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JORDAN INDUSTRIES, INC.
AND
FIRST TRUST NATIONAL ASSOCIATION
AS TRUSTEE
$275,000,000
10 3/8% SENIOR NOTES DUE 2003
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INDENTURE
Dated as of July 15, 1993
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CROSS-REFERENCE TABLE *
Trust Indenture
Act Section .............................................. Indenture Section
310(a)(1) ...................................................... 7.10
(a)(2) ...................................................... 7.10
(a)(3) ...................................................... N.A.**
(a)(4) ...................................................... N.A.
(a)(5) ...................................................... 7.10
(b) ......................................................... 7.10
(c) ......................................................... N.A.
311(a) ......................................................... 7.11
(b) ......................................................... 7.11
(c) ......................................................... N.A.
312(a) ......................................................... 2.05
(b) ......................................................... 10.03
(c) ......................................................... 10.03
313(a) ......................................................... 7.06
(b)(1) ...................................................... N.A.
(b)(2) ...................................................... 7.06
(c) ......................................................... 7.06;10.02
(d) ......................................................... 7.06
314(a) ......................................................... 4.02;10.02
(b) ......................................................... N.A.
(c)(1) ...................................................... 10.04
(c)(2) ...................................................... 10.04
(c)(3) ...................................................... N.A.
(d) ......................................................... N.A.
(e) ......................................................... 10.05
(f) ......................................................... N.A.
315(a) ......................................................... 7.01
(b) ......................................................... 7.05
(c) ......................................................... 7.01
(d) ......................................................... 7.01
(e) ......................................................... 6.11
316(a)(last sentence) .......................................... 2.09
(a)(1)(A) ................................................... 6.05
(a)(1)(B) ................................................... 6.04
(a)(2) ...................................................... N.A.
(b) ......................................................... 6.04;6.07
317(a)(1) ...................................................... 6.08
(a)(2) ...................................................... 6.09
(b) ......................................................... 2.04
318(a) ......................................................... 10.01
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* This Cross-Reference Table is not part of the Indenture.
** Not applicable.
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions .................................................. 1
Section 1.02. Other Definitions ............................................ 16
Section 1.03. Incorporation by Reference of Trust Indenture Act ............ 17
Section 1.04. Rules of Construction ........................................ 17
ARTICLE 2
THE SECURITIES
Section 2.01. Form and Dating .............................................. 17
Section 2.02. Execution and Authentication ................................. 17
Section 2.03. Registrar and Paying Agent ................................... 18
Section 2.04. Paying Agent to Hold Money in Trust .......................... 18
Section 2.05. Holder Lists ................................................. 19
Section 2.06. Transfer and Exchange ........................................ 19
Section 2.07. Replacement Securities ....................................... 19
Section 2.08. Outstanding Securities ....................................... 20
Section 2.09. Treasury Securities .......................................... 20
Section 2.10. Temporary Securities ......................................... 20
Section 2.11. Cancellation ................................................. 20
Section 2.12. Defaulted Interest ........................................... 21
Section 2.13. Record Date .................................................. 21
Section 2.14. CUSIP Number ................................................. 21
ARTICLE 3
OPTIONAL REDEMPTION AND MANDATORY OFFERS TO PURCHASE
Section 3.01. Notices to Trustee ........................................... 21
Section 3.02. Selection of Securities to be Redeemed or Purchased .......... 22
Section 3.03. Notice of Redemption ......................................... 22
Section 3.04. Effect of Notice of Redemption ............................... 23
Section 3.05. Deposit of Redemption Price .................................. 23
Section 3.06. Securities Redeemed in Part .................................. 24
Section 3.07. Optional Redemption Provisions ............................... 24
Section 3.08. Mandatory Purchase Provisions ................................ 24
ARTICLE 4
COVENANTS
Section 4.01. Payment of Securities ........................................ 26
Section 4.02. SEC Reports .................................................. 26
Section 4.03. Compliance Certificate ....................................... 27
Section 4.04. Stay, Extension and Usury Laws ............................... 27
Section 4.05. Limitation on Restricted Payments ............................ 28
Section 4.06. Corporate Existence .......................................... 31
(i)
Section 4.07. Limitation on Incurrence of Indebtedness ..................... 31
Section 4.08. Limitation on Transactions With Affiliates ................... 32
Section 4.09. Limitation on Liens .......................................... 33
Section 4.10. Compliance With Laws, Taxes .................................. 33
Section 4.11. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries ............... 33
Section 4.12. Maintenance of Office or Agencies ............................ 35
Section 4.13. Change of Control ............................................ 35
Section 4.14. Limitation on Asset Sales .................................... 35
Section 4.15. Redemption of Old Notes ...................................... 36
Section 4.16. Limitation on Amendment of Discount Debenture
Indenture .................................................... 36
Section 4.17. Guarantees by Restricted Subsidiaries ........................ 37
ARTICLE 5
SUCCESSORS
Section 5.01. Merger or Consolidation ...................................... 37
Section 5.02. Successor Corporation Substituted ............................ 38
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default ............................................ 38
Section 6.02. Acceleration ................................................. 40
Section 6.03. Other Remedies ............................................... 41
Section 6.04. Waiver of Past Defaults ...................................... 41
Section 6.05. Control by Majority .......................................... 41
Section 6.06. Limitation on Suits .......................................... 41
Section 6.07. Rights of Holders to Receive Payment ......................... 42
Section 6.08. Collection Suit by Trustee ................................... 42
Section 6.09. Trustee May File Proofs of Claim ............................. 42
Section 6.10. Priorities ................................................... 43
Section 6.11. Undertaking for Costs ........................................ 43
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee ............................................ 43
Section 7.02. Rights of Trustee ............................................ 44
Section 7.03. Individual Rights of Trustee ................................. 45
Section 7.04. Trustee's Disclaimer ......................................... 45
Section 7.05. Notice to Holders of Defaults and Events of Default .......... 45
Section 7.06. Reports by Trustee to Holders ................................ 45
Section 7.07. Compensation and Indemnity ................................... 45
Section 7.08. Replacement of Trustee ....................................... 46
Section 7.09. Successor Trustee by Merger, etc ............................. 47
Section 7.10. Eligibility, Disqualification ................................ 47
Section 7.11. Preferential Collection of Claims Against Company ............ 47
(ii)
ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.01. Discharge of Liability on Securities; Defeasance ............. 47
Section 8.02. Conditions to Defeasance ..................................... 48
Section 8.03. Application of Trust Money ................................... 49
Section 8.04. Repayment to Company ......................................... 49
Section 8.05. Indemnity for Government Obligations ......................... 50
Section 8.06. Reinstatement ................................................ 50
ARTICLE 9
AMENDMENTS
Section 9.01. Amendments and Supplements Permitted Without Consent
of Holders ................................................... 50
Section 9.02. Amendments and Supplements Requiring Consent of
Holders ...................................................... 51
Section 9.03. Compliance with TIA .......................................... 52
Section 9.04. Revocation and Effect of Consents ............................ 52
Section 9.05. Notation on or Exchange of Securities ........................ 52
Section 9.06. Trustee Protected ............................................ 52
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls ................................ 53
Section 10.02. Notices ..................................................... 53
Section 10.03. Communication by Holders with Other Holders ................. 54
Section 10.04. Certificate and Opinion as to Conditions Precedent .......... 54
Section 10.05. Statements Required in Certificate or Opinion ............... 54
Section 10.06. Rules by Trustee and Agents ................................. 54
Section 10.07. Legal Holidays .............................................. 54
Section 10.08. No Recourse Against Others .................................. 55
Section 10.09. Counterparts ................................................ 55
Section 10.10. Variable Provisions ......................................... 55
Section 10.11. Governing Law ............................................... 55
Section 10.12. No Adverse Interpretation of Other Agreements ............... 55
Section 10.13. Successors .................................................. 55
Section 10.14. Severability ................................................ 55
Section 10.15. Table of Contents, Headings, Etc ............................ 55
EXHIBIT A. Form of Security ................................................ A-1
(iii)
This Indenture, dated as of July 15, 1993, is between Jordan Industries,
Inc., an Illinois corporation, and First Trust National Association, as trustee.
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the holders of the Company's 10 3/8% Senior
Notes due 2003:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.
"Affiliate" means any of the following:
(i) any Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company,
(ii) any spouse, immediate family member or other relative who has
the same principal residence as any person described in clause
(i) above.
(iii) any trust in which any such Persons described in clause (i) or
(ii) above has a beneficial interest, and
(iv) any corporation or other organization of which any such
Persons described above collectively own 50% or more of the
equity of such entity.
"Agent" means any Registrar, Paying Agent, or co-registrar.
"Asset Sale" means the sale, lease, conveyance or other disposition by the
Company or a Restricted Subsidiary of assets or property (other than (i) the
sale or disposition of any Restricted Investment, (ii) the sale of inventory in
the ordinary course of business, or (iii) Receivables Financings) whether owned
on the date of original Issuance of the Securities or thereafter acquired, in a
single transaction or in a series of related transactions, that are outside of
the ordinary course of business of the Company or such Restricted Subsidiary.
"Bankruptcy Law" means title 00 Xxxxxx Xxxxxx Code or any similar federal
or state law for the relief of Debtors.
"Board of Directors" means the Company's board of directors or any
authorized committee of such board of directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligations" means any obligation that is required to be
classified and accounted for as a capitalized lease for financial purposes in
accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP.
1
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of corporate stock, including any
Preferred Stock.
"Cash Equivalents" means (a) securities with maturities of one year or
less from the date of acquisition issued or fully guaranteed or insured by the
United States Government or any agency thereof, (b) certificates of deposit,
time deposits, overnight bank deposits, bankers acceptances and repurchase
agreements of any commercial bank that has capital and surplus in excess of
$100,000,000 having maturities of one year or less from the date of acquisition,
(c) commercial paper of an issuer rated at least A-2 by Standard & Poor's
Corporation or P-2 by Xxxxx'x Investor 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 (d) money market accounts
or funds with or issued by Qualified Issuers.
"Cash Flow" means, for any given period and Person, the sum of, without
duplication, Consolidated Net Income, plus
(i) the portion of Net Income attributable to the minority interests in
its Subsidiaries, to the extent not included in calculating
Consolidated Net Income, plus
(ii) any provision for taxes based on income or profits to the extent
such income or profits were included in computing Consolidated Net
Income, plus
(iii) Consolidated Interest Expense, to the extent deducted in computing
Consolidated Net Income, plus
(iv) the amortization of all intangible assets, to the extent such
amortization was deducted in computing Consolidated Net Income
(including, but not limited to, inventory write-ups, goodwill, debt
and financing costs and Incentive Arrangements), plus
(v) any non-capitalized transaction costs incurred in connection with
financings or acquisitions, (including, but not limited to,
financing and refinancing fees, to the extent deducted in computing
Consolidated Net Income), plus
(vi) all depreciation and all other non-cash charges (including without
limitation, those charges relating to purchase accounting
adjustments, to the extent deducted in computing Consolidated Net
income), plus
(vii) any interest income, to the extent such income was not included in
computing Consolidated Net Income, plus
(viii) all dividend payments on Preferred Stock (whether or not paid in
cash), to the extent deducted in computing Consolidated Net Income,
plus
(ix) any extraordinary or non-recurring charge or expense arising out of
the implementation of SFAS 106 or SFAS 109, to the extent deducted
in computing Consolidated Net Income;
provided, however, that if any such calculation includes any period prior
to the date of original Issuance of the Securities, such calculation for
such period shall be made on a pro forma basis
2
as if all businesses acquired during the relevant period had been acquired
on the first day of such period.
"Cash Flow Coverage Ratio" means, for any given period and Person, the
ratio of:
(a) Cash Flow, divided by
(b) the sum of Consolidated Interest Expense and the amount of all
dividend payments on any series of Preferred Stock of such
Person (except dividends paid or payable in additional shares
of Capital Stock (other than Disqualified Stock)), in each
case, without duplication;
provided, however, that if any such calculation includes any period prior to the
date of original Issuance of the Securities, such calculation for such period
shall be made on a pro forma basis as provided in the definitions of
Consolidated Interest Expense and Cash Flow.
"Change of Control" means the occurrence of any of the following: (i) the
Jordan Stockholders shall fail to be the beneficial owners, directly or
indirectly, of at least 22% of the outstanding shares of common stock of the
Company on a fully-diluted basis (provided that the Issuance of any shares of
the Company's common stock pursuant to a primary public offering shall not be
considered to have diluted such percentage ownership); or (ii) the Company is
merged or consolidated with another corporation, or all or substantially all of
the assets of the Company are sold, leased or conveyed to another Person, and
the Jordan Stockholders are not the beneficial owners, directly or indirectly,
immediately following such transaction, of at least 22% of the Equity Interests
(which are entitled to vote in the election of directors or other governing
body) of the corporation surviving any such consolidation or merger, or the
Person to which such sale, lease or conveyance shall have been made; or (iii)
the Company is liquidated or dissolved.
"Company" means Jordan Industries, Inc. until a successor replaces it in
accordance with Article 5 and thereafter means the successor, and shall include
any and all other obligors on the Securities.
"Consolidated Interest Expense" means, for any given period and Person,
the aggregate of the interest expense in respect of all Indebtedness of such
Person and its Subsidiaries for such period, on a consolidated basis, determined
in accordance with GAAP (including amortization of original issue discount on
any such Indebtedness, all non-cash interest payments, the interest portion of
any deferred payment obligation and the interest component of Capital Lease
Obligations, but excluding amortization of deferred financing fees if such
amortization would otherwise be included in interest expense); provided,
however, that for the purpose of the Cash Flow Coverage Ratio in Sections 4.07
and 5.01, Consolidated Interest Expense shall be calculated on a pro forma basis
as if all Indebtedness Issued or refinanced during the relevant period had been
Issued or refinanced on the first day of such period; provided further that any
premiums, fees and expenses (including the amortization thereof) payable in
connection with the Refinancing Plan or any other refinancing of Indebtedness
will be excluded.
"Consolidated Net Income" means, for any given period and Person, the
aggregate of the Net Income of such Person and its Subsidiaries for such period,
on a consolidated basis, determined in accordance with GAAP; provided, however,
that:
(i) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition
shall be excluded, and
3
(ii) Consolidated Net Income of any Person will not include, without
duplication, any deduction for:
(A) any increased amortization or depreciation resulting from the
write-up of assets pursuant to Accounting Principles Board
Opinion Nos. 16 and 17, as amended or supplemented from time
to time,
(B) the amortization of all intangible assets (including
amortization attributable to inventory write-ups, goodwill,
debt and financing costs, and Incentive Arrangements),
(C) any non-capitalized transaction costs incurred in connection
with financings or acquisitions (including, but not limited
to, financing and refinancing fees),
(D) any extraordinary or nonrecurring charges relating to any
premium or penalty paid, write-off or deferred financing costs
or other financial recapitalization charges in connection with
redeeming or retiring any Indebtedness prior to its stated
maturity, and
(E) any non-recurring charge arising out of the restructuring or
consolidation of the operations of any Person(s) or business
either alone or together with the Company or any Restricted
Subsidiary, incurred within 18 months following the
acquisition of such Person(s) or business by the Company or
any Restricted Subsidiary;
provided, however, that for purposes of determining the Cash Flow Coverage Ratio
in Sections 4.07 and 5.01, Consolidated Net Income shall be calculated on a pro
forma basis as if all businesses acquired during the relevant period had been
acquired on the first day of such period.
"Consolidated Net Worth" with respect to any Person means, as of any date,
the consolidated equity of the common stockholders of such Person (excluding the
cumulated foreign currency translation adjustment), all determined on a
consolidated basis in accordance with GAAP, but without any reduction in respect
of the payment of dividends on any series of such Person's Preferred Stock if
such dividends are paid in additional shares of Capital Stock (other than
Disqualified Stock); provided, however, that Consolidated Net Worth shall also
include, without duplication:
(i) the amortization of all write-ups of inventory,
(ii) the amortization of all intangible assets (including amortization of
goodwill, debt and financing costs, and Incentive Arrangements),
(iii) any non-capitalized transaction costs incurred in connection with
financings or acquisitions (including, but not limited to, financing
and refinancing fees),
(iv) any increased amortization or depreciation resulting from the
write-up of assets pursuant to Accounting Principles Board Opinion
Nos. 16 and 17, as amended and supplemented from time to time,
(v) any extraordinary or nonrecurring charges or expenses relating to
any premium or penalty paid, write-off or deferred financing costs
or other financial recapitalization
4
charges incurred in connection with redeeming or retiring any
Indebtedness prior to its stated maturity,
(vi) any non-recurring cash charge arising out of the restructuring or
consolidation of the operations of any Person(s) or business either
alone or together with the Company or any Restricted Subsidiary,
incurred within 18 months following the acquisition of such
Person(s) or business by the Company or any Restricted Subsidiary,
and
(vii) any extraordinary or non-recurring charge arising out of the
implementation of SFAS 106 or SFAS 109;
provided, however, that for purposes of determining Consolidated Net Worth in
Section 5.01, Consolidated Net Worth shall be calculated on a pro forma basis as
if all businesses acquired during the relevant period had been acquired on the
first day of such period.
"Consulting Agreement" means the Amended and Restated Management
Consulting Agreement, between the Company and TJC Management Corporation, as in
effect on the date of original Issuance of the Securities.
"Corporate Trust Office" shall be at the address of the Trustee specified
in Section 10.02 or such other address as the Trustee may give notice to the
Company.
"Credit Agent" means the agent under the Credit Agreement or the New
Credit Agreement, as the case may be, or such other Person as may be designated
as such by the Company from time to time by notifying the Trustee.
"Credit Agreement" means the amended and restated revolving credit
agreement dated December 10, 1991 among the Company, certain of its Subsidiaries
and The First National Bank of Boston, as amended or supplemented from time to
time.
"Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Discount Debentures" means the Company's 11 3/4% Senior Subordinated
Discount Debentures due 2005.
"Discount Debenture Indenture" means the Indenture governing the Company's
Discount Debentures as in effect on the date of original Issuance of the
Securities and as thereafter amended.
"Disqualified Stock" means any Capital Stock that by its terms (or by the
terms of any security into which its is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part on, or prior to, the
maturity date of the Securities.
"Dura-Line Agreement" means the Preferred Stock Agreement, dated March 1,
1992, among Dura-Line and certain other Persons, as in effect on the date of
original Issuance of the Securities.
5
"Equity Interests" means Capital Stock or partnership interests or
warrants, options or other rights to acquire Capital Stock or partnership
interests (but excluding (i) any debt security that is convertible into, or
exchangeable for, Capital Stock or partnership interests, and (ii) any other
Indebtedness or Obligation); provided, however, that Equity Interests will not
include any Incentive Arrangements or obligations or payments thereunder.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"GAAP" means generally accepted accounting principles, consistently
applied, as of the date of original Issuance of the Securities. All financial
and accounting determinations and calculations under this indenture will be made
in accordance with GAAP.
"Hedging Obligations" means, with respect to any Person, the Obligations
of such Persons under (i) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements, (ii) foreign exchange contracts,
currency swap agreements or similar agreements, and (iii) other agreements or
arrangements designed to protect such Person against fluctuations, or otherwise
to establish financial xxxxxx in respect of, exchange rates, currency rates or
interest rates.
"Holder" means a Person in whose name a Security is registered.
"Incentive Arrangements" means any earn-out agreements, stock appreciation
rights, "phantom" stock plans, employment agreements, non-competition
agreements, subscription and stockholders agreements and other incentive and
bonus plans and similar arrangements made in connection with acquisitions of
Persons or businesses by the Company or the Restricted Subsidiaries or the
retention of executives, officers or employees by the Company or the Restricted
Subsidiaries.
"Indebtedness" means, with respect to any Person, any indebtedness,
whether or not contingent, in respect of borrowed money or evidenced by bonds,
notes debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or representing the deferred and unpaid balance
of the purchase price of any property (including pursuant to capital leases),
except any such balance that constitutes an accrued expense or a trade payable,
and any Hedging Obligations, if and to the extent such indebtedness (other than
a Hedging Obligation) would appear as a liability upon a balance sheet of such
Person prepared on a consolidated basis in accordance with GAAP, and also
includes, to the extent not otherwise included, the guarantee of items that
would be included within this definition; provided, however, that "Indebtedness"
will not include any Incentive Arrangements or obligations or payments
thereunder.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
bankruptcy or similar case or proceeding, or any reorganization, receivership,
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, or (ii) any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company.
"Issue" means create, issue, assume, guarantee, incur or otherwise become
directly or indirectly liable for any Indebtedness or Capital Stock, as
applicable; 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) shall be deemed to be issued
by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary.
For this definition, the terms "Issuing," "Issuer," "Issuance" and "Issued" have
meanings correlative to the foregoing.
6
"Jordan Stockholders" means Xxxx X. Xxxxxx, XX and/or his heirs, executors
and administrators, and/or The Xxxx X. Xxxxxx, XX Revocable Trust, The Jordan
Family Trust and/or any other trust established by Xxxx X. Xxxxxx, XX whose
beneficiaries are Xxxx X. Xxxxxx, XX and/or his lineal descendants or other
relatives.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell and any filing of or
agreement to give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York are not required to be open.
"Marketable Securities" means debt or equity securities of any Person
(other than the Company or any Affiliate) that are freely tradeable under all
applicable federal and state securities laws and that are either listed on a
national stock exchange or traded over the counter.
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP, excluding, however, any gain or
loss, together with any related provision for taxes, realized in connection with
any Asset Sale (including, without limitation, dispositions pursuant to sale and
leaseback transactions).
"Net Proceeds" means, with respect to any Asset Sale, the aggregate amount
of cash proceeds (including any cash received by way of deferred payment
pursuant to a note receivable Issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, and including
any amounts received as disbursements or withdrawals from any escrow or similar
account established in connection with any such Asset Sale, but, in either such
case, only as and when so received) received by the Company or any of its
Restricted Subsidiaries in respect of such Asset Sale, net of:
(i) the cash expenses of such Asset Sale (including, without limitation,
the payment of principal of, and premium, if any, and interest on,
Indebtedness required to be paid as a result of such Asset Sale
(other than the Securities) and legal, accounting and investment
banking fees and sales commissions),
(ii) taxes paid or payable as a result thereof,
(iii) any portion of cash proceeds that the Company determines in good
faith should be reserved for post-closing adjustments, it being
understood and agreed that on the day that all such post-closing
adjustments have been determined, the amount (if any) by which the
reserved amount in respect of such Asset Sale exceeds the actual
post-closing adjustments payable by the Company or any of its
Restricted Subsidiaries shall constitute Net Proceeds on such date,
and
(iv) any relocation expenses and pension, severance and shutdown costs
incurred as a result thereof.
"New Credit Agreement" means the credit agreement to be entered into by
the Company and/or certain of its Restricted Subsidiaries and certain lenders,
as amended, modified, extended, restated,
7
replaced or supplemented, from time to time, and any documents governing
refinancings or extensions of amounts borrowed thereunder.
"Non-Restricted Subsidiary" means J.I. Finance Company and any other
Subsidiary of the Company other than a Restricted Subsidiary.
"Obligations" means, with respect to any Indebtedness, all principal,
premiums, interest, penalties, fees, indemnities, expenses (including legal fees
and expenses), reimbursement obligations and other liabilities payable to the
holder of such Indebtedness under the documentation governing such Indebtedness,
and any other claims of such holder arising in respect of such Indebtedness.
"Officer" means the President, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
"Old Note Indenture" means the indenture, dated as of December 15, 1988,
between the Company and First Bank National Association, as trustee, as amended
or supplemented.
"Old Notes" means the Company's 13-7/8% Series A Senior Subordinated Notes
due 1998, and the Company's 16% Series B Senior Subordinated Reset Notes due
1998, each Issued under the Old Note Indenture.
"Opinion of Counsel" means a written opinion in form and substance
satisfactory to, and from legal counsel acceptable to, the Trustee (such counsel
may be an employee of or counsel to the Company or the Trustee).
"Other Permitted Indebtedness" means
(i) Indebtedness of the Company and its Restricted Subsidiaries existing
as of the date of original Issuance of the Securities (including Old
Notes, if any, the Discount Debentures and the Securities);
(ii) Indebtedness of the Company and its Restricted Subsidiaries in
respect of bankers acceptances and letters of credit (including,
without limitation, letters of credit in respect of workers'
compensation claims) Issued in the ordinary course of business, or
other indebtedness with respect to reimbursement-type obligations
regarding workers' compensation claims;
(iii) Refinancing Indebtedness, provided that:
(A) the principal amount of such Refinancing Indebtedness shall
not exceed the outstanding principal amount of Indebtedness
(including unused commitments) so extended, refinanced,
renewed, replaced, substituted or refunded plus any amounts
incurred to pay premiums, fees and expenses in connection
therewith;
(B) Refinancing Indebtedness of Indebtedness shall have a Weighted
Average Life to Maturity equal to or greater than the Weighted
Average Life to Maturity of the Indebtedness being extended,
refinanced, renewed, replaced, substituted or
8
refunded, provided that this clause (B) will not apply to
Refinancing Indebtedness Issued under the Credit Agreement or
the New Credit Agreement; and
(C) in the case of Refinancing Indebtedness of Subordinated
Indebtedness, such Refinancing Indebtedness shall be
subordinated to the Securities at least to the same extent as
the Indebtedness being extended, refinanced, renewed,
replaced, substituted or refunded;
(iv) intercompany Indebtedness of and among the Company and its
Restricted Subsidiaries (excluding guarantees by Restricted
Subsidiaries of Indebtedness of the Company not Issued in compliance
with Section 4.17);
(v) Indebtedness of the Company and its Restricted Subsidiaries Issued
in connection with making permitted Restricted Payments under
Sections 4.05(b)(iv), (b)(v) or (b)(ix);
(vi) Indebtedness of any Non-Restricted Subsidiary Issued after the date
of original Issuance of the Securities, provided that such
Indebtedness is nonrecourse to the Company and its Restricted
Subsidiaries and the Company and its Restricted Subsidiaries have no
Obligations with respect to such Indebtedness;
(vii) Indebtedness of the Company and its Restricted Subsidiaries under
Hedging Obligations;
(viii) Indebtedness of the Company and its Restricted Subsidiaries arising
from the honoring by a bank or other financial institution of a
check, draft or similar instrument inadvertently (except in the case
of daylight overdrafts, which will not be, and will not be deemed to
be, inadvertent) drawn against insufficient funds in the ordinary
course of business;
(ix) Indebtedness of any Person at the time it is acquired as a
Restricted Subsidiary, provided that such Indebtedness was not
Issued by such Person in connection with or in anticipation of such
acquisition;
(x) guarantees by Restricted Subsidiaries of Indebtedness of any
Restricted Subsidiary if the Indebtedness so guaranteed is permitted
under this Indenture;
(xi) guarantees by a Restricted Subsidiary of Indebtedness of the
Company, if the Indebtedness so guaranteed is permitted under this
Indenture and the Securities are guaranteed by such Restricted
Subsidiary to the extent required by Section 4.17;
(xii) guarantees by the Company of Indebtedness of any Restricted
Subsidiary if the Indebtedness so guaranteed is permitted under this
Indenture;
(xiii) Indebtedness of the Company and its Restricted Subsidiaries Issued
in connection with performance, surety, statutory, appeal or similar
bonds in the ordinary course of business; and
(xiv) Indebtedness of the Company and its Restricted Subsidiaries Issued
in connection with agreements providing for indemnification,
purchase price adjustments and similar obligations in connection
with the sale or disposition of any of their business, properties or
assets.
9
"Permitted Liens" means: (a) with respect to the Company and its
Restricted Subsidiaries,
(1) Liens for taxes, assessments, governmental charges or claims which
are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted and if a reserve or
other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor;
(2) statutory Liens of landlords and carriers', warehousemen's,
mechanics', suppliers', materialmen's, repairmen's or other like
Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by
appropriate proceedings, if a reserve or other appropriate
provision, if any as shall be required in conformity with GAAP shall
have been made therefor;
(3) Liens incurred on deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and
other types of social security;
(4) Liens incurred on deposits made to secure the performance of
tenders, bids, leases, statutory obligations, surety and appeal
bonds, government contracts, performance and return of money bonds
and other obligations of a like nature incurred in the ordinary
course of business (exclusive of obligations for the payment of
borrowed money);
(5) easements, rights-of-way, zoning or other restrictions, minor
defects or irregularities in title and other similar charges or
encumbrances not interfering in any material respect with the
business of the Company or any of its Restricted Subsidiaries
incurred in the ordinary course of business;
(6) Liens (including extensions, renewals and replacements thereof) upon
property acquired (the "Acquired Property") after the date of
original Issuance of the Securities, provided that:
(A) any such Lien is created solely for the purpose of securing
Indebtedness representing, or Issued to finance, refinance or
refund, the cost (including the cost of construction) of the
Acquired Property,
(B) the principal amount of the Indebtedness secured by such Lien
does not exceed 100% of the cost of the Acquired Property,
(C) such Lien does not extend to or cover any property other than
the Acquired Property and any improvements on such Acquired
Property, and
(D) the Issuance of the Indebtedness to purchase the Acquired
Property is permitted by Section 4.07;
(7) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with
the importation of goods;
(8) judgment and attachment Liens not giving rise to an Event of
Default;
(9) leases or subleases granted to others not interfering in any
material respect with the business of the Company or any of its
Restricted Subsidiaries;
10
(10) Liens encumbering customary initial deposits and margin deposits,
and other Liens incurred in the ordinary course of business and that
are within the general parameters customary in the industry, in each
case securing indebtedness under Hedging Obligations;
(11) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual or warranty requirements of the
Company or its Restricted Subsidiaries;
(12) Liens arising out of consignment or similar arrangements for the
sale of goods entered into by the Company or its Restricted
Subsidiaries in the ordinary course of business;
(13) any interest or title of a lessor in property subject to any Capital
Lease Obligation or operating lease;
(14) Liens arising from filing Uniform Commercial Code financing
statements regarding leases;
(15) Liens existing on the date of original Issuance of the Securities
and any extensions, renewals or replacements thereof; and
(16) any Lien granted to the Trustee under this Indenture and any
substantially equivalent Lien granted to any trustee or similar
institution under any indenture for Indebtedness permitted by the
terms of this Indenture;
(b) with respect to the Restricted Subsidiaries,
(1) Liens securing Restricted Subsidiaries' reimbursement Obligations
with respect to letters of credit that encumber documents and other
property relating to such letters of credit and the products and
proceeds thereof;
(2) Liens securing Indebtedness Issued by Restricted Subsidiaries if
such Indebtedness is permitted by (A) Section 4.07(a), (B) Sections
4.07(b)(i), (b)(ii), (b)(iii) or (b)(iv), or (C) clauses (i), (iii)
(to the extent the Indebtedness subject to such Refinancing
Indebtedness was subject to Liens), (vii), (ix) or (x) of the
definition of Other Permitted Indebtedness;
(3) Liens securing intercompany Indebtedness Issued by any Restricted
Subsidiary to the Company or another Restricted Subsidiary;
(4) additional Liens at any one time outstanding with respect to assets
of the Restricted Subsidiaries the aggregate fair market value of
which does not exceed $10,000,000 (the fair market value of any such
asset is to be determined on the date such Lien is granted on such
asset);
(5) Liens securing guarantees by Restricted Subsidiaries of Indebtedness
Issued by the Company if such guarantees are permitted by clause
(xi) (but only in respect of the property, rights and assets of the
Restricted Subsidiaries Issuing such guarantees) of the definition
of Other Permitted Indebtedness; and
11
(c) with respect to the Company,
(1) Liens securing Indebtedness Issued by the Company under the Credit
Agreement or the New Credit Agreement if such Indebtedness is
permitted by Section 4.07 (including, but not limited to,
Indebtedness Issued by the Company under the Credit Agreement or the
New Credit Agreement pursuant to Section 4.07(b)(i) and/or (b)(iv));
(2) Liens securing Indebtedness of the Company if such Indebtedness is
permitted by clauses (i), (iii) (to the extent the Indebtedness
subject to such Refinancing Indebtedness was subject to Liens) or
(vii) of the definition of Other Permitted Indebtedness; and
(3) Liens securing guarantees by the Company of Indebtedness Issued by
Restricted Subsidiaries if such Indebtedness is permitted by Section
4.07 (including, but not limited to, Indebtedness Issued by
Restricted Subsidiaries under the Credit Agreement or the New Credit
Agreement pursuant to Section 4.07(b)(i) and/or (b)(iv)) and if such
guarantees are permitted by clause (xii) (but only in respect of
Indebtedness Issued by the Restricted Subsidiaries under the Credit
Agreement or the New Credit Agreement pursuant to Section 4.07) of
the definition of Other Permitted Indebtedness;
provided, however, that, notwithstanding any of the foregoing, the Permitted
Liens referred to in clause (c) of this definition shall not include any Lien on
Capital Stock of Restricted Subsidiaries held by the Company (as distinguished
from Liens on Capital Stock of Restricted Subsidiaries held by other Restricted
Subsidiaries) other than Liens securing (A) Indebtedness of the Company Issued
under the Credit Agreement or the New Credit Agreement pursuant to Section 4.07
and any permitted Refinancing Indebtedness of such Indebtedness, and (B)
guarantees by the Company of Indebtedness Issued by Restricted Subsidiaries
under the Credit Agreement or the New Credit Agreement pursuant to Section 4.07
and any permitted Refinancing Indebtedness of such Indebtedness.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Post-Petition Interest" means, with respect to any Senior Indebtedness,
all interest accrued or accruing on such Senior Indebtedness after the
commencement of any Insolvency or Liquidation Proceeding in accordance with and
at the contract rate (including, without limitation, any rate applicable upon
default) specified in the agreement or instrument creating, evidencing or
governing such Senior Indebtedness, whether or not, pursuant to applicable law
or otherwise, the claim for such interest is allowed as a claim in such
Insolvency or Liquidation Proceeding.
"Preferred Stock" as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) that 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.
"Qualified Issuer" means any commercial bank (a) which has capital and
surplus in excess of $100,000,000, and (b) the outstanding long-term debt
securities of which are rated at least A-2 by Standard & Poor's Corporation or
P-2 by Xxxxx'x Investor Service, Inc., or carry an equivalent rating by a
nationally recognized rating agency if both of the two named rating agencies
cease publishing ratings of investments.
12
"Receivables" means, with respect to any Person all of the following
property and interests in property of such Person whether now existing or
existing in the future or hereafter acquired or arising: (i) accounts, (ii)
accounts receivable, (including, without limitation, all rights to payment
created by or arising from sales of goods, leases of goods or the rendition of
services, no matter how evidenced, whether or not earned by performance), (iii)
all unpaid seller's or lessor's rights (including without limitation, recession,
replevin, reclamation and stoppage in transit, relating to any of the foregoing
or arising therefrom), (iv) all rights to any goods or merchandise represented
by any of the foregoing (including, without limitation, returned or repossessed
goods), (v) all reserves and credit balances with respect to any such accounts
receivable or account debtors, (vi) all letters of credit, security or
guarantees of any of the foregoing, (vii) all insurance policies or reports
relating to any of the foregoing, (viii) all collection or deposit accounts
relating to any of the foregoing, (ix) all proceeds of any of the foregoing, and
(x) all books and records relating to any of the foregoing.
"Receivables Financing" means (i) the sale or other disposition of
Receivables that arise in the ordinary course of business, or (ii) the sale or
other disposition of Receivables that arise in the ordinary course of business
to a Receivables Subsidiary followed by a financing transaction in connection
with such sale or disposition of such Receivables.
"Receivables Subsidiary" means any Subsidiary of the Company or any other
corporation, trust or entity, that is exclusively engaged in Receivables
Financings and activities reasonably related thereto.
"Refinancing Indebtedness" means (i) Indebtedness of the Company and its
Restricted Subsidiaries Issued or given in exchange for, or the proceeds of
which are used to, extend, refinance, renew, replace, substitute or refund any
Indebtedness permitted under this Indenture or any Indebtedness Issued to so
extend, refinance, renew, replace, substitute or refund such Indebtedness, (ii)
any refinancings of Indebtedness Issued under the Credit Agreement or the New
Credit Agreement, and (iii) any additional Indebtedness Issued to pay premiums
and fees in connection with clauses (i) and (ii).
"Refinancing Plan" means (i) the repayment of all outstanding indebtedness
Issued under the Credit Agreement; (ii) the redemption of all the outstanding
Old Notes, including accrued interest thereon, whether pursuant to a debt tender
offer or Section 4.15; (iii) the payment of prepayment premiums on the Old Notes
and consent fees for the solicitation of consents to amendments to the Old
Indenture and the Old Notes from holders of Old Notes, and (iv) the payment of
fees and expenses relating to clauses (i), (ii), and (iii).
"Restricted Investment" means any capital contribution to, or other debt
or equity investment in (other than certain investments in marketable securities
and other negotiable instruments permitted by this Indenture) any Non-Restricted
Subsidiary or any Person other than a Restricted Subsidiary or the Company,
provided that Restricted Investments will not include any Incentive
Arrangements. The amount of any Restricted Investment shall be the amount of
cash and the fair market value at the time of transfer of all other property (as
determined by the Board of Directors in good faith) initially invested or paid
for such Restricted Investment, plus all additions thereto, without any
adjustments for increases or decreases in value of, or write-ups, write-downs or
write-offs with respect to, such Restricted Investment.
"Restricted Subsidiary" means:
(i) JII/Sales Promotion Associates, Inc., Imperial Electric Company
Xxxxxxx Precision Products, Inc., Sate-Lite Manufacturing Company,
Dura-Line Corporation, DACCO, Incorporated, Riverside Book and
Bible House, Incorporated, Xxxxx Motors, Inc. and Gear Research,
Inc., World Bible Publishers, Inc., Xxxxxxx Book Company., Inc., Aim
13
Electronics Corporation, Xxxxxx Lock, Inc., Beemak Plastics, Inc.,
Borg Manufacturing, Detroit Transmission Products Co., Transmission
Parts Warehouse, Inc., ABC Transmission Parts Warehouse, Inc.,
Nashville Transmission Parts Warehouse, Inc., Nashville Transmission
Parts Warehouse, Inc., DACCO/Detroit of Florida, Inc., DACCO/Detroit
of Minnesota, Inc., DACCO/Detroit of Colorado, Inc., DACCO/Detroit
of Indiana Inc., DACCO/Detroit of Missouri, Inc., DACCO/Detroit of
Memphis, Inc., DACCO/Detroit of Nebraska, Inc., DACCO/Detroit of
Alabama Inc., DACCO/Detroit of New Jersey, Inc., DACCO/Detroit of
Michigan, Inc., DACCO/Detroit of Arizona, Inc., DACCO/Detroit of
North Carolina, Inc., JI Aviation, Inc., Cambridge Products
Corporation, Welcome Home, Inc.,
(ii) any other Subsidiary of the Company existing on the date of original
Issuance of the Securities other than J.I. Finance Company, and
(iii) any other Subsidiary of the Company formed, acquired or existing
after the date of original Issuance of the Securities that is
designated as a "Restricted Subsidiary" by the Company pursuant to a
resolution approved by a majority of the Board of Directors.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Company's 10 3/8% Senior Notes due 2003 Issued
under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means:
(a) (i) all Obligations (including Post-Petition Interest) whether
existing on the date of original Issuance of the Securities or
Issued thereafter, in respect of:
(A) all Indebtedness of the Company for money borrowed, and
(B) all Indebtedness evidenced by notes, debentures, bonds
or other similar instruments for the payment of which
the Company is responsible or liable;
(ii) all Capitalized Lease Obligations of the Company;
(iii) all Obligations of the Company:
(A) for the reimbursement of any obligor on any letter of
credit, banker's acceptance or similar credit
transaction,
(B) constituting Hedging Obligations, or
(C) Issued as the deferred purchase price of property and
all conditional sale Obligations of the Company and all
Obligations of the Company under any title retention
agreement;
14
(iv) all guarantees of the Company with respect to Obligations of
other Persons of the type referred to in clauses (ii) and
(iii) and with respect to the payment of dividends of other
Persons; and
(v) all Obligations of the Company consisting of modifications,
renewals, extensions, replacements and refundings of any
Obligations described in clauses (i), (ii), (iii) or (iv);
unless, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is provided that such Obligations are subordinated
in right of payment to the Securities; provided, however, that Senior
Indebtedness shall not be deemed to include:
(1) any Obligation of the Company to any Subsidiary,
(2) any liability for federal, state, local or other taxes owed or
owing by the Company,
(3) any accounts payable or other liability to trade creditors
arising in the ordinary course of business (including
guarantees thereof or instruments evidencing such
liabilities),
(4) any Indebtedness, guarantee or Obligation of the Company that
is contractually subordinated or junior in any respect to any
other Indebtedness, guarantee or Obligation of the Company, or
(5) any Indebtedness incurred in violation of this Indenture.
(b) To the extent any payment of Senior Indebtedness, whether by or on
behalf of the Company, as proceeds of security or enforcement of any
right of setoff or otherwise, is declared to be fraudulent or
preferential, set aside or required to be paid to a trustee,
receiver or other similar Person under any Bankruptcy Law, then if
such payment is recovered by, or paid over to, such trustee,
receiver or other similar Person, the Senior Indebtedness or part
thereof originally intended to be satisfied by such payment shall he
deemed to be reinstated and outstanding as if such payment had not
occurred. All Senior Indebtedness shall be and remain Senior
Indebtedness for all purposes of this Indenture, whether or not
subordinated in an insolvency or Liquidation Proceeding.
"Significant Subsidiary" means (i) any Restricted Subsidiary of the
Company that would be a "significant subsidiary" as defined in clause (2) of the
definition of such term in Rule 1-02 of Regulation S-X under the Securities Act
and the Exchange Act, and (ii) any other Restricted Subsidiary of the Company
that is material to the business, earnings, prospects, assets or condition,
financial or otherwise, of the Company and its Restricted Subsidiaries taken as
a whole.
"SFAS 106" means Statement of Financial Accounting Standards No. 106.
"SFAS 109" means Statement of Financial Accounting Standards No. 109.
"Subordinated Indebtedness" means all Obligations of the type referred to
in clauses (i) through (v) of the definition of Senior Indebtedness if the
instrument creating or evidencing the same or pursuant
15
to which the same is outstanding designates such Obligations as being
subordinated or junior in right of payment to Senior Indebtedness.
"Subsidiary" of any Person means any entity of which the Equity Interests
entitled to cast at least a majority of the votes that may be cast by all Equity
Interests having ordinary voting power for the election of directors or other
governing body of such entity are owned by such Person (regardless of whether
such Equity Interests are owned directly by such Person or through one or more
Subsidiaries).
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code ss. ss.
77aaa-77bbbb) as in effect on the date of original Issuance of the Securities.
"Trustee" means First Trust National Association until a successor
replaces it in accordance with the applicable provisions of this Indenture 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.
"U.S. Government Obligations" means direct obligations of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged, provided that no U.S. Government Obligation
shall be callable at the Issuer's option.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the then
outstanding principal amount of such Indebtedness into (ii) the sum of the
product(s) obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other requirement payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment.
Section 1.02. Other Definitions.
Defined in
Term Section
"Affiliate Transaction" ............................... 4.08
"Asset Sale Disposition Date" ......................... 4.14
"Asset Sale Trigger Date" ............................. 4.14
"Change of Control Trigger Date" ...................... 4.13
"covenant defeasance option" .......................... 8.01
"Disposition" ......................................... 5.01
"Event of Default" .................................... 6.01
"Excess Proceeds" ..................................... 4.14
"legal defeasance option" ............................. 8.01
"Notice of Default" ................................... 6.01
"Offer" ............................................... 3.08
"Other Indebtedness" .................................. 4.17
"Other Indebtedness Guarantee" ........................ 4.17
"Paying Agent" ........................................ 2.03
"Purchase Date" ....................................... 3.08
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"Registrar" ......................................... 2.03
"Restricted Payments" ............................... 4.05
"Successor Corporation" ............................. 5.01
"Trustee Expenses" .................................. 6.08
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in, and made a part of, this Indenture. Any terms
incorporated by reference in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them therein.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein;
(2) an accounting term not otherwise defined herein has the
meaning assigned to it under GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular; and
(5) provisions apply to successive events and transactions.
ARTICLE 2
THE SECURITIES
Section 2.01. Form and Dating.
The Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is part of this Indenture. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule or usage. Each Security shall be dated the date of its
authentication. The Securities shall be in denominations of $1,000 and integral
multiples thereof.
The terms and provisions contained in the Securities shall constitute, and
are hereby expressly made, a part of this Indenture and to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
Section 2.02. Execution and Authentication.
Two officers shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Securities.
17
If an Officer whose signature is on a Security no longer holds that office
at the time the Security is authenticated, the Security shall nevertheless be
valid.
A Security shall not be valid until authenticated by the manual signature
of the Trustee, and the Trustee's signature shall be conclusive evidence that
the Security has been authenticated under this Indenture. The form of Trustee's
certificate of authentication to be borne by the Securities shall be
substantially as set forth in Exhibit A.
The Trustee shall, upon a written order of the Company signed by two
Officers, authenticate Securities for original Issuance up to an aggregate
principal amount stated in paragraph 4 of each Security (the aggregate principal
amount of outstanding Securities may not exceed that amount at any time, except
as provided in Section 2.07).
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Securities whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency (the "Registrar") where
Securities may be presented for registration of transfer or for exchange and an
office or agency (the "Paying Agent") where Securities may be presented for
payment. The Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company may appoint one or more co-registrars and one
or more additional paying agents. The term "Paying Agent" includes any
additional paying agent. The Company may change the Paying Agent, Registrar or
co-registrar without prior notice to any Holder. The Company shall notify the
Trustee and the Trustee shall notify the Holders of the name and address of any
Agent not a party to this Indenture. The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, and such
agreement shall incorporate the TIA's provisions and implement the provisions of
this Indenture that relate to such Agent.
The Company initially appoints the Trustee as Registrar, Paying Agent and
agent for service of notices and demands in connection with the Securities. The
Company or any of its Subsidiaries may act as Paying Agent, Registrar or
co-registrar. If the Company fails to appoint or maintain a Registrar and Paying
Agent, the Trustee shall act as such, and shall be entitled to appropriate
compensation in accordance with Section 7.07.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the Holders'
benefit or the Trustee all money the Paying Agent holds for redemption or
purchase of the Securities or for the payment of principal of, or premium, if
any, or interest on, the Securities, and will notify the Trustee of any Default
by the Company in providing the Paying Agent with sufficient funds to (i)
purchase Securities tendered pursuant to a Change of Control Offer, (ii) redeem
Securities called for redemption, or (iii) make any payment of principal,
premium or interest due on the Securities. While any such Default continues, the
Trustee may require the Paying Agent to pay all money it holds to the Trustee.
The Company at any time may require the Paying Agent to pay all money it holds
to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other
than the Company or any of its Subsidiaries) shall have no further liability for
the money it delivered to
18
the Trustee. If the Company or any of its Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the Holders' benefit or
the Trustee all money it holds as Paying Agent.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders and shall otherwise comply with section 312(a) of the TIA. If the
Trustee is not the Registrar, the Company shall furnish to the Trustee, at least
seven Business Days before each interest payment date and at such other times
as the Trustee may request in writing, a list in such form and as of such date
as the Trustee may reasonably require that sets forth the names and addresses
of, and the aggregate principal amount of Securities held by, each Holder, and
the Company shall otherwise comply with section 312(a) of the TIA.
Section 2.06. Transfer and Exchange.
When Securities are presented to the Registrar or a co-registrar with a
request to register a transfer or to exchange them for an equal principal amount
of Securities of other denominations, the Registrar shall register the transfer
or make the exchange if its requirements for such transactions are met;
provided, however, that any Security presented or surrendered for registration
of transfer or exchange shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar and the Trustee
duly executed by the Holder thereof or by his attorney duly authorized in
writing. To permit registrations of transfers and exchanges, the Company shall
Issue, and the Trustee shall authenticate, Securities at the Registrar's
request.
Neither the Company nor the Registrar shall be required to Issue, register
the transfer of, or exchange any Security (i) during a period beginning at the
opening of business on the day the Trustee receives notice of an optional
redemption from the Company pursuant to Section 3.02 and ending at the close of
business on the day the Securities or portions thereof to be redeemed are
selected by the Trustee, (ii) selected for redemption, in whole or in part,
except the unredeemed portion of any Security being redeemed in part, (iii)
prior to the Payment Date that has been tendered pursuant to an Offer and not
withdrawn, (iv) between the record date and the next succeeding interest payment
date.
No service charge shall be made for any registration of transfer or
exchange (except as otherwise expressly permitted herein), but the Company may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer tax or similar governmental charge payable upon exchanges pursuant to
Section 2.10, 3.06, 3.08, or 9.05, which the Company shall pay).
Prior to due presentment for registration of transfer of any Security, the
Trustee, any Agent and the Company may deem and treat the Person in whose name
any Security is registered as the absolute owner of such Security (whether or
not such Security shall be overdue and notwithstanding any notation of ownership
or other writing on such Security made by anyone other than the Company, the
Registrar or any co-registrar) for the purpose of receiving payment of principal
of, and premium, if any, and interest on, such Security and for all other
purposes, and notice to the contrary shall not affect the Trustee, any Agent or
the Company.
Section 2.07. Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or if the Company
and the Trustee receive evidence to their satisfaction of the destruction, loss
or theft of any Security, the Company shall Issue
19
and the Trustee, upon the Company's written order signed by two Officers, shall
authenticate a replacement Security if the Trustee's requirements are met. If
the Trustee or the Company requires, the Holder must supply an indemnity bond
that is sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent or any authenticating agent from any loss that
any of them may suffer if a Security is replaced. The Company and the Trustee
may charge for its expenses in replacing a Security.
Every replacement Security is an additional Obligation of the Company.
Section 2.08. Outstanding Securities.
The Securities outstanding at any time are all the Securities the Trustee
has authenticated except for those it has cancelled, those delivered to it for
cancellation, and those described in this Section as not outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that a bonafide
purchaser holds the replaced Security.
If the entire principal of, and premium, if any, and accrued interest on,
any Security is considered paid under Section 4.01, it ceases to be outstanding
and interest on it ceases to accrue.
Subject to Section 2.09, a Security does not cease to be outstanding
because the Company or an Affiliate holds the Security.
Section 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that the Trustee knows are so owned shall be so disregarded.
Notwithstanding the foregoing, Securities that the Company or an Affiliate
offers to purchase or acquires pursuant to an Offer, exchange offer, tender
offer or otherwise shall not be deemed to be owned by the Company or an
Affiliate until legal title to such Securities passes to the Company or such
Affiliate, as the case may be.
Section 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee, upon
receipt of the Company's written order signed by two Officers, shall
authenticate definitive Securities in exchange for temporary Securities. Until
such exchange, temporary Securities shall be entitled to the same rights,
benefits and privileges as definitive Securities.
Section 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar, any co-registrar and the Paying Agent shall forward
to the Trustee any Securities surrendered to them for registration of transfer,
exchange, replacement, payment (including all Securities called for redemption
20
and all Securities accepted for payment pursuant to an Offer) or cancellation,
and the Trustee shall cancel all such Securities and shall destroy all cancelled
Securities (subject to the Exchange Act's record retention requirements) and
deliver a certificate of their destruction to the Company unless by written
order, signed by two Officers of the Company, the Company shall direct that
cancelled Securities be returned to it. The Company may not Issue new Securities
to replace any Securities that have been cancelled by the Trustee or that have
been delivered to the Trustee for cancellation. If the Company or an Affiliate
acquires any Securities (other than by redemption or pursuant to an Offer), such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Securities unless and until such Securities are
delivered to the Trustee for cancellation.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to Holders on a subsequent
special record date, in each case at the rate provided in the Securities and
Section 4.01. The Company shall, with the Trustee's consent, fix or cause to be
fixed each such special record date and payment date. At least 15 days before
the special record date, the Company (or the Trustee, in the name of and at the
expense of the Company) shall mail a notice that states the special record date,
the related payment date and the amount of interest to be paid.
Section 2.13. Record Date.
The record date for purposes of determining the identity of holders of
Securities entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in section 316(c) of the TIA.
Section 2.14. CUSIP Number.
A "CUSIP" number will be printed on the Securities, and the Trustee shall
use the CUSIP number in notices of redemption, purchase or exchange as a
convenience to Holders, provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Securities and that reliance may be placed only
on the other identification numbers printed on the Securities. The Company will
promptly notify the Trustee of any change in the CUSIP number.
ARTICLE 3
OPTIONAL REDEMPTION AND MANDATORY OFFERS TO PURCHASE
Section 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant to Section 3.07 it
shall furnish to the Trustee, at least 10 but not more than 15 days before
notice of redemption is to be mailed by the Company to Holders, an Officers'
Certificate stating that the Company has elected to redeem Securities pursuant
to Section 3.07(a) or 3.07(b), as the case may be, the date notice of redemption
is to be mailed to Holders, the redemption date, the aggregate principal amount
of Securities to be redeemed, the redemption price for such Securities and the
amount of accrued and unpaid interest on such Securities as of the redemption
date. If the Trustee is not the Registrar, the Company shall, concurrently with
delivery of its notice to the Trustee of a redemption, cause the Registrar to
deliver to the Trustee a certificate (upon which the
21
Trustee may rely) setting forth the name of, and the aggregate principal amount
of Securities held by, each Holder.
If the Company is required to offer to purchase Securities pursuant to
Section 4.13 or 4.14, it shall furnish to the Trustee, at least 2 Business Days
before notice of the Offer is to be mailed to Holders, an Officers' Certificate
setting forth that the Offer is being made pursuant to Section 4.13 or 4.14, as
the case may be, the Purchase Date, the maximum principal amount of Securities
the Company is offering to purchase pursuant to the Offer, the purchase price
for such Securities, and the amount of accrued and unpaid interest on such
Securities as of the Purchase Date.
The Company will also provide the Trustee with any additional information
that the Trustee reasonably requests in connection with any redemption or Offer.
Section 3.02. Selection of Securities to be Redeemed or Purchased.
If less than all outstanding Securities are to be redeemed or if less than
all Securities tendered pursuant to an Offer are to be accepted for payment, the
Trustee shall select the outstanding Securities to be redeemed or accepted for
payment pro rata, by lot or by a method that complies with the requirements of
any stock exchange on which the Securities are listed and that the Trustee
considers fair and appropriate. If the Company elects to mail notice of a
redemption to Holders, the Trustee shall at least 5 business days prior to the
date notice of redemption is to be mailed, (i) select the Securities to be
redeemed from Securities outstanding not previously called for redemption, and
(ii) notify the Company of the names of each Holder of Securities selected for
redemption, the principal amount of Securities held by each such Holder and the
principal amount of such Holder's Securities that are to be redeemed. If less
than all Securities tendered pursuant to an Offer on the Purchase Date are to be
accepted for payment, the Trustee shall select on or promptly after the Purchase
Date the Securities to be accepted for payment. The Trustee shall select for
redemption or purchase Securities or portions of Securities in principal amounts
of $1,000 or integral multiples of $1,000; except that if all of the Securities
of a Holder are selected for redemption or purchase, the aggregate principal
amount of the Securities held by such Holder, even if not a multiple of $1,000,
shall be redeemed or purchased. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Securities called for redemption or
tendered pursuant to an Offer also apply to portions of Securities called for
redemption or tendered pursuant to an Offer. The Trustee shall notify the
Company promptly of the Securities or portions of Securities to be called for
redemption or selected for purchase.
Section 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date, the
Company shall mail a notice of redemption to each Holder of Securities or
portions thereof that are to be redeemed.
The notice shall identify the Securities or portions thereof to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price for the Securities and the amount of
unpaid and accrued interest on such Securities as of the date
of redemption;
(3) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that,
after the redemption date, upon surrender
22
of such Security, a new Security or Securities in principal
amount equal to the unredeemed portion will be Issued;
(4) the name and address of the Paying Agent;
(5) that Securities called for redemption must be surrendered to
the Paying Agent to collect the redemption price for, and any
accrued and unpaid interest on, such Securities;
(6) that, unless the Company defaults in making such redemption
payment, interest on Securities called for redemption ceases
to accrue on and after the redemption date;
(7) the paragraph of the Securities pursuant to which the
Securities called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number listed in such notice and printed
on the Securities.
At the Company's request, the Trustee shall (at the Company's expense)
give the notice of redemption in the Company's name at least 30 but not more
than 60 days before a redemption; provided, however, that the Company shall
deliver to the Trustee, at least 45 days prior to the redemption date and at
least 10 days prior to the date that notice of the redemption is to be mailed
to Holders, an Officers' Certificate that (i) requests the Trustee to give
notice of the redemption to Holders, (ii) sets forth the information to be
provided to Holders in the notice of redemption, as set forth in the preceding
paragraph, (iii) states that the Company has elected to redeem Securities
pursuant to Section 3.07(a) or 3.07(b), as the case may be, and (iv) sets forth
the aggregate principal amount of Securities to be redeemed and the amount of
accrued and unpaid interest thereon as of the redemption date. If the Trustee is
not the Registrar, the Company shall, concurrently with any such request, cause
the Registrar to deliver to the Trustee a certificate (upon which the Trustee
may rely) setting forth the name of, the address of, and the aggregate principal
amount of Securities held by, each Holder.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed, Securities called for redemption
become due and payable on the redemption date at the price set forth in the
Security.
Section 3.05. Deposit of Redemption Price.
On or prior to any redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price
of, and accrued interest on, all Securities to be redeemed on that date. The
Trustee or the Paying Agent shall return to the Company any money that the
Company deposited with the Trustee or the Paying Agent in excess of the amounts
necessary to pay the redemption price of, and accrued interest on, all
Securities to be redeemed.
If the Company complies with the preceding paragraph, interest on the
Securities to be redeemed will cease to accrue on such Securities on the
applicable redemption date, whether or not such Securities are presented for
payment. If a Security is redeemed on or after an interest record date but on or
prior to the related interest payment date, then any accrued and unpaid interest
shall be paid to the Person in whose name such Security was registered at the
close of business on such record date. If any Security
23
called for redemption shall not be so paid upon surrender for redemption because
of the failure of the Company to comply with the preceding paragraph, interest
will be paid on the unpaid principal, premium, if any, and interest from the
redemption date until such principal, premium and interest is paid, at the rate
of interest provided in the Securities and Section 4.01.
Section 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Company shall
Issue and the Trustee shall authenticate for the Holder at the Company's expense
a new Security equal in principal amount to the unredeemed portion of the
Security surrendered.
Section 3.07. Optional Redemption Provisions.
The Securities may not be redeemed at the option of the Company prior to
August 1, 1998. During the twelve (12) month period beginning August 1 of the
years indicated below, the Securities will be redeemable at the option of the
Company, in whole or in part, on at least 30 but not more than 60 days' notice
to each Holder to be redeemed, at the redemption prices (expressed as
percentages of the principal amount of the Securities) set forth below, plus any
accrued and unpaid interest to the date of redemption:
Year Percentage
---- ----------
1998 ................................... 105.18750%
1999 ................................... 102.59375%
2000 and thereafter .................... 100.00000%
Section 3.08. Mandatory Purchase Provisions.
(a) Within 30 days after any Change of Control Trigger Date or Asset Sale
Trigger Date, the Company shall mail a notice to each Holder stating:
(i) that an offer ("Offer") is being made pursuant to Section 4.13 or
4.14, as the case may be, the length of time the Offer shall remain
open, and the maximum aggregate principal amount of Securities that
the Company is offering to purchase;
(ii) the purchase price for the Securities (as set forth in Section 4.13
or 4.14, as the case may be), the amount of accrued and unpaid
interest on such Securities as of the purchase date, and the
purchase date (which shall be no earlier than 30 days nor later
than 40 days from the date such notice is mailed (the "Purchase
Date"));
(iii) that any Security not accepted for payment will continue to accrue
interest;
(iv) that, unless the Company fails to deposit with the Paying Agent on
the Purchase Date an amount sufficient to purchase all Securities
accepted for payment, interest shall cease to accrue on such
Securities after the Purchase Date;
(v) that Holders electing to tender any Security or portion thereof will
be required to surrender their Security, with a form entitled
"Option of Holder to Elect Purchase" completed, to the Paying Agent
at the address specified in the notice prior to the close of
business on the Business Day preceding the Purchase Date, provided
that Holders
24
electing to tender only a portion of any Security must tender a
principal amount of $1,000 or integral multiples thereof;
(vi) that Holders will be entitled to withdraw their election to tender
Securities if the Paying Agent receives, not later than the close of
business on the third Business Day preceding the Purchase Date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Securities delivered for
purchase, and a statement that such Holder is withdrawing his
election to have such Security purchased; and
(vii) that Holders whose Securities are accepted for payment in part will
be Issued new Securities equal in principal amount to the
unpurchased portion of Securities surrendered; provided that only
Securities in a principal amount of $1,000 or integral multiples
thereof will be accepted for payment in part.
(b) On the Purchase Date, the Company will, to the extent required by this
Indenture and the Offer:
(i) accept for payment the Securities or portions thereof tendered
pursuant to such Offer,
(ii) deposit with the Paying Agent an amount sufficient to purchase the
lesser of (a) the Securities or portions thereof tendered pursuant
to such Offer, and (b) the maximum aggregate principal amount of
Securities that the Company offered to purchase pursuant to such
Offer, and
(iii) deliver, or cause to be delivered, to the Trustee all Securities
tendered pursuant to the Offer, together with an Officers'
Certificate setting forth the name of each Holder that tendered
Securities and the principal amount of the Securities or portions
thereof tendered by each such Holder.
(c) With respect to any Offer, if less than all of the Securities tendered
pursuant to an Offer are to be purchased by the Company, the Trustee shall
select on the Purchase Date the Securities or portions thereof to be accepted
for payment pursuant to Section 3.02.
(d) Promptly after consummation of an Offer, (i) the Paying Agent shall mail to
each Holder of Securities or portions thereof accepted for payment an amount
equal to the purchase price for, plus any accrued and unpaid interest on, such
Securities, (ii) with respect to any tendered Security not accepted for payment
in whole or in part, the Trustee shall return such Security to the Holder
thereof, and (iii) with respect to any Security accepted for payment in part,
the Trustee shall authenticate and mail to each such Holder a new Security equal
in principal amount to the unpurchased portion of the tendered Security.
(e) The Company will publicly announce the results of the Offer on or as soon as
practicable after the Purchase Date.
(f) The Company will comply with Rule 14e-1 under the Exchange Act and any other
securities laws and regulations to the extent such laws and regulations are
applicable to any Offer.
25
(g) With respect to any Offer, if the Company deposits with the Paying Agent on
the Purchase Date an amount sufficient to purchase all Securities accepted for
payment, interest shall cease to accrue on such Securities after the Purchase
Date; provided, however, that if the Company fails to deposit such amount on the
Purchase Date, interest shall continue to accrue on such Securities until such
deposit is made.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Securities.
The Company shall pay the principal of, and premium, if any, and interest
on, the Securities on the dates and in the manner provided in the Securities.
Holders of Securities must surrender their Securities to the Paying Agent to
collect principal payments. Principal, premium, and interest shall be considered
paid on the date due if the Paying Agent (other than the Company or any of its
Subsidiaries) holds as of 10:00 a.m. Eastern Standard Time money the Company
deposited in immediately available funds designated for and sufficient to pay
all principal, premium, if any, and interest then due. The Paying Agent shall
return to the Company, no later than five days following the date of payment,
any money (including accrued interest) that exceeds the amount of principal,
premium, if any, and interest paid on the Securities.
To the extent lawful, the Company shall pay interest (including
Post-Petition Interest) on (i) overdue principal and premium at the rate equal
to 2% per annum in excess of the then applicable interest rate on the
Securities, compounded semiannually, and (ii) overdue installments of interest
(without regard to any applicable grace period) at the same rate as set forth in
clause (i), compounded semiannually.
Section 4.02. SEC Reports.
(a) The Company shall file with the Trustee, within 15 days after it files them
with the SEC, copies of the annual reports and of 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 the Company is required to file with
the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the Company is
not subject to the requirements of Section 13 or 15(d) of the Exchange Act, the
Company shall file with the Trustee, within 15 days after it would have been
required to file with the SEC, financial statements, including any notes thereto
(and with respect to annual reports, an auditor's report by a firm of
established national reputation reasonably satisfactory to the Trustee), and a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," both comparable to that which the Company would have been required
to include in such annual reports, information, documents or other reports if
the Company were subject to the requirements of Section 13 or 15(d) of the
Exchange Act. Subsequent to the qualification of the Indenture under the TIA,
the Company also shall comply with the provisions of section 314(a) of the TIA.
(b) If the Company is required to furnish annual or quarterly reports to its
stockholders pursuant to the Exchange Act, the Company shall cause any annual
report furnished to its stockholders generally and any quarterly or other
financial reports it furnishes to its stockholders generally to be filed with
the Trustee and mailed to the Holders at their addresses appearing in the
register of Securities maintained by the Registrar. If the Company is not
required to furnish annual or quarterly reports to its stockholders pursuant to
the Exchange Act, the Company shall cause its financial statements referred to
in Section 4.02(a), including any notes thereto (and with respect to annual
reports, an auditors' report by a firm of established national reputation
reasonably satisfactory to the Trustee), and a "Management's Discussion and
Analysis of Financial Condition and Results of Operations," to be so mailed to
the Holders within
26
120 days after the end of each of the Company's fiscal years and within 60
days after the end of each of the first three fiscal quarters of each year. The
Company will cause to be disclosed in a statement accompanying any annual report
or comparable information as of the date of the most recent financial statements
in each such report or comparable information the amount available for payments
pursuant to Section 4.05 hereof. As of the date hereof, the Company's fiscal
year ends on December 31.
Section 4.03. 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 a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions hereof
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company has taken or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of, or
premium, if any, or interest on, the Securities are prohibited or if such event
has occurred, a description of the event and what action the Company is taking
or proposes to take with respect thereto.
So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the financial statements
delivered pursuant to Section 4.02 shall be accompanied by a written statement
of the Company's independent public accountants (who shall be a firm of
established national reputation reasonably satisfactory to the Trustee) that in
making the examination necessary for certification of such financial statements
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Section 4.01, 4.05, 4.06, 4.07, 4.08,
4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, or 4.17 or of Article 5 or, if
any such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
The Company will, so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of (i) any
Default or Event of Default, or (ii) any default or event of default under any
other mortgage, indenture of instrument that could result in an Event of Default
under Section 6.01(4), an Officers' Certificate specifying such Default, Event
of Default or default and what action the Company is taking or proposes to take
with respect thereto.
Section 4.04. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that might affect the covenants
or the performance of this Indenture; and the Company (to the extent it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not, by resort to any such law, hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law has been
enacted.
27
Section 4.05. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly,
(i) declare or pay any dividend or make any distribution on account of
the Company's or such Restricted Subsidiary's Capital Stock or other
Equity Interests (other than dividends or distributions payable in
Equity Interests (other than Disqualified Stock) of the Company or a
Restricted Subsidiary and other than dividends or distributions
payable by a Restricted Subsidiary to another Restricted Subsidiary
or to the Company),
(ii) purchase, redeem or otherwise acquire or retire for value any Equity
Interests of the Company or any of its Restricted Subsidiaries
(other than any such Equity Interest purchased from the Company or
any Restricted Subsidiary),
(iii) voluntarily prepay Indebtedness that is subordinated to the
Securities, whether any such Subordinated Indebtedness is
outstanding on, or issued after, the date of original issuance of
the Securities, except as specifically permitted by the terms of
this Indenture,
(iv) make any Restricted Investment (all such dividends, distributions,
purchases, redemptions or other acquisition, retirements,
prepayments and Restricted Investments being collectively referred
to as "Restricted Payments"), if, at the time of such Restricted
Payment:
(1) a Default or Event of Default shall have occurred and be
continuing or shall occur as a consequence thereof; or
(2) immediately after such Restricted Payment and after giving
effect thereto on a pro forma basis, the Company shall not be
able to Issue $l.00 of additional Indebtedness pursuant to
Section 4.07(a); or
(3) such Restricted Payment, together with the aggregate of all
other Restricted Payments made after the date of original
Issuance of the Securities, exceeds the sum of, without
duplication:
(A) 50% of the aggregate Consolidated Net Income (including,
for this purpose, gains from Asset Sales and, to the
extent not already included in the aggregate
Consolidated Net Income, gains from Restricted
Investments shall be added to the aggregate Consolidated
Net Income) of the Company (or, in case such aggregate
is a loss, 100% of such loss) for the period (taken as
one accounting period) from the beginning of the first
quarter commencing immediately after the date of
original Issuance of the Securities and ended as of the
Company's most recently ended fiscal quarter at the time
of such Restricted Payment, plus
(B) 100% of the aggregate net cash proceeds and the fair
market value of any property or securities (as
determined by the Board of Directors in good faith)
received by the Company from the Issue or sale of Equity
Interests or warrants, options or rights to acquire
Equity Interests of the Company or any Restricted
Subsidiary subsequent to the date of original
28
Issuance of the Securities (other than Equity Interests
Issued or sold to a Restricted Subsidiary and other than
Disqualified Stock), plus
(C) $5,000,000, plus
(D) the amount by which the principal amount of and any
accrued interest on:
(1) any Senior Indebtedness of the Company, or
(2) any Indebtedness of the Restricted Subsidiaries,
is reduced on the Company's consolidated balance sheet
upon the conversion or exchange (other than by a
Restricted Subsidiary) subsequent to the date of
original Issuance of the Securities of any indebtedness
of the Company or any Restricted Subsidiary (not held by
the Company or any Restricted Subsidiary) for Equity
Interests (other than Disqualified Stock) of the Company
or any Restricted Subsidiaries (less the amount of any
cash, or the fair market value of any other property or
securities (as determined by the Board of Directors in
good faith), distributed by the Company or any
Restricted Subsidiary (to Persons other than the Company
or any other Restricted Subsidiary) upon such conversion
or exchange), plus
(F) if any Non-Restricted Subsidiary is redesignated as a
Restricted Subsidiary, the fair market value (as
determined by the Board of Directors in good faith) of
such Non-Restricted Subsidiary as of the date it is
redesignated; provided, however, that for purposes of
this clause (E), the fair market value of any
redesignated Non-Restricted Subsidiary shall be reduced
by the amount that any such redesignation replenishes or
increases the amount of Restricted Investments permitted
to be made pursuant to Section 4.05(b)(iii).
(b) Notwithstanding Section 4.05(a), the following Restricted Payments may be
made:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment
would comply with the provisions hereof;
(ii) the retirement of any of the Company's Capital Stock or Subordinated
Indebtedness in exchange for, or out of the net proceeds of the
substantially concurrent sale (other than to a Restricted
Subsidiary) of, other Capital Stock (other than Disqualified Stock)
and neither such retirement nor the proceeds of any such sale or
exchange shall be included in any computation made pursuant to
Section 4.05(a);
(iii) making Restricted Investments at any time, and from time to time, in
an aggregate outstanding amount of $40,000,000 after the date of
original Issuance of the Securities (it being understood that if any
Restricted Investment acquired with a Restricted Payment after the
date of original Issuance of the Securities pursuant to this clause
(iii) is sold, transferred or otherwise conveyed to any Person other
than the Company or a Restricted Subsidiary, the portion of the net
cash proceeds or fair market value of securities or
29
properties paid or transferred to the Company and its Restricted
Subsidiaries in connection with such sale, transfer or conveyance
that relates to the repayment or return of the original cost of such
a Restricted Investment will replenish or increase the amount of
Restricted Investments permitted to be made pursuant to this Section
4.05(b)(iii), so that up to $40,000,000 of Restricted Investments may
be outstanding under this Section 4.05(b)(iii) at any given time);
(iv) the repurchase or redemption of the Company's common stock upon the
death of Xxxxxx X. Xxxxx, pursuant to the terms of an Employment
Agreement, dated as of February 25, 1988, between the Company and
Xxxxxx X. Xxxxx, as amended or supplemented; provided, however, that
the funds necessary to satisfy the Company's obligation to
repurchase or redeem such Common Stock shall be fully reimbursed by
insurance;
(v) the repurchase or redemption of the Company's common stock pursuant
to the terms of the several Restricted Stock Agreements, each dated
as of February 25, 1988, between the Company and each of Xxxxxx X.
Xxxxx, Xxxxxxxx X. Xxxxxxx and Xxxx X. Xxxxxx, the Restricted Stock
Agreement, dated as of December 31, 1992, between the Company and
Xxxxxx Xxxxx and the Restricted Stock Agreements, each dated as of
January 1, 1992, between the Company and each of Xxxxxxxx X.
Xxxxxxx, Xxxx Max and Xxxxxx Xxxxx, in each case as amended or
supplemented, up to an aggregate amount not to exceed $7,500,000;
(vi) any loans, advances, distributions or payments from the Company to
its Restricted Subsidiaries, or any loans, advances, distributions
or payments by a Restricted Subsidiary to the Company or to another
Restricted Subsidiary, pursuant to intercompany Indebtedness,
intercompany management agreements, intercompany tax sharing
agreements, and other intercompany agreements and obligations;
(vii) the payment of directors' fees in an annual aggregate amount not to
exceed $250,000;
(viii) investments in marketable securities and other negotiable
instruments through the Xxxxxxx Penn Funds (including the Xxxxxxx
Penn Interest Income Fund);
(ix) scheduled payments of dividends on, and redemptions of,
(A) the Preferred Stock of Sate-Lite in an annual aggregate amount
not to exceed $20,000, and
(B) the Preferred Stock of Dura-Line,
(1) in an aggregate annual amount not to exceed $300,000 for
dividends, and
(2) in an aggregate amount not to exceed $3,750,000 for
redemptions pursuant to the terms of the Dura-Line
Agreement;
(x) to the extent constituting Restricted Payments, if no Default or
Event of Default shall have occurred and be continuing or shall
occur as a consequence thereof, the payment of consulting, financial
and investment banking fees (but not limiting the payment of
indemnities, expenses and other amounts) under the Consulting
Agreement, provided that
30
the obligation of the Company to pay such fees under the Consulting
Agreement shall be subordinated expressly to the Company's
Obligations on the Securities;
(xi) the purchase, redemption, retirement or other acquisition of (a) any
Senior Indebtedness required by its terms to be purchased, redeemed,
retired or acquired with the net proceeds from asset sales (as
defined in the instrument evidencing such Senior Indebtedness) or
upon a change of control (as defined in the instrument evidencing
such Senior Indebtedness), and (b) the Securities pursuant to
Sections 4.13 and 4.14;
(xii) the exchanging, refinancing or refunding of Subordinated
Indebtedness through the Issuance of Subordinated Indebtedness so
long as the Subordinated Indebtedness to be Issued is Refinancing
Indebtedness permitted under Section 4.07; or
(xiii) any payments made in connection with the Refinancing Plan.
Section 4.06. Corporate Existence.
Subject to Section 4.14 and Article 5 hereof, 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 the corporate, partnership or other existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of each of its Restricted Subsidiaries and the rights
(charter and statutory), licenses and franchises of the Company and each of its
Restricted Subsidiaries; provided, however, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any Restricted Subsidiary, if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and its Restricted Subsidiaries
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders.
Section 4.07. Limitation on Incurrence of Indebtedness.
(a) The Company will not, and will not permit any Restricted Subsidiary to Issue
any Indebtedness (other than the Indebtedness represented by the Discount
Debentures, the Old Notes and the Securities) unless: the Company's Cash Flow
Coverage Ratio for its four full fiscal quarters next preceding the date such
additional Indebtedness is Issued would have been at least:
(i) 1.7 to 1, if such date is between the date of original Issuance of
the Securities and June 30, 1995,
(ii) 1.85 to 1, from July 1, 1995 through June 30, 1997, or
(iii) 2.0 to 1, from July 1, 1997 and thereafter,
in each case determined on a pro forma basis (including a pro forma
application of proceeds of such Indebtedness and any other
Indebtedness incurred since the end of the applicable four quarter
period including, without limitation, the earnings of any business
acquired by the Company with the proceeds of such Indebtedness) as
if such additional Indebtedness and any other Indebtedness issued
since the end of the applicable four quarter period had been Issued
at the beginning of such four-quarter period.
31
(b) Section 4.07(a) will not apply to the Issuance of:
(i) Indebtedness of the Company and/or its Restricted Subsidiaries up to
the greater of (A) $75.0 million in aggregate principal amount
pursuant to the Credit Agreement or the New Credit Agreement, and
(B) an aggregate principal amount up to the sum of: (x) 85% of the
book value of the Company and its Restricted Subsidiaries'
Receivables on a consolidated basis, and (y) 65% of the book value
of the Company and its Restricted Subsidiaries' inventories on a
consolidated basis;
(ii) Indebtedness of the Company and its Restricted Subsidiaries pursuant
to any Receivables Financing;
(iii) Indebtedness of the Company and its Restricted Subsidiaries in
connection with capital leases, sale and leaseback transactions,
purchase money obligations, capital expenditures or similar
financing transactions relating to:
(A) their properties, assets and rights as of the date of original
Issuance of the Securities up to $20,000,000 in aggregate
principal amount, or
(B) their properties, assets and rights acquired after the date of
original Issuance of the Securities, provided that such
Indebtedness under this Section 4.07(b)(iii)(B) does not
exceed 100% of the cost of such properties, assets and rights;
(iv) additional Indebtedness of the Company and its Restricted
Subsidiaries in an aggregate principal amount up to $25,000,000 (all
or any portion of which may be Issued as additional Indebtedness
under the Credit Agreement or the New Credit Agreement); and
(v) Other Permitted Indebtedness.
(c) Notwithstanding Sections 4.07(a) and (b), no Restricted Subsidiary shall
under any circumstances Issue a guarantee of any Indebtedness of the Company
except for guarantees Issued by Restricted Subsidiaries pursuant to Section
4.17, provided, however, that this Section 4.07(c) will not limit or restrict
guarantees Issued by Restricted Subsidiaries in respect of Indebtedness of other
Restricted Subsidiaries.
Section 4.08. Limitation on Transactions With Affiliates.
(a) Neither the Company nor any of its Restricted Subsidiaries may make any
loan, advance, guarantee or capital contribution to, or for the benefit of, or
sell, lease, transfer or dispose of any properties or assets to, or for the
benefit of, or purchase or lease any property or assets from, or enter into any
or amend any contract, agreement or understanding with, or for the benefit of,
an Affiliate (each such transaction or series of related transactions that are
part of a common plan an "Affiliate Transaction"), except in good faith and on
terms that are no less favorable to the Company or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable transaction
on an arm's length basis from an unrelated Person.
(b) Neither the Company nor any of its Restricted Subsidiaries may engage in any
Affiliate Transaction involving aggregate payments or other transfers by the
Company and its Restricted Subsidiaries in excess of $5,000,000 (including cash
and non-cash payments and benefits valued at their fair market value by the
Board of Directors in good faith) unless the Company delivers to the Trustee
32
(i) a resolution of the Board of Directors stating that the Board of Directors
(including a majority of the disinterested directors, if any) has, in good
faith, determined that such Affiliate Transaction complies with the provisions
of this Indenture, and (ii) an opinion as to the fairness of such Affiliate
Transaction to the Company or such Restricted Subsidiary from a financial point
of view by an investment banking firm of national prominence that is not an
Affiliate.
(c) Notwithstanding Sections 4.08(a) and (b), this Section 4.08 will not apply
to:
(i) transactions between the Company and any Restricted Subsidiary or
between Restricted Subsidiaries,
(ii) any payments or transactions permitted pursuant to Section 4.05,
(iii) payments of fees and other amounts due under the Consulting
Agreement, and
(iv) the payment of reasonable and customary directors' fees to directors
of the Company and its Restricted Subsidiaries.
Section 4.09. Limitation on Liens.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien (other than Permitted Liens) upon any asset now owned or
hereafter acquired by them, or any income or profits therefrom or assign or
convey any right to receive income therefrom; provided, however, that in
addition to creating Permitted Liens on its properties or assets, the Company
may create any Lien upon any of its properties or assets (including, but not
limited to, any Capital Stock of its Subsidiaries) if the Securities are equally
and ratably secured.
Section 4.10. Compliance With Laws, Taxes.
The Company shall, and shall cause each of its Restricted Subsidiaries to,
comply with all statutes, laws, ordinances, or government rules and regulations
to which it is subject, non-compliance with which would materially adversely
affect the business, prospects, earnings, properties, assets or condition,
financial or otherwise, of the Company and its Restricted Subsidiaries taken as
a whole.
The Company shall, and shall cause each of its Restricted Subsidiaries to,
pay prior to delinquency all taxes, assessments and governmental levies, except
those contested in good faith by appropriate proceedings.
Section 4.11. Limitation on Dividends and Other Payment Restrictions Affecting
Restricted Subsidiaries.
(a) The Company will not, and will not permit any of its Restricted Subsidiaries
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective, any encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(i) pay dividends or make any other distributions on its Capital Stock
or any other interest or participation in, or measured by, its
profits, owned by the Company or any Restricted Subsidiary, or pay
any Indebtedness owed to, the Company or any Restricted Subsidiary,
(ii) make loans or advances to the Company, or
33
(iii) transfer any of its properties or assets to the Company,
except for such encumbrances or restrictions existing under or by
reason of:
(A) applicable law,
(b) Indebtedness permitted;
(1) under Section 4.07(a),
(2) under Sections 4.07(b)(i), (b)(ii) and (b)(iv) and
clauses (i), (vii), and (ix) of the definition of Other
Permitted Indebtedness, or
(3) agreements and transactions permitted under Section
4.05,
(C) customary provisions restricting subletting or assignment of
any lease or license of the Company or any Restricted
Subsidiary,
(D) customary provisions of any franchise, distribution or similar
agreement,
(E) any instrument governing Indebtedness or any other encumbrance
or restriction of a Person acquired by the Company or any
Restricted Subsidiary at the time of such acquisition, which
encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the
Person, or the property or assets of the Person, so acquired,
(F) Indebtedness or other agreements existing on the date of
original Issuance of the Securities,
(G) any Refinancing Indebtedness of Indebtedness described in
Section 4.07(b)(i), (b)(ii) and (b)(iv) and clauses (i),
(vii), and (ix) of the definition of Other Permitted
Indebtedness; provided that the encumbrances and restrictions
created in connection with such Refinancing Indebtedness are
no more restrictive in any material respect with regard to the
interests of the Holders than the encumbrances and
restrictions in the refinanced Indebtedness,
(H) any restrictions, with respect to a Restricted Subsidiary,
imposed pursuant to an agreement that has been entered into
for the sale or disposition of the stock, business, assets or
properties of such Restricted Subsidiary,
(I) the terms of any Indebtedness of the Company incurred in
connection with Section 4.07, provided that the terms of such
Indebtedness constitute no greater encumbrance or restriction
on the ability of any Restricted Subsidiary to pay dividends
or make distributions, make loans or advances or transfer
properties or assets than is permitted by this Section 4.11,
and
(J) the terms of purchase money obligations, but only to the
extent such purchase money obligations restrict or prohibit
the transfer of the property so acquired.
34
(b) Nothing contained in this Section 4.11 shall prevent the Company from
entering into any agreement or instrument providing for the incurrence of
Permitted Liens or restricting the sale or other disposition of property or
assets of the Company or any of its Restricted Subsidiaries that are subject to
Permitted Liens.
Section 4.12. Maintenance of Office or Agencies.
The Company will maintain in the Borough of Manhattan, the City of New
York an office or an agency (which may be an office of any Agent) where
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 Company will give prompt written notice to the
Trustee of any change in the location of such office or agency. If at any time
the Company 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.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or recision shall in any matter relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company will give prompt
written notice to the Trustee of any such designation or recision and of any
change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03.
Section 4.13. Change of Control.
(a) Upon the occurrence of a Change of Control (such date being the "Change of
Control Trigger Date"), each Holder shall have the right to require the Company
to purchase such Holder's Securities pursuant to an Offer at a purchase price
equal to 101% of the aggregate principal amount of such Securities, plus any
accrued and unpaid interest to the Purchase Date. Although the failure of the
Company to purchase all Securities tendered in such an Offer shall be a Default,
if the Company is unable to purchase all Securities tendered in such an Offer,
the Company shall nevertheless purchase the maximum principal amount of
Securities that it is able to purchase at that time.
(b) In the event of a Change of Control, the Company shall not offer to purchase
or redeem any Subordinated Indebtedness required or entitled by its terms to be
redeemed or purchased until the Change of Control Offer for the Securities has
been consummated and all Securities tendered pursuant to such Offer have been
accepted for payment.
Section 4.14. Limitation on Asset Sales.
(a) The Company may not, and may not permit any Restricted Subsidiary to,
directly or indirectly, consummate an Asset Sale (including the sale of any of
the Capital Stock of any Restricted Subsidiary) providing for Net Proceeds in
excess of $2,500,000 unless at least (A) 50% of the consideration thereof
received by the Company or such Restricted Subsidiary is in the form of cash
and/or Cash Equivalents and/or Marketable Securities, and (B) 75% of the Net
Proceeds from such Asset Sale are applied to one or more of the following in
such combination as the Company shall elect:
35
(i) an investment in another asset or business in the same line of
business as, or a line of business similar to that of, the line of
business of the Company and its Restricted Subsidiaries at that
time; provided that such investment occurs on or prior to the 365th
day following the date of such Asset Sale (the "Asset Sale
Disposition Date"),
(ii) the purchase, redemption or other prepayment or repayment of
outstanding Senior Indebtedness on or prior to the Asset Sale
Disposition Date, or
(iii) an Offer expiring on or prior to the Purchase Date.
(b) Any Net Proceeds from the Asset Sale that are not applied or invested as
provided in Sections 4.14(a)(i) or (a)(ii) shall constitute "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds exceeds $10,000,000 (the "Asset
Sale Trigger Date"), the Company shall make an Offer to all Holders to purchase
the maximum principal amount of the Securities then outstanding that may be
purchased out of Excess Proceeds, at an offer price in cash in an amount equal
to 100% of the outstanding principal amount thereof, plus any accrued and unpaid
interest to the Purchase Date.
(d) To the extent that any Excess Proceeds remain after completion of the Offer,
the Company may use such remaining amount for general corporate purposes.
(e) Upon completion of an Offer, the amount of Excess Proceeds shall be reset at
zero.
(f) Notwithstanding the foregoing, to the extent that any or all of the Net
Proceeds of an Asset Sale is prohibited or delayed by applicable local law from
being repatriated to the United States, the portion of such Net Proceeds so
affected will not be required to be applied pursuant to this Section 4.14, but
may be retained for so long, but only for so long, as the applicable local law
prohibits repatriation to the United States. The Company will promptly take all
reasonable actions required by the applicable local law to permit such
repatriation, and once such repatriation of any affected Net Proceeds is not
prohibited under applicable local law, such repatriation will be immediately
effected and such repatriated Net Proceeds will be applied in the manner set
forth above as if such Asset Sale had occurred on the date of repatriation.
Section 4.15. Redemption of Old Notes.
The Company will, on December 15, 1993, exercise its right to make an
optional redemption of all outstanding Old Notes, if any, in accordance with the
terms of the Old Indenture.
Section 4.16. Limitation on Amendment of Discount Debenture Indenture.
Article 10 and Sections 9.07 and 11.15 of the Discount Debenture Indenture
shall not be amended, modified, supplemented or altered in any manner that would
adversely affect Holders of the Securities without the consent of Holders of at
least a majority of the outstanding principal amount of the Securities.
36
Section 4.17. Guarantees by Restricted Subsidiaries.
(a) The Company will not permit any Restricted Subsidiary, directly or
indirectly, to guarantee any Indebtedness of the Company other than the
Securities ("Other Indebtedness") unless:
(i) such Restricted Subsidiary contemporaneously executes and delivers a
supplemental indenture to this Indenture providing for a guarantee
of payment of the Securities then outstanding by such Restricted
Subsidiary to the same extent as the guarantee (the "Other
Indebtedness Guarantee") of the Other Indebtedness (including waiver
of subrogation, if any), and
(ii) if the Other Indebtedness guaranteed by such Restricted Subsidiary
is:
(A) Senior Indebtedness, the guarantee for the Securities shall be
pari passu in right of payment to the Other Indebtedness
Guarantee, and
(B) Subordinated Indebtedness, the guarantee for the Securities
shall be senior in right of payment to the Other Indebtedness
Guarantee,
provided that none of that the foregoing will limit or restrict
guarantees Issued by Restricted Subsidiaries in respect of
Indebtedness of other Restricted Subsidiaries.
(b) Each guarantee of the Securities created by a Restricted Subsidiary pursuant
to Section 4.17(a) shall be in form and substance satisfactory to the Trustee
and shall provide, among other things, that it will be automatically and
unconditionally released and discharged upon:
(i) any sale, exchange or transfer permitted by this Indenture to any
Person not an Affiliate of (A) all of the Company's Capital Stock in
such Restricted Subsidiary, or (B) the sale of all or substantially
all of the assets of the Restricted Subsidiary and upon the
application of the Net Proceeds from such sale in accordance with
Section 4.14, or
(ii) the release or discharge of the Other Indebtedness Guarantee that
resulted in the creation of such guarantee of the Securities, except
a discharge or release by or as a result of payment under such Other
Indebtedness Guarantee.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger or Consolidation.
(a) The Company shall not consolidate or merge with or into, or sell, lease,
convey or otherwise dispose of all or substantially all of its assets to, any
Person, (any such consolidation, merger or sale being a "Disposition") unless:
(i) the successor entity of such Disposition or the Person to which such
Disposition shall have been made is a corporation organized or
existing under the laws of the United States, any state thereof or
the District of Columbia;
37
(ii) the successor corporation of such Disposition or the corporation to
which such Disposition shall have been made expressly assumes the
Obligations of the Company, pursuant to a supplemental indenture in
a form reasonably satisfactory to the Trustee, under the Securities
and this Indenture;
(iii) immediately after such Disposition no Default or Event of Default
exists; and
(iv) the entity (the "Successor Corporation") formed by or surviving any
such Disposition or the corporation to which such Disposition shall
have been made;
(A) shall have Consolidated Net Worth (immediately after the
Disposition but prior to any purchase accounting adjustments
resulting from the Disposition) equal to or greater than the
Consolidated Net Worth of the Company immediately preceding
the Disposition,
(B) shall be permitted immediately after the Disposition by the
terms of Section 4.07(a) to Issue at least $1.00 of additional
Indebtedness, and
(C) shall have a pro forma Cash Flow Coverage Ratio, for the four
fiscal quarters immediately preceding the applicable
Disposition, equal to or greater than the actual Cash Flow
Coverage Ratio of the Company for such four quarter period;
provided, however, that for purposes of this Section 5.01(a)(iv),
wherever applicable, the pro forma Cash Flow Coverage Ratio shall be
calculated after giving effect to such Disposition as if the same
had occurred at the beginning of the applicable four-quarter period.
Prior to the consummation of any proposed Disposition, the Company shall
deliver to the Trustee an Officers' Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed Disposition and such supplemental
indenture comply with this Indenture.
Section 5.02. Successor Corporation Substituted.
Upon any Disposition, the Successor Corporation resulting from such
Disposition shall succeed to, and be substituted for, and may exercise every
right and power of, the Company under this Indenture with the same effect as if
such Successor has been named as the Company herein; provided, however, that
neither the Company nor any Successor Corporation shall be released from its
Obligation to pay the principal of, and premium, if any, and interest on, the
Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
(a) An "Event of Default" is:
(1) a default for 30 days in payment of interest on the
Securities;
(2) a default in payment when due of principal or premium, if any;
38
(3) the failure of the Company to comply with any of its other
agreements or covenants in, or provisions of, the outstanding
Securities or this Indenture and the Default continues for the
period, if applicable, and after the notice specified in
Section 6.01(b);
(4) a default by the Company or any Restricted Subsidiary 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
Restricted Subsidiary (or the payment of which is guaranteed
by the Company or any Restricted Subsidiary), whether such
Indebtedness exists prior to, or is created after, the date of
original Issuance of the Securities if:
(A) either (i) such default results from the failure to pay
principal of or interest on any such Indebtedness and
such default continues for 30 days beyond any applicable
grace period, or (ii) as a result of such default the
maturity of such Indebtedness has been accelerated prior
to its expressed maturity, and
(B) the principal amount of such Indebtedness, together with
the principal amount of any other such Indebtedness in
default for failure to pay principal or interest
thereon, or the maturity of which has been accelerated,
aggregates in excess of $15,000,000;
(5) a failure by the Company or any Restricted Subsidiary to pay
final judgments (not covered by insurance) aggregating in
excess of $7,500,000 which judgments a court of competent
jurisdiction does not rescind, annul or stay within 45 days
after their entry and the Default continues for the period and
after the notice specified in Section 6.01(b);
(6) in existence when the Company or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it
in an involuntary case,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors;
(7) in existence when a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case,
39
(B) appoints a Custodian of the Company or any Significant
Subsidiary, or for all or substantially all of the
property of the Company or any Significant Subsidiary,
or
(C) orders the liquidation of the Company or any Significant
Subsidiary,
and any such order or decree remains unstayed and in effect
for 60 days.
(b) A Default under Section 6.01(a)(3) (other than a Default under Sections
4.05, 4.07, 4.08, 4.11, 4.13, 4.14, 4.15, 4.16, 4.17, and 5.01 any of which
shall be an Event of Default with the notice but without the passage of time
specified in this Section 6.01(b)) or Section 6.01(a)(5) is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Securities notify the Company of the Default and the
Company does not cure the Default within 30 days after receipt of the notice.
The notice must specify the Default, demand that it be remedied and state that
the notice is a "Notice of Default."
(c) In the case of any Event of Default pursuant to Section 6.01(a) occurring by
reason of any willful action (or inaction) taken (or not taken) by or on behalf
of the Company with the intention of avoiding payment of the premium that the
Company would have to pay if the Company then had elected to redeem the
Securities pursuant to paragraph 5 of the Securities, an equivalent premium
shall also become and be immediately due and payable to the extent permitted by
law, anything in this Indenture or in the Securities contained to the contrary
notwithstanding.
Section 6.02. Acceleration.
(a) Upon the occurrence of an Event of Default (other than an Event of Default
under Section 6.01(a)(6) or (a)(7)) occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Securities
may declare all outstanding Securities to be due and payable immediately and
upon such declaration, the principal amount and premium, if any, of all such
Securities, and any accrued interest on, all such Securities to the date of
payment shall be due and payable immediately; provided, however, that if an
Event of Default arises under Section 6.01(a)(6) or (a)(7), the principal amount
of, and premium, if any, and any accrued and unpaid interest on, all such
Securities, shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holders.
(b) The Holders of a majority in principal amount of the then outstanding
Securities by notice to the Trustee may rescind any declaration of acceleration
of such Securities and its consequences if the rescission would not conflict
with any judgment or decree and if all existing Defaults and Events of Default
(other than the nonpayment of principal of, or premium, if any, or interest on,
the Securities which shall have become due by such declaration) shall have been
cured or waived.
(c) If there has been a declaration of acceleration of the Securities because an
Event of Default under Section 6.0l(a)(4) has occurred and is continuing, such
declaration of acceleration shall be automatically annulled if the holders of
the Indebtedness described in Section 6.01(a)(4) have rescinded the declaration
of acceleration in respect of such Indebtedness within 30 Business Days thereof
and if:
(i) the annulment of such acceleration would not conflict with any
judgment or decree of a court of competent jurisdiction,
40
(ii) all existing Events of Default, except non-payment of principal or
interest that shall have become due solely because of the
acceleration, have been cured or waived, and
(iii) the Company has delivered an Officer's Certificate to the Trustee to
the effect of clauses (i) and (ii) above.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal of, or premium, if any,
or interest on, the Securities or to enforce the performance of any provision of
the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
The Holders of a majority in principal amount of the then outstanding
Securities by notice to the Trustee may waive any existing Default or Event of
Default and its consequences, except a continuing Default or Event of Default in
the payment of the principal of, or premium, if any, or interest on, any
Security (which may only be waived with the consent of each Holder affected).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall deemed to have been cured for every purpose of
this Indenture; provided that no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
Section 6.05. Control by Majority.
Subject to Section 7.01(e), the Holders of a majority in principal amount
of the then outstanding Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it by this Indenture. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture, that
the Trustee determines may be unduly prejudicial to the rights of other Holders,
or would involve the Trustee in personal liability.
Section 6.06. Limitation on Suits.
A Holder may pursue a remedy with respect to this Indenture or the
Securities only if:
(i) the Holder gives to the Trustee notice of a continuing Event of
Default;
(ii) the Holders of at least 25% in principal amount of the then
outstanding Securities make a request to the Trustee to pursue the
remedy;
(iii) such Holder or Holders offer to the Trustee indemnity satisfactory
to the Trustee against any loss, liability or expense;
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(iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(v) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Securities do not give the Trustee a
direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
Holders of the Securities may not enforce this Indenture, except as
provided herein.
Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of, and premium, if any, and interest on,
a Security on or after a respective due date expressed in the Security, or to
bring suit for the enforcement of any such payment on or after such respective
date, shall not be impaired or affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a)(1) or (a)(2) occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for (i) the principal,
premium, if any, and interest remaining unpaid on the Securities, (ii) interest
on overdue principal and premium, if any, and, to the extent lawful, interest,
and (iii) such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel ("Trustee
Expenses").
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable to have the claims of the Trustee (including any
claim for Trustee Expenses) and the Holders allowed in any Insolvency or
Liquidation Proceeding or other judicial proceeding relative to the Company (or
any other obligor upon the Securities), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute to Holders any
money or other property payable or deliverable on any such claims and each
Holder authorizes any Custodian in any such Insolvency or Liquidation Proceeding
or other judicial proceeding to make such payments to the Trustee, and if the
Trustee shall consent to the making of such payments directly to the Holders any
such Custodian is hereby authorized to make such payments directly to the
Holders, and to pay to the Trustee any amount due to it hereunder for Trustee
Expenses, and any other amounts due the Trustee under Section 7.07. To the
extent that the payment of any such Trustee Expenses, and any other amounts due
the Trustee under Section 7.07 out of the estate in any such proceeding, shall
be denied for any reason, payment of the same shall be secured by a Lien on, and
shall be paid out of, any and all distributions, dividends, money, securities
and other properties which the Holders may be entitled to receive in such
proceeding, whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any Insolvency or
Liquidation Proceeding.
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Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the
Securities for principal, premium, if any, and
interest, ratably, without preference or priority
of any kind, according to the amounts due and
payable on the Securities for principal, premium,
if any, and interest, respectively; and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07, or a suit by Holders of more than 10% in principal
amount of the then outstanding Securities.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default occurs (and has not been cured) the Trustee shall (i)
exercise the rights and powers vested in it by this Indenture, and (ii) use the
same degree of care and skill in exercising such rights and powers as a prudent
man would exercise or use under the circumstances in the conduct of his own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee's duties shall be determined solely by the express
provisions of this Indenture and the Trustee need perform only those
duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine
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whether they conform to this Indenture's requirements and to confirm
the correctness of all mathematical computations.
(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:
(i) this paragraph does not limit the effect of Section 7.01(b);
(ii) 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
(iii) 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 it
receives pursuant to Section 6.05.
(d) Whether or not expressly so provided, every provision of this Indenture that
in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of
this Section.
(e) No provision of this Indenture shall require the Trustee to expend or risk
its own funds or incur any liability. The Trustee shall be under no obligation
to exercise any of its rights and powers under this Indenture at the request of
any Holders unless such Holders shall have offered to the Trustee security and
indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money it receives except
as the Trustee may agree in writing with the Company. Money the Trustee holds in
trust need not be segregated from other funds except to the extent required by
law.
Section 7.02. Rights of Trustee.
(a) The Trustee may rely on any document it believes 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, or both. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through agents and shall not be responsible for the
misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take in
good faith that it believes to be authorized or within its rights or powers.
(e) Unless otherwise specifically provided in the Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer.
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Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company or an Affiliate
with the same rights it would have if it were not Trustee. However, if the
Trustee acquires any conflicting interest it must eliminate such conflict within
90 days, apply to the Commission for permission to continue as trustee or
resign. Any Agent may do the same with like rights. The Trustee is also subject
to Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities or for any
money paid to the Company or upon the Company's direction under any provisions
hereof, it shall not be responsible for the use or application of any money any
Paying Agent other than the Trustee receives, and it shall not be responsible
for any statement or recital herein or any statement in the Securities or any
other document in connection with the sale of the Securities or pursuant to this
Indenture, other than its certificate of authentication.
Section 7.05. Notice to Holders of Defaults and Events of Default.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders a notice of the Default
or Event of Default within 90 days after it occurs. Except in the case of a
Default or Event of Default in payment on any Security (including any failure to
redeem Securities called for redemption or any failure to purchase Securities
tendered pursuant to an Offer that are required to be purchased by the terms of
this Indenture), the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the Holders' interests.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after each August 1 beginning with August 1, 1994, the
Trustee shall mail to Holders a brief report dated as of such reporting date
that complies with section 313(a) of the TIA (but if no event described in
section 313(a) of the TIA has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with section 313(b)(2) of the TIA. The Trustee shall also transmit by mail all
reports as required by section 313(c) of the TIA.
Commencing at the time this Indenture is qualified under the TIA, a copy
of each report at the time of its mailing to Holders shall be filed with the SEC
and each stock exchange on which the Securities are listed. The Company shall
notify the Trustee when the Securities are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its 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 disbursements,
advances and expenses it incurs or makes in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
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The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses the Trustee incurs arising out of or in connection with
the acceptance or administration of its duties under this Indenture, except as
set forth below. 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 shall cooperate in the defense. The Trustee may
have separate counsel and the Company shall pay the reasonable fees and expenses
of such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.
The Company's Obligations under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture.
The Company need not reimburse any expense or indemnify against any loss
or liability the Trustee incurs through negligence or bad faith.
To secure the Company's payment of its Obligations in this Section, the
Trustee shall have a Lien prior to the Securities on all money or property the
Trustee holds or collects, except that held in trust to pay principal of, and
premium, if any, and interest on, particular Securities. Such Lien shall survive
the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(6) or (7) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute administrative expenses under any Bankruptcy
Law.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign and be discharged from the trust hereby created by
so notifying the Company. The Holders of a majority in principal amount of the
then outstanding Securities may remove the Trustee by so notifying the Trustee
and the Company. The Company may remove the Trustee if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged a bankruptcy or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy
Law;
(iii) a Custodian or public officer takes charge of the Trustee or its
property; or
(iv) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee, provided that the Holders of a majority in principal amount of the then
outstanding Securities may appoint a successor Trustee to replace any successor
Trustee appointed by Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the
46
then outstanding Securities may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to 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 appointment to
Holders. The retiring Trustee shall promptly transfer all property it holds as
Trustee to the successor Trustee, provided all sums owing to the retiring
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 shall continue for the retiring
Trustee's benefit with respect to expenses and liabilities it incurred prior to
being replaced.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
The Trustee shall at all times (i) be a corporation organized and doing
business under the laws of the United States of America, of any state thereof,
or the District of Columbia authorized under such laws to exercise corporate
trustee power, (ii) be subject to supervision or examination by federal or state
authority, (iii) have a combined capital and surplus of at least $25 million
($100 million in the case of any successor Trustee) as set forth in its most
recent published annual report of condition, and (iv) satisfy the requirements
of sections 310(a)(1), (2) and (5) of the TIA. The Trustee is subject to section
310(b) of the TIA.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to section 311(a) of the TIA, excluding any
creditor relationship listed in section 311(b) of the TIA. A Trustee who has
resigned or been removed shall be subject to section 311(a) of the TIA to the
extent indicated therein.
ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.01. Discharge of Liability on Securities; Defeasance.
(a) When (i) the Company delivers to the Trustee all outstanding Securities
(other than Securities replaced pursuant to Section 2.07) for cancellation, or
(ii) all outstanding Securities have become due and payable and the Company
irrevocably deposits with the Trustee funds sufficient to pay at maturity all
outstanding Securities, including interest thereon (other than Securities
replaced pursuant to Section 2.07), and if in either case the Company pays all
other sums payable under this Indenture by the Company, then this Indenture
shall, subject to Sections 8.01(c) and 8.06, cease to be of further effect.
47
(b) Subject to Sections 8.01(c), 8.02, and 8.06, 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 4.02, 4.03,
4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.13, 4.14, 4.15, 4.16 and 4.17, and
the operation of Sections 5.01(iii), 5.01(iv), or 6.01(a)(3) through (a)(7)
("covenant defeasance option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in 6.01(a)(3) through
(a)(7) or because of the Company's failure to comply with Sections 5.01(iii) or
5.01(iv).
Upon satisfaction of the conditions set forth herein and upon the
Company's request (and at the Company's expense), the Trustee shall acknowledge
in writing the discharge of those obligations that the Company has terminated.
(c) Notwithstanding clauses (a) and (b) above, the Company's obligations in
Sections 2.03, 2.04, 2.05, 2.06, 2.07, 4.01, 4.04, 7.07, 7.08, 8.04, 8.05, and
8.06, and the Trustee's and the Paying Agent's obligations in Section 8.04 shall
survive until the Securities have been paid in full. Thereafter, the Company's
obligations in Sections 7.07 and 8.05 and the Company's, Trustee's and Paying
Agent's obligations in Section 8.04 shall survive.
Section 8.02. Conditions to Defeasance.
The Company may exercise its legal defeasance option or its covenant
defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations sufficient for the
payment in full of the principal of, and any premium due on,
the Securities, and any accrued and unpaid interest, as of the
maturity date, the redemption date or the Purchase Date, 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 of 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 of, and premium, if
any, and interest when due on all the Securities to maturity
or redemption, as the case may be;
(3) since the Company's irrevocable deposit provided for in
Section 8.02(1) 91 days have passed;
(4) no Default has occurred and is continuing on the date of such
deposit and after giving effect to it;
(5) the deposit does not constitute a default under any other
agreement binding on the Company;
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(6) 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, as amended;
(7) 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)
under applicable federal income tax law, in either case, to
the effect that, and based thereon such Opinion of Counsel
shall confirm that, the Holders will not recognize income,
gain or loss for federal income tax purposes as a result of
such defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred;
(8) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders will not recognize income, gain or
loss for federal income tax purposes as a result of such
covenant defeasance and will be subject to federal income tax
on the same amounts, in the same manner and at the same times
as would have been the case if such covenant defeasance had
not occurred; and
(9) 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
contemplates by this Article 8 have been satisfied.
Before or after a deposit, the Company may make arrangements satisfactory
to the Trustee for the redemption or purchase of Securities at a future date in
accordance with Article 3.
Section 8.03. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to this Article 8. It 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 premium, if
any, and interest on, the Securities.
Section 8.04. Repayment to Company.
After the Securities have been paid in full, the Trustee and the Paying
Agent shall promptly turn over to the Company any excess money or securities
they hold.
The Trustee and the Paying Agent shall pay to the Company upon written
request any money they hold for the payment of principal, premium or interest
that remains unclaimed for 1 year after the date upon which such payment shall
have become due; provided however, that the Company shall have either caused
notice of such payment to be mailed to each Holder entitled thereto no less than
30 days prior to such repayment or within such period shall have published such
notice in a financial newspaper of widespread circulation published in The City
of New York,(including, without limitation, The Wall Street Journal). After
payment to the Company, Holders entitled to the money must look to the Company
for payment as general creditors unless an applicable abandoned property law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
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Section 8.05. Indemnity for Government Obligations.
The Company shall pay and shall indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against deposited U.S. Government
Obligations or the principal and interest received on such U.S. Government
Obligations.
Section 8.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 8 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article 8
until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with this Article 8;
provided, however, that, if the Company has made any payment of principal of, or
premium, if any, or interest on, any Securities because of the reinstatement of
its Obligations, the Company shall be subrogated to the Holders' rights to
receive such payment from the money or U.S. Government Obligations the Trustee
or Paying Agent holds.
ARTICLE 9
AMENDMENTS
Section 9.01. Amendments and Supplements Permitted Without Consent of Holders.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Securities without the
consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Securities in addition to or in place
of certificated Securities;
(c) to provide for the assumption by a Successor Corporation of the
Company's Obligations to the Holders in the event of a Disposition
pursuant to Article 5;
(d) to comply with SEC's requirements to effect or maintain the
qualification of this Indenture under the TIA; or
(e) to make any change that does not materially adversely affect any
Holder's legal rights under this indenture.
Upon the Company's request, after receipt by the Trustee of a resolution
of the Board of Directors authorizing the execution of any amended or
supplemental indenture, the documents described in Section 9.06, the Trustee
shall join with the Company in the execution of any amended or supplemental
indenture authorized or permitted by the terms of this Indenture and to make any
further appropriate agreements and stipulations that may be contained in any
such amended or supplemental indenture, but the Trustee shall not be obligated
to enter into an amended or supplemental indenture that affects its own rights,
duties or immunities under this Indenture or otherwise.
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Section 9.02. Amendments and Supplements Requiring Consent of Holders.
Subject to Section 6.07, the Company and the Trustee may amend or
supplement this Indenture or the Securities with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Securities (including consents obtained in connection with a tender offer or
exchange offer for the Securities). Subject to Sections 6.04 and 6.07, the
Holders of a majority in principal amount of the Securities then outstanding
(including consents obtained in connection with a tender offer or exchange offer
for the Securities) may also waive any existing Default or Event of Default
(other than a payment Default) and its consequences or compliance in a
particular instance by the Company with any provision of this Indenture or the
Securities.
Upon the Company's request and after receipt by the Trustee of a
resolution of the Board of Directors authorizing the execution of any
supplemental indenture, evidence of the Holders' consent, and the documents
described in Section 9.06, the Trustee shall join with the Company in the
execution of such amended or supplemental indenture unless such amended or
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in its
discretion, but not be obligated to, enter into such amended or supplemental
indenture.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment or waiver, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment or waiver under this Section becomes effective, the
Company shall mail to each Holder affected thereby a notice briefly describing
the amendment, supplement or waiver. Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amended or supplemental indenture or waiver. Without
the consent of each Holder affected, an amendment, supplement or waiver under
this Section may not:
(1) reduce the principal amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for payment of interest,
including default interest as set forth in Section 4.01, on
any Security or alter the redemption or purchase provisions
with respect thereto;
(3) reduce the principal of or change the fixed maturity of any
Security;
(4) make any Security payable in money other than that stated in
the Security;
(5) make any change in Section 6.04 or 6.07 or in this sentence of
this Section 9.02; or
(6) waive a default in the payment of the principal of, or
premium, if any, or interest on, or redemption or purchase
payment with respect to, any Security (except a rescission of
acceleration of the Securities by the Holders of at least a
majority in aggregate principal amount of the then outstanding
Securities and a waiver of the payment default that resulted
from such acceleration).
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Section 9.03. Compliance with TIA.
Every amendment or supplement to this Indenture or the Securities shall be
set forth in an amended supplemental indenture that complies with the TIA as
then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to
it by a Holder of a Security is a continuing consent by the Holder and every
subsequent holder of a Security or portion of a Security that evidences the same
Indebtedness as the consenting Holder's Security, even if notation of the
consent is not made on any Security. However, any such Holder or subsequent
Holder may revoke the consent as to his or her Security or portion of a Security
if the Trustee receives the notice of revocation before the date on which the
Trustee receives an Officer's Certificate certifying that the Holders of the
requisite principal amount of Securities have consented to the amendment or
waiver.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the holders of Securities entitled to consent to any
amendment or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
holders of Securities at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to consent to such amendment or waiver
or to revoke any consent previously given, whether or not such Persons continue
to be holders of Securities after such record date. No consent shall be valid or
effective for more than 90 days after such record date unless consents from
Holders of the principal amount of Securities required hereunder for such
amendment or waiver to be effective shall have also been given and not revoked
within such 90-day period.
After an amendment or waiver becomes effective it shall bind every Holder,
unless it is of the type described in any of clauses (1) through (6) of Section
9.02. In such case, the amendment or waiver shall bind each Holder who has
consented to it and every subsequent holder of a Security that evidences the
same debt as the consenting Holder's Security.
Section 9.05. Notation on or Exchange of Securities.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Security thereafter authenticated. The Company in
exchange for all Securities may Issue and the Trustee shall authenticate new
Securities that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or Issue a new Security shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee Protected.
The Trustee shall sign any amendment or supplemental indenture authorized
pursuant to this Article 9 if the amendment does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing such amendment or supplemental
indenture, the Trustee shall be entitled to receive and, subject to Section
7.01, shall be fully protected in relying upon, an Officers' Certificate and
Opinion of Counsel as conclusive evidence that such amendment or supplemental
indenture is authorized or permitted by this Indenture, that it is not
inconsistent herewith, and that it will be valid and binding upon the Company in
accordance with its terms. The Company may not sign an amendment or supplemental
indenture until the Board of Directors approves it.
52
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
the duties imposed by operation of Section 318(c) of the TIA, the imposed duties
shall control.
Section 10.02. Notices.
Any notice or communication by the Company or the Trustee to the other is
duly given if in writing and delivered in person, mailed by registered or
certified mail, postage prepaid, return receipt requested or delivered by
telecopier or overnight air courier guaranteeing next day delivery to the
other's address:
If to the Company:
Jordan Industries, Inc.
ArborLake Centre
0000 Xxxx Xxxx Xxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
If to the Trustee:
First Trust National Association
X.X. Xxx 00000
Xx. Xxxx, Xxxxxxxxx 00000-0000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
The Company or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; the date receipt is acknowledged, if mailed by registered or
certified mail; when answered back, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first-class
mail to his or her address shown on the register kept by the Registrar. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
53
Section 10.03. Communication by Holders with Other Holders.
Holders may communicate pursuant to section 312(b) of the TIA with other
Holders with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and any other Person shall have the
protection of section 312(c) of the TIA.
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate (which shall include the statements
set forth in Section 10.05) stating that, in the opinion of
the signers, all conditions precedent and covenants, if any,
provided for in this Indenture relating to the proposed action
have been complied with; and
(b) an Opinion of Counsel (which shall include the statements set
forth in Section 10.05) stating that, in the opinion of such
counsel, all such conditions precedent provided for in this
Indenture relating to the proposed action have been complied
with.
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to section 314(a)(4) of the TIA) shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he 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, in such Person's opinion, such
condition or covenant has been complied with.
Section 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. Legal Holidays.
If a payment date is a Legal Holiday at a place of payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
54
Section 10.08. No Recourse Against Others.
No director, officer, employee or stockholder of the Company shall have
any liability for any Obligations of the Company under the Securities or this
Indenture or for any Claim based on, in respect of or by reason of such
Obligations or the creation if any such Obligation. Each Holder by accepting a
Security waives and releases all such liability, and such waiver and release is
part of the consideration for the Issuance of the Securities.
Section 10.09. Counterparts.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
Section 10.10. Variable Provisions.
The Company initially appoints the Trustee as Paying Agent, Registrar and
authenticating agent.
The first compliance certificate to be delivered by the Company to the
Trustee pursuant to Section 4.03 shall be for the fiscal year ending on December
31, 1993.
Section 10.11. Governing Law.
The internal laws of the State of New York shall govern this Indenture and
the Securities, without regard to the conflict of laws provisions thereof.
Section 10.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any of its Subsidiaries, and no other
indenture, loan or debt agreement may be used to interpret this Indenture.
Section 10.13. Successors.
All agreements of the Company in this Indenture and the Securities shall
bind its successor. All agreements of the Trustee in this Indenture shall bind
its successor.
Section 10.14. Severability.
If any provision in this Indenture or in the Securities shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 10.15. Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table, and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
55
Dated as of July 15, 1993 JORDAN INDUSTRIES, INC.
By: [ILLEGIBLE]
------------------------------------
Name:
Title:
Attest:
[ILLEGIBLE]
-----------------------------
[SEAL]
Dated as of July 15, 1993 FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By: [ILLEGIBLE]
------------------------------------
Name: [ILLEGIBLE]
Title: [ILLEGIBLE]
Attest:
[ILLEGIBLE]
-----------------------------
[SEAL]
EXHIBIT A
(Face of Security)
10 3/8% SENIOR NOTE DUE 2003
No._____ $________
JORDAN INDUSTRIES, INC.
promises to pay to _____________________________________________________________
or registered assigns,
the principal sum of _________________________________ Dollars on August 1, 2003
Interest Payment Dates: February 1 and August 1
Record Dates: January 15 and July 15
Dated:
Authenticated:
FIRST TRUST NATIONAL ASSOCIATION, as Trustee JORDAN INDUSTRIES, INC.
By: By:
----------------------- --------------------
Authorized Signature
OR By:
--------------------------
as Authenticating Agent
By:
--------------------
Authorized Signature (SEAL)
A - 1
(Back of Security)
10 3/8% SENIOR NOTE DUE 2003
1. Interest. Jordan Industries, Inc. (the "Company") promises to pay
interest on the principal amount of the Securities at the rate and in the manner
specified below. Interest on the Securities will accrue at 10 3/8% per annum
from the date this Security is issued until maturity and will be payable
semiannually in cash on February 1 and August 1 of each year, or if any such day
is not a Business Day on the next succeeding Business Day (each an "Interest
Payment Date"). Interest on the Securities will accrue from the most recent date
on which interest has been paid or, if no interest has been paid, from July 23,
1993; provided that the first Interest Payment Date shall be February 1, 1994.
The Company shall pay interest on overdue principal and premium, if any, from
time to time on demand at the rate of 2% per annum in excess of the interest
rate then in effect and shall pay interest on overdue installments of interest
(without regard to any applicable grace periods) from time to time on demand at
the same rate to the extent lawful. Interest will be computed on the basis of a
36O-day year of twelve 3O-day months.
2. Method of Payment. The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are registered holders of
Securities at the close of business on the record date for the next Interest
Payment Date even if such Securities are cancelled after such record date and on
or before such Interest Payment Date. Holders must surrender Securities to a
Paying Agent to collect principal payments on such Securities. The Company will
pay principal, premium, if any, and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts.
However, the Company may pay principal, premium, if any, and interest by check
payable in such money, and any such check may be mailed to a Holder's registered
address.
3. Paying Agent and Registrar. First Trust National Association (the
"Trustee") will initially act as the Paying Agent and Registrar. The Company may
appoint additional paying agents or co-registrars, and change the Paying Agent,
any additional paying agent, the Registrar or any co-registrar without prior
notice to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. Indenture. The Company issued the Securities under an Indenture, dated
as of July 15, 1993 (the "Indenture"), between the Company and the Trustee. The
terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.
Code xx.xx. 77aaa-77bbbb) as in effect on the date of the original issuance of
the Securities (the "Trust Indenture Act"). The Securities are subject to, and
qualified by, all such terms, certain of which are summarized herein, and
Holders are referred to the Indenture and the Trust Indenture Act for a
statement of such terms (all capitalized terms not defined herein shall have the
meanings assigned them in the Indenture). The Securities are unsecured general
obligations of the Company limited to $275,000,000 in aggregate principal
amount.
5. Optional Redemption. (a) Except as described in paragraph 5(b) below,
the Securities may not be redeemed at the option of the Company prior to August
1, 1998. During the twelve (12) month period beginning August 1 of the years
indicated below, the Securities will be redeemable at the option of the Company,
in whole or in part, at the redemption prices (expressed as percentages of the
principal amount) set forth below, plus any accrued and unpaid interest to the
date of redemption:
A - 2
Year Percentage
1998 ..................................... 105.18750%
1999 ..................................... 102.59375%
2000 and thereafter ...................... 100.00000%
6. Mandatory Redemption. Subject to the Company's obligation to make an
offer to purchase Securities under certain circumstances pursuant to Section
4.13 and 4.14 of the Indenture (as described in paragraph 7 below), the Company
is not required to make any mandatory redemption, purchase or sinking fund
payments with respect to the Securities.
7. Mandatory Offers to Purchase Securities. (a) Following the occurrence
of a Change of Control (the "Change of Control Trigger Date"), the Company will
be required to offer (a "Change of Control Offer") to purchase all outstanding
Securities at a purchase price equal to 101% of the principal amount of such
Securities, plus any accrued and unpaid interest to the date of purchase.
(b) If the Company or any Restricted Subsidiary consummates one or more
Asset Sales and does not use all of the Net Proceeds from such Asset Sales as
provided in the Indenture, the Company will be required, under certain
circumstances, to utilize the Excess Proceeds from such Asset Sales to offer (an
"Asset Sale Offer") to purchase Securities at a purchase price equal to 100% of
the principal amount of the Securities, plus any accrued and unpaid interest to
the date of purchase. If the Excess Proceeds are insufficient to purchase all
Securities tendered pursuant to any Asset Sale Offer, the Trustee shall select
the Securities to be purchased in accordance with the terms of the Indenture.
(c) Holders may tender all or, subject to paragraph 8 below, any portion
of their Securities in a Change of Control Offer or Asset Sale Offer
(collectively, an "Offer") by completing the form below entitled "OPTION OF
HOLDER TO ELECT PURCHASE."
(d) The Company will comply with Rule 14e-1 under the Securities Exchange
Act of 1934, as amended, and any other securities laws and regulations to the
extent applicable to any Offer.
8. Notice of Redemption or Purchase. Notice of an optional redemption or
an Offer will be mailed to each Holder at its registered address at least 30
days but not more than 60 days before the date of redemption or purchase.
Securities may be redeemed or purchased in part, but only in whole multiples of
$1000 unless all Securities held by a Holder are to be redeemed or purchased. On
or after any date on which Securities are redeemed or purchased, interest ceases
to accrue on the Securities or portions thereof called for redemption or
accepted for purchase on such date.
9. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples thereof.
The transfer of Securities may be registered and Securities may be exchanged as
provided in the Indenture. Holders seeking to transfer or exchange their
Securities may be required, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Security or portion of a Security selected for redemption or
tendered pursuant to an Offer. Also, it need not exchange or register the
transfer of any Securities for a period of 15 Business Days before a selection
of Securities to be redeemed or between a record date and the next succeeding
Interest Payment Date.
10. Persons Deemed Owners. The registered holder of a Security may be
treated as its owner for all purposes.
A - 3
11. Amendments and Waivers. Subject to certain exceptions, the Indenture
or the Securities may be amended with the consent of the Holders of at least a
majority in principal amount of the then outstanding Securities, and any
existing Default (except a payment Default) may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding
Securities. Without the consent of any Holder, the Indenture or the Securities
may be amended to: cure any ambiguity, defect or inconsistency; provide for
uncertificated Securities in addition to or in place of certificated Securities;
provide for the assumption by another corporation of the Company's obligations
to Holders in the event of a merger or consolidation of the Company in which the
Company is not the surviving corporation or a sale of substantially all of the
Company's assets to such other corporation; comply with the Securities and
Exchange Commission's requirements to effect or maintain the qualification of
the Indenture under the Trust Indenture Act; or, make any change that does not
materially adversely affect any Holder's rights under the Indenture. Certain
provisions of the Indenture cannot be amended without the consent of holders of
Senior Indebtedness.
12. Defaults and Remedies. Events of Default include: default for 30 days
in payment of interest on the Securities; default in payment of principal of or
premium, if any, on the Securities; failure by the Company for 30 days after
notice to it to comply with any of its other agreements or covenants in, or
provisions of, the Indenture or the Securities; certain defaults under and
acceleration prior to maturity, or failure to pay at maturity, of certain other
Indebtedness; certain final judgments that remain undischarged; and, certain
events of bankruptcy or insolvency involving the Company or any Restricted
Subsidiary that is a Significant Subsidiary. If an Event of Default occurs and
is continuing, the Trustee or the Holders of at least 25% in principal amount of
the Securities may declare all the Securities to be immediately due and payable
in an amount equal to the principal amount of such Securities, plus any accrued
and unpaid interest; provided, however, that in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, the principal amount
of, and any accrued and unpaid interest on, the Securities becomes due and
payable immediately without further action or notice. Subject to certain
exceptions, Holders of a majority in principal amount of the then outstanding
Securities may direct the Trustee in its exercise of any trust or power,
provided that the Trustee will be under no obligation to exercise any of its
rights or powers under the Indenture at the request of Holders unless such
Holders have offered to the Trustee security and indemnity satisfactory to it.
Holders may not enforce the Indenture or the Securities except as provided in
the Indenture. The Trustee may withhold from Holders notice of any continuing
default (except a payment Default) if it determines that withholding notice is
in their interests. The Company must furnish an annual compliance certificate to
the Trustee.
13. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or any Affiliate, and may otherwise deal with the Company or any
Affiliate, as if it were not Trustee.
14. No Recourse Against Others. No director, officer, employee or
stockholder of the Company shall 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 the creation of any such
Obligation. Each Holder by accepting a Security waives and releases all such
liability, and such waiver and release is part of the consideration for the
issuance of the Securities.
15. Successor Substituted. Upon the consolidation or merger by the Company
with or into another corporation, or upon the sale, conveyance, lease or other
disposition of all or substantially all of its assets to another corporation, in
accordance with the Indenture, the corporation surviving any such merger or
consolidation (if not the Company) or the corporation to which such assets were
sold or transferred to shall succeed to, and be substituted for, and may
exercise every right and power of the
A - 4
Company under the Indenture with the same effect as if such surviving or other
corporation had been named as the Company in the Indenture.
16. Governing Law. This Security shall be governed by and construed in
accordance with the internal laws of the State of New York.
17. Authentication. This Security shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
18. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
19. 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 have directed the Trustee to
use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers printed on the securities.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture, which has in it the text of this Security in
larger type. Request may be made to:
Jordan Industries, Inc.
0000 Xxxx Xxxx Xxxx
XxxxxXxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Secretary
A - 5
ASSIGNMENT FORM
To assign this Security, fill in the form below:
(I) or (we) assign and transfer this Security to:
_______________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_________________________________________________
_________________________________________________
_________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
_____________________________ as agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.
Date: ____________________ Your Signature:
--------------------------------
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guarantee:
------------------------------
A - 6
OPTION OF HOLDER TO ELECT PURCHASE
If you elect to have this Security purchased by the Company pursuant to
Section 4.13 of the Indenture, check the box: |___|
If you elect to have this Security purchased by the company pursuant to
Section 4.14 of the Indenture, check the box: |___|
If you elect to have only part of this Security purchased by the Company
pursuant to Section 4.13 or 4.14 of the Indenture, state the amount (multiples
of $1000 only):
$________________
Date: ____________________ Your Signature:
--------------------------------
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guarantee:
---------------------------------
A - 7
