EXHIBIT 4.1
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RURAL/METRO CORPORATION,
as Issuer
12 3/4% Senior Discount Notes due 2016
________________________
INDENTURE
________________________
Dated as of March 4, 2005
________________________
XXXXX FARGO BANK, N.A.,
as Trustee
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TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions...................................................................................1
Section 1.02. Other Definitions............................................................................21
Section 1.03. Incorporation by Reference of Trust Indenture Act............................................23
Section 1.04. Rules of Construction........................................................................23
ARTICLE 2
THE NOTES
Section 2.01. Amount of Notes; Issuable in Series..........................................................24
Section 2.02. Form and Dating..............................................................................25
Section 2.03. Execution and Authentication.................................................................25
Section 2.04. Registrar and Paying Agent...................................................................26
Section 2.05. Paying Agent to Hold Money in Trust..........................................................27
Section 2.06. Holder Lists.................................................................................27
Section 2.07. Transfer and Exchange........................................................................27
Section 2.08. Replacement Notes............................................................................28
Section 2.09. Outstanding Notes............................................................................28
Section 2.10. Temporary Notes..............................................................................29
Section 2.11. Cancellation.................................................................................29
Section 2.12. Defaulted Interest...........................................................................29
Section 2.13. CUSIP Numbers, ISINs, etc....................................................................29
ARTICLE 3
REDEMPTION
Section 3.01. Optional Redemption..........................................................................30
Section 3.02. Redemption with Proceeds of Equity Offerings.................................................30
Section 3.03. Method and Effect of Redemption..............................................................30
Section 3.04. Deposit of Redemption Price..................................................................32
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.............................................................................32
Section 4.02. Reports and Other Information................................................................33
Section 4.03. Limitation on Incurrence of Indebtedness and Issuance of Preferred Stock....................34
Section 4.04. Limitation on Restricted Payments............................................................36
Section 4.05. Dividend and Other Payment Restrictions Affecting Subsidiaries..............................38
Section 4.06. Asset Sales..................................................................................40
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Section 4.07. Transactions with Affiliates.................................................................42
Section 4.08. Change of Control............................................................................43
Section 4.09. Compliance Certificate.......................................................................45
Section 4.10. Further Instruments and Acts.................................................................45
Section 4.11. Liens........................................................................................45
Section 4.12. [Reserved]...................................................................................45
Section 4.13. Maintenance of Office or Agency..............................................................45
Section 4.14. Business Activities..........................................................................46
Section 4.15. Payment for Consent..........................................................................46
Section 4.16. [Reserved]...................................................................................46
Section 4.17. Limitation on Designations of Unrestricted Subsidiaries.....................................46
ARTICLE 5
MERGER, CONSOLIDATION OR SALE OF ASSETS
Section 5.01. Consolidation, Merger or Sale of Assets of the Issuer........................................47
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default............................................................................49
Section 6.02. Acceleration.................................................................................50
Section 6.03. Other Remedies...............................................................................52
Section 6.04. Waiver of Past Defaults......................................................................52
Section 6.05. Control by Majority..........................................................................52
Section 6.06. Limitation on Suits..........................................................................52
Section 6.07. Rights of the Holders to Receive Payment.....................................................53
Section 6.08. Collection Suit by Trustee...................................................................53
Section 6.09. Trustee May File Proofs of Claim.............................................................53
Section 6.10. Priorities...................................................................................53
Section 6.11. Undertaking for Costs........................................................................54
Section 6.12. Waiver of Stay or Extension Laws.............................................................54
Section 6.13. Waiver of Substantive Consolidation Claims...................................................54
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee............................................................................55
Section 7.02. Rights of Trustee............................................................................56
Section 7.03. Individual Rights of Trustee.................................................................57
Section 7.04. Trustee's Disclaimer.........................................................................57
Section 7.05. Notice of Defaults...........................................................................57
Section 7.06. Reports by Trustee to the Holders............................................................57
Section 7.07. Compensation and Indemnity...................................................................57
Section 7.08. Replacement of Trustee.......................................................................58
Section 7.09. Successor Trustee by Merger..................................................................59
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Section 7.10. Eligibility; Disqualification................................................................59
Section 7.11. Preferential Collection of Claims Against Issuer.............................................60
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
Section 8.01. Discharge of Liability on Notes..............................................................60
Section 8.02. Defeasance...................................................................................60
Section 8.03. Conditions to Defeasance.....................................................................61
Section 8.04. Application of Trust Money...................................................................63
Section 8.05. Repayment to Issuer..........................................................................63
Section 8.06. Indemnity for Government Obligations.........................................................63
Section 8.07. Reinstatement................................................................................63
ARTICLE 9
AMENDMENTS AND WAIVERS
Section 9.01. Without Consent of the Holders...............................................................63
Section 9.02. With Consent of the Holder...................................................................64
Section 9.03. Compliance with Trust Indenture Act..........................................................65
Section 9.04. Revocation and Effect of Consents and Waivers................................................65
Section 9.05. Notation on or Exchange of Notes.............................................................66
Section 9.06. Trustee to Sign Amendments...................................................................66
Section 9.07. Additional Voting Terms; Calculation of Principal Amount.....................................66
ARTICLE 10
[RESERVED]
ARTICLE 11
[RESERVED]
ARTICLE 12
[RESERVED]
ARTICLE 13
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls.................................................................67
Section 13.02. Notices......................................................................................67
Section 13.03. Communication by the Holders with Other Holders..............................................68
Section 13.04. Certificate and Opinion as to Conditions Precedent...........................................68
Section 13.05. Statements Required in Certificate or Opinion................................................68
Section 13.06. When Notes Disregarded.......................................................................69
Section 13.07. Rules by Trustee, Paying Agent and Registrar.................................................69
Section 13.08. Legal Holidays...............................................................................69
Section 13.09. Governing Law................................................................................69
Section 13.10. Jurisdiction; Consent to Service of Process..................................................69
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Section 13.11. No Recourse Against Others...................................................................70
Section 13.12. Successors...................................................................................70
Section 13.13. Multiple Originals...........................................................................70
Section 13.14. Table of Contents; Headings..................................................................70
Section 13.15. Indenture Controls...........................................................................70
Section 13.16. Severability.................................................................................70
Appendix A - Provisions Relating to Initial Notes, Additional Notes and
Exchange Notes
EXHIBIT INDEX
Exhibit A - Initial Note
Exhibit B - Exchange Note
Exhibit C - Form of Transferee Letter of Representation
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- -------
310(a)(1)........................................................ 7.10
(a)(2)...................................................... 7.10
(a)(3)...................................................... N.A.
(a)(4)...................................................... N.A.
(b)......................................................... 7.08; 7.10
(c)......................................................... N.A.
311(a)........................................................... 7.11
(b)......................................................... 7.11
(c)......................................................... N.A.
312(a)........................................................... 2.06
(b)......................................................... 13.03
(c)......................................................... 13.03
313(a)........................................................... 7.06
(b)(1)...................................................... N.A.
(b)(2)...................................................... 7.06
(c)......................................................... 7.06
(d)......................................................... 4.02; 4.09
314(a)........................................................... 4.02; 4.09
(b)......................................................... N.A.
(c)(1)...................................................... 13.04
(c)(2)...................................................... 13.04
(c)(3)...................................................... N.A.
(d)......................................................... N.A.
(e)......................................................... 13.05
(f)......................................................... 4.10
315(a)........................................................... 7.01
(b)......................................................... 7.05
(c)......................................................... 7.01
(d)......................................................... 7.01
(e)......................................................... 6.11
316(a) (last sentence)........................................... 13.06
(a)(1)(A)................................................... 6.05
(a)(1)(B)................................................... 6.04
(a)(2)...................................................... N.A.
(b)......................................................... 6.07
317(a)(1)........................................................ 6.08
(a)(2)...................................................... 6.09
(b)......................................................... 2.05
318(b)........................................................... 13.01
N.A. Means Not Applicable.
Note: This Cross-Reference Table shall not, for any purposes, be deemed to be
part of this Indenture.
INDENTURE dated as of March 4, 2005 between RURAL/METRO CORPORATION,
a Delaware corporation, as issuer (the "ISSUER") and XXXXX FARGO BANK, N.A., a
national banking association, as trustee.
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of (a) $93,500,000 aggregate
principal amount at maturity (issued at a discount to generate approximately
$50,208,565 in gross proceeds) of the Issuer's 12 3/4% Senior Discount Notes due
2016 (the "ORIGINAL NOTES") issued on the date hereof (together with the Senior
Subordinated Notes, the "OFFERINGS"), (b) any Additional Notes (as defined
herein) that may be exchanged for Original Notes or otherwise issued after the
date hereof in the form of Exhibit A (all such securities in clauses (a) and
(b), excluding the Senior Subordinated Notes, being referred to collectively as
the "INITIAL NOTES"), and (c) if and when issued as provided in the Registration
Rights Agreement (as defined in Appendix A hereto (the "APPENDIX")) or otherwise
registered under the Securities Act (as defined in the Appendix) and issued, the
Issuer's 12 3/4% Senior Discount Notes due 2016 (the "EXCHANGE NOTES" and,
together with the Initial Notes, the "NOTES") issued in the Registered Exchange
Offer (as defined in the Appendix) in exchange for any Initial Notes or
otherwise registered under the Securities Act and issued in the form of Exhibit
B. Subject to the conditions and compliance with the covenants set forth in this
Indenture, the Issuer may issue an unlimited aggregate principal amount at
maturity of Additional Notes.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"ACCRETED VALUE" means, as of any date (the "SPECIFIED DATE"), the
amount provided below for each $1,000 principal amount at maturity of Notes:
(1) if the Specified Date occurs on one of the following dates
(each, a "SEMI-ANNUAL ACCRUAL DATE"), the Accreted Value will equal
the amount set forth below for such Semi-Annual Accrual Date:
SEMI-ANNUAL ACCRUAL DATE ACCRETED VALUE
September 15, 2005 $ 573.38
March 15, 2006 $ 609.93
September 15, 2006 $ 648.82
March 15, 2007 $ 690.18
September 15, 2007 $ 734.18
March 15, 2008 $ 780.98
September 15, 2008 $ 830.77
March 15, 2009 $ 883.73
September 15, 2009 $ 940.07
March 15, 2010 $ 1,000.00
the foregoing Accreted Values shall be increased, if necessary, to
reflect any accretion of Registration Default Damages;
(2) if the Specified Date occurs before the first Semi-Annual
Accrual Date, the Accreted Value will equal the sum of (A) the
original issue price of a Note and (B) an amount equal to the product
of (x) the Accreted Value for the first Semi-Annual Accrual Date less
such original issue price multiplied by (y) a fraction, the numerator
of which is the number of days from the Issue Date to the Specified
Date, using a 360-day year of twelve 30-day months, and the
denominator of which is the number of days elapsed from the Issue Date
to the first Semi-Annual Accrual Date, using a 360-day year of twelve
30-day months;
(3) if the Specified Date occurs between two Semi-Annual Accrual
Dates, the Accreted Value will equal the sum of (A) the Accreted Value
for the Semi-Annual Accrual Date immediately preceding such Specified
Date and (B) an amount equal to the product of (x) the Accreted Value
for the immediately following Semi-Annual Accrual Date less the
Accreted Value for the Semi-Annual Accrual Date immediately preceding
such Specified Date multiplied by (y) a fraction, the numerator of
which is the number of days from the immediately preceding Semi-Annual
Accrual Date to the Specified Date, using a 360-day year of twelve
30-day months, and the denominator of which is 180; or
(4) if the Specified Date occurs on or after the Full Accretion
Date, the Accreted Value will equal $1,000.
"ACQUIRED INDEBTEDNESS" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary,
or at the time it merges or consolidates with the Issuer or any of the
Restricted Subsidiaries or Indebtedness assumed by the Issuer or any Restricted
Subsidiary in connection with the acquisition of assets from such Person and in
each case whether or not incurred by such Person in connection with, or in
anticipation or contemplation of, such Person becoming a Restricted Subsidiary
or such acquisition, merger or consolidation.
"ADDITIONAL NOTES" means additional 12 3/4% Senior Discount Notes due
2016 issued under the terms of this Indenture in accordance with Section 4.03.
"AFFILIATE" means, with respect to any specified Person, any other
Person who directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person..
The term "CONTROL" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "CONTROLLING" and "CONTROLLED" have meanings correlative of the
foregoing.
"APPLICABLE PREMIUM" means with respect to any Note on any applicable
redemption date, the excess of:
(x) the present value at such redemption date of the redemption
price of such Notes at March 15, 2010 (such redemption price being set
forth in the table appearing in Section 3.01) computed using a
discount rate equal to the Treasury Rate as of such redemption date
plus 50 basis points; over
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(y) the then Accreted Value of the Note being redeemed.
"ASSET ACQUISITION" means (1) an Investment by Issuer or any
Restricted Subsidiary in any other Person pursuant to which such Person shall
become a Restricted Subsidiary, or shall be merged with or into the Issuer or
any Restricted Subsidiary, or (2) the acquisition by the Issuer or any
Restricted Subsidiary of the assets of any Person (other than a Restricted
Subsidiary) which assets are used or useful in a Permitted Business, other than
in the ordinary course of business.
"ASSET SALE" means any direct or indirect sale, issuance, conveyance,
lease (other than operating leases entered into in the ordinary course of
business), assignment or other transfer (other than the granting of a Lien in
accordance with this Indenture) for value by the Issuer or any of the Restricted
Subsidiaries (including any Sale and Leaseback Transaction) to any Person other
than the Issuer or a Restricted Subsidiary of (a) any Capital Stock of any
Restricted Subsidiary or (b) any other property or assets of the Issuer or any
Restricted Subsidiary; provided, however, that Asset Sales shall not include:
(1) a transaction or series of related transactions for which the
Issuer or the Restricted Subsidiaries receive aggregate consideration
or which has a Fair Market Value of less than $2.0 million;
(2) the sale, lease, conveyance, disposition or other transfer of
all or substantially all of the assets of the Issuer as permitted by
Article Five or any transaction that constitutes a Change of Control;
(3) any Restricted Payment made in accordance with Section 4..04
or a Permitted Investment;
(4) the designation of a Restricted Subsidiary made in accordance
with Section 4.17;
(5) the sale or other disposition of cash or Cash Equivalents;
(6) the sale of obsolete or worn out equipment or any other
property (including inventory or equipment) that, in the reasonable
judgment of the Issuer, is obsolete or worn out and is no longer
useful in the conduct of the business of the Issuer and its Restricted
Subsidiaries;
(7) Permitted Liens; or
(8) the sale of inventory and products in the ordinary course of
business.
"ATTRIBUTABLE INDEBTEDNESS" in respect of a Sale and Leaseback
Transaction means, as at the time of determination, the greater of
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(1) the fair value of the property subject to such arrangement;
and
(2) the present value (discounted at the rate of interest
implicit in such transaction, determined in accordance with GAAP) 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).
"BENEFICIAL OWNER" has the meaning assigned to such term in Rule
13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in Section
13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition. The terms "Beneficially Owns" and "Beneficially Owned" have a
corresponding meaning.
"BOARD OF DIRECTORS" means, as to any Person, the board of directors
of such Person or any duly authorized committee thereof.
"BOARD RESOLUTION" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"BUSINESS DAY" means a day other than a Saturday, Sunday or other day
on which commercial banking institutions in New York City are authorized or
required by law to close.
"CAPITAL STOCK" means
(1) with respect to any Person that is a corporation, any and all
shares, interests, rights to purchase, warrants, options (whether or
not currently exercisable), participations or other equivalents
(however designated and whether or not voting) representing interests
in corporate stock, including each class of Common Stock and Preferred
Stock of such Person and
(2) with respect to any Person that is not a corporation, any and
all partnership or other Equity Interests of such Person.
"CAPITALIZED LEASE OBLIGATION" means, as to any Person, the
obligations of such Person under a lease that are required to be classified and
accounted for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date, determined in accordance with GAAP.
"CASH EQUIVALENTS" means:
(1) marketable direct obligations issued by, or unconditionally
guaranteed by, the United States Government or issued by any agency
thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition
thereof;
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(2) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such
state or any public instrumentality thereof maturing within one year
from the date of acquisition thereof and, at the time of acquisition,
having one of the two highest ratings obtainable from either Standard
& Poor's Ratings Group, a division of The XxXxxx-Xxxx Companies, Inc.
("S&P") or Xxxxx'x Investors Service, Inc. ("MOODY'S");
(3) commercial paper maturing no more than one year from the date
of creation thereof and, at the time of acquisition, having a rating
of at least A-1 from S&P or at least P-1 from Moody's;
(4) certificates of deposit or bankers' acceptances maturing
within one year from the date of acquisition thereof issued by any
bank organized under the laws of the United States of America or any
State thereof or the District of Columbia or any U.S. branch of a
foreign bank having at the date of acquisition thereof combined
capital and surplus of not less than $250.0 million;
(5) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clause (1)
above entered into with any bank meeting the qualifications specified
in clause (4) above; and
(6) investments in money market funds which invest substantially
all their assets in securities of the types described in clauses (1)
through (5) above.
"CHANGE OF CONTROL" means the occurrence of any of the following
events:
(1) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act), is or becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that for purposes of this clause that person or group shall be
deemed to have "beneficial ownership" of all securities that any such
person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly
or indirectly, of Voting Stock representing 35% or more of the voting
power of the total outstanding Voting Stock of the Issuer;
(2) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Board of Directors of
the Issuer (together with any new directors whose election to such
Board of Directors or whose nomination for election by the
stockholders of the Issuer was approved by a vote of the majority of
the directors of the Issuer then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the
Issuer;
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(3) (a) all or substantially all of the assets of the Issuer and
the Restricted Subsidiaries, taken as a whole, are sold or otherwise
transferred to any Person other than a Wholly-Owned Restricted
Subsidiary or (b) the Issuer consolidates or merges with or into
another Person or any Person consolidates or merges with or into the
Issuer, in either case under this clause (3), in one transaction or a
series of related transactions in which immediately after the
consummation thereof Persons owning Voting Stock representing in the
aggregate a majority of the total voting power of the Voting Stock of
the Issuer immediately prior to such consummation do not own Voting
Stock representing a majority of the total voting power of the Voting
Stock of the Issuer or the surviving or transferee Person;
(4) the Issuer shall adopt a plan of liquidation or dissolution
or any such plan shall be approved by the stockholders of the Issuer;
or
(5) the Issuer shall cease to directly or indirectly own 100% of
the Capital Stock of Rural/Metro LLC.
"CODE" means the United States Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code as in effect on the
date of this Indenture and any subsequent provisions of the Code amendatory
thereof, supplemental thereto or substituted therefor.
"COMMISSION" means the Securities and Exchange Commission, as from
time to time constituted, or if at any time after the execution of this
Indenture such Commission is not existing and performing the applicable duties
now assigned to it, then the body or bodies performing such duties at such time.
"COMMON STOCK" of any Person means any and all shares, interests or
other participations in, and other equivalents (however designated and whether
voting or non-voting) of such Person's common stock, whether outstanding on the
Issue Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"CONSOLIDATED EBITDA" means, with respect to the Issuer, for any
period, the sum (without duplication) of:
(1) Consolidated Net Income; and
(2) to the extent Consolidated Net Income has been reduced
thereby and with respect to the portion of Consolidated Net Income
attributable to any Restricted Subsidiary only to the extent that the
declaration of dividends or similar distributions by that Restricted
Subsidiary of that income is not restricted by a contract, operation
of law or otherwise at the date of determination:
(A) all income taxes paid or accrued in accordance with GAAP
for such period;
(B) Consolidated Interest Expense, and
(C) Consolidated Non-cash Charges,
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less any non-cash items increasing Consolidated Net Income (other than
(i) accruals of revenue in the ordinary course of business and (ii)
reversals of prior accruals or reserves for non-cash items) for such
period, all as determined on a consolidated basis for the Issuer and
the Restricted Subsidiaries in accordance with GAAP.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, with respect to any
Person, the ratio of Consolidated EBITDA of any Person during the four full
fiscal quarters (the "FOUR QUARTER PERIOD") ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio for which financial statements are available (the
"TRANSACTION DATE") to Consolidated Fixed Charges of any Person for the Four
Quarter Period. In addition to and without limitation of the foregoing, for
purposes of this definition, "Consolidated EBITDA" and "Consolidated Fixed
Charges" shall be calculated after giving effect on a pro forma basis for the
period of such calculation to:
(1) the incurrence or repayment of any Indebtedness or issuance
or redemption of Preferred Stock of any Person or any of the
Restricted Subsidiaries (and the application of the proceeds thereof)
giving rise to the need to make such calculation and any incurrence or
repayment of other Indebtedness or issuance or redemption of Preferred
Stock (and the application of the proceeds thereof), other than the
incurrence or repayment of Indebtedness in the ordinary course of
business for working capital purposes pursuant to working capital
facilities, occurring during the Four Quarter Period or at any time
subsequent to the last day of the Four Quarter Period and on or prior,
to the Transaction Date, as if such incurrence or repayment or
issuance or redemption, as the case may be (and the application of the
proceeds thereof), occurred on the first day of the Four Quarter
Period; and
(2) any asset sales or other dispositions or Asset Acquisitions
(including, without limitation, any Asset Acquisition giving rise to
the need to make such calculation as a result of any Person or one of
its Restricted Subsidiaries (including any Person who becomes a
Restricted Subsidiary as a result of the Asset Acquisition) incurring,
assuming or otherwise being liable for Acquired Indebtedness and also
including any Consolidated EBITDA (including any pro forma expense and
cost reductions calculated on a basis consistent with Regulation S-X
under the Exchange Act or certified as expected to occur within six
months after such transaction in a Board Resolution of such Person)
attributable to the assets which are the subject of the Asset
Acquisition or asset sale or other disposition during the Four Quarter
Period) occurring during the Four Quarter Period or at any time
subsequent to the last day of the Four Quarter Period and on or prior
to the Transaction Date as if such asset sale or other disposition or
Asset Acquisition (including the incurrence, assumption or liability
for any such Acquired Indebtedness) occurred on the first day of the
Four Quarter Period.
If any Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give effect to the incurrence of such guaranteed Indebtedness as if such
Person or Restricted Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
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"CONSOLIDATED FIXED CHARGES" means, with respect to any Person for
any period, the sum, without duplication, of:
(1) Consolidated Interest Expense, plus
(2) the product of (x) the amount of all dividend payments on any
series of Preferred Stock of such Person or any of its Restricted
Subsidiaries (other than dividends paid in Qualified Capital Stock)
paid, accrued and/or scheduled to be paid or accrued during such
period times (y) a fraction, the numerator of which is one and the
denominator of which is one minus the then current effective
consolidated federal, state, foreign and local income tax rate of such
Person, expressed as a decimal.
Furthermore, in calculating "Consolidated Fixed Charges":
(1) interest on outstanding Indebtedness determined on a
fluctuating basis as of the Transaction Date and which will continue
to be so determined thereafter shall be deemed to have accrued at a
fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date;
(2) if interest on any Indebtedness actually incurred on the
Transaction Date may optionally be determined at an interest rate
based upon a factor of a prime or similar rate, a eurocurrency
interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect
during the Four Quarter Period; and
(3) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to Interest Swap Obligations, shall be
deemed to accrue at the rate per annum in effect on the Transaction
Date resulting after giving effect to the operation of such agreements
on such date.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person for
any period, the sum of, without duplication:
(1) the aggregate of the interest expense of such Person and the
Restricted Subsidiaries for such period determined on a consolidated
basis in accordance with GAAP, including without limitation or
duplication,
(A) any amortization of debt discount and amortization or
write-off of deferred financing costs (other than the write-off
of deferred financing charges as a result of the Refinancing and
the amortization of deferred financing charges arising from the
Refinancing),
(B) the net payments and receipts under Interest Swap
Obligations,
(C) all capitalized interest,
8
(D) commissions, discounts and other fees and charges owed
with respect to letters of credit securing financial obligations,
bankers' acceptance financing and receivables financings,
(E) all other non-cash interest expense, and
(F) all interest payable with respect to discontinued
operations;
(2) the interest component of Capitalized Lease Obligations and
Attributable Indebtedness paid, accrued and/or scheduled to be paid or
accrued by such Person and its Restricted Subsidiaries during such
period as determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED NET INCOME" means, with respect to any Person, for any
period, the aggregate net income (or loss) of such Person and its Restricted
Subsidiaries for such period as determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded therefrom:
(1) net gains and losses from asset sales;
(2) extraordinary or non-recurring gains, losses and charges
(determined on an after-tax basis);
(3) the net income (but not loss) of any Restricted Subsidiary to
the extent that the declaration of dividends or similar distributions
by that Restricted Subsidiary of that income is restricted by a
contract, operation of law or otherwise (other than restrictions
applicable to Rural/Metro LLC and its Restricted Subsidiaries);
(4) the net income or loss of any Person, other than a Restricted
Subsidiary, except, in the case of net income, to the extent of cash
dividends or distributions paid to any Person or to its Restricted
Subsidiaries by such Person or, in the case of a loss, to the extent
such loss is required to be funded in cash;
(5) any restoration to income of any contingency reserve, except
to the extent that provision for such reserve was made out of
Consolidated Net Income accrued at any time following the Issue Date;
(6) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such
period whether or not such operations were classified as
discontinued);
(7) gains and losses due solely to fluctuations in currency
values and the related tax effects according to GAAP;
(8) unrealized gains and losses with respect to Interest Swap
Obligations;
9
(9) in the case of a successor to the Issuer by consolidation or
merger or as a transferee of such Person's assets, any earnings of the
successor corporation prior to such consolidation, merger or transfer
of assets;
(10) cumulative effect of any change in accounting principle; and
(11) any non-cash compensation arising from the award or exercise
of stock options, stock awards or restricted stock of such Person.
"CONSOLIDATED NON-CASH CHARGES" means, with respect to any Person,
for any period, the aggregate depreciation, amortization and other non-cash
expenses or charges of such Person and its Restricted Subsidiaries reducing
Consolidated Net Income of such Person for such period, determined on a
consolidated basis in accordance with GAAP (excluding any such charge which
requires an accrual of or a reserve for cash charges for any future period).
"CREDIT AGREEMENT" means the Credit Agreement to be dated as of the
Issue Date, among the Issuer, the guarantors party thereto, the lenders party
thereto in their capacities as lenders thereunder and XX Xxxxxx Xxxxx Bank, NA,
as syndication agent, and Citicorp North America, Inc., as administrative agent,
together with the related documents thereto (including, without limitation, any
notes, guarantees, collateral and security documents, Interest Swap Obligations
and other instruments and agreements executed in connection therewith), in each
case as such agreements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including increasing the amount of available borrowings
thereunder (provided that such increase in borrowings is permitted by Section
4.03) or adding Subsidiaries as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under such agreement or any successor or
replacement agreement and whether by the same or any other agent, lender or
group of lenders.
"CREDIT FACILITIES" means one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other institutional lenders or other investors providing
for revolving credit loans, term loans or letters of credit, in each case as
amended, modified, renewed, refunded, replaced, restated, substituted or
refinanced in whole or in part from time to time.
"DEFAULT" means an event or condition the occurrence of which is, or
with the lapse of time or the giving of notice of both would be, an Event of
Default.
"DISQUALIFIED CAPITAL STOCK" means that portion of any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the holder
thereof), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is
mandatorily exchangeable for Indebtedness, or is redeemable or exchangeable for
Indebtedness, at the sole option of the holder thereof on or prior to 91 days
after the final maturity date of the Notes.
"DTC" means The Depository Trust Company.
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"EQUITY INTERESTS" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"EQUITY OFFERING" means a sale of common equity capital of the
Issuer.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto, and the rules and regulations of
the Commission promulgated thereunder.
"FAIR MARKET VALUE" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair Market
Value shall be determined by the Board of Directors of Issuer acting reasonably
and in good faith and shall be evidenced by a Board Resolution of the Board of
Directors of the Issuer.
"FOREIGN SUBSIDIARY" means a Restricted Subsidiary not organized or
existing under the laws of the United States of America or any state or
territory thereof and any direct or indirect subsidiary of such Restricted
Subsidiary.
"FOUR QUARTER PERIOD" has the meaning set forth in the definition of
Consolidated Fixed Charge Coverage Ratio.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accounts and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession of the United States, which are in effect on the Issue
Date.
"GOVERNMENT SECURITIES" means securities that are:
(1) direct obligations of the United States of America for the
timely payment of which its full faith and credit is pledged; or
(2) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of America
the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America;
which, in either case, are not callable or redeemable at the option of the
issuers 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 Government Securities or a specific payment of principal of or
interest on any such Government Securities 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 Government Securities or the specific payment
of principal of or interest on the Government Securities evidenced by such
depository receipt.
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"GUARANTEE" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, through letters of credit
or reimbursement agreements in respect thereof, of all or any part of any
Indebtedness or other obligations.
"HOLDER" means any registered holder, from time to time, of any
Notes.
"INDEBTEDNESS" means, with respect to any Person, without
duplication:
(1) all indebtedness of such Person for borrowed money;
(2) all indebtedness of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(3) all Capitalized Lease Obligations of such Person;
(4) all indebtedness of such Person issued or assumed as the
deferred purchase price of property, all conditional sale obligations
and all indebtedness under any title retention agreement (but
excluding trade accounts payable and other accrued liabilities arising
in the ordinary course of business that are not overdue by 90 days or
more or are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted);
(5) all indebtedness for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction;
(6) guarantees and other contingent obligations in respect of
Indebtedness of any other Person referred to in clauses (1) through
(5) above and clause (8) below;
(7) all indebtedness of any other Person of the type referred to
in clauses (1) through (6) which are secured by any Lien on any
property or asset of such Person, the amount of such indebtedness
being deemed to be the lesser of the Fair Market Value of such
property or asset or the amount of the indebtedness so secured;
(8) all indebtedness under Interest Swap Obligations of such
Person; and
(9) all Disqualified Capital Stock of such Person with the amount
of Indebtedness represented by such Disqualified Capital Stock being
equal to the greater of its voluntary or involuntary liquidation
preference and its maximum fixed repurchase price, but excluding
accrued and unpaid dividends, if any.
For purposes hereof, the "maximum fixed repurchase price" of any
Disqualified Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Disqualified Capital Stock as if
such Disqualified Capital Stock were purchased on any date on which Indebtedness
12
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 Disqualified
Capital Stock, such Fair Market Value shall be determined reasonably and in good
faith by the Board of Directors of the issuer of such Disqualified Capital
Stock. For the avoidance of doubt, letters of credit issued pursuant to the
dedicated letter of credit facility contained in the Credit Agreement shall
constitute "Indebtedness" under this definition only as and when they are
required, in accordance with GAAP, to be accounted for as indebtedness on the
face of the Issuer's balance sheet.
"INDENTURE" means this Indenture as amended or supplemented from time
to time.
"INDEPENDENT FINANCIAL ADVISOR" means a firm
(1) which does not, and whose directors, officers and employees
and Affiliates do not, have a direct or indirect material financial
interest in or control relationship with the Issuer; and
(2) which, in the judgment of the Board of Directors of the
Issuer, is otherwise independent and qualified to perform the task for
which it is to be engaged.
"INITIAL PURCHASERS" means, collectively, Citigroup Global Markets
Inc. and X.X. Xxxxxx Securities Inc.
"INTEREST SWAP OBLIGATIONS" means the obligations of the Issuer and
the Restricted Subsidiaries pursuant to any arrangement with any other Person,
whereby, directly or indirectly, the Issuer or any Restricted Subsidiary is
entitled to receive from time to time periodic payments calculated by applying
either a floating or a fixed rate of interest on a stated notional amount in
exchange for periodic payments made by such other Person calculated by applying
a fixed or a floating rate of interest on the same notional amount and shall
include, without limitation, interest rate swaps, caps, floors, collars and
similar agreements.
"INVESTMENT" means, with respect to any Person, any direct or
indirect loan or other extension of credit (including, without limitation,
guarantee) 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 evidences of Indebtedness
issued by, any Person. "Investment" shall exclude extensions of trade credit by
the Issuer and the Restricted Subsidiaries in the ordinary course of business.
If the Issuer or any Restricted Subsidiary sells or otherwise disposes of any
Capital Stock of any Restricted Subsidiary (the "REFERENT SUBSIDIARY") such
that, after giving effect to any such sale or disposition, the Referent
Subsidiary shall cease to be a Restricted Subsidiary, the Issuer shall be deemed
to have made an Investment on the date of any such sale or disposition equal to
the Fair Market Value of the Capital Stock of the Referent Subsidiary not sold
or disposed of.
"ISSUE DATE" means March 4, 2005, the date of initial issuance of the
Notes.
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"LIEN" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).
"XXXXX'X" has the meaning set forth in the definition of Cash
Equivalents.
"NET CASH PROCEEDS" means, with respect to any Asset Sale, the
proceeds in the form of cash or Cash Equivalents, including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents (other than the portion of any such deferred payment constituting
interest), received by the Issuer or any of the Restricted Subsidiaries from
such Asset Sale net of:
(1) reasonable out-of-pocket expenses and fees relating to such
Asset Sale (including, without limitation, legal, accounting and
investment banking fees, sales commissions and relocation expenses);
(2) taxes paid or payable after taking into account any reduction
in consolidated tax liability due to available tax credits or
deductions and any tax sharing arrangements;
(3) repayments of Indebtedness secured by a Lien permitted by
this Indenture on the property or assets subject to such Asset Sale
that is required to be repaid in connection with such Asset Sale;
(4) appropriate amounts to be determined by the Issuer or any
Restricted Subsidiary, as the case may be, as a reserve, in accordance
with GAAP, against any liabilities associated with such Asset Sale and
retained by the Issuer or any Restricted 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;
(5) any portion of the purchase price from an Asset Sale in
escrow, whether as a reserve for adjustment of the purchase price, for
satisfaction of indemnities in respect of such Asset Sale or otherwise
in connection with that Asset Sale; provided, however, that upon the
termination of that escrow, Net Cash Proceeds will be increased by any
portion of funds in the escrow that are released to the Issuer or any
Restricted Subsidiary; and
(6) all distributions and other payments required to be made to
minority interest holders or joint venture partners in Restricted
Subsidiaries.
"OBLIGATIONS" means all obligations for principal, premium,
interests, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Indebtedness.
"OFFERING MEMORANDUM" means the offering memorandum relating to the
offering of the Notes dated February 28, 2005.
14
"OFFICER" means the Chairman of the Board, the Chief Executive
Officer, the President, any Executive Vice President, Senior Vice President or
Vice President, the Treasurer or the Secretary of the Issuer.
"OFFICERS' CERTIFICATE" means a certificate signed on behalf of the
Issuer by two Officers of the Issuer, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Issuer, that meets the requirements set
forth in this Indenture.
"OPINION OF COUNSEL" means a written opinion from legal counsel who
is reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Issuer or the Trustee.
"PARI PASSU DEBT" means any Indebtedness of the Issuer that ranks
pari passu in right of payment with the Notes.
"PERMITTED INVESTMENTS" means:
(1) Investments by the Issuer or any Restricted Subsidiary in any
Person that is or will become immediately after such Investment a
Restricted Subsidiary or that will merge or consolidate into the
Issuer or a Restricted Subsidiary;
(2) Investments in the Issuer by any Restricted Subsidiary;
provided that any Indebtedness evidencing such Investment is unsecured
and subordinated, pursuant to a written agreement, to the Issuer's
obligations under the Notes and this Indenture;
(3) Investments in Permitted Joint Ventures in an aggregate
amount not to exceed the greater of (x) $10.0 million and (y) 5% of
the Issuer's Total Assets;
(4) Investments in cash and Cash Equivalents;
(5) loans and advances to employees and officers of the Issuer
and the Restricted Subsidiaries in the ordinary course of business for
bona fide business purposes not in excess of an aggregate of $1.0
million at any one time outstanding;
(6) Interest Swap Obligations entered into in the ordinary course
of the Issuer's or a Restricted Subsidiary's businesses and otherwise
in compliance with this Indenture;
(7) Investments represented by accounts receivable created or
acquired in the ordinary course of business;
(8) Investments existing on the Issue Date;
(9) Investments in the Notes otherwise permitted under this
Indenture;
15
(10) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of such trade creditors or
customers;
(11) Investments made by the Issuer or the Restricted
Subsidiaries as a result of consideration received in connection with
an Asset Sale made in compliance Section 4.06 or upon a disposition of
assets not constituting an Asset Sale;
(12) guarantees otherwise permitted under this Indenture;
(13) Investments acquired in exchange for the Qualified Capital
Stock of a Restricted Subsidiary of Issuer or Capital Stock of the
Issuer; and
(14) additional Investments not to exceed $10.0 million at any
one time outstanding.
"PERMITTED JOINT VENTURE" means any joint venture or other business
enterprise entered into between the Issuer or a Restricted Subsidiary and a
county, city, municipality, fire district, other governmental entity (or agency
thereof) or health services provider for the purpose of engaging in a Permitted
Business and approved by a majority of the disinterested members of the Board of
Directors of the Issuer.
"PERMITTED LIENS" means the following types of Liens:
(1) Liens securing the Credit Agreement or any other Credit
Facility;
(2) Liens for taxes, assessments or governmental charges or
claims either (A) not delinquent or (B) contested in good faith by
appropriate proceedings and, in each case, as to which the Issuer or
any Restricted Subsidiary shall have set aside on its books such
reserves as may be required pursuant to GAAP;
(3) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other
Liens imposed by law incurred in the ordinary course of business for
sums not yet delinquent or being contested in good faith, if such
reserve or other appropriate provision, if any, as shall be required
by GAAP shall have been made in respect thereof;
(4) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security, including any Lien
securing letters of credit issued in the ordinary course of business
consistent with past practice in connection therewith, or to secure
the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, contracts, performance and return-of-money bonds
and other similar obligations (exclusive of obligations for the
payment of borrowed money);
16
(5) judgment Liens not giving rise to an Event of Default so long
as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired;
(6) easements, rights-of-way, zoning restrictions and other
similar charges or encumbrances in respect of real property not
impairing in any material respect the ordinary conduct of the business
of the Issuer or any of the Restricted Subsidiaries;
(7) any interest or title of a lessor under any Capitalized Lease
Obligation; provided that such Liens do not extend to any property or
asset which is not leased property subject to such Capitalized Lease
Obligation;
(8) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect
of bankers' acceptances issued or created for the account of such
Person to facilitate the purchase, shipment or storage of such
inventory or other goods;
(9) Liens securing reimbursement obligations with respect to
commercial letters of credit or letters of credit permitted under
Section 4.03(b)(9) which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(10) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual or warranty
requirements of the Issuer or any of the Restricted Subsidiaries,
including rights of offset and set-off;
(11) Liens securing Interest Swap Obligations to the extent such
Interest Swap Obligations are otherwise permitted to be incurred under
this Indenture;
(12) Liens securing Purchase Money Indebtedness permitted
pursuant to Section 4.03(b)(6); provided, however, that in the case of
Purchase Money Indebtedness (a) the Indebtedness shall not exceed the
cost of such property or assets and shall not be secured by any
property or assets of the Issuer or any Restricted Subsidiary other
than the property and assets so acquired or constructed and (b) the
Lien securing such Indebtedness shall be created within 180 days of
such acquisition or construction or, in the case of a refinancing of
any Purchase Money Indebtedness, within 180 days of such refinancing;
(13) Liens securing Acquired Indebtedness (and any Indebtedness
which Refinances such Acquired Indebtedness) incurred in accordance
with Section 4.03; provided that
(A) such Liens secured the Acquired Indebtedness at the time
of and prior to the incurrence of such Acquired Indebtedness by
the Issuer or a Restricted Subsidiary and were not granted in
connection with, or in anticipation of, the incurrence of such
Acquired Indebtedness by the Issuer or a Restricted Subsidiary;
and
17
(B) such Liens do not extend to or cover any property or
assets of the Issuer or of any of the Restricted Subsidiaries
other than the property or assets that secured the Acquired
Indebtedness prior to the time such Indebtedness became Acquired
Indebtedness of the Issuer or a Restricted Subsidiary;
(14) Liens constituting licenses not otherwise prohibited under
the terms of this Indenture;
(15) Liens arising under this Indenture in favor of the Trustee
for the benefit of the Holders;
(16) Liens existing on the Issue Date;
(17) Liens in favor of the Issuer or a Restricted Subsidiary; and
(18) additional Liens not to exceed $2.0 million at any one time
outstanding.
"PERSON" means an individual, partnership, limited liability company,
corporation, unincorporated organization, trust or joint venture, or a
governmental agency or political subdivision thereof.
"PREFERRED STOCK" of any Person means any Capital Stock of such
Person that has preferential rights to any other Capital Stock of such Person
with respect to dividends or redemptions or upon liquidation.
"PURCHASE MONEY INDEBTEDNESS" means Indebtedness of the Issuer or any
Restricted Subsidiary incurred in the normal course of business for the purpose
of financing all or any part of the purchase price or the cost of installation,
construction or improvement of any property or equipment.
"QUALIFIED CAPITAL STOCK" means any Capital Stock that is not
Disqualified Capital Stock.
"REFERENT SUBSIDIARY" has the meaning set forth in the definition of
Investment.
"REFINANCE" means in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "REFINANCED" and "REFINANCING"
shall have correlative meanings.
"REFINANCING INDEBTEDNESS" means any Refinancing by the Issuer or any
Restricted Subsidiary of Indebtedness (x) entitled to be incurred pursuant to
Section 4.03(a) or (y) incurred pursuant to Section 4.03(b)(1) or 4.03(b)(3), in
each case that does not:
(1) result in an increase in the aggregate principal amount of
any Indebtedness of such Person as of the date of such proposed
Refinancing (except to the extent of the amount of any premium
required to be paid under the terms of the instrument governing such
Indebtedness and the amount of reasonable fees and expenses incurred
by the Issuer in connection with such Refinancing); or
18
(2) create Indebtedness with (A) a Weighted Average Life to
Maturity that is less than the Weighted Average Life to Maturity of
the Indebtedness being Refinanced or (B) a final maturity earlier than
the final maturity of the Indebtedness being Refinanced; provided that
(x) if such Indebtedness being Refinanced is Indebtedness of the
Issuer, then such Refinancing Indebtedness shall be Indebtedness
solely of the Issuer and (y) if such Indebtedness being Refinanced is
subordinate or junior in right of payment to the Notes, then such
Refinancing Indebtedness shall be subordinate to the Notes at least to
the same extent and in the same manner as the Indebtedness being
Refinanced.
"REPLACEMENT ASSETS" means tangible or intangible assets and property
(including improvements thereto) that will be used in a Permitted Business
(including, without limitation, the Capital Stock of a Person which becomes a
Restricted Subsidiary as a result of the acquisition of such Capital Stock by
the Issuer or a Restricted Subsidiary from any Person other than the Issuer or
an Affiliate of the Issuer).
"RESTRICTED SUBSIDIARY" means any Subsidiary of a Person that has not
been designated by the Board of Directors of such Person, by a Board Resolution
of such Person delivered to the Trustee.
"RURAL/METRO LLC" shall mean Rural/Metro Operating Company, LLC, a
Delaware limited liability company.
"S&P" has the meaning set forth in the definition of Cash
Equivalents.
"SALE AND LEASEBACK TRANSACTION" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Issuer or a Restricted Subsidiary of any property,
whether owned by the Issuer or any Restricted Subsidiary on the Issue Date or
later acquired, which has been or is to be sold or transferred by the Issuer or
such Restricted Subsidiary to such Person or to any other Person from whom funds
have been or are to be advanced on the security of such property.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor statute or statutes thereto, and the rules and regulations of the
Commission promulgated thereunder.
"SENIOR SUBORDINATED INDENTURE" means the indenture, to be dated
March 4, 2005 by and among Rural/Metro LLC, Rural/Metro (Delaware) Inc., the
Issuer, the other guarantors party thereto and Xxxxx Fargo Bank, N.A., as
trustee, governing the Senior Subordinated Notes.
"SENIOR SUBORDINATED NOTES" means the 9?% Senior Subordinated Notes
due 2015 issued by Rural/Metro Operating Company, LLC and Rural/Metro (Delaware)
Inc. pursuant to the Senior Subordinated Indenture together with any senior
subordinated notes issued in exchange therefor pursuant to the Senior
Subordinated Indenture.
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"SIGNIFICANT SUBSIDIARY" means (1) any Restricted Subsidiary that
would be a "significant subsidiary" as defined in Regulation S-X promulgated
pursuant to the Securities Act as such Regulation is in effect on the Issue Date
and (2) any Restricted Subsidiary that, when aggregated with all other
Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as
to which any event described in Sections 6.01(f) or 6.01(g) has occurred and is
continuing, would constitute a Significant Subsidiary under clause (1) of this
definition.
"STATED MATURITY" means, with respect to any installment of interest
or principal on any series of Indebtedness, the day on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and will not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"SUBSIDIARY," with respect to any Person, means
(1) 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
(2) any other Person of which at least a majority of the voting
interest under ordinary circumstances is at the time, directly or
indirectly, owned by such Person.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa
77bbbb) as in effect on the Issue Date.
"TOTAL ASSETS" means the total consolidated assets of the Issuer and
its Restricted Subsidiaries, as shown on the most recent balance sheet of the
Issuer.
"TRANSACTION DATE" has the meaning set forth in the definition of
Consolidated Fixed Charge Coverage Ratio.
"TREASURY RATE" means, as of the redemption date, the yield to
maturity of United States Treasury securities with a constant maturity (as
compiled and published in the most recent Federal Reserve Statistical Release
H.15(519) that has become publicly available at least two Business Days prior to
such redemption date (or, if such Statistical Release is no longer published,
any publicly available source of similar market data)) most nearly equal to the
period from the redemption date to March 15, 2010; provided, however, that if
the period from the redemption date to March 15, 2010 is less than one year, the
weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year will be used.
"TRUST OFFICER" means:
(1) any officer within the corporate trust department of the
Trustee, including any vice president, assistant vice president,
assistant treasurer, trust officer or any other officer of the Trustee
who customarily performs functions similar to those performed by the
Persons who at the time shall be such officers, respectively, or to
whom any corporate trust matter is referred because of such person's
knowledge of and familiarity with the particular subject, and
20
(2) who shall have direct responsibility for the administration
of this Indenture.
"TRUSTEE" means, initially, Xxxxx Fargo Bank, N.A., a national
banking association, in its capacity as Trustee hereunder, and its successors in
such capacity.
"UNIFORM COMMERCIAL CODE" means the New York Uniform Commercial Code
as in effect from time to time.
"UNRESTRICTED SUBSIDIARY" of any Person means
(1) any Subsidiary of such Person that at the time of
determination shall be or continue to be designated as such pursuant
to and in compliance with Section 4.17; and
(2) any Subsidiary of an Unrestricted Subsidiary.
"VOTING STOCK" with respect to any Person, means securities of any
class of Capital Stock of such Person entitling the holders thereof (whether at
all times or only so long as no senior class of stock or other relevant equity
interest has voting power by reason of any contingency) to vote in the election
of members of the Board of Directors of such Person.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (A) the then
outstanding aggregate principal amount of such Indebtedness into (B) the sum of
the total of the products obtained by multiplying (I) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (II)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
Section 1.02. Other Definitions.
Defined
Term in Section
---- ----------
"Affiliate Transaction"....................................... 4.07
"Appendix".................................................... Preamble
"Bankruptcy Law".............................................. 6.01
"Change of Control Offer"..................................... 4.08(a)
"Change of Control Payment"................................... 4.08(a)
"Change of Control Payment Date".............................. 4.08 (b)
"Clearstream"................................................. Appendix A
"Covenant Defeasance"......................................... 8.02(b)
"Custodian"................................................... 6.01
"Definitive Note"............................................. Appendix A
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Defined
Term in Section
---- ----------
"Depository".................................................. Appendix A
"Designation"................................................. 4.17
"Euroclear"................................................... Appendix A
"Event of Default"............................................ 6.01
"Exchange Notes".............................................. Preamble
"Existing Indebtedness"....................................... 4.03(b)(3)
"Global Notes Legend"......................................... Appendix A
"IAI"......................................................... Appendix A
"incorporated provision"...................................... 13.01
"incur"....................................................... 4.03(a)
"Initial Notes"............................................... Preamble
"Initial Purchasers".......................................... Appendix A
"Issuer" ..................................................... Preamble
"Legal Defeasance"............................................ 8.02
"Net Proceeds Offer".......................................... 4.06(b)
"Net Proceeds Offer Amount"................................... 4.06(b)
"Net Proceeds Offer Payment Date"............................. 4.06(b)
"Net Proceeds Offer Trigger Date"............................. 4.06(b)
"Notes"....................................................... Preamble
"Offerings"................................................... Preamble
"Original Notes".............................................. Preamble
"Paying Agent"................................................ 2.04
"Payment Blockage Notice"..................................... 10.03(a)
"payment default"............................................. 6.01(d)
"Permitted Business".......................................... 4.14
"Permitted Indebtedness"...................................... 4.03
"protected purchaser"......................................... 2.08
"Purchase Agreement".......................................... Appendix A
"QIB"......................................................... Appendix A
"Reference Date".............................................. 4.04
"Registered Exchange Offer"................................... Appendix A
"Registrar"................................................... 2.04
"Registration Default Damages"................................ Appendix A
"Registration Rights Agreement"............................... Appendix A
"Regulation S"................................................ Appendix A
"Regulation S Securities"..................................... Appendix A
"Restricted Notes Legend"..................................... Appendix A
"Restricted Payment".......................................... 4.04
"Restricted Period"........................................... Appendix A
"Rule 501".................................................... Appendix A
"Rule 144A"................................................... Appendix A
"Rule 144A Notes"............................................. Appendix A
"Securities Custodian"........................................ Appendix A
22
Defined
Term in Section
---- ----------
"Shelf Registration Statement"................................ Appendix A
"Subordinated Note Payments".................................. 10.02
"Surviving Entity"............................................ 5.01
"Transfer Restricted Notes"................................... Appendix A
"Unrestricted Definitive Note"................................ Appendix A
Section 1.03. Incorporation by Reference of Trust Indenture Act. This
Indenture incorporates by reference certain provisions of the TIA. The following
TIA terms have the following meanings:
"INDENTURE SECURITIES" means the Notes.
"OBLIGOR" on the indenture securities means the Issuer, and any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meanings assigned to them by such definitions.
Section 1.04. Rules of Construction. Unless the context otherwise
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "OR" is not exclusive;
(d) "INCLUDING" means including without limitation;
(e) words in the singular include the plural and words in the
plural include the singular;
(f) unsecured Indebtedness shall not be deemed to be subordinate
or junior to Secured Indebtedness merely by virtue of its nature as
unsecured Indebtedness;
(g) the principal amount of any non-interest bearing or other
discount security at any date shall be the principal amount thereof
that would be shown on a balance sheet of the Issuer dated such date
prepared in accordance with GAAP;
(h) the principal amount of any Preferred Stock shall be (i) the
maximum liquidation value of such Preferred Stock or (ii) the maximum
mandatory redemption or mandatory repurchase price with respect to
such Preferred Stock, whichever is greater;
23
(i) unless otherwise specified herein, all accounting terms used
herein shall be interpreted, all accounting determinations hereunder
shall be made, and all financial statements required to be delivered
hereunder shall be prepared in accordance with GAAP;
(j) "$" and "U.S. DOLLARS" each refer to United States dollars,
or such other money of the United States of America that at the time
of payment is legal tender for payment of public and private debts;
(k) whenever in this Indenture there is mentioned, in any
context, principal, interest or any other amount payable under or with
respect to any Notes, such mention shall be deemed to include mention
of the payment of Registration Default Damages, to the extent that, in
such context, Registration Default Damages are, were, or would be
payable in respect thereof;
ARTICLE 2
THE NOTES
Section 2.01. Amount of Notes; Issuable in Series. The aggregate
principal amount at maturity of Original Notes which may be authenticated and
delivered under this Indenture on the Issue Date is $93,500,000. The Notes may
be issued in one or more series. All Notes of any one series shall be
substantially identical except as to denomination.
The Issuer may from time to time after the Issue Date issue
Additional Notes under this Indenture in an unlimited principal amount at
maturity, so long as (i) the incurrence of the Indebtedness represented by such
Additional Notes is at such time permitted by Section 4.03 and (ii) such
Additional Notes are issued in compliance with the other applicable provisions
of this Indenture. With respect to any Additional Notes issued after the Issue
Date (except for Notes authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Notes pursuant to Sections 2.07,
2.08, 2.10, 2.11, 3.03(b), 4.08(e) or the Appendix), there shall be (a)
established in or pursuant to a resolution of the Board of Directors of the
Company and (b) (i) set forth or determined in the manner provided in an
Officers' Certificate or (ii) established in one or more indentures supplemental
hereto, prior to the issuance of such Additional Notes:
(1) whether such Additional Notes shall be issued as part of a
new or existing series of Notes and the title of such Additional Notes
(which shall distinguish the Additional Notes of the series from Notes
of any other series);
(2) the aggregate principal amount at maturity of such Additional
Notes which may be authenticated and delivered under this Indenture,
(3) the issue price and issuance date of such Additional Notes,
including the date from which interest on such Additional Notes shall
accrue;
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(4) if applicable, that such Additional Notes shall be issuable
in whole or in part in the form of one or more Global Notes and, in
such case, the respective depositaries for such Global Notes, the form
of any legend or legends which shall be borne by such Global Notes in
addition to or in lieu of those set forth in Exhibit A or Exhibit B
hereto and any circumstances in addition to or in lieu of those set
forth in Section 2.2 of the Appendix in which any such Global Notes
may be exchanged in whole or in part for Additional Notes registered,
or any transfer of such Global Notes in whole or in part may be
registered, in the name or names of Persons other than the depositary
for such Global Notes or a nominee thereof; and
(5) if applicable, that such Additional Notes that are not
Transfer Restricted Notes shall not be issued in the form of Initial
Notes as set forth in Exhibit A, but shall be issued in the form of
Exchange Notes as set forth in Exhibit B.
If any of the terms of any Additional Notes are established by action
taken pursuant to a resolution of the Board of Directors, a copy of an
appropriate record of such action shall be certified by the Secretary or any
Assistant Secretary of the Issuer and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate or the indenture supplemental hereto
setting forth the terms of the Additional Notes.
Section 2.02. Form and Dating. Provisions relating to the Initial
Notes and the Exchange Notes are set forth in the Appendix, which is hereby
incorporated in and expressly made a part of this Indenture. The (i) Initial
Notes and the Trustee's certificate of authentication and (ii) any Additional
Notes (if issued as Transfer Restricted Notes) and the Trustee's certificate of
authentication shall each be substantially in the form of Exhibit A hereto,
which is hereby incorporated in and expressly made a part of this Indenture..
The (i) Exchange Notes and the Trustee's certificate of authentication and (ii)
any Additional Notes issued other than as Transfer Restricted Notes and the
Trustee's certificate of authentication shall each be substantially in the form
of Exhibit B hereto, which is hereby incorporated in and expressly made a part
of this Indenture. The Notes may have notations, legends or endorsements
required by law, stock exchange rule, agreements to which the Issuer is subject,
if any, or usage (provided that any such notation, legend or endorsement is in a
form acceptable to the Issuer). Each Note shall be dated the date of its
authentication. The Notes shall be issuable only in registered form without
interest coupons and only in denominations of $1,000 and integral multiples of
$1,000 in excess thereof.
Section 2.03. Execution and Authentication. The Trustee shall
authenticate and make available for delivery upon a written order of the Issuer
signed by one Officer (a) Original Notes for original issue on the date hereof
in an aggregate principal amount at maturity of $93,500,000, (b) subject to the
terms of this Indenture, Additional Notes in an aggregate principal amount at
maturity to be determined at the time of issuance and specified therein and (c)
the Exchange Notes for issue in a Registered Exchange Offer pursuant to the
Registration Rights Agreement for a like principal amount at maturity of Initial
Notes exchanged pursuant thereto or otherwise pursuant to an effective
registration statement under the Securities Act. Such order shall specify the
amount of the Notes to be authenticated, the date on which the original issue of
Notes is to be authenticated and whether the Notes are to be Initial Notes or
Exchange Notes. Notwithstanding anything to the contrary in this Indenture or
the Appendix, any issuance of Additional Notes after the Issue Date shall be in
25
a principal amount at maturity of at least $1,000 and integral multiples of
$1,000 in excess thereof, whether such Additional Notes are of the same or a
different series than the Original Notes. One Officer shall sign the Notes for
the Issuer by manual or facsimile signature.
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.
A Note shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Note. The
signature shall be conclusive evidence that the Note has been authenticated
under this Indenture.
The Trustee may appoint one or more authenticating agents reasonably
acceptable to the Issuer to authenticate the Notes. Any such appointment shall
be evidenced by an instrument signed by a Trust Officer, a copy of which shall
be furnished to the Issuer. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as any
Registrar, Paying Agent or agent for service of notices and demands.
The Trustee is hereby authorized to enter into a letter of
representations with the Depository in the form provided by the Issuer and to
act in accordance with such letter.
Section 2.04. Registrar and Paying Agent. (a) The Issuer shall
maintain (i) an office or agency where Notes may be presented for registration
of transfer or for exchange (the "REGISTRAR") and (ii) an office or agency where
Notes may be presented for payment (the "PAYING AGENT"). The Registrar shall
keep a register of the Notes and of their transfer and exchange. The Issuer may
have one or more co-registrars and one or more additional paying agents. The
term "Registrar" includes any co-registrars. The Issuer initially appoints the
Trustee as (i) Registrar and Paying Agent in connection with the Notes and (ii)
the Securities Custodian with respect to the Global Notes. (b).....The Issuer
shall enter into an appropriate agency agreement with any Registrar or Paying
Agent not a party to this Indenture, which shall incorporate the terms of the
TIA. The agreement shall implement the provisions of this Indenture that relate
to such agent. The Issuer shall notify the Trustee of the name and address of
any such agent. If the Issuer fail to maintain a Registrar or Paying Agent, the
Trustee shall act as such and shall be entitled to appropriate compensation
therefor pursuant to Section 7.07. The Issuer or any of its Subsidiaries may act
as Paying Agent or Registrar.
(c) The Issuer may remove any Registrar or Paying Agent upon written
notice to such Registrar or Paying Agent and to the Trustee; provided, however,
that no such removal shall become effective until (i) if applicable, acceptance
of an appointment by a successor as evidenced by an appropriate agreement
entered into by the Issuer and such successor Registrar or Paying Agent, as the
case may be, and delivered to the Trustee or (ii) notification to the Trustee
that the Trustee shall serve as Registrar or Paying Agent until the appointment
26
of a successor in accordance with clause (i) above. The Registrar or Paying
Agent may resign at any time upon written notice to the Issuer and the Trustee;
provided, however, that the Trustee may resign as Paying Agent or Registrar only
if the Trustee also resigns as Trustee in accordance with Section 7.08.
Section 2.05. Paying Agent to Hold Money in Trust. Prior to each due
date of the principal of and interest on any Note, the Issuer shall deposit with
each Paying Agent (or if the Issuer or a Subsidiary is acting as Paying Agent,
segregate and hold in trust for the benefit of the Persons entitled thereto) a
sum sufficient to pay such principal and interest when so becoming due. The
Issuer shall require each Paying Agent (other than the Trustee) to agree in
writing that a Paying Agent shall hold in trust for the benefit of Holders or
the Trustee all money held by a Paying Agent for the payment of principal of and
interest on the Notes, and shall notify the Trustee of any default by the Issuer
in making any such payment. If the Issuer or a Subsidiary of the Issuer acts as
Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it in trust for the benefit of the Persons entitled thereto. The Issuer at any
time may require a Paying Agent to pay all money held by it to the Trustee and
to account for any funds disbursed by such Paying Agent. Upon complying with
this Section, a Paying Agent shall have no further liability for the money
delivered to the Trustee.
Section 2.06. Holder Lists. The Trustee shall preserve in as current
a form as is reasonably practicable the most recent list available to it of the
names and addresses of Holders. If the Trustee is not the Registrar, the Issuer
shall furnish, or cause the Registrar to furnish, to the Trustee, in writing at
least five Business Days before each interest payment date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of
Holders.
Section 2.07. Transfer and Exchange The Notes shall be issued in
registered form and shall be transferable only upon the surrender of a Note for
registration of transfer and in compliance with the Appendix. When a Note is
presented to the Registrar with a request to register a transfer, the Registrar
shall register the transfer as requested if its requirements therefor are met.
When Notes are presented to the Registrar with a request to exchange them for an
equal principal amount at maturity of Notes of other denominations, the
Registrar shall make the exchange as requested if the same requirements are met.
To permit registration of transfers and exchanges, the Issuer shall execute and
the Trustee shall authenticate Notes at the Registrar's request. The Issuer may
require payment of a sum sufficient to pay all taxes, assessments or other
governmental charges in connection with any transfer or exchange pursuant to
this Section. The Issuer shall not be required to make, and the Registrar need
not register, transfers or exchanges of Notes selected for redemption (except,
in the case of Notes to be redeemed in part, the portion thereof not to be
redeemed) or of any Notes for a period of 15 days before a selection of Notes to
be redeemed. Prior to the due presentation for registration of transfer of any
Notes, the Issuer, the Trustee, each Paying Agent and the 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 the Issuer, the Trustee, a Paying Agent or the Registrar
shall be affected by notice to the contrary.
27
Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such beneficial interest, agree that transfers of beneficial
interests in such Global Note may be effected only through a book-entry system
maintained by (a) the Holder of such Global Note (or its agent) or (b) any
Holder of a beneficial interest in such Global Note, and that ownership of a
beneficial interest in such Global Note shall be required to be reflected in a
book entry.
All Notes issued upon any transfer or exchange pursuant to the terms
of this Indenture shall evidence the same debt and shall be entitled to the same
benefits under this Indenture as the Notes surrendered upon such transfer or
exchange.
Section 2.08. Replacement Notes. If a mutilated Note is surrendered
to the Registrar or if the Holder of a Note claims that the Note has been lost,
destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall
authenticate a replacement Note if the requirements of Section 8-405 of the
Uniform Commercial Code are met, such that the Holder (a) satisfies the Issuer
or the Trustee within a reasonable time after such Holder has notice of such
loss, destruction or wrongful taking and the Registrar does not register a
transfer prior to receiving such notification, (b) makes such request to the
Issuer or the Trustee prior to the Note being acquired by a protected purchaser
as defined in Section 8-303 of the Uniform Commercial Code (a "PROTECTED
PURCHASER") and (c) satisfies any other reasonable requirements of the Trustee.
If required by the Trustee or the Issuer, such Holder shall furnish an indemnity
bond sufficient in the judgment of the Trustee to protect the Issuer, the
Trustee, a Paying Agent and the Registrar from any loss that any of them may
suffer if a Note is replaced. The Issuer and the Trustee may charge the Holder
for their expenses in replacing a Note (including without limitation, attorneys'
fees and disbursements in replacing such Note). In the event any such mutilated,
lost, destroyed or wrongfully taken Note has become or is about to become due
and payable, the Issuer in its discretion may pay such Note instead of issuing a
new Note in replacement thereof. Every replacement Note is an additional
obligation of the Issuer.
The provisions of this Section 2.08 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, lost, destroyed or wrongfully taken Notes.
Section 2.09. Outstanding Notes. (a) Notes outstanding at any time
are all Notes that have been authenticated by the Trustee except for:
(1) Notes cancelled by the Trustee or delivered to it for
cancellation;
(2) any Note which has been replaced pursuant to Section 2.08
unless and until the Trustee and the Issuer receive proof satisfactory
to them that the replaced Note is held by a protected purchaser; and
(3) on or after the maturity date or any redemption date or date
for purchase of the Notes pursuant to an offer to purchase, those
Notes payable or to be redeemed or purchased on that date for which
the Trustee (or Paying Agent, other than the Issuer or an Affiliate of
the Issuer) holds money sufficient to pay all amounts then due.
(b) A Note does not cease to be outstanding because the Issuer or one
of its Affiliates holds the Note, provided that in determining whether the
Holders of the requisite principal amount at maturity of the outstanding Notes
have given or taken any request, demand, authorization, direction, notice,
28
consent, waiver or other action hereunder, Notes owned by the Issuer or any
Affiliate of the Issuer will be disregarded and deemed not to be outstanding,
(it being understood that in determining whether the Trustee is protected in
relying upon any such request, demand, authorization, direction, notice,
consent, waiver or other action, only Notes which the Trustee knows to be so
owned will be so disregarded).
(c) If a Paying Agent segregates and holds in trust, in accordance
with this Indenture, on a redemption date or maturity date, money sufficient to
pay all principal and interest payable on that date with respect to the Notes
(or portions thereof) to be redeemed or maturing, as the case may be, and no
Paying Agent is prohibited from paying such money to the Holders on that date
pursuant to the terms of this Indenture, then on and after that date such Notes
(or portions thereof) will cease to be outstanding and interest on them ceases
to accrue.
Section 2.10. Temporary Notes. In the event that Definitive Notes are
to be issued under the terms of this Indenture, until such Definitive Notes are
ready for delivery, the Issuer may prepare and the Trustee shall authenticate
temporary Notes. Temporary Notes shall be substantially in the form of
Definitive Notes but may have variations that the Issuer consider appropriate
for temporary Notes. Without unreasonable delay, the Issuer shall prepare and
the Trustee shall authenticate Definitive Notes and make them available for
delivery in exchange for temporary Notes upon surrender of such temporary Notes
at the office or agency of the Issuer, without charge to the Holder. Until such
exchange, temporary Notes shall be entitled to the same rights, benefits and
privileges as Definitive Notes.
Section 2.11. Cancellation. The Issuer at any time may deliver Notes
to the Trustee for cancellation. The Registrar and each Paying Agent shall
forward to the Trustee any Notes surrendered to them for registration of
transfer, exchange or payment. The Trustee and no one else shall cancel all
Notes surrendered for registration of transfer, exchange, payment or
cancellation and shall dispose of canceled Notes in accordance with its
customary procedures or deliver canceled Notes to the Issuer pursuant to written
direction by an Officer. The Issuer may not issue new Notes to replace Notes
they have redeemed, paid or delivered to the Trustee for cancellation. The
Trustee shall not authenticate Notes in place of canceled Notes other than
pursuant to the terms of this Indenture.
Section 2.12. Defaulted Interest. If the Issuer defaults in a payment
of interest on the Notes, the Issuer shall pay the defaulted interest then borne
by the Notes (plus interest on such defaulted interest to the extent lawful), in
any lawful manner. The Issuer may pay the defaulted interest to the Persons who
are Holders on a subsequent special record date. The Issuer shall fix or cause
to be fixed any such special record date and payment date to the reasonable
satisfaction of the Trustee and shall promptly mail or cause to be mailed to
each affected Holder a notice that states the special record date, the payment
date and the amount of defaulted interest to be paid.
Section 2.13. CUSIP Numbers, ISINs, etc. The Issuer in issuing the
Notes may use CUSIP numbers, ISINs and "Common Code" numbers (if then generally
in use) and, if so, the Trustee shall use CUSIP numbers, ISINs and "Common Code"
numbers in notices of redemption as a convenience to Holders; provided, however,
that any such notice may state that no representation is made as to the
correctness of such numbers, either as printed on the Notes or as contained in
any notice of a redemption that reliance may be placed only on the other
identification numbers printed on the Notes and that any such redemption shall
not be affected by any defect in or omission of such numbers. The Issuer shall
advise the Trustee of any change in the CUSIP numbers, ISINs and "Common Code"
numbers.
29
ARTICLE 3
REDEMPTION
Section 3.01. Optional Redemption. (a) The Notes will be redeemable,
at the Issuer's option, in whole at any time or in part from time to time, on
and after March 15, 2010 at the following redemption prices (expressed as
percentages of the principal amount at maturity thereof) if redeemed during the
twelve-month period commencing on March 15 of the applicable year set forth
below, plus, in each case, accrued and unpaid interest, if any, to the date of
redemption:
YEAR PERCENTAGE
---- ----------
2010..................................................... 106.375%
2011..................................................... 104.250%
2012..................................................... 102.125%
2013 and thereafter...................................... 100.000%
(b) In addition, prior to March 15, 2010, the Issuer may redeem the
Notes at its option, in whole or in part from time to time, upon not less than
30 nor more than 60 days' prior notice mailed by first-class mail to each
holder's registered address, at a redemption price equal to 100% of the Accreted
Value of the Notes redeemed plus the Applicable Premium as of, and accrued and
unpaid interest and Registration Default Damages, if any, to the applicable
redemption date (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date).
Section 3.02. Redemption with Proceeds of Equity Offerings.
Notwithstanding the foregoing, at any time, or from time to time, on or prior to
March 15, 2008, the Issuer may, at its option, use all or any portion of the net
cash proceeds of one or more Equity Offerings to redeem up to 35% of the
aggregate principal amount at maturity of the Notes issued at a redemption price
equal to 112.75% of the Accreted Value thereof plus accrued and unpaid interest,
if any, to the date of redemption; provided that at least 65% of the aggregate
principal amount at maturity of Notes originally issued remains outstanding
immediately after any such redemption. In order to effect the foregoing
redemption with the proceeds of any Equity Offering, the Issuer shall consummate
such redemption not more than 90 days after the consummation of any such Equity
Offering.
Section 3.03. Method and Effect of Redemption. (a) If the Issuer
elects to redeem Notes, it must notify the Trustee of the redemption date, the
principal amount at maturity of Notes to be redeemed and the redemption price by
delivering an Officers' Certificate and an Opinion of Counsel, to the effect
that such redemption shall comply with the conditions set forth in this Article
30
3, at least 40 but no more than 60 days before the redemption date (unless a
shorter period is satisfactory to the Trustee). If less than all the Notes are
to be redeemed at any time, the Trustee shall select the Notes to be redeemed in
compliance with the principal national securities exchange, if any, on which the
Notes are listed, or if such Notes are not so listed, on a pro rata basis, by
lot or by any other method the Trustee in its sole discretion deems fair and
appropriate; provided, that no Notes of a principal amount at maturity of $1,000
or less shall be redeemed in part; and provided, further, that if a partial
redemption is made with the proceeds of an Equity Offering, selection of the
Notes or portions thereof for redemption shall be made by the Trustee only on a
pro rata basis or on as nearly a pro rata basis as is practicable (subject to
DTC procedures), unless such method is otherwise prohibited. The Trustee shall
notify the Issuer promptly of the Notes or portions of Notes to be called for
redemption. Any such notice may be cancelled at any time prior to notice of such
redemption being mailed to any Holder and shall thereby be void and of no
effect. Notice of redemption must be sent by the Issuer or at the Issuer's
request, by the Trustee in the name and at the expense of the Issuer, to Holders
whose Notes are to be redeemed at least 30 but not more than 60 days before the
redemption date, except that redemption notices may be mailed more than 60 days
prior to a redemption date if the notice is issued in connection with Section
8.01 or Section 8.02 of this Indenture. The notice of redemption will identify
the Notes to be redeemed and will include, state or be governed by the
following:
(i) the redemption date;
(ii) the redemption price including the portion thereof
representing any accrued interest or Registration Default Damages, if
any;
(iii) the names and addresses of the Paying Agents where Notes
are to be surrendered;
(iv) notes called for redemption must be surrendered to a Paying
Agent in order to collect the redemption price and any accrued
interest or Registration Default Damages;
(v) on the redemption date the redemption price will become due
and payable on Notes called for redemption and Accreted Value will
cease to increase, or interest will cease to accrue, as the case may
be, on Notes and portions thereof called for redemption, on and after
the redemption date;
(vi) if fewer than all the outstanding Notes are to be redeemed,
the certificate numbers and principal amounts at maturity of the
particular Notes to be redeemed, the aggregate principal amount at
maturity of Notes to be redeemed and the aggregate principal amount at
maturity of Notes to be outstanding after such partial redemption;
(vii) if any Note is to be redeemed in part only, the portion of
the principal amount at maturity of that Note that is to be redeemed;
31
(viii) if any Note is to be redeemed in part, on and after the
redemption date, upon surrender of such Note, new Notes equal in
principal amount at maturity to the unredeemed part will be issued;
(ix) the CUSIP number, ISIN and/or "Common Code" number, if any,
printed on the Notes being redeemed; and
(x) that no representation is made as to the correctness or
accuracy of the CUSIP number or CINS number, or "common number" listed
in such notice or printed on the Notes and that the Holder should rely
only on the other identification numbers printed on the Notes.
(b) Once notice of redemption pursuant to this Section 3.03 is mailed
to the Holders, Notes called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon surrender
to any Paying Agent, the Issuer shall redeem such Notes at the redemption price,
plus accrued and unpaid interest and Registration Default Damages, if any,
through the redemption date. Failure to give notice or any defect in the notice
to any Holder shall not affect the validity of the notice to any other Holder.
Upon surrender of any Note redeemed in part, the holder will receive a new note
equal in principal amount to the unredeemed portion of the surrendered Note.
Section 3.04. Deposit of Redemption Price. Prior to 10:00 a.m., New
York City time, on the redemption date, the Issuer shall deposit with the Paying
Agent (or, if the Issuer or a Subsidiary is a Paying Agent, shall segregate and
hold in trust) money sufficient to pay the redemption price of and accrued
interest on all Notes or portions thereof to be redeemed on that date other than
Notes or portions of Notes called for redemption that have been delivered by the
Issuer to the Trustee for cancellation. On and after the redemption date,
interest shall cease to accrue on Notes or portions thereof called for
redemption so long as the Issuer has deposited with the Paying Agent funds
sufficient to pay the principal of, plus accrued and unpaid interest on, the
Notes to be redeemed, unless a Paying Agent is prohibited from making such
payment pursuant to the terms of this Indenture; provided, however, that if the
redemption date is after a regular record date and on or prior to a cash
interest payment date, the accrued interest and Registration Default Damages, if
any, shall be payable to the Holder of the redeemed Notes registered on the
relevant record date.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes. The Issuer agrees to pay the
principal of and interest on the Notes on the dates and in the manner provided
in the Notes and this Indenture. Not later than 10:00 A.M. (New York City time)
on the due date of any principal of or interest on any Notes, or any redemption
or purchase price of the Notes, the Issuer will deposit with the Trustee (or
Paying Agent) money in immediately available funds sufficient to pay such
amounts, provided that if the Issuer is acting as Paying Agent, they will, on or
before each due date, segregate and hold in a separate trust fund for the
benefit of the Holders a sum of money sufficient to pay such amounts until paid
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to such Holders or otherwise disposed of as provided in this Indenture. In each
case the Issuer will promptly notify the Trustee of its compliance with this
paragraph. An installment of principal or interest will be considered paid on
the date due if the Trustee (or Paying Agent, other than the Issuer) holds on
that date money designated for and sufficient to pay the installment. If the
Issuer acts as Paying Agent, an installment of principal or interest will be
considered paid on the due date only if paid to the Holders.
The Issuer shall pay interest on overdue principal at the rate
specified therefor in the Notes, and it shall pay interest on overdue
installments of interest at the same rate borne by the Notes to the extent
lawful.
Section 4.02. Reports and Other Information. Notwithstanding that the
Issuer may not be subject to the reporting requirements of Section 13 or 15(d)
of the Exchange Act, or otherwise report on an annual and quarterly basis on
forms provided for such annual and quarterly reporting pursuant to rules and
regulations promulgated by the Commission, the Issuer will furnish to the
Holders and the Trustee:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q
and 10-K if the Issuer was required to file such Forms, including a
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" that describes the financial condition and
results of operations of the Issuer and its consolidated Subsidiaries
(showing in reasonable detail, either on the face of the financial
statements or in the footnotes thereto and in Management's Discussion
and Analysis of Financial Condition and Results of Operations, the
financial condition and results of operations of the Issuer and its
Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Issuer,
if any) and, with respect to the annual information only, a report
thereon by the Issuer's certified independent accounts, in each case
within the time periods in which such report would be required to be
filed as specified in the Commission's rules and regulations; and
(2) all current reports that would be required to be filed with
the Commission on Form 8-K if the Issuer was required to file such
reports, in each case within the time periods in which such report
would be required to be filed as specified in the Commission's rules
and regulations.
In addition, following the consummation of the Registered Exchange
Offer contemplated by the Registration Rights Agreement, whether or not required
by the rules and regulations of the Commission, the Issuer will file a copy of
all such information and reports with the Commission for public availability
within the time periods specified in the Commission's rules and regulations
(unless the Commission will not accept such a filing) and make such information
available to securities analysts and prospective investors upon request.
In addition, the Issuer has agreed that, for so long as any Notes
remain outstanding, it will furnish to the Holders and to securities analysts
and prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
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Section 4.03. Limitation on Incurrence of Indebtedness and Issuance
of Preferred Stock. (a) The Issuer will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee, acquire, become liable, contingently or otherwise, with
respect to, or otherwise become responsible for payment of (collectively,
"INCUR") any Indebtedness (including Acquired Indebtedness) and the Issuer will
not permit any of its Restricted Subsidiaries to issue any Preferred Stock;
provided, however, that (i) Parent and its Restricted Subsidiaries (other than
Rural/Metro LLC and its Restricted Subsidiaries) may incur Indebtedness
(including, without limitation, Acquired Indebtedness) if the Consolidated Fixed
Charge Coverage Ratio for Parent's most recently ended four fiscal quarters for
which financial statements are available immediately preceding the date on which
such additional Indebtedness is incurred would be at least 2.0 to 1.0 and (ii)
Rural/Metro LLC and any of its Restricted Subsidiaries may incur Indebtedness
(including, without limitation, Acquired Indebtedness) or issue Preferred Stock
if on the date of the incurrence of such Indebtedness or the issuance of such
Preferred Stock, after giving effect to the incurrence or issuance thereof, the
Consolidated Fixed Charge Coverage Ratio of Rural/Metro LLC would be at least
2.0 to 1.0.
(b) The limitations set forth in Section 4.03(a) shall not prohibit
the incurrence of any of the following items of Indebtedness or the issuance any
of the following items of Preferred Stock, as applicable (collectively,
"PERMITTED INDEBTEDNESS"):
(1) Indebtedness under the Notes issued in the Offerings in an
aggregate principal amount at maturity not to exceed $93.5 million;
(2) Indebtedness of the Issuer and its Restricted Subsidiaries
incurred pursuant to the Credit Facilities in an aggregate principal
amount at any time outstanding not to exceed $200.0 million less the
amount of any such Indebtedness permanently retired with the Net Cash
Proceeds from any Asset Sale applied from and after the Issue Date to
reduce the outstanding amounts pursuant to Section 4.06;
(3) other Indebtedness of the Issuer and its Restricted
Subsidiaries outstanding on the Issue Date (including, without
limitation, Indebtedness under the Senior Subordinated Notes issued in
the Offerings and guarantees thereof) after giving effect to the
application of the proceeds of the Offerings, reduced by the amount of
any scheduled amortization payments or mandatory prepayments when
actually paid or permanent reductions thereon ("EXISTING
INDEBTEDNESS");
(4) Interest Swap Obligations of the Issuer or any Restricted
Subsidiary covering Indebtedness of the Issuer or such Restricted
Subsidiary, as the case may be; provided, however, that such Interest
Swap Obligations are entered into to protect the Issuer or such
Restricted Subsidiaries from fluctuations in interest rates on
Indebtedness incurred in accordance with this Section 4.03; provided
further, however, that the notional principal amount of such Interest
Swap Obligations does not exceed the principal amount of the
Indebtedness to which such Interest Swap Obligations relates;
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(5) Indebtedness of a Restricted Subsidiary to the Issuer or
another Restricted Subsidiary for so long as such Indebtedness is held
by the Issuer or a Restricted Subsidiary, in each case subject to no
Lien held by a Person other than the Issuer or a Restricted
Subsidiary; provided that if as of any date any Person other than the
Issuer or a Restricted Subsidiary owns or holds any such Indebtedness
or holds a Lien in respect of such Indebtedness, such Restricted
Subsidiary shall be deemed to have incurred Indebtedness not
constituting Permitted Indebtedness;
(6) (A) Purchase Money Indebtedness, (B) Capital Lease
Obligations, and (C) Indebtedness incurred in connection with an Asset
Acquisition (including Acquired Indebtedness), in each case incurred
by the Issuer or any Restricted Subsidiary, in an aggregate principal
amount outstanding at any time not to exceed $15.0 million;
(7) Indebtedness constituting an agreement or commitment to pay a
dividend that has been declared or otherwise to make a payment or
distribution as described in Section 4.04(a)(i);
(8) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business;
provided, however, that such Indebtedness is extinguished within two
(2) Business Days after incurrence;
(9) Indebtedness of the Issuer or any of its Restricted
Subsidiaries in respect of performance bonds, notary bonds, bankers'
acceptances, workers' compensation claims, surety or appeal bonds,
payment obligations in connection with self-insurance or similar
obligations, and bank overdrafts (and, in each of the foregoing cases,
letters of credit in respect thereof) in the ordinary course of
business;
(10) Refinancing Indebtedness;
(11) guarantees of Indebtedness permitted under this Indenture;
(12) customary earn-out and similar obligations incurred in
connection with agreements to acquire assets or properties; and
(13) additional Indebtedness of the Issuer and the Restricted
Subsidiaries in an aggregate principal amount not to exceed $10.0
million at any one time outstanding.
(c) For purposes of determining compliance with this Section 4.03:
(1) in the event that an item of Indebtedness or Preferred Stock
meets the criteria of more than one of the categories of Indebtedness
or Preferred Stock described in clauses (1) through (13) of Section
4.03(b), or is entitled to be incurred pursuant to Section 4.03(a),
the Issuer shall, in its sole discretion, classify such item of
Indebtedness and may, in its sole discretion, subject to clause (2)
below, divide and classify such item of Indebtedness or Preferred
Stock into more than one of such categories on the date of its
incurrence, or later classify, reclassify or divide all or a portion
of such item of Indebtedness or Preferred Stock, in any manner that
complies with this Section 4.03;
35
(2) Indebtedness under the Credit Agreement outstanding on the
Issue Date will be deemed to have been incurred pursuant to clause (2)
of Section 4.03(b) and the Issuer will not be permitted to reclassify
any portion of such Indebtedness thereafter; and
(3) accrual of interest, accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the
form of additional Indebtedness with the same terms and the payment of
dividends on Disqualified Capital Stock or Preferred Stock in the form
of additional shares of the same class of Disqualified Capital Stock
or Preferred Stock will not be deemed to be an incurrence of
Indebtedness or an issuance of Preferred Stock for purposes of this
Section 4.03.
Section 4.04. Limitation on Restricted Payments. The Issuer will not,
and will not cause or permit any of the Restricted Subsidiaries to, directly or
indirectly:
(a) declare or pay any dividend or make any distribution (other than
(i) dividends or distributions payable in Qualified Capital Stock of the Issuer
and (ii) in the case of Restricted Subsidiaries, dividends or distributions to
the Issuer or any other Restricted Subsidiary and pro rata dividends or
distributions payable to the other holders of the same class of Capital Stock of
such Restricted Subsidiary) on or in respect of shares of its Capital Stock to
holders of such Capital Stock;
(b) purchase, redeem or otherwise acquire or retire for value any
Capital Stock of the Issuer;
(c) make any principal payment on, purchase, defease, redeem, prepay
or otherwise acquire or retire for value, prior to any scheduled final maturity,
scheduled repayment or scheduled sinking fund payment, any Indebtedness of the
Issuer that is subordinate or junior in right of payment to the Notes (other
than the Senior Subordinated Notes); or
(d) make any Investment (other than Permitted Investments)
(each of the foregoing actions set forth in clauses (a), (b), (c) and (d) being
referred to as a "RESTRICTED PAYMENT"), if at the time of such Restricted
Payment or immediately after giving effect thereto:
(1) a Default or an Event of Default shall have occurred and be
continuing;
(2) (A) with respect to a Restricted Payment by the Issuer or any
of its Restricted Subsidiaries (other than Rural/Metro LLC or any of
its Restricted Subsidiaries), the Issuer is not able to incur at least
$1.00 of additional Indebtedness pursuant to Section 4.03(a)(i) or (B)
with respect to a Restricted Payment by Rural/Metro LLC or any of its
Restricted Subsidiaries, it is not able to incur at least $1.00 of
additional Indebtedness pursuant to Section 4.03(a)(ii); or
36
(3) the aggregate amount of Restricted Payments (including such
proposed Restricted Payment) made after the Issue Date (the amount
expended for such purpose, if other than in cash, being the Fair
Market Value of such property) shall exceed the sum of:
(w) 50% of the cumulative Consolidated Net Income (or if
cumulative Consolidated Net Income shall be a loss, minus 100% of
such loss) of the Issuer earned during the period beginning on
the first day of the first full fiscal quarter following the
Issue Date and ending on the last date of the most recent fiscal
quarter for which financial statements are available prior to the
date of such Restricted Payment (the "REFERENCE DATE") (treating
such period as a single accounting period); plus
(x) 100% of the aggregate net proceeds received by the
Issuer from any Person (other than a Subsidiary of the Issuer)
subsequent to the Issue Date and on or prior to the Reference
Date from the issuance and sale of Qualified Capital Stock of the
Issuer's or as a contribution to the equity capital of the Issuer
by any holder of the Issuer's Capital Stock; plus
(y) without duplication of any amounts included in clause
(3)(x) above, 100% of the net proceeds received by the Issuer
from any Person (other than a Subsidiary of the Issuer)
subsequent to the Issue Date and on or prior to the Reference
Date from the issuance and sale of debt securities or
Disqualified Capital Stock of the Issuer that has been converted
into Qualified Capital Stock of the Issuer; plus
(z) without duplication, the sum of:
(1) the aggregate amount returned in cash on or with
respect to Investments (other than Permitted Investments)
made subsequent to the Issue Date whether through interest
payments, principal payments, dividends or other
distributions or payments (to the extent not included in
Consolidated Net Income);
(2) the net cash proceeds received by the Issuer or any
of the Restricted Subsidiaries from the disposition of all
or any portion of such Investments (other than to a
Subsidiary of the Issuer) (to the extent not included in
Consolidated Net Income); and
(3) upon Revocation of the status of an Unrestricted
Subsidiary as an Unrestricted Subsidiary, the Fair Market
Value of the Issuer's and the Restricted Subsidiaries'
Investment in such Subsidiary;
provided, however, that the sum of clauses (1), (2) and (3) above
shall not exceed the aggregate amount of all such Investments made subsequent to
the Issue Date.
(e) Notwithstanding the foregoing, the provisions set forth in the
immediately preceding paragraph do not prohibit:
37
(1) the payment of any dividend within 60 days after the date of
declaration of such dividend if the dividend would have been permitted
on the date of declaration;
(2) the acquisition of any shares of Capital Stock of the Issuer,
either (i) solely in exchange for shares of Qualified Capital Stock of
the Issuer or (ii) through the application of net proceeds of a
substantially concurrent sale for cash (other than to a Subsidiary of
the Issuer) of shares of Qualified Capital Stock of the Issuer;
(3) the acquisition of any Indebtedness of the Issuer that is
subordinate or junior in right of payment to the Notes either (i)
solely in exchange for shares of Qualified Capital Stock of the
Issuer, or (ii) through the application of the net proceeds of a
substantially concurrent sale for cash (other than to a Subsidiary of
the Issuer) of (a) shares of Qualified Capital Stock of the Issuer or
(b) Refinancing Indebtedness;
(4) if no Default or Event of Default shall have occurred and be
continuing, payments to redeem Capital Stock of the Issuer from
employees of the Issuer or any of its Subsidiaries or their authorized
representatives, upon the death, disability or termination of
employment of such employees, in an aggregate amount for all such
redemptions and repurchases pursuant to this clause (4) not to exceed
$1.0 million in any calendar year; provided that amounts not utilized
in any calendar year may be carried forward to be utilized in a
subsequent calendar year;
(5) for repurchases of Capital Stock of the Issuer which are
deemed to occur upon the cashless exercise of stock options or
warrants if such Capital Stock represents a portion of the exercise
price of such options or warrants;
(6) the repurchase, redemption or other acquisition or retirement
for value of Indebtedness subordinated in right of payment pursuant to
Sections 4.06 and 4.08; and
(7) other Restricted Payments pursuant to this clause (7) not to
exceed $5.0 million in the aggregate from and after the Issue Date.
In determining the aggregate amount of Restricted Payments made
subsequent to the Issue Date in accordance with clause (3) of Section 4.04(a),
amounts expended pursuant to clauses (1), (2)(ii), (3)(ii)(a), (4) and (6) shall
be included in such calculation.
Section 4.05. Dividend and Other Payment Restrictions Affecting
Subsidiaries. Issuer will not, and will not cause or permit any of the
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
permit to exist or become effective, any consensual encumbrance or restriction
on the ability of any Restricted Subsidiary to:
38
(a) pay dividends or make any other distributions on or in respect of
its Capital Stock;
(b) make loans or advances or to pay any Indebtedness or other
obligation owed to the Issuer or any other Restricted Subsidiary; or
(c) transfer any of its property or assets to the Issuer or any other
Restricted Subsidiary,
except for such encumbrances or restrictions existing under or by reasons of:
(1) the Credit Agreement, the Senior Subordinated Indenture and
the Senior Subordinated Notes and the guarantees thereof and any other
agreements existing on the Issue Date to the extent and in the manner
such agreements are in effect on the Issue Date and any amendments,
restatements, renewals, replacements or refinancings thereof;
provided, however, that the encumbrances and restrictions contained in
any such amendments, restatements, renewals, replacements or
refinancings are not, taken as a whole, materially more restrictive
than the encumbrances or restrictions contained in such agreements on
the Issue Date;
(2) this Indenture, the Notes or in any indenture relating to
Pari Passu Debt entered into after the Issue Date and incurred in
compliance with the terms of this Indenture; provided that the
encumbrances or restrictions in such agreements are not materially
more restrictive than those contained in this Indenture;
(3) restrictions on cash or other deposits or net worth imposed
by agreements entered into in the ordinary course of business;
(4) customary provisions in joint venture agreements and other
similar agreements;
(5) restrictions on the transfer of certificates of necessity or
other similar authorizations required by the Issuer and its Restricted
Subsidiaries to provide emergency medical transportation services, to
the extent contained in such documents or otherwise required by the
granting authority or jurisdiction;
(6) applicable law, rule, regulation or order;
(7) customary non-assignment provisions of any contract or any
lease governing a leasehold interest of any Restricted Subsidiary;
(8) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired;
39
(9) Purchase Money Indebtedness and Capitalized Lease Obligations
permitted to be incurred pursuant to Section 4.03(b)(6) that impose
limitations of the nature described in clause (c) of Section 4.05(a);
(10) customary restrictions on the transfer of any property or
assets arising under a security or other agreement governing a Lien
not prohibited under this Indenture;
(11) any agreement governing Refinancing Indebtedness; provided,
however, that the encumbrances or restrictions contained in any such
Refinancing Indebtedness are not, taken as a whole, materially more
restrictive than the provisions relating to such encumbrances or
restrictions contained in the Indebtedness being refinanced; and
(12) any restriction existing under any agreement entered into
with respect to the sale or disposition of all or substantially all of
the Capital Stock or of assets of a Subsidiary provided that the sale
or disposition in governed by Sections 4.06 and 4.08.
Section 4.06. Asset Sales. (a) The Issuer will not, and will not
permit any of the Restricted Subsidiaries to, consummate an Asset Sale unless:
(1) the Issuer or the applicable Restricted Subsidiary, as the
case may be, receives consideration at the time of such Asset Sale at
least equal to the Fair Market Value of the assets sold or otherwise
disposed of;
(2) at least 75% of the consideration received by the Issuer or
the Restricted Subsidiary, as the case may be, from such Asset Sale
shall be in the form of cash or Cash Equivalents; provided that the
amount of:
(a) any liabilities (as shown on the Issuer's or such
Restricted Subsidiary's most recent balance sheet or in the
footnotes thereto), of the Issuer or any of its Restricted
Subsidiaries (other than contingent liabilities and liabilities
that are by their terms subordinated to the Notes (excluding the
Issuer's guarantee of the Senior Subordinated Notes)) that are
assumed by the transferee of any such assets shall be deemed to
be cash for purposes of this clause (2); and
(b) any securities, notes or other obligations received by
the Issuer or any such Restricted Subsidiary from such transferee
that are converted by the Issuer or such Restricted Subsidiary
into cash (to the extent of the cash received) within 180 days
following the closing of such Asset Sale shall be deemed to be
cash for purposes of this clause (2); and
(3) upon the consummation of an Asset Sale, the Issuer shall
apply, or cause such Restricted Subsidiary to apply, the Net Cash
Proceeds relating to such Asset Sale within 360 days after receipt
thereof either to:
(A) repay Indebtedness outstanding under (i) the Credit
Agreement or another Facility and, if the Indebtedness repaid is
revolving credit Indebtedness, to correspondingly permanently
reduce commitments with respect thereto and (ii) the Senior
Subordinated Notes and other Indebtedness of the Issuer's
Restricted Subsidiaries,
40
(B) acquire Replacement Assets, or
(C) a combination of repayment and acquisition permitted by
the foregoing clauses (3)(A) and (3)(B).
(b) On the 361st day after an Asset Sale or such earlier date, if
any, as the Board of Directors of the Issuer or of such Restricted Subsidiary
determines not to apply the Net Cash Proceeds relating to such Asset Sale as set
forth in clauses (3)(A), (3)(B) and (3)(C) of Section 4.06(a) (each, a "NET
PROCEEDS OFFER TRIGGER DATE"), such aggregate amount of Net Cash Proceeds which
have not been applied on or before such Net Proceeds Offer Trigger Date as
permitted in clauses (3)(A), (3)(B) and (3)(C) of the preceding paragraph (each
a "NET PROCEEDS OFFER AMOUNT") shall be applied by the Issuer to make an offer
to purchase (the "NET PROCEEDS OFFER") to all Holders and, to the extent
required by the terms of any Pari Passu Debt, an offer to purchase to all
holders of such Pari Passu Debt, on a date (the "NET PROCEEDS OFFER PAYMENT
DATE") not less than 30 nor more than 60 days following the applicable Net
Proceeds Offer Trigger Date, from all Holders (and holders of such Pari Passu
Debt) on a pro rata basis, that Accreted Value of Notes (and principal amount of
Pari Passu Debt) equal to the Net Proceeds Offer Amount at a price equal to 100%
of the Accreted Value as of the Net Proceeds Offer Payment Date of the Notes to
be purchased, plus accrued and unpaid interest, if any, thereon to the date of
purchase (and in the case of Pari Passu Debt, the redemption price for such Pari
Passu Debt set forth in the related documentation governing such Indebtedness,
plus accrued and unpaid interest, if any, thereon to the date of purchase);
provided, however, that if at any time any non-cash consideration received by
the Issuer or any Restricted Subsidiary, as the case may be, in connection with
any Asset Sale is converted into or sold or otherwise disposed of for cash
(other than interest received with respect to any such non-cash consideration)
or Cash Equivalents, then such conversion or disposition shall be deemed to
constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be
applied in accordance with this Section 4.06.
(c) The Issuer may defer the Net Proceeds Offer until there is an
aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10..0
million resulting from one or more Asset Sales or deemed Asset Sales (at which
time, the entire unutilized Net Proceeds Offer Amount, and not just the amount
in excess of $10.0 million, shall be applied as required pursuant to this
paragraph). Pending the final application of any Net Cash Proceeds, the Issuer
or such Restricted Subsidiary may temporarily reduce revolving credit borrowings
or otherwise invest the Net Cash Proceeds in any manner that is not prohibited
by this Indenture. The first such date the aggregate unutilized Net Proceeds
Offer Amount is equal to or in excess of $10.0 million shall be treated for this
purpose as the Net Proceeds Offer Trigger Date.
(d) In the event of the transfer of substantially all (but not all)
of the property and assets of the Issuer and the Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Article 6 which
transaction does not constitute a Change of Control, the successor corporation
shall be deemed to have sold the properties and assets of the Issuer and the
Restricted Subsidiaries not so transferred for purposes of this Section 4.06,
and shall comply with the provisions of this Section 4.06 with respect to such
deemed sale as if it were an Asset Sale. In addition, the Fair Market Value of
such properties and assets of the Issuer or the Restricted Subsidiaries deemed
to be sold shall be deemed to be Net Cash Proceeds for purposes of this Section
4.06.
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(e) Each Net Proceeds Offer will be mailed to the record Holders as
shown on the register of Holders within 30 days following the Net Proceeds Offer
Trigger Date, with a copy to the Trustee, and shall comply with the procedures
set forth in this Indenture. Upon receiving notice of the Net Proceeds Offer,
Holders may elect to tender their Notes in whole or in part in integral
multiples of $1,000 principal amount at maturity in exchange for cash. If any
proceeds remain after consummation of the purchase of all properly tendered and
not withdrawn Notes pursuant to a Net Proceeds Offer, the Issuer may use such
remaining proceeds for any purpose not otherwise prohibited by this Indenture.
To the extent Holders properly tender Notes and holders of Pari Passu Debt
properly tender such Indebtedness in an amount exceeding the Net Proceeds Offer
Amount, the tendered Notes and Pari Passu Debt will be purchased on a pro rata
basis based on aggregate amounts of Notes and Pari Passu Debt tendered. A Net
Proceeds Offer shall remain open for a period of 20 Business Days or such longer
period as may be required by law. Upon completion of each Net Proceeds Offer,
the Net Proceeds Offer Amount shall be reset at zero.
(f) The Issuer will comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations to the extent
such laws and regulations are applicable in connection with the repurchase of
Notes pursuant to a Net Proceeds Offer. To the extent that the provisions of any
securities laws or regulations conflict with this Section 4.06, the Issuer shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.06 by virtue
thereof.
Section 4.07. Transactions with Affiliates. (a) The Issuer will not,
and will not permit any of the Restricted Subsidiaries to, directly or
indirectly, enter into or permit to exist any transaction or series of related
transactions (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with, or for the
benefit of, any of its Affiliates (each an "AFFILIATE TRANSACTION"), other than:
(i) Affiliate Transactions permitted under Section 4.07(b) below;
or
(ii) Affiliate Transactions on terms that are not less favorable
than those that would have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an
Affiliate of the Issuer or such Restricted Subsidiary.
All Affiliate Transactions (and each series of related Affiliate
Transactions which are related, similar or part of a common plan) involving
aggregate payments or other property with a Fair Market Value in excess of $1.0
million shall be approved by a majority of the disinterested members of the
Board of Directors of the Issuer, such approval to be evidenced by a Board
Resolution stating that such disinterested members of the Board of Directors
have determined that such transaction complies with the foregoing provisions. If
the Issuer or any Restricted Subsidiary enters into an Affiliate Transaction (or
series of related Affiliate Transactions which are related, similar or part of a
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common plan) that involves an aggregate Fair Market Value of more than $10.0
million or as to which there are no disinterested members of the Board of
Directors of the Issuer shall, prior to the consummation thereof, obtain a
favorable opinion as to the fairness of such transaction or series of related
transactions the Issuer or the relevant Restricted Subsidiary, as the case may
be, from a financial point of view, from an Independent Financial Advisor and
file the same with the Trustee.
(b) The restrictions set forth in clause (a) shall not apply to:
(1) fees and compensation paid to, and benefits (including stock
options and awards) and indemnity provided on behalf of, officers,
directors, employees or consultants of the Issuer or any Restricted
Subsidiary as determined in good faith by the Issuer's Board of
Directors or senior management;
(2) transactions exclusively between or among the Issuer and any
of the Restricted Subsidiaries or exclusively between or among such
Restricted Subsidiaries; provided that such transactions are not
otherwise prohibited by this Indenture;
(3) transactions between or among the Issuer or any Restricted
Subsidiary and Permitted Joint Ventures, to the extent such
transactions are on terms that are not less favorable to the Issuer or
any Restricted Subsidiary than those that would have been obtained in
a comparable transaction at such time on an arm's length basis from a
person that is not an Affiliate of the Issuer or such Restricted
Subsidiaries;
(4) any agreement as in effect as of the Issue Date and disclosed
in the Offering Memorandum or any amendment or replacement agreement
thereto or any transaction contemplated thereby (including pursuant to
any amendment thereto) so long as any such amendment or replacement
agreement is not more disadvantageous to the Holders in any material
respect than the original agreement as in effect on the Issue Date;
and
(5) Restricted Payments or Permitted Investments permitted by
this Indenture.
Section 4.08. Change of Control. (a) Upon the occurrence of a Change
of Control, each Holder will have the right to require that the Issuer purchase
all or a portion of such Holder's Notes pursuant to this Section 4.08 (the
"CHANGE OF CONTROL OFFER"), at a purchase price equal to 101% of the Accreted
Value thereof plus accrued and unpaid interest, if any, thereon to the date of
purchase (the "CHANGE OF CONTROL PAYMENT").
(b) Within 30 days following the date upon which the Change of
Control occurs, the Issuer must send, by first class mail, a notice to each
Holder, with a copy to the Trustee, which notice shall govern the terms of the
Change of Control Offer. Such notice shall state, among other things, the
purchase date, which must be no earlier than 30 days nor later than 60 days from
the date such notice is mailed (the "CHANGE OF CONTROL PAYMENT DATE").
(c) Holders electing to have a Note purchased pursuant to a Change of
Control 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 paying agent at the address specified in the notice prior to the close of
business on the third Business Day prior to the Change of Control Payment Date.
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(d) On the Change of Control Payment Date, the Issuer will, to the
extent lawful:
(1) accept for payment all Notes or portions of Notes properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the paying agent an amount equal to the Change
of Control Payment in respect of all Notes or portions of Notes
properly tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the
aggregate principal amount at maturity of Notes or portions of Notes
being purchased by the Issuer.
(e) On the Change of Control Purchase Date all Notes purchased by the
Issuer under this Section 4.08 shall be delivered to the Trustee for
cancellation, and the Issuer shall pay the Change of Control Payment to the
Holders entitled thereto. The paying agent will promptly mail to each Holder of
Notes properly tendered the Change of Control Payment for such Notes, and the
Trustee will promptly authenticate and mail to each Holder a new Note in a
principal amount at maturity equal to any unpurchased portion of the Notes
surrendered, if any; provided, however, that each new Note will be in a
principal amount at maturity of $1,000 or an integral multiple of $1,000.
(f) Notwithstanding the foregoing provisions of this Section, the
Issuer shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in Section
4.08(b) applicable to a Change of Control Offer made by the Issuer and purchases
all Notes validly tendered and not withdrawn under such Change of Control Offer.
(g) At the time the Issuer delivers Notes to the Trustee which are to
be accepted for purchase, the Issuer shall also deliver an Officers' Certificate
stating that such Notes are to be accepted by the Issuer pursuant to and in
accordance with the terms of this Section 4.08. A Note shall be deemed to have
been accepted for purchase at the time the Trustee, directly or through an
agent, mails or delivers payment therefor to the surrendering Holder.
(h) Prior to any Change of Control Offer, the Issuer shall deliver to
the Trustee an Officers' Certificate stating that all conditions precedent
contained herein to the right of the Issuer to make such offer have been
complied with.
(i) The Issuer shall comply with the requirements of Section 14e-1 of
the Exchange Act and any other securities laws or regulations in connection with
the repurchase of Notes pursuant to this Section 4.08 to the extent those laws
and regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Section 4.08,
the Issuer shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this Section by
virtue thereof.
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Section 4.09. Compliance Certificate. The Issuer shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Issuer an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Issuer they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Issuer taking or propose to take with
respect thereto. The Issuer also shall comply with Section 314(a)(4) of the TIA.
Section 4.10. Further Instruments and Acts. Upon request of the
Trustee, the Issuer shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
Section 4.11. Liens. The Issuer will not, directly or indirectly,
create, incur, assume or permit or suffer to exist any Liens securing borrowed
money against or upon any property or assets of the Issuer, whether owned on the
Issue Date or acquired after the Issue Date, or any proceeds therefrom, unless:
(1) in the case of Liens securing borrowed money that is
expressly subordinate or junior in right of payment to the Notes, the
Notes are secured by a Lien on such property, assets or proceeds that
is senior in priority to such Liens; and
(2) in the case of Liens securing borrowed money that is equal in
right of payment to the Notes, the Notes are equally and ratably
secured,
except for:
(A) Liens existing as of the Issue Date to the extent and in the
manner such Liens are in effect on the Issue Date after giving effect
to the application of the proceeds of the Offerings;
(B) Liens securing the Notes;
(C) Liens securing Refinancing Indebtedness which is incurred to
Refinance any Indebtedness secured by a Lien permitted under this
Indenture; provided, however, that such Liens do not extend to or
cover any property or assets of the Issuer not securing the
Indebtedness so Refinanced; and
(D) Permitted Liens.
Section 4.12. [Reserved].
Section 4.13. Maintenance of Office or Agency. (a) The Issuer shall
maintain an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee or the Registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
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upon the Issuer in respect of the Notes and this Indenture may be served. The
Issuer 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 Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the corporate trust office of the
Trustee as set forth in Section 13.02.
(b) The Issuer 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; provided,
however, that no such designation or rescission shall in any manner relieve the
Issuer of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes. The Issuer shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
Section 4.14. Business Activities. The Issuer and its Restricted
Subsidiaries will not engage in any businesses which are not the same, similar
or reasonably related or ancillary to the businesses in which the Issuer and its
Restricted Subsidiaries are engaged on the Issue Date, including but not limited
to any other emergency services businesses (a "PERMITTED BUSINESS").
Section 4.15. Payment for Consent. The Issuer will not, and will not
permit any of its Subsidiaries to, directly or indirectly, pay or cause to be
paid any consideration to or for the benefit of any holder of 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
and is paid to all holders of Notes that consent, waive or agree to amend in the
time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
Section 4.16. [Reserved].
Section 4.17. Limitation on Designations of Unrestricted
Subsidiaries. (a) After the Issue Date, the Issuer may designate any Subsidiary
of the Issuer (other than a Subsidiary of the Issuer which owns Capital Stock of
a Restricted Subsidiary) as an "Unrestricted Subsidiary" (a "DESIGNATION") only
if:
(1) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such Designation;
and
(2) the Issuer is permitted to make a Restricted Payment pursuant
to Section 4.04 at the time of Designation (assuming the effectiveness
of such Designation) in an amount equal to the Fair Market Value of
Issuer's and the Restricted Subsidiaries' Investment in such
Subsidiary on such date.
(b) The Issuer shall not, and shall not cause or permit any
Restricted Subsidiary to, at any time:
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(1) provide direct or indirect credit support for or a guarantee
of any Indebtedness of any Unrestricted Subsidiary (including any
undertaking agreement or instrument evidencing such Indebtedness);
(2) be directly or indirectly liable for any Indebtedness of any
Unrestricted Subsidiary; or
(3) be directly or indirectly liable for any Indebtedness which
provides that the holder thereof may (upon notice, lapse of time or
both) declare a default thereon or cause the payment thereof to be
accelerated or payable prior to its final scheduled maturity upon the
occurrence of a default with respect to any Indebtedness of any
Unrestricted Subsidiary (including any right to take enforcement
action against such Unrestricted Subsidiary),
except, in the case of clause (b)(1) or (b)(2), to the extent permitted under
Section 4.04 or the definition of Permitted Investments.
(c) The Issuer may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary ("REVOCATION"), whereupon such Subsidiary shall then
constitute a Restricted Subsidiary, if:
(1) no Default or Event of Default shall have occurred and be
continuing at the time and after giving effect to such Revocation;
(2) immediately after giving effect to such Revocation, (x) if
such Subsidiary is a Subsidiary of Rural/Metro LLC, Rural/Metro LLC
would be permitted to incur $1.00 of additional Indebtedness pursuant
to Section 4.01(a) (ii) or (y) is such Subsidiary is a Subsidiary
other than a Subsidiary described in clause (x) above, Issuer would be
permitted to incur $1.00 of additional Indebtedness pursuant to
Section 4.01(a)(i); and
(3) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred
at such time, have been permitted to be incurred under this Indenture.
(d) All Designations and Revocations must be evidenced by a Board
Resolution of the Issuer delivered to the Trustee, together with an Officers'
Certificate certifying compliance with the foregoing provisions.
ARTICLE 5
MERGER, CONSOLIDATION OR SALE OF ASSETS
Section 5.01. Consolidation, Merger or Sale of Assets of the Issuer.
The Issuer will not, in a single transaction or series of related transactions,
consolidate or merge with or into any Person, or sell, assign, transfer, lease,
convey or otherwise dispose of (or cause or permit any Restricted Subsidiary to
sell, assign, transfer, lease, convey or otherwise dispose of) all or
substantially all of the Issuer's assets (determined on a consolidated basis for
the Issuer and the Restricted Subsidiaries) to any Person unless:
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(1) either
(A) the Issuer shall be the surviving or continuing
corporation or
(B) the Person (if other than the Issuer) formed by such
consolidation or into which the Issuer is merged or the Person to
which such sale, assignment, transfer, lease, conveyance or other
disposition has been made (the "SURVIVING ENTITY"):
(i) shall be a corporation organized and validly
existing under the laws of the United States or any State
thereof or the District of Columbia; and
(ii) shall expressly assume, by supplemental indenture
(in form and substance satisfactory to the Trustee),
executed and delivered to the Trustee, the due and punctual
payment of the principal of, and premium, if any, and
interest on all of the Notes and the performance of every
covenant of the Notes, this Indenture and the Registration
Rights Agreement on the part of Issuer to be performed or
observed;
(2) except in the case of a consolidation or merger of the Issuer
with or into, or a disposition to, a Restricted Subsidiary,
immediately after giving effect to such transaction and the assumption
contemplated by clause (1)(B)(ii) above (including giving effect to
any Indebtedness and Acquired Indebtedness incurred or anticipated to
be incurred in connection with or in respect of such transaction), the
Issuer or such Surviving Entity, as the case may be, shall be able to
incur at least $1.00 of additional Indebtedness pursuant to the
Consolidated Fixed Charge Coverage Ratio test set forth in Section
4.03(a);
(3) immediately before and immediately after giving effect to
such transaction and the assumption contemplated by clause (1)(B)(ii)
above (including, without limitation, giving effect to any
Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred and any Lien granted in connection with or in respect of the
transaction), no Default or Event of Default shall have occurred and
be continuing; and
(4) the Issuer or the Surviving Entity, as the case may be, shall
have delivered to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, sale,
assignment, transfer, lease, conveyance or other disposition and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture complies with the applicable
provisions of this Indenture and that all conditions precedent in this
Indenture relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries, the Capital Stock of which constitutes all or substantially all of
the properties and assets of the Issuer, shall be deemed to be the transfer of
all or substantially all of the properties and assets of the Issuer.
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Upon any consolidation, combination or merger or any transfer of all
or substantially all of the assets of the Issuer in accordance with the
foregoing in which the Issuer is not the continuing corporation, the successor
Person formed by such consolidation or into which the Issuer is merged or to
which such conveyance, lease or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer under
this Indenture and the Notes with the same effect as if such surviving entity
had been named as such.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default. The following events constitute an
"EVENT OF DEFAULT":
(a) the failure to pay interest on any Notes when the same becomes
due and payable and the default continues for a period of 30 days;
(b) the failure to pay the principal on any Notes, when such
principal becomes due and payable, at maturity, upon redemption or otherwise
(including the failure to make a payment to purchase Notes tendered pursuant to
a Change of Control Offer or a Net Proceeds Offer);
(c) a default in the observance or performance of any other covenant
or agreement contained in this Indenture which default continues for a period of
60 days after the Issuer receives written notice specifying the default from the
Trustee or the Holders of at least 25% of the outstanding principal amount at
maturity of the Notes (except that a default with respect to Article 5 will
constitute an Event of Default with such notice requirement but without such
passage of time requirement);
(d) a default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness of the Issuer or of any Restricted Subsidiary (or the payment of
which is guaranteed by the Issuer or any Restricted Subsidiary), whether such
Indebtedness now exists or is created after the Issue Date, which default (A) is
caused by a failure to pay principal at final maturity of such Indebtedness
after any applicable grace period (and any extensions thereof) provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT") or (B) results in
the acceleration of such Indebtedness prior to its express maturity and, in each
case, the principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been such a payment
default or the maturity of which has been so accelerated, aggregates $5.0
million;
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(e) one or more judgments in an aggregate amount in excess of $5..0
million (net of amounts covered by insurance) shall have been rendered against
the Issuer or any of the Restricted Subsidiaries and such judgments remain
undischarged, unpaid, unstayed or unsatisfied for a period of 60 days after such
judgment or judgments become final and nonappealable; or
(f) the Issuer or any Significant Subisidary pursuant to or within
the meaning of any Bankruptcy Law:
(i) commences a voluntary case;
(ii) consents to the entry of an order for relief against it in
an involuntary case;
(iii) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(iv) makes a general assignment for the benefit of its creditors
or take any comparable action under any foreign laws relating to
insolvency; or
(g) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Issuer or any Significant
Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Issuer or any Significant
Subsidiary or for any substantial part of its property;
(iii) orders the winding up or liquidation of the Issuer or any
Significant Subsidiary; or
(iv) any similar relief is granted under any foreign laws and the
order or decree remains unstayed and in effect for 60 days.
The foregoing shall constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "BANKRUPTCY LAW" means Xxxxx 00, Xxxxxx Xxxxxx Code, or any
similar Federal or state law for the relief of debtors. The term "CUSTODIAN"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
Section 6.02. Acceleration. If an Event of Default (other than an
Event of Default specified in Sections 6.01(f) or (g)) shall occur and be
continuing, the Trustee or the Holders of at least 25% in principal amount at
maturity of outstanding Notes may declare the Accreted Value of, premium, if
any, and accrued interest on, and Accreted Value of, all the Notes to be due and
payable immediately by notice in writing to the Issuer (and if given by the
Holders, the Trustee) specifying the respective Events of Default and that it is
a "notice of acceleration." Upon such notice of acceleration, the Accreted Value
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of and accrued and unpaid interest, if any, on, and Accreted Value of, the
outstanding Notes shall become due and payable. If an Event of Default specified
in Section 6.01(f) or (g) above with respect to the Issuer occurs and is
continuing, then all unpaid principal of, premium, if any, and accrued and
unpaid interest on all of the outstanding 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.
In the event of an acceleration declaration of the Notes because an
Event of Default described in Section 6.01(d) has occurred and is continuing,
the acceleration declaration shall be automatically annulled if the payment
default or other default triggering such Event of Default pursuant to Section
6.01(d) shall be remedied or cured by the Issuer or a Restricted Subsidiary or
waived by the holders of the relevant Indebtedness within 20 days after the
acceleration declaration with respect thereto and if (a) the annulment of the
acceleration of the Notes would not conflict with any judgment or decree of a
court of competent jurisdiction and (b) all existing Events of Default, except
nonpayment of principal, premium or interest on the Notes that became due solely
because of the acceleration of the Notes, have been cured or waived.
At any time after a declaration of acceleration with respect to the
Notes as described in the preceding paragraph, the Holders of a majority in
principal amount at maturity of the then outstanding Notes may rescind and
cancel such declaration and its consequences:
(1) if the rescission would not conflict with any judgment or
decree;
(2) if all existing Events of Default have been cured or waived
except nonpayment of principal or interest that has become due solely
because of the acceleration;
(3) to the extent the payment of such interest is lawful, if
interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of
acceleration, has been paid;
(4) if the Issuer has paid the Trustee its reasonable
compensation and reimbursed the Trustee for its expenses,
disbursements and advances; and
(5) in the event of the cure or waiver of an Event of Default of
the type described in Sections 6.01(f) or (g), the Trustee shall have
received an Officers' Certificate and an Opinion of Counsel that such
Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or Event of
Default or impair any right consequent thereto.
The Holders of a majority in principal amount at maturity of the then
outstanding Notes may waive any existing Default or Event of Default under this
Indenture, and its consequences, except a default in the payment of the
principal of or premium, if any, or interest on any Notes.
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The Issuer is required to provide an Officers' Certificate to the
Trustee promptly upon the Issuer obtaining knowledge of any Default or Event of
Default (provided that the Issuer shall provide such certification at least
annually whether or not they know of any Default or Event of Default) that has
occurred and, if applicable, describe such Default or Event of Default and the
status thereof.
Section 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy at law or in equity to
collect the payment of principal of or interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative. Section 6.04. Waiver of
Past Defaults. Provided the Notes are not then due and payable by reason of a
declaration of acceleration, the Holders of a majority in aggregate principal
amount at maturity of the Notes outstanding by notice to the Trustee may waive
an existing Default and its consequences except (a) a Default in the payment of
the principal of or interest on a Note (including in connection with an offer to
purchase) or (b) a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Holder affected. When a Default is
waived, it is deemed cured and the Issuer, the Trustee and the Holders will be
restored to their former positions and rights under this Indenture, but no such
waiver shall extend to any subsequent or other Default or impair any consequent
right.
Section 6.05. Control by Majority. The Holders of a majority in
aggregate principal amount at maturity of the Notes outstanding may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or of exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that conflicts with law
or this Indenture or, subject to Section 7.01, that the Trustee determines is
unduly prejudicial to the rights of any other Holder or that would involve the
Trustee in personal liability; provided, however, that the Trustee may take any
other action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action under this Indenture, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
Section 6.06. Limitation on Suits. (a) Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to this Indenture or the Notes unless:
(i) the Holder gives to the Trustee written notice stating that
an Event of Default is continuing;
(ii) the Holders of at least 25% in principal amount at maturity
of the Notes make a written request to the Trustee to pursue the
remedy;
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(iii) such Holder or Holders offer to the Trustee reasonable
security or indemnity satisfactory to it against any loss, liability
or expense;
(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of security or indemnity;
and
(v) the Holders of a majority in principal amount at maturity of
the Notes outstanding do not give the Trustee a direction inconsistent
with the request during such 60-day period.
(b) A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another Holder.
Section 6.07. Rights of the Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of principal of and interest on the Notes held by such
Holder, on or after the respective due dates expressed or provided for in the
Notes, or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
Section 6.08. Collection Suit by Trustee. If an Event of Default
specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Issuer or any other obligor on the Notes for the whole amount then due and owing
(together with interest on overdue principal and (to the extent lawful) on any
unpaid interest at the rate provided for in the Notes) and the amounts provided
for in Section 7.07.
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
reasonable compensation, expenses disbursements and advances of the Trustee
(including counsel, accountants, experts or such other professionals as the
Trustee deems necessary, advisable or appropriate)) and the Holders allowed in
any judicial proceedings relative to the Issuer, their creditors or their
property, shall be entitled to participate as a member, voting or otherwise, of
any official committee of creditors appointed in such matters and, unless
prohibited by law or applicable regulations, may vote on behalf of the Holders
in any election of a trustee in bankruptcy or other Person performing similar
functions, and any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee and, in the event that
the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.07.
Section 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article 6, it shall pay out the money or property in
the following order:
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FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to the Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes for
principal and interest, respectively; and
THIRD: to the Issuer.
The Trustee may fix a record date and payment date for any payment to
the Holders pursuant to this Section. At least 15 days before such record date,
the Trustee shall mail to each Holder and the Issuer a notice that states the
record date, the payment date and amount to be paid.
Section 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by
Holders of more than 10% in principal amount at maturity of the Notes.
Section 6.12. Waiver of Stay or Extension Laws. The Issuer (to the
extent it may lawfully do so) shall not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Issuer (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and shall not hinder, delay or impede the execution
of any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
Section 6.13. Waiver of Substantive Consolidation Claims. The Trustee
and each Holder and beneficial owner of Notes, by accepting a Note, agrees that,
in any proceeding under the U.S. Bankruptcy Code or any proceeding under any
similar law, it will not, directly or indirectly, request, join in or support
any request, or provide any assistance or encouragement or solicit any other
person to make any request, for substantive consolidation of the Issuer with any
one or more of its Subsidiaries or for a determination that piercing the
corporate veil, alter ego or any similar theory is applicable to the Issuer and
one or more of its Subsidiaries and waive any and all rights they may have to do
so. In the event that the Issuer is substantively consolidated with any or more
of its Subsidiaries, the Trustee and each Holder and beneficial owner agree that
it will not benefit from such substantive consolidation and will be treated as
if the substantive consolidation did not occur (and any such benefit that would
have accrued to the Holders shall be turned over to the creditors of the
Subsidiary or Subsidiaries that are so substantively consolidated). The Trustee
and each Holder and beneficial owner acknowledges that lenders under the Credit
Agreement and holders of the Notes are expressly relying on the separateness of
the Issuer from its Subsidiaries, and agree that lenders under the Credit
Agreement, holders of the Notes and other creditors of Subsidiaries of the
Issuer may rely on the agreements and waivers in this Section 6.13. The
provisions of this Section 6.13 are not binding on creditors of the Issuer other
than the Trustee and the Holders and beneficial owners of Notes, in their
capacities as such.
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ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of such person's own affairs.
Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, in the case of certificates or opinions
required by any provision hereof to be provided to it, the Trustee
shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture.
(b) 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:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05; and
(iv) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in
the performance of any of its duties hereunder or in the exercise of
any of its rights or powers.
(c) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
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(d) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(f) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
Section 7.02. Rights of Trustee(a) . (a) The Trustee may conclusively
rely on any document believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute
willful misconduct or negligence.
(e) The Trustee may consult with counsel of its own selection and the
advice or Opinion of Counsel with respect to legal matters relating to this
Indenture and the Notes 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.
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
note or other paper or document unless requested in writing to do so by the
Holders of not less than a majority in principal amount at maturity of the Notes
at the time outstanding, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Issuer, personally or by agent or attorney, at the expense of the Issuer
and shall incur no liability of any kind by reason of such inquiry or
investigation.
(g) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity satisfactory to the Trustee against
the costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.
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(h) The rights, privileges, protections, immunities and benefits
given to the Trustee, including its right to be indemnified, are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder,
and each agent, custodian and other Person employed to act hereunder.
(i) In no event shall the Trustee be responsible or liable for
special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss or profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action.
Section 7.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Trustee. Any Paying Agent or Registrar may do the same
with like rights. However, the Trustee must comply with Sections 7.10 and 7..11.
Section 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Notes, it shall not be accountable for the Issuer's use of
the proceeds from the Notes, and it shall not be responsible for any statement
of the Issuer in this Indenture or in any document issued in connection with the
sale of the Notes or in the Notes other than the Trustee's certificate of
authentication. The Trustee shall not be charged with knowledge of any Default
or Event of Default under Sections 6.01(c), (d), (e) or (h) unless either (a) a
Trust Officer shall have actual knowledge thereof or (b) the Trustee shall have
received notice thereof in accordance with Section 13.02 hereof from the Issuer
or any Holder.
Section 7.05. Notice of Defaults. If a Default occurs and is
continuing and if it is actually known to the Trustee, the Trustee shall mail to
each Holder notice of the Default within the earlier of (a) 90 days after it
occurs or (b) 30 days after it is actually known to a Trust Officer or written
notice of it is received by the Trustee. Except in the case of a Default in the
payment of principal of, premium (if any) or interest on any Note, the Trustee
may withhold the notice if and so long as a committee of its Trust Officers in
good faith determines that withholding the notice is in the interests of the
Holders. Section 7.06. Reports by Trustee to the Holders. As promptly as
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to September 30 in each year, the Trustee
shall mail to each Holder a brief report dated as of such September 30 that
complies with Section 313(a) of the TIA if and to the extent required thereby.
The Trustee shall also comply with Section 313(b) of the TIA.
A copy of each report at the time of its mailing to the Holders shall
be filed with the Commission and each stock exchange (if any) on which the Notes
are listed. The Issuer agrees to notify promptly the Trustee whenever the Notes
become listed on any stock exchange and of any delisting thereof.
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Section 7.07. Compensation and Indemnity. The Issuer shall pay to the
Trustee from time to time reasonable compensation for its services, as agreed
upon from time to time in writing. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuer
shall reimburse the Trustee upon request for all reasonable out-of-pocket
expenses incurred or made by it, including costs of collection, in addition to
the compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Trustee's agents,
counsel, accountants and experts. The Issuer shall indemnify the Trustee against
any and all loss, liability, claim, damage or expense (including reasonable
attorneys' fees and expenses) incurred by or in connection with the acceptance
or administration of this trust and the performance of its duties hereunder,
including the costs and expenses of enforcing this Indenture against the Issuer
(including this Section 7.07) and defending itself against or investigating any
claim (whether asserted by the Issuer, any Holder or any other Person). The
Trustee shall notify the Issuer of any claim for which it may seek indemnity
promptly upon obtaining actual knowledge thereof; provided, however, that any
failure so to notify the Issuer shall not relieve the Issuer of its indemnity
obligations hereunder. The Issuer shall defend the claim and the indemnified
party shall provide reasonable cooperation at the Issuer's expense in the
defense. Such indemnified parties may have separate counsel and the Issuer shall
pay the fees and expenses of such counsel; provided, however, that the Issuer
shall not be required to pay such fees and expenses if it assumes such
indemnified parties' defense and, in such indemnified parties' reasonable
judgment, there is no conflict of interest between the Issuer and such parties
in connection with such defense. The Issuer need not reimburse any expense or
indemnify against any loss, liability or expense incurred by an indemnified
party through such party's own willful misconduct, negligence or bad faith.
To secure the Issuer's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Notes.
The Issuer's payment obligations pursuant to this Section shall
survive the satisfaction or discharge of this Indenture, any rejection or
termination of this Indenture under any bankruptcy law or the resignation or
removal of the Trustee. Without prejudice to any other rights available to the
Trustee under applicable law, when the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(f) or (g) with respect to the
Issuer, the expenses are intended to constitute expenses of administration under
the Bankruptcy Law.
Section 7.08. Replacement of Trustee. (a) The Trustee may resign and
be discharged from the trust hereby created upon 30 days' prior notice to the
Issuer. The Holders of a majority in principal amount at maturity of the Notes
outstanding may remove the Trustee by so notifying the Trustee and may appoint a
successor Trustee. The Issuer shall remove the Trustee if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the
Trustee or its property; or
(iv) the Trustee otherwise becomes incapable of acting.
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(b) If the Trustee resigns, is removed by the Issuer or by the
Holders of a majority in principal amount at maturity of the Notes outstanding
and such Holders do not reasonably promptly appoint a successor Trustee, or if a
vacancy exists in the office of Trustee for any reason (the Trustee in such
event being referred to herein as the retiring Trustee), the Issuer shall
promptly appoint a successor Trustee.
(c) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to the
Holders. The retiring Trustee shall, upon payment of its charges hereunder,
promptly transfer all property held by it as Trustee to the successor Trustee,
subject to the Lien provided for in Section 7.07.
(d) If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee or the Holders
of 10% in principal amount at maturity of the Notes may petition at the expense
of the Issuer any court of competent jurisdiction for the appointment of a
successor Trustee.
(e) If the Trustee fails to comply with Section 7.10, unless the
Trustee's duty to resign is stayed as provided in Section 310(b) of the TIA, any
Holder who has been a bona fide holder of a Note for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
(f) Notwithstanding the replacement of the Trustee pursuant to this
Section, the Issuer's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor trustee hereunder or in the name of the successor
to the Trustee; and in all such cases such certificates shall have the full
force which it is anywhere in the Notes or in this Indenture provided that the
certificate of the Trustee shall have.
Section 7.10. Eligibility; Disqualification. The Trustee shall at all
times satisfy the requirements of Section 310(a) of the TIA. The Trustee shall
have a combined capital and surplus of at least $100,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
Section 310(b) of the TIA, subject to its right to apply for a stay of its duty
to resign under the penultimate paragraph of Section 310(b) of the TIA;
59
provided, however, that there shall be excluded from the operation of Section
310(b)(1) of the TIA any series of securities issued under this Indenture and
any indenture or indentures under which other securities or certificates of
interest or participation in other securities of the Issuer are outstanding if
the requirements for such exclusion set forth in Section 310(b)(1) of the TIA
are met.
Section 7.11. Preferential Collection of Claims Against Issuer. The
Trustee shall comply with Section 311(a) of the TIA, excluding any creditor
relationship listed in Section 311(b) of the TIA. A Trustee who has resigned or
been removed shall be subject to Section 311(a) of the TIA to the extent
indicated.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
Section 8.01. Discharge of Liability on Notes. This Indenture shall
be discharged and shall cease to be of further effect (except as to surviving
rights of registration of transfer or exchange of Notes, as expressly provided
for in this Indenture) as to all outstanding Notes when:
(1) either: (a) all the Notes theretofore authenticated and
delivered (except lost, stolen or destroyed Notes which have been
replaced or paid and Notes for whose payment money has theretofore
been deposited in trust or segregated and held in trust by the Issuer
and thereafter repaid to the Issuer or discharged from such trust)
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 or within one year will become due and payable,
whether at maturity or as a result of the mailing of a notice of
redemption, and the Issuer has irrevocably deposited or caused to be
deposited with the Trustee funds in an amount in cash in U.S. dollars,
non-callable Government Obligations, or combination thereof,
sufficient to pay and discharge the entire Indebtedness on the Notes
not theretofore delivered to the Trustee for cancellation, for
principal of, premium, if any, and interest on the Notes to the date
of deposit together with irrevocable instructions from the Issuer
directing the Trustee to apply such funds to the payment thereof at
maturity or redemption, as the case may be;
(2) the Issuer has paid or caused to be paid all other sums
payable by it under this Indenture; and
(3) the Issuer has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel stating that all conditions
precedent under this Indenture relating to the satisfaction and
discharge of this Indenture have been complied with.
Section 8.02. Defeasance. (a) The Issuer may, at its option and at
any time, elect to have all of its obligations discharged with respect to the
outstanding Notes issued under this Indenture ("LEGAL DEFEASANCE"). Such Legal
Defeasance means that the Issuer shall be deemed to have paid and discharged the
entire indebtedness represented by the outstanding Notes, except for:
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(i) the rights of Holders to receive payments in respect of the
principal of, premium, if any, and interest on the Notes when such
payments are due;
(ii) the Issuer's obligations with respect to the Notes under
Sections 2.07, 2.08 and 2.10 and the maintenance of an office or
agency for payments;
(iii) the rights, powers, trusts, duties and immunities of the
Trustee, and the Issuer's obligations in connection therewith; and
(iv) this Section 8.02(a).
(b) The Issuer may, at its option and at any time, elect to have
their obligations released with respect to Sections 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.11, 4.12, 4.14, and 4.17 and the operation of Article 5 and
Sections 6.01(c), 6.01(d), 6.01(e), 6.01(f) (with respect to Significant
Subsidiaries of the Issuer only), 6.01(g) (with respect to Significant
Subsidiaries of the Issuer only) and 6.01(h) of this Indenture ("COVENANT
DEFEASANCE") and thereafter any omission or failure to comply, with those
covenants will not constitute a Default or Event of Default with respect to the
Notes. The Issuer may exercise its Legal Defeasance option notwithstanding their
prior exercise of their Covenant Defeasance option.
If the Issuer exercises its Legal Defeasance option, payment of the
Notes so defeased may not be accelerated because of an Event of Default. If the
Issuer exercises its Covenant Defeasance option, payment of the Notes so
defeased may not be accelerated because of an Event of Default specified in
Sections 6.01(c), 6.01(d), 6.01(e), 6.01(f) (with respect to Significant
Subsidiaries of the Issuer only) and 6.01(g) (with respect to Significant
Subsidiaries of the Issuer only) or because of the failure of the Issuer to
comply with Section 5.01.
Upon satisfaction of the conditions set forth herein and upon request
of the Issuer, the Trustee shall acknowledge in writing the discharge of those
obligations that the Issuer terminates.
(c) Notwithstanding clauses (a) and (b) above, the Issuer's
obligations in Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08 and in
this Article 8 shall survive until the Notes have been paid in full. Thereafter,
the Issuer's obligations in Sections 7.07, 8.06 and 8.07 shall survive such
satisfaction and discharge.
Section 8.03. Conditions to Defeasance. (a) The Issuer may exercise
its Legal Defeasance option or its Covenant Defeasance option only if:
(i) the Issuer irrevocably deposited with the Trustee, in trust,
for the benefit of the Holders cash in U.S. dollars, non-callable
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 selected by the Issuer, to pay the
principal of, premium, if any, and interest on the Notes on the stated
date of payment thereof or on the applicable redemption date, as the
case may be;
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(ii) in the case of Legal Defeasance, the Issuer shall have
delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Issuer
have received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of this Indenture,
there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders will not recognize income,
gain or loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(iii) in the case of Covenant Defeasance, the Issuer shall have
delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders will
not recognize income, gain or loss for federal income tax purposes as
a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
(iv) no Default or Event of Default shall have occurred and be
continuing on the date of the deposit described in clause (i) above
and ending on the 91st day after the date of such deposit (other than
a Default resulting from the borrowing of funds to be applied to such
deposit and the grant of any Lien securing such borrowing);
(v) such Legal Defeasance or Covenant Defeasance shall not result
in a breach or violation of or constitute a default under this
Indenture or any other material agreement or instrument to which the
Issuer or any of its Subsidiaries is a party or by which the Issuer or
any of its Subsidiaries is bound (other than any such breach or
violation or default resulting solely from the borrowing of funds to
be applied to such deposit and the grant of any Lien on such deposit
in favor of the Trustee and/or the Holders);
(vi) the Issuer shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Issuer with
the intent of preferring the Holders over any other creditors of the
Issuer or with the intent of defeating, hindering, delaying or
defrauding any other creditors of the Issuer or others;
(vii) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance
or the Covenant Defeasance have been complied with; and
(viii) certain other customary conditions precedent are
satisfied.
If the funds deposited with the Trustee to effect Legal Defeasance or
Covenant Defeasance are insufficient to pay the principal of and interest on the
Notes when due, then the Issuer's obligations under this Indenture will be
revived and no such defeasance will be deemed to have occurred.
(b) Before or after a deposit, the Issuer may make arrangements
satisfactory to the Trustee for the redemption of such Notes at a future date in
accordance with Article 3.
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Section 8.04. Application of Trust Money. The Trustee shall hold in
trust money or Government Obligations (including proceeds thereof) deposited
with it pursuant to this Article 8. It shall apply the deposited money and the
money from Government Obligations through each Paying Agent and in accordance
with this Indenture to the payment of principal of and interest on the Notes so
discharged or defeased.
Section 8.05. Repayment to Issuer. Each of the Trustee and each
Paying Agent shall promptly turn over to the Issuer upon request any money or
Government Obligations held by it as provided in this Article which, in the
written opinion of nationally recognized firm of independent public accountants
delivered to the Trustee (which delivery shall only be required if Government
Obligations have been so deposited), are in excess of the amount thereof which
would then be required to be deposited to effect an equivalent discharge or
defeasance in accordance with this Article.
Subject to any applicable abandoned property law, the Trustee and
each Paying Agent shall pay to the Issuer upon written request any money held by
them for the payment of principal or interest that remains unclaimed for two
years, and, thereafter, Holders entitled to the money must look to the Issuer
for payment as general creditors, and the Trustee and each Paying Agent shall
have no further liability with respect to such monies.
Section 8.06. Indemnity for Government Obligations. The Issuer shall
pay and shall indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against deposited Government Obligations or the principal and
interest received on such Government Obligations.
Section 8.07. Reinstatement. If the Trustee or any Paying Agent is
unable to apply any money or Government Obligations in accordance with this
Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Issuer's obligations under this
Indenture and the Notes so discharged or defeased shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 8 until
such time as the Trustee or any Paying Agent is permitted to apply all such
money or Government Obligations in accordance with this Article 8; provided,
however, that, if the Issuer has made any payment of principal of or interest
on, any such Notes because of the reinstatement of their obligations, the Issuer
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money or Government Obligations held by the Trustee or any
Paying Agent.
ARTICLE 9
AMENDMENTS AND WAIVERS
Section 9.01. Without Consent of the Holders. (a) The Issuer and the
Trustee may amend or supplement this Indenture or the Notes without notice to or
consent of any Holder:
(i) to cure any ambiguity, omissions, defects or inconsistency;
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(ii) to provide for uncertificated Notes in addition to or in
place of certificated Notes; provided, however, that the
uncertificated Notes are issued in registered form for purposes of
Section 163(f) of the code or in a manner such that the uncertificated
Notes are described in Section 163(f)(2)(B);
(iii) to provide for the assumption of the Issuer's obligations
to holders of Notes in the case of a merger or consolidation or sale
of all or substantially all of the Issuer's assets pursuant to Article
5 hereof;
(iv) [Reserved];
(v) to add to the covenants of the Issuer for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Issuer;
(vi) to comply with any requirement of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA;
(vii) to make any change that would provide additional rights or
benefits to the Holders of Notes or that does not adversely affect the
legal rights under this Indenture of any Holder; or
(viii) to provide for the issuance of the Exchange Notes or the
Additional Notes, which shall have terms substantially identical in
all material respects to the Initial Notes, and which shall be
treated, together with any outstanding Initial Notes, as a single
issue of securities.
In formulating its opinion on such matters, the Trustee shall be
entitled to rely on such evidence as it deems appropriate, including, without
limitation, solely on an Opinion of Counsel.
After an amendment under this Section 9.01 becomes effective, the
Issuer shall mail to the Holders a notice briefly describing such amendment..
The failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.01.
Section 9.02. With Consent of the Holder. This Indenture or the Notes
issued hereunder may be amended or supplemented with the consent of the holders
of at least a majority in principal amount at maturity of the Notes then
outstanding issued under this Indenture. However, without the consent of each
Holder affected thereby, no amendment may:
(1) reduce the principal amount at maturity of Notes whose
Holders must consent to an amendment;
(2) reduce the rate of or change or have the effect of changing
the time for payment of interest, including defaulted interest, on any
Notes;
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(3) reduce the principal amount at maturity of or change or have
the effect of changing the fixed maturity of any Notes, change the
calculation of Accreted Value so as to reduce the Accreted Value at
any time or change the date on which any Notes may be subject to
redemption or repurchase, or reduce the redemption or repurchase price
therefor;
(4) make any Notes payable in money other than that stated in the
Notes;
(5) make any change in provisions of this Indenture protecting
the right of each Holder to receive payment of principal of, premium,
if any, and interest on such Notes on or after the stated due date
thereof or to bring suit to enforce such payment, or permitting
Holders of a majority in principal amount at maturity of the then
outstanding Notes to waive Defaults or Events of Default;
(6) amend, change or modify in any material respect the
obligation of the Issuer to make and consummate a Change of Control
Offer after the occurrence of a Change of Control or make and
consummate a Net Proceeds Offer with respect to any Asset Sale that
has been consummated or, after such Change of Control has occurred or
such Asset Sale has been consummated, modify any of the provisions or
definitions with respect thereto; or
(7) modify or change any provision of this Indenture or the
related definitions affecting the subordination of the Notes in a
manner which adversely affects the Holders.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective, the
Issuer shall mail to the Holders a notice briefly describing such amendment..
The failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.02.
Section 9.03. Compliance with Trust Indenture Act. From the date on
which this Indenture is qualified under the TIA, every amendment, waiver or
supplement to this Indenture or the Notes shall comply with the TIA as then in
effect.
Section 9.04. Revocation and Effect of Consents and Waivers. (a) A
consent to an amendment or a waiver by a Holder of a Note shall bind the Holder
and every subsequent Holder of that Note or portion of the Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
or waiver is not made on the Note. However, any such Holder or subsequent Holder
may revoke the consent or waiver as to such Holder's Note or portion of the Note
if the Trustee receives the notice of revocation before the date on which the
Trustee receives an Officers' Certificate from the Issuer certifying that the
requisite principal amount at maturity of Notes have consented. After an
amendment or waiver becomes effective, it shall bind every Holder. An amendment
or waiver becomes effective upon the (i) receipt by the Issuer or the Trustee of
consents by the Holders of the requisite principal amount of securities, (ii)
satisfaction of conditions to effectiveness as set forth in this Indenture and
any indenture supplemental hereto containing such amendment or waiver and (iii)
execution of such amendment or waiver (or supplemental indenture) by the Issuer
and the Trustee.
65
(b) The Issuer may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
Section 9.05. Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Issuer may require the
Holder of the Note to deliver it to the Trustee. The Trustee may place an
appropriate notation on the Note regarding the changed terms and return it to
the Holder. Alternatively, if the Issuer or the Trustee so determines, the
Issuer in exchange for the Note shall issue and the Trustee shall authenticate a
new Note that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Note shall not affect the validity of such amendment,
supplement or waiver.
Section 9.06. Trustee to Sign Amendments. The Trustee shall sign any
amendment, supplement or waiver authorized pursuant to this Article 9 if the
amendment does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may but is not required to
sign it. In signing such amendment, the Trustee shall be entitled to receive
indemnity reasonably satisfactory to it and shall be provided with, and (subject
to Section 7.01) 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 and that such amendment,
supplement or waiver is the legal, valid and binding obligation of the Issuer,
enforceable against it in accordance with its terms, subject to customary
exceptions, and complies with the provisions hereof (including Section 9.03).
Section 9.07. Additional Voting Terms; Calculation of Principal
Amount. Except as provided in the proviso to the first sentence of Section 9.02,
all Notes issued under this Indenture shall vote and consent together on all
matters (as to which any of such Notes may vote) as one class and no series of
Notes will have the right to vote or consent as a separate class on any matter.
Determinations as to whether Holders of the requisite aggregate principal amount
at maturity of Notes have concurred in any direction, waiver or consent shall be
made in accordance with this Article 9.
ARTICLE 10
[RESERVED]
ARTICLE 11
[RESERVED]
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ARTICLE 12
[RESERVED]
ARTICLE 13
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls. If and to the extent
that any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by, or with another provision (an "INCORPORATED PROVISION")
included in this Indenture by operation of, Sections 310 to 318 of the TIA,
inclusive, such imposed duties or incorporated provision shall control.
Section 13.02. Notices. Any notice or communication required or
permitted hereunder shall be in writing and delivered in person, via facsimile
or mailed by first-class mail addressed as follows:
if to the Issuer:
Rural/Metro Corporation
0000 X. Xxx xx Xxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxx, Chief Financial Officer
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
Weil, Gotshal and Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
if to the Trustee:
Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. X'Xxxxxxx
Facsimile No.: (000) 000-0000
The Issuer or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
67
(a) Any notice or communication mailed to a Holder shall be mailed,
first class mail, to the Holder at the Holder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
(b) Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders.. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it, except that notices to the
Trustee are effective only if received.
Section 13.03. Communication by the Holders with Other Holders. The
Holders may communicate pursuant to Section 312(b) of the TIA with other Holders
with respect to their rights under this Indenture or the Notes. The Issuer, the
Trustee, the Registrar and other Persons shall have the protection of Section
312(c) of the TIA.
Section 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuer to the Trustee to take or refrain
from taking any action under this Indenture, the Issuer shall furnish to the
Trustee at the request of the Trustee:
(a) an Officers' Certificate in form reasonably satisfactory to
the Trustee stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(b) an Opinion of Counsel in form reasonably satisfactory to the
Trustee stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
Section 13.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture (other than pursuant to Section 4.09) shall
include:
(a) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he has
made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with;
provided, however, that with respect to matters of fact an Opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
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Section 13.06. When Notes Disregarded. In determining whether the
Holders of the required principal amount at maturity of Notes have concurred in
any direction, waiver or consent, Notes owned by the Issuer or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Issuer shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes which the Trustee knows are so owned shall be so disregarded. Subject to
the foregoing, only Notes outstanding at the time shall be considered in any
such determination.
Section 13.07. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of the Holders..
The Registrar and a Paying Agent may make reasonable rules for their functions.
Section 13.08. Legal Holidays. If a payment date is not a Business
Day, payment shall be made on the next succeeding day that is a Business Day,
and no interest shall accrue on any amount that would have been otherwise
payable on such payment date if it were a Business Day for the intervening
period. If a regular record date is not a Business Day, the record date shall
not be affected.
Section 13.09. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY.
Section 13.10. Jurisdiction; Consent to Service of Process. (a) The
Issuer hereby irrevocably and unconditionally submits, for itself and its
property, to the general jurisdiction of the New York State courts, sitting in
the Borough of Manhattan, the City of New York, or the federal courts of the
United States of America for the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Indenture or the Notes, or for recognition or enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Indenture shall affect any right that any
Holder may otherwise have to bring any action or proceeding relating to this
Indenture or the Notes against the Issuer or its properties in the courts of any
jurisdiction.
(b) the Issuer hereby irrevocably and unconditionally waives, and
agrees not to plea or claim, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Indenture or the Notes in any New York State or federal court. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
69
(c) the Issuer hereby irrevocably and unconditionally appoints CT
Corporation System with an office on the date hereof at 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 and its successors hereunder (the "PROCESS AGENT"), as its
agent to receive on behalf of each of the Issuer and its property of all writs,
claims, process, and summonses in any action or proceeding brought against it in
the State of New York. Such service may be made by mailing or delivering a copy
of such process to the Issuer in care of the Process Agent at the address
specified above for the Process Agent, and the Issuer hereby irrevocably
authorizes and directs the Process Agent to accept such service on its behalf.
Failure by the Process Agent to give notice to the Issuer, or failure of the
Issuer to receive notice of such service of process shall not impair or affect
the validity of such service on the Process Agent, the Issuer, or of any
judgment based thereon. The Issuer covenants and agrees that it shall take any
and all reasonable action, including the execution and filing of any and all
documents, that may be necessary to continue the designation of the Process
Agent above in full force and effect, and to cause the Process Agent to act as
such. The Issuer further covenants and agrees to maintain at all times an agent
with offices in New York City to act as its Process Agent. Nothing herein shall
in any way be deemed to limit the ability to serve any such writs, process or
summonses in any other manner permitted by applicable law.
Section 13.11. No Recourse Against Others. No director, officer,
employee, incorporator or holder of any Equity Interests in the Issuer or any
direct or indirect parent, as such, shall have any liability for any obligations
of the Issuer under the Notes or this Indenture or for any claim based on, in
respect of, or by any reason of, such obligations or their creation. Each Holder
of Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Notes.
Section 13.12. Successors. All agreements of the Issuer in this
Indenture and the Notes shall bind their successors. All agreements of the
Trustee in this Indenture shall bind its successors.
Section 13.13. Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
Section 13.14. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
Section 13.15. Indenture Controls. If and to the extent that any
provision of the Notes limits, qualifies or conflicts with a provision of this
Indenture, such provision of this Indenture shall control.
Section 13.16. Severability. In case any provision in this Indenture
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby and such provision shall be ineffective only to the extent of
such invalidity, illegality or unenforceability.
70
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
RURAL/METRO CORPORATION
By:/s/ Xxxxxxx X. Zarrielo
-----------------------------------
Name: Xxxxxxx X. Zarrielo
Title: Senior Vice President and
Chief Financial Officer
[SIGNATURES CONTINUE ON THE FOLLOWING PAGE]
71
XXXXX FARGO BANK, N.A., as Trustee
By:/s/ Xxxxx XxXxxxxx
-----------------------------------
Name: Xxxxx XxXxxxxx
Title: Vice President
72
APPENDIX A
PROVISIONS RELATING TO INITIAL SECURITIES,
ADDITIONAL SECURITIES AND EXCHANGE SECURITIES
1. Definitions.
-----------
1.1 Definitions.
For the purposes of this Appendix A the following terms shall have
the meanings indicated below:
"CLEARSTREAM" means Clearstream Banking, societe anonyme, or any
successor securities clearing agency.
"DEFINITIVE NOTE" means a certificated Initial Note or Exchange Note
(bearing the Restricted Notes Legend if the transfer of such Note is restricted
by applicable law) that does not include the Global Notes Legend.
"DEPOSITORY" means The Depository Trust Company, its nominees and
their respective successors.
"EUROCLEAR" means the Euroclear Clearance System or any successor
securities clearing agency.
"GLOBAL NOTES LEGEND" means the legend set forth under that caption
in Exhibits A and B to this Indenture.
"IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"INITIAL PURCHASERS" means, collectively, Citigroup Global Markets
Inc. and X.X. Xxxxxx Securities Inc.
"PURCHASE AGREEMENT" means (a) the Purchase Agreement dated February
28, 2005 among the Issuer and the Initial Purchasers and (b) any other similar
Purchase Agreement relating to Additional Notes.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"REGISTERED EXCHANGE OFFER" means the offer by the Issuer, pursuant
to the Registration Rights Agreement, to certain Holders of Initial Notes, to
issue and deliver to such Holders, in exchange for their Initial Notes, a like
aggregate principal amount at maturity of Exchange Notes registered under the
Securities Act.
"REGISTRATION DEFAULT DAMAGES" has the meaning set forth in the
Registration Rights Agreement.
"REGISTRATION RIGHTS AGREEMENT" means (a) the Registration Rights
Agreement dated as of March 4, 2005 among the Issuer and the Initial Purchasers
relating to the Notes and (b) any other similar Registration Rights Agreement
relating to Additional Notes.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S SECURITIES" means all Initial Notes offered and sold
outside the United States in reliance on Regulation S.
"RESTRICTED NOTES LEGEND" means the legends set forth in Sections
2.2(f)(i) herein.
"RESTRICTED PERIOD", with respect to any Notes, means the period of
40 consecutive days beginning on and including the later of (a) the day on which
such Notes are first offered to persons other than distributors (as defined in
Regulation S under the Securities Act) in reliance on Regulation S, notice of
which day shall be promptly given by the Issuer to the Trustee, and (b) the
Issue Date, and with respect to any Additional Notes that are Transfer
Restricted Notes, it means the comparable period of 40 consecutive days.
"RULE 501" means Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
"RULE 144A" means Rule 144A under the Securities Act.
"RULE 144A NOTES" means all Initial Notes offered and sold to QIBs in
reliance on Rule 144A.
"SECURITIES CUSTODIAN" means the custodian with respect to a Global
Note (as appointed by the Depository) or any successor person thereto, who shall
initially be the Trustee.
"SHELF REGISTRATION STATEMENT" means a registration statement filed
by the Issuer in connection with the offer and sale of Initial Notes pursuant to
the Registration Rights Agreement.
"TRANSFER RESTRICTED NOTES" means Definitive Notes and any other
Notes that bear or are required to bear or are subject to the Restricted
Securities Legend.
"UNRESTRICTED DEFINITIVE NOTE" means Definitive Notes and any other
Notes that are not required to bear, or are not subject to, the Restricted
Securities Legend.
2. The Notes.
---------
2.1 Form and Dating; Global Notes. (a) The Initial Notes issued on
the date hereof will be (i) offered and sold by the Issuer pursuant to the
Purchase Agreement and (ii) resold, initially only to (1) QIBs in reliance on
Rule 144A and (2) Persons other than U.S. Persons (as defined in Regulation S)
in reliance on Regulation S. Such Initial Notes may thereafter be transferred
to, among others, QIBs, purchasers in reliance on Regulation S and, except as
set forth below, IAIs in accordance with Rule 501. Additional Notes offered
after the date hereof may be offered and sold by the Issuer from time to time
pursuant to one or more Purchase Agreements in accordance with applicable law.
2
(b) Global Notes. (i) Rule 144A Notes initially shall be represented
by one or more Notes in fully registered, global form without interest coupons
(collectively, the "RESTRICTED GLOBAL NOTES"). Regulation S Notes initially
shall be represented by one or more Notes in fully registered, global form
without interest coupons (collectively, the "REGULATION S GLOBAL NOTES"). The
term "GLOBAL NOTES" means the Restricted Global Notes and the Regulation S
Global Notes. The Global Notes shall bear the Global Note Legend. The Global
Notes initially shall (i) be registered in the name of the Depository or the
nominee of such Depository, in each case for credit to an account of an Agent
Member (as defined below), (ii) be delivered to the Trustee as custodian for
such Depository and (iii) bear the Restricted Notes Legend.
Members of, or direct or indirect participants in, the Depository,
Euroclear or Clearstream ("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 Notes. The
Depository may be treated by the Issuer, the Trustee and any agent of the Issuer
or the Trustee as the absolute owner of the Global Notes for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect
to any written certification, proxy or other authorization furnished by the
Depository or impair, as between the Depository, Euroclear or Clearstream, as
the case may be, and their respective Agent Members, the operation of customary
practices governing the exercise of the rights of a Holder of any Note.
(ii) Transfers of Global Notes shall be limited to transfer 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 Definitive Notes only in accordance with the applicable rules and
procedures of the Depository, Euroclear or Clearstream, as the case may be, and
the provisions of Section 2.2. All Global Notes shall be exchanged by the Issuer
for Definitive Notes if (i) the Issuer delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and, in
either case, a successor Depositary is not appointed by the Issuer within 90
days after the date of such notice from the Depositary; (ii) the Issuer in its
sole discretion determines that the Global Notes (in whole but not in part)
should be exchanged for Definitive Notes and delivers a written notice to such
effect to the Trustee; provided that in no event shall the Regulation S
Temporary Global Note be exchanged by the Issuer for Definitive Notes prior to
(x) the expiration of the Restricted Period and (y) the receipt by the Registrar
of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the
Securities Act; or (iii) there shall have occurred and be continuing a Default
or Event of Default with respect to the Notes. Upon the occurrence of any of the
preceding events in (i), (ii) or (iii) above, Definitive Notes shall be issued
in such names as the Depositary shall instruct the Trustee. In all cases,
Definitive Notes delivered in exchange for any Global Note or beneficial
interests therein shall be registered in the names, and issued in any approved
denominations, requested by or on behalf of the Depository in accordance with
its customary procedures.
3
(iii) In connection with the transfer of a Global Note as an entirety
to beneficial owners pursuant to subsection (i) of this Section 2.1(b), such
Global Note shall be deemed to be surrendered to the Trustee for cancellation,
and the Issuer shall execute, and the Trustee shall authenticate and make
available for delivery, to each beneficial owner identified by the Depository in
writing in exchange for its beneficial interest in such Global Note, an equal
aggregate principal amount at maturity of Definitive Notes of authorized
denominations.
(iv) Any Transfer Restricted Security delivered in exchange for an
interest in a Global Note pursuant to Section 2.2 shall, except as otherwise
provided in Section 2.2, bear the Restricted Notes Legend.
(v) Notwithstanding the foregoing, through the Restricted Period, a
beneficial interest in a Regulation S Global Note may be held only through
Euroclear or Clearstream unless delivery is made in accordance with the
applicable provisions of Section 2.2.
(vi) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
2.2 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except as set forth in Section 2.1(b). Global Notes will
not be exchanged by the Issuer for Definitive Notes except under the
circumstances described in Section 2.1(b)(ii). Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.08 and
2.10 of this Indenture. Beneficial interests in a Global Note may be transferred
and exchanged as provided in Section 2.2(b) or 2.2(g).
(b) Transfer and Exchange of Beneficial Interests in Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depository, in accordance with the provisions of this
Indenture and the applicable rules and procedures of the Depository. Beneficial
interests in Restricted Global Notes shall be subject to restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act. Transfers and exchanges of beneficial interests in the Global
Notes also shall require compliance with either subparagraph (i) or (ii) below,
as applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Restricted Notes Legend;
provided, however, that prior to the expiration of the Restricted
Period, transfers of beneficial interests in a Regulation S Global
Note may not be made to a U.S. Person or for the account or benefit of
a U.S. Person (other than an Initial Purchaser). No written orders or
instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.2(b)(i).
4
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests in any Global Note that is not subject to Section
2.2(b)(i), the transferor of such beneficial interest must deliver to
the Registrar (1) a written order from an Agent Member given to the
Depository in accordance with the applicable rules and procedures of
the Depository directing the Depository to credit or cause to be
credited a beneficial interest in another Global Note in an amount
equal to the beneficial interest to be transferred or exchanged and
(2) instructions given in accordance with the applicable rules and
procedures of the Depository containing information regarding the
Agent Member account to be credited with such increase. Upon
satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and
the Notes or otherwise applicable under the Securities Act, the
Trustee shall adjust the principal amount at maturity of the relevant
Global Note pursuant to Section 2.2(g).
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in a Transfer Restricted Global
Note may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in another Transfer Restricted Global
Note if the transfer complies with the requirements of Section
2.2(b)(ii) above and the Registrar receives a certificate from the
transferor in the form attached to the applicable Note.
(iv) Transfer and Exchange of Beneficial Interests in a Transfer
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in a Transfer Restricted Global
Note may be exchanged by any holder thereof for a beneficial interest
in an Unrestricted Global Note or transferred to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note if the exchange or transfer complies with the
requirements of Section 2.2(b)(ii) above and the Registrar receives
the following:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form attached to the
applicable Note; or
(B) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form attached to the
applicable Note,
and, in each such case, if the Registrar so requests or if the
applicable rules and procedures of the Depository, Euroclear or
Clearstream, as applicable, so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that
such exchange or transfer is in compliance with the Securities
Act and that the restrictions on transfer contained herein and in
the Restricted Notes Legend are no longer required in order to
maintain compliance with the Securities Act. If any such transfer
or exchange is effected pursuant to this subparagraph (iv) at a
5
time when an Unrestricted Global Note has not yet been issued,
the Issuer shall issue and, upon receipt of an written order of
the Issuer in the form of an Officers' Certificate in accordance
with Section 2.01, the Trustee shall authenticate one or more
Unrestricted Global Securities in an aggregate principal amount
at maturity equal to the aggregate principal amount at maturity
of beneficial interests transferred or exchanged pursuant to this
subparagraph (iv).
(v) Transfer and Exchange of Beneficial Interests in an
Unrestricted Global Note for Beneficial Interests in a Restricted
Global Note. Beneficial interests in an Unrestricted Global Note
cannot be exchanged for, or transferred to Persons who take delivery
thereof in the form of, a beneficial interest in a Restricted Global
Note.
(c) Transfer and Exchange of Beneficial Interests in Global Notes for
Definitive Notes. A beneficial interest in a Global Note may not be exchanged
for a Definitive Note except under the circumstances described in Section
2.1(b)(ii). A beneficial interest in a Global Note may not be transferred to a
Person who takes delivery thereof in the form of a Definitive Note except under
the circumstances described in Section 2.1(b)(ii).
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests in Global Notes. Definitive Notes shall be transferred or exchanged
only for beneficial interests in Global Notes. Transfers and exchanges of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i), (ii) or (ii) below, as applicable:
(i) Transfer Restricted Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Transfer Restricted
Security proposes to exchange such Transfer Restricted Security for a
beneficial interest in a Restricted Global Note or to transfer such
Transfer Restricted Security to a Person who takes delivery thereof in
the form of a beneficial interest in a Restricted Global Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Transfer Restricted Security
proposes to exchange such Transfer Restricted Security for a
beneficial interest in a Restricted Global Note, a certificate
from such Holder in the form attached to the applicable Note;
(B) if such Transfer Restricted Security is being
transferred to a Qualified Institutional Buyer in accordance with
Rule 144A under the Securities Act, a certificate from such
Holder in the form attached to the applicable Note;
(C) if such Transfer Restricted Security is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a
certificate from such Holder in the form attached to the
applicable Note;
(D) if such Transfer Restricted Security is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144
under the Securities Act, a certificate from such Holder in the
form attached to the applicable Note;
6
(E) if such Transfer Restricted Security is being
transferred to an Institutional Accredited Investor in reliance
on an exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs (B)
through (D) above, a certificate from such Holder in the form
attached to the applicable Note, including the certifications,
certificates and Opinion of Counsel, if applicable; or
(F) if such Transfer Restricted Security is being
transferred to the Issuer or a Subsidiary thereof, a certificate
from such Holder in the form attached to the applicable Note;
the Trustee shall cancel the Transfer Restricted Security, and increase or
cause to be increased the aggregate principal amount at maturity of the
appropriate Restricted Global Note.
(ii) Transfer Restricted Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Transfer Restricted Security
may exchange such Transfer Restricted Definitive Note for a beneficial
interest in an Unrestricted Global Note or transfer such Transfer
Restricted Security to a Person who takes delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note only if the
Registrar receives the following:
(A) if the Holder of such Transfer Restricted Security
proposes to exchange such Transfer Restricted Security for a
beneficial interest in an Unrestricted Global Note, a certificate
from such Holder in the form attached to the applicable Note; or
(B) if the Holder of such Transfer Restricted Notes proposes
to transfer such Transfer Restricted Security to a Person who
shall take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note, a certificate from such Holder in
the form attached to the applicable Note,
and, in each such case, if the Registrar so requests or if the applicable
rules and procedures of the Depository, Euroclear or Clearstream, as
applicable, so require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on transfer
contained herein and in the Restricted Notes Legend are no longer required
in order to maintain compliance with the Securities Act. Upon satisfaction
of the conditions of this subparagraph (ii), the Trustee shall cancel the
Transfer Restricted Notes and increase or cause to be increased the
aggregate principal amount at maturity of the Unrestricted Global Note.. If
any such transfer or exchange is effected pursuant to this subparagraph
(ii) at a time when an Unrestricted Global Note has not yet been issued,
the Issuer shall issue and, upon receipt of an written order of the Issuer
in the form of an Officers' Certificate, the Trustee shall authenticate one
or more Unrestricted Global Notes in an aggregate principal amount at
maturity equal to the aggregate principal amount at maturity of Transfer
Restricted Notes transferred or exchanged pursuant to this subparagraph
(ii).
7
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Unrestricted Definitive Note for a beneficial
interest in an Unrestricted Global Note or transfer such Unrestricted
Definitive Note to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note at any time. Upon
receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Unrestricted Definitive Note and increase
or cause to be increased the aggregate principal amount at maturity of
one of the Unrestricted Global Notes. If any such transfer or exchange
is effected pursuant to this subparagraph (iii) at a time when an
Unrestricted Global Note has not yet been issued, the Issuer shall
issue and, upon receipt of an written order of the Issuer in the form
of an Officers' Certificate, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount at
maturity equal to the aggregate principal amount at maturity of
Unrestricted Definitive Notes transferred or exchanged pursuant to
this subparagraph (iii).
(iv) Unrestricted Definitive Notes to Beneficial Interests in
Restricted Global Securities. An Unrestricted Definitive Note cannot
be exchanged for, or transferred to a Person who takes delivery
thereof in the form of, a beneficial interest in a Restricted Global
Note.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.2(e), the Registrar shall register the transfer
or exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.2(e).
(i) Transfer Restricted Notes to Transfer Restricted Notes. A
Transfer Restricted Security may be transferred to and registered in
the name of a Person who takes delivery thereof in the form of a
Transfer Restricted Security if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a
certificate in the form attached to the applicable Note;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904 under the Securities Act, then the transferor must
deliver a certificate in the form attached to the applicable
Note;
8
(C) if the transfer will be made pursuant to an exemption
from the registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a certificate
in the form attached to the applicable Note;
(D) if the transfer will be made to an IAI in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (A) through (D)
above, a certificate in the form attached to the applicable Note;
and
(E) if such transfer will be made to the Issuer or a
Subsidiary thereof, a certificate in the form attached to the
applicable Note.
(ii) Transfer Restricted Notes to Unrestricted Definitive Notes.
Any Transfer Restricted Security may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person
who takes delivery thereof in the form of an Unrestricted Definitive
Note if the Registrar receives the following:
(1) if the Holder of such Transfer Restricted Security
proposes to exchange such Transfer Restricted Security for an
Unrestricted Definitive Note, a certificate from such Holder in
the form attached to the applicable Note; or
(2) if the Holder of such Transfer Restricted Security
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note,
a certificate from such Holder in the form attached to the
applicable Note,
and, in each such case, if the Registrar so requests, an Opinion of Counsel
in form reasonably acceptable to the Issuer to the effect that such
exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Restricted Notes
Legend are no longer required in order to maintain compliance with the
Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of an Unrestricted Definitive Note may transfer such
Unrestricted Definitive Notes to a Person who takes delivery thereof
in the form of an Unrestricted Definitive Note at any time. Upon
receipt of a request to register such a transfer, the Registrar shall
register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof.
(iv) Unrestricted Definitive Notes to Transfer Restricted Notes.
An Unrestricted Definitive Note cannot be exchanged for, or
transferred to a Person who takes delivery thereof in the form of, a
Transfer Restricted Security.
At such time as all beneficial interests in a particular Global Note
have been exchanged for Definitive Notes or a particular Global Note has been
redeemed, repurchased or canceled in whole and not in part, each such Global
Note shall be returned to or retained and canceled by the Trustee in accordance
with Section 2.11. At any time prior to such cancellation, if any beneficial
interest in a Global Note is exchanged for or transferred to a Person who will
take delivery thereof in the form of a beneficial interest in another Global
9
Note or for Definitive Notes, the principal amount at maturity of Notes
represented by such Global Note shall be reduced accordingly and an endorsement
shall be made on such Global Note by the Trustee or by the Depository at the
direction of the Trustee to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note,
such other Global Note shall be increased accordingly and an endorsement shall
be made on such Global Note by the Trustee or by the Depository at the direction
of the Trustee to reflect such increase.
(f) Legend.
(i) Except as permitted by the following paragraphs (iii), (iv) or
(v), each Note certificate evidencing the Global Notes and the Definitive Notes
(and all Notes issued in exchange therefor or in substitution thereof) shall
bear a legend in substantially the following form (each defined term in the
legend being defined as such for purposes of the legend only):
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), OR (B)
IT IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE
WITH REGULATION S UNDER THE SECURITIES ACT;
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES
ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE
10
OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT AT MATURITY OF SECURITIES LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER, IF THE
ISSUER SO REQUESTS, THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER), OR (G) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE GOVERNING THIS SECURITY CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS SECURITY IN VIOLATION OF THE FOREGOING."
Each Definitive Note shall bear the following additional legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION
AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE
TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer Restricted Security that
is a Definitive Note, the Registrar shall permit the Holder thereof to exchange
such Transfer Restricted Security for a Definitive Note that does not bear the
legends set forth above and rescind any restriction on the transfer of such
Transfer Restricted Security if the Holder certifies in writing to the Registrar
that its request for such exchange was made in reliance on Rule 144 (such
certification to be in the form set forth on the reverse of the Initial Note).
(iii) After a transfer of any Initial Notes during the period of the
effectiveness of a Shelf Registration Statement with respect to such Initial
Notes, all requirements pertaining to the Restricted Notes Legend on such
Initial Notes shall cease to apply and the requirements that any such Initial
Notes be issued in global form shall continue to apply.
11
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Notes pursuant to which Holders of such Initial Notes are
offered Exchange Notes in exchange for their Initial Notes, all requirements
pertaining to Initial Notes that Initial Notes be issued in global form shall
continue to apply, and Exchange Notes in global form without the Restricted
Notes Legend shall be available to Holders that exchange such Initial Notes in
such Registered Exchange Offer.
(v) Upon a sale or transfer after the expiration of the Restricted
Period of any Initial Note acquired pursuant to Regulation S, all requirements
that such Initial Note bear the Restricted Notes Legend shall cease to apply and
the requirements requiring any such Initial Note be issued in global form shall
continue to apply.
(vi) Any Additional Notes sold in a registered offering shall not be
required to bear the Restricted Notes Legend.
(g) Cancellation or Adjustment of Global Note. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 of this
Indenture. At any time prior to such cancellation, if any beneficial interest in
a Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for
Definitive Notes, the principal amount at maturity of Notes represented by such
Global Note shall be reduced accordingly and an endorsement shall be made on
such Global Note by the Trustee or by the Depository at the direction of the
Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
shall be increased accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depository at the direction of the Trustee to
reflect such increase.
(h) Obligations with Respect to Transfers and Exchanges of Notes.
(i) To permit registrations of transfers and exchanges, the Issuer
shall execute and the Trustee shall authenticate, Definitive Notes and Global
Notes at the Registrar's request.
(ii) No service charge shall be made for any registration of transfer
or exchange, but the Issuer may require payment of a sum sufficient to cover any
transfer tax, assessments, or similar governmental charge payable in connection
therewith (other than any such transfer taxes, assessments or similar
governmental charge payable upon exchanges pursuant to Sections 3.03(c), 4.06,
4.08 and 9.05 of this Indenture).
(iii) Prior to the due presentation for registration of transfer of
any Note, the Issuer, the Trustee, a Paying Agent or the 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 on
such Note and for all other purposes whatsoever, whether or not such Note is
overdue, and none of the Issuer, the Trustee, a Paying Agent or the Registrar
shall be affected by notice to the contrary.
12
(iv) All Notes issued upon any transfer or exchange pursuant to the
terms of this Indenture shall evidence the same debt and shall be entitled to
the same benefits under this Indenture as the Notes surrendered upon such
transfer or exchange.
(i) No Obligation of the Trustee. (i) The Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Note, a member
of, or a participant in the Depository or any other Person with respect to the
accuracy of the records of the Depository or its nominee or of any participant
or member thereof, with respect to any ownership interest in the Notes or with
respect to the delivery to any participant, member, beneficial owner or other
Person (other than the Depository) of any notice (including any notice of
redemption or repurchase) or the payment of any amount, under or with respect to
such Notes. All notices and communications to be given to the Holders and all
payments to be made to the Holders under the Notes shall be given or made only
to the registered Holders (which shall be the Depository or its nominee in the
case of a Global Note). The rights of beneficial owners in any Global Note shall
be exercised only through the Depository subject to the applicable rules and
procedures of the Depository. The Trustee may rely and shall be fully protected
in relying upon information furnished by the Depository with respect to its
members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Note (including any transfers between or among Depository
participants, members or beneficial owners in any Global Note) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
13
EXHIBIT A
[FORM OF FACE OF INITIAL NOTE]
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE IN DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Notes Legend]
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") THAT IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE OF THESE SECURITIES AND THE LAST DATE ON WHICH RURAL/METRO
CORPORATION, OR ANY OF ITS AFFILIATES, WAS THE OWNER OF THESE SECURITIES (OR ANY
PREDECESSOR OF THESE SECURITIES), EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY
ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), OR (B) IT IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT;
A-1
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES
ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE
OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT AT MATURITY OF SECURITIES LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER, IF THE
ISSUER SO REQUESTS, THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER), OR (G) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY
OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT..
THE INDENTURE GOVERNING THIS SECURITY CONTAINS A PROVISION REQUIRING THE TRUSTEE
TO REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING.
Each Definitive Note shall bear the following additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
A-2
[FORM OF INITIAL NOTE]
No. 12 3/4% Senior Discount Note due 2016
CUSIP No. ____
ISIN No. ____
RURAL/METRO CORPORATION, a Delaware corporation, promises to pay to [
], or registered assigns, the principal sum [of Dollars] [listed on the Schedule
of Increases or Decreases in Global Security attached hereto] on March 15, 2016.
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
Additional provisions of this Note are set forth on the other side of
this Note.
IN WITNESS WHEREOF, Rural/Metro Corporation has caused this
instrument to be duly executed.
RURAL/METRO CORPORATION
By:
---------------------------------
Name:
Title:
Dated:
A-3
TRUSTEE'S CERTIFICATION OF
AUTHENTICATION
Xxxxx Fargo Bank, N.A.,
as Trustee, certifies that this is one of the
Notes referred to in the Indenture
By:
---------------------------------
Authorized Signatory
Title:
--------------------------------------------------------------------------------
*/ If the Note is to be issued in global form, add the Global Notes Legend and
the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".
A-4
[FORM OF REVERSE SIDE OF INITIAL NOTE]
12 3/4% Senior Discount Note due 2016
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF
SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. FOR EACH $1,000
PRINCIPAL AMOUNT AT MATURITY OF THIS NOTE, THE ISSUE PRICE IS $536.99.
THE ISSUE DATE OF THIS NOTE IS MARCH 4, 2005 AND THE YIELD TO MATURITY
IS 12 3/4%.
1. Interest
--------
(a) RURAL/METRO CORPORATION, a Delaware corporation (together with
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Issuer"), promises to pay interest on this Note at the rate
per annum specified below. The Notes will bear interest at the rate per annum of
12 3/4%. Prior to March 15, 2010, interest will accrue on the Notes in the form
of an increase in the Accreted Value of the Notes, and no cash interest will be
paid. The Accreted Value of the Notes will increase from the date of issuance
until March 15, 2010 at a rate of 12 3/4% per annum compounded semiannually such
that the Accreted Value will equal the principal amount at maturity on March 15,
2010. The Issuer shall pay interest semiannually in arrears in cash on each
March 15 and September 15, commencing on September 15, 2010. Interest on the
Notes shall accrue from the most recent date to which interest has been paid or
duly provided for or, if no interest has been paid or duly provided for, from
March 15, 2015 until the principal hereof is due. Interest shall be computed on
the basis of a 360-day year of twelve 30-day months. The Issuer shall pay
interest on overdue principal at the rate borne by the Notes, and they shall pay
interest on overdue installments of interest at the same rate to the extent
lawful.
For purposes of the preceding paragraph, the following term shall
have the following definition:
"Accreted Value" means, as of any date (the "Specified Date"), the
amount provided below for each $1,000 principal amount at maturity of Notes:
(1) if the Specified Date occurs on one of the following dates
(each, a "Semi-Annual Accrual Date"), the Accreted Value will equal
the amount set forth below for such Semi-Annual Accrual Date:
SEMI-ANNUAL ACCRUAL DATE ACCRETED VALUE
September 15, 2005 $ 573.38
March 15, 2006 $ 609.93
September 15, 2006 $ 648.82
March 15, 2007 $ 690.18
September 15, 2007 $ 734.18
March 15, 2008 $ 780.98
September 15, 2008 $ 830.77
March 15, 2009 $ 883.73
September 15, 2009 $ 940.07
March 15, 2010 $ 1,000.00
A-5
the foregoing Accreted Values shall be increased, if necessary, to
reflect any accretion of Registration Default Damages;
(2) if the Specified Date occurs before the first Semi-Annual
Accrual Date, the Accreted Value will equal the sum of (A) the
original issue price of a Note and (B) an amount equal to the product
of (x) the Accreted Value for the first Semi-Annual Accrual Date less
such original issue price multiplied by (y) a fraction, the numerator
of which is the number of days from the Issue Date to the Specified
Date, using a 360-day year of twelve 30-day months, and the
denominator of which is the number of days elapsed from the Issue Date
to the first Semi-Annual Accrual Date, using a 360-day year of twelve
30-day months;
(3) if the Specified Date occurs between two Semi-Annual Accrual
Dates, the Accreted Value will equal the sum of (A) the Accreted Value
for the Semi-Annual Accrual Date immediately preceding such Specified
Date and (B) an amount equal to the product of (x) the Accreted Value
for the immediately following Semi-Annual Accrual Date less the
Accreted Value for the Semi-Annual Accrual Date immediately preceding
such Specified Date multiplied by (y) a fraction, the numerator of
which is the number of days from the immediately preceding Semi-Annual
Accrual Date to the Specified Date, using a 360-day year of twelve
30-day months, and the denominator of which is 180; or
(4) if the Specified Date occurs on or after the Full Accretion
Date, the Accreted Value will equal $1,000.
(b) Registration Rights Agreement. The Holder of this Note is entitled
to the benefits of a Registration Rights Agreement, dated as of March 4, 2005,
among the Issuer and the Initial Purchasers named therein.
2. Method of Payment
-----------------
On and after September 15, 2010, the Issuer shall pay interest on the
Notes (except defaulted interest) to the Persons who are registered Holders at
the close of business on the March 1 or September 1 immediately preceding the
applicable interest payment date even if Notes are canceled after the record
date and on or before the interest payment date (whether or not a Business Day).
Holders must surrender the Notes to a Paying Agent to collect principal
payments. The Issuer shall pay Accreted Value, premium, if any, and interest in
money of the United States of America that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of the Notes
represented by a Global Note (including Accreted Value, premium, if any, and
interest) shall be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company, an Issuer or any successor
depositary. The Issuer will make all payments in respect of a certificated Note
(including Accreted Value, premium, if any, and interest), at the office of each
Paying Agent, except that, at the option of the Issuer, payment of interest may
be made by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on the Notes may also be made, in the case of a
A-6
Holder of at least $1,000,000 aggregate principal amount at maturity of the
Notes, by wire transfer to a U.S. dollar account maintained by the payee with a
bank in the United States if such Holder elects payment by wire transfer by
giving written notice to the Trustee or a Paying Agent to such effect
designating such account no later than 30 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
--------------------------
Initially, Xxxxx Fargo Bank, N.A., a national banking association
(the "Trustee"), will act as Paying Agent and Registrar. The Issuer may appoint
and change any Paying Agent or Registrar without notice. The Issuer may act as
Paying Agent or Registrar.
4. Indenture
---------
The Issuer issued the Notes under an Indenture dated as of March 4,
2005 (the "Indenture"), among the Issuer and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 as in effect on the date of the
Indenture (the "TIA"). Terms defined in the Indenture and not defined herein
have the meanings ascribed thereto in the Indenture. The Notes are subject to
all terms and provisions of the Indenture, and the Holders (as defined in the
Indenture) are referred to the Indenture and the TIA for a statement of such
terms and provisions.
The Notes are senior unsecured obligations of the Issuer. This Note
is one of the Initial Notes referred to in the Indenture. The Notes include the
Initial Notes and any Exchange Notes issued in exchange for Initial Notes
pursuant to the Indenture. The Indenture imposes certain limitations on the
ability of the Issuer and the Issuer's Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, enter into consensual restrictions
upon the payment of certain dividends and distributions by such Restricted
Subsidiaries, issue or sell shares of capital stock of Restricted Subsidiaries,
enter into or permit certain transactions with Affiliates, create or incur Liens
and make asset sales. The Indenture also imposes limitations on the ability of
the Issuer to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of its property.
5. Redemption and Repurchase
-------------------------
(a) The Notes will be redeemable, at the Issuer's option, in whole at
any time or in part from time to time, on and after March 15, 2010 at the
following redemption prices (expressed as percentages of Accreted Value thereof)
if redeemed during the twelve-month period commencing on March 15 of the
applicable year set forth below, plus, in each case, accrued and unpaid
interest, if any, to the date of redemption:
A-7
YEAR PERCENTAGE
---- ----------
2010 106.375%
2011 104.250%
2012 102.125%
2013 and thereafter 100.000%
(b) In addition, prior to March 15, 2010, the Issuer may redeem the
Notes at its option, in whole or in part from time to time, upon not less than
30 nor more than 60 days' prior notice mailed by first-class mail to each
holder's registered address, at a redemption price equal to 100% of the
aggregate Accreted Value of the Notes redeemed plus the Applicable Premium as
of, and accrued and unpaid interest and Registration Default Damages, if any, to
the applicable redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant interest payment
date).
(c) At any time, or from time to time, on or prior to March 15, 2008,
the Issuer may, at its option, use all or any portion of the net cash proceeds
of one or more Equity Offerings to redeem up to 35% of the aggregate principal
amount at maturity of the Notes issued at a redemption price equal to 112.75% of
the Accreted Value thereof plus accrued and unpaid interest, if any, to the date
of redemption; provided that at least 65% of the aggregate principal amount at
maturity of Notes originally issued remains outstanding immediately after any
such redemption. In order to effect the foregoing redemption with the proceeds
of any Equity Offering, the Issuer shall consummate such redemption not more
than 90 days after the consummation of any such Equity Offering.
6. Sinking Fund
------------
The Notes are not entitled to the benefit of any mandatory sinking
fund.
7. [Reserved]
----------
8. Denominations; Transfer; Exchange
---------------------------------
The Notes are in registered form, without coupons, in denominations
of $1,000 and whole multiples of $1,000 in excess thereof. A Holder shall
register the transfer of or exchange of Notes in accordance with the Indenture.
Upon any registration of transfer or exchange, the Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Notes
selected for redemption (except, in the case of a Note to be redeemed in part,
the portion of the Notes not to be redeemed) or to transfer or exchange any
Notes for a period of 15 days prior to a selection of Notes to be redeemed.
9. Persons Deemed Owners
---------------------
The registered Holder of this Note shall be treated as the owner of
it for all purposes.
A-8
10. Unclaimed Money
---------------
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and a Paying Agent shall pay the money back to the
Issuer at its written request unless an abandoned property law designates
another Person. After any such payment, the Holders entitled to the money must
look to the Issuer for payment as general creditors and the Trustee and a Paying
Agent shall have no further liability with respect to such monies.
11. Discharge and Defeasance
------------------------
Subject to certain conditions, the Issuer at any time may terminate
some of or all of their obligations under the Notes and the Indenture if the
Issuer deposits with the Trustee money or Government Securities for the payment
of principal of, and interest on the Notes to redemption, or maturity, as the
case may be.
12. Amendment, Waiver
-----------------
Subject to certain exceptions set forth in the Indenture, the
Indenture and the Notes may be amended, or default may be waived, with the
consent of the Holders of a majority in principal amount at maturity of the
outstanding Notes. Without notice to or the consent of any Holder, the Issuer
and the Trustee may amend or supplement the Indenture or the Notes to, among
other things, cure any ambiguity, defect or inconsistency.
13. Defaults and Remedies
If an Event of Default occurs (other than an Event of Default
relating to certain events of bankruptcy, insolvency or reorganization of the
Issuer) and is continuing, the Trustee or the Holders of at least 25% in
principal amount at maturity of the outstanding Notes, in each case, by notice
to the Issuer, may declare the Accreted Value of, premium, if any, and accrued
but unpaid interest on all the Notes to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Issuer occurs, the Accreted Value of, premium, if any, and interest on
all the Notes shall become immediately due and payable without any declaration
or other act on the part of the Trustee or any Holders. Under certain
circumstances, the Holders of a majority in principal amount at maturity of the
outstanding Notes may rescind any such acceleration with respect to the Notes
and its consequences.
14. Trustee Dealings with the Issuer
--------------------------------
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with and collect obligations owed to it
by the Issuer or its Affiliates and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Trustee.
15. No Recourse Against Others
--------------------------
No director, officer, employee, incorporator or holder of any equity
interests in the Issuer or any direct or indirect parent, as such, shall have
any liability for any obligations of the Issuer under the Notes or this
Indenture or for any claim based on, in respect of, or by any reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability.
A-9
16. Authentication
--------------
This Note shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Note.
17. Abbreviations
-------------
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
18. Governing Law
-------------
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
19. CUSIP Numbers, ISINs and Common Codes
-------------------------------------
The Issuer has caused CUSIP numbers and ISINs to be printed on the
Notes and has directed the Trustee to use CUSIP numbers and ISINs in notices of
redemption as a convenience to the Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
THE ISSUER WILL FURNISH TO ANY HOLDER OF NOTES UPON WRITTEN REQUEST
AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH HAS IN IT THE
TEXT OF THIS NOTE.
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below: I or we assign and transfer this
Note to:
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Note on the books of the Issuer.
The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your Signature:
------------- -------------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Signature Guarantee:
Date:
------------- -------------------------------------
Signature must be guaranteed by a Signature of Signature Guarantee
participant in a recognized signature
guaranty medallion program or other
signature guarantor program reasonably
acceptable to the Trustee
A-11
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER RESTRICTED NOTES
This certificate relates to $_________ principal amount at maturity
of Notes held in (check applicable space) ____ book-entry or _____ definitive
form by the undersigned.
The undersigned (check one box below):
[_] has requested the Trustee by written order to deliver in exchange
for its beneficial interest in the Global Note held by the
Depository a Note or Notes in definitive, registered form of
authorized denominations and an aggregate principal amount at
maturity equal to its beneficial interest in such Global Note (or
the portion thereof indicated above);
[_] has requested the Trustee by written order to exchange or
register the transfer of a Note or Notes.
In connection with any transfer of any of the Notes evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act, the undersigned confirms that such Notes are
being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [_] to the Issuer; or
(2) [_] to the Registrar for registration in the name of the Holder,
without transfer; or
(3) [_] pursuant to an effective registration statement under the
Securities Act of 1933; or
(4) [_] inside the United States to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of
1933) that purchases for its own account or for the account
of a qualified institutional buyer to whom notice is given
that such transfer is being made in reliance on Rule 144A,
in each case pursuant to and in compliance with Rule 144A
under the Securities Act of 1933; or
(5) [_] outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933
and such Security shall be held immediately after the
transfer through Euroclear or Clearstream until the
expiration of the Restricted Period (as defined in the
Indenture); or
(6) [_] to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933) that has furnished to the Trustee a signed letter
containing certain representations and agreements; or
A-12
(7) [_] pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of any
Person other than the registered Holder thereof; provided, however, that if box
(5), (6) or (7) is checked, the Trustee may require, prior to registering any
such transfer of the Notes, such legal opinions, certifications and other
information as the Issuer has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933.
Date:
------------- --------------------------------
Your Signature
Signature Guarantee:
Date: --------------------------------
Signature of Signature Guarantee
Signature must be guaranteed by a
participant in a recognized signature
guaranty medallion program or other
signature guarantor program reasonably
acceptable to the Trustee
--------------------------------------------------------------------------------
A-13
TO BE COMPLETED BY PURCHASER IF (4) 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 of
1933, 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 Issuer 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.
Date: ----------------------------------
---------------- NOTICE: To be executed by an
executive officer
A-14
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The initial principal amount at maturity of this Global Note is
$_________. The following increases or decreases in this Global Note have been
made:
Amount of decrease Amount of increase Principal amount at
in principal amount in principal amount maturity of this Global Signature of authorized
Date of at maturity of this at maturity of this Note following such signatory of Trustee or
Exchange Global Note Global Note decrease or increase Notes Custodian
-------- ----------- ----------- -------------------- ---------------
A-15
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer
pursuant to Section 4.06 (Asset Sale) or Section 4.08 (Change of Control) of the
Indenture, check the box:
Asset Sale [_] Change of Control [_]
If you want to elect to have only part of this Note purchased by the
Issuer pursuant to Section 4.06 (Asset Sale) or Section 4.08 (Change of Control)
of the Indenture, state the amount ($1,000 or an integral multiple of $1,000 in
excess thereof):
$
Dated: Your Signature:
------------ -----------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Signature Guarantee:
---------------------------------------------------------
Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other
signature guarantor program reasonably acceptable to the
Trustee
A-16
EXHIBIT B
[FORM OF FACE OF EXCHANGE NOTE]
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
B-1
No. 12 3/4% Senior Discount Note due 2016
CUSIP No. ______
ISIN No. ______
RURAL/METRO CORPORATION (the "Issuer"), a Delaware corporation,
promises to pay to [ ], or registered assigns, the principal sum [of Dollars]
[listed on the Schedule of Increases or Decreases in the Global Note attached
hereto] (1) on March 15, 2016.
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
Additional provisions of this Note are set forth on the other side of
this Note.
IN WITNESS WHEREOF, Rural/Metro Corporation has caused this
instrument to be duly executed.
RURAL/METRO CORPORATION
By:
-------------------------------
Name:
Title:
Dated:
----------------
(1) Use the Schedule of Increases and Decreases language if Security is in
Global Form.
B-2
TRUSTEE'S CERTIFICATION OF
AUTHENTICATION
Xxxxx Fargo Bank, N.A.,
as Trustee, certifies that this is one of the
Notes referred to in the Indenture
By:
---------------------------
Authorized Signatory
Title:
--------------------------------------------------------------------------------
*/ If the Note is to be issued in global form, add the Global Notes Legend and
the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".
B-3
[FORM OF REVERSE SIDE OF EXCHANGE NOTE]
12 3/4% Senior Discount Note due 2016
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF
SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. FOR EACH $1,000
PRINCIPAL AMOUNT AT MATURITY OF THIS NOTE, THE ISSUE PRICE IS $536.99.
THE ISSUE DATE OF THIS NOTE IS MARCH 4, 2005 AND THE YIELD TO MATURITY
IS 12 3/4%.
1. Interest
--------
(a) RURAL/METRO CORPORATION, a Delaware corporation (together with
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Issuer"), promises to pay interest on this Note at the rate
per annum specified below. The Notes will bear interest at the rate per annum of
12 3/4%. Prior to March 15, 2010, interest will accrue on the Notes in the form
of an increase in the Accreted Value of the Notes, and no cash interest will be
paid. The Accreted Value of the Notes will increase from the date of issuance
until March 15, 2010 at a rate of 12 3/4% per annum compounded semiannually such
that the Accreted Value will equal the principal amount at maturity on March 15,
2010. The Issuer shall pay interest semiannually in arrears in cash on each
March 15 and September 15, commencing on September 15, 2010. Interest on the
Notes shall accrue from the most recent date to which interest has been paid or
duly provided for or, if no interest has been paid or duly provided for, from
March 15, 2010 until the principal hereof is due. Interest shall be computed on
the basis of a 360-day year of twelve 30-day months. The Issuer shall pay
interest on overdue principal at the rate borne by the Notes, and they shall pay
interest on overdue installments of interest at the same rate to the extent
lawful.
For purposes of the preceding paragraph, the following term shall
have the following definition:
"Accreted Value" means, as of any date (the "Specified Date"), the
amount provided below for each $1,000 principal amount at maturity of Notes:
(1) if the Specified Date occurs on one of the following dates
(each, a "Semi-Annual Accrual Date"), the Accreted Value will equal
the amount set forth below for such Semi-Annual Accrual Date:
SEMI-ANNUAL ACCRUAL DATE ACCRETED VALUE
September 15, 2005 $ 573.38
March 15, 2006 $ 609.93
September 15, 2006 $ 648.82
March 15, 2007 $ 690.18
September 15, 2007 $ 734.18
March 15, 2008 $ 780.98
September 15, 2008 $ 830.77
March 15, 2009 $ 883.73
September 15, 2009 $ 940.07
March 15, 2010 $ 1,000.00
the foregoing Accreted Values shall be increased, if necessary, to
reflect any accretion of Registration Default Damages;
(2) if the Specified Date occurs before the first Semi-Annual
Accrual Date, the Accreted Value will equal the sum of (A) the
original issue price of a Note and (B) an amount equal to the product
of (x) the Accreted Value for the first Semi-Annual Accrual Date less
such original issue price multiplied by (y) a fraction, the numerator
of which is the number of days from the Issue Date to the Specified
Date, using a 360-day year of twelve 30-day months, and the
denominator of which is the number of days elapsed from the Issue Date
to the first Semi-Annual Accrual Date, using a 360-day year of twelve
30-day months;
B-4
(3) if the Specified Date occurs between two Semi-Annual
Accrual Dates, the Accreted Value will equal the sum of (A) the
Accreted Value for the Semi-Annual Accrual Date immediately preceding
such Specified Date and (B) an amount equal to the product of (x) the
Accreted Value for the immediately following Semi-Annual Accrual Date
less the Accreted Value for the Semi-Annual Accrual Date immediately
preceding such Specified Date multiplied by (y) a fraction, the
numerator of which is the number of days from the immediately preceding
Semi-Annual Accrual Date to the Specified Date, using a 360-day year of
twelve 30-day months, and the denominator of which is 180; or
(4) if the Specified Date occurs on or after the Full Accretion Date,
the Accreted Value will equal $1,000.
2. Method of Payment
-----------------
On and after September 15, 2010, the Issuer shall pay interest on the
Notes (except defaulted interest) to the Persons who are registered Holders at
the close of business on the March 1 or September 1 immediately preceding the
applicable interest payment date even if Notes are canceled after the record
date and on or before the interest payment date (whether or not a Business Day).
The Holders must surrender the Notes to a Paying Agent to collect principal
payments. The Issuer shall pay Accreted Value, premium, if any, and interest in
money of the United States of America that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of the Notes
represented by a Global Note (including Accreted Value, premium and interest)
shall be made by wire transfer of immediately available funds to the accounts
specified by The Depository Trust Company, the Issuer or any successor
depositary. The Issuer will make all payments in respect of a certificated Note
(including Accreted Value, premium, if any, and interest), at the office of a
Paying Agent, except that, at the option of the Issuer, payment of interest may
be made by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on the Notes may also be made, in the case of a
Holder of at least $1,000,000 aggregate principal amount at maturity of Notes,
by wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or a Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date for
payment (or such other date as the Trustee may accept in its discretion).
B-5
3. Paying Agent and Registrar
--------------------------
Initially, Xxxxx Fargo Bank, N.A., a national banking association
(the "Trustee"), will act as Paying Agent and Registrar. The Issuer may appoint
and change any Paying Agent or Registrar without notice. The Issuer may act as
Paying Agent or Registrar.
4. Indenture
---------
The Issuer issued the Notes under an Indenture dated as of March 4,
2005 (the "Indenture"), among the Issuer and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 as in effect on the date of the
Indenture (the "TIA"). Terms defined in the Indenture and not defined herein
have the meanings ascribed thereto in the Indenture. The Notes are subject to
all terms and provisions of the Indenture, and the Holders (as defined in the
Indenture) are referred to the Indenture and the TIA for a statement of such
terms and provisions.
The Notes are senior unsecured obligations of the Issuer. This Note
is one of the Exchange Notes referred to in the Indenture. The Notes include the
Initial Notes, the Additional Notes and any Exchange Notes issued in exchange
for the Initial Notes pursuant to the Indenture. The Initial Notes and Exchange
Notes are treated as a single class of securities under the Indenture. The
Indenture imposes certain limitations on the ability of the Issuer and the
Issuer's Restricted Subsidiaries to, among other things, make certain
Investments and other Restricted Payments, pay dividends and other
distributions, incur Indebtedness, enter into consensual restrictions upon the
payment of certain dividends and distributions by such Restricted Subsidiaries,
issue or sell shares of capital stock of Restricted Subsidiaries, enter into or
permit certain transactions with Affiliates, create or incur Liens and make
Asset Sales. The Indenture also imposes limitations on the ability of the Issuer
to consolidate or merge with or into any other Person or convey, transfer or
lease all or substantially all of its property.
5. Redemption and Repurchase
-------------------------
(a) The Notes will be redeemable, at the Issuer's option, in whole at
any time or in part from time to time, on and after March 15, 2010 at the
following redemption prices (expressed as percentages of the Accreted Value
thereof) if redeemed during the twelve-month period commencing on March 15 of
the applicable year set forth below, plus, in each case, accrued and unpaid
interest, if any, to the date of redemption:
YEAR PERCENTAGE
---- ----------
2010 106.375%
2011 104.250%
2012 102.125%
2013 and thereafter 100.000%
B-6
(b) In addition, prior to March 15, 2010, the Issuer may redeem the
Notes at its option, in whole or in part from time to time, upon not less than
30 nor more than 60 days' prior notice mailed by first-class mail to each
holder's registered address, at a redemption price equal to 100% of the
aggregate Accreted Value of the Notes redeemed plus the Applicable Premium as
of, and accrued and unpaid interest and Registration Default Damages, if any, to
the applicable redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant interest payment
date).
(c) At any time, or from time to time, on or prior to March 15, 2008,
the Issuer may, at their option, use all or any portion of the net cash proceeds
of one or more Equity Offerings to redeem up to 35% of the aggregate principal
amount of the Notes issued at a redemption price equal to 112.75% of the
Accreted Value thereof plus accrued and unpaid interest, if any, to the date of
redemption; provided that at least 65% of the aggregate principal amount of the
Notes originally issued remains outstanding immediately after any such
redemption. In order to effect the foregoing redemption with the proceeds of any
Equity Offering, the Issuer shall consummate such redemption not more than 90
days after the consummation of any such Equity Offering.
6. Sinking Fund
------------
The Notes are not entitled to the benefit of any mandatory sinking
fund.
7. [Reserved]
----------
8. Denominations; Transfer; Exchange
---------------------------------
The Notes are in registered form, without coupons, in denominations
of $1,000 and whole multiples of $1,000 in excess thereof. A Holder shall
register the transfer of or exchange of the Notes in accordance with the
Indenture. Upon any registration of transfer of or exchange, the Registrar and
the Trustee may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes required by law or
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Notes selected for redemption (except, in the case of a Note to be
redeemed in part, the portion of the Note not to be redeemed) or to transfer or
exchange any Notes for a period of 15 days prior to a selection of Notes to be
redeemed.
9. Persons Deemed Owners
---------------------
The registered Holder of this Note shall be treated as the owner of
it for all purposes.
10. Unclaimed Money
---------------
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and a Paying Agent shall pay the money back to the
Issuer at its written request unless an abandoned property law designates
another Person. After any such payment, the Holders entitled to the money must
look to the Issuer for payment as general creditors and the Trustee and a Paying
Agent shall have no further liability with respect to such monies.
B-7
11. Discharge and Defeasance
------------------------
Subject to certain conditions, the Issuer at any time may terminate
some of or all its obligations under the Notes and the Indenture if the Issuer
deposits with the Trustee money or Government Obligations for the payment of
principal and interest on the Notes to redemption, or maturity, as the case may
be.
12. Amendment, Waiver
-----------------
Subject to certain exceptions, the Indenture and the Notes may be
amended, or default may be waived, with the consent of the Holders of a majority
in principal amount at maturity of the outstanding Notes. Without notice to or
the consent of any Holder, the Issuer and the Trustee may amend or supplement
the Indenture or the Notes to, among other things, cure any ambiguity, defect or
inconsistency.
13. Defaults and Remedies
---------------------
If an Event of Default occurs (other than an Event of Default
relating to certain events of bankruptcy, insolvency or reorganization of the
Issuer) and is continuing, the Trustee or the Holders of at least 25% in
principal amount at maturity of the outstanding Notes, in each case, by notice
to the Issuer, may declare the Accreted Value of, premium, if any, and accrued
but unpaid interest on all the Notes to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Issuer occurs, the Accreted Value of, premium, if any, and interest on
all the Notes shall become immediately due and payable without any declaration
or other act on the part of the Trustee or any Holders. Under certain
circumstances, the Holders of a majority in principal amount at maturity of the
outstanding Notes may rescind any such acceleration with respect to the Notes
and its consequences.
14. Trustee Dealings with the Issuer
--------------------------------
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with and collect obligations owed to it
by the Issuer or its Affiliates and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Trustee.
15. No Recourse Against Others
--------------------------
No director, officer, employee, incorporator or holder of any equity
interests in the Issuer or any direct or indirect parent, as such, shall have
any liability for any obligations of the Issuer under the Notes or this
Indenture or for any claim based on, in respect of, or by any reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability.
16. Authentication
--------------
This Note shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Note.
B-8
17. Abbreviations
-------------
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
18. Governing Law
-------------
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
19. CUSIP Numbers, ISINs and Common Codes
-------------------------------------
The Issuer has caused CUSIP numbers and ISINs to be printed on the
Notes and has directed the Trustee to use CUSIP numbers and ISINs in notices of
redemption as a convenience to the Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
THE ISSUER WILL FURNISH TO ANY HOLDER OF NOTES UPON WRITTEN REQUEST
AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH HAS IN IT THE
TEXT OF THIS NOTE.
B-9
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to:
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Note on the books of the Issuer.
The agent may substitute another to act for him.
Date: Your Signature:
-------------- ---------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Signature Guarantee:
Date:
---------------- ---------------------------------
Signature must be guaranteed by a Signature of Signature Guarantee
participant in a recognized signature
guaranty medallion program or other
signature guarantor program reasonably
acceptable to the Trustee
B-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer
pursuant to Section 4.06 (Asset Sale) or Section 4.08 (Change of Control) of the
Indenture, check the box:
Asset Sale [_] Change of Control [_]
If you want to elect to have only part of this Note purchased by the
Issuer pursuant to Section 4.06 (Asset Sale) or Section 4.08 (Change of Control)
of the Indenture, state the amount ($1,000 or an integral multiple of $1,000 in
excess thereof):
$
Date: Your Signature:
------------- ----------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Signature Guarantee:
-------------------------------------------------------------
Signature must be guaranteed by a participant in a recognized
signature guaranty medallion program or other signature
guarantor program reasonably acceptable to the Trustee
B-11
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The initial principal amount at maturity of this Global Note is
$_______________. The following increases or decreases in this Global Note have
been made:
Amount of decrease Amount of increase Principal amount at
in principal amount in principal amount maturity of this Global Signature of authorized
Date of at maturity of this at maturity of this Note following such signatory of Trustee or
Exchange Global Note Global Note decrease or increase Notes Custodian
-------- ----------- ----------- -------------------- ---------------
B-12
EXHIBIT C
Form of
Transferee Letter of Representation
Rural/Metro Corporation
Xxxxx Fargo Bank, N.A.
c/o Xxxxxx X. X'Xxxxxxx
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ] principal
amount at maturity of the 12 3/4% Senior Discount Notes due 2016 (the "Notes")
of Rural/Metro Corporation (the "Issuer").
Upon transfer, the Notes would be registered in the name of the new
beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act)), purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount at
maturity of the Notes, and we are acquiring the Notes not with a view to, or for
offer or sale in connection with, any distribution in violation of the
Securities Act or any applicable security law of any State in the United States
or any other applicable jurisdiction, provided that the disposition of our
property and the property of any accounts for which we are acting as fiduciary
will remain at all times within our or their control. We 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 invest in or purchase
securities similar to the Notes in the normal course of our business. We, and
any accounts for which we are acting, are each able to bear the economic risk of
our or its investment.
C-1
2. We understand that the Notes have not been registered under the
Securities Act and, unless so registered, may not be sold except as permitted in
the following sentence. We agree on our own behalf, the Issuer's behalf and on
behalf of any investor account for which we are purchasing Notes to offer, sell
or otherwise transfer such Notes prior to the date that is two years after the
later of the date of original issue and the last date on which the Issuer or any
affiliate of the Issuer was the owner of such Notes (or any predecessor thereto)
(the "Resale Restriction Termination Date") only (a) to the Issuer, (b) pursuant
to a registration statement that has been declared effective under the
Securities Act, (c) in a transaction complying with the requirements of Rule
144A under the Securities Act ("Rule 144A"), to a person we reasonably believe
is a qualified institutional buyer under Rule 144A (a "QIB") that is purchasing
for its own account or for the account of a QIB and to whom notice is given that
the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and
sales that occur outside the United States within the meaning of Regulation S
under the Securities Act, (e) to an institutional "accredited investor" within
the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
purchasing for its own account or for the account of such an institutional
"accredited investor," in each case in a minimum principal amount at maturity of
Notes of $250,000, or (f) pursuant to any other available exemption from the
registration requirements of the Securities Act, subject in each of the
foregoing cases to any requirement of law that the disposition of our property
or the property of such investor account or accounts be at all times within our
or their control and in compliance with any applicable state securities laws.
The foregoing restrictions on resale will not apply subsequent to the Resale
Restriction Termination Date. If any resale or other transfer of the Notes is
proposed to be made pursuant to clause (c) or (d) above prior to the Resale
Restriction Termination Date, the transferor shall deliver to the Trustee a
written certificate in the form provided in the Note, to the effect that the
transfer is being made in accordance with Regulation S or Rule 144A, as the case
may be. If any resale or other transfer of the Notes is proposed to be made
pursuant to clause (e) above prior to the Resale Restriction Termination Date,
the transferor shall deliver a letter from the transferee substantially in the
form of this letter to the Issuer and the Trustee, which shall provide, among
other things, that the transferee is an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act
and that it is acquiring such Notes for investment purposes and not for
distribution in violation of the Securities Act. If any resale or other transfer
of the Notes is proposed to be made pursuant to clause (e) or (f) above prior to
the Resale Restriction Termination Date, the transferor shall deliver to the
Trustee certificates Each purchaser acknowledges that the Issuer and the Trustee
reserve the right prior to the offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Notes pursuant to clause (d), (e) or (f)
above to require the delivery of an opinion of counsel, certifications or other
information satisfactory to the Issuer and the Trustee in order to determine
that the proposed transfer is being made in compliance with the Securities Act
and applicable law. Not representation is made as to the availability of any
Rule 144A exemption from the registration requirements of the Securities Act.
Dated:
TRANSFEREE:
By:
----------------------------------
