restrictions on transfer contained in the
Indenture and the Securities Act 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 transfer Securities will no
longer be subject to the restrictions on transfer enumerated in the
B-2
Securities Act Legend and in the Indenture and the Securities Act.
5. [_] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE PHYSICAL GLOBAL
----------------------------------------------------------------
SECURITY THAT DOES NOT BEAR THE SECURITIES ACT LEGEND One or more of the events
-----------------------------------------------------
specified in Section 2.06(a) of the Indenture have occurred and 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 the restrictions on transfer contained in the Indenture and the Securities
Act 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 Securities will no longer be subject to the
restrictions on transfer enumerated in the Securities Act Legend and in the
Indenture and the Securities Act.
B-3
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
____________________________________
[Insert Name of Transferor]
By:_________________________________
Name:
Title:
Dated:_________________
B-4
FORM OF ANNEX A TO CERTIFICATE
OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] Interests in the
(i) [_] 144A Global Security (CUSIP _____), or
(ii) [_] Regulation S Global Security (CINS _____).
(b) [_] Physical Security.
2. That the Transferee will hold:
[CHECK ONE]
(a) [_] Interests in the:
(i) [_] 144A Global Security (CUSIP _____), or
(ii) [_] Regulation S Global Security (CINS _____), or
(iii) [_] Unrestricted Global Security (CUSIP _____); or
(b) [_] Physical Securities that bear the Securities Act
Legend;
(c) [_] Physical Securities that do not bear the
Securities Act Legend;
in accordance with the terms of the Indenture.
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Pen-Tab Industries Inc.
000 Xxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attention:
[Name and Address of Registrar]
Re: 10 7/8% Senior Subordinated Notes due 2007
(CUSIP _______________)
Reference is hereby made to the Indenture, dated as of February 1,
1997 (the "Indenture"), between Pen Tab Industries Inc. (the "Company") and
---------
United States Trust Company of New York, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
__________, (the "Holder") owns and proposes to exchange the
------
Security[s] specified herein, in the principal amount of $___ in such
Security[s] (the "Exchange"). In the event Holder holds Physical Securities,
--------
this Certificate is accompanied by one or more certificates aggregating at least
the principal amount of Securities proposed to be Exchanged. In connection with
the Exchange, the Holder hereby certifies that:
1. EXCHANGE OF RESTRICTED PHYSICAL SECURITIES OR INTERESTS IN THE INITIAL
GLOBAL SECURITY FOR PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT
LEGEND OR UNRESTRICTED GLOBAL SECURITIES
(A) [_] CHECK IF EXCHANGE IS FROM INITIAL GLOBAL SECURITIES TO THE
----------------------------------------------------------
UNRESTRICTED GLOBAL SECURITY. In connection with the Exchange of the Holder's
----------------------------
Initial Global Security to the Unrestricted Global Security in an equal
principal amount, the Holder hereby certifies (i) the Unrestricted Global
Securities are being acquired for the Holder's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Initial Global Securities and pursuant to and in
accordance with the Securities Act of 1933, as amended (the "Securities Act")
--------------
and (iii) the restrictions on transfer contained in the Indenture and the
Securities Act Legend are not required in order to maintain compliance with the
Securities Act.
(B) [_] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO AN
--------------------------------------------------------------
INTEREST IN THE UNRESTRICTED GLOBAL SECURITY.
--------------------------------------------
C-1
In connection with the Holder's Exchange of Restricted Physical Securities for
Interest in the Unrestricted Global Security, (i) the Interest in the
Unrestricted Global Security are being acquired for the Holder's own account
without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Physical Securities and pursuant
to and in accordance with the Securities Act and (iii) the restrictions on
transfer contained in the Indenture and the Securities Act Legend are not
required in order to maintain compliance with the Securities Act.
(C) [_] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO
-----------------------------------------------------------
PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT LEGEND. In connection
--------------------------------------------------------------
with the Holder's Exchange of a Restricted Physical Security for Physical
Securities that do not bear the Securities Act Legend, the Holder hereby
certifies (i) the Physical Securities that do not bear the Securities Act Legend
are being acquired for the Holder's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Physical Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act and (iv) one or more of the events specified
in Section 2.06(a) of the Indenture have occurred.
2. [_] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO INTERESTS
---------------------------------------------------------------------
IN AN INITIAL GLOBAL SECURITY . In connection with the Exchange of the Holder's
-----------------------------
Restricted Physical Security for interests in the Initial Global Security in the
[CHECK ONE] [_] 144A Global Security, [_] Regulation S Global Security, with an
equal principal amount, (i) the interests in the Initial Global Security are
being acquired for the Holder's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Physical Security and pursuant to and in accordance
with the Securities Act. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Initial Global Security issued
will be subject to the restrictions on transfer enumerated in the Securities Act
Legend printed on the Initial Global Securities and in the Indenture and the
Securities Act.
C-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
____________________________________
[Insert Name of Holder]
By:_________________________________
Name:
Title:
Dated: __________________
C-3
