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INTERNATIONAL SHIPHOLDING CORPORATION,
as Issuer
and
THE BANK OF NEW YORK,
as Trustee
INDENTURE
Dated as of January 22, 1998
up to $160,000,000
7 3/4% Senior Notes due 2007
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
--------- ---------
310(a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 7.10
(b) 7.08; 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) 7.06
(c) 7.06; 10.02
(d) 7.06; 10.02
314(a) 4.02; 4.04; 10.02
(b) N.A.
(c)(1) 10.04; 10.05
(c)(2) 10.04; 10.05
(c)(3) N.A.
(d) N.A.
(e) 10.05
(f) N.A.
315(a) 7.01; 7.02
(b) 7.05; 10.02
(c) 7.01
(d) 6.05; 7.01; 7.02
(e) 6.11
316(a) (last sentence) 10.06
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) 8.02
(b) 6.07
(c) 8.04
317(a)(1) 6.08
(a)(2) 6.09
(b) 7.12
318 10.01
N.A. means Not Applicable
NOTE: This Cross-Reference Table shall not, for any purpose,
be deemed to be a part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions. 1
Section 1.02. Other Definitions. 18
Section 1.03. Incorporation by Reference of Trust Indenture Act. 19
Section 1.04. Rules of Construction. 19
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture. 20
Section 2.02. Execution and Authentication. 21
Section 2.03. Registrar and Paying Agent. 22
Section 2.04. Paying Agent To Hold Money in Trust. 22
Section 2.05. Noteholder Lists. 23
Section 2.06. Transfer and Exchange. 23
Section 2.07. Replacement Notes. 24
Section 2.08. Outstanding Notes. 25
Section 2.09. Temporary Notes. 25
Section 2.10. Cancellation. 26
Section 2.11. Defaulted Interest. 26
Section 2.12. Deposit of Moneys. 26
Section 2.13. CUSIP Number. 27
Section 2.14. Book-Entry Provisions for Global Notes. 27
Section 2.15. Special Transfer Provisions. 29
ARTICLE 3
REDEMPTION
Section 3.01. No Redemption. 31
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes. 31
Section 4.02. Provision of Financial Statements and Other Information. 32
Section 4.03. Waiver of Stay, Extension or Usury Laws. 33
Section 4.04. Compliance Certificate. 33
Section 4.05. Taxes. 34
Section 4.06. Limitation on Indebtedness. 34
Section 4.07. Limitation on Restricted Payments. 35
Section 4.08. Disposition of Proceeds of Asset Sales. 38
Section 4.09. Limitation on Transactions with Affiliates. 42
Section 4.10. Limitations on Liens. 42
Section 4.11. Limitations on Guarantees by Subsidiaries. 42
Section 4.12. Limitation on Sale-Leaseback Transactions. 43
Section 4.13. Payments for Consent. 44
Section 4.14. Corporate Existence. 44
Section 4.15. Change of Control. 44
Section 4.16. Maintenance of Office or Agency. 47
Section 4.17. Restrictions on Preferred Stock of Subsidiaries. 47
Section 4.18. Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries. 47
Section 4.19. Limitations on Unrestricted Subsidiaries. 48
Section 4.20. Insurance. 48
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation, Merger and Sale of Assets. 49
Section 5.02. Successor Person Substituted. 52
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default. 52
Section 6.02. Acceleration. 55
Section 6.03. Other Remedies. 56
Section 6.04. Waiver of Past Defaults and Events of Default. 56
Section 6.05. Control by Majority. 56
Section 6.06. Limitation on Suits. 57
Section 6.07. Rights of Holders To Receive Payment. 57
Section 6.08. Collection Suit by Trustee. 58
Section 6.09. Trustee May File Proofs of Claim. 58
Section 6.10. Priorities. 59
Section 6.11. Undertaking for Costs. 59
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee. 60
Section 7.02. Rights of Trustee. 61
Section 7.03. Individual Rights of Trustee. 62
Section 7.04. Trustee's Disclaimer. 62
Section 7.05. Notice of Defaults. 62
Section 7.06. Reports by Trustee to Holders. 63
Section 7.07. Compensation and Indemnity. 63
Section 7.08. Replacement of Trustee. 64
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion. 65
Section 7.10. Eligibility; Disqualification. 66
Section 7.11. Preferential Collection of Claims Against Company. 66
Section 7.12. Paying Agents. 66
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders. 67
Section 8.02. With Consent of Holders. 68
Section 8.03. Compliance with Trust Indenture Act. 69
Section 8.04. Revocation and Effect of Consents. 70
Section 8.05. Notation on or Exchange of Notes. 70
Section 8.06. Trustee To Sign Amendments, etc. 71
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture. 71
Section 9.02. Defeasance. 72
Section 9.03. Covenant Defeasance. 72
Section 9.04. Conditions to Defeasance or Covenant Defeasance. 73
Section 9.05. Deposited Money and U.S. Government Obligations To Be Held
in Trust; Other Miscellaneous Provisions. 74
Section 9.06. Reinstatement. 75
Section 9.07. Moneys Held by Paying Agent. 75
Section 9.08. Moneys Held by Trustee. 76
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls. 76
Section 10.02. Notices. 76
Section 10.03. Communications by Holders with Other Holders. 78
Section 10.04. Certificate and Opinion as to Conditions Precedent. 78
Section 10.05. Statements Required in Certificate and Opinion. 78
Section 10.06. When Treasury Notes Disregarded. 79
Section 10.07. Rules by Trustee and Agents. 79
Section 10.08. Business Days; Legal Holidays. 79
Section 10.09. Governing Law. 79
Section 10.10. No Adverse Interpretation of Other Agreements. 80
Section 10.11. No Recourse Against Others. 80
Section 10.12. Successors. 80
Section 10.13. Multiple Counterparts. 80
Section 10.14. Table of Contents, Headings, etc. 80
Section 10.15. Separability. 81
EXHIBITS
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Exhibit A. Form of Note A-1
Exhibit B. Form of Legend for Global Notes B-1
Exhibit C. Form of Certificate to Be Delivered in Connection with Transfers to
Non-QIB Accredited Investors C-1
Exhibit D. Form of Certificate to Be Delivered in Connection with Transfers
Pursuant to Regulation S D-1
INDENTURE, dated as of January 22, 1998, between INTERNATIONAL SHIPHOLDING
CORPORATION, a Delaware corporation, as Issuer (the "Company") and THE BANK OF
NEW YORK, a New York banking corporation, as Trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company's 7 3/4% Senior
Notes due 2007 (the "Notes").
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person (i) assumed in
connection with the acquisition of assets or secured by the assets so acquired
from such Person or (ii) existing at the time such Person becomes a Subsidiary
(other than any Indebtedness incurred in connection with, or in contemplation
of, such asset acquisition of such Person becoming a Subsidiary). Acquired
Indebtedness shall be deemed to be incurred on the date of the related
acquisition of assets from any Person or the date the acquired Person becomes a
Subsidiary.
"Affiliate" means, with respect to any specified Person, (i) any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person or (ii) any other Person that
beneficially owns, directly or indirectly, 5% or more of such specified Person's
outstanding Capital Stock or (iii) any officer or director of any such specified
Person or any such 5% stockholder of such specified Person, and shall not
include any employee or consultant of such Person who is not otherwise an
Affiliate of such Person. For the purposes of this definition, "control" when
used with respect to any specified Person means the power to direct the
management and policies of such Person directly or indirectly, whether through
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent, co-registrar or agent for
service of notices and demands.
"Asset Sale" means any sale, issuance, conveyance, transfer, capital lease
or other disposition (including, without limitation, by way of merger,
consolidation or sale and leaseback transaction) (collectively, a "transfer"),
directly or indirectly, in one or a series of related transactions, of any of
the following (each an "Asset"): (i) Capital Stock of any Subsidiary (other than
Directors Qualifying Shares); (ii) all or substantially all of the properties
and assets of any division or line of business of the Company and Subsidiaries
(other than to a Wholly Owned Subsidiary); or (iii) other properties or assets
of the Company or any Subsidiary (other than to the Company or a Wholly Owned
Subsidiary), other than in the ordinary course of business. For the purposes of
this definition, the term "Asset Sale" shall not include (i) any transfer of
properties and assets that is governed by the provisions described under Section
5.01 of this Indenture; (ii) any transfer of properties or assets the gross
proceeds of which in the aggregate do not exceed $5 million in any year; or
(iii) any transfer of properties or assets to an Unrestricted Subsidiary
permitted to be made under the provisions described under Section 4.19 of this
Indenture.
"Attributable Debt" means, with respect to a sale and leaseback
transaction, as at the time of determination, the greater of (a) the fair market
value of the property subject to such sale and leaseback transaction (as set
forth in a Board Resolution) and (b) the present value (discounted at the
interest rate borne by the Notes, compounded annually) of the total obligations
of the lessee for rental payments during the remaining term of the lease
included in such sale and leaseback transaction (including any period for which
such lease has been extended).
"Average Life to Stated Maturity" means, as of the date of determination
with respect to any Indebtedness, the quotient obtained by dividing (i) the sum
of the products of (a) the number of years from the date of determination to the
date or dates of each successive scheduled principal payment of such
Indebtedness multiplied by (b) the amount of each such principal payment by (ii)
the sum of all such principal payments.
"Bank Credit Agreement" means (i) the $25 million credit facility to be
entered into by the Company, as borrower, and Citibank, N.A., as agent and
lender, (ii) any one or more additional agreements between the Company and one
or more financial institutions providing for the making of loans on an unsecured
revolving basis, the issuance of letters of credit and/or the creation of
bankers' acceptances, in each case for the purpose of funding the Company's
working capital requirements and general corporate purposes, and (iii) any
replacements, renewals or refinancings of the foregoing.
"Board of Directors" means the board of directors of the Company or a
Guarantor, if any, or any committee authorized to act on behalf of such board.
"Board Resolution" means with respect to any Person, a copy of a
resolution certified by the person appointed to act as secretary at the meeting
of the Board of Directors at which such resolution was adopted or by any
director present at the meeting of the Board of Directors at which such
resolution was adopted to have been duly adopted, by the Board of Directors of
such Person and to be in full force and effect on the date of such
certification.
2
"Capital Lease Obligations" means any obligations of the Company on a
Consolidated basis incurred or assumed in the ordinary course of business under
or in connection with any capital lease of real or personal property which, in
accordance with GAAP, has been recorded as a capitalized lease.
"Capital Stock" of any Person means any and all shares, interests,
participations, or other equivalents (however designated) of such Person's
capital stock, whether now outstanding or issued after the date of the
Indenture.
"Change of Control" means the occurrence of one or more of the following
events: (i) a "person" or "group" (within the meaning of Sections 13(d) and
14(d) of the Exchange Act), other than the Xxxxxxx Family, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of the
greater of (A) forty percent (40%) of the total voting power of the then
outstanding Voting Stock of the Company and (B) the total voting power of the
then outstanding Voting Stock of the Company beneficially owned in the aggregate
by the Xxxxxxx Family; (ii) the individuals who, as of the date of the
Indenture, are members of the Board of Directors of the Company (the "Incumbent
Board") cease for any reason to constitute at least two-thirds of the Board of
Directors of the Company; provided, however, that if either the election of any
new director or the nomination for election of any new director by the Company's
stockholders was approved by a vote of at least two-thirds of the Incumbent
Board, such new director shall be considered as a member of the Incumbent Board;
(iii) (A) the Company consolidates with or merges into any other Person or
conveys, transfers or leases all or substantially all of its assets to any
Person or (B) any Person merges into the Company, in either event pursuant to a
transaction in which any Voting Stock of the Company outstanding immediately
prior to the effectiveness thereof is reclassified or changed into or exchanged
for cash, securities or other property (other than any such transactions where
(x) the outstanding Voting Stock of the Company is converted into or exchanged
for (I) Voting Stock (other than Redeemable Capital Stock) of the surviving or
transferee corporation, or (II) cash, securities and/or other property in an
amount which could be paid as a Restricted Payment under the Indenture (and is
treated as such) and (y) immediately after the consummation of such transaction,
no "person" or "group" other than the Xxxxxxx Family is or becomes the
"beneficial owner," directly or indirectly of more than 35% of the total Voting
Stock of such surviving or transferee corporation); or (iv) the Company is not
in material compliance with the citizenship requirements imposed under the
Merchant Marine Act of 1920, as amended, the Merchant Marine Act of 1936, as
amended, or any other applicable United States laws for entities engaged in
coastwise trade or eligible to receive operating differential subsidies.
"Commission" means the United States Securities and Exchange Commission.
"Company" means International Shipholding Corporation, a Delaware
corporation, until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
3
"Company Request" means any written request signed in the name of the
Company by the Chairman of the Board of Directors, the President, an Executive
Vice President, the Chief Financial Officer, the Treasurer or the Controller and
attested to by any Officer of the Company.
"Consolidated Income Tax Expense" means, for any period, as applied to any
Person, the provision for federal, state, local or foreign income taxes of such
Person and its Consolidated Subsidiaries for such period as determined in
accordance with GAAP consistently applied.
"Consolidated Interest Expense" means, without duplication, for any
period, as applied to any Person, the sum of (a) the interest expense of such
Person and its Consolidated Subsidiaries for such period as determined in
accordance with GAAP consistently applied including, without limitation, (i)
amortization of debt discount and debt issuance cost, (ii) the net cost under
interest rate contracts (including amortization of discounts), (iii) the
interest portion of any deferred payment obligation, (iv) accrued interest, (v)
noncash interest payments and (vi) commissions, discounts, and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing, plus (b) the interest portion of Capital Lease Obligations paid,
accrued and/or scheduled to be paid or accrued by such Person and its
Consolidated Subsidiaries, plus (c) capitalized interest, plus (d) Preferred
Stock dividends in respect of Preferred Stock of the Company or any Subsidiary
held by Persons other than the Company or a Wholly Owned Subsidiary.
"Consolidated Net Income (Loss)" means, for any period, the Consolidated
net income (or loss) of the Company and its Consolidated Subsidiaries for such
period as determined in accordance with GAAP, adjusted, to the extent included
in calculating such net income, by excluding (i) all extraordinary gains or
losses (less all fees and expenses relating thereto); (ii) the portion of net
income (or loss) of the Company and its Consolidated Subsidiaries allocable to
minority interests in unconsolidated Persons to the extent that cash dividends
or distributions have not actually been received by such Person or one of its
Consolidated Subsidiaries; (iii) net income (or loss) of any Person combined
with the Company or any of its Subsidiaries in a "pooling of interests" basis
attributable to any period prior to the date of combination; (iv) any gain or
loss, net of taxes, realized upon the termination of any employee pension
benefit plan; (v) net gains or losses (less all fees and expenses relating
thereto) in respect of dispositions of assets other than in the ordinary course
of business; and (vi) the net income of any Subsidiary to the extent that the
declaration of dividends or similar distributions by that Subsidiary of that
income is not at the end of the fiscal quarter in which such net income was
earned permitted, directly or indirectly, by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulations applicable to that Subsidiary or its shareholders
unless, and to the extent, such net income can be paid to the Company in the
form of advances or principal repayments on intercompany indebtedness, accounts
or other obligations.
4
"Consolidated Net Tangible Assets" means, with respect to the Company, the
total assets shown on the balance sheet of the Company and its Consolidated
Subsidiaries, as determined on a Consolidated basis in accordance with GAAP
consistently applied, as of the Company's latest fiscal quarter for which
financial information is then required to be available, less goodwill and other
intangibles.
"Consolidated Net Worth" means, with respect to the Company, the
Consolidated shareholders' equity of the Company and its Subsidiaries, as
determined in accordance with GAAP consistently applied.
"Consolidation" means, with respect to any Person, the consolidation of
the accounts of such Person and each of its Subsidiaries if and to the extent
the accounts of such Person and each of its Subsidiaries would normally be
consolidated with those of such Person, all in accordance with GAAP. The term
"Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Indenture is located at 000
Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Depository" means, with respect to the Notes issued in the form of one or
more Global Notes, The Depository Trust Company or another Person designated as
Depository by the Company (or any successor thereto), which Person must be a
clearing agency registered under the Exchange Act.
"Directors Qualifying Shares" means shares of Capital Stock of a Person
held by nominees, directors or trustees pursuant to the requirements of the law
of the jurisdiction in which such Person is organized.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, with respect to any asset or property, the sale
value that would be obtained in an arm's-length transaction between an informed
and willing seller under no compulsion to sell and an informed and willing
buyer.
"Fixed Charge Coverage Ratio" means, for any period, the ratio of (a) the
sum of Consolidated Net Income, Consolidated Interest Expense and Consolidated
Income Tax Expense plus, without duplication, all depreciation, amortization and
all other non-cash charges (excluding any such non-cash charge constituting an
extraordinary item of loss or any non-cash charge which requires an accrual of
or a reserve for cash charges for any future period), in each case, for such
period, of the Company and its Subsidiaries on a Consolidated basis, all
determined in accordance with GAAP to (b) Consolidated Interest
5
Expense for such period; provided that in making such computation, the
Consolidated Interest Expense attributable to interest on any Indebtedness
computed on a pro forma basis and bearing a floating interest rate shall be
computed as if the rate in effect on the date of computation had been the
applicable rate for the entire period.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
are in effect on the date of the Indenture.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"Indebtedness" with respect to any Person is defined as, without
duplication, (i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade payables
and other accrued current liabilities incurred in the ordinary course of
business, but including, without limitation, all obligations, contingent or
otherwise, of such Person in connection with any letters of credit issued under
letter of credit facilities, acceptance facilities or other similar facilities,
now or hereafter outstanding; (ii) all obligations (other than interest, premium
and additional payments, if any) of such Person evidenced by bonds, notes,
debentures or other similar instruments; (iii) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even if the rights and remedies of
the seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), but excluding trade accounts payable
arising in the ordinary course of business; (iv) all Capital Lease Obligations
of such Person; (v) all Indebtedness referred to in clause (i), (ii), (iii), or
(iv) above of other Persons and all dividends of other Persons, the payment of
which is secured by (or for which the Holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien, upon or in
property (including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness; (vi) all guarantees of Indebtedness by such
Person; (vii) all Redeemable Capital Stock valued at the greater of its
voluntary or involuntary maximum fixed repurchase price, exclusive of accrued
and unpaid dividends; (viii) all obligations under interest rate swap or similar
agreements or currency hedge, exchange or similar agreements of such Person; and
(ix) any amendment, supplement, modification, deferral, renewal, extension or
refunding of any liability of the types referred to in clauses (i) through
(viii) above. For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Redeemable Capital
Stock, such fair market value shall be determined in good faith by the Board of
Directors of the issuer of such Redeemable Capital Stock.
6
"Indenture" means this Indenture as amended, restated or supplemented from
time to time.
"Indenture Obligations" means, the obligations of the Company and any
other obligor under this Indenture or under the Notes, including any Guarantor,
if any, to pay principal of, premium, if any, and interest on the Notes when due
and payable, and all other amounts due or to become due under or in connection
with the Indenture or the Notes and the performance of all other obligations to
the Trustee and the Holders of the Notes under the Indenture and the Notes,
according to the terms thereof.
"Independent Director" means a director of the Company other than a
director (i) who (apart from being a director of the Company or any
Subsidiaries) is an employee, insider, associate or Affiliate of the Company or
a Subsidiary, or has held any such position during the previous five years or
(ii) who is a director, an employee, insider, associate or Affiliate of another
party to the transaction in question.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501 (a)(1), (2), (3) or
(7) promulgated under the Securities Act.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Investments" means, with respect to any Person, directly or indirectly,
any advance, loan or other extension of credit or capital contribution to (by
means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or
acquisition by such Person of any Capital Stock, bonds, notes, debentures or
other securities or assets issued or owed by any other Person. Investments shall
exclude extensions of trade credit on commercially reasonable terms in
accordance with normal trade practices. For the purpose of making any
calculations under this Indenture (i) Investment shall include the amount of
Investment attributed to any Subsidiary at the time that such Subsidiary is
designated an Unrestricted Subsidiary and shall exclude the amount of Investment
attributed to any Unrestricted Subsidiary that is designated a Subsidiary (which
exclusion shall be effective upon such designation) and (ii) any property
transferred to or from an Unrestricted Subsidiary shall be valued at Fair Market
Value at the time of such transfer; provided that in each case, the Fair Market
Value of an asset or property shall be as determined by the Board of Directors
of the Company in good faith.
"Issue Date" means the date the Notes are first issued by the Company and
authenticated by the Trustee under this Indenture.
"Xxxxxxx Family" means (i) Xxxxx X. Xxxxxxx and Xxxx X. Xxxxxxx, (ii) the
wives and issue of Xxxxx X. Xxxxxxx and Xxxx X. Xxxxxxx and (iii) any Affiliate
of any of the foregoing.
7
"Joint Venture Entity" means any Person in which the Company (directly or
indirectly) owns at least a 50% interest and the remaining interest is owned by
Persons who are not Affiliates of the Company or of any Affiliate of the
Company.
"Lien" means any lien, mortgage, charge, pledge, security interest, or
other encumbrance of any kind (including any conditional sale or other title
retention agreement and any lease in the nature thereof).
"Maturity Date" means October 15, 2007.
"Medium or Long Term Contract" means a contract with a duration of more
than three years (without taking into account any extension options).
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
"Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds
thereof in the form of cash or cash equivalents including payments in respect of
deferred payment obligations when received in the form of, or stock or other
assets when disposed of for, cash or cash equivalents (except to the extent that
such obligations are financed or sold with recourse to the Company or any
Subsidiary) net of (i) brokerage commissions and other reasonable fees and
expenses (including fees and expenses of counsel and investment bankers) related
to such Asset Sale, (ii) provisions for all taxes payable as a result of such
Asset Sale, (iii) payments made to retire Indebtedness where the Holder of such
Indebtedness has a security interest in the asset sold in the Asset Sale, (iv)
amounts required to be paid to any Person (other than the Company or any
Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale
and (v) appropriate amounts to be provided by the Company or any Subsidiary, as
the case may be, in accordance with GAAP, against any liabilities associated
with such Asset Sale and retained by the Company or any Subsidiary, as the case
may be, after such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as reflected in an officers' certificate delivered to the
Trustee.
"Non-U.S. Person" means a person who is not a U.S. person, as defined in
Regulation S.
"Notes" means the Company's 7 3/4% Senior Notes due 2007 that are issued
on the Issue Date or subsequent to the Issue Date under this Indenture, as
amended or supplemented from time to time pursuant to this Indenture and, when
and if issued, the Company's 7 3/4% Senior Notes due 2007 to be issued pursuant
to the Registration Rights Agreement as contemplated hereunder.
"Offering Memorandum" means the Confidential Offering Memorandum dated
January 14, 1998 pursuant to which the Notes were offered.
8
"Officer" means, with respect to any Person, the Chairman of the Board of
Directors, the President, the Chief Financial Officer, any Executive Vice
President, the Treasurer or the Controller of such Person.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two Officers or by an Officer and an Assistant Treasurer of such
Person.
"Opinion of Counsel" means a written opinion from legal counsel reasonably
acceptable to the Trustee. Such legal counsel shall be outside counsel and not
an employee of or in-house counsel to the Company.
"Pari Passu Indebtedness" means Indebtedness of the Company ranking pari
passu in right of payment with the Notes.
"Permitted Indebtedness" means (i) Indebtedness of the Company or any of
its Subsidiaries outstanding on the date of the Indenture and not repaid out of
the proceeds of the Offering; (ii) Indebtedness of the Company pursuant to the
Notes originally issued on the Issue Date; (iii) Indebtedness of the Company
under one or more Bank Credit Agreements in an aggregate principal amount at any
one time outstanding not to exceed $50,000,000; (iv) Indebtedness incurred in
relation to the provision of bonds, guarantees, letters of credit or similar
obligations required by the United States Federal Maritime Commission or other
governmental or regulatory agencies in connection with Vessels owned or business
conducted by the Company or any Subsidiary; (v) Indebtedness of the Company or
any Subsidiary to finance the replacement of a Vessel upon a total loss,
destruction, condemnation, confiscation, requisition, seizure, forfeiture or
other taking of title to or use of such Vessel (provided that such condemnation,
confiscation, requisition, seizure, forfeiture or other taking of title to or
use of such Vessel does not arise out of any misconduct or negligent omission by
the Company or any of its Subsidiaries) (collectively, a "Total Loss") in an
aggregate amount up to the contract price for such replacement Vessel less all
compensation, damages and other payments (including insurance proceeds other
than in respect of business interruption insurance) received by the Company or
any Subsidiary from any Person in connection with the Total Loss in excess of
amounts actually used to repay Indebtedness secured by the Vessel subject to the
Total Loss; (vi) Indebtedness of the Company or any Subsidiary incurred to
finance the construction or acquisition of one or more Vessels in the aggregate
principal amount outstanding at any time (including any renewals, extensions,
substitutions, refundings, refinancings or replacements thereof pursuant to
clause (viii) below) of up to $100,000,000 (in addition to any such Indebtedness
that was not incurred as Permitted Indebtedness as determined at the time of
incurrence by the Board of Directors and evidenced by a Board Resolution);
provided that (x) with respect to Indebtedness incurred to finance the
construction of any such Vessel, such Indebtedness does not exceed 80% of the
contract price for such Vessel, (y) with respect to Indebtedness incurred to
finance the acquisition of any such Vessel, such Indebtedness does not exceed
the lesser of (i) the contract price for the acquisition of such Vessel or (ii)
the fair market value of such Vessel at the time of acquisition and (z) each
such Vessel is to be initially employed (after giving effect to any intermediary
intercompany transactions) pursuant to
9
a then existing binding Medium or Long-Term Contract with a third party who is
not an Affiliate of the Company or a then existing binding contract with the
United States Military Sealift Command that has a term (including any extensions
at the option of the United States Military Sealift Command) of at least three
years; (vii) any guarantees of Indebtedness of the Company by a Subsidiary
entered into in accordance with Section 4.11 of this Indenture; (viii) any
renewals, extensions, substitutions, refundings, refinancings or replacements of
any Indebtedness described in clauses (i), (ii), (v) and (vi) of this
definition, including any successive renewals, extensions, substitutions,
refundings, refinancings or replacements so long as such renewal, extension,
substitution, refunding, refinancing or replacement does not result in an
increase in the aggregate principal amount of the outstanding Indebtedness
represented thereby (plus the amount of any premium required to be paid under
the terms of the instrument governing the Indebtedness being so renewed,
extended, substituted, refunded, refinanced or replaced) and, in the case of the
Notes or any extension, renewal, refunding, refinancing, or replacement thereof,
does not change the Stated Maturity of any payment of principal thereof to a
date earlier than the Stated Maturity existing at the time of such extension,
renewal, refunding, refinancing or replacement; (ix) Indebtedness of the Company
owing to and held by any Subsidiary of the Company or Indebtedness of a
Subsidiary owing to and held by the Company or any other Subsidiary of the
Company; provided, however, that any subsequent transfer or any other event
which results in any such Subsidiary ceasing to be a Subsidiary of the Company
or any subsequent transfer of any such Indebtedness (except to the Company or
another Subsidiary) would be deemed, in each case, to constitute the incurrence
of such Indebtedness by the issuer thereof; (x) any guarantee of Indebtedness
permitted to be incurred under the Indenture; provided that any Guarantor
complies with Section 4.11 of this Indenture; and (xi) Indebtedness of the
Company or a Subsidiary not covered by any other clause of this definition not
to exceed an aggregate principal amount at any time outstanding of $50,000,000
(as determined at the time of issuance by the Board of Directors and evidenced
by a Board Resolution).
"Permitted Investment" means (i) Investments in any of the Notes or any
Guarantees; (ii) Temporary Cash Investments; (iii) Investments by the Company in
or to any Subsidiary of the Company and Investments by a Subsidiary of the
Company in or to the Company or a Subsidiary of the Company (or a person who
becomes a Subsidiary as a result of such Investment or who merges or
consolidates into the Company or a Subsidiary of the Company); (iv) loans or
advances not in excess of $1 million outstanding in the aggregate at any time to
employees in the ordinary course of business; (v) Investments acquired or
retained from another Person in connection with any Asset Sale or other
disposition of assets to such Person; (vi) Investments by any Subsidiary or any
Unrestricted Subsidiary in the Company; (vii) Investments in an Unrestricted
Subsidiary to the extent permitted under clauses (i)(x) and (ii) of Section 4.19
of this Indenture (it being understood that any Investment in an Unrestricted
Subsidiary made in reliance upon clause (i)(y) thereunder shall not be deemed to
be a Permitted Investment); and (viii) Investments not to exceed 5% of the
Company's Consolidated Net Tangible Assets at the time of determination.
10
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred stock whether now outstanding, or issued after the date of
the Indenture, and including, without limitation, all classes and series of
preferred stock.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth on Exhibit A.
"Qualified Capital Stock" of any Person means any and all Capital Stock of
such Person other than Redeemable Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A promulgated under the Securities Act.
"Redeemable Capital Stock" means any Capital Stock that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is, or upon the happening of an event or passage of time would be,
required to be redeemed prior to the final Stated Maturity of the Notes or is
redeemable at the option of the Holder thereof at any time prior to such final
Stated Maturity, or is convertible into or exchangeable for debt securities at
any time prior to such final Stated Maturity.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of January 22, 1998 among the Company, and Citicorp Securities, Inc.,
Citibank Canada Securities Limited and Citibank International plc, as Initial
Purchasers.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Responsible Officer" when used with respect to the Trustee, means any
officer within the corporate trust department of the Trustee (or any successor
group of the Trustee) or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
promulgated under the Securities Act; provided that the Trustee shall be
entitled to request and conclusively rely upon an Opinion of Counsel with
respect to whether any Note is a Restricted Security.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"S&P" means Standard & Poor's Corporation and its successors.
11
"Securities Act" means the Securities Act of 1933, as amended.
"Significant Subsidiary" means any Subsidiary (including its subsidiaries)
of the Company which at the time of determination meets any of the following
conditions: (1) the Company's and its other Subsidiaries' investments in the
Subsidiary exceeds 10% of the total assets of the Company and its Subsidiaries
Consolidated as of the end of the most recently completed fiscal year; (2) the
Company's and its other Subsidiaries' proportionate share of the total assets
(after intercompany eliminations) of the Subsidiary exceeds 10% of the total
assets of the Company and its Subsidiaries Consolidated as of the end of the
most recently completed fiscal year; or (3) the Company's and its other
Subsidiaries' equity in the income from continuing operations before income
taxes, extraordinary items and cumulative effect of a change in accounting
principle of the Subsidiary exceeds 10% of such income of the Company and its
Subsidiaries Consolidated for the most recently completed fiscal year.
"Stated Maturity" when used with respect to any Note or any installment of
interest thereon, means the dates specified in such Note as the fixed date on
which the principal of such Note or such installment of interest is due and
payable, and when used with respect to any other Indebtedness, means the date
specified in the instrument governing such Indebtedness as the fixed date on
which the principal of such Indebtedness or any installment of interest is due
and payable.
"Subordinated Indebtedness" means Indebtedness of the Company which is
subordinated in right of payment to the Notes.
"Subsidiary," with respect to any Person, means (i) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (ii) any
other Person (other than a corporation) including a partnership in which the
Company, a Subsidiary of the Company or the Company and a Subsidiary of the
Company, directly or indirectly, at the date of determination thereof, has at
least a majority ownership interest. For the purposes of this Indenture, an
Unrestricted Subsidiary shall not be deemed a subsidiary of the Company.
"Temporary Cash Investments" means any of the following: (i) any
investment in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency
thereof, in each case, maturing within 360 days of the date of acquisition
thereof, (ii) investments in time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States having capital, surplus and undivided profits
aggregating in excess of $300,000,000 and whose debt is rated "A" (or such
similar equivalent rating) or higher by at least one nationally recognized
statistical rating organization (as defined in Rule 436 under the Securities
Act), (iii) repurchase obligations with a term of not more
12
than 30 days for underlying securities of the types described in clause (i)
above entered into with a bank meeting the qualifications described in clause
(ii) above and (iv) investments in commercial paper, maturing not more than 90
days after the date of acquisition, issued by a corporation (other than an
Affiliate or Subsidiary of the Company) organized in existence under the laws of
the United States of America or any foreign country recognized by the United
States of America with a rating at the time as of which any investment therein
is made of "P-2" (or higher) according to Moody's or "A-2" (or higher) according
to S&P.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code sections
77aaa-77bbbb) as in effect on the date of this Indenture (except as provided in
Section 8.03 hereof).
"Title XI Financing" means any Indebtedness incurred by the Company or any
Subsidiary which is guaranteed by the United States (or any agency thereof)
pursuant to Title XI of the Merchant Marine Act of 1936, as amended.
"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer trust accounts.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Unrestricted Subsidiary" means (1) any subsidiary of the Company that at
the time of determination shall be an Unrestricted Subsidiary (as designated by
the Board of Directors of the Company, as provided below) and (2) any subsidiary
of an Unrestricted Subsidiary. The Board of Directors of the Company may
designate any subsidiary of the Company (including any newly acquired or newly
formed subsidiary) to be an Unrestricted Subsidiary if all of the following
conditions apply: (a) such subsidiary is not liable, directly or indirectly,
with respect to any Indebtedness other than Unrestricted Subsidiary Indebtedness
and (b) any Investment in such subsidiary (which shall be deemed to be made as a
result of designating such subsidiary an Unrestricted Subsidiary) shall not
violate the provisions of Section 4.19 of this Indenture. Any such designation
by the Board of Directors of the Company shall be evidenced to the Trustee by
filing with the Trustee a Board Resolution giving effect to such designation and
an Officers' Certificate certifying that such designation complies with the
foregoing conditions. The Board of Directors of the Company may designate any
Unrestricted Subsidiary as a Subsidiary; provided that immediately after giving
effect to such designation, the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to the restrictions
under Section 4.06 of this Indenture.
"Unrestricted Subsidiary Indebtedness" of any Unrestricted Subsidiary
means Indebtedness of such Unrestricted Subsidiary (a) as to which neither the
Company nor any Subsidiary is directly or indirectly liable (by virtue of the
Company or any such Subsidiary being the primary obligor on, guarantor of, or
otherwise liable in any respect to, such Indebtedness), except to the extent the
Company or any Subsidiary is permitted
13
to incur, create or assume any guarantee of Indebtedness of any Affiliate
pursuant to the provisions under Section 4.07 of this Indenture, in which case
the Company shall be deemed to have made a Restricted Payment equal to the
principal amount of any such Indebtedness to the extent guaranteed and (b)
which, upon the occurrence of a default with respect thereto, does not result
in, or permit any holder of any Indebtedness of the Company or any Subsidiary to
declare, a default on such Indebtedness of the Company or any Subsidiary or
cause the payment thereof to be accelerated or payable prior to its Stated
Maturity.
"U.S. Government Obligations" means (a) securities that are direct
obligations of the United States of America for the payment of which its full
faith and credit are pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt.
"Vessels" means the shipping vessels owned by and registered in the name
of the Company or any of its Subsidiaries or operated by the Company pursuant to
a lease or other operating agreement constituting a Capital Lease Obligation.
"Voting Stock" means stock of the class or classes pursuant to which the
holders thereof have the general voting power under ordinary circumstances to
elect at least a majority of the board of directors, managers or trustees of a
corporation (irrespective of whether or not at the time stock of any other class
or classes shall have or might have voting power by reason of the happening of
any contingency).
"Wholly Owned Subsidiary" means a Subsidiary all the Capital Stock of
which (other than Directors Qualifying Shares) is owned by the Company or
another Wholly Owned Subsidiary of the Company.
14
Section 1.02. Other Definitions.
The definitions of the following terms may be found in the sections
indicated as follows:
Term Defined in Section
---- ------------------
"Agent Members" 2.14
"Business Day" 10.08
"Covenant Defeasance" 9.03
"Deficiency" 4.08
"Event of Default" 6.01
"Excess Proceeds" 4.08
"Global Notes" 2.01
"Guarantee" 4.11
"Guarantor" 4.11
"incur" 4.06
"Legal Defeasance" 9.02
"Legal Holiday" 10.08
"Note Amount" 4.08
"Offer" 4.08
"Offered Price" 4.08
"Offshore Physical Notes" 2.01
"Paying Agent" 2.03
"Physical Notes" 2.01
"Registered Exchange" 2.02
"Registrar" 2.03
"Regulation S Global Notes" 2.01
"Restricted Payments" 4.07
"Rule 144A Global Note" 2.01
"Surviving Entity" 5.01
"Transaction Survivor" 5.01
"U.S. Physical Notes" 2.01
15
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the portion of
such provision required to be incorporated herein in order for this Indenture to
be qualified under the TIA is incorporated by reference in and made a part of
this Indenture. The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes.
"indenture securityholder" means a Holder or Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor on the indenture securities" means the Company, or any other
obligor on the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined in the TIA by reference to another statute or defined by Commission rule
have the meanings therein assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural include
the singular; and
(5) words used herein implying any gender shall apply to every gender.
16
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A which is incorporated in and made part of
this Indenture. The Notes may have notations, legends or endorsements required
by law, stock exchange rule or usage. The Company may use "CUSIP" numbers in
issuing the Notes. The Company shall approve the form of the Notes. Each Note
shall be dated the date of its authentication.
The Notes offered and sold (i) in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global Notes in registered form
(the "Rule 144A Global Notes"), (ii) pursuant to Regulation S shall be issued
initially in the form of one or more permanent global Notes in registered form
(the "Regulation S Global Notes" and, together with the Rule 144A Global Notes,
the "Global Notes"), in each case substantially in the form set forth in Exhibit
A, deposited with the Trustee, as custodian for the Depository, duly executed by
the Company and authenticated by the Trustee as hereinafter provided and shall
bear the legend set forth on Exhibit B. The aggregate principal amount of any
Global Note may from time to time be increased or decreased by adjustments made
on the records of the Trustee, as custodian for the Depository, as hereinafter
provided.
Notes offered and sold in offshore transactions in reliance on Regulation
S may be issued in the form of certificated Notes in registered form set forth
in Exhibit A (the "Offshore Physical Notes"). Notes offered and sold in reliance
on Rule 144A may each also be issued, in the form of certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "U.S.
Physical Notes"). The Offshore Physical Notes and the U.S. Physical Notes are
sometimes collectively herein referred to as the "Physical Notes."
Section 2.02. Execution and Authentication.
The Notes shall be executed on behalf of the Company by two Officers of
the Company or an Officer and an Assistant Secretary of the Company. Such
signature may be either manual or facsimile.
If an Officer whose signature is on a Note no longer holds that office at
the time the Trustee authenticates the Note, the Note shall be valid
nevertheless.
17
A Note shall not be valid until the Trustee manually signs the certificate
of authentication on the Note. Such signature shall be conclusive evidence that
the Note has been authenticated under this Indenture.
The Trustee or an authenticating agent shall authenticate Notes for
original issue in the aggregate principal amount not to exceed $160,000,000 upon
a Company Request in one or more series, provided that the aggregate principal
amount of Notes on the Issue Date shall not exceed $110,000,000. The aggregate
principal amount of Notes outstanding at any time may not exceed such amount
except as provided in Section 2.07 hereof. Upon receipt of the Company Request,
the Trustee shall authenticate an additional series of Notes in an aggregate
principal amount not to exceed $160,000,000 for issuance in exchange for all
Notes previously issued pursuant to an exchange offer registered under the
Securities Act (a "Registered Exchange") or pursuant to a Private Exchange (as
defined in the Registration Rights Agreement), provided that the aggregate
principal amount of Exchange Notes in exchange for the Notes originally issued
on the Issue Date shall not exceed $110,000,000. Exchange Notes (as defined in
the Registration Rights Agreement) may have such distinctive series designation
and "CUSIP" numbers as and such changes in the form thereof as are specified in
the Company Request referred to in the preceding sentence. Exchange Notes issued
pursuant to a Registered Exchange shall not bear the Private Placement Legend.
The Notes shall be issuable only in registered form with out coupons and only in
denominations of $1,000 and integral multiples thereof.
The Trustee may appoint an authenticating agent to authenticate Notes. Any
such appointment shall be evidenced by an instrument signed by an authorized
officer of the Trustee, a copy of which shall be furnished to the Company. An
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same right 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 where Notes may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency located in the Borough of Manhattan, City of New York, State of New
York where Notes may be presented for payment ("Paying Agent") and an office or
agency where notices and demands to or upon the Company in respect of the Notes
and this Indenture may be served. The Registrar shall keep a register of the
Notes and of their transfer and exchange. The Registrar shall provide the
Company a current copy of such register from time to time upon request of the
Company. The Company may have one or more co-registrars and one or more
additional paying agents. Neither the Company nor any Affiliate may act as
Paying Agent. The Company may change any Paying Agent, Registrar or co-registrar
without notice to any Noteholder.
18
The Company shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this Indenture. The agreement shall
implement the provisions of this Indenture that relate to such Agent. The
Company shall notify the Trustee of the name and address of any such Agent. If
the Company fails to maintain a Registrar or Paying Agent, or agent for service
of notices and demands, or fails to give the foregoing notice, the Trustee shall
act as such. The Company initially appoints the Trustee as Registrar, Paying
Agent and agent for service of notices and demands in connection with the Notes.
Section 2.04. Paying Agent To Hold Money in Trust.
On or before each due date of the principal of and interest on any Notes,
the Company shall deposit with the Paying Agent a sum sufficient to pay such
principal and interest so becoming due. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee and the Trustee may at
any time during the continuance of any payment default, upon written request to
a Paying Agent, require such Paying Agent to forthwith pay to the Trustee all
sums so held in trust by such Paying Agent together with a complete accounting
of such sums. Upon doing so, the Paying Agent shall have no further liability
for the money.
Section 2.05. Noteholder 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
Noteholders. If the Trustee is not the Registrar, the Company shall furnish to
the Trustee on or before each April 1 and October 1 in each year, and at such
other times as the Trustee may request in writing, a list in such form and as of
such date as the Trustee may reasonably require of the names and addresses of
Noteholders.
Section 2.06. Transfer and Exchange.
When a Note is presented to the Registrar with a request to register the
transfer thereof, the Registrar shall register the transfer as requested if the
requirements of applicable law are met and, when Notes are presented to the
Registrar with a request to exchange them for an equal principal amount of Notes
of other authorized denominations, the Registrar shall make the exchange as
requested; provided that every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Registrar
duly executed by the Holder thereof or his attorney duly authorized in writing.
To permit transfers and exchanges, upon surrender of any Note for registration
of transfer at the office or agency maintained pursuant to Section 2.03 hereof,
the Company shall execute and the Trustee shall authenticate Notes at the
Registrar's request. Any exchange or transfer shall be without charge, except
that the Company may require payment by the Holder of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation to a
transfer or exchange, but
19
this provision shall not apply to any exchange pursuant to Sections 2.09 or 8.05
hereof. The Trustee shall not be required to register transfers of Notes or to
exchange Notes for a period of 15 days before selection of any Notes to be
redeemed. The Trustee shall not be required to exchange or register transfers of
any Notes called or being called for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
Any Holder of the Global Note shall, by acceptance of such Global Note,
agree that transfers of the beneficial interests in such Global Note may be
effected only through a book entry system maintained by the Holder of such
Global Note (or its agent), and that ownership of a beneficial interest in the
Global Note shall be required to be reflected in a book entry.
Each Holder of a Note agrees to indemnify the Company and the Trustee
against any liability that may result from the transfer, exchange or assignment
of such Holder's Note in violation of any provision of this Indenture and/or
applicable U.S. Federal or state securities law.
Prior to the due presentation for registration of transfer of any Note,
the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar
may deem and treat the Person in whose name a Note is registered as the absolute
owner of such Note for the purpose of receiving payment of principal of and
interest, if any, on such Note and for all other purposes whatsoever, whether or
not such Note is overdue, and none of the Company, the Trustee, the Paying
Agent, the Registrar or any co-registrar shall be affected by notice to the
contrary.
All Notes issued upon any transfer or exchange pursuant to this Section
2.06 will evidence the same debt and will be entitled to the same benefits under
this Indenture as the Notes surrendered upon such transfer or exchange.
Section 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the Holder of a
Note presents evidence to the satisfaction of the Company and the Trustee that
the Note has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Note if the requirements of
Section 8-405 of the New York Uniform Commercial Code as in effect on the date
of this Indenture are met. An indemnity bond may be required by the Company or
the Trustee that is sufficient in the judgment of the Company and the Trustee to
protect the Company, the Trustee or any Agent from any loss which any of them
may suffer if a Note is replaced. In every case of destruction, loss or theft,
the applicant shall also furnish to the Company and to the Trustee evidence to
their satisfaction of the destruction, loss or the theft of such Note and the
ownership thereof. The Company and the Trustee may charge for their expenses
(including reasonable attorneys' fees and expenses) in replacing a Note. Every
replacement Note is an additional obligation of the Company. In the event any
such mutilated, lost, destroyed or wrongfully taken Note has become due and
payable, the Company in its discretion
20
may pay such Note instead of issuing a new Note in replacement thereof. The
provisions of this Section 2.07 are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to replacement or payment of
mutilated, lost, destroyed or wrongfully taken Notes.
Section 2.08. Outstanding Notes.
Notes outstanding at any time are all Notes authenticated by the Trustee
except for those cancelled by it, those delivered to it for cancellation, and
those described in this Section 2.08 as not outstanding.
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding until the Company and the Trustee receive proof satisfactory to each
of them that the replaced Note is held by a bona fide purchaser.
If a Paying Agent holds on the Maturity Date money sufficient to pay the
principal of, premium, if any, and accrued interest on Notes payable on that
date, then on and after that date, such Notes cease to be outstanding and
interest on them ceases to accrue.
Subject to Section 10.06, a Note does not cease to be outstanding solely
because the Company or an Affiliate holds the Note.
Section 2.09. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may prepare and
the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form, and shall carry all rights, of definitive Notes but
may have variations that the Company considers appropriate for temporary Notes.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Notes in exchange for temporary Notes upon surrender of
such temporary Notes at the office or agency maintained pursuant to Section 2.03
hereof.
Section 2.10. Cancellation.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and the Paying Agent shall forward to the Trustee any Notes
surrendered to them for transfer, exchange or payment. The Trustee shall cancel
and return such Notes to the Company in accordance with its normal practice, all
Notes surrendered for transfer, exchange, payment or cancellation and if such
Notes are destroyed, deliver a certificate of destruction to the Company unless
the Company instructs the Trustee in writing to deliver the Notes to the
Company. Subject to Section 2.07 hereof, the Company may not issue new Notes to
replace Notes in respect of which it has previously paid all principal, premium
and interest accrued thereon, or delivered to the Trustee for cancellation.
21
Section 2.11. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted amounts, plus any interest payable on defaulted amounts
pursuant to Section 4.01 hereof, to the persons who are Noteholders on a
subsequent special record date. The Company shall fix the special record date
and payment date in a manner satisfactory to the Trustee and provide the Trustee
at least 20 days notice of the proposed amount of defaulted interest to be paid
and the special payment date. At least 15 days before the special record date,
the Company shall mail or cause to be mailed to each Noteholder at his address
as it appears on the Notes register maintained by the Registrar a notice that
states the special record date, the payment date (which shall be not less than
five nor more than ten days after the special record date), and the amount to be
paid. In lieu of the foregoing procedures, the Company may pay defaulted
interest in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Notes may be listed, and upon such notice
as may be required by such exchange if, after written notice given by the
Company to the Trustee of such proposed method of payment, such payment shall be
deemed satisfactory to the Trustee.
Section 2.12. Deposit of Moneys.
Prior to 12:00 noon, New York City time, on each Interest Payment Date and
Maturity Date, the Company shall have deposited with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
on such Interest Payment Date or Maturity Date, as the case may be, in a timely
manner which permits the Trustee to remit payment to the Holders on such
Interest Payment Date or Maturity Date, as the case may be. The principal and
interest on Global Notes shall be payable to the Depository or its nominee, as
the case may be, as the sole registered owner and the sole Holder of the Global
Notes represented thereby. The principal and interest on Notes in certificated
form shall be payable at the office of the Paying Agent.
Section 2.13. CUSIP Number.
The Company in issuing the Notes may use a "CUSIP" number(s), and if so,
the Trustee shall use the CUSIP number(s) in notices of redemption or exchange
as a convenience to Holders, provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number(s)
printed in the notice or on the Notes, and that reliance may be placed only on
the other identification numbers printed on the Notes and any such redemption or
exchange shall not be affected by any defect in or omission of such number(s).
Section 2.14. Book-Entry Provisions for Global Notes.
(a) The Global Notes initially shall (i) be Registered in the name of the
Depository or the nominee of such Depository, (ii) be delivered to the Trustee
as custodian for such Depository and (iii) bear legends as set forth in Exhibit
B.
22
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Note, and the Depository may be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of the Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Note.
(b) Transfers of Global Notes shall be limited to transfers in whole, but
not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in the Global Notes may be transferred or
exchanged for Physical Notes and Physical Notes may be transferred or exchanged
for beneficial interests in Global Notes, in each case, in accordance with the
rules and procedures of the Depository and the provisions of Section 2.15. In
addition, Physical Notes shall be issued to all beneficial owners in exchange
for their beneficial interests in Global Notes if (i) the Depository notifies
the Company that it is unwilling or unable to continue as Depository for any
Global Note and a successor depositary is not appointed by the Company within 90
days of such notice or (ii) an Event of Default has occurred and is continuing
and the Registrar has received a written request from the Depository to issue
Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred or exchanged,
and the Company shall execute, and the Trustee shall upon receipt of a written
order from the Company authenticate and make available for delivery, one or more
Physical Notes of like tenor and amount.
(d) In connection with the transfer of Global Notes as an entirety to
beneficial owners pursuant to paragraph (b), the Global Notes shall be deemed to
be surrendered to the Trustee for cancellation, and the Company shall execute,
and the Trustee shall authenticate and deliver, to each beneficial owner
identified by the Depository in writing in exchange for its beneficial interest
in the Global Notes, an equal aggregate principal amount of Physical Notes of
authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b), (c) or (d)
shall, except as other wise provided by paragraphs (a)(i)(x) and (c) of Section
2.15, bear the Private Placement Legend.
(f) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Agent
23
Members and Persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under this Indenture or the Notes.
Section 2.15. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-U.S.
Persons. The following provisions shall apply with respect to the registration
of any proposed transfer of a Note constituting a Restricted Security to any
Institutional Accredited Investor which is not a QIB or to any Non- U.S. Person:
(i) the Registrar shall register the transfer of any Note constituting a
Restricted Security, whether or not such Note bears the Private Placement
Legend, if (x) the requested transfer is subsequent to a date which is two years
after the later of the Issue Date and the last date on which the Company or any
of its Affiliates was the owner of such Note or (y) (1) in the case of a
transfer to an Institutional Accredited Investor which is not a QIB (excluding
Non-U.S. Persons), the proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit C hereto or (2) in the case of
a transfer to a Non-U.S. Person (including a QIB), the proposed transferor has
delivered o the Registrar a certificate substantially in the form of Exhibit D
hereto; and
(ii) if the proposed transferor is an Agent Member holding a beneficial
interest in a Global Note, upon receipt by the Registrar of (x) the certificate,
if any, required by paragraph (i) above and (y) instructions given in accordance
with the Depository's and the Registrar's procedures, whereupon
(a) the Registrar shall reflect on its books and records the date and (if
the transfer does not involve a transfer of outstanding Physical Notes) a
decrease in the principal amount of a Global Note in an amount equal to the
principal amount of the beneficial interest in a Global Note to be transferred,
and (b) the Company shall execute and the Trustee shall authenticate and make
available for delivery one or more Physical Notes of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with respect
to the registration of any proposed transfer of a Note constituting a Restricted
Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer if such transfer is being
made by a proposed transferor who has checked the box provided for on the form
of Note stating, or has otherwise advised the Company and the Registrar in
writing, that the sale has been made in compliance with the provisions of Rule
144A to a transferee who has signed the certification provided for on the form
of Note stating, or has otherwise advised the Company and the Registrar in
writing, that it is purchasing the Note for its own account or an account with
respect to which it exercises sole investment discretion and that it and any
such account is a QIB within the meaning of Rule 144A, and is aware that the
sale to it is being made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Company as it has requested pursuant to
Rule 144A or has determined not to request such information and that it is aware
that the transferor is
24
relying upon its foregoing representations in order to claim the exemption from
registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the Notes to be
transferred consist of Physical Notes which after transfer are to be evidenced
by an interest in the Global Note, upon receipt by the Registrar of instructions
given in accordance with the Depository's and the Registrar's procedures, the
Registrar shall reflect on its books and records the date and an increase in the
principal amount of the Global Note in an amount equal to the principal amount
of the Physical Notes to be transferred, and the Trustee shall cancel the
Physical Notes so transferred.
(c) Private Placement Legend. Upon the transfer, exchange or replacement
of Notes not bearing the Private Placement Legend, the Registrar shall deliver
Notes that do not bear the Private Placement Legend. Upon the transfer, exchange
or replacement of Notes bearing the Private Placement Legend, the Registrar
shall deliver only Notes that bear the Private Place ment Legend unless (i) the
circumstances contemplated by paragraph (a)(i)(x) of this Section 2.15 exist,
(ii) there is delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act or (iii) such Note
has been sold pursuant to an effective registration statement under the
Securities Act.
(d) General. By its acceptance of any Note bearing the Private Placement
Legend, each Holder of such a Note acknowledges the restrictions on transfer of
such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.14 or this Section 2.15.
The Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable notice to the Registrar.
ARTICLE 3
REDEMPTION
Section 3.01. No Redemption.
Except for the redemptions provided for in Sections 4.08 and 4.15, the
Company may not redeem the Notes, in whole or in part, at any time.
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ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay the principal of and interest (including all
Liquidated Damages (as defined in the Registration Rights Agreement) as provided
in the Registration Rights Agreement) on the Notes on the dates and in the
manner provided in the Notes and this Indenture. An installment of principal or
interest shall be considered paid on the date it is due if the Trustee or Paying
Agent holds on that date U.S. legal tender designated for and sufficient to pay
such installment.
The Company shall pay interest on overdue principal (including
post-petition interest in a proceeding under any Bankruptcy Law), and overdue
interest, to the extent lawful, at the rate specified in the Notes.
Section 4.02. Provision of Financial Statements and Other Information.
(a) Subject to clause (b) hereof, the Company shall deliver to the Trustee
(including sufficient copies to be delivered to the Holders by the Trustee)
within 15 calendar days after the filing of the same with the Commission, copies
of the quarterly and annual reports and other reports, if any, which the Company
is required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act or pursuant to this Section 4.02. At all times when the Company is
not subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company will nonetheless file with the Commission, to the extent
permitted by the Commission, and regardless of any such filing provide the
Trustee within 15 calendar days of the filing thereof with the Commission (or
within 15 calendar days of when filing would ordinarily be required if not then
permitted) (including sufficient copies to be delivered to the Holders by the
Trustee) with such quarterly and annual reports and other reports specified in
clause (b) below. Upon qualification of this Indenture under the TIA, the
Company shall also comply with the provisions of TIA Section 314(a).
(b) The Company shall (i) within 105 days after the end of its fiscal year
file (or provide to the Trustee in accordance with clause (a) above if filing is
not then permitted) annual reports referred to in the foregoing clause (a) on
Form 10-K (or any successor form) containing the information required to be
contained therein (or required in such successor form), which shall include
consolidated financial statements and notes thereto, together with a report
thereon expressed by an independent accounting firm and management's discussion
and analysis of financial condition and results of operations; (ii) within 60
days after the end of each of the first, second and third fiscal quarters of
each fiscal year, file (or provide to the Trustee in accordance with clause (a)
above if filing is not then permitted) reports on Form 10-Q (or any successor
form) containing the
26
information required to be contained therein (or required in such successor
form), which shall include unaudited consolidated financial statements and
management's discussion and analysis of financial condition and results of
operations for the first three quarters of each fiscal year; and (iii) promptly
from time to time after the occurrence of any event required to be therein
reported, such other reports on Form 8-K (or any successor form) containing the
information required to be contained therein (or required in such successor
form). Each of the reports shall be prepared in accordance with GAAP, as then in
effect, consistently applied and shall be prepared in accordance with the
applicable rules and regulations of the Commission.
(c) The Company will, promptly upon written request, provide to any Holder
of Notes or any prospective transferee of any such Holder, at the Company's
expense, any information concerning the Company (including financial statements)
necessary in order to permit such Holder to sell or transfer Notes in compliance
with Rule 144 and Rule 144A under the Securities Act.
Section 4.03. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may law fully do so) that it
will not at any time insist upon, or plead (as a defense or otherwise) or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law which would prohibit or forgive the
Company from paying all or any portion of the principal of, premium, if any,
and/or interest on the Notes as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
the Company hereby expressly waives all benefit or advantage of any such law,
and covenants that it will not 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 had been enacted.
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year and on or before 45 days after the end of the first, second
and third quarters of each fiscal year, an Officers' Certificate (one of the
signers of which shall be the principal executive officer, principal financial
officer or principal accounting officer of the Company) stating that a review of
the activities of the Company and its Subsidiaries during such fiscal year or
fiscal quarter, as the case may be, 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, in the case
of Restricted Payments, listing all Restricted Payments for such quarter, 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 or such Defaults or Events of Default
27
of which he or she may have knowledge and what action each is taking or proposes
to take with respect thereto) and that to the best of his or her knowledge no
event has occurred and remains in existence by reason of which payments on
account of the principal of or interest, if any, on the Notes 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.
(b) The Company will, so long as any of the Notes are outstanding, deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default, an Officers' Certificate specifying such Default or Event of
Default and what action the Company is taking or proposes to take with respect
thereto.
Section 4.05. Taxes.
The Company shall, and shall cause each of its Subsidiaries to, pay prior
to delinquency all material taxes, assessments, and governmental levies except
as contested in good faith and by appropriate proceedings.
Section 4.06. Limitation on Indebtedness.
The Company will not, and will not permit any Subsidiaries to, create,
incur, assume or, directly or indirectly, guarantee the payment of
(collectively, "incur") any Indebtedness (including any Acquired Indebtedness
but excluding Permitted Indebtedness) unless (a) at the time of such event and
after giving effect thereto on a pro forma basis the Company's Fixed Charge
Coverage Ratio for the four full fiscal quarters immediately preceding such
event, taken as one period calculated on the assumption that such Indebtedness
had been incurred on the first day of such four-quarter period and, in the case
of Acquired Indebtedness, on the assumption that the related acquisition
(whether by means of purchase, merger, consolidation or otherwise) also had
occurred on such date with the appropriate adjustments with respect to such
acquisition being included in such pro forma calculation, would have been at
least equal to 2.0:1.0 and (b) in the case of any Indebtedness of the Company,
the Indebtedness is pari passu in right of payment to the Notes or is
Subordinated Indebtedness provided that such Subordinated Indebtedness has a
Stated Maturity (including any scheduled repayments or sinking fund payments)
subsequent to one year after the maturity of the Notes.
Section 4.07. Limitation on Restricted Payments.
The Company will not, and will not permit any Subsidiary to, directly or
indirectly:
(i) declare or pay any dividend on, or make any distribution to Holders
of, any Capital Stock of the Company (other than dividends or distributions
payable in shares of Qualified Capital Stock of the Company or in options,
warrants or other rights to purchase Qualified Capital Stock of the Company);
28
(ii) purchase, redeem or otherwise acquire or retire for value any Capital
Stock of the Company or any Affiliate thereof (other than any Wholly Owned
Subsidiary of the Company) or any option, warrant or other right to acquire such
Capital Stock;
(iii) make any principal payment on, or redeem, repurchase, defease or
otherwise acquire or retire for value, prior to any scheduled repayment, sinking
fund payment or maturity any Subordinated Indebtedness of the Company;
(iv) declare or pay any dividend or distribution on any Capital Stock of
any Subsidiary to any Person other than the Company or any Wholly Owned
Subsidiaries or purchase, redeem or otherwise acquire or retire for value any
Capital Stock of any Subsidiary held by any Person (other than the Company or
any Wholly Owned Subsidiaries);
(v) incur, create or assume any guarantee of Indebtedness of any Affiliate
(other than with respect to (i) guarantees of Indebtedness of any Wholly Owned
Subsidiary of the Company by the Company or by any Subsidiary or (ii) guarantees
of Indebtedness of the Company by any Subsidiary, in each case in accordance
with the terms of the Indenture); or
(vi) make any Investment (other than any Permitted Investment) in any
Person (such payments described in (i) through (vi) collectively, "Restricted
Payments");
unless at the time of and after giving effect to the proposed Restricted Payment
(the amount of any such Restricted Payment, if other than cash, as determined by
the Board of Directors, whose determination shall be conclusive and evidenced by
a Board Resolution), (1) no Default or Event of Default shall have occurred and
be continuing, (2) immediately before and immediately after giving effect to
such transaction on a pro forma basis, the Company could incur $1.00 of
additional Indebtedness under the provisions of Section 4.06 of this Indenture
(other than Permitted Indebtedness), and (3) the aggregate amount of all
Restricted Payments declared or made after the date of the Indenture shall not
exceed the sum of:
(A) 50% of the Consolidated Net Income of the Company accrued on a
cumulative basis during the period beginning on the first day of the fiscal
quarter in which the Notes are initially issued and ending on the last day of
the Company's last fiscal quarter ending prior to the date of such proposed
Restricted Payment (or, if such aggregate cumulative Consolidated Net Income
shall be a loss, minus 100% of such loss);
(B) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors of the
Company, whose good faith determination shall be conclusive) received after the
date of the Indenture by the Company as capital contributions to the Company;
(C) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors of the
Company, whose good faith
29
determination shall be conclusive) received after the date of the Indenture by
the Company from the issuance or sale (other than to any Subsidiaries) of shares
of Capital Stock of the Company or any options or warrants to purchase such
shares (other than issuances in respect of clause (ii) of the next paragraph) of
Capital Stock of the Company;
(D) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors of the
Company, whose good faith determination shall be conclusive) received after the
date of the Indenture by the Company (other than from any Subsidiaries) upon the
exercise of any options or warrants to purchase shares of Capital Stock of the
Company;
(E) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors of the
Company, whose good faith determination shall be conclusive) received after the
date of the Indenture, by the Company for debt securities that have been
converted into or exchanged for Qualified Capital Stock of the Company; and
(F) $10 million.
Notwithstanding the foregoing, and in the case of clause (iii) below, so
long as there is no Default or Event of Default continuing, the foregoing
provisions shall not take into account and shall not prohibit:
SEQUENCE LEVEL 5 NUMBERING RESET
(i) the payment of any dividend within 60 days after the date of
declaration if at the date of declaration, such payment would be permitted by
the provisions of the preceding paragraph and such payment shall be deemed to
have been paid on such date of declaration for purposes of the calculation
required by the provisions of the preceding paragraph;
(ii) any redemption, repurchase or other acquisition or retirement of any
shares of any class of Capital Stock of the Company or any Subordinated
Indebtedness in exchange for, or out of the net proceeds of, a substantially
concurrent issue and sale (other than to a Subsidiary) of other shares of
Qualified Capital Stock of the Company, provided that the net proceeds from the
issuance of such shares of Qualified Capital Stock are excluded from clause (C)
of the preceding paragraph; or
(iii) any redemption, repurchase, or other acquisition or retirement of
Subordinated Indebtedness of the Company (other than Redeemable Capital Stock)
made by exchange for, or out of the proceeds of the substantially concurrent
sale of, Subordinated Indebtedness of the Company so long as (A) the principal
amount of such new Indebtedness does not exceed the principal amount of the
Indebtedness being so redeemed, repurchased, acquired or retired (plus the
amount of any premium required to be paid under the terms of the instrument
governing the Indebtedness being so redeemed, repurchased, acquired or retired),
(B) such Indebtedness is subordinated to Senior
30
Indebtedness and the Notes to the same extent as such Subordinated Indebtedness
so purchased, exchanged, redeemed, repurchased, acquired or retired, (C) such
Indebtedness has a Stated Maturity for its final scheduled principal payment
later than the Stated Maturity for the final scheduled principal payment of the
Notes and (D) such Indebtedness has an Average Life to Stated Maturity equal to
or greater than the remaining Average Life to Stated Maturity of the Notes.
Section 4.08. Disposition of Proceeds of Asset Sales.
(a) The Company will not, and will not permit any Subsidiary to, make any
Asset Sale unless (i) at least 85% of the proceeds from such Asset Sale are
received in cash (or, in lieu of cash, (x) a promissory note issued by the
purchaser of the Asset covered by the Asset Sale and secured by a first
perfected security interest in such Asset provided such security interest
remains in full force and perfected until all obligations arising under such
promissory note are paid in full or (y) property or assets to be used by the
Company in a substantially similar manner as the property or asset which was
disposed of in such Asset Sale, as determined by the Board of Directors of the
Company, whose good faith determination shall be conclusive) and (ii) the
Company or such Subsidiary receives consideration at the time of such Asset Sale
at least equal to the Fair Market Value of the shares or assets subject to such
Asset Sale as determined by the Board of Directors and evidenced in a Board
Resolution, whose determination shall be conclusive (including valuation of all
non-cash consideration).
(b) If all or a portion of the Net Cash Proceeds of any Asset Sale are not
required to be applied to repay permanently any outstanding Pari Passu
Indebtedness or any Indebtedness of any Subsidiary as required by the terms
thereof, the Company determines not to apply such Net Cash Proceeds to the
prepayment of Pari Passu Indebtedness or any Indebtedness of any Subsidiary or
if no such Pari Passu Indebtedness or such Indebtedness of any Subsidiary is
outstanding, then the Company may, within one year of the Asset Sale, invest (or
enter into a legally binding agreement to invest) the Net Cash Proceeds in
assets that (as determined by the Board of Directors, whose determination shall
be conclusive and evidenced by a Board Resolution) will be used by the Company
and Wholly Owned Subsidiaries in their marine transportation businesses or in
businesses reasonably related thereto. If any legally binding agreement to
invest any Net Cash Proceeds is terminated, then the Company may invest such Net
Cash Proceeds prior to the end of such one-year period or six months from such
termination, whichever is later, in the business of the Company and Wholly Owned
Subsidiaries as provided above. The amount of such Net Cash Proceeds neither
used to repay or prepay Indebtedness nor used or invested as set forth in the
preceding sentences constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds equals $50 million or
more, the Company shall apply the Excess Proceeds to the repayment of the Notes
as provided in this paragraph (c). The Company shall make an offer to purchase
(an "Offer") from all Holders of the Notes in accordance with the procedures set
forth in this Section 4.08 in the maximum principal amount (expressed as a
multiple of $1,000) of Notes that may be purchased out of the Excess Proceeds
(the "Note Amount"). The offer price shall be
31
payable in cash in an amount equal to 100% of the principal amount of the Notes
plus accrued and unpaid interest, if any, to the date such Offer is consummated
(the "Offered Price"), in accordance with the procedures set forth in this
Section 4.08. To the extent that the aggregate Offered Price tendered pursuant
to an Offer is less than the Note Amount (the amount by which the aggregate
Offered Price is less than the Note Amount constitutes a "Deficiency"), the
Company may use such Deficiency, or a portion thereof, in the business of the
Company and Wholly Owned Subsidiaries. Upon completion of the purchase of all
the Notes tendered pursuant to an Offer, the amount of Excess Proceeds shall be
reset at zero.
(d) If the Company becomes obligated to make an offer pursuant to clause
(c) above, Notes shall be purchased by the Company, at the option of the Holder
thereof, in whole or in part in integral multiples of $1,000, on a date that is
not earlier than 45 days nor later than 60 days from the date the notice is
given to Holders, or such later date as may be necessary for the Company to
comply with the requirements under the Exchange Act. The Offer shall remain open
for a period of 20 Business Days following its commencement or such longer
period as may be required by law. The notice, which shall govern the terms of
the Offer, shall state:
(1) that the Offer is being made pursuant to this Section 4.08 and the
length of time the Offer will remain open;
(2) the purchase price and the Offer Date;
(3) that any Note not tendered or accepted for payment will continue to
accrue interest;
(4) that any Note accepted for payment pursuant to the Offer shall cease
to accrue interest on and after the Offer Date;
(5) that Holders electing to have a Note purchased pursuant to any Offer
will be required to surrender the Note, with the form entitled "Option of Holder
to Elect Purchase" on the reverse of the Note completed, to the Company, a
depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice prior to the close of business on the third Business Day
before the Offer Date in order to collect the purchase price;
(6) that Holders will be entitled to withdraw their election if the Paying
Agent receives, not later than the expiration of the Offer period, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase (including, if any, the
CUSIP number and the certificate number of such Note) and a statement that such
Holder is withdrawing his election to have the Note purchased;
(7) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Excess Proceeds, the Company shall select the Notes to be
purchased on a
32
pro rata basis based upon amounts tendered (with such adjustments as may be
deemed appropriate by the Company so that only Notes in denominations of $1,000,
or integral multiples thereof, shall be purchased); and
(8) that Holders whose Notes were purchased only in part will be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered; provided that each Note purchased and each such new Note issued
shall be in an original principal amount in denominations of $1,000 and integral
multiples thereof.
On or before the Offer Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, Notes or
portions thereof tendered pursuant to the Offer, deposit with the Paying Agent
U.S. legal tender sufficient to pay the purchase price plus accrued interest, if
any, to the Offer Date on the Notes to be purchased and deliver to the Paying
Agent an Officers' Certificate stating that such Notes or portions thereof were
accepted for payment by the Company in accordance with the terms of this Section
4.08. The Paying Agent shall promptly (but in any case not later than 5 days
after the Excess Proceeds payment date) mail or deliver to each tendering Holder
an amount equal to the purchase price of the Note tendered by such Holder and
accepted by the Company for purchase, and the Company shall promptly execute and
issue a new Note, and the Trustee shall promptly authenticate and mail or make
available for delivery such new Note to such Holder equal in principal amount to
any unpurchased portion of the Note surrendered; provided that each such Note
shall be issued in an original principal amount in denominations of $1,000 and
integral multiples thereof. Any Note not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof.
(e) Whenever Excess Proceeds received by the Company equals $50 million or
more, such Excess Proceeds shall, prior to the purchase of Notes described in
paragraph (c) above, be set aside by the Company in a separate account pending
(i) deposit with the depositary of the amount required to purchase the Notes
tendered in an Offer or (ii) delivery by the Company of the Offered Price to the
Holders of the Notes tendered in an Offer. Such Excess Proceeds may be invested
in Temporary Cash Investments the maturity date of which is not later than the
Offer Date. The Company shall be entitled to any interest or dividends accrued,
earned or paid on such Temporary Cash Investments.
(f) In the event that the Company shall be unable to purchase Notes from
Holders thereof in an Offer because of provisions of applicable law, the Company
need not make an Offer. The Company shall then be obligated to (i) invest the
Excess Proceeds in properties and assets to replace the properties and assets
that were the subject of the Asset Sale or in properties and assets that (as
determined by the Board of Directors, whose determination shall be conclusive
and evidenced by a Board Resolution) will be used in the businesses of the
Company and Wholly Owned Subsidiaries existing on the date of the Indenture or
in businesses reasonably related thereto and/or (ii) apply the Excess Proceeds
to repay Pari Passu Indebtedness or Indebtedness of Subsidiaries.
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(g) The Company shall comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and other securities laws or
regulations in connection with the repurchase of the Notes. To the extent that
the provisions of any United States federal or state securities laws and
regulations conflict with this Section 4.08, the Company shall comply with the
applicable United States federal or state securities laws and regulations and
shall not be deemed to have breached its obligations under this Section 4.08 by
virtue thereof.
Section 4.09. Limitation on Transactions with Affiliates.
The Company will not, and will not permit any Subsidiary to, directly or
indirectly (other than pursuant to contractual arrangements in effect on the
date of the Indenture), conduct any business or enter into any transaction or
series of related transactions (including, without limitation, the sale,
purchase, exchange or lease of assets, property or services) with any Affiliate
of the Company (other than a Wholly Owned Subsidiary or a Joint Venture Entity)
unless (i) the terms of such business transaction or series of transactions are
(A) set forth in writing and (B) no less favorable to the Company or such
Subsidiary, as the case may be, than would be obtainable in a comparable
transaction or series of related transactions in arm's-length dealings with an
unrelated third party, and (ii) with respect to a transaction or series of
transactions involving aggregate payments in excess of $1 million, such
transaction or series of transactions has been approved by a majority of the
Independent Directors.
Section 4.10. Limitations on Liens.
The Company will not, and will not permit any Subsidiary to, create,
incur, assume or suffer to exist any Liens of any kind upon any of their
respective assets or properties having an aggregate book value in excess of
$500,000 now owned or acquired after the date of the Indenture or any income or
profits there from to secure any Indebtedness of the Company unless
contemporaneously therewith or prior thereto the Notes are equally and ratably
secured with the obligation or liability secured by such Lien, except for the
Liens set forth on Schedule I hereto and any extension, renewal, refinancing or
replacement, in whole or in part, of any Lien set forth on Schedule I hereto, so
long as (1) the amount of security is not increased thereby, (2) the aggregate
amount of Indebtedness or other obligations secured by the Lien after such
extension, renewal, refinancing or replacement does not exceed the aggregate
amount of the Indebtedness or other obligations secured by the existing Lien
prior to such extension, renewal, refinancing or replacement and (3) the
Indebtedness secured by such Lien (other than Permitted Indebtedness), if any,
is permitted under the provisions of the Indenture.
Section 4.11. Limitations of Guarantees by Subsidiaries.
(a) The Company will not permit any Subsidiary, directly or indirectly, to
assume, guarantee or in any other manner become liable with respect to any
Indebtedness of the
34
Company unless (i) such Subsidiary simultaneously executes and delivers a
supplemental indenture evidencing its guarantee of payment of the Notes, on a
ranking in right of payment at least equal to such assumption, guarantee or
liability (unless such other indebtedness of the Company being guaranteed is
subordinated indebtedness, in which case on a ranking in right of payment prior
to such assumption, guarantee or liability) and (ii) such Subsidiary waives, and
will not in any manner whatsoever claim or take the benefit or advantage of, any
rights of reimbursement, indemnity or subrogation or any other rights against
the Company or any other Subsidiary as a result of any payment by such
Subsidiary under its guarantee.
(b) Each guarantee of the Notes created pursuant to the provisions
described in the foregoing paragraph is referred to as a "Guarantee" and the
issuer of each such Guarantee is referred to as a "Guarantor." Notwithstanding
the foregoing, any Guarantee by a Subsidiary of the Notes shall provide by its
terms that it shall be automatically and unconditionally released and discharged
upon any sale, exchange or transfer, to any Person not an Affiliate of the
Company, of all of the Capital Stock owned by the Company (directly or
indirectly) in, or all or substantially all the assets of, such Subsidiary,
which is in compliance with the Indenture.
Section 4.12. Limitation on Sale-Leaseback Transactions.
The Company shall not, and shall not permit any Subsidiary to, enter into
any sale and leaseback transaction unless (i) the Company or such Subsidiary
could have incurred Indebtedness in an amount equal to the Attributable Debt
relating to such sale and leaseback transaction pursuant to Section 4.06 of this
Indenture or (ii) the proceeds of such sale and leaseback transaction are at
least equal to the fair value (as determined in good faith by the Board of
Directors and evidenced by a Board Resolution) of the property and the Company
or such Subsidiary applies or causes to be applied an amount in cash equal to
the Net Cash Proceeds from such sale to (A) purchase Notes or prepay Pari Passu
Indebtedness or any Indebtedness of any Subsidiary or (B) be used by the Company
and Wholly Owned Subsidiaries in their marine transportation businesses or in
businesses reasonably related thereto, in each case within 90 days of the
effective date of any such sale and leaseback transaction.
Section 4.13. Payments for Consent.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or agreed
to be paid to all Holders of the Notes which so consent, waive or agree to amend
in the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
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Section 4.14. Corporate Existence.
Subject to Article 5 hereof, the Company shall use all reasonable efforts
to preserve and keep in full force and effect (i) its corporate existence, and
the corporate, partnership or other existence of each Subsidiary, in accordance
with the respective organizational documents (as the same may be amended from
time to time) of each Subsidiary and (ii) the rights (charter and statutory),
licenses and franchises of the Company and its 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 of its
Subsidiaries, 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 Subsidiaries, taken as a whole, and that the loss thereof is not adverse in
any material respect to the Holders.
Section 4.15. Change of Control.
(a) If a Change of Control occurs at any time, each Holder of Notes will
have the right to require that the Company repurchase such Holder's Notes at a
purchase price in cash equal to 101% of the principal amount of such Notes plus
accrued and unpaid interest, if any, to the date of purchase, as provided in and
subject to the terms of this Section 4.15. All Notes properly tendered pursuant
to such Change of Control offer and not withdrawn pursuant thereto will be
purchased on the Change of Control payment date. The Change of Control offer
shall remain open for at least 20 Business Days and until the close of business
on the Change of Control payment date.
(b) Within 30 days following any Change of Control, the Company will mail
a notice to each Holder. Such notice shall be sent by first-class mail, postage
prepaid, to the Trustee and to each Holder of the Notes, at the address
appearing in the register maintained by the Registrar of the Notes, and shall
state:
(i) that the Change of Control offer is being made pursuant to this
Section 4.15, the length of time the Change of Control offer will remain open
and that all Notes tendered will be accepted for payment, and otherwise subject
to the terms and conditions set forth herein;
(ii) the Change of Control purchase price and the Change of Control
payment date (which shall be no earlier than 30 days nor later than 60 days from
the date such notice is mailed);
(iii) that any Note not tendered or improperly tendered will continue to
accrue interest;
(iv) that, unless the Company defaults in the payment of the Change of
Control purchase price, any Notes accepted for payment pursuant to the Change of
Control offer shall cease to accrue interest after the Change of Control payment
date;
36
(v) that Holders electing to have their Notes purchased pursuant to a
Change of Control Offer will be required to surrender the Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
payment date in order to collect the purchase price;
(vi) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the Change of
Control payment date, a facsimile transmission or letter setting forth the name
of the Holder, the principal amount of the Notes delivered for purchase
(including, if any, the CUSIP number and the certificate number of such Notes),
and a statement that such Holder is withdrawing his election to have such Notes
purchased;
(vii) that Holders whose Notes are being purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered, provided that each Note purchased and each such new Note
issued shall be in an original principal amount in denominations of $1,000 and
integral multiples thereof;
(viii) any other procedures that a Holder must follow to accept a Change
of Control offer or effect withdrawal of such acceptance;
(ix) the name and address of the Paying Agent; and
(x) the circumstances and relevant facts regarding such Change of Control.
On the Change of Control payment date, the Company shall, to the extent
lawful, (i) accept for payment Notes or portions thereof tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent U.S. legal
tender sufficient to pay the Change of Control purchase price of all Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Paying Agent an Officers' Certificate stating that such Notes or portions
thereof were accepted for purchase by the Company in accordance with the terms
of this Indenture. The Paying Agent shall promptly (but in any case not later
than 5 days after the Change of Control payment date) mail or deliver to each
Holder of Notes so accepted payment in an amount equal to the Change of Control
Purchase Price for such Notes, and the Company shall promptly execute and issue,
and the Trustee shall promptly authenticate and make available for delivery to
such Holder, new Notes equal in principal amount to any unpurchased portion of
the Notes surrendered; provided that each such new Note shall be issued in an
original principal amount in denominations of $1,000 and integral multiples
thereof. Any Note not so accepted shall be promptly mailed or delivered by the
Company to the Holder thereof.
The Company shall comply, to the extent applicable, with the requirements
of Rule 14e-1 under the Exchange Act and other securities laws or regulations in
connection with the repurchase of the Notes as described above. To the extent
that the provisions of any United States federal or state securities laws and
regulations conflict with this Section
37
4.15, the company will company with such applicable securities laws and
regulations and will not be deemed to have breached its obligations under this
Section 4.15 by virtue thereof.
Section 4.16. Maintenance of Office or Agency.
The Company shall maintain an office or agency where Notes may be
presented or surrendered for registration of transfer or exchange or for payment
and where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company shall give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
address of the Trustee as set forth in Section 10.02 and the Company hereby
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations. The Company shall
give prompt written notice to the Trustee of such designation or rescission and
of any change in the location of any such other office or agency.
The Company hereby initially designates the Corporate Trust Office of the
Trustee set forth in Section 10.02 as such office of the Company.
Section 4.17. Restrictions on Preferred Stock of Subsidiaries.
The Company will not permit any Subsidiary to issue any Preferred Stock
(other than to the Company or a Wholly Owned Subsidiary), or permit any Person
(other than the Company or a Wholly Owned Subsidiary) to own any Preferred Stock
of any Subsidiary.
Section 4.18. Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries.
The Company will not, and will not permit any Subsidiary to, create or
otherwise cause to become effective any consensual encumbrance or restriction of
any kind, on the ability of any Subsidiary to (a) pay dividends or make any
other distribution on its Capital Stock, (b) pay any Indebtedness owed to the
Company or any other Subsidiary, (c) make any Investment in the Company or any
other Subsidiary or (d) transfer any of its property or assets to the Company or
any other Subsidiary, except (i) any encumbrance or restriction pursuant to an
agreement in effect at or entered into on the date of the Indenture; (ii) any
encumbrance or restriction pursuant to Title XI Financing provided
38
that such encumbrance or restriction is no more onerous to the Company or such
Subsidiary than any provision contained in any agreement or other document
pertaining to a Title XI Financing to which the Company or such Subsidiary is a
party or subject which is outstanding on the date of the Indenture; (iii) any
encumbrance or restriction, with respect to a Subsidiary that is not a
Subsidiary on the date of the Indenture, in existence at the time such Person
becomes a Subsidiary or created on the date it becomes a Subsidiary and not
incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary; and (iv) any encumbrance or restriction existing under any agreement
that extends, renews, refinances or replaces the agreements containing the
restrictions in the foregoing clauses (i), (ii), and (iii) provided, that the
terms and conditions of any such restrictions are not materially less favorable
to the Holders of the Notes than those under or pursuant to the agreement
evidencing the Indebtedness so extended, renewed, refinanced or replaced (in the
opinion of the Board of Directors of the Company and evidenced in a Board
Resolution whose determination shall be conclusive).
Section 4.19. Limitations on Unrestricted Subsidiaries.
The Company will not make, and will not permit any Subsidiaries to make,
any Investments in Unrestricted Subsidiaries if, at the time thereof, (i) the
aggregate amount of such Investments would exceed the sum of (x) 10% of the
Company's Consolidated Net Tangible Assets at the time of determination and (y)
the amount of Restricted Payments then permitted to be made pursuant to Section
4.07 of this Indenture and (ii) after giving effect to such Investment, the
Company could not incur $1.00 of additional Indebtedness (other than Permitted
Indebtedness). Any Investments in Unrestricted Subsidiaries permitted to be made
pursuant to this covenant may be made in cash or property.
Section 4.20. Insurance.
The Company shall maintain, and shall cause its Subsidiaries to maintain,
insurance with responsible carriers (which shall include the Company's
wholly-owned subsidiary, Bay Insurance Company, a Bermuda company), against such
risks and in such amounts, and with such deductibles, retentions, self- insured
amounts and co-insurance provisions, as are customarily carried by similar
businesses of similar size, including property and casualty loss, workers
compensation and interruption of business insurance.
39
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation, Merger and Sale of Assets.
The Company shall not, in a single transaction or through a series of
related transactions, consolidate or merge with or into any other Person or
sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets as an entirety to any other
Person or group of affiliated Persons or permit any Subsidiaries to enter into
any such transaction or transactions if such transaction or transactions, in the
aggregate, would result in a sale, assignment, transfer, lease or disposal of
all or substantially all of the properties and assets of the Company and
Subsidiaries on a Consolidated basis to any other Person or group of affiliated
Persons, or permit any Person to consolidate or merge with or into the Company
unless at the time and after giving effect thereto (i) either (a) the Company
shall be the continuing Person, or (b) the Person (if other than the Company)
formed by such consolidation or into which the Company is merged or to which all
or substantially all of the properties and assets of the Company, substantially
as an entirety, are transferred (the "Surviving Entity") shall be a corporation,
partnership or trust organized and validly existing under the laws of the United
States of America, or any state thereof or the District of Columbia, and shall
expressly assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form reasonably satisfactory to the Trustee, the due and
punctual payment of the principal of, premium, if any, and interest on all of
the Notes and the performance and observance of every covenant of the Indenture
on the part of the Company to be performed or observed, and the Indenture shall
remain in full force and effect; (ii) immediately before and immediately after
giving effect to such transaction on a pro forma basis (and treating any
Indebtedness not previously an obligation of the Company or a Subsidiary which
becomes the obligation of the Company or any Subsidiary in connection with or as
a result of such transaction as having been incurred at the time of such
transaction), no Default or Event of Default shall have occurred and be
continuing and the Company (or the Surviving Entity if the Company is not the
continuing obligor under the Indenture), after giving effect to such
transaction, could incur $1.00 of additional Indebtedness (other than Permitted
Indebtedness) under Section 4.06 of this Indenture; (iii) immediately after
giving effect to such transaction on a pro forma basis (and treating any
Indebtedness not previously an obligation of the Company or a Subsidiary which
becomes the obligation of the Company or any Subsidiary in connection with or as
a result of such transaction as having been incurred at the time of such
transaction), the Consolidated Net Worth of the Company (or the Surviving Entity
if the Company is not the continuing obligor under the Indenture) is at least
equal to the Consolidated Net Worth of the Company immediately before such
transaction; and (iv) each Guarantor, if any, unless it is the other party to
the transactions described above, shall have by supplemental indenture or
guarantee confirmed that its Guarantee shall apply to such Person's obligations
under the Indenture and the Notes.
40
In connection with any consolidation, merger, transfer or lease
contemplated hereby, the Company or such Person shall deliver, or cause to be
delivered, to the Trustee, in the form and substance reasonably satisfactory to
the Trustee, an Officer's Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale, assignment, transfer, lease or
disposition and the supplemental indenture in respect thereto comply with the
requirements under the Indenture.
A Guarantor, if any (other than any Subsidiary whose Guarantee is being
released as described in Section 4.11 of this Indenture as a result of such
transaction), shall not, and the Company will not permit a Guarantor, in a
single transaction or through a series of related transactions, to consolidate
with or merge with or into any other Person, or sell, assign, convey, transfer,
lease or otherwise dispose of all or substantially all of its properties and
assets on a Consolidated basis substantially as an entirety to any other Person
or group of affiliated Persons unless (i) either (1) such Guarantor shall be the
continuing corporation, partnership or trust or (2) the entity (if other than
such Guarantor) formed by such consolidation or into which such Guarantor is
merged or the Person which acquires by sale, assignment, conveyance, transfer,
lease or disposition the properties and assets of such Guarantor substantially
as an entirety (the "Transaction Survivor") shall be a corporation, partnership
or trust organized and validly existing under (x) the laws of the United States,
any state thereof or the District of Columbia or (y) the laws of any other
country recognized by the United States of America and, in either case, shall
expressly assume by a supplemental indenture or guarantee, executed and
delivered to the Trustee, in form reasonably satisfactory to the Trustee, all
the obligations of such Guarantor under the Notes and the Indenture; (ii)
immediately after giving effect to such transaction (and treating any
Indebtedness not previously an obligation of such Guarantor or a subsidiary
thereof which becomes the obligation of such Guarantor or any of its
subsidiaries in connection with or as a result of the transaction as having been
incurred at the time of the transaction), no Default or Event of Default shall
have occurred and be continuing; (iii) the Transaction Survivor shall have
delivered to the Trustee opinions of independent counsel to the effect that (a)
the Holders of the outstanding Notes will not recognize United States federal
income, gain or loss for income tax or other tax purposes as a result of such
transaction, and will be subject to United States federal income tax and other
tax on the same amounts, in the same manner and at the same times as would be
the case if such transaction had not occurred and (b) there will be no
withholding tax imposed on any payments made pursuant to the Notes or the
Guarantees by the jurisdiction in which the Transaction Survivor is domiciled or
incorporated; provided that the Holders of Notes file any forms with the
relevant governments which the Company reasonably requests such Holders to file,
which filings will have no other material economic or legal consequences to such
Holders; and (iv) such Guarantor shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, sale, assignment, conveyance, transfer, lease or
disposition and such supplemental indenture comply with the Indenture, and that
all conditions precedent therein relating to such transaction have been complied
with.
41
Notwithstanding the foregoing, any Subsidiary may (x) merge or consolidate
with or into any other Wholly Owned Subsidiary or the Company or (y) sell,
assign, convey, transfer, lease, or otherwise dispose of all or substantially
all of its properties and assets to any other Wholly Owned Subsidiary or the
Company; provided that (A) any Person surviving any such merger or consolidation
with a Guarantor or which acquires substantially all of the assets of any
Guarantor (the "Acquisition Survivor") shall expressly assume by a supplemental
indenture or guarantee executed and delivered to the Trustee, in form and
substance reasonably satisfactory to the Trustee, any obligations of such
Subsidiary to guarantee the obligations owing under this Indenture; and (B) the
Acquisition Survivor shall have delivered to the Trustee an officers'
certificate and an opinion of counsel, each stating that the transaction and the
supplemental guarantee or indenture executed in connection therewith comply with
this Article and that all conditions precedent herein provided for relating to
such transaction have been complied with.
In the event of any transaction (other than a lease) described in and
complying with the conditions listed in the immediately preceding paragraphs in
which the Company or any Guarantor is not the continuing corporation, the
successor Person formed or remaining shall succeed to, and be substituted for,
and may exercise every right and power of, the Company or such Guarantor, as the
case may be, with the same effect as if such successor Person had been named as
the Company under the Indenture or such Guarantor under the Guarantee, as the
case may be.
Section 5.02. Successor Person Substituted.
Upon any consolidation, merger, conveyance or any transfer of all or
substantially all of the assets of the Company or any Guarantor, if any, in
accordance with Section 5.01 of this Indenture, the successor Person formed by
such consolidation or into which the Company or any Guarantor, if any, is merged
or to which such transfer is made shall succeed to, and be substituted for, and
may exercise every right and power of, the Company or any Guarantor, if any,
under this Indenture, the Notes and/or the Guarantees, as the case may be, with
the same effect as if such successor Person had been named as the Company herein
or such Guarantor under the Guarantee, and thereafter the predecessor
corporation shall be relieved of all obligations and covenants under this
Indenture, the Notes and/or the Guarantees, as the case may be.
42
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(i) there shall be a failure to pay an installment of interest on any of
the Notes when it becomes due and payable and continuance of such default for a
period of 30 days after the date when due;
(ii) there shall be a failure to pay when due the principal of (at its
Stated Maturity, required repurchase or otherwise) or premium, if any, on any of
the Notes;
(iii) the Company or any Guarantor, if any, shall fail to comply with its
obligations under Section 5.01 of this Indenture;
(iv) (A) the Company shall fail to perform or observe any other covenant,
warranty or agreement contained in the Notes or the Indenture (other than a
default in the performance or breach of a covenant, warranty or agreement which
is expressly dealt with elsewhere herein) for a period of 30 days after written
notice of such failure, requiring the Company to remedy the same, shall have
been given (x) to the Company by the Trustee or (y) to the Company and the
Trustee by the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding; or (B) the Company shall have failed to make or
consummate an offer in accordance with the provisions of Sections 4.08 or 4.15
of this Indenture;
(v) (A) a default in the payment of the principal, premium, if any, or
interest on any Indebtedness shall have occurred under any agreements,
indentures or instruments under which the Company or any Significant Subsidiary
then has outstanding Indebtedness in excess of $5 million when the same shall
become due and payable and continuation of such default after any applicable
grace period or (B) an event of default as defined in any of the foregoing
agreements, indentures or instruments shall have occurred and the Indebtedness
thereunder, if not already matured at its final maturity in accordance with its
terms, shall have been accelerated;
(vi) any Guarantee, if any, is determined by a court of competent
jurisdiction to be null and void or the Guarantor, if any, denies that it has
any further liability under the Guarantee, or gives notice to such effect (other
than by reason of the release of any such Guarantee in accordance with Section
4.11 of this Indenture);
(vii) one or more judgments, orders or decrees for the payment of money in
excess of $5 million, either individually or in the aggregate, shall be entered
against the Company or any Significant Subsidiary or any of their respective
properties which is not
43
fully covered by insurance, bond or surety or similar instrument and shall not
be discharged and either (a) any creditor shall have commenced an enforcement
proceeding upon such judgment, order or decree or (b) there shall have been a
period of 60 days during which a stay of enforcement of such judgment, order or
decree, by reason of an appeal or otherwise, shall not be in effect; or
(viii) 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, or
(E) generally is not able to pay its debts as they become due; or
(ix) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against the Company or any Significant Subsidiary
in an involuntary case,
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for 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 the order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator, custodian or similar official under any
Bankruptcy Law.
The Trustee may withhold notice as provided under Section 7.05 to the
Holders of the Notes of any Default (except in payment of principal or premium,
if any, or interest on the Notes) if the Trustee considers it to be in the
interests of the Holders of the Notes to do so.
Section 6.02. Acceleration.
(a) If an Event of Default (other than an Event of Default arising
under Section 6.01(viii) or (ix)) shall occur and be continuing, the Trustee or
the Holders of not less
44
than 25% in aggregate principal amount of the Notes then outstanding may declare
the principal of all the Notes to be due and payable immediately at their
principal amount together with accrued and unpaid interest to the date the Notes
become due and payable and thereupon the Trustee may, at its discretion, proceed
to protect and enforce the rights of the Holders of Notes by appropriate
judicial proceeding. If an Event of Default specified in Section 6.01(viii) or
(ix) occurs and is continuing, then the principal of all the Notes shall ipso
facto become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Holder.
(b) Notwithstanding the provisions of Section 6.04 of this Indenture,
after a declaration of acceleration, but before a judgment or decree for payment
of the money due has been obtained by the Trustee, the Holders of a majority in
aggregate principal amount of Notes outstanding, by written notice to the
Company and the Trustee, may rescind and annul such declaration if (a) the
Company has paid or deposited with the Trustee a sum sufficient to pay (i) all
sums paid or advanced by the Trustee under the Indenture and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, (ii) all overdue interest on all Notes, (iii) the principal of and
premium, if any, on any Notes which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate borne by the Notes,
and (iv) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate borne by the Notes; and (b) all Events of Default,
other than the nonpayment of principal of the Notes which have become due solely
by such declaration of acceleration, have been cured or waived.
(c) The Company is required to notify the Trustee within five business
days of the occurrence of any Default.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of, or premium, if any, and interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture and may take any
necessary action requested of it as Trustee to settle, compromise, adjust or
otherwise conclude any proceedings to which it is a party.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Noteholder in exercising any right or remedy accruing upon
an Event of Default shall not impair the right or remedy or constitute a waiver
of or acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative to the extent permitted by law.
45
Section 6.04. Waiver of Past Defaults and Events of Default.
Subject to Sections 6.02, 6.07 and 8.02 hereof, the Holders of not less
than a majority in aggregate principal amount of the Notes outstanding may on
behalf of the Holders of all the Notes waive any past Default under the
Indenture and its consequences, except a Default in the payment of the principal
of, premium, if any, or interest on any Note, or in respect of a covenant or
provision which under the Indenture cannot be modified or amended without the
consent of the Holder of each Note outstanding. Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereto.
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the outstanding Notes
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee by this Indenture. The Trustee, however, may refuse to
follow any direction that conflicts with any laws or regulations or this
Indenture or that the Trustee determines may be unduly prejudicial to the rights
of another Noteholder not taking part in such direction, and the Trustee shall
have the right to decline to follow any such direction if the Trustee, being
advised by counsel, determines that the action so directed may not lawfully be
taken or if the Trustee in good faith shall, by a Trust Officer, determine that
the proceedings so directed may involve it in personal liability; provided that
the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. Prior to taking any action hereunder, the
Trustee shall be entitled to indemnification or security satisfactory to it in
its reasonable discretion against all losses, liabilities, expenses or fees
caused by taking or not taking such action.
Section 6.06. Limitation on Suits.
Subject to Section 6.07 of this Indenture, no Holder has any right to
institute any proceeding with respect to this Indenture or pursue any remedy
thereunder unless:
(1) the Holders of at least 25% in aggregate principal amount of the
outstanding Notes make a written request to the Trustee to institute such
proceeding or pursue the remedy as Trustee;
(2) such Holder or Holders offer to the Trustee indemnity reasonably
satisfactory to the Trustee against any loss, liability, expense or fee;
(3) the Trustee fails to institute such proceeding or pursue such remedy
within 15 calendar days after receipt of such notice and the indemnity; and
46
(4) the Trustee has not received directions inconsistent with such written
request during such 15-day period by the Holders of a majority in aggregate
principal amount of the outstanding Notes.
A Noteholder may not use this Indenture to prejudice the rights of another
Noteholder or to obtain a preference or priority over another Noteholder.
Section 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal of, or premium, if any, or
accrued interest, if any, on any Note held by such Holder on or after the
respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates, is absolute
and unconditional and shall not be impaired or affected without the consent of
the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, premium or interest
specified in clauses (i), (ii) or (iii) of Section 6.01 of this Indenture occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of unpaid
principal and accrued interest remaining unpaid, together with interest on
overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate then
borne by the Notes, and such further amounts as shall be sufficient to cover the
reasonable costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and the Noteholders allowed
in any judicial proceedings relative to the Company (or any other obligor upon
the Notes), its creditors or its property and shall be entitled and empowered to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same after deduction of its charges and
expenses to the extent that any such charges and expenses are not paid out of
the estate in any such proceedings and any custodian in any such judicial
proceeding is hereby authorized by each Noteholder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Noteholders, to pay to the Trustee any amount due to it
for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof.
47
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
or reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceedings.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 hereof;
SECOND: to Noteholders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest as to each, ratably, without preference
or priority of any kind, according to the amounts due and payable on the Notes
upon presentation of the Notes and the notation thereon of the payment if only
partially paid and upon surrender thereon if fully paid;
THIRD: the balance, if any, to the Person or Persons entitled thereto; and
FOURTH: to the Company.
The Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
All parties to this Indenture agree and each Holder of any Note by his
acceptance thereof shall be deemed to have agreed that in any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section 6.11 does not apply
to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 hereof or
a suit by a Holder or Holders of more than 10% in aggregate principal amount of
the Notes then outstanding.
48
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default known to the Trustee has occurred and is
continuing, the Trustee shall, other than with respect to any action taken by
the Trustee as directed by a majority in aggregate principal amount of the
Holders of out standing Notes, exercise such rights and powers vested in it by
this Indenture and use the same degree of care and skill in their exercise as a
prudent Person would exercise or use under the circumstances in the conduct of
such Person's own affairs.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(1) The Trustee need perform only those duties that are specifically set
forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture but, in the case of any such
certificates or opinions which by any provision hereof are specifically required
to be furnished to the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(2) The Trustee shall not be liable for any error of judgment made in good
faith by a Trust Officer, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes or
omits to take in good faith in accordance with a direction received by it
pursuant to Sections 6.02, 6.04 and 6.05 hereof.
(4) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its rights or powers if it determines in the exercise of its
reasonable discretion that repayment of such funds or adequate indemnity
satisfactory to it against such risk or liability is not reasonably assured to
it.
49
(d) Whether or not therein expressly so provided, paragraphs (a), (b) and
(c) of this Section 7.01 shall govern every provision of this Indenture that in
any way relates to the Trustee.
(e) The Trustee is not under any obligation to exercise any of its rights
or powers under this Indenture at the request or direction of any of the Holders
unless such Holders shall have offered to the Trustee indemnity or security
satisfactory to it in its reasonable discretion against any loss, liability,
expense or fee.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by the law.
Section 7.02. Rights of Trustee.
Subject to Section 7.01 hereof:
(1) In the absence of bad faith on its part, the Trustee may rely on any
document reasonably believed by it to be genuine and to have been signed or
presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document.
(2) Before the Trustee acts or refrains from acting with respect to any
matters contemplated by this Indenture or the Notes it may require an Officers'
Certificate or an Opinion of Counsel, or both, which shall conform to the
provisions of Section 10.05 hereof. The Trustee shall be protected and shall not
be liable for any action it takes or omits to take in good faith in reliance on
such certificate or opinion.
(3) In the absence of bad faith on its part, the Trustee may act through
Agents and shall not be responsible for the misconduct or negligence of any
Agent unless the appointment of such Agent was made with negligence.
(4) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it reason ably believes to be authorized or within its
rights or powers under this Indenture.
(5) The Trustee may consult with counsel of its selection, and the advice
or opinion of such counsel as to matters of law shall be full and complete
authorization and protection from liability in respect of any action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the Company, or any Affiliates thereof, with
the same rights it would
50
have if it were not Trustee. Any Agent may do the same with like rights. The
Trustee, however, shall be subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the sale of Notes or any
money paid to the Company pursuant to the terms of this Indenture and it shall
not be responsible for any statement in the Notes other than its certificate of
authentication.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to the Trustee,
the Trustee shall mail to each Noteholder notice of the Default within 30 days
after it occurs. Except in the case of a Default in payment of the principal of,
or premium, if any, or interest on any Note the Trustee may with hold the notice
if and so long as the board of directors of the Trustee, the executive committee
or any trust committee of such board and/or its Trust Officers in good faith
determine(s) that withholding the notice is in the interests of the Noteholders.
Section 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after May 15 of any
year, commencing on May 15 following the date of this Indenture, the Trustee
shall mail to each Noteholder a brief report dated as of such May 15 that
complies with TIA Section 313(a). The Trustee also shall comply with the
reporting requirements of TIA Section 313(b)(2). The Trustee shall transmit all
such reports by mail as required by TIA Section 313(c):
(1) to all registered Holders of Notes, as the names and addresses of such
Holders appear on the Registrar's books; and
(2) to such Holder of Notes as have, within the two years preceding such
transmission, filed their names and addresses with the Trustee for that purpose.
A copy of each such report at the time of such mailing to Noteholders
shall be filed with the Commission and each stock exchange on which the Notes
are listed as provided by TIA Section 313(d). The Company shall promptly notify
the Trustee when the Notes are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such compensation
as shall be agreed in writing between the Company and the Trustee for its
services hereunder (which compensation shall not be limited by any provision of
law in
51
regard to the compensation of a trustee of an express trust). The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it in connection with its duties under this
Indenture, including the reasonable compensation, disbursements and expenses of
the Trustee's agents and counsel and except for any such disbursement or expense
as may be attributable to negligence or bad faith.
The Company shall indemnify each of the Trustee and its officers,
directors, employees and agents and any predecessor Trustee and its officers,
directors, employees and agents for, and hold it harmless against, any and all
loss, damage, claim, liability or reasonable expense, including taxes (other
than taxes based on the income of the Trustee) incurred by it in connection with
the acceptance or performance of its duties under this Indenture including the
reasonable costs and expenses of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder (including, without limitation, settlement costs). The Trustee shall
notify the Company in writing promptly of any claim asserted against the Trustee
for which it may seek indemnity. However, the failure by the Trustee to so
notify the Company shall not relieve the Company of its obligations hereunder
except to the extent the Company is prejudiced thereby.
Notwithstanding the foregoing, the Company need not reimburse the Trustee
for any expense or indemnify it against any loss, damage, claim or liability
incurred by the Trustee through its negligence or bad faith. To secure the
payment obligations of the Company in this Section 7.07, the Trustee shall have
a lien prior to the Notes on all money or property held or collected by the
Trustee except such money or property held in trust to pay principal of and
interest on particular Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in of Section 6.01(viii) or (ix) of this Indenture occurs, the
expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.
For purposes of this Section 7.07, the term "Trustee" shall include any
trustee appointed pursuant to Article 9.
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company in writing. The Holders
of a majority in principal amount of the outstanding Notes may remove the
Trustee by notifying the removed Trustee in writing and may appoint a successor
Trustee with the Company's written consent which consent shall not be
unreasonably withheld. The Company may remove the Trustee at its election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
52
(3) a receiver or other public officer takes charge or control of the
Trustee or its property or affairs; or
(4) the Trustee otherwise 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.
No resignation or removal of the Trustee shall become effective until the
acceptance of appointment by the successor Trustee. 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 a majority in principal
amount of the outstanding Notes may petition any court of competent jurisdiction
for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any Noteholder
who has been a bona fide Holder for at least 6 months may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee if the Trustee fails after written request thereof by such
Noteholder to comply with Section 7.10.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Immediately following such delivery,
the resignation or removal of the retiring Trustee shall become effective and
the retiring Trustee shall, subject to its rights under Section 7.07 hereof,
transfer all property held by it as Trustee to the successor Trustee, 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. A successor Trustee shall mail notice of its succession to
each Noteholder. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 hereof shall continue
for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust assets to, another corporation,
subject to Section 7.10 hereof, the successor corporation without any further
act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirements
of TIA Section 310(a)(1) and (2) in every respect. The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report
53
of condition. The Trustee shall comply with TIA Section 310(b), including the
provision in Section 310(b)(1). The provisions of TIA Section 310(a)(5) shall
apply to any Person directly or indirectly controlling, controlled by or under
common control with the Company as obligor of the Notes. The provisions of TIA
Section 310 shall apply to the Company as obligor of the Notes.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
The provisions of TIA Section 311 shall apply to the Company as obligor of the
Notes.
Section 7.12. Paying Agents.
The Company shall cause each Paying Agent other than the Trustee to
execute and deliver to it and the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 7.12:
(A) that it will hold all sums held by it as agent for the payment of
principal of, or premium, if any, or interest on, the Notes (whether such sums
have been paid to it by the Company or by any obligor on the Notes) in trust for
the benefit of Holders of the Notes or the Trustee;
(B) that it will at any time during the continuance of any Event of
Default, upon written request from the Trustee, deliver to the Trustee all sums
so held in trust by it together with a full accounting thereof; and
(C) that it will give the Trustee written notice within three (3) Business
Days of any failure of the Company (or by any obligor on the Notes) in the
payment of any installment of the principal of, premium, if any, or interest on,
the Notes when the same shall be due and payable.
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
The Company and the Guarantors, if any, when authorized by a Board
Resolution, and the Trustee may amend, waive or supplement this Indenture or the
Notes without notice to or consent of any Noteholder:
54
(1) to comply with Section 5.01 hereof;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(3) to comply with any requirements of the Commission under the TIA and
maintain the qualification of this Indenture under the TIA;
(4) to cure any ambiguity, defect or inconsistency, or to make any other
change that does not adversely affect the rights of any Noteholder;
(5) to add to the covenants of the Company for the benefit of the Holders
or to surrender any right or power herein upon the Company;
(6) to add a Guarantor pursuant to the requirements of Section 4.11;
(7) to evidence and provide the acceptance of the appointment of a
successor Trustee hereunder;
(8) to secure the Notes pursuant to the requirements of Section 4.10 or
otherwise; or
(9) to mortgage, pledge, hypothecate or grant a security interest in favor
of the Trustee for the benefit of the Holders as additional security for the
payment and performance of the Indenture Obligations, in any property or assets,
including any which are required to be mortgaged, pledged or hypothecated, or in
which a security interest is required to be granted to the Trustee, pursuant to
this Indenture or otherwise.
The Trustee is hereby authorized to join with the Company and the
Guarantors, if any, in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the Trustee
shall not be obligated to enter into any such supplemental indenture which
adversely affects its own rights, duties or immunities under this Indenture.
Section 8.02. With Consent of Holders.
The Company and the Guarantors, if any, and the Trustee may modify or
supplement this Indenture, the Notes or the Guarantees, if any, with the written
consent of the Holders of not less than a majority in aggregate principal amount
of the outstanding Notes without notice to any Noteholder. The Holders of not
less than a majority in aggregate principal amount of the outstanding Notes may
waive compliance in a particular instance by the Company or the Guarantors, if
any, with any provision of this Indenture or the Notes without notice to any
Noteholder. Subject to Section 8.04, without the consent of each Noteholder
affected, however, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:
55
(i) change the Stated Maturity of the principal of, or any installment of
interest on, any Note or reduce the principal amount thereof or the rate of
interest thereon or change the currency in which any Note or any premium or the
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment after the Stated Maturity thereof;
(ii) amend, change or modify the definition of "Change of Control" or the
obligation of the Company to make and consummate an offer to purchase the Notes
upon a Change of Control on the terms described in Section 4.15 of this
Indenture;
(iii) reduce the percentage in principal amount of the outstanding Notes,
the consent of whose Holders is required for any such supplemental indenture or
the consent of whose holders is required for any waiver of compliance with
certain provisions of the Indenture or certain Defaults thereunder and their
consequences provided for in the Indenture or with respect to any Guarantee;
(iv) modify any of the provisions relating to supplemental indentures
requiring the consent of holders or relating to the waiver of past defaults or
relating to the waiver of certain covenants, except to increase any such
percentage of outstanding Notes required for such actions or to provide that
certain other provisions of the Indenture cannot be modified or waived without
the consent of the holder of each Note affected thereby; or
(v) except as otherwise permitted under Section 5.01 of this Indenture,
consent to the assignment or transfer by the Company or any Guarantor of any of
its rights and obligations under this Indenture.
After an amendment, supplement or waiver under this Section 8.02 becomes
effective, the Company shall mail to the Holders a notice briefly describing the
amendment, supplement or waiver.
Upon the request of the Company and each Guarantor, if any, accompanied by
a copy of a Board Resolution authorizing the execution of any such supplemental
indenture or Guarantee, and upon the receipt by the Trustee of evidence
reasonably satisfactory to the Trustee of the consent of the Noteholders as
aforesaid and upon receipt by the Trustee of the documents described in Section
8.06 hereof, the Trustee shall join with the Company and each Guarantor in the
execution of such supplemental indenture or Guarantee unless such supplemental
indenture or Guarantee affects the Trustee's own rights, duties or immunities
under this Indenture, in which case the Trustee may in its discretion, but shall
not be obligated to, enter into such 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, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
56
Section 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Notes shall
comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
Until an amendment, supplement, waiver or other action becomes effective,
a consent to it by a Holder of a Note is a continuing consent conclusive and
binding upon such Holder and every subsequent Holder of the same Note or portion
thereof, and of any Note issued upon the transfer thereof or in exchange therefo
or in place thereof, even if notation of the consent is not made on any such
Note. Any such Holder or subsequent Holder, however, may revoke the consent as
to his Note or portion of a Note, if the Trustee receives the notice of
revocation before the date the amendment, supplement, waiver or other action
becomes effective.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement, or waiver. If a record date is fixed, then, such record date shall
be not less than 20 days prior to the first solicitation of such consent, and
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such amendment, supplement, or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 120 days after such record date unless the consent of the requisite number
of Holders has been obtained.
After an amendment, supplement, waiver or other action becomes effective,
it shall bind every Noteholder, unless it makes a change described in any of
clauses (i) through (v) of Section 8.02 hereof. In that case the amendment,
supplement, waiver or other action shall bind each Holder of a Note who has
consented to it and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the consenting Holder's Note.
Section 8.05. Notation on or Exchange of Notes.
If an amendment, supplement, or waiver changes the terms of a Note, the
Trustee may request the Holder of the Note to deliver it to the Trustee. In such
case, the Trustee shall place an appropriate notation on the Note about the
changed terms and return it to the Holder. Alternatively, if the Company or the
Trustee so determines, the Company in exchange for the Note shall execute and
issue and the Trustee shall authenticate a new Note that reflects the changed
terms. Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
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Section 8.06. Trustee To Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article 8 if the amendment, supplement or waiver 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 or refusing to
sign such amendment, supplement or waiver the Trustee shall be entitled to
receive and, subject to Section 7.01 hereof, shall be fully protected in relying
upon an Officers' Certificate and an Opinion of Counsel stating that such
amendment, supplement or waiver is authorized or permitted by this Indenture.
The Company may not sign an amendment or supplement until the Board of Directors
of the Company approves it.
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture.
This Indenture will cease to be of further effect (except as to surviving
rights of registration of transfer or exchange of the Notes, as expressly
provided for in this Indenture) as to all outstanding Notes when (i) either (a)
all the Notes theretofore authenticated and delivered (except lost, stolen or
destroyed Notes which have been replaced or paid) have been delivered to the
Trustee for cancellation or (b) all Notes not theretofore delivered to the
Trustee for cancellation have become due and payable and the Company or any of
the Guarantors has irrevocably deposited or caused to be deposited with the
Trustee funds in an amount sufficient to pay and discharge the entire
indebtedness on the Notes not theretofore delivered to the Trustee for
cancellation, for the principal of, premium, if any, and interest to the date of
such deposit; (ii) the Company or any of the Guarantors has paid all other sums
payable under this Indenture by the Company and the Guarantors, if any; and
(iii) the Company and each of the Guarantors, if any, have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel each stating that all
conditions precedent under this Indenture relating to the satisfaction and
discharge of this Indenture have been complied with.
Section 9.02. Defeasance.
The Company may, at its option and at any time, elect by Board Resolution
to have the obligations of the Company discharged with respect to the
outstanding Notes ("Defeasance"). Such Defeasance means that the Company shall
be deemed to have paid and discharged the entire indebtedness represented by the
outstanding Notes and to have satisfied all its other obligations under the
outstanding Notes and this Indenture insofar as such outstanding Notes are
concerned (and the Trustee, at the expense of the Company, shall, subject to
Section 9.06 hereof, execute proper instruments acknowledging the same), except
for the following which shall survive until otherwise terminated or
58
discharged hereunder: (i) the rights of the Holders of outstanding Notes to
receive solely from the trust funds described in Section 9.04 of this Indenture
and as more fully set forth in such Section, payments in respect of the
principal of, premium, if any, and interest of such Notes when such payments are
due, (ii) the Company's obligations with respect to the Notes under Article 2
and Section 4.16 of this Indenture, (iii) the rights, powers, trusts, duties and
immunities of the Trustee hereunder (including claims of, or payments to, the
Trustee under or pursuant to Section 7.07 of this Indenture), and (iv) Article 9
of this Indenture.
Section 9.03. Covenant Defeasance.
The Company may, at its option at any time, elect by Board Resolution to
have the obligations of the Company and any Guarantor, if any, released with
respect to their respective obligations under Sections 4.02 through 4.12, 4.15,
and 4.17 through 4.20 of this Indenture and clauses (ii) and (iii) of Section
5.01 of this Indenture with respect to the outstanding Notes on and after the
date the conditions in Section 9.04 of this Indenture are satisfied ("Covenant
Defeasance") and any omission to comply with such obligations shall not
constitute a Default or an Event of Default with respect to the Notes. In the
event Covenant Defeasance occurs, certain events (not including non-payment,
bankruptcy and insolvency events) described under Section 6.01 of this Indenture
will no longer constitute a Default or an Event of Default with respect to the
Notes.
Section 9.04. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of Section 9.02 or
Section 9.03 hereof to the outstanding Notes:
(i) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders of the Notes, cash in United States dollars, U.S.
Government Obligations, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Notes on the Stated Maturity of such principal or installment of
principal or interest;
(ii) in the case of Defeasance, the Company shall have delivered to the
Trustee an opinion of independent counsel in the United States stating that (A)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of the Indenture, there has been
a change in the applicable federal income tax law or the judicial interpretation
thereof, in either case to the effect that, and based thereon such opinion of
counsel shall confirm that, the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result of
such 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;
59
(iii) in the case of Covenant Defeasance, the Company shall have delivered
to the Trustee an opinion of independent counsel in the United States to the
effect that the Holders of the outstanding Notes will not recognize income, gain
or loss for federal income tax purposes as a result of such covenant defeasance
and will be subject to 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;
(iv) no Default or Event of Default shall have occurred and be continuing
on the date of such deposit;
(v) such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a Default under, the Indenture or any other material
agreement or instrument to which the Company or any Guarantor, if any, is a
party or by which it is bound;
(vi) in the case of Defeasance or Covenant Defeasance, the Company shall
have delivered to the Trustee an opinion of independent counsel to the effect
that (A) the trust funds will not be subject to any rights of holders of any
Indebtedness of the Company, including, without limitation, those arising under
the Indenture (other than the rights of the Holders of the Notes to receive the
principal of, and interest on, the Notes) and (B) after the 91st day following
the deposit, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors
rights generally;
(vii) no event or condition shall exist that would prevent the Company
from making payments of the principal of, premium, if any, and interest on the
Notes on the date of such deposit or at any time ending on the 91st day after
the date of such deposit; and
(viii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Defeasance or the Covenant
Defeasance, as the case may be, have been complied with.
Section 9.05. Deposited Money and U.S. Government Obligations To Be Held in
Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee pursuant to Section 9.01 or 9.04 hereof in respect of
the outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent as the Trustee may determine, to the
Holders of such Notes, of all sums due and to become due thereon in respect of
principal, premium, if any, and accrued interest, but such money need not be
segregated from other funds except to the extent required by law.
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The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 9.01 or 9.04 hereof or the principal, premium, if
any, and interest received in respect thereof other than any such tax, fee or
other charge which by law is for the account of the Holders of the outstanding
Notes.
Anything in this Article 9 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 9.01 or
9.04 hereof which, in the opinion of a nationally-recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent Defeasance or Covenant Defeasance.
Section 9.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 9.01, 9.02 or 9.03 hereof 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 Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article 9 until such time as the Trustee or Paying Agent is permitted to
apply all such money or U.S. Government Obligations in accordance with Section
9.01 hereof; provided, however, that if the Company has made any payment of
principal of, premium, if any, or accrued interest on any Notes because of the
reinstatement of their obligations, the Company shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money or
U.S. Government Obligations held by the Trustee or Paying Agent.
Section 9.07. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture, all
moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be paid to the Trustee, or if sufficient
moneys have been deposited pursuant to Section 9.01 hereof, to the Company and
thereupon such Paying Agent shall be released from all further liability with
respect to such moneys.
Section 9.08. Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent or then held by
the Company in trust for the payment of the principal of, or premium, if any, or
interest on any Note that are not applied but remain unclaimed by the Holder of
such Note for two years after the date upon which the principal of, or premium,
if any, or interest on such Note shall have respectively become due and payable
shall be repaid to the Company upon Company Request, or if such moneys are then
held by the Company in trust, such moneys shall be released from such trust; and
the Holder of such Note entitled to receive
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such payment shall thereafter, as an unsecured general creditor, look only to
the Company for the payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money shall thereupon cease.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
Section 10.02. Notices.
Any notice or communication shall be given in writing and delivered in
person against written receipt, sent by facsimile, delivered by commercial
courier service or mailed by first-class mail, postage prepaid, or by a
recognized overnight courier, addressed as follows:
If to the Company:
International Shipholding Corporation
1700 Poydras Center
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attention: Chief Financial Officer
Fax: (000) 000-0000
Copy to:
Jones, Walker, Waechter,
Poitevent, Carrere, Denegre, L.L.P.
000 Xxxxx Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attention: X.X. XxXxxxxx XX, Esq.
Fax: (000) 000-0000
If to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xx. 00 X.
00
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Fax: (000) 000-0000
Such notices or communications shall be deemed effective when delivered by
hand, if personally delivered; five Business Days after being deposited in the
mail, postage prepaid, if mailed; one Business Day after timely delivered to a
next-day air courier guaranteeing overnight delivery and when receipt is
acknowledged by the addressee's telecopier machine, if telecopied; and shall be
sufficiently given if so given within the time prescribed in this Indenture.
The Company or the Trustee by written notice to the others may designate
additional or different addresses for sub sequent notices or communications.
Any notice or communication mailed to a Noteholder shall be mailed to him
by first-class mail, postage prepaid, at his address shown on the register kept
by the Registrar and shall be deemed effective five Business Days after being
deposited in the mail.
Failure to mail a notice or communication to a Noteholder or any defect in
it shall not affect its sufficiency with respect to other Noteholders. If a
notice or communication to a Noteholder is mailed in the manner provided above,
it shall be deemed duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by reason
of any other cause, it shall be impossible to mail any notice as required by
this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
Section 10.03. Communications by Holders with Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes.
Every Noteholder, by receiving and holding such Notes acknowledges that the
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c) and may not be held accountable by reason of the disclosure
of information as to the names and addresses of the Noteholders pursuant to TIA
Section 312(b).
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:
63
(1) an Officers' Certificate (which shall include the statements set forth
in Section 10.05 below) stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set forth in
Section 10.05 below) stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
Section 10.05. Statements Required in Certificate and Opinion.
Each certificate and opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, it or he has made
such examination or investigation as is necessary to enable it or him to express
an informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such Person, such
covenant or condition has been complied with.
Section 10.06. When Treasury Notes Disregarded.
In determining whether the Holders of the required aggregate principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or any other obligor on the Notes or by any Affiliate of any of
them shall be disregarded, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Notes which the Trustee actually knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith shall not be
disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to the Notes and that the pledgee is not
the Company, or any other obligor upon the Notes or any Affiliate of any of
them.
Section 10.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or meetings of
Noteholders. The Registrar and Paying Agent may make reasonable rules for their
functions.
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Section 10.08. Business Days; Legal Holidays.
A "Business Day" is a day that is not a Legal Holiday. A "Legal Holiday"
is a Saturday, a Sunday, a federally-recognized holiday or a day on which
banking institutions are not required to be open in the State of New York. 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.
Section 10.09. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEED ING
ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
Section 10.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan,
security or debt agreement of the Company or any Subsidiary thereof. No such
indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 10.11. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as such, of
the Company or any Guarantor shall not have any liability for any obligations of
the Company under the Notes or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creations. Each Noteholder
by accepting a Note waives and releases all such liability. Such waiver and
release are part of the consideration for the issuance of the Notes.
Section 10.12. Successors.
All agreements of the Company in this Indenture and the Notes shall bind
their respective successors. All agreements of the Trustee, any additional
trustee and any Paying Agents in this Indenture shall bind its successor.
Section 10.13. Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture. Each signed
counterpart shall be deemed an original, but all of them together represent one
and the same agreement.
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Section 10.14. Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
Section 10.15. Separability.
Each provision of this Indenture shall be considered separable and if for
any reason any provision which is not essential to the effectuation of the basic
purpose of this Indenture or the Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed all as of the date and year first written above.
INTERNATIONAL SHIPHOLDING
CORPORATION
By: ____________________
Name:
Title:
By: ____________________
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By: ____________________
Name:
Title:
66
SCHEDULE I
PERMITTED LIENS
Any and all security interests, rights of set off, liens or encumbrances
of any sort on deposit accounts created pursuant to the law of any state in
which International Shipholding Corporation maintains any such deposit accounts.
67
EXHIBIT A
(FACE OF NOTE)
[FORM OF NOTE]
THESE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE, PRIOR TO (X) THE DATE WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR
NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY ANY SUBSEQUENT
CHANGE IN APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"), ONLY (A)
TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE
FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CER TIFICATE OF TRANSFER ON THE REVERSE OF THE NOTES), (D) PURSUANT TO OFFERS
AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION
S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
THE MEANING OF SUBPARAGRAPH (a)(1), (a)(2), (a)(3) OR (a)(7) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS PURCHASING NOTES WITH AN AGGREGATE PRINCIPAL AMOUNT,
PLUS ACCRUED AND UNPAID INTEREST, IF ANY, OF AT LEAST $250,000 AND THAT IS
ACQUIRING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL "ACCREDITED INVESTOR", FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
68
COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN
THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE BE COMPLETED AND DELIVERED BY
THE TRANSFEROR TO THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
CUSIP Number
INTERNATIONAL SHIPHOLDING CORPORATION
7 3/4% SENIOR NOTES DUE 2007
No. ________ $_____________
International Shipholding Corporation, a Delaware corporation (the
"Company", which term includes any successor corporation), for value received
promises to pay to ______________ or registered assigns the principal sum of
________________ Dollars, on October 15, 2007.
Interest Payment Dates: April 15 and October 15, commencing April 15,
1998.
Record Dates: April 1 and October 1
Reference is made to the further provisions of this Note contained herein,
which will for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
INTERNATIONAL SHIPHOLDING
CORPORATION
By: ___________________________
By: ___________________________
69
Certificate of Authentication:
This is one of the 7 3/4% Senior Notes due 2007 referred to in the
within-mentioned Indenture
Dated:
THE BANK OF NEW YORK,
as Trustee
By: ______________________________
Authorized Signatory
70
(REVERSE SIDE)
INTERNATIONAL SHIPHOLDING CORPORATION
7 3/4% SENIOR NOTES DUE 2007
1. INTEREST.
International Shipholding Corporation, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note
semiannually on April 15 and October 15 of each year (each an "Interest Payment
Date"), commencing on April 15, 1998, at the rate of 7 3/4% per annum. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
Interest on the Notes will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from the date of the original
issuance of the Notes.
The Company shall pay interest on overdue principal, and on overdue
premium, if any, and overdue interest, to the extent lawful, at the rate of
interest borne by the Notes.
2. METHOD OF PAYMENT.
The Company will pay interest on this Note provided for in Paragraph 1
above (except defaulted interest) to the person who is the registered Holder of
this Note at the close of business on the April 1 or October 1 preceding the
Interest Payment Date (whether or not such day is a Business Day). The Holder
must surrender this Note to a Paying Agent to collect principal payments. 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; provided, however, that the Company may pay principal, premium,
if any, and interest by check payable in such money. It may mail an interest
check to the Holder's registered address.
3. PAYING AGENT AND REGISTRAR.
Initially, The Bank of New York, a New York banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Company may change any
Paying Agent or Registrar without notice to the Holders of the Notes. Neither
the Company nor any of its Subsidiaries or Affiliates may act as Paying Agent
but may act as Registrar or co- Registrar.
4. INDENTURE; RESTRICTIVE COVENANTS.
The Company issued this Note under an Indenture dated as of January 22,
1998 (the "Indenture") between the Company and the Trustee. The terms of this
Note 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 sections
77aaa-77bbbb) as in effect on the
71
date of the Indenture. This Note is subject to all such terms, and the Holder of
this Note is referred to the Indenture and said Trust Indenture Act for a
statement of them. All capitalized terms in this Note, unless otherwise defined,
have the meanings assigned to them by the Indenture.
The Notes are general unsecured senior obligations of the Company limited
(except as otherwise provided in the Indenture) in aggregate principal amount to
$160,000,000 which may be issued under the Indenture; provided the principal
amount of Notes issued on the Issue Date will not exceed $110,000,000. The
Indenture imposes certain restrictions on, among other things, the incurrence of
indebtedness, the incurrence of liens, the making of certain investments,
mergers and sale of assets, the payments of dividends on or the repurchase of,
capital stock of the Company and its Subsidiaries, certain other restricted
payments by the Company and its Subsidiaries, certain transactions with, and
investments in, its Affiliates, certain sale-leaseback transactions and a
provision regarding change-of-control transactions.
5. REDEMPTION.
Except for certain redemptions described in Section 6 below, the Company
may not redeem the Notes, in whole or in part, at any time.
6. OFFERS TO PURCHASE.
The Indenture requires that certain proceeds from Asset Sales be used,
subject to further limitations contained therein, to make an offer to purchase
certain amounts of Notes in accordance with the procedures set forth in the
Indenture. The Company is also required to make an offer to purchase Notes upon
occurrence of a Change of Control in accordance with procedures set forth in the
Indenture.
7. REGISTRATION RIGHTS.
Pursuant to the Registration Rights Agreement among the Company and
Citicorp Securities, Inc., Citibank Canada Securities Limited and Citibank
International plc, as initial purchasers of the Notes, the Company will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Note for Notes of a separate series
issued under the Indenture (or a trust indenture substantially identical to the
Indenture in accordance with the terms of the Registration Rights Agreement)
which have been registered under the Securities Act, in like principal amount
and having substantially identical terms as the Notes. The Holders shall be
entitled to receive certain additional interest payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
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8. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form without coupons in denominations of
$1,000 and integral multiples thereof. A Holder may register the transfer or
exchange of Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Note
selected for redemption or register the transfer of or exchange any Note for a
period of 15 days before a selection of Notes to be redeemed or any Note after
it is called for redemption in whole or in part, except the unredeemed portion
of any Note being redeemed in part.
9. PERSONS DEEMED OWNERS.
The registered Holder of this Note may be treated as the owner of it for
all purposes.
10. UNCLAIMED MONEY.
If money for the payment of principal, premium or interest on any Note
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Company at its request. After that, Holders entitled to money must
look to the Company for payment as general creditors unless an "abandoned
property" law designates another person.
11. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture or the Notes may be modified,
amended or supplemented by the Company and the Trustee with the consent of the
Holders of at least a majority in principal amount of the Notes then outstanding
and any existing Default or compliance with any provision may be waived in a
particular instance with the consent of the Holders of a majority in principal
amount of the Notes then outstanding. Without the consent of Holders, the
Company and the Guarantors, if any, and the Trustee may amend the Indenture or
the Notes or supplement the Indenture for certain specified purposes including,
but not limited to, providing for uncertificated Notes in addition to
certificated Notes, complying with Article Five of the Indenture, complying with
any requirements of the Commission under the TIA, adding a Guarantor pursuant to
the requirements of Section 4.11, securing the Notes pursuant to the
requirements of Section 4.10 and curing any ambiguity, defect or inconsistency,
or making any other change that does not adversely affect the rights of any
Holder.
12. SUCCESSOR ENTITY.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture and immediately before and
thereafter no Default exists and
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certain other conditions are satisfied, the predecessor corporation will be
released from those obligations.
13. DEFAULTS AND REMEDIES.
Events of Default are set forth in the Indenture. If an Event of Default
(other than an Event of Default pursuant to Sections 6.01(viii) or (ix) of the
Indenture with respect to the Company) occurs and is continuing, the Trustee by
notice to the Company, or the Holders of not less than 25% in aggregate
principal amount of the Notes then outstanding, may declare to be immediately
due and payable the entire principal amount of all the Notes then outstanding
plus accrued but unpaid interest to the date of acceleration; provided, however,
that after such acceleration but before judgment or decree based on such
acceleration is obtained by the Trustee, the Holders of a majority in aggregate
principal amount of the outstanding Notes may, under certain circumstances,
rescind and annul such acceleration and its consequences if all existing Events
of Default, other than the nonpayment of principal, premium or interest that has
become due solely because of the acceleration, have been cured or waived and if
the rescission would not conflict with any judgment or decree. No such
rescission shall affect any subsequent Default or impair any right consequent
thereto. In case an Event of Default specified in Sections 6.01(viii) or (ix) of
the Indenture with respect to the Company occurs, such principal amount,
together with premium, if any, and interest with respect to all of the Notes,
shall be due and payable immediately without any declaration or other act on the
part of the Trustee or the Holders of the Notes.
14. TRUSTEE DEALINGS WITH THE COMPANY.
The Trustee under the Indenture, in its individual or any other capacity,
may make loans to, accept deposits from, and perform services for the Company,
and may otherwise deal with the Company, as if it were not Trustee.
15. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, a director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company or under the Notes or the Indenture or for any claim
based on, in respect or by reason of, such obligations or their creation. The
Holder of this Note by accepting this Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of this Note.
16. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Note and for defeasance of certain covenants in the
Indenture upon compliance by the Company with certain conditions set forth in
the Indenture.
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17. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder of a Note or
an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (joint tenants with right of survivorship and not as tenants
in common), CUST (= Custodian), and U/G/M/A (Uniform Gifts to Minors Act).
18. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Securities Identification Procedures, the Company has caused CUSIP Numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of the Notes. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
19. GOVERNING LAW.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
THE COMPANY WILL FURNISH TO ANY HOLDER OF A NOTE UPON WRITTEN REQUEST AND
WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO: INTERNATIONAL
SHIPHOLDING CORPORATION, 1700 Poydras Center, 000 Xxxxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxx 00000, Attention: Chief Financial Officer.
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
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_______________________________________________________________________________
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
_______________________________________________________________________________
_______________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
[Check One]
[ ] (a) this Note is being transferred in compliance
with the exemption from registration under the
Securities Act provided by Rule 144A thereunder.
or
[ ] (b) this Note is being transferred other than in
accordance with (a) above and documents are being
furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note in the name of any person other than the Holder
hereof unless and until the conditions to any such transfer of registration set
forth herein and in Section 2.15 of the Indenture shall have been satisfied.
Date:____________________ Your Signature:__________________
_________________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee: _________________________________
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Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as amended.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this Note
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: __________________ _____________________________
NOTICE: To be executed by
an executive officer
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by the
Company pursuant to Section 4.08 or Section 4.15 of the Indenture, check the
appropriate box:
Section 4.08 Section 4.15
If you want to have only part of the Note purchased by the Company
pursuant to Section 4.08 or Section 4.15 of the Indenture, state the amount you
elect to have purchased:
$_________________
Date: ____________
Your Signature: _____________________
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(Sign exactly as your name appears on
the face of this Note)
________________________
Signature Guarantee
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which will include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as amended.
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EXHIBIT B
FORM OF LEGEND FOR GLOBAL NOTES
Any Global Note authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS
NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE,
AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF
THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION) ("DTC") TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRE SENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTER EST
HEREIN.
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EXHIBIT C
Form of Certificate to Be Delivered in Connection with
Transfers to Non-QIB Accredited Investors
___________, ______
Re: International Shipholding Corporation
(the "Company") 7 3/4% Senior Notes
due 2007 (the "Notes")
Dear Sirs:
In connection with our proposed purchase of $_______ aggregate principal
amount of the Notes, we confirm that:
1. We understand that any subsequent transfer of the Notes is subject to
certain restrictions and conditions set forth in the Indenture dated as of
January 22, 1998 relating to the Notes and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer the Notes except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act").
2. We understand that the Notes have not been registered under the
Securities Act, and that the Notes may not be offered or sold except as
permitted in the following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated, that if we should
sell any Notes within two years after the original issuance of the Notes, we
will do so only (A) to the Company, (B) inside the United States in compliance
with Rule 144A under the Securities Act, to a "qualified institutional buyer"
(as defined in Rule 144A), (C) inside the United States to an institutional
"accredited investor" (as defined below) that is purchasing Notes with an
aggregate principal amount, plus accrued and unpaid interest, if any, of at
least $250,000 and that, prior to such transfer, furnishes to you a signed
letter substantially in the form of this letter, (D) outside the United States
to a foreign person in compliance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the exemption from registration provided by Rule
144 under the Securities Act (if available), or (F) pursuant to an effective
registration statement under the Securities Act, and we further agree to provide
to any person purchasing any of the Notes from us a notice advising such
purchaser that resales of the Notes are restricted as stated herein.
3. We understand that, on any proposed resale of any Notes, we will be
required to furnish to you and the Company such certifications, legal opinions
and other information as you and the Company may reasonably require to confirm
that the proposed sale complies with the fore going restrictions. We further
understand that the Notes purchased by us will bear a legend to the foregoing
effect.
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4. We are an "accredited investor" (as defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act) and have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of our investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its investment.
5. We are acquiring the Notes purchased by us for our own account or for
one or more accounts (each of which is an institutional "accredited investor")
as to each of which we exercise sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the mat ters covered hereby.
Very truly yours,
[Name of Transferee]
By: ___________________________
Authorized Signature
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EXHIBIT D
Form of Certificate to Be
Delivered in Connection with
Transfers Pursuant to Regulation S
_________, _____
[ ]
Re: International Shipholding Corporation
(the "Company") 7 3/4% Senior Notes
due 2007 (the "Notes")
Dear Sirs:
In connection with our proposed sale of $___________aggregate principal
amount of the Notes, we confirm that such sale has been effected pursuant to and
in accordance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United States;
(2) either (a) at the time the buy offer was originated, the transferee
was outside the United States or we and any person acting on our behalf
reasonably believed that the transferee was outside the United States, or (b)
the transaction was executed in, on or through the facilities of a designated
off-shore securities market and neither we nor any person acting on our behalf
knows that the transaction has been pre-arranged with a buyer in the United
States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we understand that, on any proposed resale of any Notes, we will be
required to furnish to you and the Company such certifications, legal opinions
and other information as you and the Company may reasonably require to confirm
that the proposed sale complies with the fore going restrictions. We further
understand that the Notes purchased by us will bear a legend to the foregoing
effect; and
(6) we have advised the transferee of the transfer restrictions applicable
to the Notes.
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You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By: ___________________________
Authorized Signature
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