EXHIBIT 4.12
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NEBRASKA BOOK COMPANY, INC.,
THE SUBSIDIARY GUARANTORS PARTIES HERETO,
AND
BNY MIDWEST TRUST COMPANY
as Trustee
8-5/8% Senior Subordinated Notes due 2012
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INDENTURE
Dated as of March 4, 2004
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- -------
310(a)(1) ............................................................. 7.10
(a)(2) ............................................................. 7.10
(a)(3) ............................................................. N.A.
(a)(4) ............................................................. N.A.
(b) ................................................................ 7.8; 7.10
(c) ................................................................ N.A.
311(a) ................................................................ 7.11
(b) ................................................................ 7.11
(c) ................................................................ N.A.
312(a) ................................................................ 2.5
(b) ................................................................ 13.3
(c) ................................................................ 13.3
313(a) ................................................................ 7.6
(b)(1) ............................................................. N.A.
(b)(2) ............................................................. 7.6
(c) ................................................................ 7.6
(d) ................................................................ 7.6
314(a) ................................................................ 3.2; 3.17; 13.2
(b) ................................................................ N.A.
(c)(1) ............................................................. 13.4
(c)(2) ............................................................. 13.4
(c)(3) ............................................................. N.A.
(d) ................................................................ N.A.
(e) ................................................................ 13.5
315(a) ................................................................ 7.1
(b) ................................................................ 7.5; 13.2
(c) ................................................................ 7.1
(d) ................................................................ 7.1
(e) ................................................................ 6.11
316(a)(last sentence) ................................................. 13.6
(a)(1)(a) .......................................................... 6.5
(a)(1)(b) .......................................................... 6.4
(a)(2) ............................................................. N.A.
(b) ................................................................ 6.7
317(a)(1) ............................................................. 6.8
(a)(2) ............................................................. 6.9
(b) ................................................................ 2.4
318(a) ................................................................ 13.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.1. Definitions ..................................................... 1
SECTION 1.2. Other Definitions ............................................... 28
SECTION 1.3. Incorporation by Reference of Trust Indenture Act ............... 29
SECTION 1.4. Rules of Construction ........................................... 30
ARTICLE II
The Securities
SECTION 2.1. Form, Dating and Terms .......................................... 30
SECTION 2.2. Execution and Authentication .................................... 38
SECTION 2.3. Registrar and Paying Agent ...................................... 39
SECTION 2.4. Paying Agent To Hold Money in Trust ............................. 39
SECTION 2.5. Securityholder Lists ............................................ 40
SECTION 2.6. Transfer and Exchange ........................................... 40
SECTION 2.7. Form of Certificate to be Delivered in Connection with
Transfers to Institutional Accredited Investors ................. 43
SECTION 2.8. Form of Certificate to be Delivered in Connection with
Transfers Pursuant to Regulation S .............................. 45
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities ................. 46
SECTION 2.10. Outstanding Securities .......................................... 47
SECTION 2.11. Temporary Securities ............................................ 47
SECTION 2.12. Cancellation .................................................... 47
SECTION 2.13. Payment of Interest; Defaulted Interest ......................... 47
SECTION 2.14. Computation of Interest ......................................... 49
SECTION 2.15. CUSIP Numbers ................................................... 49
SECTION 2.16. Issuance of Additional Securities ............................... 49
ARTICLE III
Covenants
SECTION 3.1. Payment of Securities ........................................... 49
SECTION 3.2. SEC Reports and Available Information ........................... 50
SECTION 3.3. Limitation on Indebtedness ...................................... 50
SECTION 3.4. Limitation on Layering .......................................... 54
SECTION 3.5. Limitation on Restricted Payments ............................... 54
SECTION 3.6. Limitation on Restrictions on Distributions from Restricted
Subsidiaries .................................................... 57
Page
SECTION 3.7. Limitation on Sales of Assets and Subsidiary Stock .............. 59
SECTION 3.8. Limitation on Affiliate Transactions ............................ 61
SECTION 3.9. Change of Control ............................................... 62
SECTION 3.10. Limitation on Sale of Capital Stock of Restricted
Subsidiaries .................................................... 64
SECTION 3.11. Limitation on Liens ............................................. 64
SECTION 3.12. Future Subsidiary Guarantors .................................... 64
SECTION 3.13. Limitation on Lines of Business ................................. 65
SECTION 3.14. Maintenance of Office or Agency ................................. 65
SECTION 3.15. Corporate Existence ............................................. 65
SECTION 3.16. [Reserved] ...................................................... 65
SECTION 3.17. Compliance Certificate .......................................... 66
SECTION 3.18. Further Instruments and Acts .................................... 66
SECTION 3.19. Payments for Consent ............................................ 66
SECTION 3.20. Statement by Officers as to Default ............................. 66
ARTICLE IV
Successor Company
SECTION 4.1. Merger and Consolidation ........................................ 66
ARTICLE V
Redemption of Securities
SECTION 5.1. Optional Redemption ............................................. 68
SECTION 5.2. Applicability of Article ........................................ 68
SECTION 5.3. Election to Redeem; Notice to Trustee ........................... 68
SECTION 5.4. Selection by Trustee of Securities to Be Redeemed ............... 68
SECTION 5.5. Notice of Redemption ............................................ 68
SECTION 5.6. Deposit of Redemption Price ..................................... 69
SECTION 5.7. Securities Payable on Redemption Date ........................... 70
SECTION 5.8. Securities Redeemed in Part ..................................... 70
ARTICLE VI
Defaults and Remedies
SECTION 6.1. Events of Default ............................................... 70
SECTION 6.2. Acceleration .................................................... 73
SECTION 6.3. Other Remedies .................................................. 73
SECTION 6.4. Waiver of Past Defaults ......................................... 74
SECTION 6.5. Control by Majority ............................................. 74
SECTION 6.6. Limitation on Suits ............................................. 74
SECTION 6.7. Rights of Holders to Receive Payment ............................ 75
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Page
SECTION 6.8. Collection Suit by Trustee ...................................... 75
SECTION 6.9. Trustee May File Proofs of Claim ................................ 75
SECTION 6.10. Priorities ...................................................... 75
SECTION 6.11. Undertaking for Costs ........................................... 76
ARTICLE VII
Trustee
SECTION 7.1. Duties of Trustee ............................................... 76
SECTION 7.2. Rights of Trustee ............................................... 77
SECTION 7.3. Individual Rights of Trustee .................................... 78
SECTION 7.4. Trustee's Disclaimer ............................................ 78
SECTION 7.5. Notice of Defaults .............................................. 78
SECTION 7.6. Reports by Trustee to Holders ................................... 78
SECTION 7.7. Compensation and Indemnity ...................................... 78
SECTION 7.8. Replacement of Trustee .......................................... 79
SECTION 7.9. Successor Trustee by Merger ..................................... 80
SECTION 7.10. Eligibility; Disqualification ................................... 80
SECTION 7.11. Preferential Collection of Claims Against Company ............... 81
ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.1. Discharge of Liability on Securities; Defeasance ................ 81
SECTION 8.2. Conditions to Defeasance ........................................ 82
SECTION 8.3. Application of Trust Money ...................................... 83
SECTION 8.4. Repayment to Company ............................................ 84
SECTION 8.5. Indemnity for U.S. Government Obligations ....................... 84
SECTION 8.6. Reinstatement ................................................... 84
ARTICLE IX
Amendments
SECTION 9.1. Without Consent of Holders ...................................... 84
SECTION 9.2. With Consent of Holders ......................................... 85
SECTION 9.3. Compliance with Trust Indenture Act ............................. 86
SECTION 9.4. Revocation and Effect of Consents and Waivers ................... 86
SECTION 9.5. Notation on or Exchange of Securities ........................... 87
SECTION 9.6. Trustee To Sign Amendments ...................................... 87
ARTICLE X
Subordination
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Page
SECTION 10.1. Agreement To Subordinate ........................................ 87
SECTION 10.2. Liquidation, Dissolution, Bankruptcy ............................ 87
SECTION 10.3. Default on Senior Indebtedness .................................. 88
SECTION 10.4. Acceleration of Payment of Securities ........................... 89
SECTION 10.5. When Distribution Must Be Paid Over ............................. 89
SECTION 10.6. Subrogation ..................................................... 89
SECTION 10.7. Relative Rights ................................................. 89
SECTION 10.8. Subordination May Not Be Impaired by Company .................... 89
SECTION 10.9. Rights of Trustee and Paying Agent .............................. 89
SECTION 10.10. Distribution or Notice to Representative ........................ 90
SECTION 10.11. Article X Not To Prevent Events of Default or Limit Right
To Accelerate ................................................... 90
SECTION 10.12. Trust Moneys Not Subordinated ................................... 90
SECTION 10.13. Trustee Entitled To Rely ........................................ 90
SECTION 10.14. Trustee To Effectuate Subordination ............................. 91
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness ........ 91
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions ........................................ 91
ARTICLE XI
SECTION 11.1. Subsidiary Guarantee ............................................ 91
SECTION 11.2. Limitation on Liability; Termination, Release and
Discharge ....................................................... 93
SECTION 11.3. Right of Contribution ........................................... 94
SECTION 11.4. No Subrogation .................................................. 94
ARTICLE XII
SECTION 12.1. Agreement To Subordinate ........................................ 95
SECTION 12.2. Liquidation, Dissolution, Bankruptcy ............................ 95
SECTION 12.3. Default on Senior Indebtedness or Guarantor Senior
Indebtedness .................................................... 96
SECTION 12.4. Acceleration of Payment of Securities ........................... 96
SECTION 12.5. When Distribution Must Be Paid Over ............................. 96
SECTION 12.6. Subrogation ..................................................... 96
SECTION 12.7. Relative Rights ................................................. 97
SECTION 12.8. Subordination May Not Be Impaired by Subsidiary
Guarantors ...................................................... 97
SECTION 12.9. Rights of Trustee and Paying Agent .............................. 97
SECTION 12.10. Distribution or Notice to Representative ........................ 98
SECTION 12.11. Article XII Not To Prevent Events of Default or Limit
Right To Accelerate ............................................. 98
SECTION 12.12. Trust Moneys Not Subordinated ................................... 98
SECTION 12.13. Trustee Entitled To Rely ........................................ 98
SECTION 12.14. Trustee To Effectuate Subordination ............................. 99
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Page
SECTION 12.15. Trustee Not Fiduciary for Holders of Guarantor Senior
Indebtedness .................................................... 99
SECTION 12.16. Reliance by Holders of Guarantor Senior Indebtedness on
Indebtedness on Subordination Provisions ........................ 99
ARTICLE XIII
Miscellaneous
SECTION 13.1. Trust Indenture Act Controls .................................... 99
SECTION 13.2. Notices ......................................................... 99
SECTION 13.3. Communication by Holders with other Holders ..................... 100
SECTION 13.4. Certificate and Opinion as to Conditions Precedent .............. 100
SECTION 13.5. Statements Required in Certificate or Opinion ................... 101
SECTION 13.6. When Securities Disregarded ..................................... 101
SECTION 13.7. Rules by Trustee, Paying Agent and Registrar .................... 101
SECTION 13.8. Legal Holidays .................................................. 101
SECTION 13.9. GOVERNING LAW ................................................... 101
SECTION 13.10. No Recourse Against Others ...................................... 101
SECTION 13.11. Successors ...................................................... 102
SECTION 13.12. Multiple Originals .............................................. 102
SECTION 13.13. Variable Provisions ............................................. 102
SECTION 13.14. Qualification of Indenture ...................................... 102
SECTION 13.15. Table of Contents; Headings ..................................... 102
EXHIBIT A Form of the Initial Security
EXHIBIT B Form of the Exchange Security
EXHIBIT C Form of Subsidiary Guarantee
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INDENTURE dated as of March 4, 2004, among NEBRASKA BOOK
COMPANY, INC., a Kansas corporation (the "Company"), THE SUBSIDIARY GUARANTORS
(as defined herein) and BNY MIDWEST TRUST COMPANY, an Illinois trust company
(the "Trustee").
Each party agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders of (i) the
Company's 8-5/8% Senior Subordinated Notes due 2012 issued on the date hereof
(the "Initial Securities"), (ii) if and when issued an unlimited principal
amount of additional 8-5/8% Senior Subordinated Notes due 2012 that may be
offered from time to time subsequent to the Issue Date (the "Additional
Securities"), (iii) in exchange for Initial Securities or any Additional
Securities as provided in the Registration Rights Agreement or a similar
agreement relating to Initial Securities or Additional Securities, the Company's
8-5/8% Senior Subordinated Notes due 2012 (the "Exchange Securities" and,
together with the Initial Securities and any Additional Securities, the
"Securities").
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.1. Definitions.
"Acquired Indebtedness" means Indebtedness (i) of a Person or
any of its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or (ii) assumed in connection with the acquisition of assets from or
merger with such Person, in each case whether or not Incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary or such merger or acquisition. Acquired Indebtedness shall
be deemed to have been Incurred, with respect to clause (i) of the preceding
sentence, on the date such Person becomes a Restricted Subsidiary and, with
respect to clause (ii) of the preceding sentence, on the date of consummation of
such merger or acquisition of assets.
"Additional Assets" means:
(1) any property or assets (other than Indebtedness and
Capital Stock) to be used by the Company or a Restricted Subsidiary in
a Related Business;
(2) the Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or a Restricted Subsidiary; or
(3) Capital Stock constituting a minority interest in any
Person that at such time is a Restricted Subsidiary;
provided, however, that, in the case of clauses (2) and (3),
such Restricted Subsidiary is primarily engaged in a Related Business.
"Additional Securities" has the meaning ascribed to it in the
second introductory paragraph of this Indenture.
2
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing;
provided that beneficial ownership of 10% or more of the Voting Stock of a
Person shall be deemed to be control.
"Asset Disposition" means any direct or indirect sale, lease
(other than an operating lease entered into in the ordinary course of business),
transfer, issuance or other disposition, or a series of related sales, leases,
transfers, issuances or dispositions that are part of a common plan, of shares
of Capital Stock of a Subsidiary (other than directors' qualifying shares),
property or other assets (each referred to for the purposes of this definition
as a "disposition") by the Company or any of its Restricted Subsidiaries,
including any disposition by means of a merger, consolidation or similar
transaction.
Notwithstanding the preceding, the following items shall not
be deemed to be Asset Dispositions:
(1) a disposition by a Restricted Subsidiary to the
Company or by the Company or a Restricted Subsidiary to a Restricted
Subsidiary; provided that in the case of a sale by a Restricted
Subsidiary to another Restricted Subsidiary, the Company directly or
indirectly owns an equal or greater percentage of the Common Stock of
the transferee than of the transferor;
(2) the sale of Cash Equivalents in the ordinary course
of business;
(3) a disposition of inventory in the ordinary course of
business;
(4) a disposition of obsolete or worn out equipment or
equipment that is no longer useful in the conduct of the business of
the Company and its Restricted Subsidiaries and that is disposed of in
each case in the ordinary course of business;
(5) transactions permitted under Section 4.1 of this
Indenture;
(6) an issuance of Capital Stock by a Restricted
Subsidiary to the Company or to a Wholly-Owned Subsidiary;
(7) for purposes of Section 3.7 of this Indenture only,
the making of a Permitted Investment or a disposition subject to
Section 3.5 of this Indenture;
(8) dispositions in connection with Permitted Liens;
(9) dispositions of receivables in connection with the
compromise, settlement or collection thereof in the ordinary course of
business or in bankruptcy or similar proceedings and exclusive of
factoring or similar arrangements;
3
(10) the licensing or sublicensing of intellectual
property or other general intangibles and licenses, leases or subleases
of other property; and
(11) disposition of assets acquired in foreclosures.
"Attributable Indebtedness" in respect of a Sale/Leaseback
Transaction means, as at the time of determination, the present value of the
total obligations of the lessee for rental payments during the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended). Such present value shall be calculated
using a discount rate equal to the rate of interest implicit in such
transaction, determined in accordance with GAAP.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient obtained by
dividing (1) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by (2) the sum of all
such payments.
"Board of Directors" means, as to any Person, the board of
directors of such Person or any duly authorized committee thereof, or, in the
case of a limited liability company, the board of managers or other similar
body.
"Business Day" means each day that is not a Saturday, Sunday
or other day on which banking institutions in New York, New York are authorized
or required by law to close.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participation or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Capitalized Lease Obligations" means an obligation that is
required to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation will be the capitalized amount of such obligation
at the time any determination thereof is to be made as determined in accordance
with GAAP, and the Stated Maturity thereof will be the date of the last payment
of rent or any other amount due under such lease prior to the first date such
lease may be terminated without penalty.
"Cash Equivalents" means:
(1) securities issued or directly and fully guaranteed or
insured by the United States Government or any agency or
instrumentality of the United States (provided that the full faith and
credit of the United States is pledged in support thereof), having
maturities of not more than one year from the date of acquisition;
(2) marketable general obligations issued by any state of
the United States of America or any political subdivision of any such
state or any public instrumentality
4
thereof maturing within one year from the date of acquisition of the
United States (provided that the full faith and credit of the United
States is pledged in support thereof) and, at the time of acquisition,
having a credit rating of "A" or better from either Standard & Poor's
Ratings Services or Xxxxx'x Investors Service, Inc.;
(3) certificates of deposit, time deposits, eurodollar
time deposits, overnight bank deposits or bankers' acceptances having
maturities of not more than one year from the date of acquisition
thereof issued by any commercial bank the long-term debt of which is
rated at the time of acquisition thereof at least "A" or the equivalent
thereof by Standard & Poor's Ratings Services, or "A" or the equivalent
thereof by Xxxxx'x Investors Service, Inc., and having combined capital
and surplus in excess of $500.0 million;
(4) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses
(1), (2) and (3) entered into with any bank meeting the qualifications
specified in clause (3) above;
(5) commercial paper rated at the time of acquisition
thereof at least "A-2" or the equivalent thereof by Standard & Poor's
Ratings Services or "P-2" or the equivalent thereof by Xxxxx'x
Investors Service, Inc., or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of investments, and in any case
maturing within one year after the date of acquisition thereof; and
(6) interests in any investment company or money market
fund which invests 95% or more of its assets in instruments of the type
specified in clauses (1) through (5) above.
"Change of Control" means:
(1) any "person" or "group" of related persons (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act), other
than one or more Permitted Holders, is or becomes the beneficial owner
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that such person or group shall be deemed to have "beneficial
ownership" of all shares that any such person or group has the right to
acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 35% of the
total voting power of the Voting Stock of the Company or Holdings (or
its successor by merger, consolidation or purchase of all or
substantially all of its assets) (for the purposes of this clause, such
person or group shall be deemed to beneficially own any Voting Stock of
the Company or Holdings held by a parent entity, if such person or
group "beneficially owns" (as defined above), directly or indirectly,
more than 35% of the voting power of the Voting Stock of such parent
entity); and (B) the Permitted Holders "beneficially own" (as defined
in Rules 13d-3 and 13d-5 of the Exchange Act), directly or indirectly,
in the aggregate a lesser percentage of the total voting power of the
Voting Stock of the Company or Holdings, as the case may be, (or its
successor by merger, consolidation or purchase of all or substantially
all of its
5
assets) than such other person or group and do not have the right or
ability by voting power, contract or otherwise to elect or designate
for election a majority of the board of directors of the Company or
such successor (for the purposes of this clause, such other person or
group shall be deemed to beneficially own any Voting Stock of a
specified entity held by a parent entity, if such other person or group
"beneficially owns" directly or indirectly, more than 35% of the voting
power of the Voting Stock of such parent entity and the Permitted
Holders "beneficially own" directly or indirectly, in the aggregate a
lesser percentage of the voting power of the Voting Stock of such
parent entity and do not have the right or ability by voting power,
contract or otherwise to elect or designate for election a majority of
the board of directors of such parent entity); or
(2) the first day on which a majority of the members of
the Board of Directors of the Company or Holdings are not Continuing
Directors; or
(3) the sale, lease, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a
series of related transactions, of all or substantially all of the
assets of the Company and its Restricted Subsidiaries taken as a whole
to any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) other than a Permitted Holder; or
(4) the adoption by the stockholders of the Company of a
plan or proposal for the liquidation or dissolution of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Common Stock" means with respect to any Person, any and all
shares, interests or other participations in, and other equivalents (however
designated and whether voting or nonvoting) of such Person's common stock
whether or not outstanding on the Issue Date, and includes, without limitation,
all series and classes of such common stock.
"Company" means Nebraska Book Company, Inc. or a successor.
"Consolidated Coverage Ratio" means as of any date of
determination, with respect to any Person, the ratio of (x) the aggregate amount
of Consolidated EBITDA of such Person for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which financial statements are in existence to (y) Consolidated Interest Expense
for such four fiscal quarters, provided, however, that:
(1) if the Company or any Restricted Subsidiary:
(a) has Incurred any Indebtedness since the
beginning of such period that remains outstanding on such date
of determination or if the transaction giving rise to the need
to calculate the Consolidated Coverage Ratio is an Incurrence
of Indebtedness, Consolidated EBITDA and Consolidated Interest
Expense for such period will be calculated after giving effect
on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such
6
period (except that in making such computation, the amount of
Indebtedness under any revolving credit facility outstanding
on the date of such calculation will be deemed to be (i) the
average daily balance of such Indebtedness during such four
fiscal quarters or such shorter period for which such facility
was outstanding or (ii) if such facility was created after the
end of such four fiscal quarters, the average daily balance of
such Indebtedness during the period from the date of creation
of such facility to the date of such calculation) and the
discharge of any other Indebtedness repaid, repurchased,
defeased or otherwise discharged with the proceeds of such new
Indebtedness as if such discharge had occurred on the first
day of such period; or
(b) has repaid, repurchased, defeased or
otherwise discharged any Indebtedness since the beginning of
the period that is no longer outstanding on such date of
determination or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio involves a discharge
of Indebtedness (in each case other than Indebtedness Incurred
under any revolving credit facility unless such Indebtedness
has been permanently repaid and the related commitment
terminated), Consolidated EBITDA and Consolidated Interest
Expense for such period will be calculated after giving effect
on a pro forma basis to such discharge of such Indebtedness,
including with the proceeds of such new Indebtedness, as if
such discharge had occurred on the first day of such period;
(2) if since the beginning of such period the Company or
any Restricted Subsidiary will have made any Asset Disposition or
disposed of any company, division, operating unit, segment, business,
group of related assets or line of business or if the transaction
giving rise to the need to calculate the Consolidated Coverage Ratio is
such an Asset Disposition or disposition:
(a) the Consolidated EBITDA for such period will
be reduced by an amount equal to the Consolidated EBITDA (if
positive) directly attributable to the assets which are the
subject of such Asset Disposition or disposition for such
period or increased by an amount equal to the Consolidated
EBITDA (if negative) directly attributable thereto for such
period; and
(b) Consolidated Interest Expense for such
period will be reduced by an amount equal to the Consolidated
Interest Expense directly attributable to any Indebtedness of
the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company
and its continuing Restricted Subsidiaries in connection with
such Asset Disposition or disposition for such period (or, if
the Capital Stock of any Restricted Subsidiary is sold, the
Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after
such sale);
7
(3) if since the beginning of such period the Company or
any Restricted Subsidiary (by merger or otherwise) will have made an
Investment in any Restricted Subsidiary (or any Person which becomes a
Restricted Subsidiary or is merged with or into the Company) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made
hereunder, which constitutes all or substantially all of a company,
division, operating unit, segment, business or line of business,
Consolidated EBITDA and Consolidated Interest Expense for such period
will be calculated after giving pro forma effect thereto (including the
Incurrence of any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period; and
(4) if since the beginning of such period any Person
(that subsequently became a Restricted Subsidiary or was merged with or
into the Company or any Restricted Subsidiary since the beginning of
such period) will have Incurred any Indebtedness or discharged any
Indebtedness, made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment pursuant
to clause (2) or (3) above if made by the Company or a Restricted
Subsidiary during such period, Consolidated EBITDA and Consolidated
Interest Expense for such period will be calculated after giving pro
forma effect thereto as if such transaction occurred on the first day
of such period.
For purposes of this definition, whenever pro forma effect is to be given to any
calculation under this definition, the pro forma calculations will be determined
in good faith by a responsible financial or accounting officer of the Company
(including pro forma expense and cost reductions calculated on a basis
consistent with Regulation S-X under the Securities Act). If any Indebtedness
bears a floating rate of interest and is being given pro forma effect, the
interest expense on such Indebtedness will be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in excess of
12 months). If any Indebtedness that is being given pro forma effect bears an
interest rate at the option of the Company, the interest rate shall be
calculated by applying such optional rate chosen by the Company.
"Consolidated EBITDA" for any period means, without
duplication, the Consolidated Net Income for such period, plus the following to
the extent deducted in calculating such Consolidated Net Income:
(1) Consolidated Interest Expense;
(2) Consolidated Income Taxes;
(3) consolidated depreciation expense;
(4) consolidated amortization expense or impairment
charges recorded in connection with the application of Financial
Accounting Standard No. 142, "Goodwill and Other Intangibles;" and
8
(5) other non-cash charges reducing Consolidated Net
Income (excluding any such non-cash charge to the extent it represents
an accrual of or reserve for cash charges in any future period or
amortization of a prepaid cash expense that was paid in a prior period
not included in the calculation).
provided, however, that all transaction costs and expenses payable in connection
with the Transaction and all similar costs and expenses paid in connection with
the Company's recapitalization transaction in which the Company amended and
restated its existing senior secured credit facility and redeemed or repurchased
equity securities, including stock options, for an aggregate purchase price of
approximately $34.5 million, which was consummated on December 10, 2003, shall
be excluded from the calculation of Consolidated EBITDA.
Notwithstanding the preceding sentence, clauses (2) through
(5) relating to amounts of a Restricted Subsidiary of a Person will be added to
Consolidated Net Income to compute Consolidated EBITDA of such Person only to
the extent (and in the same proportion) that the net income (loss) of such
Restricted Subsidiary was included in calculating the Consolidated Net Income of
such Person and, to the extent the amounts set forth in clauses (2) through (5)
are in excess of those necessary to offset a net loss of such Restricted
Subsidiary or if such Restricted Subsidiary has net income for such period
included in Consolidated Net Income, only if a corresponding amount would be
permitted at the date of determination to be dividended to the Company by such
Restricted Subsidiary without prior approval (that has not been obtained),
pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that
Restricted Subsidiary or its stockholders.
"Consolidated Income Taxes" means, with respect to any Person
for any period, taxes imposed upon such Person or other payments required to be
made by such Person by any governmental authority which taxes or other payments
are calculated by reference to the income or profits of such Person or such
Person and its Restricted Subsidiaries (to the extent such income or profits
were included in computing Consolidated Net Income for such period), regardless
of whether such taxes or payments are required to be remitted to any
governmental authority.
"Consolidated Interest Expense" means, for any period, the
total interest expense of the Company and its consolidated Restricted
Subsidiaries, whether paid or accrued, plus, to the extent not included in such
interest expense:
(1) interest expense attributable to Capitalized Lease
Obligations and the interest portion of rent expense associated with
Attributable Indebtedness in respect of the relevant lease giving rise
thereto, determined as if such lease were a capitalized lease in
accordance with GAAP and the interest component of any deferred payment
obligations;
(2) amortization of debt discount and debt issuance cost
(other than such discounts and costs incurred in connection with the
Transaction) (provided that any amortization of bond premium will be
credited to reduce Consolidated Interest Expense
9
unless, pursuant to GAAP, such amortization of bond premium has
otherwise reduced Consolidated Interest Expense);
(3) non-cash interest expense;
(4) commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers' acceptance
financing;
(5) interest actually paid by the Company or any such
Restricted Subsidiary under any Guarantee of Indebtedness or other
obligation of any other Person;
(6) costs associated with Hedging Obligations (including
amortization of fees) provided, however, that if Hedging Obligations
result in net benefits rather than costs, such benefits shall be
credited to reduce Consolidated Interest Expense unless, pursuant to
GAAP, such net benefits are otherwise reflected in Consolidated Net
Income;
(7) the consolidated interest expense of such Person and
its Restricted Subsidiaries that was capitalized during such period;
(8) the product of (a) all dividends paid or payable, in
cash, Cash Equivalents or Indebtedness or accrued during such period on
any series of Disqualified Stock of such Person or on Preferred Stock
of its Restricted Subsidiaries payable to a party other than the
Company or a Wholly-Owned Subsidiary, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the
then current combined federal, state, provincial and local statutory
tax rate of such Person, expressed as a decimal, in each case, on a
consolidated basis and in accordance with GAAP; and
(9) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are
used by such plan or trust to pay interest or fees to any Person (other
than the Company) in connection with Indebtedness Incurred by such plan
or trust.
For the purpose of calculating the Consolidated Coverage Ratio
in connection with the Incurrence of any Indebtedness described in the final
paragraph of the definition of "Indebtedness," the calculation of Consolidated
Interest Expense shall include all interest expense (including any amounts
described in clauses (1) through (9) above) relating to any Indebtedness of the
Company or any Restricted Subsidiary described in the final paragraph of the
definition of "Indebtedness."
For purposes of the foregoing, total interest expense will be
determined (i) after giving effect to any net payments made or received by the
Company and its Subsidiaries with respect to Interest Rate Agreements and (ii)
exclusive of amounts classified as other comprehensive income in the balance
sheet of the Company. Notwithstanding anything to the contrary contained herein,
commissions, discounts, yield and other fees and charges Incurred in connection
with any transaction pursuant to which the Company or its Restricted
Subsidiaries
10
may sell, convey or otherwise transfer or grant a security interest in any
accounts receivable or related assets shall be included in Consolidated Interest
Expense.
"Consolidated Net Income" means, for any period, the net
income (loss) of the Company and its consolidated Restricted Subsidiaries
determined in accordance with GAAP; provided, however, that there will not be
included in such Consolidated Net Income:
(1) any net income (loss) of any Person if such Person is
not a Restricted Subsidiary, except that:
(a) subject to the limitations contained in
clauses (3), (4) and (5) below, the Company's equity in the
net income of any such Person for such period will be included
in such Consolidated Net Income up to the aggregate amount of
cash actually distributed by such Person during such period to
the Company or a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other
distribution to a Restricted Subsidiary, to the limitations
contained in clause (2) below); and
(b) the Company's equity in a net loss of any
such Person (other than an Unrestricted Subsidiary) for such
period will be included in determining such Consolidated Net
Income to the extent such loss has been funded with cash from
the Company or a Restricted Subsidiary;
(2) any net income (but not loss) of any Restricted
Subsidiary if such Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of distributions
by such Restricted Subsidiary, directly or indirectly, to the Company,
except that:
(a) subject to the limitations contained in
clauses (3), (4) and (5) below, the Company's equity in the
net income of any such Restricted Subsidiary for such period
will be included in such Consolidated Net Income up to the
aggregate amount of cash that could have been distributed by
such Restricted Subsidiary during such period to the Company
or another Restricted Subsidiary as a dividend (subject, in
the case of a dividend to another Restricted Subsidiary, to
the limitation contained in this clause); and
(b) the Company's equity in a net loss of any
such Restricted Subsidiary for such period will be included in
determining such Consolidated Net Income;
(3) any gain (loss) realized upon the sale or other
disposition of any property, plant or equipment of the Company or its
consolidated Restricted Subsidiaries (including pursuant to any
Sale/Leaseback Transaction) which is not sold or otherwise disposed of
in the ordinary course of business and any gain (loss) realized upon
the sale or other disposition of any Capital Stock of any Person;
11
(4) any extraordinary gain or loss; and
(5) the cumulative effect of a change in accounting
principles.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company or Holdings, as the case may
be, who: (1) was a member of such Board of Directors on the day immediately
following the Issue Date; or (2) was nominated for election or elected to such
Board of Directors with the approval of a majority of the Continuing Directors
who were members of such the relevant Board at the time of such nomination or
election.
"Credit Agreement" means one or more debt facilities
(including, without limitation, the Credit Agreement, dated as of February 13,
1998, as amended and restated as of December 10, 2003 and as further amended and
restated on or about March 4, 2004, among the Company, Holdings, New Holdings,
the several banks and other financial institutions or entities from time to time
parties thereto, the eligible subsidiaries referred to therein, JPMorgan Chase
Bank, as administrative agent and collateral agent, Citigroup Global Markets
Inc., as syndication agent and Fleet National Bank as documentation agent) or
commercial paper facilities to which the Company is a party with banks or other
institutional lenders providing for revolving credit loans, term loans,
receivables financing (including through the sale of receivables to such lenders
or to special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time
(and whether or not with the original administrative agent and lenders or
another administrative agent or agents or other lenders and whether provided
under the original credit agreement or any other credit or other agreement or
indenture).
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Defaulted Interest" shall have the meaning set forth in
Section 2.13.
"Depositary" means The Depository Trust Company, its nominees
and their respective successors and assigns, or such other depository
institution hereinafter appointed by the Company.
"Designated Senior Indebtedness" means (1) the Indebtedness
under the Credit Agreement and (2) any other Senior Indebtedness which, at the
date of determination, has an aggregate principal amount outstanding of, or
under which, at the date of determination, the holders thereof are committed to
lend up to, at least $25.0 million and is specifically designated in the
instrument evidencing or governing such Senior Indebtedness as "Designated
Senior Indebtedness" for purposes of this Indenture.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock 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:
12
(1) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise;
(2) is convertible or exchangeable for Indebtedness or
Disqualified Stock (excluding Capital Stock which is convertible or
exchangeable solely at the option of the Company or a Restricted
Subsidiary); or
(3) is redeemable at the option of the holder of the
Capital Stock in whole or in part,
in each case on or prior to the date that is 91 days after the earlier of the
date (a) of the Stated Maturity of the Securities or (b) on which there are no
Securities outstanding, provided that only the portion of Capital Stock which so
matures or is mandatorily redeemable, is so convertible or exchangeable or is so
redeemable at the option of the holder thereof prior to such date will be deemed
to be Disqualified Stock; provided, further that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of a
change of control or asset sale (each defined in a substantially identical
manner to the corresponding definitions in this Indenture) shall not constitute
Disqualified Stock if the terms of such Capital Stock (and all such securities
into which it is convertible or for which it is ratable or exchangeable) provide
that the Company may not repurchase or redeem any such Capital Stock (and all
such securities into which it is convertible or for which it is ratable or
exchangeable) pursuant to such provision prior to compliance by the Company with
the provisions of Section 3.9 and Section 3.7 of this Indenture and such
repurchase or redemption complies with Section 3.5 of this Indenture.
"8 3/4% Notes" means the senior subordinated notes of the
Company due 2008.
"Equity Offering" means an offering or issuance for cash by
either of the Company or Holdings or New Holdings of its respective common
stock, Preferred Stock (other than any Disqualified Stock) or options, warrants
or rights with respect to its common stock or Preferred Stock (other than any
Disqualified Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Securities" has the meaning ascribed to it in the
second introductory paragraph of this Indenture.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect as of the date of this Indenture,
including those set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession. All ratios and computations based on GAAP
contained in this Indenture will be computed in conformity with GAAP.
13
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness of any other
Person and any obligation, direct or indirect, contingent or otherwise, of such
Person:
(1) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness of such other Person
(whether arising by virtue of partnership arrangements, or by agreement
to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or
otherwise); or
(2) entered into for purposes of assuring in any other
manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in
part); provided, however, that the term "Guarantee" will not include
endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding
meaning.
"Guarantor Senior Indebtedness" means, with respect to a
Subsidiary Guarantor, the following obligations, whether outstanding on the date
of this Indenture or thereafter issued, without duplication:
(1) any Guarantee of Indebtedness and other obligations
under the Credit Agreement by such Subsidiary Guarantor and all other
Guarantees by such Subsidiary Guarantor of Senior Indebtedness of the
Company or Guarantor Senior Indebtedness of any other Subsidiary
Guarantor; and
(2) all obligations consisting of principal of and
premium, if any, accrued and unpaid interest on, and fees and other
amounts relating to, all Indebtedness of the Subsidiary Guarantor.
Guarantor Senior Indebtedness includes interest accruing on or after
the filing of any petition in bankruptcy or for reorganization relating
to the Subsidiary Guarantor regardless of whether postfiling interest
is allowed in such proceeding.
Notwithstanding anything to the contrary in the preceding
paragraph, Guarantor Senior Indebtedness will not include:
(1) any Indebtedness Incurred in violation of this
Indenture;
(2) any obligations of such Subsidiary Guarantor to
another Subsidiary or the Company;
(3) any liability for Federal, state, local, foreign or
other taxes owed or owing by such Subsidiary Guarantor;
(4) any accounts payable or other liability to trade
creditors arising in the ordinary course of business (including
Guarantees thereof or instruments evidencing such liabilities);
14
(5) any Indebtedness, Guarantee or obligation of such
Subsidiary Guarantor that is expressly subordinate or junior in right
of payment to any other Indebtedness, Guarantee or obligation of such
Subsidiary Guarantor, including, without limitation, any Guarantor
Senior Subordinated Indebtedness and Guarantor Subordinated Obligations
of such Guarantor; or
(6) any Capital Stock.
"Guarantor Senior Subordinated Indebtedness" means, with
respect to a Subsidiary Guarantor, the obligations of such Subsidiary Guarantor
under the Subsidiary Guarantee and any other Indebtedness of such Subsidiary
Guarantor (whether outstanding on the Issue Date or thereafter Incurred) that
specifically provides that such Indebtedness is to rank equally in right of
payment with the obligations of such Subsidiary Guarantor under the Subsidiary
Guarantee and is not expressly subordinated by its terms in right of payment to
any Indebtedness of such Subsidiary Guarantor which is not Guarantor Senior
Indebtedness of such Subsidiary Guarantor.
"Guarantor Subordinated Obligation" means, with respect to a
Subsidiary Guarantor, any Indebtedness of such Subsidiary Guarantor (whether
outstanding on the Issue Date or thereafter Incurred) which is expressly
subordinate in right of payment to the obligations of such Subsidiary Guarantor
under its Subsidiary Guarantee pursuant to a written agreement.
"Hedging Obligations" of any Person means the obligations of
such Person pursuant to any Interest Rate Agreement.
"Holder", "holder" or "Securityholder" means the Person in
whose name a Security is registered in the Note Register.
"Holdings" means NBC Acquisition Corp., a Delaware
corporation.
"Holdings Senior Discount Notes" means the 11% senior discount
notes due 2013 issued by Holdings on the Issue Date.
"Incur" means issue, create, assume, Guarantee, incur or
otherwise become liable for; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such person becomes a Restricted
Subsidiary (whether by merger, consolidation, acquisition or otherwise) will be
deemed to be Incurred by such Restricted Subsidiary at the time it becomes a
Restricted Subsidiary; and the terms "Incurred" and "Incurrence" have meanings
correlative to the foregoing.
"Indebtedness" means, with respect to any Person on any date
of determination (without duplication):
(1) the principal of and premium (if any) in respect of
indebtedness of such Person for borrowed money;
15
(2) the principal of and premium (if any) in respect of
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(3) the principal component of all obligations of such
Person in respect of letters of credit, bankers' acceptances or other
similar instruments (including reimbursement obligations with respect
thereto except to the extent such reimbursement obligation relates to a
trade payable and such obligation is satisfied within 30 days of
Incurrence);
(4) the principal component of all obligations of such
Person to pay the deferred and unpaid purchase price of property
(except trade payables), which purchase price is due more than six
months after the date of placing such property in service or taking
delivery and title thereto;
(5) Capitalized Lease Obligations and all Attributable
Indebtedness of such Person;
(6) the principal component or liquidation preference of
all obligations of such Person with respect to the redemption,
repayment or other repurchase of any Disqualified Stock or, with
respect to any Subsidiary that is not a Subsidiary Guarantor, any
Preferred Stock (but excluding, in each case, any accrued dividends);
(7) the principal component of all Indebtedness of other
Persons secured by a Lien on any asset of such Person, whether or not
such Indebtedness is assumed by such Person; provided, however, that
the amount of such Indebtedness will be the lesser of (a) the fair
market value of such asset at such date of determination and (b) the
amount of such Indebtedness of such other Persons;
(8) the principal component of Indebtedness of other
Persons to the extent Guaranteed by such Person; and
(9) to the extent not otherwise included in this
definition, net obligations of such Person under Interest Rate
Agreements (the amount of any such obligations to be equal at any time
to the termination value of such agreement or arrangement giving rise
to such obligation that would be payable by such Person at such time).
The amount of Indebtedness of any Person at any date will be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date.
In addition, "Indebtedness" of any Person shall include
Indebtedness described in the preceding paragraph that would not appear as a
liability on the balance sheet of such Person if:
(1) such Indebtedness is the obligation of a partnership
or joint venture that is not a Restricted Subsidiary (a "Joint
Venture");
16
(2) such Person or a Restricted Subsidiary of such Person
is a general partner of the Joint Venture (a "General Partner"); and
(3) there is recourse, by contract or operation of law,
with respect to the payment of such Indebtedness to property or assets
of such Person or a Restricted Subsidiary of such Person; and then such
Indebtedness shall be included in an amount not to exceed:
(a) the lesser of (i) the net assets of the
General Partner and (ii) the amount of such obligations to the
extent that there is recourse, by contract or operation of
law, to the property or assets of such Person or a Restricted
Subsidiary of such Person; or
(b) if less than the amount determined pursuant
to clause (a) immediately above, the actual amount of such
Indebtedness that is recourse to such Person or a Restricted
Subsidiary of such Person, if the Indebtedness is evidenced by
a writing and is for a determinable amount and the related
interest expense shall be included in Consolidated Interest
Expense to the extent actually paid by the Company or its
Restricted Subsidiaries.
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Initial Securities" has the meaning ascribed to it in the
second introductory paragraph of this Indenture.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the form
of any direct or indirect advance, loan (other than advances or extensions of
credit to customers in the ordinary course of business) or other extensions of
credit (including by way of Guarantee or similar arrangement, but excluding any
debt or extension of credit represented by a bank deposit other than a time
deposit) or capital contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others), or any purchase or acquisition of Capital Stock, Indebtedness or
other similar instruments issued by, such Person and all other items that are or
would be classified as investments on a balance sheet prepared in accordance
with GAAP; provided that none of the following will be deemed to be an
Investment:
(1) Hedging Obligations entered into in the ordinary
course of business and in compliance with this Indenture;
17
(2) endorsements of negotiable instruments and documents
in the ordinary course of business; and
(3) an acquisition of assets, Capital Stock or other
securities by the Company or a Subsidiary for consideration to the
extent such consideration consists of Common Stock or Preferred Stock
(other than Disqualified Stock) of the Company.
For purposes of Section 3.5 of this Indenture,
(1) "Investment" will include the portion (proportionate
to the Company's equity interest in a Restricted Subsidiary to be
designated as an Unrestricted Subsidiary) of the fair market value of
the net assets of such Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary;
provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company will be deemed to continue to have a
permanent "Investment" in an Unrestricted Subsidiary in an amount (if
positive) equal to (a) the Company's "Investment" in such Subsidiary at
the time of such redesignation less (b) the portion (proportionate to
the Company's equity interest in such Subsidiary) of the fair market
value of the net assets (as conclusively determined by the Board of
Directors of the Company in good faith) of such Subsidiary at the time
that such Subsidiary is so re-designated a Restricted Subsidiary; and
(2) any property transferred to or from an Unrestricted
Subsidiary will be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of
Directors of the Company.
"Issue Date" means the date on which the Initial Securities
are originally issued.
"Legal Holiday" has the meaning ascribed to it in Section 13.8
of this Indenture.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).
"Net Available Cash" from an Asset Disposition means cash
payments received (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and net proceeds from the sale or other disposition of any securities received
as consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to the properties or assets that are
the subject of such Asset Disposition or received in any other non-cash form)
therefrom, in each case net of:
(1) all legal, accounting, investment banking, title and
recording tax expenses, commissions and other fees and expenses
Incurred, and all Federal, state, provincial, foreign and local taxes
required to be paid or accrued as a liability under GAAP (after taking
into account any tax credits or deductions and any tax sharing
agreements
18
available as a direct result of such Asset Disposition), as a
consequence of such Asset Disposition;
(2) all payments made on any Indebtedness which is
secured by any assets subject to such Asset Disposition, in accordance
with the terms of any Lien upon such assets, or which must by its
terms, or in order to obtain a necessary consent to such Asset
Disposition, or by applicable law be repaid out of the proceeds from
such Asset Disposition;
(3) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or joint ventures as
a result of such Asset Disposition; and
(4) the deduction of appropriate amounts to be provided
by the seller as a reserve, in accordance with GAAP, against any
liabilities associated with the assets disposed of in such Asset
Disposition and retained by the Company or any Restricted Subsidiary
after such Asset Disposition (including, but not limited to, those in
respect of indemnification obligations).
provided, however, that any amounts deposited into escrow or otherwise held back
shall not be deemed to be Net Available Cash unless and until such amounts are
released to the Company or a Restricted Subsidiary without restriction.
"Net Cash Proceeds," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
listing fees, discounts or commissions and brokerage, consultant and other fees
and charges actually Incurred in connection with such issuance or sale and net
of taxes paid or payable as a result of such issuance or sale (after taking into
account any available tax credit or deductions and any tax sharing
arrangements).
"New Holdings" means NBC Holdings Corp., a Delaware
corporation.
"Non U.S. Person" means a person who is not a U.S. person, as
described in Regulation S.
"Note Register" means the register of Securities, maintained
by the Trustee, pursuant to Section 2.3.
"Obligations" has the meaning ascribed to it in Section 11.1.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President, the
Treasurer or the Secretary of the Company. Officer of any Subsidiary Guarantor
has a correlative meaning.
"Officers' Certificate" means a certificate signed by two
Officers or by an Officer and either an Assistant Treasurer or an Assistant
Secretary of the Company.
19
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Pari Passu Indebtedness" means Indebtedness that ranks
equally in right of payment to the Securities.
"Permitted Holders" means each of (i) Weston Presidio Capital
III, L.P., Weston Presidio Capital IV, L.P., WPC Entrepreneur Fund II, L.P. and
WPC Entrepreneur Fund II, L.P. (collectively, the "WP Funds") and any of their
respective Affiliates or limited partners, to the extent such limited partners
received Capital Stock of Holdings or New Holdings in a general distribution by
a WP Fund of such Capital Stock to its limited partners; (ii) any officer or
other member of management or employee employed by Holdings or any Subsidiary as
of the date of this Indenture; (iii) family members or relatives of the persons
described in clause (ii); and (iv) in the event of the incompetence or death of
any of the persons described in clauses (ii), such person's estate, executor,
administrator, committee or other personal representatives or beneficiaries.
"Permitted Investment" means an Investment by the Company or
any Restricted Subsidiary in:
(1) a Restricted Subsidiary or a Person which will, upon
the making of such Investment, become a Restricted Subsidiary;
provided, however, that the primary business of such Restricted
Subsidiary is a Related Business;
(2) another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or
conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary; provided, however, that such Person's primary
business is a Related Business;
(3) cash and Cash Equivalents;
(4) receivables owing to the Company or any Restricted
Subsidiary created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary
trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(5) payroll, travel and similar advances to cover matters
that are expected at the time of such advances ultimately to be treated
as expenses for accounting purposes and that are made in the ordinary
course of business;
(6) loans or advances to employees (other than executive
officers) made in the ordinary course of business consistent with past
practices of the Company or such Restricted Subsidiary;
20
(7) Capital Stock, obligations or securities received in
settlement of debts created in the ordinary course of business and
owing to the Company or any Restricted Subsidiary or in satisfaction of
judgments or pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of a debtor;
(8) Investments made as a result of the receipt of
non-cash consideration from an Asset Disposition that was made pursuant
to and in compliance with Section 3.7 of this Indenture;
(9) Investments in existence on the Issue Date;
(10) Interest Rate Agreements and related Hedging
Obligations, which transactions or obligations are Incurred in
compliance with Section 3.3 of this Indenture;
(11) Investments by the Company or any of its Restricted
Subsidiaries, together with all other Investments pursuant to this
clause (11), in an aggregate amount at the time of such Investment not
to exceed $5.0 million outstanding at any one time (with the fair
market value of such Investment being measured at the time made and
without giving effect to subsequent changes in value); and
(12) Guarantees issued in accordance with Section 3.3 of
this Indenture.
"Permitted Liens" means, with respect to any Person:
(1) Liens securing Indebtedness and other obligations
under the Credit Agreement and Hedging Obligations with any of the
banks and other financial institutions or entities party to the Credit
Agreement and Liens securing other Senior Indebtedness and Liens on
assets of Restricted Subsidiaries securing Guarantees of Indebtedness
and other obligations under other Guarantor Senior Indebtedness
permitted to be Incurred under this Indenture;
(2) pledges or deposits by such Person under workmen's
compensation laws, unemployment insurance laws or similar legislation,
or good faith deposits in connection with bids, tenders, contracts
(other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory
obligations of such Person or deposits of cash or United States
government bonds to secure surety or appeal bonds to which such Person
is a party, or deposits as security for contested taxes or import or
customs duties or for the payment of rent, in each case Incurred in the
ordinary course of business;
(3) Liens imposed by law, including carriers',
warehousemen's and mechanics' Liens, in each case for sums not yet due
or being contested in good faith by appropriate proceedings if a
reserve or other appropriate provisions, if any, as shall be required
by GAAP shall have been made in respect thereof;
(4) Liens for taxes, assessments or other governmental
charges not yet subject to penalties for non-payment or which are being
contested in good faith by appropriate
21
proceedings provided appropriate reserves required pursuant to GAAP
have been made in respect thereof;
(5) Liens in favor of issuers of surety or performance
bonds or letters of credit or bankers' acceptances issued pursuant to
the request of and for the account of such Person in the ordinary
course of its business; provided, however, that such letters of credit
do not constitute Indebtedness;
(6) encumbrances, ground leases, easements or
reservations of, or rights of others for, licenses, rights of way,
sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning, building codes or other restrictions (including,
without limitation, minor defects or irregularities in title and
similar encumbrances) as to the use of real properties or liens
incidental to the conduct of the business of such Person or to the
ownership of its properties which do not in the aggregate materially
adversely affect the value of said properties or materially impair
their use in the operation of the business of such Person;
(7) Liens securing Hedging Obligations so long as the
related Indebtedness is, and is permitted to be under this Indenture,
secured by a Lien on the same property securing such Hedging
Obligation;
(8) leases, licenses, subleases and sublicenses of assets
(including, without limitation, real property and intellectual property
rights) which do not materially interfere with the ordinary conduct of
the business of the Company or any of its Restricted Subsidiaries;
(9) judgment Liens not giving rise to an Event of Default
so long as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such
judgment have not been finally terminated or the period within which
such proceedings may be initiated has not expired;
(10) Liens for the purpose of securing the payment of all
or a part of the purchase price of, or Capitalized Lease Obligations,
purchase money obligations or other payments Incurred to finance the
acquisition, improvement or construction of, assets or property
acquired or constructed in the ordinary course of business; provided
that:
(a) the aggregate principal amount of
Indebtedness secured by such Liens is otherwise permitted to
be Incurred under this Indenture and does not exceed the cost
of the assets or property so acquired or constructed; and
(b) such Liens are created within 180 days of
construction or acquisition of such assets or property and do
not encumber any other assets or property of the Company or
any Restricted Subsidiary other than such assets or property
and assets affixed or appurtenant thereto;
22
(11) Liens arising solely by virtue of any statutory or
common law provisions relating to banker's Liens, rights of set-off or
similar rights and remedies as to deposit accounts or other funds
maintained with a depositary institution; provided that:
(a) such deposit account is not a dedicated cash
collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by
regulations promulgated by the Federal Reserve Board; and
(b) such deposit account is not intended by the
Company or any Restricted Subsidiary to provide collateral to
the depository institution;
(12) Liens arising from Uniform Commercial Code financing
statement filings regarding operating leases entered into by the
Company and its Restricted Subsidiaries in the ordinary course of
business;
(13) Liens existing on the Issue Date;
(14) Liens on property or shares of stock of a Person at
the time such Person becomes a Restricted Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in
connection with, or in contemplation of, such other Person becoming a
Restricted Subsidiary; provided further, however, that any such Lien
may not extend to any other property owned by the Company or any
Restricted Subsidiary;
(15) Liens on property at the time the Company or a
Restricted Subsidiary acquired the property, including any acquisition
by means of a merger or consolidation with or into the Company or any
Restricted Subsidiary; provided, however, that such Liens are not
created, Incurred or assumed in connection with, or in contemplation
of, such acquisition; provided further, however, that such Liens may
not extend to any other property owned by the Company or any Restricted
Subsidiary;
(16) Liens securing Indebtedness or other obligations of a
Restricted Subsidiary owing to the Company or a Restricted Subsidiary;
(17) Liens securing the Securities and Subsidiary
Guarantees; and
(18) Liens securing Refinancing Indebtedness Incurred to
refinance Indebtedness that was previously so secured, provided that
any such Lien is limited to all or part of the same property or assets
(plus improvements, accessions, proceeds or dividends or distributions
in respect thereof) that secured (or, under the written arrangements
under which the original Lien arose, could secure) the Indebtedness
being refinanced or is in respect of property that is the security for
a Permitted Lien hereunder.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company, government or any agency or political subdivision
hereof or any other entity.
23
"Preferred Stock," as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"QIB" means any "qualified institutional buyer" (as defined in
Rule 144A under the Securities Act).
"Refinancing Indebtedness" means Indebtedness that is Incurred
to refund, refinance, replace, exchange, renew, repay or extend (including
pursuant to any defeasance or discharge mechanism) (collectively, "refinance,"
"refinances," and "refinanced" shall have a correlative meaning) any
Indebtedness existing on the date of this Indenture or Incurred in compliance
with this Indenture (including Indebtedness of the Company that refinances
Indebtedness of any Restricted Subsidiary and Indebtedness of any Restricted
Subsidiary that refinances Indebtedness of another Restricted Subsidiary)
including Indebtedness that refinances Refinancing Indebtedness, provided,
however, that:
(1) (a) if the Stated Maturity of the Indebtedness being
refinanced is earlier than the Stated Maturity of the Securities, the
Refinancing Indebtedness has a Stated Maturity no earlier than the
Stated Maturity of the Indebtedness being refinanced or (b) if the
Stated Maturity of the Indebtedness being refinanced is later than the
Stated Maturity of the Securities, the Refinancing Indebtedness has a
Stated Maturity later than the Stated Maturity of the Securities;
(2) the Refinancing Indebtedness has an Average Life at
the time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being refinanced;
(3) such Refinancing Indebtedness is Incurred in an
aggregate principal amount (or if issued with original issue discount,
an aggregate issue price) that is equal to or less than the sum of the
aggregate principal amount (or if issued with original issue discount,
the aggregate accreted value) then outstanding of the Indebtedness
being refinanced (plus, without duplication, any additional
Indebtedness Incurred to pay interest or premiums required by the
instruments governing such existing Indebtedness and fees Incurred in
connection therewith); and
(4) if the Indebtedness being refinanced is subordinated
in right of payment to the Securities or the Subsidiary Guarantee, such
Refinancing Indebtedness is subordinated in right of payment to the
Securities or the Subsidiary Guarantee on terms at least as favorable
to the Holders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Registered Exchange Offer" shall have the meaning set forth
in the Registration Rights Agreement.
24
"Registration Rights Agreement" means that certain
registration rights agreement dated as of the date of this Indenture by and
among the Company, the Subsidiary Guarantors and the initial purchasers set
forth therein, and with respect to any Additional Securities, one or more
substantially similar registration rights agreements among the Company and the
other parties thereto, as such agreement(s) may be amended, from to time.
"Related Business" means any business which is the same as or
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the Issue Date.
"Representative" means any trustee, agent or representative
(if any) of an issue of Senior Indebtedness.
"Restricted Investment" means any Investment other than a
Permitted Investment.
"Restricted Period" means the 40 consecutive days beginning on
and including the later of (A) the day on which the Initial Securities are
offered to persons other than distributors (as defined in Regulation S under the
Securities Act) and (B) the Issue Date or the date on which any Additional
Securities are originally issued in the form of Initial Securities as the case
may be.
"Restricted Securities Legend" means the Private Placement
Legend set forth in clause (A) of Section 2.1(c) or the Regulation S Legend set
forth in clause (B) of Section 2.1(c), as applicable.
"Restricted Subsidiary" means any Subsidiary of the Company
other than an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired whereby the Company or a Restricted
Subsidiary transfers such property to a Person and the Company or a Restricted
Subsidiary leases it from such Person.
"SEC" means the United States Securities and Exchange
Commission.
"Securities" means the collective reference to the Initial
Securities, Additional Securities and Exchange Securities.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the custodian with respect to the
Global Security (as appointed by the Depositary), or any successor Person
thereto and shall initially be the Trustee.
"Senior Indebtedness" means, whether outstanding on the Issue
Date or thereafter issued, created, Incurred or assumed, the Indebtedness under
the Credit Agreement and all amounts payable by the Company under or in respect
of all other Indebtedness of the Company, including premiums and accrued and
unpaid interest (including interest accruing on or after the
25
filing of any petition in bankruptcy or for reorganization relating to the
Company at the rate specified in the documentation with respect thereto whether
or not a claim for post filing interest is allowed in such proceeding) and fees
and other amounts relating thereto; provided, however, that Senior Indebtedness
will not include:
(1) any Indebtedness Incurred in violation of this
Indenture;
(2) any obligation of the Company to any Subsidiary;
(3) any liability for Federal, state, foreign, local or
other taxes owed or owing by the Company;
(4) any accounts payable or other liability to trade
creditors arising in the ordinary course of business (including
Guarantees thereof or instruments evidencing such liabilities);
(5) any Indebtedness, Guarantee or obligation of the
Company that is expressly subordinate or junior in right of payment to
any other Indebtedness, Guarantee or obligation of the Company,
including, without limitation, any Senior Subordinated Indebtedness and
any Subordinated Obligations; or
(6) any Capital Stock.
"Senior Subordinated Indebtedness" means the Securities and
any other Pari Passu Indebtedness of the Company that is not subordinated by its
terms in right of payment to any Indebtedness or other obligation of the Company
which is not Senior Indebtedness.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Company within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision, but shall not include any contingent obligations
to repay, redeem or repurchase any such principal prior to the date originally
scheduled for the payment thereof.
"Subordinated Obligation" means any Indebtedness of the
Company (whether outstanding on the Issue Date or thereafter Incurred) which is
subordinate or junior in right of payment to the Securities pursuant to a
written agreement.
"Subsidiary" of any Person means (a) any corporation,
association or other business entity (other than a partnership, joint venture,
limited liability company or similar entity) of which more than 50% of the total
ordinary voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof (or persons performing similar functions) or (b) any
partnership, joint venture, limited liability company or similar entity of which
more than 50% of the capital
26
accounts, distribution rights, total equity and voting interests or general or
limited partnership interests, as applicable, is, in the case of clauses (a) and
(b), at the time owned or controlled, directly or indirectly, by (1) such
Person, (2) such Person and one or more Subsidiaries of such Person or (3) one
or more Subsidiaries of such Person. Unless otherwise specified herein, each
reference to a Subsidiary will refer to a Subsidiary of the Company.
"Subsidiary Guarantee" means, individually, any Guarantee of
payment of the Securities and exchange notes issued in a registered exchange
offer pursuant to the Registration Rights Agreement by a Subsidiary Guarantor
pursuant to the terms of this Indenture and any supplemental indenture thereto,
and, collectively, all such Guarantees. Each such Subsidiary Guarantee will be
in the form prescribed by this Indenture.
"Subsidiary Guarantor" means each Restricted Subsidiary of the
Company that has guaranteed Indebtedness under the Credit Agreement on the Issue
Date and any other Subsidiary that in the future guarantees Indebtedness under
the Credit Agreement and executes a Subsidiary Guarantee in accordance with the
provisions of this Indenture, but excluding any Subsidiary that in the future is
released from a guarantee of Indebtedness under the Credit Agreement (regardless
of whether that guarantee exists on the Issue Date).
"TIA" or "Trust Indenture Act" means the Trust Indenture Act
of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as in effect on the date of this
Indenture.
"Transaction" shall have the meaning set forth in the Offering
Memorandum, dated February 27, 2004, relating to the Securities.
"Trustee" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the successor.
"Trust Officer" means the Chairman of the Board, the President
or any other officer or assistant officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Company that at the time of
determination shall be designated an Unrestricted Subsidiary by the
Board of Directors of the Company in the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors of the Company may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary or a Person becoming a Subsidiary through merger or consolidation or
Investment therein) to be an Unrestricted Subsidiary only if:
(1) such Subsidiary or any of its Subsidiaries does not
own any Capital Stock or Indebtedness of or have any Investment in, or
own or hold any Lien on any property
27
of, any other Subsidiary of the Company which is not a Subsidiary of
the Subsidiary to be so designated or otherwise an Unrestricted
Subsidiary;
(2) such designation and the Investment of the Company in
such Subsidiary complies with Section 3.5 of this Indenture;
(3) such Subsidiary, either alone or in the aggregate
with all other Unrestricted Subsidiaries, does not operate, directly or
indirectly, all or substantially all of the business of the Company and
its Subsidiaries;
(4) such Subsidiary is a Person with respect to which
neither the Company nor any of its Restricted Subsidiaries has any
direct or indirect obligation:
(a) to subscribe for additional Capital Stock of
such Person; or
(b) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any
specified levels of operating results; and
(5) on the date such Subsidiary is designated an
Unrestricted Subsidiary, such Subsidiary is not a party to any
agreement, contract, arrangement or understanding with the Company or
any Restricted Subsidiary with terms substantially less favorable to
the Company than those that might have been obtained from Persons who
are not Affiliates of the Company.
Any such designation by the Board of Directors of the Company
shall be evidenced to the Trustee by filing with the Trustee a resolution of the
Board of Directors of the Company giving effect to such designation and an
Officers' Certificate certifying that such designation complies with the
foregoing conditions. If, at any time, any Unrestricted Subsidiary would fail to
meet the foregoing requirements as an Unrestricted Subsidiary, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture
and any Indebtedness of such Subsidiary shall be deemed to be Incurred as of
such date.
The Board of Directors of the Company may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that immediately
after giving effect to such designation, no Default or Event of Default shall
have occurred and be continuing or would occur as a consequence thereof and the
Company could Incur at least $1.00 of additional Indebtedness under Section
3.3(a) of this Indenture on a pro forma basis taking into account such
designation.
"U.S. Government Obligations" means securities that are (a)
direct obligations of the United States of America for the timely payment of
which its full faith and credit is pledged or (b) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation of the United States of
America, which, in either case, are not callable or redeemable at the option of
the issuer thereof, and shall also include a depositary receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act), as
28
custodian with respect to any such U.S. Government Obligations or a specific
payment of principal of or interest on any such U.S. Government Obligations held
by such custodian for the account of the holder of such depositary receipt;
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the U.S.
Government Obligations or the specific payment of principal of or interest on
the U.S. Government Obligations evidenced by such depositary receipt.
"Voting Stock" of a corporation means all classes of Capital
Stock of such corporation then outstanding and normally entitled to vote in the
election of directors.
"Wholly-Owned Subsidiary" means a Restricted Subsidiary, all
of the Capital Stock of which (other than directors' qualifying shares) is owned
by the Company or another Wholly-Owned Subsidiary.
SECTION 1.2. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction" .................................................... 3.8
"Agent Member" ............................................................. 2.1(d)
"Asset Disposition Offer" .................................................. 3.7(b)
"Asset Disposition Offer Amount" ........................................... 3.7(c)
"Asset Disposition Offer Period" ........................................... 3.7(c)
"Asset Disposition Purchase Date" .......................................... 3.7(c)
"Authenticating Agent" ..................................................... 2.2
"Bankruptcy Law" ........................................................... 6.1
"Blockage Notice" .......................................................... 10.3
"Change of Control Offer" .................................................. 3.9
"Change of Control Payment" ................................................ 3.9
"Change of Control Payment Date" ........................................... 3.9
"Company Order" ............................................................ 2.2
"covenant defeasance option" ............................................... 8.1(b)
"cross acceleration provision" ............................................. 6.1
"Custodian" ................................................................ 6.1
"Definitive Securities" .................................................... 2.1(e)
"Event of Default" ......................................................... 6.1
"Excess Proceeds" .......................................................... 3.6(b)
"Exchange Global Note" ..................................................... 2.1
"Global Securities" ........................................................ 2.1(a)
"IAI" ...................................................................... 2.1(a)
"Institutional Accredited Investor Global Note" ............................ 2.1
"Institutional Accredited Investor Note" ................................... 2.1
"legal defeasance option" .................................................. 8.1(b)
"Notice of Default" ........................................................ 6.1
"Offer" .................................................................... 3.7
29
Defined in
Term Section
---- -------
"Offer Amount" ............................................................. 3.7
"Offer Period" ............................................................. 3.7
"Offer Proceeds" ........................................................... 3.7
"Pari Passu Notes" ......................................................... 3.6(b)
"pay the Securities" ....................................................... 10.3
"Paying Agent" ............................................................. 2.3
"Payment Blockage Period" .................................................. 10.3
"Payment Default" .......................................................... 6.1
"Private Placement Legend" ................................................. 2.1(c)
"Purchase Date" ............................................................ 3.7
"Registrar" ................................................................ 2.3
"Regulation S" ............................................................. 2.1
"Regulation S Certificate" ................................................. 2.1
"Regulation S Global Note" ................................................. 2.1
"Regulation S Legend" ...................................................... 2.1
"Regulation S Note" ........................................................ 2.1
"Regulation S Permanent Global Note" ....................................... 2.1
"Regulation S Temporary Global Note" ....................................... 2.1
"Release Date" ............................................................. 2.1
"Resale Restriction Termination Date" ...................................... 2.6
"Restricted Payment" ....................................................... 3.5
"Rule 144A" ................................................................ 2.1
"Rule 144A Global Note" .................................................... 2.1
"Rule 144A Note" ........................................................... 2.1
"Special Interest Payment Date" ............................................ 2.13
"Special Record Date" ...................................................... 2.13
"Successor Company" ........................................................ 4.1
SECTION 1.3. Incorporation by Reference of Trust Indenture
Act. This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company and
any other obligor on the indenture securities.
30
All other TIA terms used in this Indenture that are defined by
the TIA, defined by the TIA reference to another statute or defined by SEC rule
have the meanings assigned to them by such definitions.
SECTION 1.4. Rules of Construction. Unless the context
otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in
the plural include the singular;
(6) unsecured Indebtedness shall not be deemed to be
subordinate or junior to Secured Indebtedness merely by virtue of its
nature as unsecured Indebtedness;
(7) the principal amount of any noninterest bearing or
other discount security at any date shall be the principal amount
thereof that would be shown on a balance sheet of the issuer dated such
date prepared in accordance with GAAP;
(8) the principal amount of any Preferred Stock shall be
(i) the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect
to such Preferred Stock, whichever is greater;
(9) all references to (a) Initial Securities shall refer
also to any Additional Securities issued in the form of Initial
Securities and (b) Exchange Securities shall refer also to any
Additional Securities issued in the form of Exchange Securities, in
each case, pursuant to Section 2.16; and
(10) all references to the date the Securities were
originally issued shall refer to the Issue Date or the date any
Additional Securities were originally issued, as the case may be.
ARTICLE II
The Securities
SECTION 2.1. Form, Dating and Terms. (a) The Initial
Securities are being offered and sold by the Company pursuant to a Purchase
Agreement, dated February 27, 2004, among the Company, the Subsidiary Guarantors
and X.X. Xxxxxx Securities Inc., as representative of the several initial
purchasers listed in Schedule 1 thereto. The Initial Securities will be resold
initially only to (A) qualified institutional buyers (as defined in Rule 144A
under
31
the Securities Act ("Rule 144A")) in reliance on Rule 144A ("QIBs") and (B)
Persons other than U.S. Persons (as defined in Regulation S under the Securities
Act ("Regulation S")) in reliance on Regulation S. Such Initial Securities may
thereafter be transferred to among others, QIBs, purchasers in reliance on
Regulation S and to institutional "accredited investors", as defined in Rule
501(a)(1), (2), (3) and (7) of Regulation D under the Securities Act who are not
QIBs ("IAIs") in accordance with Rule 501 of the Securities Act in accordance
with the procedures described herein.
Initial Securities offered and sold to QIBs in the United
States of America (the "Rule 144A Note") will be issued on the Issue Date in the
form of a permanent global Security, without interest coupons, substantially in
the form of Exhibit A, which is hereby incorporated by reference and made a part
of this Indenture, together with appropriate legends as set forth in Section
2.1(c) (the "Rule 144A Global Note"), deposited with the Trustee, as custodian
for the Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The Rule 144A Global Note may be represented by
more than one certificate, if so required by the Depositary's rules regarding
the maximum principal amount to be represented by a single certificate. The
aggregate principal amount of the Rule 144A Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Initial Securities offered and sold outside the United States
of America ("Regulation S Note") in reliance on Regulation S will be issued on
the Issue Date in the form of a temporary global Security, without interest
coupons, substantially in the form set forth in Exhibits A and B, which are
hereby incorporated by reference and made a part of this Indenture, together
with appropriate legends as set forth in Section 2.1(c) (a "Regulation S
Temporary Global Note"). Beneficial interests in a Regulation S Temporary Global
Note will be exchangeable for beneficial interests in a single permanent global
security (the "Regulation S Permanent Global Note", together with the Regulation
S Temporary Global Note, the "Regulation S Global Note") on or after the
expiration of the Restricted Period (the "Release Date") upon the receipt by the
Trustee or its agent of a certificate certifying that the Holder of the
beneficial interest in the Regulation S Temporary Global Note is a non-United
States Person within the meaning of Regulation S (a "Regulation S Certificate"),
substantially in the form set forth in Section 2.8. Upon receipt by the Trustee
or Paying Agent of a Regulation S Certificate, (i) with respect to the first
such Regulation S Certificate, the Company shall execute and upon receipt of a
Company Order for authentication, the Authenticating Agent (as defined in
Section 2.2) shall authenticate and deliver to the custodian, the applicable
Regulation S Permanent Global Note and (ii) with respect to the first and all
subsequent Regulation S Certificates, the custodian shall exchange on behalf of
the applicable beneficial owners the portion of the applicable Regulation S
Temporary Global Note covered by such Regulation S Certificates for a comparable
portion of the applicable Regulation S Permanent Global Note. Upon any exchange
of a portion of a Regulation S Temporary Global Note for a comparable portion of
a Regulation S Permanent Global Note, the custodian shall endorse on the
schedules affixed to each of such Regulation S Global Note (or on continuations
of such schedules affixed to each of such Regulation S Global Note and made
parts thereof) appropriate notations evidencing the date of transfer and (x)
with respect to the applicable Regulation S Temporary Global Note, a decrease
32
in the principal amount thereof equal to the amount covered by the applicable
certification and (y) with respect to the applicable Regulation S Permanent
Global Note, an increase in the principal amount thereof equal to the principal
amount of the decrease in the applicable Regulation S Temporary Global Note
pursuant to clause (x) above. The Regulation S Global Note will be deposited
with the Trustee, as custodian for the Depositary, duly executed by the Company
and authenticated by the Trustee as hereinafter provided. The Regulation S
Global Note may be represented by more than one certificate, if so required by
the Depositary's rules regarding the maximum principal amount to be represented
by a single certificate. The aggregate principal amount of the Regulation S
Global Note may from time to time be increased or decreased by adjustments made
on the records of the Trustee, as custodian for the Depositary or its nominee,
as hereinafter provided.
Initial Securities resold to institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) and (7) under the Securities
Act) in the United States of America (the "Institutional Accredited Investor
Note") will be issued in the form of a permanent global Security substantially
in the form set forth in Exhibit A hereto, which is hereby incorporated by
reference and made a part of this Indenture, together with appropriate legends
as set forth in Section 2.1(c) (the "Institutional Accredited Investor Global
Note") deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The Institutional Accredited Investor Global Note may be represented
by more than one certificate, if so required by the Depositary's rules regarding
the maximum principal amount to be represented by a single certificate. The
aggregate principal amount of the Institutional Accredited Investor Global Note
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depositary or its nominee, as
hereinafter provided.
Exchange Securities exchanged for interests in the Rule 144A
Note, the Regulation S Note and the Institutional Accredited Investor Note will
be issued in the form of a permanent global Security substantially in the form
set forth in Exhibit B hereto, which is hereby incorporated by reference and
made a part of this Indenture, deposited with the Trustee as hereinafter
provided, with the appropriate legend set forth in Section 2.1(c) hereof (the
"Exchange Global Note"). The Exchange Global Note may be represented by more
than one certificate, if so required by the Depositary's rules regarding the
maximum principal amount to be represented by a single certificate.
The Rule 144A Global Note, the Regulation S Global Note, the
Exchange Global Note and the Institutional Accredited Investor Global Note are
sometimes collectively herein referred to as the "Global Securities."
The principal of (and premium, if any) and interest on the
Securities shall be payable at the office or agency of the Company maintained
for such purpose in The City of New York, or at such other office or agency of
the Company as may be maintained for such purpose pursuant to Section 2.3;
provided, however, that, at the option of the Company, each installment of
interest may be paid by (i) check mailed to addresses of the Persons entitled
thereto as such addresses shall appear on the Note Register or (ii) wire
transfer to an account located in the United States maintained by the payee.
Payments in respect to Securities represented by a
33
Global Security (including principal, premium, if any, and interest) will be
made by wire transfer of immediately available funds to the accounts specified
by the Depositary.
The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage, in addition to those set forth on
Exhibit A and Exhibit B and Section 2.1(c). The Company and the Trustee shall
approve the forms of the Securities and any notation, endorsement or legend on
them. Each Security shall be dated the date of its authentication. The terms of
the Securities set forth in Exhibit A and Exhibit B are part of the terms of
this Indenture and, to the extent applicable, the Company, the Subsidiary
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to be bound by such terms.
(b) Denominations. The Securities shall be issuable only in
fully registered form, without coupons, and only in denominations of $1,000 and
any integral multiple thereof.
(c) Restrictive Legends. Unless and until (i) an Initial
Security is sold under an effective registration statement or (ii) an Initial
Security is exchanged for an Exchange Security in connection with an effective
registration statement, in each case pursuant to the Registration Rights
Agreement or a similar agreement,
(A) such Rule 144A Global Note and the Institutional
Accredited Investor Global Note shall bear the following legend (the "Private
Placement Legend") on the face thereof:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR
TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO
YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST
DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER
OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE
COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT
34
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT
OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL ACCREDITED INVESTOR
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH
A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE."; and
(B) the Regulation S Global Note shall bear the following
legend (the "Regulation S Legend") on the face thereof:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS NOT A
U.S. PERSON NOR IS IT PURCHASING FOR THE ACCOUNT OF A U.S. PERSON AND
IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH REGULATION S UNDER THE SECURITIES ACT ("REGULATION S"), (2) BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE")
WHICH IS FORTY DAYS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY),
ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG
AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER
THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE
35
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT
TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S, (E) TO AN INSTITUTIONAL ACCREDITED INVESTOR
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND IN THE CASE OF THE
FOREGOING CLAUSE (E), A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE COMPANY AND THE TRUSTEE. THIS LEGEND WILL BE REMOVED
AFTER 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A)
THE DAY ON WHICH THE SECURITIES ARE OFFERED TO PERSONS OTHER THAN
DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE DATE OF THE
CLOSING OF THE ORIGINAL OFFERING. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION", "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN
TO THEM BY REGULATION S UNDER THE SECURITIES ACT."
(C) The Global Securities, whether or not an Initial Security,
shall bear the following legend on the face thereof:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW
YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
36
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE
HEREOF.":
(D) The Regulation S Temporary Global Note shall also bear the
following legend on the face thereof:
THIS GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES OF REGULATION
S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933
ACT"). NEITHER THIS TEMPORARY GLOBAL NOTE NOR ANY INTEREST HEREIN MAY
BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER THE INDENTURE
REFERRED TO BELOW.
NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO
RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED
CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO THE TERMS OF THE
INDENTURE.
(d) Book-Entry Provisions. (i) This Section 2.1(d) shall apply
only to Global Securities deposited with the Trustee, as custodian for the
Depositary.
(ii) Each Global Security initially shall (x) be
registered in the name of the Depositary for such Global Security or the nominee
of such Depositary, (y) be delivered to the Trustee as custodian for such
Depositary and (z) bear legends as set forth in Section 2.1(c).
(iii) Members of, or participants in, the Depositary
("Agent Members") shall have no rights under this Indenture with respect to any
Global Security held on their behalf by the Depositary or by the Trustee as the
custodian of the Depositary or under such Global Security, and the Depositary
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 all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of the Depositary governing the exercise of the
rights of a Holder of a beneficial interest in any Global Security.
(iv) In connection with any transfer of a portion of the
beneficial interest in a Global Security pursuant to Section 2.1(e) to
beneficial owners who are required to hold Definitive Securities, the Security
Trustee shall reflect on its books and records the date and a decrease in the
principal amount of such Global Security in an amount equal to the principal
37
amount of the beneficial interest in the Global Security to be transferred, and
the Company shall execute, and the Trustee shall authenticate and deliver, one
or more Definitive Securities of like tenor and amount.
(v) In connection with the transfer of an entire Global
Security to beneficial owners pursuant to Section 2.1(e), such Global Security
shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall authenticate and deliver, to each
beneficial owner identified by the Depositary in exchange for its beneficial
interest in such Global Security, an equal aggregate principal amount of
Definitive Securities of authorized denominations.
(vi) The registered Holder of a Global Security may grant
proxies and otherwise authorize any person, including Agent Members and persons
that may hold interests through Agent Members, to take any action which a Holder
is entitled to take under this Indenture or the Securities.
(vii) Any Holder of a Global Security shall, by acceptance
of such Global Security, agree that transfers of beneficial interests in such
Global Security may be effected only through a book-entry system maintained by
(a) the Holder of such Global Security (or its agent) or (b) any Holder of a
beneficial interest in such Global Security, and that ownership of a beneficial
interest in such Global Security shall be required to be reflected in a book
entry.
(e) Definitive Securities. Except as provided below, owners of
beneficial interests in Global Securities will not be entitled to receive
certificated Securities ("Definitive Securities"). If required to do so pursuant
to any applicable law or regulation, beneficial owners may obtain Definitive
Securities in exchange for their beneficial interests in a Global Security upon
written request in accordance with the Depositary's and the Registrar's
procedures. In addition, Definitive Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in a Global
Security if (i) the Depositary notifies the Company that it is unwilling or
unable to continue as depositary for such Global Security or the Depositary
ceases to be a clearing agency registered under the Exchange Act, at a time when
the Depositary is required to be so registered in order to act as depositary,
and in each case a successor depositary is not appointed by the Company within
90 days of such notice or, (ii) the Company executes and delivers to the Trustee
and Registrar an Officers' Certificate stating that such Global Security shall
be so exchangeable or (iii) an Event of Default has occurred and is continuing
and the Registrar has received a request from the Depositary.
(f) Any Definitive Security delivered in exchange for an
interest in a Global Security pursuant to Section 2.1(d)(iv) or (v) shall,
except as otherwise provided by Section 2.6(c), bear the applicable legend
regarding transfer restrictions applicable to the Definitive Security set forth
in Section 2.1(c).
(g) In connection with the exchange of a portion of a
Definitive Security for a beneficial interest in a Global Security, the Trustee
shall cancel such Definitive Security, and the
38
Company shall execute, and the Trustee shall authenticate and deliver, to the
transferring Holder a new Definitive Security representing the principal amount
not so transferred.
SECTION 2.2. Execution and Authentication. One Officer shall
sign the Securities for the Company by manual or facsimile signature. If an
Officer whose signature is on a Security no longer holds that office at the time
the Trustee authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be valid until an authorized signatory of
the Trustee manually authenticates the Security. The signature of the Trustee on
a Security shall be conclusive evidence that such Security has been duly and
validly authenticated and issued under this Indenture. A Security shall be dated
the date of its authentication.
At any time and from time to time after the execution and
delivery of this Indenture, the Trustee shall authenticate and make available
for delivery: (1) Initial Securities for original issue on the Issue Date in an
aggregate principal amount of $175.0 million, (2) any Additional Securities for
original issue from time to time after the Issue Date in such principal amounts
as set forth in Section 2.16 and (3) Exchange Securities for issue only in a
Registered Exchange Offer pursuant to the Registration Rights Agreement, and
only in exchange for Initial Securities of an equal principal amount, in each
case upon a written order of the Company signed by two Officers or by an Officer
and either an Assistant Treasurer or an Assistant Secretary of the Company (the
"Company Order"). Such Company Order shall specify the amount of the Securities
to be authenticated and the date on which the original issue of Securities is to
be authenticated and whether the Securities are to be Initial Securities or
Exchange Securities. The aggregate principal amount of Initial Securities which
may be authenticated and delivered under this Indenture is limited to $175.0
million outstanding. Additionally, the Company may from time to time, without
notice to or consent of the Holders, issue such additional principal amounts of
Additional Securities as may be issued and authenticated pursuant to clause (2)
of this paragraph, and Securities authenticated and delivered upon registration
or transfer of, or in exchange for, or in lieu of, other Securities of the same
class pursuant to Section 2.6, Section 2.9, Section 2.11, Section 5.8, Section
9.5 and except for transactions similar to the Registered Exchange Offer. All
Securities issued on the Issue Date shall be identical in all respects other
than issue dates, the date from which interest accrues and any changes relating
thereto. Notwithstanding anything to the contrary contained in this Indenture,
all notes issued under this Indenture shall vote and consent together on all
matters as one class and no series of notes will have the right to vote or
consent as a separate class on any matter.
The Trustee may appoint an agent (the "Authenticating Agent")
reasonably acceptable to the Company to authenticate the Securities. Unless
limited by the terms of such appointment, any such Authenticating Agent may
authenticate Securities whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by the
Authenticating Agent.
In case the Company or any Subsidiary Guarantor, pursuant to
Article IV, shall be consolidated or merged with or into any other Person or
shall convey, transfer, lease or otherwise dispose of its properties and assets
substantially as an entirety to any Person, and the successor
39
Person resulting from such consolidation, or surviving such merger, or into
which the Company or any Subsidiary Guarantor shall have been merged, or the
Person which shall have received a conveyance, transfer, lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article IV, any of the Securities authenticated or
delivered prior to such consolidation, merger, conveyance, transfer, lease or
other disposition may, from time to time, at the request of the successor
Person, be exchanged for other Securities executed in the name of the successor
Person with such changes in phraseology and form as may be appropriate, but
otherwise in substance of like tenor as the Securities surrendered for such
exchange and of like principal amount; and the Trustee, upon Company Order of
the successor Person, shall authenticate and deliver Securities as specified in
such order for the purpose of such exchange. If Securities shall at any time be
authenticated and delivered in any new name of a successor Person pursuant to
this Section 2.2 in exchange or substitution for or upon registration of
transfer of any Securities, such successor Person, at the option of the Holders
but without expense to them, shall provide for the exchange of all Securities at
the time outstanding for Securities authenticated and delivered in such new
name.
SECTION 2.3. Registrar and Paying Agent. The Company shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Company shall
cause each of the Registrar and the Paying Agent to maintain an office or agency
in the Borough of Manhattan, The City of New York. The Registrar shall keep a
register of the Securities and of their transfer and exchange (the "Note
Register"). The Company may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes any additional paying
agent.
The Company shall enter into an appropriate agency agreement
with any Registrar, Paying Agent or co-registrar not a party to this Indenture,
which shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of each such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.7. The
Company or any of its Restricted Subsidiaries may act as Paying Agent,
Registrar, co-registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and
Paying Agent for the Securities.
SECTION 2.4. Paying Agent To Hold Money in Trust. By at least
10:00 a.m (New York City time) on the date on which any principal of or interest
on any Security is due and payable, the Company shall deposit with the Paying
Agent a sum sufficient to pay such principal or interest when due. The Company
shall require each Paying Agent (other than the Trustee) to agree in writing
that such Paying Agent shall hold in trust for the benefit of Securityholders or
the Trustee all money held by such Paying Agent for the payment of principal of
or interest on the Securities and shall notify the Trustee of any default by the
Company or any Subsidiary Guarantor in making any such payment, subject to
Articles X and XII. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate the money held by it as Paying
40
Agent and hold it as a separate trust fund. The Company at any time may require
a Paying Agent (other than the Trustee) to pay all money held by it to the
Trustee and to account for any funds disbursed by such Paying Agent. Upon
complying with this Section, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money delivered to the
Trustee. Upon any bankruptcy, reorganization or similar proceeding with respect
to the Company, the Trustee shall serve as Paying Agent for the Securities.
SECTION 2.5. 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, or to the extent otherwise required under the TIA, the Company shall
furnish to the Trustee, in writing at least seven Business Days before each
interest payment date and at such other times as the Trustee may request in
writing, a list in such form and as of such date as the Trustee may reasonably
require of the names and addresses of Securityholders.
SECTION 2.6. Transfer and Exchange.
(a) The following provisions shall apply with respect to any
proposed transfer of a Rule 144A Note or an Institutional Accredited Investor
Note prior to the date which is two years after the later of the date of
original issue and the last date on which the Company or any affiliate of the
Company was the owner of such Securities (or any predecessor thereto) (the
"Resale Restriction Termination Date"):
(i) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a QIB
shall be made upon the representation of the transferee that it is
purchasing the Security for its own account or an account with respect
to which it exercises sole investment discretion and that it and any
such account is a "qualified institutional buyer" within the meaning of
Rule 144A, and is aware that the sale to it is being made in reliance
on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule
144A or has determined not to request such information and that it is
aware that the transferor is relying upon its foregoing representations
in order to claim the exemption from registration provided by Rule
144A;
(ii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to an IAI
shall be made upon receipt by the Trustee or its agent of a certificate
substantially in the form set forth in Section 2.7 hereof from the
proposed transferee and, if requested by the Company or the Trustee,
the delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them; and
(iii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a Non-U.S.
Person shall be made upon receipt by the Trustee or its agent of a
certificate substantially in the form set forth in Section 2.8 hereof
from the proposed transferee and, if requested by the Company or the
Trustee, the
41
delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them.
(b) The following provisions shall apply with respect to any
proposed transfer of a Regulation S Note prior to the expiration of the
Restricted Period:
(i) a transfer of a Regulation S Note or a beneficial
interest therein to a QIB shall be made upon the representation of the
transferee that it is purchasing the Security for its own account or an
account with respect to which it exercises sole investment discretion
and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon
its foregoing representations in order to claim the exemption from
registration provided by Rule 144A;
(ii) a transfer of a Regulation S Note or a beneficial
interest therein to an IAI shall be made upon receipt by the Trustee or
its agent of a certificate substantially in the form set forth in
Section 2.7 hereof from the proposed transferee and, if requested by
the Company or the Trustee, the delivery of an opinion of counsel,
certification and/or other information satisfactory to each of them;
and
(iii) a transfer of a Regulation S Note or a beneficial
interest therein to a Non-U.S. Person shall be made upon receipt by the
Trustee or its agent of a certificate substantially in the form set
forth in Section 2.8 hereof from the proposed transferee and, if
requested by the Company or the Trustee, receipt by the Trustee or its
agent of an opinion of counsel, certification and/or other information
satisfactory to each of them.
Prior to the expiration of the Restricted Period, a
registration of transfer of a Regulation S Note or a beneficial interest therein
shall only be made to a Non-U.S. Person and shall be made upon receipt by the
Trustee or its agent of a certificate substantially in the form set forth in
Section 2.8 hereof from the proposed transferee and, if requested by the
Company, receipt by the Trustee or its agent of an opinion of counsel,
certification and/or other information satisfactory to the Company.
After the expiration of the Restricted Period, interests in
the Regulation S Note may be transferred in accordance with applicable law
without requiring certification set forth in Section 2.8 or any additional
certification.
(c) Restricted Securities Legend. Upon the transfer, exchange
or replacement of Securities not bearing a Restricted Securities Legend, the
Registrar shall deliver Securities that do not bear a Restricted Securities
Legend. Upon the transfer, exchange or replacement of Securities bearing a
Restricted Securities Legend, the Registrar shall deliver only Securities that
bear a Restricted Securities Legend unless there is delivered to the Registrar
an Opinion of
42
Counsel to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act.
(d) The Company shall deliver to the Trustee an Officer's
Certificate setting forth the Resale Restriction Termination Date and the
Restricted Period.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.1 or this Section
2.6. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
(e) Obligations with Respect to Transfers and Exchanges of
Securities.
(i) To permit registrations of transfers and exchanges,
the Company shall, subject to the other terms and conditions of this
Article II, execute and the Trustee shall authenticate Definitive
Securities and Global Securities at the Registrar's or co-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 transfer tax, assessments, or
similar governmental charge payable in connection therewith (other than
any such transfer taxes, assessments or similar governmental charges
payable upon exchange or transfer pursuant to Sections 3.7, 3.9 or
9.5).
(iii) The Registrar or co-registrar shall not be required
to register the transfer of or exchange of any Security for a period
beginning (1) 15 days before the mailing of a notice of an offer to
repurchase or redeem Securities and ending at the close of business on
the day of such mailing or (2) 15 days before an interest payment date
and ending on such interest payment date.
(iv) Prior to the due presentation for registration of
transfer of any Security, the Company, the Trustee, the Paying Agent,
the Registrar or any co-registrar may deem and treat the person in
whose name a Security is registered as the absolute owner of such
Security for the purpose of receiving payment of principal of and
interest on such Security and for all other purposes whatsoever,
whether or not such Security is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-registrar shall be
affected by notice to the contrary.
(v) Any Definitive Security delivered in exchange for an
interest in a Global Security pursuant to Section 2.1(d) shall, except
as otherwise provided by Section 2.6(c), bear the applicable legend
regarding transfer restrictions applicable to the Definitive Security
set forth in Section 2.1(c).
(vi) All Securities issued upon any transfer or exchange
pursuant to the terms of this Indenture shall evidence the same debt
and shall be entitled to the same benefits under this Indenture as the
Securities surrendered upon such transfer or exchange.
43
(f) No Obligation of the Trustee. (i) The Trustee shall have
no responsibility or obligation to any beneficial owner of a Global Security, a
member of, or a participant in, the Depositary or other Person with respect to
the accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest in the
Securities or with respect to the delivery to any participant, member,
beneficial owner or other Person (other than the Depositary) of any notice
(including any notice of redemption) or the payment of any amount or delivery of
any Securities (or other security or property) under or with respect to such
Securities. All notices and communications to be given to the Holders and all
payments to be made to Holders in respect of the Securities shall be given or
made only to or upon the order of the registered Holders (which shall be the
Depositary or its nominee in the case of a Global Security). The rights of
beneficial owners in any Global Security shall be exercised only through the
Depositary subject to the applicable rules and procedures of the Depositary. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depositary with respect to its members, participants and any
beneficial owners.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between or
among Depositary participants, members or beneficial owners in any Global
Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by, the terms of this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
SECTION 2.7. Form of Certificate to be Delivered in Connection
with Transfers to Institutional Accredited Investors.
[Date]
BNY Midwest Trust Company
Xxx Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
Ladies and Gentlemen:
This certificate is delivered to request a transfer of
$________principal amount of the 8-5/8% Senior Subordinated Notes due 2012 (the
"Securities") of Nebraska Book Company, Inc. (the "Company").
Upon transfer, the Securities would be registered in the name
of the new beneficial owner as follows:
Name: __________________________________________
Address: ______________________________________
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Taxpayer ID Number: ________________________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
amended (the "Securities Act")) purchasing for our own account or for the
account of such an institutional "accredited investor" at least $250,000
principal amount of the Securities, and we are acquiring the Securities not with
a view to, or for offer or sale in connection with, any distribution in
violation of the Securities Act. We have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risk of our investment in the Securities and we invest in or purchase securities
similar to the Securities in the normal course of our business. We and any
accounts for which we are acting are each able to bear the economic risk of our
or its investment.
2. We understand that the Securities have not been
registered under the Securities Act and, unless so registered, may not be sold
except as permitted in the following sentence. We agree on our own behalf and on
behalf of any investor account for which we are purchasing Securities to offer,
sell or otherwise transfer such Securities prior to the date which is two years
after the later of the date of original issue and the last date on which the
Company or any affiliate of the Company was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (a) to the
Company, (b) pursuant to a registration statement which has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act, to a person we reasonably
believe is a qualified institutional buyer under Rule 144A (a "QIB") that
purchases for its own account or for the account of a QIB and to whom notice is
given that the transfer is being made in reliance on Rule 144A, (d) pursuant to
offers and sales that occur outside the United States within the meaning of
Regulation S under the Securities Act, (e) to an institutional "accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is purchasing for its own account or for the account of such
an institutional "accredited investor," in each case in a minimum principal
amount of Securities of $250,000 or (f) pursuant to any other available
exemption from the registration requirements of the Securities Act, subject in
each of the foregoing cases to any requirement of law that the disposition of
our property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable state
securities laws. The foregoing restrictions on resale will not apply subsequent
to the Resale Restriction Termination Date. If any resale or other transfer of
the Securities is proposed to be made pursuant to clause (e) above prior to the
Resale Restriction Termination Date, the transferor shall deliver a letter from
the transferee substantially in the form of this letter to the Company and the
Trustee, which shall provide, among other things, that the transferee is an
institutional "accredited investor" (within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act) and that it is acquiring such Securities
for investment purposes and not for distribution in violation of the Securities
Act. Each purchaser acknowledges that the Company and the Trustee reserve the
right prior to any offer, sale or other transfer prior to the Resale Termination
Date of the Securities pursuant to clauses (d), (e) or (f) above to require the
delivery of an opinion of counsel, certifications and/or other information
satisfactory to the Company and the Trustee.
45
TRANSFEREE:_____________________
BY______________________________
SECTION 2.8. Form of Certificate to be Delivered in Connection
with Transfers Pursuant to Regulation S.
[Date]
BNY Midwest Trust Company
Xxx Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
Re: Nebraska Book Company, Inc.
8-5/8% Senior Subordinated Notes due 2012
(the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(a) the offer of the Securities was not made to a person
in the United States;
(b) either (i) at the time the buy order was originated,
the transferee was outside the United States or we and any person
acting on our behalf reasonably believed that the transferee was
outside the United States or (ii) the transaction was executed in, on
or through the facilities of a designated off-shore securities market
and neither we nor any person acting on our behalf knows that the
transaction has been pre-arranged with a buyer in the United States;
(c) no directed selling efforts have been made in the
United States in contravention of the requirements of Rule 903(a)(2) or
Rule 904(a)(2) of Regulation S, as applicable; and
(d) the transaction is not part of a plan or scheme to
evade the registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period
and the provisions of Rule 903(b)(2) or Rule 904(b)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(b)(2) or Rule 904(b)(1), as the case may
be.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or
46
legal proceedings or official inquiry with respect to the matters covered
hereby. Terms used in this certificate have the meanings set forth in Regulation
S.
Very truly yours,
[Name of Transferor]
By:____________________________
_______________________________
Authorized Signature
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities.
If a mutilated Security is surrendered to the Registrar 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 requirements of Section 8-405 of the Uniform Commercial Code are
met and the Holder satisfies any other reasonable requirements of the Trustee.
If required by the Trustee or the Company, such Holder shall furnish an
indemnity bond sufficient in the judgment of the Company and the Trustee to
protect the Company, the Trustee, the Paying Agent, the Registrar and any
co-registrar from any loss which any of them may suffer if a Security is
replaced, then, in the absence of notice to the Company, any Subsidiary
Guarantor or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon Company Order the Trustee shall
authenticate and deliver, in exchange for any such mutilated Security or in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) in connection
therewith.
Every new Security issued pursuant to this Section in lieu of
any mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, any Subsidiary Guarantor (if
applicable) and any other obligor upon the Securities, whether or not the
mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
47
SECTION 2.10. Outstanding Securities. Securities outstanding
at any time are all Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation and those described in
this Section as not outstanding. A Security ceases to be outstanding in the
event the Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.9 (other than
a mutilated Security surrendered for replacement, it ceases to be outstanding
unless the Trustee and the Company receive proof satisfactory to them that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in
accordance with this Indenture, on a redemption date or maturity date money
sufficient to pay all principal and interest payable on that date with respect
to the Securities (or portions thereof) to be redeemed or maturing, as the case
may be, and the Paying Agent is not prohibited from paying such money to the
Securityholders on that date pursuant to the terms of this Indenture, then on
and after that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.11. 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.
After the preparation of Definitive Securities, the temporary Securities shall
be exchangeable for Definitive Securities upon surrender of the temporary
Securities at any office or agency maintained by the Company for that purpose
and such exchange shall be without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute,
and the Trustee shall authenticate and make available for delivery in exchange
therefor, one or more Definitive Securities representing an equal principal
amount of Securities. Until so exchanged, the Holder of temporary Securities
shall in all respects be entitled to the same benefits under this Indenture as a
holder of Definitive Securities.
SECTION 2.12. Cancellation. The Company at any time may
deliver Securities to the Trustee for cancellation. The Registrar and the Paying
Agent shall forward to the Trustee any Securities surrendered to them for
registration of transfer, exchange or payment. The Trustee and no one else shall
cancel and return to the Company all Securities surrendered for registration of
transfer, exchange, payment or cancellation and deliver a certificate of such
destruction to the Company. The Company may not issue new Securities to replace
Securities it has paid or delivered to the Trustee for cancellation.
SECTION 2.13. Payment of Interest; Defaulted Interest.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any interest payment date shall be paid to the Person in whose
name such Security (or one or more predecessor Securities) is registered at the
close of business on the regular record date for such interest at the office or
agency of the Company maintained for such purpose pursuant to Section 2.3.
48
Any interest on any Security which is payable, but is not paid
when the same becomes due and payable and such nonpayment continues for a period
of 30 days shall forthwith cease to be payable to the Holder on the regular
record date by virtue of having been such Holder, and such defaulted interest
and (to the extent lawful) interest on such defaulted interest at the rate borne
by the Securities (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") shall be paid by the Company, at its
election in each case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective predecessor Securities) are registered at the close of
business on a Special Record Date (as defined below) for the payment of
such Defaulted Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security and the date
(not less than 30 days after such notice) of the proposed payment (the
"Special Interest Payment Date"), and at the same time the Company
shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the
Trustee shall fix a record date (the "Special Record Date") for the
payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the Special Interest Payment Date
and not less than 10 days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date, and in the name and at the expense
of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date and Special Interest
Payment Date therefor to be given in the manner provided for in Section
13.2, not less than 10 days prior to such Special Record Date. Notice
of the proposed payment of such Defaulted Interest and the Special
Record Date and Special Interest Payment Date therefor having been so
given, such Defaulted Interest shall be paid on the Special Interest
Payment Date to the Persons in whose names the Securities (or their
respective predecessor Securities) are registered at the close of
business on such Special Record Date and shall no longer be payable
pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment pursuant to this
clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
49
SECTION 2.14. Computation of Interest. Interest on the
Securities shall be computed on the basis of a 360-day year composed of twelve
30-day months.
SECTION 2.15. CUSIP Numbers. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use) and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided, however, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such CUSIP numbers.
SECTION 2.16. Issuance of Additional Securities. The Company
shall be entitled to issue, from time to time, Additional Securities under this
Indenture which shall have identical terms as the Initial Securities issued on
the Issue Date or the Exchange Securities exchanged therefor (in each case,
other than with respect to the date of issuance, issue price and amount of
interest payable on the first payment date applicable thereto), as the case may
be. The Initial Securities issued on the Issue Date, any Additional Securities
and all Exchange Securities issued in exchange therefor shall be treated as a
single class for all purposes under this Indenture.
With respect to any Additional Securities, the Company shall
set forth in a resolution of the Board of Directors and an Officers'
Certificate, a copy of each shall be delivered to the Trustee, the following
information:
(i) the aggregate principal amount of such Additional
Securities to be authenticated and delivered pursuant to this Indenture;
(ii) the issue price, the issue date and the "CUSIP" and
"ISIN" number of any such Additional Securities and the amount of interest
payable on the first payment date applicable thereto;
(iii) whether such Additional Securities shall be transfer
restricted securities and issued in the form of Initial Securities as set forth
in Exhibit A to this Indenture or shall be issued in the form of Exchange
Securities as set forth in Exhibit B to this Indenture; and
(iv) if applicable, the Restricted Period for such Additional
Securities.
ARTICLE III
Covenants
SECTION 3.1. Payment of Securities. The Company shall promptly
pay the principal of and interest on the Securities on the dates and in the
manner provided in the Securities and in this Indenture. Principal and interest
shall be considered paid on the date due if on such date the Trustee or the
Paying Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the
50
case may be, is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the
rate specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
Notwithstanding anything to the contrary contained in this
Indenture, the Company may, to the extent it is required to do so by law, deduct
or withhold income or other similar taxes imposed by the United States of
America from principal or interest payments hereunder.
SECTION 3.2. SEC Reports and Available Information
(a) Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, to the extent
permitted by the Exchange Act, the Company will file with the SEC, and make
available to the Trustee and the registered holders of the Securities, the
annual reports and the information, documents and other reports (or copies of
such portions of any of the foregoing as the SEC may by rules and regulations
prescribe) that are specified in Sections 13 and 15(d) of the Exchange Act
within the time periods specified therein. In the event that the Company is not
permitted to file such reports, documents and information with the SEC pursuant
to the Exchange Act, the Company will nevertheless make available such Exchange
Act information to the Trustee and the holders of the Securities as if the
Company were subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act within the time periods specified therein. The Company shall also
comply with the other provisions of TIA Section 314(a).
(b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries that, alone or taken together, represent 10% or more
of the Consolidated EBITDA of the Company for the most recent four consecutive
fiscal quarters presented in a particular report or other document filed with
the SEC, then the quarterly and annual financial information required by Section
3.2(a) shall include a reasonably detailed presentation, either on the face of
the financial statements or in the footnotes to the financial statements and in
Management's Discussion and Analysis of Results of Operations and Financial
Condition, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries (excluding any such Unrestricted Subsidiaries).
SECTION 3.3. Limitation on Indebtedness. (a) The Company shall
not, and shall not permit any of its Restricted Subsidiaries to, Incur any
Indebtedness (including Acquired Indebtedness); provided, however, that the
Company and the Subsidiary Guarantors may Incur Indebtedness if on the date of
the Incurrence: (1) the Consolidated Coverage Ratio for the Company and its
Restricted Subsidiaries is at least 2.00 to 1.00; and (2) no Default or Event of
Default will have occurred or be continuing or would occur as a consequence of
Incurring the Indebtedness or transactions relating to such Incurrence.
51
(b) Section 3.3(a) will not prohibit the Incurrence of the
following Indebtedness: (1) Indebtedness of the Company Incurred pursuant to the
Credit Agreement and Guarantees of Restricted Subsidiaries in respect of the
Indebtedness Incurred pursuant to a Credit Agreement; provided, however, that
the aggregate principal amount of all Indebtedness Incurred by the Company
pursuant to this Section 3.3(b)(1) does not exceed $250.0 million at any time
outstanding, less the aggregate principal amount of all Net Cash Proceeds from
Asset Dispositions applied to permanently reduce the commitments with respect to
such Indebtedness pursuant to this Section 3.3 described under Section 3.7; (2)
Guarantees by the Subsidiary Guarantors of Indebtedness Incurred in accordance
with this Indenture; provided that in the event such Indebtedness that is being
Guaranteed is (a) Senior Subordinated Indebtedness or Guarantor Senior
Subordinated Indebtedness, then the related Guarantee shall rank equally in
right of payment to the Subsidiary Guarantee or (b) a Subordinated Obligation or
a Guarantor Subordinated Obligation, then the related Guarantee shall be
subordinated in right of payment to the Subsidiary Guarantee; (3) Indebtedness
of the Company owing to and held by any Restricted Subsidiary or Indebtedness of
a Restricted Subsidiary owing to and held by the Company or any other Restricted
Subsidiary; provided, however, (a) if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior payment
in full in cash of all obligations with respect to the Securities; (b) if a
Subsidiary Guarantor is the obligor on such Indebtedness and the Company or a
Subsidiary Guarantor is not the obligee, such Indebtedness is subordinated in
right of payment to the Subsidiary Guarantees of such Subsidiary Guarantor; and
(c) (i) any subsequent issuance or transfer of Capital Stock or any other event
which results in any such Indebtedness being beneficially held by a Person other
than the Company or a Restricted Subsidiary of the Company; and (ii) any sale or
other transfer of any such Indebtedness to a Person other than the Company or a
Restricted Subsidiary of the Company; shall be deemed, in each case, to
constitute the Incurrence of such Indebtedness by the Company or such
Subsidiary, as the case may be; (4) Indebtedness represented by (a) the
Securities issued on the Issue Date, the Subsidiary Guarantees and the exchange
notes and exchange guarantees issued in a registered exchange offer pursuant to
the Registration Rights Agreement, (b) any Indebtedness (other than the
Indebtedness described in clauses (1), (2), (3), (6), (8), (9) and (10) of this
Section 3.3(b)) outstanding on the Issue Date and (c) any Refinancing
Indebtedness Incurred in respect of any Indebtedness described in this Section
3.3(b)(4) or Section 3.3(b)(5) or Incurred pursuant to Section 3.3(a); (5)
Indebtedness of a Restricted Subsidiary Incurred and outstanding on the date on
which such Restricted Subsidiary was acquired by the Company (other than
Indebtedness Incurred (a) to provide all or any portion of the funds utilized to
consummate the transaction or series of related transactions pursuant to which
such Restricted Subsidiary became a Restricted Subsidiary or was otherwise
acquired by the Company or (b) otherwise in connection with, or in contemplation
of, such acquisition); provided, however, that at the time such Restricted
Subsidiary is acquired by the Company, the Company would have been able to Incur
$1.00 of additional Indebtedness pursuant to Section 3.3(a) after giving effect
to the Incurrence of such Indebtedness pursuant to this Section 3.3(b)(5); (6)
Indebtedness under Interest Rate Agreements; provided, that in the case of such
Interest Rate Agreements are entered into for bona fide hedging purposes of the
Company or its Restricted Subsidiaries (as determined in good faith by the Board
of Directors or senior management of the Company) and substantially correspond
in terms of notional amount, duration, currencies and interest rates, as
applicable, to Indebtedness of the Company or its Restricted Subsidiaries
Incurred without violation of this
52
Indenture; (7) the Incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capitalized Lease Obligations,
mortgage financings or purchase money obligations with respect to assets other
than Capital Stock or other Investments, in each case Incurred for the purpose
of financing all or any part of the purchase price or cost of construction or
improvements of property used in the business of the Company or such Restricted
Subsidiary, in an aggregate principal amount not to exceed $10.0 million at any
time outstanding; (8) Indebtedness Incurred in respect of workers' compensation
claims, self-insurance obligations, performance, surety and similar bonds and
completion guarantees provided by the Company or a Restricted Subsidiary in the
ordinary course of business; (9) Indebtedness arising from agreements of the
Company or a Restricted Subsidiary providing for indemnification, adjustment of
purchase price or similar obligations, in each case, Incurred or assumed in
connection with the disposition of any business, assets or Capital Stock of a
Restricted Subsidiary, provided that the maximum aggregate liability in respect
of all such Indebtedness shall at no time exceed the gross proceeds actually
received by the Company and its Restricted Subsidiaries in connection with such
disposition; (10) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument (except in the
case of daylight overdrafts) drawn against insufficient funds in the ordinary
course of business, provided, however, that such Indebtedness is extinguished
within five Business Days of Incurrence; and (11) in addition to the items
referred to in clauses (1) through (10) of this Section 3.3(b), Indebtedness of
the Company and its Restricted Subsidiaries in an aggregate outstanding
principal amount which, when taken together with the principal amount of all
other Indebtedness Incurred pursuant to this Section 3.3(b)(11) and then
outstanding, will not exceed $20.0 million at any time outstanding (which may be
Indebtedness Incurred under or in respect of the Credit Agreement).
(c) The Company will not Incur any Indebtedness under Section
3.3(b) if the proceeds thereof are used, directly or indirectly, to refinance
any Subordinated Obligations of the Company unless such Indebtedness will be
subordinated to the Securities to at least the same extent as such Subordinated
Obligations. No Subsidiary Guarantor will Incur any indebtedness if the proceeds
thereof are used, directly or indirectly, to refinance any Guarantor
Subordinated Obligations of such Subsidiary Guarantor unless such Indebtedness
will be subordinated to the obligations of such Subsidiary Guarantor under its
Subsidiary Guarantee to at least the same extent as such Guarantor Subordinated
Obligations. No Subsidiary Guarantor will Incur any Indebtedness if the proceeds
thereof are used, directly or indirectly, to refinance any Guarantor Senior
Subordinated Indebtedness unless such Refinancing Indebtedness is either
Guarantor Senior Subordinated Indebtedness or Guarantor Subordinated
Obligations. No Restricted Subsidiary may Incur any Indebtedness if the proceeds
are used to refinance Indebtedness of the Company.
(d) For purposes of determining compliance with, and the
outstanding principal amount of any particular Indebtedness Incurred pursuant to
and in compliance with, this Section 3.3: (1) in the event that Indebtedness
meets the criteria of more than one of the types of Indebtedness described in
Section 3.3(a) or (b), the Company, in its sole discretion, will classify such
item of Indebtedness on the date of Incurrence and only be required to include
the amount and type of such Indebtedness in one of such clauses; (2) all
Indebtedness outstanding on the
53
date of this Indenture under the Credit Agreement shall be deemed initially
Incurred on the Issue Date under clause (1) of Section 3.3(b) and not Section
3.3(a) or clause (4) of Section 3.3(b); (3) Guarantees of, or obligations in
respect of letters of credit relating to, Indebtedness which is otherwise
included in the determination of a particular amount of Indebtedness shall not
be included; (4) if obligations in respect of letters of credit are Incurred
pursuant to a Credit Agreement and are being treated as Incurred pursuant to
clause (1) of Section 3.3(b) and the letters of credit relate to other
Indebtedness, then such other Indebtedness shall not be included; (5) the
principal amount of any Disqualified Stock of the Company or a Restricted
Subsidiary, or Preferred Stock of a Restricted Subsidiary that is not a
Subsidiary Guarantor, will be equal to the greater of the maximum mandatory
redemption or repurchase price (not including, in either case, any redemption or
repurchase premium) or the liquidation preference thereof; (6) Indebtedness
permitted by this Section 3.3 need not be permitted solely by reference to one
provision permitting such Indebtedness but may be permitted in part by one such
provision and in part by one or more other provisions of this Section 3.3
permitting such Indebtedness; and (7) the amount of Indebtedness issued at a
price that is less than the principal amount thereof will be equal to the amount
of the liability in respect thereof determined in accordance with GAAP. Accrual
of interest, accrual of dividends, the accretion of accreted value, the payment
of interest in the form of additional Indebtedness and the payment of dividends
in the form of additional shares of Preferred Stock or Disqualified Stock will
not be deemed to be an Incurrence of Indebtedness for purposes of this Section
3.3. The amount of any Indebtedness outstanding as of any date shall be (i) the
accreted value thereof in the case of any Indebtedness issued with original
issue discount and (ii) the principal amount or liquidation preference thereof,
together with any interest thereon that is more than 30 days past due, in the
case of any other Indebtedness. For purposes of determining compliance with any
U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S.
dollar-equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in
effect on the date such Indebtedness was Incurred, in the case of term
Indebtedness, or first committed, in the case of revolving credit Indebtedness;
provided that if such Indebtedness is Incurred to refinance other Indebtedness
denominated in a foreign currency, and such refinancing would cause the
applicable U.S. dollar-denominated restriction to be exceeded if calculated at
the relevant currency exchange rate in effect on the date of such refinancing,
such U.S. dollar-denominated restriction shall be deemed not to have been
exceeded so long as the principal amount of such Refinancing Indebtedness does
not exceed the principal amount of such Indebtedness being refinanced.
Notwithstanding any other provision of this Section 3.3, the maximum amount of
Indebtedness that the Company may Incur pursuant to this Section 3.3 shall not
be deemed to be exceeded solely as a result of fluctuations in the exchange rate
of currencies. The principal amount of any Indebtedness Incurred to refinance
other Indebtedness, if Incurred in a different currency from the Indebtedness
being refinanced, shall be calculated based on the currency exchange rate
applicable to the currencies in which such Refinancing Indebtedness is
denominated that is in effect on the date of such refinancing.
(e) If at any time an Unrestricted Subsidiary becomes a
Restricted Subsidiary, any Indebtedness of such Subsidiary shall be deemed to be
Incurred by a Restricted Subsidiary as of such date (and, if such Indebtedness
is not permitted to be Incurred as of such date under this Section 3.3, the
Company shall be in Default of this Section 3.3).
54
SECTION 3.4. Limitation on Layering. The Company shall not
Incur any Indebtedness if such Indebtedness is subordinate or junior in right of
payment in any respect to any Senior Indebtedness unless such Indebtedness is
Senior Subordinated Indebtedness or is contractually subordinated in right of
payment to Senior Subordinated Indebtedness. No Subsidiary Guarantor shall Incur
any Indebtedness if such Indebtedness is contractually subordinate or junior in
right of payment in any respect to any Guarantor Senior Indebtedness of such
Subsidiary Guarantor unless such Indebtedness is Guarantor Senior Subordinated
Indebtedness of such Subsidiary Guarantor or is contractually subordinated in
right of payment to Guarantor Senior Subordinated Indebtedness of such
Subsidiary Guarantor.
SECTION 3.5. Limitation on Restricted Payments. (a) The
Company shall not, and shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to (1) declare or pay any dividend or make any
distribution (whether made in cash, securities or other property) on or in
respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving the Company or any of its Restricted
Subsidiaries) except: (A) dividends or distributions payable in Capital Stock of
the Company (other than Disqualified Stock) or in options, warrants or other
rights to purchase such Capital Stock of the Company; and (B) dividends or
distributions payable to the Company or a Restricted Subsidiary (and if such
Restricted Subsidiary is not a Wholly-Owned Subsidiary, to its other holders of
common Capital Stock on a pro rata basis); (2) purchase, redeem, retire or
otherwise acquire for value any Capital Stock of the Company or any direct or
indirect parent of the Company held by Persons other than the Company or a
Restricted Subsidiary (other than in exchange for Capital Stock of the Company
(other than Disqualified Stock)); (3) purchase, repurchase, redeem, defease or
otherwise acquire or retire for value, prior to scheduled maturity, scheduled
repayment or scheduled sinking fund payment, any Subordinated Obligations or
Guarantor Subordinated Obligations (other than the purchase, repurchase,
redemption, defeasance or other acquisition or retirement of Subordinated
Obligations or Guarantor Subordinated Obligations purchased in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity,
in each case due within one year of the date of purchase, repurchase,
redemption, defeasance or other acquisition or retirement); or (4) make any
Restricted Investment in any Person; (any such dividend, distribution, purchase,
redemption, repurchase, defeasance, other acquisition, retirement or Restricted
Investment referred to in clauses (1) through (4) of this Section 3.5(a) shall
be referred to herein as a "Restricted Payment"), if at the time the Company or
such Restricted Subsidiary makes such Restricted Payment: (a) a Default shall
have occurred and be continuing (or would result therefrom); or (b) the Company
is not able to Incur an additional $1.00 of Indebtedness pursuant to Section
3.3(a) after giving effect, on a pro forma basis, to such Restricted Payment; or
(c) the aggregate amount of such Restricted Payment and all other Restricted
Payments declared or made subsequent to the Issue Date would exceed the sum of:
(i) 50% of Consolidated Net Income for the period (treated as one accounting
period) from the first day of the quarter in which the Issue Date occurs to the
end of the most recent fiscal quarter ending prior to the date of such
Restricted Payment for which financial statements are in existence (or, in case
such Consolidated Net Income is a deficit, minus 100% of such deficit); (ii)
100% of the aggregate Net Cash Proceeds received by the Company from the issue
or sale of its Capital Stock (other than Disqualified Stock) or other capital
contributions subsequent to the Issue Date (other than Net Cash Proceeds
received from an issuance or sale of such Capital Stock
55
to a Subsidiary of the Company or an employee stock ownership plan, option plan
or similar trust to the extent such sale to an employee stock ownership plan or
similar trust is financed by loans from or Guaranteed by the Company or any
Restricted Subsidiary unless such loans have been repaid with cash on or prior
to the date of determination); (iii) the amount by which Indebtedness of the
Company or its Restricted Subsidiaries is reduced on the Company's balance sheet
upon the conversion or exchange (other than by a Subsidiary of the Company)
subsequent to the Issue Date of any Indebtedness of the Company or its
Restricted Subsidiaries convertible or exchangeable for Capital Stock (other
than Disqualified Stock) of the Company (less the amount of any cash, or the
fair market value of any other property, distributed by the Company upon such
conversion or exchange); and (iv) the amount equal to the net reduction in
Restricted Investments made by the Company or any of its Restricted Subsidiaries
in any Person resulting from: (A) repurchases or redemptions of such Restricted
Investments by such Person, proceeds realized upon the sale of such Restricted
Investment to an unaffiliated purchaser, repayments of loans or advances or
other transfers of assets (including by way of dividend or distribution) by such
Person to the Company or any Restricted Subsidiary; or (B) the redesignation of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued in each case as
provided in the definition of "Investment") not to exceed, in the case of any
Unrestricted Subsidiary, the amount of Investments previously made by the
Company or any Restricted Subsidiary in such Unrestricted Subsidiary, which
amount in each case under this clause (iv) was included in the calculation of
the amount of Restricted Payments; provided, however, that no amount will be
included under this clause (iv) to the extent it is already included in
Consolidated Net Income.
(b) The provisions of Section 3.5(a) shall not prohibit: (1)
any purchase, repurchase, redemption, defeasance or other acquisition or
retirement of Capital Stock, Disqualified Stock or Subordinated Obligations of
the Company or Guarantor Subordinated Obligations of any Subsidiary Guarantor
made by exchange for, or out of the proceeds of the substantially concurrent
sale of, Capital Stock of the Company (other than Disqualified Stock and other
than Capital Stock issued or sold to a Subsidiary or an employee stock ownership
plan or similar trust to the extent such sale to an employee stock ownership
plan or similar trust is financed by loans from or Guaranteed by the Company or
any Restricted Subsidiary unless such loans have been repaid with cash on or
prior to the date of determination); provided, however, that (a) such purchase,
repurchase, redemption, defeasance, acquisition or retirement will be excluded
in subsequent calculations of the amount of Restricted Payments and (b) the Net
Cash Proceeds from such sale of Capital Stock will be excluded from Section
3.5(a)(4)(c)(ii); (2) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Subordinated Obligations of the Company or
Guarantor Subordinated Obligations of any Subsidiary Guarantor made by exchange
for, or out of the proceeds of the substantially concurrent sale of,
Subordinated Obligations of the Company or any purchase, repurchase, redemption,
defeasance or other acquisition or retirement of Guarantor Subordinated
Obligations made by exchange for or out of the proceeds of the substantially
concurrent sale of Guarantor Subordinated Obligations that, in each case, is
permitted to be Incurred pursuant to Section 3.3 and that in each case
constitutes Refinancing Indebtedness; provided, however, that such purchase,
repurchase, redemption, defeasance, acquisition or retirement will be excluded
in subsequent calculations of the amount of Restricted Payments; (3) any
purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Disqualified Stock of the Company or a Restricted Subsidiary
56
made by exchange for or out of the proceeds of the substantially concurrent sale
of Disqualified Stock of the Company or such Restricted Subsidiary, as the case
may be, that, in each case, is permitted to be Incurred pursuant to Section 3.3
and that in each case constitutes Refinancing Indebtedness; provided, however,
that such purchase, repurchase, redemption, defeasance, acquisition or
retirement will be excluded in subsequent calculations of the amount of
Restricted Payments; (4) so long as no Default or Event of Default has occurred
and is continuing, any purchase or redemption of Subordinated Obligations or
Guarantor Subordinated Obligations of a Subsidiary Guarantor from Net Available
Cash to the extent permitted under Section 3.7; provided, however, that such
purchase or redemption will be excluded in subsequent calculations of the amount
of Restricted Payments; (5) dividends paid within 60 days after the date of
declaration if at such date of declaration such dividend would have complied
with this Section 3.5; provided, however, that such dividends will be included
in subsequent calculations of the amount of Restricted Payments; (6) so long as
no Default or Event of Default has occurred and is continuing, dividends to
Holdings or New Holdings for the purpose of, and in the amounts equal to,
amounts required to permit Holdings or New Holdings: (a) to redeem or repurchase
Capital Stock of Holdings or New Holdings held by any existing or former
employees or management of the Company or any Subsidiary of the Company or their
assigns, estates or heirs, in each case in connection with the repurchase
provisions under employee stock option or stock purchase agreements or other
agreements to compensate management employees; provided that such redemptions or
repurchases pursuant to this Section 3.5(b)(6)(a) will not exceed $4.0 million
in the aggregate for all such redemptions and repurchases; provided, however,
that the amount of any such repurchase or redemption will be included in
subsequent calculations of the amount of Restricted Payments; and (b) to make
loans or advances to employees or directors of the Company or any Subsidiary of
the Company the proceeds of which are used to purchase Capital Stock of Holdings
or New Holdings, in an aggregate amount not in excess of $1.5 million at any one
time outstanding; provided, however, that the amount of such loans and advances
will be included in subsequent calculations of the amount of Restricted
Payments; (7) so long as no Default or Event of Default has occurred and is
continuing, the declaration and payment of dividends to holders of any class or
series of Disqualified Stock of the Company issued in accordance with the terms
of this Indenture to the extent such dividends are included in the definition of
"Consolidated Interest Expense"; provided that the payment of such dividends
will be excluded from the calculation of Restricted Payments; (8) repurchases of
Capital Stock deemed to occur upon the exercise of stock options, warrants or
other convertible securities if such Capital Stock represents a portion of the
exercise price thereof; provided, however, that such repurchases will be
excluded from subsequent calculations of the amount of Restricted Payments; (9)
so long as (a) no Default or Event of Default shall have occurred and be
continuing and (b) immediately before and immediately after giving effect
thereto, the Company would have been permitted to Incur at least $1.00 of
additional Indebtedness pursuant to Section 3.3(a), from and after March 15,
2008, payments of cash dividends to Holdings in an amount sufficient to enable
Holdings to make payments of cash interest required to be made in respect of the
Holdings Senior Discount Notes in accordance with the terms thereof in effect on
the date of this Indenture, provided Holdings is otherwise unable to pay such
interest and such dividends are applied directly to the payment of such
interest; and provided, further, that such payments will be excluded from the
calculation of the amount of Restricted Payments; (10) cash dividends or loans
to Holdings or New Holdings in amounts equal to: (a) the amounts required for
Holdings
57
or New Holdings to pay any Federal, state or local income taxes to the extent
that such income taxes are directly attributable to the income of the Company
and its Restricted Subsidiaries; (b) the amounts required for Holdings and New
Holdings to pay franchise taxes and other fees required to maintain their legal
existence; (c) an amount not to exceed $500,000 in any fiscal year to permit
Holdings and New Holdings to pay their corporate overhead expenses Incurred in
the ordinary course of business, and to pay salaries or other compensation of
employees who perform services for the Company and one or more of Holdings or
New Holdings; (d) so long as no Default or Event of Default shall have occurred
and be continuing, an amount not to exceed $100,000 in the aggregate, to enable
Holdings or New Holdings to make payments to holders of its Capital Stock in
lieu of issuance of fractional shares of its Capital Stock; and (e) the amounts
payable by Holdings or New Holdings in connection with the Transaction;
provided, that such dividends or loans will be excluded from subsequent
calculations of the amount of Restricted Payments; (11) the purchase,
repurchase, redemption, defeasance or other acquisition or retirement for value
of any Subordinated Obligation (i) at a purchase price not greater than 101% of
the principal amount of such Subordinated Obligation in the event of a Change of
Control in accordance with provisions similar to Section 3.9 or (ii) at a
purchase price not greater than 100% of the principal amount thereof in
accordance with provisions similar to Section 3.7; provided that, prior to or
simultaneously with such purchase, repurchase, redemption, defeasance or other
acquisition or retirement, the Company has made the Change of Control Offer or
Asset Disposition Offer, as applicable, as provided in Section 3.7 or Section
3.9 with respect to the Securities and has completed the repurchase or
redemption of all Securities validly tendered for payment in connection with
such Change of Control Offer or Asset Disposition Offer; (12) the purchase,
repurchase, acquisition or redemption of the 8 3/4% Notes (including any
prepayment penalties, premiums, fees (including consent fees) and expenses); and
(13) other Restricted Payments in an amount not to exceed $10.0 million;
provided that the amount of such Restricted Payments will be included in the
calculation of the amount of Restricted Payments.
The amount of all Restricted Payments (other than cash) shall
be the fair market value on the date of such Restricted Payment of the asset(s)
or securities proposed to be paid, transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to such Restricted Payment.
The fair market value of any cash Restricted Payment shall be its face amount
and any non-cash Restricted Payment shall be determined conclusively by the
Board of Directors of the Company acting in good faith whose resolution with
respect thereto shall be delivered to the Trustee, such determination to be
based upon an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing if such fair market value is
estimated in good faith by the Board of Directors of the Company to exceed $5.0
million. Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 3.5 were computed, together with a copy of
any fairness opinion or appraisal required by this Indenture.
SECTION 3.6. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. (a) The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary to: (1) pay dividends or make
58
any other distributions on its Capital Stock or pay any Indebtedness or other
obligations owed to the Company or any Restricted Subsidiary (it being
understood that the priority of any Preferred Stock in receiving dividends or
liquidating distributions prior to dividends or liquidating distributions being
paid on Common Stock shall not be deemed a restriction on the ability to make
distributions on Capital Stock); (2) make any loans or advances to the Company
or any Restricted Subsidiary (it being understood that the subordination of
loans or advances made to the Company or any Restricted Subsidiary to other
Indebtedness Incurred by the Company or any Restricted Subsidiary shall not be
deemed a restriction on the ability to make loans or advances); or (3) transfer
any of its property or assets to the Company or any Restricted Subsidiary.
(b) The provisions of Section 3.6(a) will not prohibit: (i)
any encumbrance or restriction pursuant to an agreement in effect at or entered
into on the date of this Indenture, including, without limitation, this
Indenture, the indenture for the 8 3/4% Notes and the Credit Agreement; (ii) any
encumbrance or restriction with respect to a Restricted Subsidiary pursuant to
an agreement relating to any Capital Stock or Indebtedness Incurred by a
Restricted Subsidiary on or before the date on which such Restricted Subsidiary
was acquired by the Company (other than Capital Stock or Indebtedness Incurred
as consideration in, or to provide all or any portion of the funds utilized to
consummate, the transaction or series of related transactions pursuant to which
such Restricted Subsidiary became a Restricted Subsidiary or was acquired by the
Company or in contemplation of the transaction) and outstanding on such date
provided, that any such encumbrance or restriction shall not extend to any
assets or property of the Company or any other Restricted Subsidiary other than
the assets and property so acquired; (iii) any encumbrance or restriction with
respect to a Restricted Subsidiary pursuant to an agreement effecting a
refunding, replacement or refinancing of Indebtedness Incurred pursuant to an
agreement referred to in Section 3.6(b)(i) or (b)(ii) or this Section
3.6(b)(iii) or contained in any amendment to an agreement referred to in Section
3.6(b)(i) or (b)(ii) or this Section 3.6(b)(iii); provided, however, that the
encumbrances and restrictions with respect to such Restricted Subsidiary
contained in any such agreement are no less favorable in any material respect to
the Holders of the Securities than the encumbrances and restrictions contained
in such agreements referred to in Section 3.6(b)(i) or (b)(ii) on the Issue Date
or the date such Restricted Subsidiary became a Restricted Subsidiary, whichever
is applicable; (iv) in the case of Section 3.6(b)(iii), any encumbrance or
restriction (a) that restricts in a customary manner the subletting, assignment
or transfer of any property or asset that is subject to a lease, license or
similar contract, or the assignment or transfer of any such lease, license or
other contract; (b) contained in mortgages, pledges or other security agreements
permitted under the Indenture securing Indebtedness of the Company or a
Restricted Subsidiary to the extent such encumbrances or restrictions restrict
the transfer of the property subject to such mortgages, pledges or other
security agreements; or (c) pursuant to customary provisions restricting
dispositions of real property interests set forth in any reciprocal easement
agreements of the Company or any Restricted Subsidiary; (v) (a) purchase money
obligations for property acquired in the ordinary course of business and (b)
Capitalized Lease Obligations permitted under this Indenture, in each case, that
impose encumbrances or restrictions of the nature described in clause (3) of
Section 3.6(a) on the property so acquired; (vi) any restriction with respect to
a Restricted Subsidiary (or any of its property or assets) imposed pursuant to
an agreement entered into for the direct or
59
indirect sale or disposition of all or substantially all the Capital Stock or
assets of such Restricted Subsidiary (or the property or assets that are subject
to such restriction) pending the closing of such sale or disposition; (vii) net
worth provisions in leases and other agreements entered into by the Company or
any Restricted Subsidiary in the ordinary course of business; and (viii)
encumbrances or restrictions arising or existing by reason of applicable law or
any applicable rule, regulation or order.
SECTION 3.7. Limitation on Sales of Assets and Subsidiary
Stock. (a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any Asset Disposition unless: (1) in the case of any Asset
Disposition involving shares or assets having a value equal to or in excess of
$1.0 million, the Company or such Restricted Subsidiary, as the case may be,
receives consideration at least equal to the fair market value (such fair market
value to be determined on the date of contractually agreeing to such Asset
Disposition), as determined in good faith by the Board of Directors (including
the value of all non-cash consideration), of the shares and assets subject to
such Asset Disposition; (2) in the case of any Asset Disposition involving
shares or assets having a value equal to or in excess of $1.0 million, at least
75% of the consideration from such Asset Disposition received by the Company or
such Restricted Subsidiary, as the case may be, is in the form of cash or Cash
Equivalents; and (3) an amount equal to 100% of the Net Available Cash from such
Asset Disposition is applied by the Company or such Restricted Subsidiary, as
the case may be: (a) first, to the extent the Company or any Restricted
Subsidiary, as the case may be, elects (or is required by the terms of any
Senior Indebtedness or Guarantor Senior Indebtedness), to prepay, repay or
purchase Senior Indebtedness of the Company or Indebtedness of a Restricted
Subsidiary (other than any Disqualified Stock or Guarantor Senior Subordinated
Indebtedness or Guarantor Subordinated Obligation of a Wholly-Owned Subsidiary
Guarantor) (in each case other than Indebtedness owed to the Company or an
Affiliate of the Company) within 360 days from the later of the date of such
Asset Disposition or the receipt of such Net Available Cash; provided, however,
that, in connection with any prepayment, repayment or purchase of Indebtedness
pursuant to this clause (a), the Company or such Restricted Subsidiary will
retire such Indebtedness and will cause the related commitment (if any) to be
permanently reduced in an amount equal to the principal amount so prepaid,
repaid or purchased; and (b) second, to the extent of the balance of such Net
Available Cash after application in accordance with Section 3.7(a)(3)(a), to the
extent the Company or such Restricted Subsidiary elects, to invest in Additional
Assets within 360 days from the later of the date of such Asset Disposition or
the receipt of such Net Available Cash; provided that pending the final
application of any such Net Available Cash in accordance with Section
3.7(a)(3)(a) or Section 3.7(a)(3)(b) above, the Company and its Restricted
Subsidiaries may temporarily reduce Indebtedness or otherwise invest such Net
Available Cash in any manner not prohibited by this Indenture.
(b) Any Net Available Cash from Asset Dispositions that are
not applied or invested as provided in Section 3.7(a)(3) will be deemed to
constitute "Excess Proceeds." On the 361st day after an Asset Disposition, if
the aggregate amount of Excess Proceeds exceeds $5.0 million, the Company will
be required to make an offer ("Asset Disposition Offer") to all Holders of
Securities and to the extent required by the terms of other Senior Subordinated
Indebtedness, to all holders of other Senior Subordinated Indebtedness
outstanding with similar
60
provisions requiring the Company to make an offer to purchase such Senior
Subordinated Indebtedness with the proceeds from any Asset Disposition ("Pari
Passu Notes"), to purchase the maximum principal amount of Securities and any
such Pari Passu Notes to which the Asset Disposition Offer applies that may be
purchased out of the Excess Proceeds, at an offer price in cash in an amount
equal to 100% of the principal amount of the Securities and Pari Passu Notes
plus accrued and unpaid interest to the date of purchase, in accordance with the
procedures set forth in this Indenture or the agreements governing the Pari
Passu Notes, as applicable, in each case in integral multiples of $1,000 of
principal amount. To the extent that the aggregate amount of Securities and Pari
Passu Notes so validly tendered and not properly withdrawn pursuant to an Asset
Disposition Offer is less than the Excess Proceeds, the Company may use any
remaining Excess Proceeds for general corporate purposes, subject to other
covenants contained in this Indenture. If the aggregate principal amount of
Securities surrendered by holders thereof and other Pari Passu Notes surrendered
by holders or lenders, collectively, exceeds the amount of Excess Proceeds, the
Trustee shall select the Securities and Pari Passu Notes to be purchased on a
pro rata basis on the basis of the aggregate principal amount of tendered
Securities and Pari Passu Notes. Upon completion of such Asset Disposition
Offer, the amount of Excess Proceeds shall be reset at zero.
(c) (1) The Asset Disposition Offer will remain open for a
period of 20 Business Days following its commencement, except to the extent that
a longer period is required by applicable law (the "Asset Disposition Offer
Period"). No later than five Business Days after the termination of the Asset
Disposition Offer Period (the "Asset Disposition Purchase Date"), the Company
will purchase the principal amount of Securities and Pari Passu Notes required
to be purchased pursuant to this Section 3.7 (the "Asset Disposition Offer
Amount") or, if less than the Asset Disposition Offer Amount has been so validly
tendered, all Securities and Pari Passu Notes validly tendered in response to
the Asset Disposition Offer.
If the Asset Disposition Purchase Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest will be paid to the Person in whose name a Security
is registered at the close of business on such record date, and no additional
interest will be payable to Holders who tender Securities pursuant to the Asset
Disposition Offer.
On or before the Asset Disposition Purchase Date, the Company
will, to the extent lawful, accept for payment, on a pro rata basis to the
extent necessary, the Asset Disposition Offer Amount of Securities and Pari
Passu Notes or portions of Securities and Pari Passu Notes so validly tendered
and not properly withdrawn pursuant to the Asset Disposition Offer, or if less
than the Asset Disposition Offer Amount has been validly tendered and not
properly withdrawn, all Securities and Pari Passu Notes so validly tendered and
not properly withdrawn, in each case in integral multiples of $1,000 of
principal amount. The Company will deliver to the Trustee an Officers'
Certificate stating that such Securities or portions thereof were accepted for
payment by the Company in accordance with the terms of this Section 3.7 and, in
addition, the Company will deliver all certificates and notes required, if any,
by the agreements governing the Pari Passu Notes. The Company or the Paying
Agent, as the case may be, will promptly (but in any case not later than five
Business Days after termination of the Asset Disposition Offer Period) mail or
deliver to each tendering Holder of Securities or holder or
61
lender of Pari Passu Notes, as the case may be, an amount equal to the purchase
price of the Securities or Pari Passu Notes so validly tendered and not properly
withdrawn by such Holder or lender, as the case may be, and accepted by the
Company for purchase, and the Company will promptly issue a new Security, and
the Trustee, upon delivery of an Officers' Certificate from the Company, will
authenticate and mail or deliver such new Security to such Holder, in a
principal amount equal to any unpurchased portion of the Security surrendered;
provided that each such new Security will be in a principal amount of $1,000 or
an integral multiple of $1,000. In addition, the Company will take any and all
other actions required by the agreements governing the Pari Passu Notes. Any
Security not so accepted will be promptly mailed or delivered by the Company to
the Holder thereof. The Company will publicly announce the results of the Asset
Disposition Offer on the Asset Disposition Purchase Date.
For the purposes of this Section 3.7, the following will be
deemed to be cash:
(1) the assumption by the transferee of Indebtedness
(other than Senior Subordinated Indebtedness,
Subordinated Obligations or Disqualified Stock) of
the Company or Indebtedness of a Restricted
Subsidiary (other than Guarantor Senior Subordinated
Indebtedness, Guarantor Subordinated Obligations or
Disqualified Stock of any Wholly-Owned Subsidiary
that is a Subsidiary Guarantor) and the release of
the Company or such Restricted Subsidiary from all
liability on such Indebtedness in connection with
such Asset Disposition (in which case the Company
will, without further action, be deemed to have
applied such deemed cash to Indebtedness in
accordance with Section 3.7(a)(3)(a)); and
(2) securities, notes or other obligations received by
the Company or any Restricted Subsidiary from the
transferee that are promptly converted by the Company
or such Restricted Subsidiary into cash.
(d) The Company will comply, to the extent applicable, with
the requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant to
this Indenture. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 3.7, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Indenture by virtue thereof.
SECTION 3.8. Limitation on Affiliate Transactions. (a) The
Company will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, enter into or conduct any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any Affiliate of the Company (an "Affiliate Transaction") unless:
(1) the terms of such Affiliate Transaction are no less favorable to the Company
or such Restricted Subsidiary, as the case may be, than those that could be
obtained in a comparable transaction at the time of such transaction in
arm's-length dealings with a Person who is not such an Affiliate; (2) in the
event such Affiliate Transaction involves an aggregate consideration in excess
of $1.0 million, the terms of such transaction have been approved by a majority
of the members of the Board of Directors of the Company and by a majority of the
members of such
62
Board having no personal stake in such transaction, if any (and such majority or
majorities, as the case may be, determines that such Affiliate Transaction
satisfies the criteria in Section 3.8(a)(1)); and (3) in the event such
Affiliate Transaction involves an aggregate consideration in excess of $5.0
million, the Company has received a written opinion from an independent
investment banking, accounting or appraisal firm of nationally recognized
standing that such Affiliate Transaction is not materially less favorable than
those that might reasonably have been obtained in a comparable transaction at
such time on an arm's-length basis from a Person that is not an Affiliate.
(b) Section 3.8(a) shall not apply to: (1) any Restricted
Payment (other than a Restricted Investment) permitted to be made pursuant to
Section 3.5; (2) any issuance of securities, or other payments, awards or grants
in cash, securities or otherwise pursuant to, or the funding of, employment
agreements and other compensation arrangements, options to purchase Capital
Stock of the Company, restricted stock plans, long-term incentive plans, stock
appreciation rights plans, participation plans or similar employee benefits
plans and/or indemnity provided on behalf of officers and employees approved by
the Board of Directors; (3) loans or advances to employees, officers or
directors in the ordinary course of business of the Company or any of its
Restricted Subsidiaries but in any event not to exceed $1.5 million in the
aggregate outstanding at any one time with respect to all loans or advances made
since the Issue Date; (4) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries and Guarantees issued by the
Company or a Restricted Subsidiary for the benefit of the Company or a
Restricted Subsidiary, as the case may be, in accordance with Section 3.3; (5)
the payment of reasonable and customary fees paid to, and indemnity provided on
behalf of, directors of the Company or any Restricted Subsidiary; (6) the fees
payable by the Company in connection with the Transaction; (7) the performance
of obligations of the Company or any of its Restricted Subsidiaries under the
terms of any agreement to which the Company or any of its Restricted
Subsidiaries is a party as of or on the Issue Date and identified on a schedule
to this Indenture on the Issue Date, as these agreements may be amended,
modified, supplemented, extended or renewed from time to time; provided,
however, that any future amendment, modification, supplement, extension or
renewal entered into after the Issue Date will be permitted to the extent that
its terms are not more disadvantageous to the holders of the Securities than the
terms of the agreements in effect on the Issue Date; (8) the issuance of Capital
Stock (other than Disqualified Stock) of the Company to any Affiliate; and (9)
entrance into and performance of any employment agreement entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of business
or approved by the Board of Directors in good faith.
SECTION 3.9. Change of Control. Upon the occurrence of a
Change of Control, unless the Company has exercised its right to redeem all of
the Securities in accordance with Article V, each Holder will have the right to
require the Company to repurchase all or any part (equal to $1,000 of principal
amount of an integral multiple thereof) of such Holder's Securities at a
purchase price in cash equal to 101% of the principal amount thereof plus
accrued and unpaid interest, if any, to the date of purchase (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date):
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Within 30 days following any Change of Control unless the
Company has exercised its right to redeem Securities under Section 5.1, the
Company will mail a notice (the "Change of Control Offer") to each Holder, with
a copy to the Trustee, stating:
(1) that a Change of Control has occurred and that such Holder
has the right to require the Company to purchase such holder's Securities at a
purchase price in cash equal to 101% of the principal amount of such Securities
plus accrued and unpaid interest, if any, to the date of purchase (subject to
the right of Holders of record on the relevant record date to receive interest
due on the relevant interest payment date) (the "Change of Control Payment");
(2) the repurchase date (which shall be no earlier than 30
days nor later than 60 days from the date such notice is mailed) (the "Change of
Control Payment Date"); and
(3) the procedures determined by the Company, consistent with
this Indenture, that a holder must follow in order to have its Securities
repurchased.
On the Change of Control Payment Date, the Company will, to
the extent lawful: (1) accept for payment all Securities or portions of
Securities (in integral multiples of $1,000 of principal amount) properly
tendered pursuant to the Change of Control Offer; (2) deposit with the paying
agent an amount equal to the Change of Control Payment in respect of all
Securities or portions of Securities so tendered; and (3) deliver or cause to be
delivered to the Trustee the Securities so accepted together with an Officers'
Certificate stating the aggregate principal amount of Securities or portions of
Securities being purchased by the Company.
The paying agent will promptly mail to each holder of
Securities so tendered the Change of Control Payment for such Securities, and
the Trustee will promptly authenticate and mail (or cause to be transferred by
book entry) to each holder a new Security equal in principal amount to any
unpurchased portion of the Securities surrendered, if any; provided that each
such new Security will be in a principal amount of $1,000 or an integral
multiple thereof.
If the Change of Control Payment Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest, if any, will be paid to the Person in whose name a
Security is registered at the close of business on such record date, and no
additional interest will be payable to holders who tender pursuant to the Change
of Control Offer.
Prior to mailing a Change of Control Offer, and as a condition
to such Change of Control Offer, (i) all Senior Indebtedness must be repaid in
full, or the Company must offer to repay all Senior Indebtedness and make
payment to the holders that accept such offer and obtain waivers of any event of
default from the remaining holders of such Senior Indebtedness or (ii) the
requisite holders of each issue of Senior Indebtedness shall have consented to
such Change of Control Offer being made. The Company will effect such repayment
or obtain such consent within 60 days following any Change of Control, it being
a default of this Section 3.9 if the Company fails to so comply.
The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times
64
and otherwise in compliance with the requirements set forth in this Section 3.9
applicable to a Change of Control Offer made by the Company and purchases all
Securities validly tendered and not withdrawn under such Change of Control
Offer.
The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 3.9. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Indenture, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations described in this Indenture by virtue of the
conflict.
SECTION 3.10. Limitation on Sale of Capital Stock of
Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, transfer, convey, sell, lease or otherwise dispose of
any Voting Stock of any Restricted Subsidiary or, with respect to a Restricted
Subsidiary, to issue any of its Voting Stock (other than, if necessary, shares
of its Voting Stock constituting directors' qualifying shares) to any Person
except: (1) to the Company or a Wholly-Owned Subsidiary; or (2) in compliance
with Section 3.7 and immediately after giving effect to such issuance or sale,
such Restricted Subsidiary would continue to be a Restricted Subsidiary.
Notwithstanding the preceding paragraph, the Company or any
Restricted Subsidiary may sell all the Voting Stock of a Restricted Subsidiary
as long as the Company or any Restricted Subsidiary complies with the terms of
Section 3.7.
SECTION 3.11. Limitation on Liens. The Company will not, and
will not permit any of its Restricted Subsidiaries to, directly or indirectly,
create, Incur or suffer to exist any Lien (other than Permitted Liens) upon any
of its property or assets (including Capital Stock of Restricted Subsidiaries),
whether owned on the date of this Indenture or acquired after that date, which
Lien secures any Senior Subordinated Indebtedness, or Subordinated Obligations,
Guarantor Senior Subordinated Indebtedness or Guarantor Subordinated
Obligations, unless contemporaneously with the Incurrence of such Liens
effective provision is made to secure (a) the Indebtedness due under this
Indenture and the Securities or (b) in respect of Liens on any Restricted
Subsidiary's property or assets, any Subsidiary Guarantee of such Restricted
Subsidiary, equally and ratably with (or prior to in the case of Liens with
respect to Subordinated Obligations or Guarantor Subordinated Obligations, as
the case may be) the Indebtedness secured by such Lien for so long as such
Indebtedness is so secured.
SECTION 3.12. Future Subsidiary Guarantors. After the Issue
Date, the Company will cause each Restricted Subsidiary created or acquired by
the Company or one or more of its Restricted Subsidiaries that have guaranteed
Indebtedness under the Credit Agreement to execute and deliver to the Trustee a
Subsidiary Guarantee pursuant to which such Subsidiary Guarantor will
unconditionally Guarantee, on a joint and several basis, the full and prompt
payment of the principal of, premium, if any and interest on the Securities on a
senior subordinated basis provided, that, upon the release of a Guarantee by a
Subsidiary Guarantor under the Credit Agreement, such Subsidiary Guarantor will
be deemed released from all of its obligations under this Indenture and its
Subsidiary Guarantee will terminate; provided, further,
65
that in the event that any such Restricted Subsidiary thereafter guarantees any
Indebtedness of the Company under the Credit Agreement (or if any released
Guarantee under the Credit Agreement is reinstated or renewed), then such
Restricted Subsidiary will guarantee the Securities on the terms and conditions
set forth herein.
SECTION 3.13. Limitation on Lines of Business. The Company
will not, and will not permit any Restricted Subsidiary to, engage in any
business other than a Related Business.
SECTION 3.14. Maintenance of Office or Agency.
The Company will maintain in The City of New York, an office
or agency where the Securities may be presented or surrendered for payment,
where, if applicable, the Securities may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The corporate trust
office of the Trustee shall be such office or agency of the Company, unless the
Company shall designate and maintain some other office or agency for one or more
of such purposes. The Company will give prompt written notice to the Trustee of
any change in the location of any such office or agency. If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside of The City of New York) where the
Securities may be presented or surrendered for any or all such purposes and may
from time to time rescind any such designation; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in The City of New York for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and any change in the location of any such other
office or agency.
SECTION 3.15. Corporate Existence.
Subject to Article IV and Section 11.2, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and that of each Restricted Subsidiary and the
corporate rights (charter and statutory) licenses and franchises of the Company
and each Restricted Subsidiary; provided, however, that the Company shall not be
required to preserve any such existence (except the Company), right, license or
franchise if the Board of Directors of the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and each of its Restricted Subsidiaries, taken as a whole, and that
the loss thereof is not, and will not be, disadvantageous in any material
respect to the Holders; and provided, further, the Company may merge in
accordance with Section 4.1 and Section 11.2.
SECTION 3.16. [Reserved].
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SECTION 3.17. Compliance Certificate. The Company shall
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company an Officers' Certificate stating that in the course of the performance
by the signers of their duties as Officers of the Company they would normally
have knowledge of any Default or Event of Default and whether or not the signers
know of any Default or Event of Default that occurred during such previous
fiscal year. If they do, the certificate shall describe the Default or Event of
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA Section 314(a)(4).
SECTION 3.18. Further Instruments and Acts. Upon request of
the Trustee, the Company will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 3.19. Payments for Consent
Neither the Company nor any of its Restricted Subsidiaries
will, directly or indirectly, pay or cause to be paid any consideration, whether
by way of interest, fees or otherwise, to any Holder of any Securities for or as
an inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Securities unless such consideration is
offered to be paid or is paid to all Holders of the Securities that consent,
waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or amendment.
SECTION 3.20. Statement by Officers as to Default
The Company shall deliver to the Trustee, as soon as possible
and in any event within 30 days after the Company becomes aware of the
occurrence of any Event of Default or an event which, with notice or the lapse
of time or both, would constitute an Event of Default, an Officers' Certificate
setting forth the details of such Event of Default or Default, its status and
the actions which the Company is taking or proposes to take with respect
thereto.
ARTICLE IV
Successor Company
SECTION 4.1. Merger and Consolidation. The Company shall not
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the
"Successor Company") will be a corporation or limited liability company
organized or formed, as the case may be, and existing under the laws of
the United States of America, any State of the United States or the
District of Columbia and the Successor Company (if not the Company)
will expressly assume, by supplemental indenture, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Indenture;
67
(2) immediately after giving effect to such transaction
(and treating any Indebtedness that becomes an obligation of the
Successor Company or any Subsidiary of the Successor Company as a
result of such transaction as having been Incurred by the Successor
Company or such Subsidiary at the time of such transaction), no Default
or Event of Default shall have occurred and be continuing;
(3) immediately after giving effect to such transaction,
the Successor Company would be able to Incur at least an additional
$1.00 of Indebtedness pursuant to Section 3.3(a);
(4) unless the Company is the Successor Company, each
Subsidiary Guarantor (unless it is the other party to the transactions
above, in which case clause (1) and Section 11.2 shall apply) shall
have by supplemental indenture confirmed that its Subsidiary Guarantee
shall apply to such Person's obligations in respect of this Indenture
and the Securities and its obligations under the Registration Rights
Agreement shall continue to be in effect; and
(5) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if
any) comply with this Indenture.
For purposes of this Section 4.1, the sale, lease, conveyance,
assignment, transfer or other disposition of all or substantially all of the
properties and assets of one or more Subsidiaries of the Company, which
properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.
The predecessor Company (if not the Successor Company) will be
released from its obligations under this Indenture and the Successor Company
will succeed to, and be substituted for, and may exercise every right and power
of, the Company under this Indenture, but, in the case of a lease of all or
substantially all its assets, the predecessor Company will not be released from
the obligation to pay the principal of and interest on the Securities.
Notwithstanding the preceding clause (3), (x) any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Company and (y) the Company may merge with an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another jurisdiction to realize tax benefits; provided that, in the case of a
Restricted Subsidiary that merges into the Company, the Company will not be
required to comply with the preceding clause (5).
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ARTICLE V
Redemption of Securities
SECTION 5.1. Optional Redemption. The Securities may or shall,
as the case may be, be redeemed, as a whole or from time to time in part,
subject to the conditions and at the Redemption Prices specified in the form of
Securities set forth in Exhibits A and B hereto, which are hereby incorporated
by reference and made a part of this Indenture, together with accrued and unpaid
interest to the Redemption Date.
SECTION 5.2. Applicability of Article. Redemption of
Securities at the election of the Company or otherwise, as permitted or required
by any provision of this Indenture, shall be made in accordance with such
provision and this Article.
SECTION 5.3. Election to Redeem; Notice to Trustee. The
election of the Company to redeem any Securities pursuant to Section 5.1 shall
be evidenced by a Board Resolution. In case of any redemption at the election of
the Company, the Company shall, upon not less than 30 and not more than 60 days
prior to the Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such Redemption Date and
of the principal amount of Securities to be redeemed and shall deliver to the
Trustee such documentation and records as shall enable the Trustee to select the
Securities to be redeemed pursuant to Section 5.4.
SECTION 5.4. Selection by Trustee of Securities to Be
Redeemed. If less than all the Securities are to be redeemed at any time
pursuant to an optional redemption, the particular Securities to be redeemed
shall be selected not more than 90 days prior to the Redemption Date by the
Trustee, from the outstanding Securities not previously called for redemption,
in compliance with the requirements of the principal securities exchange, if
any, on which such Securities are listed, or, if such Securities are not so
listed, on a pro rata basis, by lot or by such other method as the Trustee in
its sole discretion shall deem fair and appropriate (and in such manner as
complies with applicable legal requirements) and which may provide for the
selection for redemption of portions of the principal of the Securities;
provided, however, that no such partial redemption shall reduce the portion of
the principal amount of a Security not redeemed to less than $1,000.
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of Securities shall
relate, in the case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has been or is to be
redeemed.
SECTION 5.5. Notice of Redemption. Notice of redemption shall
be given in the manner provided for in Section 13.2 not less than 30 nor more
than 60 days prior to the
69
Redemption Date, to each Holder of Securities to be redeemed. The Trustee shall
give notice of redemption in the Company's name and at the Company's expense;
provided, however, that the Company shall deliver to the Trustee, at least 45
days prior to the Redemption Date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the following items.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price and the amount of accrued
interest to the Redemption Date payable as provided in Section 5.7, if
any,
(3) if less than all outstanding Securities are to be
redeemed, the identification of the particular Securities (or portion
thereof) to be redeemed, as well as the aggregate principal amount of
Securities to be redeemed and the aggregate principal amount of
Securities to be Outstanding after such partial redemption,
(4) in case any Security is to be redeemed in part only,
the notice which relates to such Security shall state that on and after
the Redemption Date, upon surrender of such Security, the Holder will
receive, without charge, a new Security or Securities of authorized
denominations for the principal amount thereof remaining unredeemed,
(5) that on the Redemption Date the Redemption Price (and
accrued interest, if any, to the Redemption Date payable as provided in
Section 5.7) will become due and payable upon each such Security, or
the portion thereof, to be redeemed, and, unless the Company defaults
in making the redemption payment, that interest on Securities called
for redemption (or the portion thereof) will cease to accrue on and
after said date,
(6) the place or places where such Securities are to be
surrendered for payment of the Redemption Price and accrued interest,
if any,
(7) the name and address of the Paying Agent,
(8) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price,
(9) the CUSIP number, and that no representation is made
as to the accuracy or correctness of the CUSIP number, if any, listed
in such notice or printed on the Securities, and
(10) the paragraph of the Securities pursuant to which the
Securities are to be redeemed.
SECTION 5.6. Deposit of Redemption Price. Prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 2.4) an amount of
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money sufficient to pay the Redemption Price of, and accrued interest on, all
the Securities which are to be redeemed on that date.
SECTION 5.7. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified (together with accrued interest, if any, to the Redemption
Date), and from and after such date (unless the Company shall default in the
payment of the Redemption Price and accrued interest) such Securities shall
cease to bear interest. Upon surrender of any such Security for redemption in
accordance with said notice, such Security shall be paid by the Company at the
Redemption Price, together with accrued interest, if any, to the Redemption Date
(subject to the rights of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date).
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate borne by
the Securities.
SECTION 5.8. Securities Redeemed in Part.
Any Security which is to be redeemed only in part (pursuant to
the provisions of this Article) shall be surrendered at the office or agency of
the Company maintained for such purpose pursuant to Section 3.14 (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or such Holder's attorney duly authorized in writing),
and the Company shall execute, and the Trustee shall authenticate and deliver to
the Holder of such Security at the expense of the Company, 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 unredeemed portion
of the principal of the Security so surrendered, provided, that each such new
Security will be in a principal amount of $1,000 or integral multiple thereof.
ARTICLE VI
Defaults and Remedies
SECTION 6.1. Events of Default. An "Event of Default" occurs
if:
(1) the Company defaults in any payment of interest or
additional interest (as required by the Registration Rights Agreement)
on any Security when due, continued for 30 days, whether or not such
payment is prohibited by Article X of this Indenture;
(2) the Company defaults in the payment of principal of
or premium, if any, on any Security when due at its Stated Maturity,
upon optional redemption, upon required repurchase, upon declaration or
otherwise, whether or not such payment shall be prohibited by Article X
of this Indenture;
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(3) the Company or any Subsidiary Guarantor fails to
comply with Article IV or Section 11.2 of this Indenture;
(4) the Company fails to comply with Section 3.2, 3.3,
3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.17,
3.18 and 3.19 (in each case other than a failure to repurchase
Securities when required pursuant to Sections 3.7 or 3.9 of this
Indenture, which failure shall constitute an Event of Default under
Section 6.1(2) and other than a failure to comply with Article IV or
Section 11.2 which failure shall constitute an Event of Default under
Section 6.1(3)) and such failure continues for 30 days after the notice
specified below;
(5) the Company defaults in the performance of or a
breach by the Company of any other covenant or agreement in this
Indenture or under the Securities (other than those referred to in (1),
(2), (3) or (4) above) and such default continues for 60 days after the
notice specified below;
(6) there is a default under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company
or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Restricted Subsidiaries), other
than Indebtedness owed to the Company or a Restricted Subsidiary,
whether such Indebtedness or guarantee now exists, or is created after
the date of this Indenture, which default (a) is caused by a failure to
pay principal of, or interest or premium, if any, on such Indebtedness
prior to the expiration of the grace period provided in such
Indebtedness ("Payment Default") or (b) results in the acceleration of
such Indebtedness prior to its maturity (the "cross acceleration
provision") and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $15.0 million or
more or its foreign currency equivalent at the time;
(7) the Company or a Significant Subsidiary or a group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries), would constitute a Significant Subsidiary, pursuant to
or within the meaning of any Bankruptcy Law (as defined below):
(A) commences a voluntary case;
(B) consents to the entry of an order for
relief against it in an involuntary case;
(C) consents to the appointment of a
Custodian (as defined below) of it or for any
substantial part of its property; or
(D) makes a general assignment for the
benefit of its creditors;
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or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together (as of the latest
audited consolidated financial statements for the
Company and its Restricted Subsidiaries) would
constitute a Significant Subsidiary in an involuntary
case;
(B) appoints a Custodian of the Company or
any Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together (as of the latest
audited consolidated financial statements for the
Company and its Restricted Subsidiaries) would
constitute a Significant Subsidiary or for any
substantial part of its property; or
(C) orders the winding up or liquidation of
the Company or any Significant Subsidiary or any
group of Restricted Subsidiaries that, taken together
(as of the latest audited consolidated financial
statements for the Company and its Restricted
Subsidiaries) would constitute a Significant
Subsidiary;
or any similar relief is granted under any foreign laws and the order,
decree or relief remains unstayed and in effect for 60 days;
(9) the Company or any Significant Subsidiary or group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary fails to pay
final, non-appealable judgments aggregating in excess of $15.0 million
or its foreign currency equivalent at the time (net of any amounts that
a reputable and creditworthy insurance company has acknowledged
liability for in writing), which judgments are not paid, discharged or
stayed for a period of 60 days; or
(10) any Subsidiary Guarantee ceases to be in full force
and effect (except as contemplated by the terms hereof) or is declared
null and void in a judicial proceeding or any Subsidiary Guarantor
denies or disaffirms its obligations under this Indenture or its
Subsidiary Guarantee.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
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The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code,
or any similar Federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
Notwithstanding the foregoing, a Default under clause (4) or
(5) of this Section 6.1 will not constitute an Event of Default until the
Trustee or the Holders of at least 25% in principal amount of the outstanding
Securities notify the Company of the Default and the Company does not cure such
Default within the time specified in said clause (4) or (5) after receipt of
such notice. Such notice must specify the Default, demand that it be remedied
and state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any Default or Event of Default under clauses (3), (4), (5), (6), (7), (8),
(9) or (10) of this Section 6.1, which such notice shall contain the status
thereof and a description of the action being taken or proposed to be taken by
the Company in respect thereof.
SECTION 6.2. Acceleration. If an Event of Default (other than
an Event of Default specified in Section 6.1(7) or (8)) occurs and is
continuing, the Trustee by notice to the Company, or the Holders of at least 25%
in principal amount of the outstanding Securities by notice to the Company and
the Trustee, may, and the Trustee at the request of such Holders shall, declare
the principal of, premium, if any, and accrued and unpaid interest, if any, on
all the Securities to be due and payable. Upon such a declaration, such
principal, premium and accrued and unpaid interest shall, subject to Section
10.4 of this Indenture, be immediately due and payable. In the event of a
declaration of acceleration of the Securities because an Event of Default set
forth in Section 6.1(6) above has occurred and is continuing, such declaration
of acceleration shall be automatically rescinded and annulled if the event of
default or payment default triggering such Event of Default pursuant to Section
6.1(6) shall be remedied or cured by the Company or a Restricted Subsidiary or
waived by the Holders of the relevant Indebtedness within 20 days after the
declaration of acceleration with respect thereto and if (1) the annulment of the
acceleration of the Securities would not conflict with any judgment or decree of
a court of competent jurisdiction and (2) all existing Events of Default, other
than the nonpayment of principal, premium or interest on the Securities that has
become due solely because of such acceleration, have been cured or waived. If an
Event of Default specified in Section 6.1(7) or (8) with respect to the Company
occurs and is continuing, the principal of, premium, if any, and accrued and
unpaid interest on all the Securities will become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holders. No such rescission shall affect any subsequent Default or Event of
Default or impair any right consequent thereto.
SECTION 6.3. Other Remedies. If an Event of Default occurs and
is continuing, the Trustee may pursue any available remedy to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
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The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.4. Waiver of Past Defaults. The Holders of a
majority in principal amount of the outstanding Securities by notice to the
Trustee may (a) waive an existing Default or Event of Default and its
consequences except a Default or Event of Default in the payment of the
principal of, or premium, if any, or interest on a Security and (b) rescind any
such acceleration with respect to the Securities and its consequences if (1)
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction and (2) all existing Events of Default, other than the
nonpayment of the principal of, premium, if any, and interest on the Securities
that have become due solely by such declaration of acceleration, have been cured
or waived. When a Default or Event of Default is waived, it is deemed cured, but
no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any consequent right.
SECTION 6.5. Control by Majority. 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 of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Sections 7.1 and 7.2, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or would involve the Trustee
in personal liability; provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to indemnification satisfactory to it in its sole discretion against all losses
and expenses caused by taking or not taking such action.
SECTION 6.6. Limitation on Suits. Subject to the provisions of
this Indenture relating to the duties of the Trustee, if an Event of Default
occurs and is continuing, the Trustee will be under no obligation to exercise
any of the rights or powers under this Indenture at the request or direction of
any of the Holders unless such Holders have offered to the Trustee reasonable
indemnity or security against any loss, liability or expense. Except to enforce
the right to receive payment of principal, premium, if any, or interest when
due, no Holder may pursue any remedy with respect to this Indenture or the
Securities unless:
(1) such Holder has previously given the Trustee notice
that an Event of Default is continuing;
(2) Holders of at least 25% in principal amount of the
outstanding Securities have requested the Trustee to pursue the remedy;
(3) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense;
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(4) the Trustee has not complied with such request within
60 days after the receipt of the request and the offer of security or
indemnity; and
(5) the Holders of a majority in principal amount of the
outstanding Securities have not given the Trustee a direction that, in
the opinion of the Trustee, is inconsistent with such request within
such 60-day period.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
SECTION 6.7. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture (including, without
limitation, Section 6.6), the right of any Holder to receive payment of
principal of, premium (if any) or interest on the Securities held by such
Holder, on or after the respective due dates expressed in the Securities, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.8. Collection Suit by Trustee. If an Event of
Default specified in Section 6.1(1) or (2) occurs and is continuing, the Trustee
may recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount then due and owing (together with interest on
any unpaid interest to the extent lawful) and the amounts provided for in
Section 7.7.
SECTION 6.9. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its Subsidiaries or
their respective creditors or properties and, unless prohibited by law or
applicable regulations, may vote on behalf of the Holders in any election of a
trustee in bankruptcy or other Person performing similar functions, and any
Custodian in any such judicial proceeding is hereby authorized by each Holder to
make payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 7.7.
SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article VI, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to holders of Senior Indebtedness to the extent
required by Article X;
THIRD: to Securityholders 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
FOURTH: to the Company.
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The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section. At least 15 days before
such record date, the Company shall mail to each Securityholder and the Trustee
a notice that states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to
Section 6.7 or a suit by Holders of more than 10% in outstanding principal
amount of the Securities.
ARTICLE VII
Trustee
SECTION 7.1. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, in the case of any such certificates or
opinions which by any provisions hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine such certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own wilful misconduct,
except that:
(1) this paragraph does not limit the effect of paragraph
(b) of this Section;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
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(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 6.5.
(d) Every provision of this Indenture that in any way
relates to the Trustee is subject to paragraphs (a), (b) and (c) of
this Section.
(e) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with
the Company.
(f) Money held in trust by the Trustee need not be
segregated from other funds except to the extent required by law.
(g) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds to believe that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section and to the
provisions of the TIA.
(i) Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from the Company
shall be sufficient if signed by an Officer of the Company.
(j) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders unless such Holders shall
have offered to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities that might be incurred by it in
compliance with such request or direction.
SECTION 7.2. Rights of Trustee. (a) Subject to Section 7.1,
the Trustee may rely on any document believed by it to be genuine and to have
been signed or presented by the proper person. The Trustee need not investigate
any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
an Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Trustee's conduct does not
constitute wilful misconduct or negligence.
(e) The Trustee may consult with counsel of its selection, and
the advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall
78
be full and complete authorization and protection from liability in respect to
any action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
SECTION 7.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.4. 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 in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.5. Notice of Defaults. If a Default or Event of
Default occurs and is continuing and if a Trust Officer has actual knowledge
thereof, the Trustee shall mail to each Securityholder notice of the Default or
Event of Default within 90 days after it occurs. Except in the case of a Default
or Event of Default in payment of principal of, premium (if any), or interest on
any Security (including payments pursuant to the optional redemption or required
repurchase provisions of such Security, if any), the Trustee may withhold the
notice if and so long as its board of directors, a committee of its board of
directors or a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Securityholders.
SECTION 7.6. Reports by Trustee to Holders. As promptly as
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of such May 15 that
complies with TIA Section 313(a). The Trustee also shall comply with TIA Section
313(b). The Trustee shall also transmit by mail all reports required by TIA
Section 313(c).
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange (if any) on
which the Securities are listed. The Company agrees to notify promptly the
Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof.
SECTION 7.7. Compensation and Indemnity. The Company and the
Subsidiary Guarantors shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, costs of preparing and reviewing reports,
certificates and other documents, costs of preparation and mailing of notices to
Securityholders and reasonable costs of counsel retained by the Trustee in
connection with the delivery of an Opinion of Counsel or otherwise, in addition
to the compensation for its services. Such expenses shall include the
79
reasonable compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. The Company shall indemnify
the Trustee against any and all loss, liability or expense (including reasonable
attorneys' fees and expenses) incurred by it without negligence or bad faith on
its part in connection with the administration of this trust and the performance
of its duties hereunder, including the costs and expenses of enforcing this
Indenture (including this Section 7.7) and of defending itself against any
claims (whether asserted by any Securityholder, the Company or otherwise). The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim and the
Trustee may have separate counsel and the Company shall pay the fees and
expenses of such counsel provided that the Company shall not be required to pay
such fees and expenses if it assumes the Trustee's defense, and, in the
reasonable judgment of outside counsel to the Trustee, there is no conflict of
interest between the Company and the Trustee in connection with such defense.
The Company need not reimburse any expense or indemnify against any loss,
liability or expense incurred by the Trustee through the Trustee's own wilful
misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section,
the Trustee shall have a lien prior to the Securities on all money or property
held or collected by the Trustee other than money or property held in trust to
pay principal of and interest on particular Securities. The Trustee's right to
receive payment of any amounts due under this Section 7.7 shall not be
subordinate to any other liability or Indebtedness of the Company.
The Company's payment obligations pursuant to this Section
shall survive the discharge of this Indenture. When the Trustee incurs expenses
after the occurrence of a Default specified in Section 6.1(7) or (8) with
respect to the Company, the expenses are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.8. Replacement of Trustee. The Trustee may resign at
any time by so notifying the Company. The Holders of a majority in principal
amount of the Securities may remove the Trustee by so notifying the Trustee and
may appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting as
trustee hereunder.
If the Trustee resigns or is removed by the Company or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee, or if a vacancy exists in
the office of the Trustee for any reason (the
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Trustee in such event being referred to herein as the retiring Trustee), the
Company shall promptly appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.7.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee or the
Holders of 10% in principal amount of the Securities may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to
this Section, the Company's obligations under Section 7.7 shall continue for the
benefit of the retiring Trustee.
SECTION 7.9. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture, any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall
at all times satisfy the requirements of TIA Section 310(a). The Trustee shall
have a combined capital and surplus of at least $100 million as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
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SECTION 7.11. Preferential Collection of Claims Against
Company. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.1. Discharge of Liability on Securities; Defeasance.
(a) Subject to Section 8.1(c), when (i)(x) the Company delivers to the Trustee
all outstanding Securities (other than Securities replaced pursuant to Section
2.9) for cancellation or (y) all outstanding Securities not theretofore
delivered for cancellation have become due and payable, whether at maturity or
upon redemption or will become due and payable within one year or are to be
called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name and at
the expense of the Company and the Company or any Subsidiary Guarantor
irrevocably deposits or causes to be deposited with the Trustee as trust funds
in trust solely for the benefit of the Holders money in U.S. dollars,
non-callable U.S. Government Obligations, or a combination thereof, in such
amounts as will be sufficient without consideration of any reinvestment of
interest to pay and discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation for principal, premium, if
any, and accrued interest to the date of maturity or redemption, (ii) no Default
or Event of Default shall have occurred and be continuing on the date of such
deposit or shall occur as a result of such deposit and such deposit will not
result in a breach or violation of, or constitute a default under, any other
instrument to which the Company or any Subsidiary Guarantor is a party or by
which the Company or any Guarantor is bound; (iii) the Company or any Subsidiary
Guarantor has paid or caused to be paid all sums payable by it under this
Indenture and the Securities; and (iv) the Company has delivered irrevocable
instructions to the Trustee under this Indenture to apply the deposited money
toward the payment of such Securities at maturity or the Redemption Date, as the
case may be, then the Trustee shall acknowledge satisfaction and discharge of
this Indenture on demand of the Company (accompanied by an Officers' Certificate
and an Opinion of Counsel stating that all conditions precedent specified herein
relating to the satisfaction and discharge of this Indenture have been complied
with) and at the cost and expense of the Company.
(b) Subject to Sections 8.1(c) and 8.2, the Company at any
time may terminate (i) all its obligations under the Securities and this
Indenture ("legal defeasance option") or (ii) its obligations under Sections
3.2, 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.19, and 4.1(3)
and the Company may omit to comply with and shall have no liability in respect
of any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.1(3) and 6.1(4) and
the operation of Sections 6.1(6), 6.1(7) (but only with respect to a Significant
Subsidiary), 6.1(8) (but only with respect to a Significant Subsidiary), 6.1(9)
and 6.1(10), and the events specified in such Sections shall no longer
constitute an Event of Default (clauses (ii) being referred to as the
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"covenant defeasance option"), but except as specified above, the remainder of
this Indenture and the Securities shall be unaffected thereby. The Company may
exercise its legal defeasance option notwithstanding its prior exercise of its
covenant defeasance option. If the Company exercises its covenant defeasance
option, the Company may, by written notice to the Trustee prior to the delivery
of the Opinion of Counsel referred to in Section 8.2(9), elect to have any
Subsidiary Guarantees in effect at such time terminate.
If the Company exercises its legal defeasance option, payment
of the Securities may not be accelerated because of an Event of Default and the
Subsidiary Guarantees in effect at such time shall terminate. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Sections 6.1(4), 6.1(5),
6.1(6), 6.1(7) (but only with respect to a Significant Subsidiary), 6.1(8) (but
only with respect to a Significant Subsidiary), 6.1(9) and 6.1(10) or because of
the failure of the Company to comply with Section 4.1(3).
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding the provisions of Sections 8.1(a) and (b),
the Company's obligations in Sections 2.3, 2.4, 2.5, 2.6, 2.7, 2.9, 2.10, 2.11,
2.12, 3.1, 3.14, 3.15, 3.17, 3.18, 6.7, 7.7, 7.8, and in this Article VIII shall
survive until the Securities have been paid in full. Thereafter, the Company's
obligations in Sections 7.7, 8.4 and 8.5 shall survive.
SECTION 8.2. Conditions to Defeasance. The Company may
exercise its legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the
Trustee for the benefit of the Holders money in U.S. dollars or U.S.
Government Obligations or a combination thereof for the payment of
principal of and interest on the Securities to maturity or redemption,
as the case may be;
(2) the Company delivers to the Trustee a certificate
from a nationally recognized firm of independent accountants expressing
their opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be sufficient to pay principal and interest
when due on all the Securities to maturity;
(3) no Default or Event of Default shall have occurred
and be continuing on the date of such deposit (other than a Default or
Event of Default with respect to this Indenture resulting from the
incurrence of Indebtedness, all or a portion of which will be used to
defease the Securities concurrently with such incurrence);
(4) such legal defeasance or covenant defeasance shall
not result in a breach or violation of or constitute a Default under
this Indenture or any other material
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agreement or instrument to which the Company or any of its Subsidiaries
is a party or by which the Company or any of its Subsidiaries is bound;
(5) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that (A) the Securities and (B)
assuming no intervening bankruptcy of the Company between the date of
deposit and the 91st day following the deposit and that no Holder of
the Securities is an insider of the Company, after 91st day following
the deposit, the trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' right generally;
(6) the deposit does not constitute a default under any
other agreement binding on the Company and is not prohibited by Article
X;
(7) the Company delivers to the Trustee an Opinion of
Counsel to the effect that the trust resulting from the deposit does
not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(8) in the case of the legal defeasance option, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (ii) since the
date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Securityholders
will not recognize income, gain or loss for Federal income tax purposes
as a result of such deposit and defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such deposit and legal
defeasance had not occurred;
(9) in the case of the covenant defeasance option, the
Company shall have delivered to the Trustee an Opinion of Counsel in
the United States to the effect that the Securityholders will not
recognize income, gain or loss for Federal income tax purposes as a
result of such deposit and covenant defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such deposit and covenant
defeasance had not occurred; and
(10) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance and discharge of the Securities and this
Indenture as contemplated by this Article VIII have been complied with.
SECTION 8.3. Application of Trust Money. The Trustee shall
hold in trust money or U.S. Government Obligations deposited with it pursuant to
this Article VIII. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal of and interest on the Securities. Money
and securities so held in trust are not subject to Article X.
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SECTION 8.4. Repayment to Company. The Trustee and the Paying
Agent shall promptly turn over to the Company upon request any excess money or
securities held by them upon payment of all the obligations under this
Indenture.
Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Company upon request any money held by
them for the payment of principal of or interest on the Securities that remains
unclaimed for two years, and, thereafter, Securityholders entitled to the money
must look to the Company for payment as general creditors.
SECTION 8.5. Indemnity for U.S. Government Obligations. The
Company shall pay and shall indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government Obligations.
SECTION 8.6. Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Article VIII 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 obligations of the Company under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article VIII until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article VIII; provided, however, that, if
the Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX
Amendments
SECTION 9.1. Without Consent of Holders. The Company, the
Subsidiary Guarantors and the Trustee may amend this Indenture or the Securities
without notice to or consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to comply with Article IV in respect of the
assumption by a Successor Company of an obligation of the Company or
any Subsidiary Guarantor under this Indenture;
(3) to provide for uncertificated Securities in addition
to or in place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
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(4) to add Guarantees with respect to the Securities or
release a Subsidiary Guarantor upon its designation as an Unrestricted
Subsidiary; provided, however, that the designation is in accord with
the applicable provisions of this Indenture;
(5) to secure the Securities;
(6) to add to the covenants of the Company for the
benefit of the Holders or to surrender any right or power herein
conferred upon the Company;
(7) to make any change that does not adversely affect the
rights of any Securityholder;
(8) to comply with any requirements of the SEC in
connection with qualifying this Indenture under the TIA;
(9) to provide for the issuance of the Exchange
Securities, which will have terms substantially identical in all
respects to the Initial Securities (except that the transfer
restrictions contained in the Initial Securities will be modified or
eliminated, as appropriate), and which will be treated, together with
any outstanding Initial Securities, as a single issue of securities; or
(10) to make any change in the subordination provisions of
this Indenture that would limit or terminate the benefits available to
any holder of Senior Indebtedness of the Company or a holder of
Guarantor Senior Indebtedness (or any Representative thereof) under
such subordination provisions.
An amendment under this Section may not make any change that
adversely affects the rights under Article X or Article XII of any holder of
Senior Indebtedness or Guarantor Senior Indebtedness then outstanding unless the
holders of such Senior Indebtedness or Guarantor Senior Indebtedness (or any
group or representative thereof authorized to give a consent) consent to such
change.
After an amendment under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.
SECTION 9.2. With Consent of Holders. The Company and the
Trustee may amend this Indenture or the Securities without notice to any
Securityholder but with the written consent of the Holders of at least a
majority in principal amount of the Securities. However, without the consent of
each Securityholder affected, an amendment may not:
(1) reduce the amount of Securities whose Holders must
consent to an amendment;
(2) reduce the stated rate of or extend the time for
payment of interest on any Security;
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(3) reduce the principal of or extend the Stated Maturity
of any Security;
(4) reduce the premium payable upon the redemption of any
Security or change the time at which any Security may be redeemed in
accordance with this Indenture;
(5) make any Security payable in money other than that
stated in the Security;
(6) impair the right of any Holder to receive payment of
principal of, premium, if any, and interest on such Holder's Securities
on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such Holder's
Securities;
(7) make any change to the amendment provisions which
require each Holder's consent or to the waiver provisions; or
(8) modify the Subsidiary Guarantees in any manner
adverse to the Holders of the Securities.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.
SECTION 9.3. Compliance with Trust Indenture Act. Every
amendment to this Indenture or the Securities shall comply with the TIA as then
in effect.
SECTION 9.4. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. After an
amendment or waiver becomes effective, it shall bind every Securityholder. An
amendment or waiver shall become effective upon receipt by the Trustee of the
requisite number of written consents under Section 9.2.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons,
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shall be entitled to give such consent or to revoke any consent previously given
or to take any such action, whether or not such Persons continue to be Holders
after such record date. No such consent shall become valid or effective more
than 120 days after such record date.
SECTION 9.5. Notation on or Exchange of Securities. If an
amendment changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.6. Trustee To Sign Amendments. The Trustee shall
sign any amendment authorized pursuant to this Article IX if the amendment does
not adversely affect the rights, duties, liabilities or immunities of the
Trustee. If it does, the Trustee may but need not sign it. In signing such
amendment the Trustee shall be entitled to receive indemnity reasonably
satisfactory to it and to receive, and (subject to Sections 7.1 and 7.2) shall
be fully protected in relying upon, an Officers' Certificate and an Opinion of
Counsel stating that such amendment is authorized or permitted by this
Indenture.
ARTICLE X
Subordination
SECTION 10.1. Agreement To Subordinate. The Company agrees,
and each Securityholder by accepting a Security agrees, that the Indebtedness
evidenced by the Securities and other obligations relating to the Securities are
subordinated in right of payment, to the extent and in the manner provided in
this Article X, to the prior payment when due in cash or Cash Equivalents of all
Senior Indebtedness and that the subordination is for the benefit of and
enforceable by the holders of Senior Indebtedness. The Securities shall in all
respects rank pari passu with all other Senior Subordinated Indebtedness of the
Company and only Indebtedness of the Company which is Senior Indebtedness will
rank senior to the Securities in accordance with the provisions set forth
herein. All provisions of this Article X shall be subject to Section 10.12.
SECTION 10.2. Liquidation, Dissolution, Bankruptcy. Upon any
payment or distribution of the assets or securities of the Company upon a total
or partial liquidation or a total or partial dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its respective properties:
(1) holders of Senior Indebtedness of the Company shall
be entitled to receive payment in full in cash or Cash Equivalents of
the Senior Indebtedness (including interest accruing after, or which
would accrue but for, the commencement of any proceeding at the rate
specified in the applicable Senior Indebtedness, whether or not a claim
for such interest would be allowed) before Securityholders shall be
entitled to receive any payment of principal of or interest on or other
amounts with respect to the Securities; and
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(2) until the Senior Indebtedness is paid in full in cash
or Cash Equivalents, any payment or distribution to which
Securityholders would be entitled but for this Article X shall be made
to holders of Senior Indebtedness as their respective interests may
appear.
SECTION 10.3. Default on Senior Indebtedness. The Company
shall not pay the principal of, premium (if any) or interest on or other amounts
with respect to the Securities or make any deposit pursuant to Section 8.1 or
repurchase, redeem or otherwise retire any Securities ("pay the Securities") if
(i) any Senior Indebtedness of the Company is not paid when due in cash or Cash
Equivalents or (ii) any other default on Senior Indebtedness of the Company
occurs and the maturity of such Senior Indebtedness of the Company is
accelerated in accordance with its terms unless, in either case, (x) the default
has been cured or waived and any such acceleration has been rescinded in writing
or (y) such Senior Indebtedness of the Company has been paid in full in cash or
Cash Equivalents; provided, however, that the Company may pay the Securities
without regard to the foregoing if the Company and the Trustee receive written
notice approving such payment from the Representative of the Senior Indebtedness
of the Company with respect to which either of the events set forth in clause
(i) or (ii) of this sentence has occurred or is continuing. During the
continuance of any default (other than a default described in clause (i) or (ii)
of the preceding sentence) with respect to any Designated Senior Indebtedness
pursuant to which the maturity thereof may be accelerated immediately without
further notice (except such notice as may be required to effect such
acceleration) or the expiration of any applicable grace periods, the Company may
not pay the Securities for a period (a "Payment Blockage Period") commencing
upon the receipt by the Trustee (with a copy to the Company) of written notice
(a "Blockage Notice") of such default from the Representative of the holders of
such Designated Senior Indebtedness specifying an election to effect a Payment
Blockage Period and ending 179 days thereafter (or earlier if such Payment
Blockage Period is terminated (i) by written notice to the Trustee and the
Company from the Person or Persons who gave such Blockage Notice, (ii) because
the default giving rise to such Blockage Notice is no longer continuing or (iii)
because such Designated Senior Indebtedness has been repaid in full in cash or
Cash Equivalents). Notwithstanding the provisions of the immediately preceding
sentence, unless the holders of such Designated Senior Indebtedness or the
Representative of such holders shall have accelerated the maturity of such
Designated Senior Indebtedness or some other event requiring blockage has
occured, the Company may resume payments on the Securities after the end of such
Payment Blockage Period (including any missed payments). Not more than one
Blockage Notice may be given in any consecutive 360-day period, irrespective of
the number of defaults with respect to Designated Senior Indebtedness during
such period. In no event, however, may the total number of days during which any
Payment Blockage Period or Periods is in effect exceed 179 days in the aggregate
during any 360 consecutive day period. For purposes of this paragraph, no
default or event of default that existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to the Designated
Senior Indebtedness initiating such Payment Blockage Period shall be, or be
made, the basis of the commencement of a subsequent Payment Blockage Period by
the Representative of such Designated Senior Indebtedness, whether or not within
a period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
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SECTION 10.4. Acceleration of Payment of Securities. If
payment of the Securities is accelerated because of an Event of Default, the
Company or the Trustee shall promptly notify the holders of the Designated
Senior Indebtedness (or their Representatives) of the acceleration; provided,
however, that the Company and the Trustee shall be obligated to notify such a
Representative only if such Representative has delivered or caused to be
delivered to the Company and the Trustee an address for service of such a notice
(and the Company and the Trustee shall only be obligated to deliver the notice
to the address so specified). If any Designated Senior Indebtedness is
outstanding, the Company shall not pay the Securities until five Business Days
after the holders or Representative of such Designated Senior Indebtedness
receives notice of such acceleration and, thereafter, may pay the Securities
only if this Article X otherwise permits payments at that time.
SECTION 10.5. When Distribution Must Be Paid Over. If a
payment or distribution is made to the Trustee or Securityholders that because
of this Article X should not have been made to them, the Trustee or the
Securityholders who receive the payment or distribution shall hold it in trust
for holders of Senior Indebtedness and promptly pay it over to them as their
respective interests may appear.
SECTION 10.6. Subrogation. After all Senior Indebtedness is
paid in full in cash or Cash Equivalents and until the Securities are paid in
full, Securityholders shall be subrogated to the rights of holders of Senior
Indebtedness to receive distributions applicable to Senior Indebtedness. A
payment or distribution made under this Article X to holders of Senior
Indebtedness which otherwise would have been made to Securityholders is not, as
between the Company and Securityholders, a payment by the Company of Senior
Indebtedness.
SECTION 10.7. Relative Rights. This Article X defines the
relative rights of Securityholders and holders of Senior Indebtedness. Nothing
in this Indenture shall:
(1) impair, as between the Company and Securityholders,
the obligation of the Company which is absolute and unconditional, to
pay principal of and interest on the Securities in accordance with
their terms; or
(2) prevent the Trustee or any Securityholder from
exercising its available remedies upon a Default or Event of Default,
subject to the rights of holders of Senior Indebtedness to receive
payments and distributions otherwise payable to Securityholders.
SECTION 10.8. Subordination May Not Be Impaired by Company. No
right of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Securities shall be impaired by any act or failure
to act by the Company or by the failure of any of them to comply with this
Indenture.
SECTION 10.9. Rights of Trustee and Paying Agent.
Notwithstanding Section 10.3, the Trustee or Paying Agent may continue to make
payments on the Securities and shall not be charged with knowledge of the
existence of facts that would prohibit the making of any such payments unless,
not less than one Business Day prior to the date of such payment, a Trust
Officer of the Trustee receives notice satisfactory to it that payments may not
be made under this
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Article X. The Company, the Registrar or co-registrar, the Paying Agent, a
Representative or a holder of Senior Indebtedness may give the notice; provided,
however, that, if an issue of Senior Indebtedness has a Representative, only the
Representative may give the notice.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were not Trustee.
The Registrar and co-registrar and the Paying Agent may do the same with like
rights. The Trustee shall be entitled to all the rights set forth in this
Article X with respect to any Senior Indebtedness which may at any time be held
by it, to the same extent as any other holder of Senior Indebtedness; and
nothing in Article VII shall deprive the Trustee of any of its rights as such
holder. Nothing in this Article X shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 7.7. Each Paying Agent shall have the same
rights and obligations under this Article X as does the Trustee.
SECTION 10.10. Distribution or Notice to Representative.
Whenever a payment or distribution is to be made or a notice given to holders of
Senior Indebtedness, the payment or distribution may be made and the notice
given to their Representative (if any).
SECTION 10.11. Article X Not To Prevent Events of Default or
Limit Right To Accelerate. The failure to make a payment in respect of the
Securities by reason of any provision in this Article X shall not be construed
as preventing the occurrence of a Default or Event of Default. Nothing in this
Article X shall have any effect on the right of the Securityholders or the
Trustee to accelerate the maturity of the Securities.
SECTION 10.12. Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article VIII by the Trustee
for the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Senior Indebtedness or subject to the
restrictions set forth in this Article X, and none of the Securityholders shall
be obligated to pay over any such amount to the Company, any holder of Senior
Indebtedness of the Company, or any other creditor of the Company.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or
distribution pursuant to this Article X, the Trustee and the Securityholders
shall be entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 10.2
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Trustee or to the
Securityholders or (iii) upon the Representatives for the holders of Senior
Indebtedness for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article X. In the event that the Trustee determines, in good faith, that
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article X, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and other facts pertinent to the rights of such
Person under this
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Article X, and, if such evidence is not furnished, the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections 7.1 and 7.2 shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article X.
SECTION 10.14. Trustee To Effectuate Subordination. Each
Securityholder by accepting a Security authorizes and directs the Trustee on its
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Securityholders and the holders of
Senior Indebtedness as provided in this Article X and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and, subject to Section 10.9, shall not be liable
to any such holders if it shall mistakenly pay over or distribute to
Securityholders or the Company or any other Person, money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article X or
otherwise.
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Securityholder by accepting a Security
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness, whether such Senior Indebtedness was created or acquired before or
after the issuance of the Securities, to acquire and continue to hold, or to
continue to hold, such Senior Indebtedness and such holder of Senior
Indebtedness shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold, or in continuing to hold, such
Senior Indebtedness.
ARTICLE XI
Subsidiary Guarantee
SECTION 11.1. Subsidiary Guarantee
Each Subsidiary Guarantor hereby fully, unconditionally and
irrevocably guarantees, as primary obligor and not merely as surety, jointly and
severally with each other Subsidiary Guarantor, to each Holder of the Securities
the full and punctual payment when due, whether at maturity, by acceleration, by
redemption or otherwise, of the principal of, premium, if any, and interest on
the Securities and all other obligations of the Company under this Indenture
(all the foregoing being hereinafter collectively called the "Obligations"). The
Guarantor further agrees (to the extent permitted by law) that the Obligations
may be extended or renewed, in whole or in part, without notice or further
assent from it, and that it will remain bound under this Article XI
notwithstanding any extension or renewal of any Obligation.
Each Subsidiary Guarantor waives presentation to, demand of
payment from and protest to the Company of any of the Obligations and also
waives notice of protest for nonpayment. The Guarantor waives notice of any
default under the Securities or the Obligations. The obligations of the
Guarantor hereunder shall not be affected by (a) the failure of any Holder
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to assert any claim or demand or to enforce any right or remedy against the
Company or any other person under this Indenture, the Securities or any other
agreement or otherwise; (b) any extension or renewal of any thereof; (c) any
rescission, waiver, amendment or modification of any of the terms or provisions
of this Indenture, the Securities or any other agreement; (d) the release of any
security held by any Holder or the Trustee for the Obligations or any of them;
(e) the failure of any Holder to exercise any right or remedy against any other
Subsidiary Guarantor; or (f) any change in the ownership of the Company.
Each Subsidiary Guarantor further agrees that its Guarantee
herein constitutes a guarantee of payment when due (and not a guarantee of
collection) and waives any right to require that any resort be had by any Holder
to any security held for payment of the Obligations.
The obligations of each Subsidiary Guarantor hereunder shall
not be subject to any reduction, limitation, impairment or termination for any
reason (other than payment of the Obligations in full), including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Obligations
or otherwise. Without limiting the generality of the foregoing, the obligations
of each Subsidiary Guarantor herein shall not be discharged or impaired or
otherwise affected by the failure of any Holder to assert any claim or demand or
to enforce any remedy under this Indenture, the Securities or any other
agreement, by any waiver or modification of any thereof, by any default, failure
or delay, willful or otherwise, in the performance of the Obligations, or by any
other act or thing or omission or delay to do any other act or thing which may
or might in any manner or to any extent vary the risk of any Subsidiary
Guarantor or would otherwise operate as a discharge of such Subsidiary Guarantor
as a matter of law or equity.
Each Subsidiary Guarantor further agrees that its Subsidiary
Guarantee herein shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of principal of or interest
on any of the Obligations is rescinded or must otherwise be restored by any
Holder upon the bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any
other right which any Holder has at law or in equity against any Subsidiary
Guarantor by virtue hereof, upon the failure of the Company to pay any of the
Obligations when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, each Subsidiary Guarantor hereby
promises to and will, upon receipt of written demand by the Trustee, forthwith
pay, or cause to be paid, in cash, to the Holders an amount equal to the sum of
(i) the unpaid amount of such Obligations then due and owing and (ii) accrued
and unpaid interest on such Obligations then due and owing (but only to the
extent not prohibited by law).
Each Subsidiary Guarantor further agrees that, as between such
Subsidiary Guarantor, on the one hand, and the Holders, on the other hand, (x)
the maturity of the Obligations guaranteed hereby may be accelerated as provided
in this Indenture for the purposes of its Subsidiary Guarantee herein,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed hereby and (y) in the
event of any such declaration of acceleration of such Obligations, such
Obligations (whether or not due
93
and payable) shall forthwith become due and payable by the Subsidiary Guarantor
for the purposes of this Subsidiary Guarantee.
Each Subsidiary Guarantor also agrees to pay any and all
reasonable costs and expenses (including reasonable attorneys' fees and
expenses) incurred by the Trustee or the Holders in enforcing any rights under
this Section.
The Company shall not permit any Subsidiary Guarantor to
consolidate with or merge with or into any Person (other than another Subsidiary
Guarantor) and will not permit the conveyance, transfer or lease of
substantially all of the assets of any Subsidiary Guarantor unless: (1)(a) the
resulting, surviving or transferee Person will be a corporation, partnership,
trust or limited liability company organized and existing under the laws of the
United States of America, any State of the United States or the District of
Columbia and such person (if not such Subsidiary Guarantor) will expressly
assume, by supplemental indenture, executed and delivered to the Trustee, all
the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee; (b)
immediately after giving effect to such transaction (and treating any
indebtedness that becomes an obligation of the resulting, surviving or
transferee Person or any Restricted Subsidiary as a result of such transaction
as having been Incurred by such Person or such Restricted Subsidiary at the time
of such transaction), no Default or Event of Default shall have occurred and be
continuing; and (c) the Company will have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such supplemental indenture, if any, comply with the
Indenture; or (2) the transaction is made in compliance with Section 3.7 of this
Indenture.
SECTION 11.2. Limitation on Liability; Termination, Release
and Discharge
The obligations of each Subsidiary Guarantor hereunder will be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Subsidiary Guarantor (including,
without limitation, any guarantees under the Credit Agreement) and after giving
effect to any collections from or payments made by or on behalf of any other
Subsidiary Guarantor in respect of the obligations of such other Subsidiary
Guarantor under its Subsidiary Guarantee or pursuant to its contribution
obligations under this Indenture or as set forth below, result in the
obligations of such Subsidiary Guarantor under its Subsidiary Guarantee not
constituting a fraudulent conveyance or fraudulent transfer under applicable
federal or state law.
Each Subsidiary Guarantor may consolidate with or merge into
or sell its assets to the Company or another Subsidiary Guarantor without
limitation. Subject to Article III and Article IV, each Subsidiary Guarantor may
consolidate with or merge into or sell all or substantially all its assets to a
corporation, partnership or trust other than the Company or another Subsidiary
Guarantor (whether or not affiliated with the Subsidiary Guarantor) except that
if the surviving corporation of any such merger or consolidation is a Subsidiary
of the Company, such merger, consolidation or sale shall not be permitted unless
(i) the Person formed by or surviving any such consolidation or merger assumes
all the obligations of such Subsidiary under the Subsidiary Guarantee pursuant
to a supplemental indenture in form and substance reasonably satisfactory to the
Trustee in respect of the Securities, this Indenture and the Subsidiary
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Guarantee, (ii) immediately after giving effect to such transaction, no Default
or Event of Default exists; and (iii) the Company delivers to the Trustee an
Officers' Certificate and an Opinion of Counsel complying with Section 13.4 and
13.5 hereof and addressed to the Trustee with respect to the foregoing matters.
Upon the sale or disposition of a Subsidiary Guarantor (by merger,
consolidation, the sale of all or substantially all of its assets) to a Person
(whether or not an Affiliate of the Subsidiary Guarantor) which is not a
Subsidiary of the Company, which sale or disposition is otherwise in compliance
with this Indenture (including Section 3.7), the Guarantor shall be deemed
released from all its obligations under this Indenture and its Subsidiary
Guarantee and its Subsidiary Guarantee shall terminate; provided, however, that
any such termination shall occur only to the extent that all obligations of the
Guarantor under all of its guarantees of, and under all of its pledges of assets
or other security interests which secure, any other Indebtedness of the Company
shall also terminate upon such release, sale or transfer.
A Subsidiary Guarantor will be released from its obligations
under this Indenture and its Subsidiary Guarantee upon the release of a
Guarantee by such Subsidiary Guarantor under the Credit Agreement; provided,
however, that in the event that such Subsidiary Guarantor thereafter guarantees
any Indebtedness of the Company under the Credit Agreement (or if any released
Guarantee under the Credit Agreement is reinstated or renewed), then such
Subsidiary Guarantor will guarantee the Securities on the terms and conditions
as set forth under this Indenture.
A Subsidiary Guarantor will be deemed released and relieved of
its obligations under this Indenture and its Subsidiary Guarantee without any
further action required on the part of the Company or such Subsidiary Guarantor
upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary
in accordance with the terms of this Indenture.
SECTION 11.3. Right of Contribution
Each Subsidiary Guarantor hereby agrees that to the extent
that any Subsidiary Guarantor shall have paid more than its proportionate share
of any payment made on the obligations under the Subsidiary Guarantees, such
Subsidiary Guarantor shall be entitled to seek and receive contribution from and
against the Company or any other Subsidiary Guarantor who has not paid its
proportionate share of such payment. Each Subsidiary Guarantor's right of
contribution shall be subject to the terms and conditions of Section 3.6. The
provisions of this Section 11.3 shall in no respect limit the obligations and
liabilities of each Subsidiary Guarantor to the Trustee and the Holders and each
Subsidiary Guarantor shall remain liable to the Trustee and the Holders for the
full amount guaranteed by such Subsidiary Guarantor hereunder.
SECTION 11.4. No Subrogation
Notwithstanding any payment or payments made by each
Subsidiary Guarantor hereunder, no Subsidiary Guarantor shall be entitled to be
subrogated to any of the rights of the Trustee or any Holder against the Company
or any other Subsidiary Guarantor or any collateral security or guarantee or
right of offset held by the Trustee or any Holder for the payment of the
Obligations, nor shall any Subsidiary Guarantor seek or be entitled to seek any
contribution or reimbursement from the Company or any other Subsidiary Guarantor
in respect of payments
95
made by such Subsidiary Guarantor hereunder, until all amounts owing to the
Trustee and the Holders by the Company on account of the Obligations are paid in
full. If any amount shall be paid to any Subsidiary Guarantor on account of such
subrogation rights at any time when all of the Obligations shall not have been
paid in full, such amount shall be held by such Subsidiary Guarantor in trust
for the Trustee and the Holders, segregated from other funds of such Subsidiary
Guarantor, and shall, forthwith upon receipt by such Subsidiary Guarantor, be
turned over to the Trustee in the exact form received by such Subsidiary
Guarantor (duly indorsed by such Subsidiary Guarantor to the Trustee, if
required), to be applied against the Obligations.
ARTICLE XII
Subordination of Subsidiary Guarantees
SECTION 12.1. Agreement To Subordinate
Each Subsidiary Guarantor agrees, and each Securityholder by
accepting a Security agrees, that the Indebtedness evidenced by, and all other
obligations in respect of, the Securities are subordinated in right of payment,
to the extent and in the manner provided in this Article XII, to the prior
payment when due in cash or Cash Equivalents of all Guarantor Senior
Indebtedness of the applicable Subsidiary Guarantor and that the subordination
is for the benefit of and enforceable by the holders of Guarantor Senior
Indebtedness of the applicable Subsidiary Guarantor. The Subsidiary Guarantees
shall in all respects rank pari passu with all other Guarantor Senior
Subordinated Indebtedness of the Subsidiary Guarantor and only Indebtedness of
the Subsidiary Guarantor that is Guarantor Senior Indebtedness will rank senior
to the Subsidiary Guarantees in accordance with the provisions set forth herein.
All provisions of this Article XII shall be subject to Section 12.12.
SECTION 12.2. Liquidation, Dissolution, Bankruptcy
Upon any payment or distribution of the assets or securities
of any Subsidiary Guarantor upon a total or partial liquidation or a total or
partial dissolution of any Subsidiary Guarantor or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to any
Subsidiary Guarantor or its properties:
(1) holders of Guarantor Senior Indebtedness of such
Subsidiary Guarantor shall be entitled to receive payment in full in
cash or Cash Equivalents of all Guarantor Senior Indebtedness of such
Subsidiary Guarantor (including interest accruing after, or which would
accrue but for, the commencement of any proceeding at the rate
specified in the applicable Guarantor Senior Indebtedness, whether or
not a claim for such interest would be allowed) before Securityholders
shall be entitled to receive any payment of principal of or interest on
or other amounts with respect to the Subsidiary Guarantees from any
Subsidiary Guarantor; and
(2) until the Guarantor Senior Indebtedness of such
Subsidiary Guarantor is paid in full in cash or Cash Equivalents, any
payment or distribution to which Securityholders would be entitled but
for this Article XII shall be made to holders of
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Guarantor Senior Indebtedness of such Subsidiary Guarantor, as their
respective interests may appear.
SECTION 12.3. Default on Senior Indebtedness or Guarantor
Senior Indebtedness
A Subsidiary Guarantor shall not pay the principal of, premium
(if any) or interest on or other payment obligations in respect of the
Subsidiary Guarantees or make any deposit pursuant to Section 8.1 or repurchase,
redeem or otherwise retire the Securities (collectively, "pay the Securities")
if (i) any Senior Indebtedness or Guarantor Senior Indebtedness of the
applicable Subsidiary Guarantor is not paid when due in cash or Cash Equivalents
or (ii) any other default on Senior Indebtedness or Guarantor Senior
Indebtedness of the applicable Subsidiary Guarantor occurs and the maturity of
such Senior Indebtedness or Guarantor Senior Indebtedness is accelerated in
accordance with its terms unless, in either case, (x) the default has been cured
or waived and any such acceleration has been rescinded in writing or (y) such
Senior Indebtedness or Guarantor Senior Indebtedness of the applicable
Subsidiary Guarantor has been paid in full in cash or Cash Equivalents;
provided, however, that each Subsidiary Guarantor may pay the Securities without
regard to the foregoing if the Company and the Trustee receive written notice
approving such payment from the Representative of the Senior Indebtedness or
Guarantor Senior Indebtedness of the applicable Subsidiary Guarantor with
respect to which either of the events set forth in clause (i) or (ii) of this
sentence has occurred and is continuing. No Subsidiary Guarantor may pay the
Securities during any Payment Blockage Period (as defined in Section 10.3).
Notwithstanding the provisions of the immediately preceding sentence, unless the
holders of the applicable Designated Senior Indebtedness or the
Representative(s) of such holders shall have accelerated the maturity of such
Designated Senior Indebtedness or some other event requiring blockage has
occured, such Subsidiary Guarantor may resume payments on the Securities after
the end of such Payment Blockage Period (including any missed payments).
SECTION 12.4. Acceleration of Payment of Securities
If payment of the Securities is accelerated because of an
Event of Default and if any Designated Senior Indebtedness is outstanding, each
Subsidiary Guarantor shall not pay the Securities until five Business Days after
the holders or Representative(s) of such Designated Senior Indebtedness receives
notice of such acceleration and, thereafter, may pay the Securities, only if
this Article XII otherwise permits payments at that time.
SECTION 12.5. When Distribution Must Be Paid Over
If a payment or distribution is made to Trustee or
Securityholders that because of this Article XII should not have been made to
them, the Trustee or Securityholders who receive the payment or distribution
shall hold it in trust for holders of Guarantor Senior Indebtedness of the
applicable Subsidiary Guarantor and promptly pay it over to them as their
respective interests may appear.
SECTION 12.6. Subrogation
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After all Guarantor Senior Indebtedness is paid in full in
cash or Cash Equivalents and until the Securities are paid in full in cash or
Cash Equivalents, Securityholders shall be subrogated to the rights of holders
of Guarantor Senior Indebtedness to receive distributions applicable to
Guarantor Senior Indebtedness. A payment or distribution made under this Article
XII to holders of Guarantor Senior Indebtedness which otherwise would have been
made to Securityholders is not, as between the Subsidiary Guarantors and
Securityholders, a payment by the Subsidiary Guarantors of Guarantor Senior
Indebtedness.
SECTION 12.7. Relative Rights
This Article XII defines the relative rights of
Securityholders and holders of Guarantor Senior Indebtedness. Nothing in this
Indenture shall:
(1) impair, as between Subsidiary Guarantor and
Securityholders, the obligation of each Subsidiary Guarantor which is
absolute and unconditional, to guarantee the payment of principal of
and interest on the Securities in accordance with their terms; or
(2) prevent the Trustee or any Securityholder from
exercising its available remedies upon a Default or Event of Default,
subject to the rights of holders of Guarantor Senior Indebtedness to
receive payments and distributions otherwise payable to
Securityholders.
SECTION 12.8. Subordination May Not Be Impaired by Subsidiary
Guarantors
No right of any holder of Guarantor Senior Indebtedness to
enforce the subordination of the Indebtedness evidenced by the Subsidiary
Guarantees shall be impaired by any act or failure to act by any Subsidiary
Guarantor or by the failure of any of them to comply with this Indenture.
SECTION 12.9. Rights of Trustee and Paying Agent
Notwithstanding Section 12.3, the Trustee or Paying Agent may
continue to make payments on the Securities and shall not be charged with
knowledge of the existence of facts that would prohibit the making of any such
payments unless, not less than one Business Day prior to the date of such
payment, a Trust Officer of the Trustee receives notice in writing satisfactory
to it that payments may not be made under this Article XII. Each Subsidiary
Guarantor, the Registrar or co-registrar, the Paying Agent, a Representative or
a holder of Senior Indebtedness may give the notice; provided, however, that, if
an issue of Guarantor Senior Indebtedness has a Representative, only the
Representative may give the notice.
The Trustee in its individual or any other capacity may hold
Guarantor Senior Indebtedness with the same rights it would have if it were not
Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article XII with respect to any Guarantor Senior Indebtedness which may at
any time be held by it, to the same extent as any other holder of Guarantor
Senior
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Indebtedness; and nothing in Article VII shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article XII shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.7. Each Paying Agent
shall have the same rights and obligations under this Article XII as does the
Trustee.
SECTION 12.10. Distribution or Notice to Representative
Whenever a payment or distribution is to be made or a notice
given to holders of Guarantor Senior Indebtedness, the payment or distribution
may be made and the notice given to their Representative (if any).
SECTION 12.11. Article XII Not To Prevent Events of Default or
Limit Right To Accelerate
The failure to make a payment in respect of the Securities and
the Subsidiary Guarantees, by reason of any provision in this Article XII shall
not be construed as preventing the occurrence of a Default or Event of Default.
Nothing in this Article XII shall have any effect on the right of the
Securityholders or the Trustee to accelerate the maturity of the Securities.
SECTION 12.12. Trust Moneys Not Subordinated
Notwithstanding anything contained herein to the contrary,
payments from money or the proceeds of U.S. Government Obligations held in trust
under Article VIII by the Trustee for the payment of principal of and interest
on the Securities or the Subsidiary Guarantees shall not be subordinated to the
prior payment of any Guarantor Senior Indebtedness or subject to the
restrictions set forth in this Article XII, and none of the Securityholders
shall be obligated to pay over any such amount to the Company, any holder of
Guarantor Senior Indebtedness, or any other creditor of such Subsidiary
Guarantor.
SECTION 12.13. Trustee Entitled To Rely
Upon any payment or distribution pursuant to this Article XII,
the Trustee and the Securityholders shall be entitled to rely (i) upon any order
or decree of a court of competent jurisdiction in which any proceedings of the
nature referred to in Section 12.2 are pending, (ii) upon a certificate of the
liquidating trustee or agent or other Person making such payment or distribution
to the Trustee or to the Securityholders or (iii) upon the Representatives for
the holders of Guarantor Senior Indebtedness for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Guarantor Senior Indebtedness and other Indebtedness of each Subsidiary
Guarantor, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
XII. In the event that the Trustee determines, in good faith, that evidence is
required with respect to the right of any Person as a holder of Guarantor Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article XII, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Guarantor Senior
Indebtedness held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and other facts pertinent to the
rights of such Person
99
under this Article XII, and, if such evidence is not furnished, the Trustee may
defer any payment to such Person pending judicial determination as to the right
of such Person to receive such payment. The provisions of Sections 7.1 and 7.2
shall be applicable to all actions or omissions of actions by the Trustee
pursuant to this Article XII.
SECTION 12.14. Trustee To Effectuate Subordination
Each Securityholder by accepting a Security authorizes and
directs the Trustee on its behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination between the
Securityholders and the holders of Guarantor Senior Indebtedness as provided in
this Article XII and appoints the Trustee as attorney-in-fact for any and all
such purposes.
SECTION 12.15. Trustee Not Fiduciary for Holders of Guarantor
Senior Indebtedness
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Guarantor Senior Indebtedness and, subject to Section 12.9, shall
not be liable to any such holders if it shall mistakenly pay over or distribute
to Securityholders or any Subsidiary Guarantor or any other Person, money or
assets to which any holders of Guarantor Senior Indebtedness shall be entitled
by virtue of this Article XII or otherwise.
SECTION 12.16. Reliance by Holders of Guarantor Senior
Indebtedness on Indebtedness on Subordination Provisions
Each Securityholder by accepting a Security acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration to each holder of any Guarantor Senior
Indebtedness, whether such Guarantor Senior Indebtedness was created or acquired
before or after the issuance of the Securities, to acquire and continue to hold,
or to continue to hold, such Guarantor Senior Indebtedness and such holder of
Guarantor Senior Indebtedness shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.
ARTICLE XIII
Miscellaneous
SECTION 13.1. Trust Indenture Act Controls. If any provision
of this Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the provision required by
the TIA shall control.
SECTION 13.2. Notices. Any notice or communication shall be in
writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company:
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Nebraska Book Company, Inc.
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx
With a copy to:
Xxxxxxx XxXxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
if to the Trustee:
BNY Midwest Trust Company
Xxx Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
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 to a Securityholder shall
be mailed to the Securityholder at the Securityholder's address as it appears on
the registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.3. Communication by Holders with other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 13.4. Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Company to the Trustee to take
or refrain from taking any action under this Indenture, the Company shall
furnish to the Trustee:
(1) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee stating that, in the opinion of
the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
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SECTION 13.5. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture shall include:
(1) a statement that the individual making such
certificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of
such individual, such covenant or condition has been complied with.
In giving such Opinion of Counsel, counsel may rely as to
factual matters on an Officer's Certificate or on certificates of public
officials.
SECTION 13.6. When Securities Disregarded. In determining
whether the Holders of the required principal amount of Securities have
concurred in any direction, waiver or consent, Securities owned by the Company
or by any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company shall be disregarded and
deemed not to be outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities which the Trustee knows are so owned shall be so
disregarded. Also, subject to the foregoing, only Securities outstanding at the
time shall be considered in any such determination.
SECTION 13.7. Rules by Trustee, Paying Agent and Registrar.
The Trustee may make reasonable rules for action by, or a meeting of,
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 13.8. Legal Holidays. A "Legal Holiday" is a Saturday,
a Sunday or other day on which commercial banking institutions are authorized or
required to be closed in New York City. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.
SECTION 13.9. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
SECTION 13.10. No Recourse Against Others. An incorporator,
director, officer, employee, stockholder or controlling person, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or this Indenture or for any
102
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall waive and release
all such liability. The waiver and release shall be part of the consideration
for the issue of the Securities.
SECTION 13.11. Successors. All agreements of the Company in
this Indenture and the Securities shall bind their respective successors. All
agreements of the Trustee in this Indenture shall bind its successors.
SECTION 13.12. Multiple Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Indenture.
SECTION 13.13. Variable Provisions. The Company initially
appoints the Trustee as Paying Agent and Registrar and custodian with respect to
any Global Securities.
SECTION 13.14. Qualification of Indenture. The Company shall
qualify this Indenture under the TIA in accordance with the terms and conditions
of the Registration Rights Agreement and shall pay all reasonable costs and
expenses (including attorneys' fees and expenses for the Company, the Trustee
and the Holders) incurred in connection therewith, including, but not limited
to, costs and expenses of qualification of this Indenture and the Securities and
printing this Indenture and the Securities. The Trustee shall be entitled to
receive from the Company any such Officers' Certificates, Opinions of Counsel or
other documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
SECTION 13.15. Table of Contents; Headings. The table of
contents, cross-reference sheet and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
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IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed as of the date first written above.
NEBRASKA BOOK COMPANY, INC.
By:______________________________
Name:
Title:
SPECIALTY BOOKS, INC.
By:______________________________
Name:
Title:
BNY MIDWEST TRUST COMPANY
By:______________________________
Name:
Title:
EXHIBIT A
[FORM OF FACE OF INITIAL SECURITY]
[Applicable Restricted Securities Legend]
[Depository Legend, if applicable]
No. [___] Principal Amount $[______________], as
revised by the Schedule of Increases and
Decreases in Global Security attached hereto
CUSIP NO. ____________
ISIN: ____________
8-5/8% Senior Subordinated Notes due 2012
Nebraska Book Company, Inc., a Kansas corporation, promises to
pay to CEDE & CO., or registered assigns, the principal sum of
[__________________] Dollars, as revised by the Schedule of Increases and
Decreases in Global Security attached hereto, on March 15, 2012.
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: NEBRASKA BOOK COMPANY, INC.
By:_______________________
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
BNY MIDWEST TRUST COMPANY,
as Trustee, certifies that this
is one of the Securities
referred to in the Indenture.
By ____________________________
Authorized Signatory March 4, 2004
A-1
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
8-5/8% Senior Subordinated Note due 2012
1. Interest
Nebraska Book Company, Inc., a Kansas corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on the
principal amount of this Security at the rate per annum shown above.
The Company will pay interest in cash semiannually in arrears
on March 15 and September 15 of each year commencing September 15, 2004.
Interest on the Securities will accrue from the most recent date to which
interest has been paid on the Securities or, if no interest has been paid, from
March 4, 2004. The Company shall pay interest on overdue principal or premium,
if any (plus interest on such interest to the extent lawful), at the rate borne
by the Securities to the extent lawful. Interest will be computed on the basis
of a 360-day year of twelve 30-day months.
2. Method of Payment
By at least 10:00 a.m. (New York City time) on the date on
which any principal of or interest on any Security is due and payable, the
Company shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Company
will pay interest (except Defaulted Interest) to the Persons who are registered
Holders of Securities at the close of business on the March 1 or September 1
next preceding the interest payment date even if Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. Payments in respect of Securities represented by a Global
Security (including principal, premium, if any, and interest) will be made by
the transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depository. The Company will make all
payments in respect of a Definitive Security (including principal, premium, if
any, and interest) by mailing a check to the registered address of each Holder
thereof; provided, however, that payments on the Securities may also be made, in
the case of a Holder of at least $1,000,000 aggregate principal amount of
Securities, by wire transfer to a U.S. dollar account maintained by the payee
with a bank in the United States if such Holder elects payment by wire transfer
by giving written notice to the Trustee or the Paying Agent to such effect
designating such account no later than 15 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
Initially, BNY Midwest Trust Company, an Illinois trust
company (the "Trustee"), will act as Trustee, Paying Agent and Registrar. The
Company may appoint and
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change any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. The Company or any of its domestically incorporated Wholly-Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as
of March 4, 2004 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Company, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on
the date of the Indenture (the "Act"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all such terms, and Securityholders are referred to
the Indenture and the Act for a statement of those terms.
The Securities are general unsecured senior subordinated
obligations of the Company. This is one of the Initial Securities referred to in
the Indenture. The Securities include the Initial Securities issued on the Issue
Date, any Additional Securities issued in accordance with Section 2.16 of the
Indenture and the Exchange Securities. The Initial Securities, Additional
Securities and the Exchange Securities are treated as a single class of
securities under the Indenture. The Indenture imposes certain limitations on,
among other things: the Incurrence of Indebtedness by the Company and its
Restricted Subsidiaries, the payment of dividends and other distributions on the
Capital Stock of the Company and its Restricted Subsidiaries, the purchase or
redemption of Capital Stock of the Company and Capital Stock of such Restricted
Subsidiaries, certain purchases or redemptions of Subordinated Obligations, the
Incurrence of Liens by the Company or its Restricted Subsidiaries, the sale or
transfer of assets and Capital Stock of Restricted Subsidiaries, the issuance or
sale of Capital Stock of Restricted Subsidiaries, the business activities and
investments of the Company and its Restricted Subsidiaries, and transactions
with Affiliates. In addition, the Indenture limits the ability of the Company
and its Restricted Subsidiaries to restrict distributions and dividends from
Restricted Subsidiaries.
To guarantee the due and punctual payment of the principal,
premium, if any, and interest on the Securities and all other amounts payable by
the Company under the Indenture and the Securities when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according to
the terms of the Securities and the Indenture, the Subsidiary Guarantors have
unconditionally guaranteed (and future Subsidiary Guarantors, together with the
Subsidiary Guarantors, will unconditionally guarantee), jointly and severally,
such obligations on a senior subordinated basis pursuant to the terms of the
Indenture.
5. Redemption
Except as set forth below, the Securities will not be
redeemable at the option of the Company prior to March 15, 2008. On and after
such date, the Securities will be redeemable, at the Company's option, in whole
or in part, at any time upon not less than 30 nor more than 60 days prior notice
mailed by first-class mail to each holder's registered address, at the
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following redemption prices (expressed in percentages of principal amount), plus
accrued and unpaid interest to the redemption date (subject to the right of
holders of record on the relevant record date to receive interest due on the
relevant interest payment date):
If redeemed during the 12-month period commencing on March 15
of the years set forth below:
PERIOD REDEMPTION PRICE
------ ----------------
2008 104.313%
2009 102.156%
2010 and thereafter 100.000%
In addition, at any time and from time to time prior to March
15, 2007, the Company may redeem in the aggregate up to 40% of the original
principal amount of the Securities with the net proceeds of one or more Equity
Offerings at a redemption price (expressed as a percentage of principal amount)
of 108.625% plus accrued and unpaid interest, if any, to the redemption date
(subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date); provided, however,
that at least 60% of the original principal amount of the Securities must remain
outstanding after each such redemption and the redemption occurs within 90 days
after the closing of such Equity Offering.
If the optional redemption date is on or after an interest
record date and on or before the related interest payment date, the accrued and
unpaid interest, if any, will be paid to the Person in whose name the Security
is registered at the close of business, on such record date, and no additional
interest will be payable to holders whose Securities will be subject to
redemption by the Company.
In the case of any partial redemption, selection of the
Securities for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities are listed, or if the Securities are not listed, then on a pro rata
basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate, although no Securities of $1,000 in
original principal amount or less will be redeemed in part. If any Security is
to be redeemed in part only, the notice of redemption relating to such Security
shall state the portion of the principal amount thereof to be redeemed. A new
Security in principal amount equal to the unredeemed portion thereof will be
issued in the name of the holder thereof upon cancellation of the original
Security.
6. Repurchase Provisions
(a) Upon a Change of Control, any Holder of Securities will
have the right to cause the Company to repurchase all or any part of the
Securities of such Holder at a purchase price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest, if any, to the date
of repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date) as provided
in, and subject to the terms of, the Indenture.
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(b) If the Company or a Restricted Subsidiary consummates an
Asset Disposition permitted by the Indenture, when the aggregate amount of Offer
Proceeds equals or exceeds $5.0 million, the Company shall make an Offer for all
outstanding Securities pro rata up to a maximum principal amount (expressed as a
multiple of $1,000) of Securities equal to such Offer Proceeds, at a purchase
price in cash equal to 100% of the principal amount thereof, plus accrued and
unpaid interest thereon, if any, to the date of purchase in accordance with the
procedures set forth in Section 3.7 of the Indenture.
7. Subordination
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose. The
Securities will in all respects rank pari passu with all other Senior
Subordinated Indebtedness.
8. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register
the transfer of or exchange (i) any Securities selected for redemption (except,
in the case of a Security to be redeemed in part, the portion of the Security
not to be redeemed) for a period beginning 15 days before a selection of
Securities to be redeemed and ending on the date of such selection or (ii) any
Securities for a period beginning 15 days before an interest payment date and
ending on such interest payment date.
9. Persons Deemed Owners
The registered holder of this Security will be treated as the
owner of it for all purposes.
10. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
11. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the
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Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
12. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Securities and (ii) any default (other than with respect to nonpayment or in
respect of a provision that cannot be amended without the written consent of
each Securityholder affected) or noncompliance with any provision may be waived
with the written consent of the Holders of a majority in principal amount of the
then outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article IV of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities, or to secure the Securities, or to add additional covenants, or
surrender rights and powers conferred on the Company and the Subsidiary
Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder, or to provide for the
issuance of Exchange Securities, or to make any change in the subordination
provisions of the Indenture that would limit or terminate the benefits of any
holders under such subordination provisions.
13. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for
30 days in payment of interest when due on the Securities; (ii) default in
payment of principal or premium, if any, on the Securities at maturity, upon
optional redemption, upon required repurchase, upon declaration or otherwise;
(iii) the failure by the Company to comply with its obligations under Article IV
or Section 11.2 of the Indenture, (iv) failure by the Company or any Subsidiary
Guarantor to comply for 30 days after notice with any of its obligations under
the covenants described under Section 3.9 of the Indenture or under other
covenants specified in the Indenture (in each case, other than a failure to
purchase Securities which shall constitute an Event of Default under clause (ii)
above and other than a failure to comply with Section 3.9 which is covered by
clause (iii) above), (v) the failure by the Company to comply for 60 days after
notice with its other agreements contained in the Indenture, (vi) Indebtedness
of the Company or any Restricted Subsidiary not paid within any applicable grace
period after final maturity or is accelerated by the holders thereof because of
a default and the total amount of such Indebtedness unpaid or accelerated
exceeds $15.0 million (the "cross acceleration provision"), (vii) certain events
of bankruptcy, insolvency or reorganization of the Company or a Significant
Subsidiary (the "bankruptcy provisions"), (viii) any judgment or decree for the
payment of money in excess of $15.0 million is rendered against the Company or a
Significant Subsidiary and such judgment or decree shall remain undischarged or
unstayed for a period of 60 days after such judgment becomes final and
non-appealable (the "judgment default provision") or (ix) any Subsidiary
Guarantee ceases to be in full force and effect (except as contemplated by the
terms of the Indenture) or is declared null and void in a judicial proceeding or
any Subsidiary Guarantor
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denies or disaffirms its obligations under the Indenture or its Subsidiary
Guarantee. However, a default under clauses (iv) and (v) will not constitute an
Event of Default until the Trustee or the holders of more than 25% in principal
amount of the outstanding Securities notify the Company of the default and the
Company does not cure such default within the time specified in clauses (iv) and
(v) hereof after receipt of such notice.
If an Event of Default occurs and is continuing (other than an
Event of Default described in clause (vii) above), the Trustee or the Holders of
at least 25% in principal amount of the outstanding Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment of
principal or interest) if it determines that withholding notice is in their
interest.
14. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
15. No Recourse Against Others
An incorporator, director, officer, employee, stockholder or
controlling person, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
16. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
17. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entirety), JT
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TEN (=joint tenants with rights of survivorship and not as tenants in common),
CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
18. 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.
19. Governing Law
This Security shall be governed by, and construed in
accordance with, the laws of the State of New York.
The Company will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture.
Requests may be made to:
Nebraska Book Company, Inc.
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, XX 00000
Attention of: Chief Financial Officer
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
______________________________
(Print or type assignee's name, address and zip code)
______________________________
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably _________________ appoint agent to transfer this
Security on the books of the Company. The agent may substitute another
to act for him.
________________________________________________________________________________
Date:____________________ Your Signature:___________________
Signature Guarantee:______________________________________
(Signature must be guaranteed)
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the date that is two years after the
later of the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being:
CHECK ONE BOX BELOW:
1 [ ] acquired for the undersigned's own account, without transfer;
or
2 [ ] transferred to the Company; or
3 [ ] transferred pursuant to and in compliance with Rule 144A under
the Securities Act of 1933, as amended (the "Securities Act");
or
4 [ ] transferred pursuant to an effective registration statement
under the Securities Act; or
5 [ ] transferred pursuant to and in compliance with Regulation S
under
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the Securities Act; or
6 [ ] transferred to an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act), that has furnished to the Trustee a signed
letter containing certain representations and agreements (the
form of which letter appears as Section 2.7 of the Indenture);
or
7 [ ] transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Company may require, prior to registering any
such transfer of the Securities, in their sole discretion, such legal opinions,
certifications and other information as the Trustee or the Company may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act.
________________________
Signature
Signature Guarantee:
_________________________________ ________________________
(Signature must be guaranteed) Signature
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing
this Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested pursuant to
Rule 144A or has determined not to request such information and that it is aware
that the transferor is relying upon the undersigned's foregoing representations
in order to claim the exemption from registration provided by Rule 144A.
___________________________
Dated:
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been
made:
Signature of
Amount of Amount of Principal Amount authorized
decrease in increase in of this Global signatory of
Date of Principal Amount Principal Amount Security following Trustee or
increase/ of this Global of this Global such decrease or Securities
decrease Security Security increase Custodian
-------- -------- -------- -------- ---------
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 3.7 or 3.9 of the Indenture, check the box:
[ ] [ ]
3.7 3.9
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 3.7 or 3.9 of the Indenture, state
the amount in principal amount (must be integral multiple of $1,000): $
Date: ______ Your Signature ___________________________________________________
(Sign exactly as your name appears on the other side of the Security)
Signature Guarantee:____________________________________________________________
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
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EXHIBIT B
[FORM OF FACE OF EXCHANGE SECURITY]
[Depository Legend, if applicable]
No. [_____] Principal Amount $[___________], as revised
by the Schedule of Increases and Decreases in Global
Security attached hereto
CUSIP NO._______________
ISIN:________________
8-5/8% Senior Subordinated Notes due 2012
Nebraska Book Company, Inc., a Kansas corporation, promises
to pay to CEDE & CO., or registered assigns, the principal sum of
[_______________] Dollars, as revised by the Schedule of Increases and Decreases
in Global Security attached hereto, on March 15, 2012.
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
Additional provisions of this Security are set forth on the
other side of this Security.
NEBRASKA BOOK COMPANY, INC.
By:_________________________
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
BNY MIDWEST TRUST COMPANY,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By:______________________________
Authorized Signatory Date:
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[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
8-5/8% Senior Subordinated Note due 2012
1. Interest
Nebraska Book Company, Inc., a Kansas corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on the
principal amount of this Security at the rate per annum shown above.
The Company will pay interest in cash semiannually in arrears
on March 15 and September 15 of each year commencing September 15, 2004.
Interest on the Securities will accrue from the most recent date to which
interest has been paid on the Securities or, if no interest has been paid, from
March 4, 2004. The Company shall pay interest on overdue principal or premium,
if any (plus interest on such interest to the extent lawful), at the rate borne
by the Securities to the extent lawful. Interest will be computed on the basis
of a 360-day year of twelve 30-day months.
2. Method of Payment
By at least 10:00 a.m. (New York City time) on the date on
which any principal of or interest on any Security is due and payable, the
Company shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Company
will pay interest (except Defaulted Interest) to the Persons who are registered
Holders of Securities at the close of business on the March 1 or September 1
next preceding the interest payment date even if Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. Payments in respect of Securities represented by a Global
Security (including principal, premium, if any, and interest) will be made by
the transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depository. The Company will make all
payments in respect of a Definitive Security (including principal, premium, if
any, and interest) by mailing a check to the registered address of each Holder
thereof; provided, however, that payments on the Securities may also be made, in
the case of a Holder of at least $1,000,000 aggregate principal amount of
Securities, by wire transfer to a U.S. dollar account maintained by the payee
with a bank in the United States if such Holder elects payment by wire transfer
by giving written notice to the Trustee or the Paying Agent to such effect
designating such account no later than 15 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
Initially, BNY Midwest Trust Company, an Illinois trust
company (the "Trustee"), will act as Trustee, Paying Agent and Registrar. The
Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice to any Securityholder. The
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Company or any of its domestically incorporated Wholly-Owned Subsidiaries may
act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as
of March 4, 2004 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Company, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on
the date of the Indenture (the "Act"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all such terms, and Securityholders are referred to
the Indenture and the Act for a statement of those terms.
The Securities are general unsecured senior subordinated
obligations of the Company. This is one of the Exchange Securities referred to
in the Indenture. The Securities include the Initial Securities issued on the
Issue Date, any Additional Securities issued in accordance with Section 2.16 of
the Indenture and the Exchange Securities. The Initial Securities, Additional
Securities and the Exchange Securities are treated as a single class of
securities under the Indenture. The Indenture imposes certain limitations on,
among other things: the Incurrence of Indebtedness by the Company and its
Restricted Subsidiaries, the payment of dividends and other distributions on the
Capital Stock of the Company and its Restricted Subsidiaries, the purchase or
redemption of Capital Stock of the Company and Capital Stock of such Restricted
Subsidiaries, certain purchases or redemptions of Subordinated Obligations, the
Incurrence of Liens by the Company or its Restricted Subsidiaries, the sale or
transfer of assets and Capital Stock of Restricted Subsidiaries, the issuance or
sale of Capital Stock of Restricted Subsidiaries, the business activities and
investments of the Company and its Restricted Subsidiaries, and transactions
with Affiliates. In addition, the Indenture limits the ability of the Company
and its Restricted Subsidiaries to restrict distributions and dividends from
Restricted Subsidiaries.
To guarantee the due and punctual payment of the principal,
premium, if any, and interest on the Securities and all other amounts payable by
the Company under the Indenture and the Securities when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according to
the terms of the Securities and the Indenture, the Subsidiary Guarantors have
unconditionally guaranteed (and future Subsidiary Guarantors, together with the
Subsidiary Guarantors, will unconditionally guarantee), jointly and severally,
such obligations on a senior subordinated basis pursuant to the terms of the
Indenture.
5. Optional Redemption
Except as set forth below, the Securities will not be
redeemable at the option of the Company prior to March 15, 2008. On and after
such date, the Securities will be redeemable, at the Company's option, in whole
or in part, at any time upon not less than 30 nor more than 60 days prior notice
mailed by first-class mail to each holder's registered address, at the following
redemption prices (expressed in percentages of principal amount), plus accrued
and
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unpaid interest to the redemption date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
interest payment date):
If redeemed during the 12-month period commencing on March 15
of the years set forth below:
PERIOD REDEMPTION PRICE
------ ----------------
2008 104.313%
2009 102.156%
2010 and thereafter 100.000%
In addition, at any time and from time to time prior to March
15, 2007, the Company may redeem in the aggregate up to 40% of the original
principal amount of the Securities with the net proceeds of one or more Equity
Offerings at a redemption price (expressed as a percentage of principal amount)
of 108.625% plus accrued and unpaid interest, if any, to the redemption date
(subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date); provided, however,
that at least 60% of the original principal amount of the Securities must remain
outstanding after each such redemption and the redemption occurs within 90 days
after the closing of such Equity Offering.
If the optional redemption date is on or after an interest
record date and on or before the related interest payment date, the accrued and
unpaid interest, if any, will be paid to the Person in whose name the Security
is registered at the close of business, on such record date, and no additional
interest will be payable to holders whose Securities will be subject to
redemption by the Company.
In the case of any partial redemption, selection of the
Securities for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities are listed, or if the Securities are not listed, then on a pro rata
basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate, although no Securities of $1,000 in
original principal amount or less will be redeemed in part. If any Security is
to be redeemed in part only, the notice of redemption relating to such Security
shall state the portion of the principal amount thereof to be redeemed. A new
Security in principal amount equal to the unredeemed portion thereof will be
issued in the name of the holder thereof upon cancellation of the original
Security.
6. Repurchase Provisions
(a) Upon a Change of Control, any Holder of Securities
will have the right to cause the Company to repurchase all or any part of the
Securities of such Holder at a purchase price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest, if any, to the date
of repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date) as provided
in, and subject to the terms of, the Indenture.
(b) If the Company or a Restricted Subsidiary consummates
an Asset Disposition permitted by the Indenture, when the aggregate amount of
Offer Proceeds equals or
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exceeds $5.0 million, the Company shall make an Offer for all outstanding
Securities pro rata up to a maximum principal amount (expressed as a multiple of
$1,000) of Securities equal to such Offer Proceeds, at a purchase price in cash
equal to 100% of the principal amount thereof, plus accrued and unpaid interest
thereon, if any, to the date of purchase in accordance with the procedures set
forth in Section 3.7 of the Indenture.
7. Subordination
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose. The
Securities will in all respects rank pari passu with all other Senior
Subordinated Indebtedness.
8. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register
the transfer of or exchange (i) any Securities selected for redemption (except,
in the case of a Security to be redeemed in part, the portion of the Security
not to be redeemed) or for a period beginning 15 days before a selection of
Securities to be redeemed and ending on the date of selection or (ii) any
Securities for a period beginning 15 days before an interest payment date and
ending on such interest payment date.
9. Persons Deemed Owners
The registered holder of this Security will be treated as the
owner of it for all purposes.
10. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
11. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the
Securities to redemption or maturity, as the case may be.
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12. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Securities and (ii) any default (other than with respect to nonpayment or in
respect of a provision that cannot be amended without the written consent of
each Securityholder affected) or noncompliance with any provision may be waived
with the written consent of the Holders of a majority in principal amount of the
then outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article IV of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities or to secure the Securities, or to add additional covenants or
surrender rights and powers conferred on the Company and the Subsidiary
Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder, or to provide for the
issuance of Exchange Securities.
13. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for
30 days in payment of interest when due on the Securities; (ii) default in
payment of principal or premium, if any, on the Securities at maturity, upon
optional redemption, upon required repurchase, upon declaration or otherwise;
(iii) the failure by the Company to comply with its obligations under Article IV
or Section 11.2 of the Indenture, (iv) failure by the Company or any Subsidiary
Guarantor to comply for 30 days after notice with any of its obligations under
the covenants described under Section 3.9 of the Indenture or under other
covenants specified in the Indenture (in each case, other than a failure to
purchase Securities which shall constitute an Event of Default under clause (ii)
above and other than a failure to comply with Section 3.9 which is covered by
clause (iii) above), (v) the failure by the Company to comply for 60 days after
notice with its other agreements contained in the Indenture, (vi) Indebtedness
of the Company or any Restricted Subsidiary not paid within any applicable grace
period after final maturity or is accelerated by the holders thereof because of
a default and the total amount of such Indebtedness unpaid or accelerated
exceeds $15.0 million (the "cross acceleration provision"), (vii) certain events
of bankruptcy, insolvency or reorganization of the Company or a Significant
Subsidiary (the "bankruptcy provisions"), (viii) any judgment or decree for the
payment of money in excess of $15.0 million is rendered against the Company or a
Significant Subsidiary and such judgment or decree shall remain undischarged or
unstayed for a period of 60 days after such judgment becomes final and
non-appealable (the "judgment default provision") or (ix) any Subsidiary
Guarantee ceases to be in full force and effect (except as contemplated by the
terms of the Indenture) or is declared null and void in a judicial proceeding or
any Subsidiary Guarantor denies or disaffirms its obligations under the
Indenture or its Subsidiary Guarantee. However, a default under clauses (iv) and
(v) will not constitute an Event of Default until the Trustee or the holders of
more than 25% in principal amount of the outstanding Securities notify the
Company of the default and the Company does not cure such default within the
time specified in clauses (iv) and (v) hereof after receipt of such notice.
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If an Event of Default occurs and is continuing (other than an
Event of Default described in clause (vii) above), the Trustee or the Holders of
at least 25% in principal amount of the outstanding Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment of
principal or interest) if it determines that withholding notice is in their
interest.
14. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
15. No Recourse Against Others
An incorporator, director, officer, employee, stockholder or
controlling person, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
16. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
17. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship
and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to
Minors Act).
18. 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
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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.
19. Governing Law
This Security shall be governed by, and construed in
accordance with, the laws of the State of New York.
The Company will furnish to any Securityholder upon
request and without charge to the Securityholder a copy of the
Indenture. Requests may be made to:
Nebraska Book Company, Inc.
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, XX 00000
Attention of: Chief Financial Officer
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
____________________________________________
(Print or type assignee's name, address and zip code)
___________________________________
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint __________ agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
________________________________________________________________________________
Date:_________________ Your Signature __________________________________________
Signature Guarantee: ___________________________________________________________
(Signature must be guaranteed)
________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
B-9
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security
have been made:
Signature of
Amount of Amount of Principal Amount authorized
decrease in increase in of this Global signatory of
Date of Principal Amount Principal Amount Security following Trustee or
increase/ of this Global of this Global such decrease or Securities
decrease Security Security increase Custodian
-------- ---------------- ---------------- ------------------ ------------
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 3.7 or 3.9 of the Indenture, check the box:
[ ] [ ]
3.7 3.9
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 3.7 or 3.9 of the Indenture, state
the amount in principal amount (must be integral multiple of $1,000): $
Date:_____ Your Signature _____________________________________________________
(Sign exactly as your name appears on the other side of the Security)
Signature Guarantee:____________________________________________________________
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
B-11
EXHIBIT C
FORM OF SUBSIDIARY GUARANTEE
This Supplemental Indenture, dated as of [__________] (this
"Supplemental Indenture" or "Guarantee"), among [name of future Subsidiary
Guarantor] (the "Guarantor"), Nebraska Book Company, Inc. (together with its
successors and assigns, the "Company"), each other then existing Subsidiary
Guarantor under the Indenture referred to below, and BNY Midwest Trust Company,
as Trustee under the Indenture referred to below.
WITNESSETH:
WHEREAS, the Company, the Subsidiary Guarantors and the
Trustee have heretofore executed and delivered an Indenture, dated as of March
4, 2004 (as amended, supplemented, waived or otherwise modified, the
"Indenture"), providing for the initial issuance of an aggregate principal
amount of $175.0 million of 8-5/8% Senior Subordinated Notes due 2012 of the
Company (the "Securities");
WHEREAS, Section 3.12 of the Indenture provides that the
Company is required to cause each Restricted Subsidiary that guarantees
Indebtedness under the Credit Agreement to execute and deliver to the Trustee a
Subsidiary Guarantee pursuant to which such Subsidiary Guarantor will
unconditionally Guarantee, on a joint and several basis, the full and prompt
payment of the principal of, premium, if any and interest on the Securities on a
senior subordinated basis; and
WHEREAS, pursuant to Section 9.1 of the Indenture, the Trustee
and the Company are authorized to execute and deliver this Supplemental
Indenture to amend the Indenture, without the consent of any Securityholder;
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the Guarantor, the Company, the other Subsidiary Guarantors and
the Trustee mutually covenant and agree for the equal and ratable benefit of the
holders of the Securities as follows:
ARTICLE I
Definitions
SECTION 1.1 Defined Terms. As used in this Subsidiary
Guarantee, terms defined in the Indenture or in the preamble or recital hereto
are used herein as therein defined, except that the term "Holders" in this
Guarantee shall refer to the term "Holders" as defined in the Indenture and the
Trustee acting on behalf or for the benefit of such holders. The words "herein,"
"hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
C-1
ARTICLE II
Agreement to be Bound; Guarantee
SECTION 2.1 Agreement to be Bound The Guarantor hereby becomes
a party to the Indenture as a Subsidiary Guarantor and as such will have all of
the rights and be subject to all of the obligations and agreements of a
Subsidiary Guarantor under the Indenture. The Guarantor agrees to be bound by
all of the provisions of the Indenture applicable to a Subsidiary Guarantor and
to perform all of the obligations and agreements of a Subsidiary Guarantor under
the Indenture.
SECTION 2.2 Guarantee. The Guarantor hereby unconditionally
guarantees, jointly and severally with each other Subsidiary Guarantor, to each
Holder of the Securities and the Trustee, the full and punctual payment when
due, whether at maturity, by acceleration, by redemption or otherwise, of the
Obligations pursuant to Article X of the Indenture on a senior subordinated
basis. Each Subsidiary Guarantee will be subordinated to the prior payment in
full of all Guarantor Senior Indebtedness as provided in Article XII of the
Indenture. Each Subsidiary Guarantee will rank equally with all other Guarantor
Senior Subordinated Indebtedness of that Subsidiary Guarantor and will be senior
in right of payment to all future Guarantor Subordinated Obligations of that
Guarantor. The Subsidiary Guarantees will be effectively subordinated to any
secured Indebtedness of the applicable Guarantor to the extent of the value of
the assets securing such Indebtedness.
ARTICLE II
Miscellaneous
SECTION 3.1 Notices. All notices and other communications
pertaining to this Guarantee or any Security shall be in writing and shall be
deemed to have been duly given upon the receipt thereof. Such notices shall be
delivered by hand, or mailed, certified or registered mail with postage prepaid
(a) if to the Guarantor, at its address set forth below, with a copy to the
Company as provided in the Indenture for notices to the Company, and (b) if to
the Holders or the Trustee, as provided in the Indenture. The Guarantor by
notice to the Trustee may designate additional or different addresses for
subsequent notices to or communications with the Guarantor.
SECTION 3.2 Parties. Nothing expressed or mentioned in this
Guarantee is intended or shall be construed to give any Person, firm or
corporation, other than the Holders and the Trustee and the holders of any
Guarantor Senior Indebtedness, any legal or equitable right, remedy or claim
under or in respect of this Guarantee or any provision herein contained.
SECTION 3.3 Governing Law. This Agreement shall be governed by
the laws of the State of New York.
SECTION 3.4 Severability Clause. In case any provision in this
Guarantee shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining
C-2
provisions shall not in any way be affected or impaired thereby and such
provision shall be ineffective only to the extent of such invalidity, illegality
or unenforceability.
SECTION 3.5 Entire Agreement. This Guarantee is intended by
the parties to be a final expression of their agreement in respect of the
subject matter contained herein and, together with the Indenture, supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
SECTION 3.6 Ratification of Indenture; Supplemental Indentures
Part of Indenture. Except as expressly amended hereby, the Indenture is in all
respects ratified and confirmed and all the terms, conditions and provisions
thereof shall remain in full force and effect. This Supplemental Indenture shall
form a part of the Indenture for all purposes, and every holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby. The
Trustee makes no representation or warranty as to the validity or sufficiency of
this Supplemental Indenture.
SECTION 3.7 Counterparts. The parties hereto may sign one or
more copies of this Supplemental Indenture in counterparts, all of which
together shall constitute one and the same agreement.
SECTION 3.8 Headings. The headings of the Articles and the
sections in this Guarantee are for convenience of reference only and shall not
be deemed to alter or affect the meaning or interpretation of any provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed as of the date first above written.
[NAME OF GUARANTOR],
By:
______________________________
Name:
Title:
Address:
NEBRASKA BOOK COMPANY, INC.
By:
______________________________
Name:
Title:
[Add signature block for any other
existing Subsidiary Guarantors]
BNY MIDWEST TRUST COMPANY
By:
______________________________
Name:
Title:
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