Exhibit 4.1
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ANACOMP, INC.
10 7/8% Series C Senior Subordinated Notes due 2004
10 7/8% Series D Senior Subordinated Notes due 2004
__________________________________
INDENTURE
Dated as of June 18, 1998
__________________________________
IBJ XXXXXXXX BANK & TRUST COMPANY,
Trustee
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TABLE OF CONTENTS
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ARTICLE 1
Definitions and Incorporation by Reference . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.1. Definitions.. . . . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.2. Other Definitions . . . . . . . . . . . . . . . . . . . . 18
SECTION 1.3. Incorporation by Reference of Trust Indenture Act . . . . 19
SECTION 1.4. Rules of Construction . . . . . . . . . . . . . . . . . . 20
ARTICLE 2
The Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.1. Form and Dating. . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.2. Execution and Authentication . . . . . . . . . . . . . . 21
SECTION 2.3. Registrar and Paying Agent . . . . . . . . . . . . . . . 21
SECTION 2.4. Deposit of Moneys; Paying Agent To Hold Money in Trust . 22
SECTION 2.5. Securityholder Lists . . . . . . . . . . . . . . . . . . 22
SECTION 2.6. Transfer and Exchange. . . . . . . . . . . . . . . . . . 22
SECTION 2.7. Book-Entry Provisions for Global Securities. . . . . . . 23
SECTION 2.8. Certificated Securities. . . . . . . . . . . . . . . . . 24
SECTION 2.9. Replacement Securities . . . . . . . . . . . . . . . . . 24
SECTION 2.10. Outstanding Securities . . . . . . . . . . . . . . . . . 24
SECTION 2.11. Temporary Securities . . . . . . . . . . . . . . . . . . 25
SECTION 2.12. Cancellation . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.13. Defaulted Interest . . . . . . . . . . . . . . . . . . . 25
SECTION 2.14. Restrictive Legends. . . . . . . . . . . . . . . . . . . 26
SECTION 2.15. Special Transfer Provisions. . . . . . . . . . . . . . . 27
SECTION 2.16. Record Date. . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 2.17. CUSIP Numbers. . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 3
Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.1. Notices to Trustee . . . . . . . . . . . . . . . . . . . 29
SECTION 3.2. Selection of Securities To Be Redeemed . . . . . . . . . 29
SECTION 3.3. Notice of Redemption . . . . . . . . . . . . . . . . . . 30
SECTION 3.4. Effect of Notice of Redemption . . . . . . . . . . . . . 30
SECTION 3.5. Deposit of Redemption Price. . . . . . . . . . . . . . . 31
SECTION 3.6. Securities Redeemed in Part. . . . . . . . . . . . . . . 31
ARTICLE 4
(i)
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Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.1. Payment of Securities . . . . . . . . . . . . . . . . . . 31
SECTION 4.2. SEC Reports . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.3. Limitation on Indebtedness. . . . . . . . . . . . . . . . 32
SECTION 4.4. Limitation on Restricted Subsidiary Indebtedness
and Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.5. Limitation on Restricted Payments . . . . . . . . . . . . 36
SECTION 4.6. Limitation on Restrictions on Distributions from
Restricted Subsidiaries . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 4.7. Limitation on Sales of Assets and Restricted
Subsidiary Stock. . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 4.8. Limitation on Transactions with Affiliates. . . . . . . . 44
SECTION 4.9. Change of Control . . . . . . . . . . . . . . . . . . . . 44
SECTION 4.10. Compliance Certificate . . . . . . . . . . . . . . . . . 47
SECTION 4.11. Further Instruments and Acts . . . . . . . . . . . . . . 47
SECTION 4.12. Limitation on Liens. . . . . . . . . . . . . . . . . . . 47
SECTION 4.13. Limitation on Sale/Leaseback Transactions. . . . . . . . 48
SECTION 4.14. Limitation on Issuance and Sale of Capital Stock
of Restricted Subsidiaries. . . . . . . . . . . . . . . . . . . . . 48
SECTION 4.15. Restricted and Unrestricted Subsidiaries . . . . . . . . 48
SECTION 4.16. Revisions to Schedules . . . . . . . . . . . . . . . . . 49
SECTION 4.17. Maintenance of Properties; Insurance . . . . . . . . . . 49
SECTION 4.18. Corporate Existence. . . . . . . . . . . . . . . . . . . 49
SECTION 4.19. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 4.20. Conflicting Agreements . . . . . . . . . . . . . . . . . 50
SECTION 4.21. Limitation on Layering . . . . . . . . . . . . . . . . . 50
ARTICLE 5
Xxxxxx, Consolidation or Sale of Assets. . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE 6
Defaults and Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.1. Events of Default . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.2. Acceleration. . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 6.3. Other Remedies. . . . . . . . . . . . . . . . . . . . . . 53
SECTION 6.4. Waiver of Past Defaults . . . . . . . . . . . . . . . . . 54
SECTION 6.5. Control by Majority . . . . . . . . . . . . . . . . . . . 54
SECTION 6.6. Limitation on Suits . . . . . . . . . . . . . . . . . . . 54
SECTION 6.7. Rights of Holders To Receive Payment. . . . . . . . . . . 55
SECTION 6.8. Collection Suit by Trustee. . . . . . . . . . . . . . . . 55
SECTION 6.9. Trustee May File Proofs of Claim. . . . . . . . . . . . . 55
SECTION 6.10. Priorities . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 6.11. Undertaking for Costs. . . . . . . . . . . . . . . . . . 55
SECTION 6.12. Waiver of Stay or Extension Laws . . . . . . . . . . . . 56
ARTICLE 7
(ii)
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Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 7.1. Duties of Trustee . . . . . . . . . . . . . . . . . . . . 56
SECTION 7.2. Rights of Trustee . . . . . . . . . . . . . . . . . . . . 57
SECTION 7.3. Individual Rights of Trustee. . . . . . . . . . . . . . . 58
SECTION 7.4. Trustee's Disclaimer. . . . . . . . . . . . . . . . . . . 58
SECTION 7.5. Notice of Defaults. . . . . . . . . . . . . . . . . . . . 58
SECTION 7.6. Reports by Trustee to Holders . . . . . . . . . . . . . . 58
SECTION 7.7. Compensation and Indemnity. . . . . . . . . . . . . . . . 58
SECTION 7.8. Replacement of Trustee. . . . . . . . . . . . . . . . . . 59
SECTION 7.9. Successor Trustee by Xxxxxx . . . . . . . . . . . . . . . 60
SECTION 7.10. Eligibility; Disqualification. . . . . . . . . . . . . . 60
SECTION 7.11. Preferential Collection of Claims Against Company. . . . 60
ARTICLE 8
Discharge of Indenture; Defeasance . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 8.1. Discharge of Liability on Securities; Defeasance. . . . . 61
SECTION 8.2. Conditions to Defeasance. . . . . . . . . . . . . . . . . . 61
SECTION 8.3. Application of Trust Money . . . . . . . . . . . . . . . . 62
SECTION 8.4. Repayment to Company . . . . . . . . . . . . . . . . . . . 63
SECTION 8.5. Indemnity for Government Obligations . . . . . . . . . . . 63
SECTION 8.6. Reinstatement. . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE 9
Subordination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 9.1. Securities Subordinated to Senior Indebtedness . . . . . . 63
SECTION 9.2. No Payment on Securities in Certain Circumstances. . . . . 64
SECTION 9.3. Securities Subordinated to Prior Payment of All
Senior Indebtedness on Dissolution, Liquidation or
Reorganization of Company . . . . . . . . . . . . . . . . . . . . . 65
SECTION 9.4. Securityholders To Be Subrogated to Rights of
Holders of Senior Indebtedness. . . . . . . . . . . . . . . . . . . 66
SECTION 9.5. Obligations of the Company Unconditional. . . . . . . . . 66
SECTION 9.6. Trustee and Paying Agent Entitled To Assume
Payments Not Prohibited in Absence of Notice. . . . . . . . . . . . 67
SECTION 9.7. Application by Trustee of Monies Deposited With It. . . . 67
SECTION 9.8. Subordination Rights Not Impaired by Acts or
Omissions of Company or Holders of Senior Indebtedness. . . . . . . 67
SECTION 9.9. Securityholders Authorize Trustee To Effectuate
Subordination of Securities . . . . . . . . . . . . . . . . . . . . 68
SECTION 9.10. Right of Trustee and Paying Agent To Hold Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 9.11. Article 9 Not To Prevent Events of Default . . . . . . . 68
SECTION 9.12. No Fiduciary Duty Created to Holders of Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
ARTICLE 10
(iii)
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Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 10.1. Without Consent of Holders . . . . . . . . . . . . . . . 69
SECTION 10.2. With Consent of Holders. . . . . . . . . . . . . . . . . 69
SECTION 10.3. Compliance with Trust Indenture Act. . . . . . . . . . . 70
SECTION 10.4. Revocation and Effect of Consents and Waivers. . . . . . 70
SECTION 10.5. Notation on or Exchange of Securities. . . . . . . . . . 71
SECTION 10.6. Trustee To Sign Amendments . . . . . . . . . . . . . . . 71
SECTION 10.7. Payment for Consent. . . . . . . . . . . . . . . . . . . 71
ARTICLE 11
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 11.1. Trust Indenture Act Controls . . . . . . . . . . . . . . 71
SECTION 11.2. Notices. . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 11.3. Communication by Holders with Other Holders. . . . . . . 72
SECTION 11.4. Certificate and Opinion as to Conditions Precedent . . . 72
SECTION 11.5. Statements Required in Certificate or Opinion. . . . . . 72
SECTION 11.6. Rules by Trustee, Paying Agent and Registrar . . . . . . 73
SECTION 11.7. Legal Holidays . . . . . . . . . . . . . . . . . . . . . 73
SECTION 11.8. Governing Law. . . . . . . . . . . . . . . . . . . . . . 73
SECTION 11.9. No Recourse Against Others . . . . . . . . . . . . . . . 73
SECTION 11.10. Successors. . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 11.11. Multiple Originals. . . . . . . . . . . . . . . . . . . 73
SECTION 11.12. Qualification of Indenture . . . . . . . . . . . . . . . 73
SECTION 11.13. Table of Contents; Headings . . . . . . . . . . . . . . 74
SECTION 11.14. Severability. . . . . . . . . . . . . . . . . . . . . . 74
(iv)
ANACOMP, INC.
Reconciliation and tie between Trust Indenture Act of 1939 ("TIA") and
Indenture dated as of June 18, 1998.*
TIA Indenture
Section Section
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310(a)(1)........................... 7.10
(a)(2).............................. 7.10
(a)(3).............................. N.A.
(a)(4).............................. N.A.
(a)(5).............................. 7.10
(b)................................. 7.8, 7.10
(c)................................. N.A.
311(a).............................. 7.11
(b)................................. 7.11
(c)................................. N.A.
312(a).............................. 2.5
(b)................................. 11.3
(c)................................. 11.3
313(a).............................. 7.6
(b)(1).............................. N.A.
(b)(2).............................. 7.6
(c) ................................ 11.2
(d)................................. 7.6
314(a).............................. 4.2, 4.10
.................................... 11.2
(b)................................. 4.21
(c)(1).............................. 11.4
(c)(2).............................. 11.4
(c)(3).............................. N.A.
(d)................................. N.A.
(e)................................. 11.5
(f)................................. 4.10
315(a).............................. 7.1
(b)................................. 7.5; 11.2
(c)................................. 7.1
(d)................................. 7.1
(e)................................. 6.11
316(a)(last sentence) .............. 2.8
(a)(1)(A)........................... 6.5
(a)(1)(B)........................... 6.4
(a)(2).............................. N.A.
(b)................................. 6.7
(i)
(c)................................. 6.7
317(a)(1)........................... 6.8
(a)(2).............................. 6.9
(b)................................. 2.4
318(a)..............................11.1
N.A. means Not Applicable
____________________________
* This reconciliation and tie shall not, for any purpose, be deemed
to be part of the Indenture. This reconciliation and tie shall only apply
subsequent to qualification of this Indenture under the TIA.
(ii)
INDENTURE dated as of June 18, 1998, between ANACOMP, INC., an Indiana
corporation (the "Company"), and IBJ XXXXXXXX BANK & TRUST COMPANY, a New York
banking corporation (the "Trustee").
The Company has duly authorized the creation and issuance of up to
$135,000,000 aggregate principal amount of 10 7/8% Series C Senior Subordinated
Notes due 2004 (the "Initial Securities") and $135,000,000 aggregate principal
amount of 10 7/8% Series D Senior Subordinated Notes due 2004 (the "Exchange
Securities") and, to provide therefor, the Company has duly authorized the
execution and delivery of this Indenture. All things necessary to make the
Securities (as defined herein), when duly issued and executed by the Company,
and authenticated and delivered hereunder, the valid obligations of the Company,
and to make this Indenture a valid and binding agreement of the Company have
been done.
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Securities:
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.1. Definitions.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
Notwithstanding the foregoing, each Unrestricted Subsidiary shall be deemed an
Affiliate of the Company and of each other Subsidiary of the Company.
"Asset Disposition" means any direct or indirect sale, lease,
transfer, conveyance or other disposition (or series of related sales, leases,
transfers, conveyances or dispositions) of shares of Capital Stock of any
Restricted Subsidiary (other than directors' qualifying shares), property or
other assets (each referred to for the purposes of this definition as a
"disposition") by the Company or any Restricted Subsidiary (including any
disposition by means of a merger, consolidation or similar transaction), other
than (i) a disposition by a Restricted Subsidiary to the Company or by the
Company or a Restricted Subsidiary to a Wholly Owned Subsidiary, (ii) a
disposition of the Company's or any Restricted Subsidiary's accounts receivable,
lease receivables or inventory (other than the disposition of inventory pursuant
to a Sale/Leaseback Transaction) at Fair Market Value in the Ordinary Course of
Business, (iii) a disposition of property or assets, whether in a single
transaction or a series of related transactions which constitute a single plan
of disposition, that have an aggregate Fair Market Value not in excess of
$250,000, (iv) an operating lease entered into in the ordinary course of
business with respect to property, plant or equipment that in the judgment of
the Board of Directors constitutes excess capacity or (v) a "like-kind
exchange" of an asset in exchange for an asset of a third party, so long as, in
the judgment of the Company's Board of Directors, the asset received by the
Company or such Restricted Subsidiary in such exchange (x) has a Fair Market
Value at least equal to the fair market value of the asset transferred by the
Company or such Restricted Subsidiary and (y) is usable in a Permitted Line of
Business to at least the same extent as the asset transferred by the Company or
such Restricted Subsidiary. An Asset Disposition shall include the requisition
of title to, seizure of or forfeiture of any property or assets, or any actual
or constructive total loss or an agreed or compromised total loss of any
property or assets. The term "Asset Disposition" when used with respect to the
Company shall not include any disposition pursuant to Article 5 which
constitutes a disposition of all or substantially all the assets of the Company.
"Attributable Indebtedness," in respect of a Sale/Leaseback
Transaction, means, as at the time of determination, the greater of (i) the Fair
Market Value of the property subject to such Sale/Leaseback Transaction (as
determined in good faith by the Board of Directors) or (ii) the present value
(discounted at the interest rate borne by the Securities, compounded annually)
of the total obligations of the lessee for rental payments during the remaining
term of the lease included in such Sale/Leaseback Transaction (including any
period for which such lease has been extended).
"Authorized Denominations" shall mean denominations of $1,000, or
integral multiples thereof, except in the case of Accrued Interest Securities,
in which case Authorized Denominations shall mean any denomination.
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the products of (a) the number of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred Stock and (b) the
amount of such payment by (ii) the sum of all such payments.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board.
"Board Resolution" means a duly adopted resolution of the Board of
Directors in full force and effect at the time of determination and certified as
such by the Secretary or an Assistant Secretary of the Company.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligations" means an obligation that is required to be
classified and accounted for as a capital lease for financial reporting purposes
in accordance with GAAP; the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
2
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests (including partnership interests) in (however designated) equity of
such Person, including any Preferred Stock, but excluding any debt securities
convertible into such equity.
"Change of Control" means the occurrence of any of the following
events: (i) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than an underwriter engaged in a firm commitment
underwriting in connection with a public offering of the Voting Stock of the
Company or a Restricted Subsidiary, is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person
shall be deemed to have "beneficial ownership" of all shares that any such
person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of more than 50% of
the total voting power of the Voting Stock of the Company; (ii) during any
period of two consecutive years, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together with any new
directors whose election by such Board or whose nomination for election by the
shareholders of the Company was approved by a vote of a majority of the
directors of the Company 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 such
Board then in office; or (iii) the Company, either individually or in
conjunction with one or more of its Subsidiaries, sells, conveys, leases or
otherwise transfers, or one or more of such Subsidiaries sell, convey, lease or
otherwise transfer, all or substantially all the assets of the Company and the
Restricted Subsidiaries, taken as a whole, to any Person (other than a
Restricted Subsidiary).
"Code" means the Internal Revenue Code of 1986, as amended.
"Commodity Price Protection Agreement" means, in respect of a Person,
any forward contract, commodity swap agreement, commodity option agreement or
other similar agreement or arrangement designed to protect such Person against
fluctuations in commodity prices.
"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the indenture securities.
"Consolidated Coverage Ratio" means, as of any date of determination,
the ratio of (i) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters ending at least 45 days prior to the
date of such determination to (ii) Consolidated interest Expense for such four
fiscal quarters; provided, however, that (1) if the Company or any Restricted
Subsidiary has Incurred any Indebtedness since the beginning of such period that
remains outstanding or if the transaction giving rise to the need to calculate
the Consolidated Coverage Ratio is an Incurrence of Indebtedness, or both,
EBITDA and Consolidated Interest Expense for such period shall be calculated
after giving effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such
3
period and the discharge of any other Indebtedness repaid, repurchased, defeased
or otherwise discharged with the proceeds of such new Indebtedness as if such
discharge had occurred on the first day of such period, (2) if since the
beginning of such period the Company or any Restricted Subsidiary shall have
made any Asset Disposition or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an Asset Disposition, or both,
EBITDA for such period shall be reduced by an amount equal to EBITDA (if
positive) directly attributable to the property or assets which are the subject
of such Asset Disposition for such period, or increased by an amount equal to
EBITDA (if negative) directly attributable thereto for such period and
Consolidated Interest Expense for such period shall be reduced by an amount
equal to the Consolidated Interest Expense directly attributable to any
Indebtedness of the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company and the continuing
Restricted Subsidiaries in connection with such Asset Dispositions for such
period (or, if the Capital Stock of any Restricted Subsidiary is sold,
Consolidated Interest Expense for such period directly attributable to the
Indebtedness of such Restricted Subsidiary to the extent the Company and the
continuing Restricted Subsidiaries are no longer liable for such Indebtedness
after such sale), (3) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an Investment in
any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary)
or an acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder, which
constitutes all or substantially all of an operating unit of a business, EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any Indebtedness)
as if such Investment or acquisition occurred on the first day of such period
and (4) if since the beginning of such period any Person (that subsequently
became a Restricted Subsidiary or was merged with or into the Company or any
Restricted Subsidiary since the beginning of such period) shall have made any
Asset Disposition or any Investment that would have required an adjustment
pursuant to clause (2) or (3) above if made by the Company or a Restricted
Subsidiary during such period, EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto as if such
Asset Disposition or Investment occurred on the first day of such period. For
purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any Indebtedness
Incurred in connection therewith, the pro forma calculations shall be determined
in good faith by a responsible financial or accounting Officer of the Company
and as further contemplated by the definition of pro forma. If any Indebtedness
bears a floating rate of interest and is being given pro forma effect, the
interest expense on such Indebtedness shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Protection Agreement applicable to
such Indebtedness if such Interest Rate Protection Agreement has a remaining
term in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the sum of (i)
the total cash and noncash interest expense of the Company and its consolidated
Subsidiaries, plus, to the extent not included in such interest expense, (A)
interest expense attributable to Capital Lease Obligations, (B) amortization of
debt discount and debt issuance cost, (C) capitalized interest, (D) accrued
interest, (E) commissions, discounts and other fees and charges paid or owed
with respect to letters of credit and bankers' acceptance financing, (F)
interest actually paid by the Company or any such Subsidiary under any Guarantee
of Indebtedness or other obligation of any
4
other Person, (G) net costs associated with Hedging Obligations (including
amortization of discounts and fees), (H) the interest portion of any deferred
obligation, (I) Preferred Stock dividends in respect of all Preferred Stock of
Subsidiaries of the Company and Redeemable Stock of the Company held by Persons
other than the Company or a Wholly owned Subsidiary and (J) cash contributions
to any employee stock ownership plan or similar trust to the extent such
contributions are used by such plan or trust to pay interest or fees to any
Person (other than the Company) in connection with Indebtedness incurred by such
plan or trust (provided, however, that there shall be excluded from this clause
(i), (x) any such interest expense of any Unrestricted Subsidiary to the extent
the related Indebtedness is not Guaranteed or paid by the Company or any
Restricted Subsidiary and (y) any such interest expense attributable to original
issue discount as a result of Fresh Start Accounting adjustments), less (ii) to
the extent included in clause (i), amortization or write-off of deferred
financing costs of the Company and its consolidated Subsidiaries during such
period and any charge related to any premium or penalty paid in connection with
redeeming or retiring any Indebtedness of the Company and its consolidated
Subsidiaries prior to its Stated Maturity.
"Consolidated Net Income" means, for any period, the net income (loss)
of the Company and its consolidated Subsidiaries for such period determined in
accordance with GAAP but excluding for such purpose the impact of any Fresh
Start Accounting adjustment; provided, however, that there shall not be included
in such Consolidated Net Income (i) any net income (loss) of any Person if such
Person is not a Restricted Subsidiary, except that (A) subject to the
limitations contained in (iv) below, the Company's equity in the net income of
any such Person for such period shall be included in such Consolidated Net
Income up to the aggregate amount of cash actually distributed by such Person
during such period to the Company or a Restricted Subsidiary as a dividend or
other distribution (subject, in the case of a dividend or other distribution to
a Restricted Subsidiary, to the limitations contained in clause (iii) below) and
(B) the Company's equity in a net loss of any such Person (other than an
Unrestricted Subsidiary) for such period shall be included in determining such
Consolidated Net Income, (ii) any net income (loss) of any person acquired by
the Company or a Restricted Subsidiary in a pooling of interests transaction for
any period prior to the date of such acquisition, (iii) any net income (loss) of
any Restricted Subsidiary if such Restricted Subsidiary is subject to
restrictions, directly or indirectly, on the payment of dividends or the making
of distributions by such Restricted Subsidiary, directly or indirectly, to the
Company, except that (A) subject to the limitations contained in (iv) below, the
Company's equity in the net income of any such Restricted Subsidiary for such
period shall be included in such Consolidated Net Income up to the aggregate
amount of cash that could have been distributed by such Restricted Subsidiary
during such period to the Company or another Restricted Subsidiary as a dividend
(subject, in the case of a dividend to another Restricted Subsidiary, to the
limitation contained in this clause) and (B) the Company's equity in a net loss
of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income, (iv) any gain (but not loss) realized
upon the sale or other disposition of any property, plant or equipment of the
Company or its consolidated Subsidiaries (including pursuant to any
Sale/Leaseback Transaction) which is not sold or otherwise disposed of in the
ordinary course of business, (v) any gain (but not loss) realized upon the sale
or other disposition of any Capital Stock of any Person, (vi) any extraordinary
gain or loss, (vii) the cumulative effect of a
5
change in accounting principles and (viii) any non-recurring restructuring
charges for any fiscal quarter in the fiscal year of the Company commencing
October 1, 1995.
"Consolidated Tangible Net Worth" means the amount by which (i) the
total of the amounts shown on the balance sheet of the Company and its
consolidated Subsidiaries, determined on a consolidated basis in accordance with
GAAP, as of the end of the most recent fiscal quarter of the Company ending at
least 45 days prior to the taking of any action for the purpose of which the
determination is being made, as (x) the par or stated value of all outstanding
Capital Stock of the Company plus (y) paid-in capital or capital surplus
relating to such Capital Stock plus (z) any retained earnings or earned surplus
exceeds (ii) the sum of (A) any accumulated deficit, (B) any amounts
attributable to Disqualified Stock, (C) the amounts appearing on the assets side
of such balance sheet for all contracts, patents, trademarks, copyrights and
other intellectual property rights, franchises, licenses, goodwill, treasury
stock, unamortized debt discount and expense and similar intangibles, (D) any
increase in the amount of capitalized research and development and capitalized
interest subsequent to the Issue Date, and (E) the amount of any write-up
subsequent to the Issue Date in the book value of any asset owned on the Issue
Date resulting from the revaluation thereof subsequent to such date, or any
write-up in excess of the cost of any asset acquired subsequent to that date.
"Credit Facility" means the revolving credit agreement, dated as of
June 15, 1998 among the Company and the various financial institutions named
therein, as the same may be amended, restated, supplemented or otherwise
modified from time to time, and includes any agreement renewing, refinancing or
replacing all or any portion of the Indebtedness thereunder.
"Currency Exchange Protection Agreement" means, in respect of any
Person, any foreign exchange contract, currency swap agreement, currency option
or other similar agreement or arrangement designed to protect such Person
against fluctuations in foreign currency exchange rates.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" shall mean The Depository Trust Company, its nominees,
and their respective successors.
"Dispositions" means the sale of (a) the document print and
distribution services business of First Image and (b) the document acquisition
services business of First Image.
"Disqualified Stock" of a Person means Redeemable Stock of such Person
as to which the maturity, mandatory redemption, conversion or exchange or
redemption at the option of the Holder thereof occurs, or may occur, on or prior
to the first anniversary of the Stated Maturity of the Securities.
"Dollar Equivalent" means, with respect to any monetary amount in a
currency other than U.S. dollars, at any time for the determination thereof, the
amount of U.S. dollars obtained by converting such foreign currency involved in
such computation into U.S. dollars at
6
the spot rate for the purchase of U.S. dollars with the applicable foreign
currency as quoted by Xxxxxxxx, N.A. in New York City at approximately 11:00
a.m. (New York time) on the date two Business Days prior to such determination.
"EBITDA" for any period means the Consolidated Net income for such
period, plus, to the extent deducted in calculating such Consolidated Net
Income, (i) income tax expense, (ii) Consolidated Interest Expense, (iii)
depreciation expense, (iv) amortization expense and (v) any charge related to
any premium or penalty paid in connection with redeeming or retiring any
Indebtedness prior to its Stated Maturity, in each case for such period.
"Exchange Act" means the Securities Exchange Act of 1934.
"Exchange Securities" has the meaning set forth in the preamble to
this Indenture.
"Existing Credit Facility" means the Credit and Guarantee Agreement
dated as of February 28, 1997 among the Company and the other Parties thereto,
as the same may be amended, restated, supplemented or otherwise modified from
time to time, and includes any agreement renewing, refinancing or replacing all
or any portion of the Indebtedness thereunder.
"Existing Indenture" means the Indenture, dated as of March 24, 1997,
between the Company and IBJ Xxxxxxxx Bank & Trust, as trustee, as the same may
be amended, restated, supplemented or otherwise modified from time to time, and
includes any agreement renewing, refinancing or replacing all or any portion of
the Indebtedness under such agreement.
"Existing Notes" means the 10 7/8% Senior Subordinated Notes due 2004,
Series B issued by the Company pursuant to the Existing Indenture.
"Existing Notes Issue Date" means the date on which the Existing Notes
were issued which date was March 24, 1997.
"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 buyer, neither of whom is under
undue pressure or compulsion to complete the transaction; provided, that the
foregoing shall not prohibit sales of inventory at a discount or on terms which
are typical in the industry to which such inventory relates. Fair Market Value
shall be determined, except as otherwise provided herein, (i) if such property
or asset has a Fair Market Value less than $5,000,000, by two officers of the
Company in an Officers' Certificate delivered to the Trustee or (ii) if such
property or asset has a Fair Market Value in excess of $5,000,000, by the Board
of Directors as a whole and evidenced by a Board Resolution, dated within 30
days of the relevant transaction, of the Board of Directors delivered to the
Trustee.
"First Image" means First Image Management Company, a division of
First Financial Management Corporation.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary that
is incorporated in a jurisdiction other than the United States of America, any
State thereof or the District of Columbia.
7
"Fresh Start Accounting" means Fresh Start Accounting as described in
Statement of Position 90-7, "Financial Reporting by Entities in Reorganization
Under the Bankruptcy Code" (Am. Inst. of Certified Public Accountants 1990), as
then in effect, or any comparable statement then in effect.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in
this Indenture shall be computed in conformity with GAAP consistently applied,
except as otherwise expressly provided in this Indenture.
"Guarantee" means any obligation, contingent or otherwise, of any
Person, directly or indirectly, guaranteeing any Indebtedness or other
obligation of any other Person and any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness or other
obligation of such other Person (whether arising by virtue of partnership
arrangements, or by agreement to purchase assets, goods, securities or services,
to take-or-pay or to maintain financial statement conditions or otherwise) or
(ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness or other obligation of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part); provided,
however, that the term "Guarantee" shall not include endorsements for collection
or deposit in the ordinary course of business. The term "Guarantee" used as a
verb has a corresponding meaning.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Protection Agreement, Commodity Price
Protection Agreement or Currency Exchange Protection Agreement or other similar
agreement or arrangement.
"Holder" or "Securityholder" means the Person in whose name a Security
is registered on the Registrar's books.
"Incur" means to, directly or indirectly, create, issue, assume,
Guarantee, incur (by conversion, exchange or otherwise), extend, assume, or
otherwise become liable for, contingently or otherwise; provided, however, that
any Indebtedness or Capital Stock of a Person existing at the time such Person
becomes a Subsidiary (whether by merger, consolidation, acquisition or
otherwise) will be deemed to be incurred by such Subsidiary at the time it
becomes a Subsidiary. The terms "Incurrence," "Incurred" and "Incurring" shall
each have a correlative meaning.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication): (i) the principal of and premium (if any)
in respect of indebtedness of such Person for borrowed money; (ii) the principal
of and premium (if any) in respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments; (iii) all Capital Lease
Obligations and all Attributable Indebtedness of such Person; (iv) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services (except (A) Trade
8
Payables and (B) any obligation to pay any portion of such purchase price that
becomes due only if the earnings attributable to such property or services
satisfy predetermined minimum amounts subsequent to the purchase of such
property or services and the amount of such obligation cannot be determined on
the date of such purchase); (v) all obligations of such Person in respect of
letters of credit, banker's acceptances or other similar instruments or credit
transactions (including reimbursement obligations with respect thereto), other
than obligations with respect to letters of credit securing obligations (other
than obligations described in (i) through (iv) above) entered into in the
ordinary course of business of such Person to the extent such letters of credit
are not drawn upon or, if and to the extent drawn upon, such drawing is
reimbursed no later than the third Business Day following receipt by such Person
of a demand for reimbursement following payment on any such letter of credit;
(vi) the amount of all obligations of such Person with respect to the
redemption, repayment or other repurchase of any Disqualified Stock or, with
respect to any Subsidiary of such Person, any Preferred Stock (but excluding, in
each case, any accrued dividends); (vii) all Indebtedness of other Persons
secured by a Lien on any asset of such Person, whether or not such Indebtedness
is assumed by such Person; provided, however, that the amount of such
Indebtedness shall be the lesser of (A) the Fair Market value of such asset at
such date of determination and (B) the amount of such Indebtedness of such other
Persons; (viii) all Indebtedness of other Persons to the extent Guaranteed by
such Person; and (ix) to the extent not otherwise included in this definition,
obligations of such Person in respect of Hedging Obligations.
For purposes of this definition, the maximum fixed redemption,
repayment or repurchase price of any Disqualified Stock or Preferred Stock that
does not have a fixed redemption, repayment or repurchase price shall be
calculated in accordance with the terms of such Stock as if such Stock were
redeemed, repaid or repurchased on any date on which Indebtedness shall be
required to be determined pursuant to the Indenture; provided, however, that if
such Stock is not then permitted to be redeemed, repaid or repurchased, the
redemption, repayment or repurchase price shall be the book value of such Stock
as reflected in the most recent financial statements of such Person. The amount
of Indebtedness of any Person at any date shall be the outstanding balance at
such date of all unconditional obligations as described above and the maximum
liability. upon the occurrence of the contingency giving rise to the obligation,
of any contingent obligations at such date.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the TIA that are deemed to be a part of and govern
this instrument, and any such supplemental indenture, respectively.
"Indenture Obligations" means the obligations of the Company (and any
other obligor hereunder or under the Securities) to pay principal of, and
premium, if any, and interest (including, without limitation, any default
interest) on, the Securities when due and payable, whether at maturity, by
acceleration, call for redemption or repurchase, in each case as required
hereunder, and all other amounts due or to become due under or in connection
with this Indenture and the Securities and the performance of all other
obligations to the Trustee and the Holders under this Indenture and the
Securities, according to the terms hereof and thereof.
9
"Initial Face Amount" means $135,000,000, the face amount of the
Initial Securities which, when multiplied by the premium at which the Initial
Securities were issued, yielded gross proceeds, to the Company of $140,400,000.
"Initial Securities" has the meaning set forth in the preamble to the
Indenture.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Rate Protection Agreement" means, in respect of any Person,
any interest rate swap agreement, interest rate option agreement, interest rate
cap agreement, interest rate collar agreement, interest rate floor agreement or
other similar agreement or arrangement designed to protect such Person against
fluctuations in interest rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of such Person) or other
extension of credit (including by way of Guarantee or similar arrangement) 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)
such Person, or any purchase or acquisition of all or substantially all the
business or assets of, Capital Stock, Indebtedness, any other evidence of
beneficial ownership or other similar instruments issued by, such Person. For
purposes of Sections 4.5 and 4.15, (i) the term "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted
Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to
(x) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (y) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the Fair Market Value of the net assets of such
Subsidiary at the time that such Subsidiary is so re-designated as a Restricted
Subsidiary; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its Fair Market Value at the time of such
transfer. In determining the amount of any Investment in respect of any property
or asset other than cash, such property or asset shall be valued at its Fair
Market Value at the time of such Investment (unless otherwise specified in this
definition).
"Issue Date" means the first date on which the Initial Securities are
issued pursuant to this Indenture.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, preference, priority, security interest,
encumbrance, easement, restriction, covenant, right-of-way, servitude, lien
(statutory or otherwise), charge, other security or similar agreement or
preferential arrangement of any kind or nature whatsoever or other adverse claim
of any kind or nature (including, without limitation, any conditional sale or
other title retention agreement or lease having substantially the same economic
effect of any of the foregoing).
10
"Magnetics Division" means the property and assets of the Company or
any Restricted Subsidiary used in connection with the manufacture, marketing and
sale of magnetic tape, computer tape or other magnetic products.
"Net Cash Proceeds" from an Asset Disposition means the sum of (i)
cash payments and Temporary Cash Investments received (including any cash
payments received by way of deferred payment of principal pursuant to a note or
installment receivable or otherwise, but only as and when received, but
excluding any other consideration received in the form of assumption by the
acquiring person of Indebtedness or other obligations relating to such
properties or assets or received in any other non-cash form) therefrom and (ii)
the Fair Market Value of all securities issued to the Company or a Subsidiary of
the Company in connection therewith, in each case net of (A) all legal, title
and recording tax expenses, commissions and other fees and expenses incurred,
and all Federal, state, provincial, foreign and local taxes required to be paid
or accrued as a liability under GAAP as a consequence of such Asset Disposition,
(B) all payments made on any Indebtedness which is secured by any property or
assets subject to such Asset Disposition, in accordance with the terms of any
Lien upon such property or assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by applicable law, be
repaid out of the proceeds from such Asset Disposition, (C) all distributions
and other payments required to be made to minority interest Holders in
Subsidiaries or joint ventures as a result of such Asset Disposition and (D) the
deduction of appropriate amounts to be provided by the seller as a reserve, in
accordance with GAAP, against any liabilities associated with the property or
assets disposed of in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition; provided, that, in the event
that any consideration for such Asset Disposition (which would otherwise
constitute Net Cash Proceeds) is required to be held in escrow pending
determination of whether a purchase price adjustment shall be made, such
consideration (or any portion thereof) shall become Net Cash Proceeds only at
such time as it is released to the Company or any Restricted Subsidiary from
escrow; provided, further, that any non-cash consideration received in
connection with such Asset Disposition, which is subsequently converted to cash,
shall be deemed to be Net Cash Proceeds at such time and shall thereafter be
applied in accordance with Section 4.7. The term "Net Cash Proceeds" from an
issuance or sale of Capital Stock means the cash proceeds of such issuance or
sale, net of attorneys' fees, accountants' fees, underwriters' or placement
agents' fees, discounts or commissions and brokerage, consultant and other fees
actually incurred in connection with such issuance or sale and net of taxes paid
or payable as a result thereof.
"Non-U.S. Person" means a Person who is not a U.S. person, as defined
in Regulation S of the Securities Act.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Administrative
Officer, any Vice President, the Treasurer, any Assistant Treasurer, the
Secretary or any Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
11
"Opinion of Counsel" means a written opinion, in form acceptable to
the Trustee, from legal counsel who is acceptable to the Trustee. The counsel
may be an employee of or counsel to the Company or the Trustee.
"Ordinary Course of Business" means sales or assignments of inventory
or accounts receivable or the performance of services at Fair Market Value or
the collection of accounts receivable in the ordinary course of business and
does not include any sale, assignment or collection after the voluntary or
involuntary bankruptcy of the Company, including, without limitation, those
events of the type described in Section 6.1(8) and (9). The ordinary course of
business shall include (i) sales of inventory to customers, (ii) returns of
merchandise to manufacturers or distributors for refunds or credit and (iii)
exchanges of inventory with manufacturers or distributors for other inventory.
"pari passu," as applied to the ranking of any Indebtedness of a
Person in relation to other Indebtedness of such Person, means that each such
Indebtedness either (i) is not subordinate in right of payment to any
Indebtedness or (ii) is subordinate in right of payment to the same Indebtedness
as is the other; and is so subordinate to the same extent, and is not
subordinate in right of payment to each other or to any Indebtedness as to which
the other is not so subordinate.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) a Wholly Owned Subsidiary (including any Person
which will become a Wholly Owned Subsidiary as a result of such Investment) or
any Person that is merged or consolidated with or into, or transfers or conveys
all or substantially all of its business or assets to, the Company or any Wholly
Owned Subsidiary at the time such Investment is made; (ii) Temporary Cash
Investments; (iii) receivables owing to the Company or such Restricted
Subsidiary, if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms; provided,
however, that nothing in this paragraph shall limit in any way the ability of
the Company or such Restricted Subsidiary to settle, compromise or otherwise
deal with such receivables in the ordinary course of business; (iv) payroll,
travel and similar advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for accounting purposes and
that are made in the ordinary course of business; (v) loans or advances, in the
aggregate principal amount of $6,000,000 outstanding from time to time, to
employees of the Company or such Restricted Subsidiary made in the ordinary
course of business consistent with past practices of the Company or such
Restricted Subsidiary, as the case may be; (vi) stock, obligations or securities
received in settlement of debts created in the ordinary course of business and
owing to the Company or such Restricted Subsidiary or in satisfaction of
judgments; (vii) joint ventures, whether in the form of cash or through a
contribution of assets (the nature of which, if other than cash, to be
determined in good faith by the Board of Directors, whose determination shall be
evidenced by a Board Resolution delivered to the Trustee) in an amount not to
exceed $10,000,000 at any one time; (viii) any other property, asset or Person
if made pursuant to any written agreement of the Company or such Restricted
Subsidiary in effect on the Issue Date; and (ix) Investments made as a result of
the receipt of non-cash consideration from an Asset Disposition that was made
pursuant to and in compliance with the provisions of Section 4.7 or a
disposition of assets pursuant to and in compliance with the provisions of
Article 5 hereof.
12
"Permitted Liens" means (i) pledges or deposits by the Company or any
Restricted Subsidiary under workmen's compensation laws, unemployment insurance
laws, other types of social security benefits or similar legislation, or good
faith deposits in connection with bids, tenders or contracts (other than for the
payment of Indebtedness) or leases to which the Company or any Restricted
Subsidiary is a party, or deposits to secure public or statutory obligations or
deposits of cash or United States government bonds to secure surety or appeal
bonds to which the Company or any Restricted Subsidiary is a party, or deposits
as security for contested taxes or import duties or for the payment of rent, in
each case incurred by the Company or any Restricted Subsidiary in the ordinary
course of business consistent with past practice; (ii) Liens imposed by law,
such as carriers', warehousemen's and mechanics' Liens, in each case for sums
not yet due from the Company or any Restricted Subsidiary or being contested in
good faith by appropriate proceedings by the Company or any Restricted
Subsidiary, as the case may be, or other Liens arising out of judgments or
awards against the Company or any Restricted Subsidiary with respect to which
the Company or such Restricted Subsidiary, as the case may be, shall then be
prosecuting an appeal or other proceedings for review; (iii) Liens for property
taxes or other taxes, assessments or governmental charges of the Company or any
Restricted Subsidiary not yet due or payable or subject to penalties for
nonpayment or which are being contested by the Company or such Restricted
Subsidiary, as the case may be, in good faith by appropriate proceedings; (iv)
Liens in favor of issuers of standby letters of credit, performance bonds and
surety bonds issued pursuant to Section 4.3(b)(vii) or Section 4.4(b)(iii); (v)
survey exceptions, encumbrances, easements or reservations of, or rights of
others for, licenses, rights-of-way, sewers, electric lines, telegraph and
telephone lines and other similar purposes or zoning or other restrictions as to
the use of real property of the Company or any Restricted Subsidiary incidental
to the ordinary course of conduct of the business of the Company or such
Restricted Subsidiary or as to the ownership of properties of the Company or any
Restricted Subsidiary, which, in either case, were not incurred in connection
with indebtedness and which do not in the aggregate materially adversely affect
the value of said properties or materially impair their use in the operation of
the business of the Company or any Restricted Subsidiary; (vi) Liens to secure
Indebtedness permitted under Section 4.3(a)(ii), Section 4.3(b)(i), Section
4.4(b)(vi) and Section 4.4(b)(vii); (vii) Liens outstanding immediately after
the Issue Date as set forth on Schedule II hereto (and not otherwise permitted
by clause (vi)); (viii) Liens on property, assets or shares of stock of any
Restricted Subsidiary at the time such Restricted Subsidiary became a Subsidiary
of the Company; provided, however, that (A) if any such Lien shall have been
Incurred in anticipation of such transaction, such property, assets or shares of
stock subject to such Lien shall have a Fair Market Value at the date of the
acquisition
13
thereof not in excess of the lesser of (1) the aggregate purchase price paid or
owed by the Company in connection with the acquisition of such Restricted
Subsidiary and (2) the Fair Market Value of all property and assets of such
Restricted Subsidiary and (B) any such Lien shall not extend to any other
property or assets owned by the Company or any Restricted Subsidiary; (ix) Liens
on property or assets at the time the Company or any Restricted Subsidiary
acquired such property or assets, including any acquisition by means of a merger
or consolidation with or into the Company or such Restricted Subsidiary;
provided, however, that (A) if any such Lien shall have been incurred in
anticipation of such transaction, such property or assets subject to such Lien
shall have a Fair Market Value at the date of the acquisition thereof not in
excess of the lesser of (1) the aggregate purchase price paid or owed by the
Company or such Restricted Subsidiary in connection with the acquisition thereof
and of any other property and assets acquired simultaneously therewith and (2)
the Fair Market Value of all such property and assets acquired by the Company or
such Restricted Subsidiary and (B) any such Lien shall not extend to any other
property or assets owned by the Company or any Restricted Subsidiary; (x) Liens
securing Indebtedness or other obligations of a Restricted Subsidiary owing to
the Company or a Wholly Owned Subsidiary; (xi) Liens to secure any extension,
renewal, refinancing, replacement or refunding (or successive extensions,
renewals, refinancings, replacements or refundings), in whole or in part, of any
Indebtedness secured by Xxxxx referred to in any of clauses (vii), (viii) and
(ix); provided, however, that any such Lien will be limited to all or part of
the same property or assets that secured the original Lien (plus improvements on
such property) and the aggregate principal amount of Indebtedness that is
secured by such Lien will not be increased to an amount greater than the sum of
(A) the outstanding principal amount, or, if greater, the committed amount, of
the Indebtedness described under clauses (vii), (viii) and (ix) at the time the
original Lien became a Permitted Lien under the Indenture and (B) an amount
necessary to pay any premiums, fees and other expenses Incurred by the Company
in connection with such refinancing, refunding, extension, renewal or
replacement; (xii) Liens on property or assets of the Company securing Hedging
Obligations so long as the related Indebtedness is, and is permitted to be under
Section 4.3, secured by a Lien on the same property securing the relevant
Hedging Obligation; (xiii) Liens securing Indebtedness incurred under (A) in the
case of the Company, any revolving credit facility; provided, that such
indebtedness constitutes Senior Indebtedness permitted hereunder and such Liens
relate only to accounts receivable, inventory and proceeds thereof (other than
proceeds from the disposition of inventory pursuant to any Sale/Leaseback
Transaction); and (B) in the case of any Foreign Restricted Subsidiary, any
foreign currency revolving credit facility; provided, that such Indebtedness was
incurred in compliance with Section 4.4(b)(vii) and such Liens relate only to
the accounts receivable, inventory and proceeds thereof of such Foreign
Restricted Subsidiary (other than proceeds from the disposition of inventory
pursuant to any Sale/Leaseback Transaction); and (xiv) Liens on property or
assets of the Company or any Restricted Subsidiary securing Indebtedness (1)
under Purchase Money Indebtedness or Capital Lease Obligations permitted under,
in the case of the Company, Section 4.3(b)(vi) and, in the case of such
Restricted Subsidiary, Section 4.4(b)(ii) or (2) under Sale/Leaseback
Transactions permitted under Section 4.13; provided, that (A) the amount of
Indebtedness Incurred in any specific case does not, at the time such
Indebtedness is Incurred, exceed the lesser of the cost or Fair Market Value of
the property or asset acquired or constructed in connection with such Purchase
Money Indebtedness or Capital Lease Obligation or subject to such Sale/Leaseback
Transaction, as the case may be, (B) such Lien shall attach to such property or
asset upon acquisition of such property or asset and or upon commencement of
such Sale/Leaseback Transaction, as the case may be, and (C) no property or
asset of the Company or any Restricted Subsidiary (other than the property or
asset acquired or contracted in connection with such Purchase Money Indebtedness
or Capital Lease Obligation or subject to such Sale/Leaseback Transaction, as
the case may be) are subject to any Lien securing such Indebtedness.
"Permitted Line of Business" means (i) the line or lines of business
in which the Company or any of its Subsidiaries is engaged on the Issue Date and
(ii) a line or lines of business similar or related to the line or lines of
business described in the foregoing clause (i).
14
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock," as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms hereof, a calculation in accordance with Article
11 of Regulation S-X promulgated under the Securities Act (to the extent
applicable), as interpreted in good faith by the Board of Directors after
consultation with the independent certified public accountants of the Company,
or otherwise a calculation made in good faith by the Board of Directors after
consultation with the independent certified public accountants of the Company,
as the case may be.
"Purchase Money Indebtedness" means, with respect to any Person, all
obligations of such Person (i) consisting of the deferred purchase price of any
property or assets, conditional sale obligations, obligations under any title
retention agreement (but excluding trade accounts payable arising in the
ordinary course of business) and other purchase money obligations, in each case
where the maturity of such obligation does not exceed the anticipated useful
life of the property or asset being financed, (ii) Incurred to finance the
acquisition or construction of any property or asset and (iii) Incurred to
finance the acquisition of 100% of the Capital Stock (other than directors'
qualifying shares) of any other Person.
"Qualified Capital Stock" of any person shall mean any Capital Stock
of such Person which is not Disqualified Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Redeemable Stock" means, with respect to any Person, 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) or otherwise (including, without
limitation, upon the happening of any event) (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (ii) is
convertible into or exchangeable for Indebtedness (other than Preferred Stock)
or Disqualified Stock or (iii) is redeemable at the option of the Holder
thereof, in whole or in part.
"Reference Bank" means a leading bank (i) engaged in transactions in
Eurodollar deposits in the international Eurocurrency market, (ii) not an
Affiliate of the Trustee and (iii) having an established place of business in
London.
15
"Refinancing Indebtedness" means Indebtedness that refunds,
refinances, replaces, renews, repays or extends (including pursuant to any
defeasance or discharge mechanism) (collectively, "refinances," "refinancing"
and "refinanced" shall have a correlative meaning) any Indebtedness (including
Indebtedness of the Company that refinances Indebtedness of any Restricted
Subsidiary and Indebtedness of any Restricted Subsidiary that refinances
Indebtedness of another Restricted Subsidiary), including Indebtedness that
refinances Refinancing Indebtedness; provided, that (i) the Refinancing
Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the
Indebtedness being refinanced, (ii) the Refinancing Indebtedness has an Average
Life at the time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being refinanced and (iii)
such Refinancing Indebtedness is Incurred in an aggregate principal amount (or
if issued with original issue discount, an aggregate issue price) that is equal
to or less than the sum of (A) the aggregate principal amount (or if issued with
original issue discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced and (B) any premiums, fees and other expenses paid
by the Company or the Restricted Subsidiary, as the case may be, in connection
with such refinancing; provided, further, that Refinancing Indebtedness shall
not include (x) Indebtedness of a Subsidiary of the Company that refinances
Indebtedness of the Company or (y) Indebtedness of the Company or a Restricted
Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary; provided,
further, that the covenants relating to the Refinancing Indebtedness are no more
restrictive in the aggregate than those of the Indebtedness being refinanced
and, if the Indebtedness being refinanced is subordinated to the Securities, the
Refinancing Indebtedness is at least as subordinated to the Securities as the
Indebtedness being refinanced.
"Registration Rights Agreement" means the Exchange and Registration
Rights Agreement, dated June 18, 1998, between the Company and NatWest Capital
Markets Limited.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby pursuant to a direct or indirect
arrangement the Company or any Restricted Subsidiary of the Company transfers
such property to a Person and the Company or such Restricted Subsidiary leases
it from such Person.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Initial Securities and the Exchange Securities
treated as a single class of securities, as amended or supplemented from time to
time in accordance with the terms hereof, that are issued pursuant to this
Indenture.
"Securities Act" means the Securities Act of 1933.
16
"Senior Indebtedness" means the principal of, interest (including,
without limitation, interest at the contract rate relating to such Senior
Indebtedness accruing after any proceeding or event referred to in clauses (8)
and (9) of Section 6.1) on, or any other amounts due with respect to, (i) the
Credit Facility, (ii) any Refinancing Indebtedness Incurred in respect of the
Credit Facility or in respect of any previous Refinancing Indebtedness Incurred
in respect of such Debt and (iii) any Indebtedness Incurred pursuant to clause
(a)(ii) of Section 4.3. For purposes of Section 4.7, the amount of
consideration received by the Company or any Restricted Subsidiary for the
assumption of Senior Indebtedness by any purchaser of the company's property,
assets or shares shall be equal to the face value of such Senior Indebtedness.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the Holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).
"Subordinated Obligation" means any Indebtedness of the Company
(whether outstanding on the Issue Date or thereafter Incurred) which is
subordinate or junior in right of payment to the Securities pursuant to the
terms of such Indebtedness or pursuant to a written agreement.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by (i) such
Person, (ii) such Person and one or more Subsidiaries of such Person or (iii)
one or more Subsidiaries of such Person.
"Temporary Cash Investments" means any of the following: (i)
investments in U.S. Government Obligations maturing within 90 days of the date
of acquisition thereof, (ii) investments in time deposit accounts, certificates
of deposit and money market deposits maturing within 90 days of the date of
acquisition thereof issued by a bank or trust company which is organized under
the laws of the United States of America or any State thereof having capital,
surplus and undivided profits aggregating in excess of $250,000,000 (or the
Dollar Equivalent thereof) and whose long-term debt is rated "A" or higher
according to Xxxxx'x Investors Service, Inc. (or such equivalent rating by at
least one "nationally recognized statistical rating organization" (as defined in
Rule 436 under the Securities Act)), (iii) repurchase obligations with a term of
not more than 7 days for underlying securities of the types described in clause
(i) entered into with a bank meeting the qualifications described in clause (ii)
and (iv) investments in commercial paper, maturing not more than 90 days after
the date of acquisition, issued by a corporation (other than an Affiliate of the
Company) organized and in existence under the laws of the United States of
America with a rating at the time as of which any investment therein is made of
"P-2" (or higher) according to Xxxxx'x Investors Service, Inc. or "A-2" (or
higher) according to Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
17
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of this Indenture; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"TIA" means, to the extent required by any such amendment, the Trust Indenture
Act of 1939, as so amended.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
of such Person in connection with the acquisition of goods or services,
including under the Company's Amended and Restated Master Supply Agreement dated
as of October 8, 1993, among the Company, SKC Limited and SKC America, Inc., as
such Agreement is amended from time to time.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and,
thereafter, means the successor.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Uniform Commercial Code" means the Uniform Commercial Code as in
effect from time to time in, unless the context otherwise specifies, New York.
"Unrestricted Subsidiary" means (i) each Subsidiary of the Company
that the Company has designated, or is deemed to have designated, pursuant to
the provisions described under Section 4.15 as an Unrestricted Subsidiary and
that has not been redesignated a Restricted Subsidiary and (ii) any Subsidiary
of an Unrestricted Subsidiary.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"U.S. Restricted Subsidiary" means any Restricted Subsidiary that is
not a Foreign Restricted Subsidiary.
"Voting Stock" of a corporation means all classes of Capital Stock of
such corporation then outstanding and normally entitled to vote in the election
of directors.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares) is owned by the
Company or another wholly Owned Subsidiary.
SECTION 1.2. Other Definitions.
18
Defined in
Term Section
---- -------
"Affiliate Transaction"....................... 4.8
"Agent Members"............................... 2.7
"Application Date"............................ 4.7(a)
"Asset Disposition Purchase Amount"........... 4.7(a)
"Asset Disposition Purchase Date"............. 4.7(a)
"Asset Disposition Purchase Notice"........... 4.7(d)
"Asset Disposition Purchase Offer"............ 4.7(a)
"Asset Disposition Purchase Price"............ 4.7(a)
"Asset Disposition Trigger" .................. 4.7(b)
"Bankruptcy Law".............................. 6.1
"Change of Control Offer"..................... 4.9(a)
"Change of Control Purchase Date"............. 4.9(a)
"Change of Control Purchase Notice"........... 4.9(a)
"Change of Control Purchase Price"............ 4.9(a)
"covenant defeasance option".................. 8.1(b)
"Custodian"................................... 6.1
"Defaulted Interest".......................... 2.11
"Event of Default"............................ 6.1
"Global Securities"........................... 2.1
"Legal Defeasance Option"..................... 8.1(b)
"Legal Holiday"............................... 11.7
"Notice of Default"........................... 6.1
"Paying Agent"................................ 2.3
"Payment"..................................... 9.2
"Permitted Indebtedness"...................... 4.3(b)
"Permitted Restricted Subsidiary Indebtedness" 4.4(b)
"Private Placement Legend".................... 2.14
"Refinanced Indebtedness"..................... 4.3(e)
"Registrar"................................... 2.3
"Restricted Payment".......................... 4.5
"Special Redemption".......................... 3.02
"Surviving Entity"............................ Article 5
SECTION 1.3. Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder.
19
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.4. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) the principal amount of any noninterest bearing or other discount
security at any date shall be the principal amount thereof that would be
shown on a balance sheet of the issuer dated such date prepared in
accordance with GAAP; and
(7) the principal amount of any Preferred Stock shall be the greater
of (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.
ARTICLE 2
The Securities
SECTION 2.1. Form and Dating. The Initial Securities and the
Trustee's certificate of authentication thereon shall be substantially in the
form of Exhibit A hereto which is hereby incorporated in and expressly made a
part of this Indenture. The Exchange Securities and the Trustee's certificate
of authentication thereon shall be substantially in the form of Exhibit B hereto
which is incorporated in and expressly made a part of this Indenture. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule, agreements to which the Company is subject, if any, or usage
(provided that any such notation, legend or endorsement is in a form acceptable
to the Company). The Company shall furnish any such legend not contained in
Exhibit A or Exhibit B, as the case may be, to the Trustee in writing.
20
Each Security shall be dated the date of its authentication. The terms of the
Securities set forth in Exhibit A or Exhibit B, as the case may be, are part of
the terms of this Indenture.
The Securities shall be issued initially in the form of one or more
permanent global Securities in registered form, substantially in the form set
forth in Exhibit A (the "Global Securities"), deposited with, or on behalf of,
the Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. Each Global Security shall bear such legend as may be
required or reasonably requested by the Depositary.
SECTION 2.2. Execution and Authentication. Two Officers shall sign
the Securities for the Company by manual or facsimile signature. The Company's
seal shall be impressed, affixed, imprinted or reproduced on the Securities and
may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers, authenticate and make available for delivery (i) Initial Securities
for original issue in an aggregate principal amount not to exceed the Initial
Face Amount and (ii) Exchange Securities from time to time for issue only in
exchange for a like principal amount of Initial Securities, in each case
registered in the name of the Depositary or the nominee of the Depositary and
shall deliver such Global Securities to the Depositary or pursuant to the
Depositary's instructions. Such order shall specify the amount of the Global
Securities to be authenticated. The aggregate principal amount of Securities
outstanding at any time may not exceed the Initial Face Amount except as
provided in Section 2.7. The Securities shall be issued in fully registered
form, without coupons in Authorized Denominations.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Unless limited by the terms of
such appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Registrar, Paying Agent or agent for service of notices and
demands.
SECTION 2.3. Registrar and Paying Agent. The Company shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"), at least one of
each such office to be located in the City of New York. The Registrar shall
keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent.
21
The Company shall enter into an appropriate agency agreement with
any Registrar, Paying Agent or co-registrar not a party to this Indenture,
which shall incorporate the terms of the TIA. The agreement shall implement
the provisions of this Indenture that relate to such agent. The Company
shall notify the Trustee of the name and address of any such agent. If the
company fails to maintain a Registrar or Paying Agent, the Trustee shall act
as such and shall be entitled to appropriate compensation therefor pursuant
to Section 7.7. The Company or any of its domestically incorporated Wholly
Owned Subsidiaries may act as Paying Agent, Registrar, co-registrar or
transfer agent.
The Company initially appoints the Trustee as Registrar and Paying
Agent in connection with the Securities.
SECTION 2.4. Deposit of Moneys; Paying Agent To Hold Money in
Trust. Prior to 11:00 a.m. New York City time on each due date of the
principal and interest on any Security, the Company shall deposit with the
Paying Agent a sum in U.S. dollars sufficient to pay such principal and
interest when so becoming due. The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all money held by
the Paying Agent for the payment of principal of or interest on the
Securities and shall notify the Trustee of any default by the Company in
making any such payment. If the Company or a Subsidiary of the Company acts
as Paying Agent, it shall segregate the money held by it as Paying Agent and
hold it as a separate trust fund. The Company 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 the Paying Agent. Upon complying with this Section,
the Paying Agent shall have no further liability for the money delivered to
the Trustee.
SECTION 2.5. Securityholder Lists. The Trustee shall preserve in
as current a form as is reasonably practicable the most recent list available
to it of the names and addresses of Securityholders. If the Trustee is not
the Registrar, the Company shall 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
Securityholders.
SECTION 2.6. Transfer and Exchange. The Securities shall be
issued in registered form and shall be transferable only upon the surrender
of a Security for registration of transfer. When a Security is presented to
the Registrar or a co-registrar with a request to register a transfer, the
Registrar shall register the transfer as requested if the requirements of
Section 8-401(l) of the Uniform Commercial Code are met. When Securities are
presented to the Registrar or a co-registrar with a request to exchange them
for an equal principal amount of Securities 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 Company shall
execute and the Trustee shall authenticate Securities at the Registrar's or
co-registrar's request. No service charge shall be made for any registration
of transfer or exchange of Securities, but the Company 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.
22
Prior to the due presentation for registration of transfer of any
Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such Security and for all
other purposes whatsoever, whether or not such Security is overdue, and none
of the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar shall be affected by notice to the contrary. Furthermore, any
Holder of a Global Security shall, by acceptance of such Global Security,
agree that transfers of beneficial interests in such Global Security may be
effected only through a book-entry system maintained by the Depositary (or
its agent), and that ownership of a beneficial interest in the Global
Security shall be required to be reflected in a book entry.
The Company shall not be required (i) to issue, register the
transfer of or exchange Securities during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption
of Securities and ending at the close of business on the day of such mailing,
or (ii) to register the transfer of or exchange any Security selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture will evidence the same debt and will be entitled to
the same benefits under this Indenture as the Securities surrendered upon
such transfer or exchange.
SECTION 2.7. Book-Entry Provisions for Global Securities. (a)
The Global Securities initially shall (i) be registered in the name of the
Depositary or the nominee of the Depositary and (ii) be delivered to the
Trustee as custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary, or the Trustee as its custodian, or
under any Global Security, and the Depositary may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute legal
owner of such Global Security for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a beneficial
owner of any Security.
(b) Transfers of a Global Security shall be limited to transfers
of such Global Security in whole, but not in part, to the Depositary, its
successors or their respective nominees. Interests of beneficial owners in a
Global Security may be transferred in accordance with the applicable rules
and procedures of the Depositary and the provisions of Section 2.6.
(c) The registered holder of a Global Security may grant proxies
and otherwise authorize any person, including Agent Members and persons that
may hold interests through Agent Members, to take any action which a Holder
is entitled to take under this Indenture or the Securities.
23
SECTION 2.8. Certificated Securities. If (i) the Company
notifies the Trustee in writing that DTC is no longer willing or able to act
as a depositary or DTC ceases to be registered as a clearing agency under the
Exchange Act and a successor depositary is not appointed within 90 days of
such notice or cessation, (ii) the Company, at its option, notifies the
Trustee in writing that it elects to cause the issuance of Securities in
definitive form under the Indenture and by written order signed by two
officers directs the Trustee to authenticate such Securities or (iii) upon
the occurrence of certain other events as provided in the Indenture, then,
upon surrender by DTC of the Global Securities, Certificated Securities will
be issued to each person that DTC identifies as the beneficial owner of the
Securities represented by the Global Securities. Upon any such issuance, the
Trustee is required to register such Certificated Securities in the name of
such person or persons (or the nominee of any thereof and cause the same to
be delivered thereto.
Neither the Company nor the Trustee shall be liable for any delay
by DTC or any Participant or Indirect Participant in identifying the
beneficial owners of the related Securities and each such person may
conclusively rely on, and shall be protected in relying on, instructions from
DTC for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the Securities to be
issued.)
SECTION 2.9. Replacement Securities. If a mutilated Security is
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall
issue and the Trustee shall authenticate a replacement Security if the
requirements of Section 8-405 of the Uniform Commercial Code are met and the
Holder satisfies any other reasonable requirements of the Trustee or the
Company. If required by the Trustee or the Company, such Holder shall
furnish an indemnity bond sufficient in the judgment of the Company and the
Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar
and any co-registrar from any loss which any of them may suffer if a Security
is replaced. The Company and the Trustee may charge the Holder for their
expenses in replacing a Security.
Every replacement Security is an additional obligation of the
Company.
SECTION 2.10. Outstanding Securities. Securities outstanding at
any time are all Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation and those described in
this Section as not outstanding. A Security does not cease to be outstanding
because the Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.9, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance
with this Indenture, at a redemption date or maturity date money sufficient
to pay all principal of, and premium, if any, and interest payable on, that
date with respect to the Securities (or portions thereof) to be redeemed or
maturing, as the case may be, then on and after that date such Securities (or
portions thereof) cease to be outstanding and interest on them ceases to
accrue.
24
In determining whether the Holders of the required principal amount
of Securities have concurred in any direction, waiver or consent, Securities
owned by the Company or by any Subsidiary thereof or by any other Affiliate
controlled by the Company shall be considered as though not outstanding,
except that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent, only
Securities which the Trustee actually knows are so owned shall be so
disregarded.
In determining whether the Holders of the required principal amount
of Securities have (i) directed the time, method or place of conducting any
proceeding for any remedy available to the Trustee hereunder, or exercising
any trust or power conferred upon the Trustee; (ii) consented to the waiver
of any past Event of Default and its consequences; or (iii) consented to the
postponement of any interest payment, Securities owned by Affiliates of the
Company shall be disregarded and considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected
in relying on any such direction, waiver or consent, only Securities which
the Trustee actually knows are so owned shall be so disregarded. The Company
shall notify the Trustee in writing when it or any of its Affiliates
purchases or otherwise acquires Securities, of the aggregate principal amount
of such Securities so purchased or otherwise acquired.
SECTION 2.11. Temporary Securities. Until definitive Securities
are ready for delivery, the Company may prepare and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have variations
that the Company considers appropriate for temporary Securities. Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities and deliver them in exchange for temporary
Securities.
SECTION 2.12. Cancellation. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying
Agent shall forward to the Trustee any Securities surrendered to them for
registration of transfer, exchange or payment. The Trustee and no one else
shall cancel all Securities surrendered for registration of transfer,
exchange, payment or cancellation and, upon request, deliver such canceled
Securities to the Company. The Company may not issue new Securities to
replace Securities it has redeemed, paid or delivered to the Trustee for
cancellation.
SECTION 2.13. Defaulted Interest. Any interest on any Security
which is payable, but is not punctually paid or duly provided for, on the
dates and in the manner provided in the Securities and this Indenture (herein
called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant record date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (i) or (ii) below:
(i) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities are registered at the
close of business on a special record date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Security and the date of the proposed payment, and at the
same time the
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Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted Interest as
in this clause provided. Thereupon the Trustee shall fix a special record
date for the payment of such Defaulted Interest which shall be not more than
15 days and not less than 10 days prior to the date of the proposed payment
and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of such
special record date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
special record date therefor to be given to each Holder, not less than 10
days prior to such special record date. Notice of the proposed payment of
such Defaulted Interest and the special record date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Securities are registered at the close of business on such special record
date.
(ii) The Company may make payment of any Defaulted Interest on the
Securities in any other lawful manner not inconsistent with the requirements
of any securities exchange on which the Securities may be listed and upon
such notice as may be required by such exchange, if, after notice given by
the Company to the Trustee of the proposed payment pursuant to this clause,
such manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.13, each
Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
SECTION 2.14. Restrictive Legends. Each Global Note that
constitutes a Restricted Security shall bear the following legend (the
"Private Placement Legend") unless otherwise agreed by the Company and the
Securityholder thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION, NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY
AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR
SO LONG AS THE
26
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,(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 "ACCREDITED INVESTOR" WITHIN THE MEANING
OF RULE 501 (a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUER AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE.
SECTION 2.15. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and
Non-U.S. Persons. The following provisions shall apply with respect to the
registration of any proposed transfer of a Security constituting a Restricted
Security to any Institutional Accredited Investor which is not a QIB or to
any Non-U.S. Person:
(i) the Registrar shall register the transfer of any Security
constituting a Restricted Security, whether or not such Security bears the
Private Placement Legend, if (x) the requested transfer is after June 18,
2000 or (y) (1) in the case of a transfer to an Institutional Accredited
Investor which is not a QIB (excluding Non-U.S. Persons), the proposed
transferee has delivered to the Registrar a certificate substantially in the
form of Exhibit C hereto or (2) in the case of a transfer to a Non-U.S.
Person, the proposed transferor has delivered to the Registrar a certificate
substantially in the form of Exhibit D hereto; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in the Global Note, upon receipt by the Registrar of (x)
the certificate, if any, required by paragraph (i) above and (y) instructions
given in accordance with the Depositary's and the Registrar's procedures,
whereupon (a) the Registrar shall reflect on its books and records the date
and (if the transfer does not involve a transfer of outstanding certificated
Securities) a decrease in the principal amount of the Global Note in an
amount equal to the principal amount of the beneficial interest in the Global
Note to be transferred, and (b) the Company shall execute and the Trustee
shall authenticate and deliver one or more certificated Securities of like
tenor and amount.
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(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Security
constituting a Restricted Security to a QIB (excluding transfers to Non-U.S.
Persons):
(i) the Registrar shall register the transfer if such transfer is
being made by a proposed transferor who has checked the box provided for on
the form of Security stating, or has otherwise advised the Company and the
Registrar in writing, that the sale has been effected in compliance with the
provisions of Rule 144A to a transferee who has signed the certification
provided for on the form of Security stating, or has otherwise advised the
Company and the Registrar in writing, that it is purchasing the Security for
its own account or an account with respect to which it exercises sole
investment discretion and that any such account is a QIB within the meaning
of Rule 144A, and it is aware that the sale to it is being made in reliance
on Rule 144A and acknowledges that it has received such information regarding
the Company as it has requested pursuant to Rule 144A or has determined not
to request such information and that it is aware that the transferor is
relying upon its foregoing representations in order to claim the exemption
from registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member and the
Securities to be transferred consist of certificated Securities which after
transfer are to be evidenced by an interest in the Global Note, upon receipt
by the Registrar of instructions given in accordance with the Depositary's
and the Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Global Note
in an amount equal to principal amount of the certificated Securities to be
transferred, and the Trustee shall cancel the certificated Securities so
transferred.
(c) Private Placement Legend. Upon the registration of the
transfer, exchange or replacement of Securities not bearing the Private
Placement Legend, the Registrar shall deliver Securities that do not bear the
Private Placement Legend. Upon the registration of the transfer, exchange or
replacement of Securities bearing the Private Placement Legend, the Registrar
shall deliver only Securities that bear the Private Placement Legend unless
(i) the circumstance contemplated by paragraph (a)(i)(x) of this Section 2.15
exists or (ii) there is delivered to the Registrar an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act.
(d) General. By its acceptance of any Security bearing the
Private Placement Legend, each Holder of such a Security acknowledges the
restrictions on transfer of such Security set forth in this Indenture and in
the Private Placement Legend and agrees that it will transfer such Security
only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to this Section 2.15 until the
earlier of (i) two years from the date of receipt or (ii) the date the
Securities shall have been redeemed or paid in full. The Company shall have
the right to inspect and make copies of all such letters, notices or other
written communications at any reasonable time upon the giving of reasonable
written notice to the Registrar.
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SECTION 2.16. Record Date. The Company may set a record date for
purposes of determining the identity of Securityholders entitled to vote or
to consent to any action by vote or consent authorized or permitted by
Sections 6.4 and 6.5. Unless this Indenture provides otherwise, such record
date shall be the later of 30 days prior to the first solicitation of such
consent or the date of the most recent list of Securityholders furnished to
the Trustee pursuant to Section 2.5 prior to such solicitation.
SECTION 2.17. CUSIP Numbers. The Company in issuing the
Securities may use CUSIP numbers (if then generally in use), and, if so, the
Trustee shall use CUSIP numbers in notices of redemption as of convenience to
Holders; provided, that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption and that reliance
may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers.
ARTICLE 3
Redemption
SECTION 3.1. Notices to Trustee. If the Company elects to redeem
Securities pursuant to paragraph 5 of the Securities or is required to redeem
Securities pursuant to paragraph 6 of the Securities, it shall notify the
Trustee in writing of the redemption date, the principal amount of Securities
to be redeemed and the paragraph of the Securities pursuant to which the
redemption will occur.
The Company shall give each notice to the Trustee provided for in
this Section at least 45 days (or such lesser time as is acceptable to the
Trustee) but not more than 60 days before the redemption date unless the
Trustee consents to a shorter period. Such notice shall be accompanied by an
Officers' Certificate and an Opinion of Counsel from the Company to the
effect that such redemption will comply with the conditions herein. If fewer
than all the securities are to be redeemed, the record date relating to such
redemption shall be selected by the Company and given to the Trustee, which
record date shall be not less than 15 days after the date of notice to the
Trustee.
SECTION 3.2. Selection of Securities To Be Redeemed. If fewer
than all the Securities are to be redeemed, the Trustee shall select the
Securities to be redeemed pro rata or by lot or, at the discretion of the
Trustee, by a method that complies with applicable legal and securities
exchange requirements, if any, and that the Trustee considers fair and
appropriate and in accordance with methods generally used at the time of
selection by fiduciaries in similar circumstances. The Trustee shall make
the selection from outstanding Securities not previously called for
redemption. The Trustee may select for redemption portions of the principal
of Securities that have denominations larger than $1,000. Securities and
portions of them the Trustee selects shall be in Authorized Denominations.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. The Trustee
shall notify the Company promptly of the Securities or portions of Securities
to be redeemed.
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If less than all of the Notes are to be redeemed, the Trustee shall
select by such methods as the Trustee shall deem to be fair and appropriate
the particular Notes to be redeemed or any portion thereof that is an
integral multiple of no more than $1,000. Notwithstanding the foregoing, the
Company may not make any optional redemption of the Notes unless
contemporaneously with such optional redemption it redeems Existing Notes the
aggregate principal amount of which bears the same relationship to the
aggregate principal amount of the Existing Notes outstanding immediately
prior to such optional redemption as the aggregate principal amount of the
Notes being redeemed bears to the aggregate principal amount of the Notes
outstanding immediately prior to such optional redemption. The Notes will
not have the benefit of a sinking fund.
SECTION 3.3. Notice of Redemption. At least 15 days but not more
than 60 days before a date for redemption of Securities, the Company shall
mail, or cause to be mailed, a notice of redemption by first-class mail to
each Holder of Securities to be redeemed.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be redeemed,
the identification and principal amounts of the particular Securities to be
redeemed;
(6) that, unless the Company defaults in making such redemption
payment, interest on Securities (or portions thereof) called for redemption
ceases to accrue on and after the redemption date;
(7) the paragraph of the Securities pursuant to which the Securities
called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such
event, the Company shall provide the Trustee with the information required by
this Section.
SECTION 3.4. Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable
on the redemption date and at the redemption price stated in the notice.
Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price stated in the notice, plus accrued interest to the redemption
30
date (subject to the right of Holders of record on the relevant record date
to receive interest due on the related interest payment 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.
SECTION 3.5. Deposit of Redemption Price. Prior to 11:00 a.m.
New York City time on the redemption date, the Company shall deposit with the
Paying Agent (or, if the Company or a Subsidiary is the Paying Agent shall
segregate and hold in trust) money in U.S. dollars sufficient to pay the
redemption price of and accrued interest (subject to the right of Holders of
record on the relevant record date to receive interest due on the related
interest payment date) on all Securities to be redeemed on that date other
than Securities or portions of Securities called for redemption which have
been delivered by the Company to the Trustee for cancellation.
SECTION 3.6. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security
surrendered.
ARTICLE 4
Covenants
SECTION 4.1. Payment of Securities. The Company shall promptly
pay the principal of and interest on the Securities in U.S. dollars on the
dates and in the manner provided in the Securities and in this Indenture.
Principal and interest shall be considered paid on the date due if on such
date the Trustee or the Paying Agent (other than the Company or a Wholly
Owned Subsidiary acting as paying agent) holds in accordance with this
Indenture money sufficient to pay all principal and interest then due.
The Company shall pay interest on overdue principal at the rate
specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.2. SEC Reports. The Company shall file the annual
report and other documents, reports and information required by Section 13 or
15(d) of the Exchange Act with the SEC and, upon such filing, the Company
shall (i) promptly furnish such reports, documents and information to the
Trustee and (ii) within 15 days after such filing with the SEC, furnish, or
cause the Trustee to furnish, such reports, documents and information to the
Securityholders. The Company shall use its best efforts to remain subject to
the periodic reporting requirements of Section 13 of the Exchange Act. In
the event the Company is no longer subject to the periodic reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall
file with the SEC and furnish to the Trustee and to the Securityholders the
annual reports and other documents, reports and information as if it were
subject to such reporting requirements; provided, however, that the Company
shall not be so obligated to file such reports, documents and information
with the SEC if the SEC does not permit or accept such filings, in which
event such reports, documents and information shall be provided to the
Trustee and the Holders at the times
31
the Company would have been required to provide such reports, documents and
information had it continued to have been subject to such reporting
requirements. The Company also shall comply with the other provisions of TIA
Section 314(a).
Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall
not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 4.3. Limitation on Indebtedness. (a) The Company shall
not, directly or indirectly, Incur any Indebtedness; provided, however, that:
(i) the Company may Incur Indebtedness ranking on a parity with the
Securities or which is subordinated in right of payment to the Securities
pursuant to the terms of such Indebtedness or pursuant to a written
agreement, if no Default or Event of Default shall have occurred and be
continuing at the time of such Incurrence or would occur as a consequence of
such Incurrence and after giving pro forma effect to such Incurrence, the
Consolidated Coverage Ratio would be equal to at least 1.75 to 1; and (ii)
the Company may Incur Senior Indebtedness if no Default or Event of Default
shall have occurred and be continuing at the time of such Incurrence or would
occur as a consequence of such Incurrence and (A) after giving pro forma
effect to such Incurrence, the Consolidated Coverage Ratio would be at least
equal to 2.5 to 1 or (B) after such Incurrence, the total principal amount of
Senior Indebtedness would not exceed $80,000,000.
(b) Notwithstanding the foregoing, the Company may Incur the
following Indebtedness if no Default or Event of Default shall have occurred
and be continuing at the time of such Incurrence or would occur as a
consequence of such Incurrence (collectively, "Permitted Indebtedness"):
(i) Indebtedness to be outstanding on the Issue Date and listed on
Schedule I to this Indenture;
(ii) Indebtedness represented by the Securities;
(iii) Indebtedness (A) under Interest Rate Protection Agreements
relating to Indebtedness permitted hereunder entered into in the ordinary
course of the Company's financial management and not for speculative
purposes; provided, however, that the notional amount of each such Interest
Rate Protection Agreement does not exceed the principal amount of the
Indebtedness to which such Interest Rate Protection Agreement relates; or
(B) under Currency Exchange Protection Agreements entered into in the
ordinary course of the Company's financial management and not for
speculative purposes; provided, however, in the case of either clause (A)
or (B), any such Interest Rate Protection Agreement or Currency Exchange
Protection Agreement, as the case may be, does not increase the
Indebtedness of the Company outstanding at any time other than as a result
of fluctuations in the interest rates or exchange rates, as the case may
be, or by reason of customary fees, indemnities and compensation payable
thereunder;
32
(iv) Indebtedness owing to and held by any Wholly Owned Subsidiary;
provided, however, that any subsequent issuance or transfer of any Capital
Stock that results in any such Wholly Owned Subsidiary ceasing to be a
Wholly Owned Subsidiary or any subsequent transfer of any such Indebtedness
(except to the Company or another Wholly Owned Subsidiary) shall be deemed,
in each case, to constitute the incurrence of such Indebtedness by the
issuer thereof;
(v) Indebtedness Incurred in connection with a prepayment of
Securities pursuant to a Change of Control Offer; provided, however, that
the aggregate principal amount of such Indebtedness does not exceed 101% of
the aggregate principal amount of the Securities prepaid; provided,
further, however, that such Indebtedness (A) has an Average Life equal to
or greater than the remaining Average Life of the Securities and (B) does
not mature prior to the Stated Maturity of the Securities;
(vi) Indebtedness in respect of Purchase Money Indebtedness or Capital
Lease Obligations directly Incurred by the Company; provided, however, that
the sum of (A) the aggregate principal amount of Purchase Money
Indebtedness incurred by the Company or by Restricted Subsidiaries as
permitted under Section 4.4(b)(ii) and (B) the aggregate amount of Capital
Lease Obligations Incurred by the Company or Incurred by Restricted
Subsidiaries as permitted under Section 4.4(b)(ii) does not at any one time
outstanding exceed $30,000,000 (such maximum permitted amount to increase
by $10,000,000 on each March 24, commencing on March 24, 1999);
(vii) Indebtedness Incurred (A) in the ordinary course of business
of the Company with respect to trade credit made available to the Company
in connection with the obtaining of goods or services by the Company
(including commercial letters of credit, bankers' acceptances or
accommodation Guarantees for the benefit of trade creditors or suppliers),
in each case for a period not to exceed 180 days, in an amount not to
exceed the purchase price for the goods or services for which such credit
is made available and which do not constitute obligations for borrowed
money, and (B) with respect to standby letters of credit, performance bonds
and surety bonds that do not constitute obligations for borrowed money
Incurred by the Company in the ordinary course of business relating to
services to be performed by or on behalf of the Company;
(viii) Indebtedness in respect of Guarantees by the Company of
Indebtedness of any Restricted Subsidiary permitted to be Incurred under
Section 4.4;
(ix) Indebtedness under the Credit Facility in an aggregate principal
amount not to exceed $80,000,000 less, at any specified date, an amount
equal to actual permanent repayments of such Indebtedness prior to such
date, regardless of any subsequent increase in the aggregate principal
amount of such Indebtedness pursuant to any amendment or modification of,
or supplement to, the Credit Facility;
(x) Refinancing Indebtedness Incurred in respect of Indebtedness
Incurred pursuant to clause (i), (ii), or (v) above; and
33
(xi) in addition to any Indebtedness permitted by clauses (i) through
(x) above, up to an aggregate of (A) $25,000,000 in principal amount of
Indebtedness at any one time outstanding minus (B) the principal amount of
Indebtedness at such time outstanding of any Restricted Subsidiaries
permitted pursuant to section 4.4(b)(vi).
(c) The Company shall not directly or indirectly Incur any
Indebtedness if the proceeds thereof are used, directly or indirectly, to
repay, prepay, redeem, defease, retire, refund or refinance any Subordinated
Obligations unless such Indebtedness shall be subordinated to the Securities
to at least the same extent as such Subordinated Obligations.
(d) For purposes of determining the outstanding principal amount
of any particular Indebtedness Incurred pursuant to this Section or Section
4.4, (1) Indebtedness permitted by this Section or Section 4.4 need not be
permitted solely by reference to one provision permitting such Indebtedness
but may be permitted in part by one such provision and in part by one or more
other provisions of this Section or Section 4.4 permitting such Indebtedness
and (2) in the event that Indebtedness or any portion thereof meets the
criteria of more than one of the types of Indebtedness described in this
Section or Section 4.4, the Company, in its sole discretion, shall classify
such Indebtedness and only be required to include the amount of such
Indebtedness in one of such types.
(e) For purposes of determining whether the principal amount of
any Refinancing Indebtedness permitted by this Section or Section 4.4 does
not, in the event it is issued in a currency different from the currency in
which the Indebtedness being refunded or refinanced or paid at maturity
("Refinanced Indebtedness") was issued, exceed the principal amount of the
Refinanced Indebtedness, the spot rate for the purchase of the currency of
the Refinanced Indebtedness with the currency of the Refinancing
Indebtedness, as published in The Wall Street Journal in the "Exchange Rates"
column under the heading "Currency Trading" on the date two Business Days
prior to such determination, shall be used. If The Wall Street Journal does
not publish such spot rate on such date, then the spot rate for the purchase
of the currency of the Refinanced Indebtedness with the currency of the
Refinancing Indebtedness, as quoted by Citibank, N.A., or any successor
thereto, in New York City at approximately 11:00 a.m. (New York time) on the
date two Business Days prior to such determination, shall be used.
Except as provided in the preceding paragraph, for purposes of
determining the Dollar Equivalent of any Indebtedness denominated in a
currency other than U.S. dollars outstanding at any time as permitted by this
Section or Section 4.4, such Dollar Equivalent shall be the Dollar Equivalent
of such currency at the date such Indebtedness is issued; provided, however,
that if such Indebtedness constituted Refinancing Indebtedness, such
conversion shall be made based on the Dollar Equivalent of the Refinanced
Indebtedness at the date of the issuance of the Refinanced Indebtedness (or
any preceding Refinanced Indebtedness, as applicable).
SECTION 4.4. Limitation on Restricted Subsidiary Indebtedness and
Preferred Stock. (a) The Company shall not permit any Restricted Subsidiary
to, directly or indirectly, Incur any Indebtedness or issue any Preferred
Stock unless (i) no Default or Event of Default shall have occurred and be
continuing at the time of such Incurrence or would occur as a consequence
34
of such Incurrence and (ii) such Indebtedness or Preferred Stock is Permitted
Restricted Subsidiary Indebtedness under Section 4.4(b).
(b) "Permitted Restricted Subsidiary Indebtedness" means:
(i) Indebtedness or Preferred Stock to be outstanding on the Issue
Date and listed on Schedule I to this Indenture;
(ii) Indebtedness in respect of Purchase Money Indebtedness or Capital
Lease Obligations directly Incurred by any Restricted Subsidiary; provided,
however, that the sum of (A) the aggregate amount of Capital Lease
Obligations Incurred by Restricted Subsidiaries or Incurred by the Company
pursuant to Section 4.3(b)(vi) and (B) the aggregate principal amount of
Purchase Money Indebtedness Incurred by Restricted Subsidiaries or Incurred
by the Company pursuant to Section 4.3(b)(vi) does not at any one time
outstanding exceed $30,000,000 (such maximum permitted amount to increase
by $10,000,000 on each March 24, commencing March 24, 1999);
(iii) Indebtedness Incurred (A) in the ordinary course of business
of any Restricted Subsidiary with respect to trade credit made available to
such Restricted Subsidiary in connection with the obtaining of goods or
services by such Restricted Subsidiary (including commercial letters of
credit, bankers' acceptances or accommodation Guarantees for the benefit of
trade creditors or suppliers), in each case for a period not to exceed 180
days, in an amount not to exceed the purchase price for the goods or
services for which such credit is made available and which do not
constitute obligations for borrowed money and (B) standby letters of
credit, performance bonds and surety bonds that do not constitute
obligations for borrowed money Incurred by any Restricted Subsidiary in the
ordinary course of business relating to services to be performed by or on
behalf of such Restricted Subsidiary;
(iv) Indebtedness (A) under Interest Rate Protection Agreements
relating to Indebtedness permitted hereunder entered into in the ordinary
course of any Restricted Subsidiary's financial management and not for
speculative purposes; provided, however, that the notional amount of each
such Interest Rate Protection Agreement does not exceed the principal
amount of the Indebtedness to which such Interest Rate Protection Agreement
relates; or (B) under Currency Exchange Protection Agreements entered into
in the ordinary course of any Foreign Subsidiary's financial management and
not for speculative purposes; provided, however, in the case of either
clause (A) or (B), any such Interest Rate Protection Agreement or Currency
Exchange Protection Agreement, as the case may be, does not increase the
Indebtedness of such Subsidiary outstanding at any time other than as a
result of fluctuations in the interest rates or exchange rates, as the case
may be, or by reason of customary fees, indemnities and compensation
payable thereunder;
(v) Indebtedness or Preferred Stock owing to and held by the Company
or any Wholly Owned Subsidiary; provided, however, that any subsequent
issuance or transfer of any Capital Stock that results in any such Wholly
Owned Subsidiary ceasing to be a
35
Wholly Owned Subsidiary or any subsequent transfer of any such Indebtedness
or Preferred Stock (except to the Company or a Wholly Owned Subsidiary)
shall be deemed, in each case, to constitute the Incurrence of such
Indebtedness or Preferred Stock by the issuer thereof;
(vi) Refinancing Indebtedness Incurred in respect of Indebtedness
Incurred pursuant to clause (i) above; and
(vii) in addition to any Indebtedness permitted by clauses (i)
through (vi) above, up to an aggregate of $10,000,000 in principal amount
of Indebtedness of Foreign Restricted Subsidiaries at any one time
outstanding.
SECTION 4.5. Limitation on Restricted Payments. (a) The Company
shall not, and shall not permit any Restricted Subsidiary, to, directly or
indirectly, (i) declare or pay any dividend on, or make any distribution on
or in respect of, its Capital Stock (including any payment in connection with
any merger or consolidation involving the Company), except dividends or
distributions payable solely in its Capital Stock (other than Disqualified
Stock) or in options, warrants or other rights to purchase such Capital Stock
and except dividends or distributions payable solely to the Company or any
Restricted Subsidiary, (ii) purchase, redeem, retire or otherwise acquire for
value any Capital Stock of the Company or any Restricted Subsidiary held by
Persons other than the Company or any Restricted Subsidiary, (iii) purchase,
repurchase, redeem, defease or otherwise acquire or retire for value
(including pursuant to mandatory repurchase covenants), prior to any
scheduled repayment, scheduled sinking fund payment or other scheduled
maturity, any Subordinated Obligation or (iv) make any Investment (other than
a Permitted Investment) in any Person (any such dividend, distribution,
purchase, redemption, repurchase, defeasance, other acquisition, retirement
or Investment being herein referred to as a "Restricted Payment"), if at the
time of and after giving effect to the proposed Restricted Payment:
(1) a Default or Event of Default shall have occurred and be
continuing (or would result therefrom);
(2) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.3(a)(i); or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
determined in good faith by the Board of Directors and evidenced by a Board
Resolution furnished to the Trustee) declared or made since the Existing
Notes Issue Date, would exceed, without duplication. the sum of:
(A) an amount equal to 50% of the Consolidated Net Income
accrued during the period (treated as one accounting period) beginning
on the first day of the fiscal quarter of the Company immediately
following the fiscal quarter in which the Existing Notes Issue Date
occurs and ending on the last day of the Company's last fiscal quarter
ended at least 45 days prior to the date of such proposed
36
Restricted Payment (or, if such Consolidated Net Income shall be a
deficit, minus 100% of such deficit) and minus 100% of the amount of
any write-downs, writeoffs, other negative revaluations and other
negative extraordinary charges not otherwise reflected in Consolidated
Net Income during such period;
(B) the aggregate Net Cash Proceeds received by the Company from
the issue or sale of its Capital Stock, including Capital Stock of the
Company issued upon conversion of convertible debt or the exercise of
options, warrants or rights to purchase Capital Stock of the Company,
but excluding Disqualified Stock, subsequent to the Existing Notes
Issue Date (other than an issuance or sale to (i) a Subsidiary of the
Company, (ii) an employee stock ownership plan or other trust
established by the Company or any of its Subsidiaries or (iii)
management employees);
(C) the amount by which Indebtedness of the Company or its
Restricted Subsidiaries is reduced on the Company's balance sheet upon
the conversion or exchange (other than by a Subsidiary of the Company)
subsequent to the Existing Notes Issue Date of any Indebtedness of the
Company or its Restricted Subsidiaries convertible or exchangeable for
Capital Stock (other than Disqualified Stock) of the Company (less the
amount of any cash or other property distributed by the Company or any
Restricted Subsidiary upon such conversion or exchange); and
(D) the amount equal to the net reduction in Investments in
Unrestricted Subsidiaries resulting from (i) payments of dividends,
repayments of loans or advances or other transfers of assets to the
Company or any Restricted Subsidiary from Unrestricted Subsidiaries or
(ii) the redesignation of Unrestricted Subsidiaries as Restricted
Subsidiaries (valued in each case as provided in the definition of
"Investment") not to exceed, in the case of any Unrestricted
Subsidiary, the amount of Investments previously made (and treated as
a Restricted Payment) by the Company or any Restricted Subsidiary in
such Unrestricted Subsidiary.
(b) The provisions of Section 4.5(a) shall not prohibit:
(i) any purchase or redemption of Capital Stock of the Company or
Subordinated Obligations made in exchange for, or out of the proceeds of a
substantially concurrent sale of, Capital Stock of the Company (other than
Disqualified Stock and other than Capital Stock issued or sold to a
Subsidiary of the Company or an employee stock ownership plan or other
trust established by the Company or any of its Subsidiaries) or out of
proceeds of an equity contribution made substantially concurrently with
such purchase or redemption; provided, however, that (A) such purchase or
redemption shall be excluded in the calculation of the amount of Restricted
Payments and (B) the Net Cash Proceeds from such sale shall be excluded
from the calculation of amounts under Section 4.5(a)(3)(B);
37
(ii) any purchase or redemption of Subordinated Obligations made in
exchange for, or out of the proceeds of the substantially concurrent sale
of, Indebtedness of the Company which is permitted to be Incurred pursuant
to Section 4.3; provided, however, that (A) such Indebtedness is Incurred
in an aggregate principal amount (or if issued with original issue
discount, an aggregate issue price) that is equal to or less than the
aggregate sum of (1) the aggregate principal amount (or if issued with
original issue discount, the aggregate accreted value) then outstanding of
such Subordinated Obligations being so purchased or redeemed and (2) any
premiums, fees and other expenses paid by the Company or any Restricted
Subsidiary in connection with such purchase or redemption, (B) such
Indebtedness is at least as subordinated to the Securities as such
Subordinated Obligations so purchased or redeemed and the covenants
relating to such Indebtedness are no more restrictive in the aggregate than
those of such Subordinated Obligations, (C) such Indebtedness has a Stated
Maturity no earlier than the Stated Maturity of such Subordinated
Obligations, (D) such Indebtedness has an Average Life at the time such
Indebtedness is Incurred equal to or greater than the Average Life of such
Subordinated Obligations and (E) such purchase or redemption shall be
excluded in the calculation of the amount of Restricted Payments;
(iii) any payment in cash in lieu of the issuance of fractional
shares of Capital Stock to any Holder of Capital Stock warrants of the
Company outstanding on the Existing Notes Issue Date pursuant to the
exchange of such warrants for other Capital Stock of the Company upon the
exercise of such warrants pursuant to the terms thereof; provided, however,
that such payment shall be excluded in the calculation of the amount of
Restricted Payments;
(iv) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with Section 4.5(a); provided, however, that (A) at the time of payment of
such dividend, no other Default shall have occurred and be continuing (or
shall result therefrom) and (B) such dividend shall be included in the
calculation of the amount of Restricted Payments from and after the date of
declaration of such dividend; or
(v) so long as no Default or Event of Default shall have occurred and
be continuing or would occur as a consequence thereof, the redemption or
repurchase of Capital Stock of the Company, options in respect thereof or
related rights pursuant to and in accordance with the repurchase provisions
of any employee stock option or any stock purchase or other agreement
between the Company and any of its management employees; provided, however,
that such redemptions or repurchases pursuant to this Section 4.5(b)(v)
from and after the Existing Notes Issue Date shall not in the aggregate
exceed $1,000,000, plus the amount of any net cash proceeds to the Company
from sales of Capital Stock of the Company to management employees
subsequent to the Existing Notes Issue Date.
SECTION 4.6. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, create or otherwise cause
or permit to exist or become effective, any encumbrance
38
or restriction on the ability of any Restricted Subsidiary to (i) pay
dividends or make any other distributions on or in respect of its Capital
Stock to the Company or any Restricted Subsidiary or pay any Indebtedness
owed to the Company or any Restricted Subsidiary, (ii) make loans or advances
to the Company or (iii) transfer any of its property or assets to the Company
or any Restricted Subsidiary, except for:
(a) any encumbrance or restriction pursuant to an agreement in effect
at or entered into on the Issue Date;
(b) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary on or prior to the date on which such
Restricted Subsidiary became a Subsidiary of, or was acquired by, the
Company (other than Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to
which such Restricted Subsidiary became a Subsidiary of, or was acquired
by, the Company) and outstanding on such date;
(c) any encumbrance or restriction pursuant to an agreement relating
to an acquisition of property, so long as the encumbrances or restrictions
in such agreement relate solely to the property so acquired;
(d) any encumbrance or restriction pursuant to an agreement effecting
a refinancing of Indebtedness Incurred pursuant to an agreement referred to
in clause (a), (b) or (c) hereof or contained in any amendment to any such
agreement; provided, however, that any encumbrance and any restriction
contained in any such refinancing agreement or amendment is no less
favorable to the Securityholders than any encumbrance or restriction
contained in such agreement; and
(e) in the case of clause (iii), any encumbrance or restriction (1)
that restricts in a customary manner the subletting, assignment or transfer
of any property or asset that is a lease, license, conveyance or contract
or similar property or asset, (2) arising by virtue of any transfer of,
agreement to transfer, option or right with respect to, or Lien on, any
property or assets of the Company or any Restricted Subsidiary not
otherwise prohibited by this Indenture or (3) arising or agreed to in the
ordinary course of business and that does not, individually or in the
aggregate, detract from the value of property or assets of the Company or
any Restricted Subsidiary in any manner material to the Company or any such
Restricted Subsidiary.
SECTION 4.7. Limitation on Sales of Assets and Restricted Subsidiary
Stock. (a) The Company shall not, and shall not permit any Restricted
Subsidiary to, make any Asset Disposition (other than the Dispositions) unless
(i) the Company or such Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Disposition at least equal to the Fair
Market Value of the shares, property and assets subject to such Asset
Disposition, (ii) at least 75% of such consideration (or, in the event of any
Asset Disposition of all or any portion of the Company's Magnetics Division or a
Foreign Restricted Subsidiary, at least 50% of such
39
consideration) consists of cash, Temporary Cash Investments or the assumption
of Senior Indebtedness of the Company or any Restricted Subsidiary and the
release of the Company or such Restricted Subsidiary from all liability under
such Senior Indebtedness, (iii) in connection with any Asset Disposition with
an aggregate consideration greater than $10,000,000, the Company delivers an
Officers' Certificate to the Trustee certifying that such Asset Disposition
complies with clauses (i) and (ii) and that such Asset Disposition was
approved by a majority of the disinterested members of the Board of
Directors, as evidenced by a Board Resolution delivered to the Trustee and
(iv) 100% of the Net Cash Proceeds of such Asset Disposition are applied as
follows: (A) within 365 days after the receipt of any Net Cash Proceeds (the
last day of such period, the "Application Date"), the Company or Restricted
Subsidiary, as the case may be, may apply all or a portion of such Net Cash
Proceeds to prepay, repay, redeem or purchase Indebtedness of the Company
under the Existing Credit Facility or the Credit Facility or the reinvestment
(whether by acquisition of an existing business or expansion, including,
without limitation, capital expenditures) in one or more Permitted Lines of
Business, or any combination thereof, (B) to the extent any or all of such
Net Cash Proceeds are not applied as set forth above in clause (A), to
purchase Existing Notes tendered to the Company in connection with an offer
made to purchase such Existing Notes following an Asset Disposition, and (C)
to the extent any or all of such Net Cash Proceeds are not applied as set
forth in clause (A) and clause (B), the Company shall apply all remaining Net
Cash Proceeds of such Asset Disposition (the "Asset Disposition Purchase
Amount") to an offer to purchase (an "Asset Disposition Purchase Offer")
Securities, on the first Business Day occurring 60 Business Days after the
Application Date (the "Asset Disposition Purchase Date") for cash at a
purchase price (such price, the "Asset Disposition Purchase Price") equal to
100% of the principal amount of the Securities so purchased plus accrued and
unpaid interest thereon to the Asset Disposition Purchase Date, in accordance
with the procedures set forth in Section 4.7(c). Any such Net Cash Proceeds
which remain after the acquisition by the Company of Securities tendered (and
not withdrawn) by Securityholders pursuant to such Asset Disposition Purchase
Offer in accordance with the procedures (including proration in the event of
oversubscription) set forth in Section 4.7(c) shall cease to be Net Cash
Proceeds.
(b) Notwithstanding the foregoing, the Company shall not be
required to make an Asset Disposition Purchase Offer until such time as the
aggregate amount of Net Cash Proceeds from Asset Dispositions required to be
so applied to the purchase of Securities exceeds $10,000,000 (the "Asset
Disposition Trigger"), and then the total amount of such Net Cash Proceeds
shall be required to be applied to an Asset Disposition Offer.
(c) Within 30 Business Days of the occurrence of an Asset
Disposition Trigger, (i) the Company shall notify the Trustee in writing of
the occurrence of the Asset Disposition Trigger and shall make the Asset
Disposition Purchase Offer to purchase Securities in an aggregate principal
amount equal to the Asset Disposition Purchase Amount at the Asset
Disposition Purchase Price on or before the Asset Disposition Purchase Date,
(ii) the Company shall mail a copy of the Asset Disposition Purchase Offer to
each Securityholder and (iii) the Company shall cause a notice of the Asset
Disposition Purchase Offer to be sent to the Dow Xxxxx News Service or
similar business news service in the United States of America. The Asset
Disposition Purchase Offer shall remain open from the time such offer is made
until the Asset Disposition Purchase Date. The Company shall purchase all
Securities properly tendered
40
pursuant to the Asset Disposition Purchase offer and not withdrawn in
accordance with the procedures set forth in the Asset Disposition Purchase
Notice (as defined below). The Trustee shall be under no obligation to
ascertain, and the Trustee shall not be deemed to have knowledge of, the
occurrence of an Asset Disposition Trigger or to give notice with respect
thereto other than as provided above upon receipt of notice of the occurrence
of an Asset Disposition Trigger and an Asset Disposition Purchase Offer from
the Company. The Trustee may conclusively assume, in the absence of receipt
of notice of the occurrence of an Asset Disposition Trigger and an Asset
Disposition Purchase Offer from the Company, that no Asset Disposition
Trigger has occurred. The Asset Disposition Purchase Offer shall include a
form of Asset Disposition Purchase Notice to be completed by the
Securityholder and shall state or provide:
(1) the nature of the Asset Dispositions resulting in the Asset
Disposition Trigger, the date or dates such Asset Dispositions occurred and
the amount of the Asset Disposition Purchase Amount;
(2) that the Asset Disposition Purchase offer is being made pursuant
to this Section 4.7(c) and that Securities in an aggregate principal amount
equal to the Asset Disposition Purchase Amount, selected in accordance with
this Indenture (if more than such amount shall be tendered) on a pro rata
basis (with such adjustments as may be deemed appropriate by the Company so
that only Securities in Authorized Denominations shall be purchased) from
among all the Securities properly tendered pursuant to the Asset
Disposition Purchase Offer, will be accepted for payment;
(3) the date by which the Asset Disposition Purchase Notice pursuant
to this Section 4.7(c) must be given;
(4) the Asset Disposition Purchase Date;
(5) the Asset Disposition Purchase Price;
(6) the name and address of the Paying Agent;
(7) that Securities must be surrendered to the Paying Agent at the
office of the Paying Agent to collect payment;
(8) information concerning the business of the Company which the
Company in good faith believes will enable such Holders to make an informed
decision (which at a minimum shall include (i) the most recently filed
Annual Report on Form 10-K (including audited consolidated financial
statements) of the Company, the most recent subsequently filed Quarterly
Report on Form 10-Q and any Current Report on Form S-K of the Company filed
subsequent to such Quarterly Report, other than Current Reports describing
Asset Dispositions otherwise described in the offering materials (or
corresponding successor reports) and (ii) a description of material
developments in the Company's business subsequent to the date of the latest
of such Reports.
(9) that the Asset Disposition Purchase Price for any Security as to
which an Asset Disposition Purchase Notice has been duly given and not
withdrawn (subject to
41
proration if Securities with an aggregate principal amount greater than the
Asset Disposition Purchase Amount are so tendered) will be paid promptly
upon the later to occur of the third Business Day following the Asset
Disposition Purchase Date and the time of surrender of such Security as
described in clause (7);
(10) the procedures the Holder must follow to accept the Asset
Disposition Purchase Offer; and
(11) the procedures for withdrawing an Asset Disposition Purchase
Notice.
(d) A Holder may accept an Asset Disposition Purchase Offer by
delivering to the Paying Agent at the office of the Paying Agent a written
notice (an "Asset Disposition Purchase Notice") at any time prior to the
close of business in the location of the office of the Paying Agent on the
Asset Sale Purchase Date, stating:
(1) that such Holder elects to have a Security purchased pursuant to
the Asset Disposition Purchase Offer;
(2) the principal amount of the Security that the Holder elects to
have purchased by the Company, which amount must be in an Authorized
Denomination, and the certificate numbers of the Securities to be delivered
by such securityholder for purchase by the Company; and
(3) that such Security shall be purchased on the Asset Disposition
Purchase Date pursuant to the terms and conditions specified in this
Indenture.
The delivery of such Security (together with all necessary
endorsements, as determined by the Company) to the Paying Agent at the office
of the Paying Agent prior to, on or after the Asset Disposition Purchase Date
shall be a condition to the receipt by the Holder of the Asset Disposition
Purchase Price therefor; provided, that such Asset Disposition Purchase Price
shall be so paid pursuant to this Section 4.7(d) only if the Security so
delivered to the Paying Agent shall conform in all respects to the
description thereof set forth in the related Asset Disposition Purchase
Notice. If at the expiration of the Asset Disposition Purchase Offer the
aggregate principal amount of Securities surrendered by Holders exceeds the
Asset Disposition Purchase Amount, the Company or the Trustee shall select
the Securities to be purchased on a pro rata basis (with such adjustments as
may be deemed appropriate by the Company so that only Securities in
Authorized Denominations shall be purchased). Holders whose Securities are
purchased only in part will be issued new Securities equal in principal
amount to the unpurchased portion of the Securities surrendered.
The Company shall purchase from the Holder thereof, pursuant to an
Asset Disposition Purchase offer made in accordance with this Section 4.7, a
portion of a Security if the principal amount of such portion is an
Authorized Denomination. Provisions of this Indenture that apply to the
purchase of all of a Security also apply to the purchase of a portion of such
Security.
42
The Paying Agent shall promptly notify the Company of the receipt
by it of any Asset Disposition Purchase Notice or written notice of
withdrawal thereof.
Upon receipt by the Paying Agent of the Asset Disposition Purchase
Notice, the Holder of the Security in respect of which such Asset Disposition
Purchase Notice was given shall (unless such Asset Disposition Purchase
Notice is withdrawn as specified in the following paragraph) thereafter be
entitled to receive solely the Asset Disposition Purchase Price with respect
to such Security (subject to proration if Securities with an aggregate
principal amount greater than the Asset Disposition Purchase Amount are
properly tendered). Such Asset Disposition Purchase Price shall be paid to
such Securityholder by the Paying Agent promptly upon the later of (a) the
third Business Day following the Asset Disposition Purchase Date (provided
the conditions in this Section 4.7(d) have been satisfied) and (b) the first
Business Day following the time of delivery of the Security to the Paying
Agent at the office of the Paying Agent by the Holder thereof in the manner
required by this Section 4.7(d).
An Asset Disposition Purchase Notice may be withdrawn before or
after delivery by the Holder to the Paying Agent at the office of the Paying
Agent of the Security to which such Asset Disposition Purchase Notice
relates, by means of a written notice of withdrawal delivered by the Holder
to the Paying Agent at the office of the Paying Agent to which the related
Asset Disposition Purchase Notice was delivered at any time prior to the
close of business on the Asset Disposition Purchase Date specifying, as
applicable:
(1) the certificate number of the Security in respect of which such
notice of withdrawal is being submitted;
(2) the principal amount of the Security (which shall be an
Authorized Denomination) with respect to which such notice of withdrawal is
being submitted; and
(3) the principal amount, if any, of such Security (which shall be an
Authorized Denomination) that remains subject to the original Asset
Disposition Purchase Notice and that has been or will be delivered for
purchase by the Company.
No later than the date upon which written notice of an Asset
Disposition Purchase Offer is delivered to the Trustee, the Company shall
cause to be irrevocably deposited with the Paying Agent, subject to the
provisions of Section 2.4, in cash or Temporary Cash Investments an amount
sufficient to pay the aggregate Asset Disposition Purchase Price, to be held
for payment in accordance with the provisions of this Section.
(e) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant
to this Section. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company 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.
43
SECTION 4.8. Limitation on Transactions with Affiliates. (a)
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, conduct any business, enter into or permit to exist
any transaction (including, without limitation, the sale, conveyance,
disposition, purchase, exchange or lease of any property, the lending the
borrowing or advancing of any money or the rendering of any services) with,
or for the benefit of, any Affiliate of the Company (an "Affiliate
Transaction") unless (i) the terms of such Affiliate Transaction are in
writing, (ii) such Affiliate Transaction is in the best interest of the
Company or such Restricted Subsidiary, as the case may be, (iii) such
Affiliate Transaction is on terms as favorable to the Company or such
Restricted Subsidiary, as the case may be, as those that could be obtained at
the time of such Affiliate Transaction for a similar transaction in arm's
length dealings with a Person who is not such an Affiliate and (iv) with
respect to each Affiliate Transaction involving aggregate payments or value
in excess of $500,000, such Affiliate Transaction was approved by a majority
of the Board of Directors, including a majority of the disinterested members
of such Board, provided, however, that the foregoing does not prohibit (A)
any Restricted Payment permitted to be paid as described above under Section
4.5, (B) any issuance of securities or other payments, awards, or grants in
cash, securities or otherwise pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans approved by the Board
of Directors of the Company, (C) loans or advances permitted under this
Indenture to employees in the ordinary course of business in accordance with
past practices of the Company, (D) the payment of reasonable fees to
directors of the Company and its Restricted Subsidiaries who are not
employees of the Company or any Restricted Subsidiary, (E) any transaction
between the Company and a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries or (F) reasonable and customary indemnification arrangements
between the Company or any Restricted Subsidiary and their respective
directors and officers (to the extent that such indemnification arrangements
are permitted under applicable law).
SECTION 4.9. Change of Control. (a) Upon a Change of Control,
(i) the Company shall notify the Trustee, who shall in turn notify the
Holders, in writing of the occurrence of the Change of Control and shall make
an offer to purchase (the "Change of Control Offer") the Securities for cash
at a purchase price equal to 101% of the principal amount thereof plus any
accrued and unpaid interest thereon collectively the "Change of Control
Purchase Price") to the Change of Control Purchase Date (as defined below) on
or before the date specified in such notice, which date shall be no earlier
than 30 days and no later than 60 Business Days after the occurrence of the
Change of Control (the "Change of Control Purchase Date"), (ii) the Company
shall, or shall cause the Trustee to, mail a copy of the Change of Control
Offer to each Holder and (iii) the Company shall cause a notice of the Change
of Control Offer to be sent at least once to the Dow Xxxxx News Service and
The Bloomberg Business News Service or, if such news services no longer
publish such notices, a similar business news service in the United States.
The Change of Control Offer shall remain open from the time such offer is
made until the Change of Control Purchase Date The Company shall purchase all
Securities properly tendered in the Change of Control Offer and not withdrawn
in accordance with the procedures set forth in Section 4.9(b). The Trustee
shall be under no obligation to ascertain, and the Trustee shall not be
deemed to have knowledge of, the occurrence of a Change of
44
Control or to give notice with respect thereto other than as provided above
upon receipt of a Change of Control Offer from the Company. The Trustee may
conclusively assume, in the absence of receipt of a Change of Control Offer
from the Company, that no Change of Control has occurred. The Change of
Control Offer shall include a form of change of control purchase notice (the
"Change of Control Purchase Notice") to be completed by the Holder and shall
state:
(1) the events causing a Change of Control and the date such Change
of Control is deemed to have occurred;
(2) the circumstances and relevant facts regarding such Change of
Control which the Company in good faith believes will enable Holders to
make an informed decision (which at a minimum will include (i) the most
recently filed Annual Report on Form 10-K (including audited financial
statements) of the Company, the most recent subsequently filed Quarterly
Report on Form 10-Q and any Current Report on Form 8-K of the Company filed
subsequent to such Quarterly Report, (ii) a description of material
business developments in the Company's business subsequent to the date of
the latest of such Reports and (iii) information with respect to pro forma
historical income, cash flow and capitalization, each after giving effect
to such Change of Control, events causing such Change of Control and the
date such Change of Control is deemed to have occurred);
(3) that the Change of Control Offer is being made pursuant to this
Section 4.9(a) and that all Securities properly tendered pursuant to the
Change of Control Offer will be accepted for payment;
(4) the date by which the Change of Control Purchase Notice pursuant
to this Section 4.9 must be given;
(5) the Change of Control Purchase Date;
(6) the Change of Control Purchase Price;
(7) the name and address of the Paying Agent;
(8) that Securities must be surrendered to the Paying Agent at the
office of the Paying Agent to collect payment;
(9) that the Change of Control Purchase Price for any Security as to
which a Change of Control Purchase Notice has been duly given and not
withdrawn will be paid promptly upon the later of the first Business Day
following the Change of Control Purchase Date and the time of surrender of
such Security as described in clause (8);
(10) the procedure the Securityholder must follow to accept the Change
of Control Offer; and
(11) the procedures for withdrawing a Change of Control Purchase
Notice.
(b) A Securityholder may accept a Change of Control Offer by
delivering to the Paying Agent at the office of the Paying Agent a Change of
Control Purchase Notice at any
45
time prior to the close of business in the location of the office of the
Paying Agent on the Change of Control Purchase Date, stating:
(1) that such Securityholder elects to have a Security purchased
pursuant to the Change of Control Offer;
(2) the principal amount of the Security that the Securityholder
elects to have purchased by the Company, which amount must be an Authorized
Denomination, and the certificate numbers of the Securities to be delivered
by such Securityholder for purchase by the Company; and
(3) that such Security shall be purchased on the Change of Control
Purchase Date pursuant to the terms and conditions specified in this
Indenture.
The delivery of such Security (together with all necessary
endorsements) to the Paying Agent at the office of the Paying Agent prior to,
on or after the Change of Control Purchase Date shall be a condition to the
receipt by the Securityholder of the Change of Control Purchase Price
therefor; provided, that such Change of Control Purchase Price shall be so
paid pursuant to this Section only if the Security so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in
the related Change of Control Purchase Notice. Securityholders whose
Securities are purchased only in part will be issued new Securities equal in
principal amount to be unpurchased portion of the Securities surrendered.
The Company shall purchase from the Holder thereof, pursuant to
this Section, a portion of a Security if the principal amount of such portion
is an Authorized Denomination. Provisions of this Indenture that apply to
the Purchase of all of a Security also apply to the Purchase of a portion of
such Security.
The Paying Agent shall promptly notify the Company of the receipt
by it of any Change of Control Purchase Notice or written notice of
withdrawal thereof.
Upon receipt by the Company of the Change of Control Purchase
Notice, the Holder of the Security in respect of which such Change of Control
Purchase Notice was given shall (unless such Change of Control Purchase
Notice is withdrawn as specified in the following paragraph) thereafter be
entitled to receive solely the Change of Control Purchase Price with respect
to such Security. Such Change of Control Purchase Price shall be paid to
such Holder promptly upon the later of (a) the first Business Day following
the Change of Control Purchase Date (provided the conditions in this Section
4.9(b) have been satisfied) and (b) the first Business Day following the time
of delivery of the Security to the Paying Agent at the office of the Paying
Agent by the Holder thereof in the manner required by this Section 4.9(b).
A Change of Control Purchase Notice may be withdrawn before or
after delivery by the Holder to the Paying Agent at the office of the Paying
Agent of the Security to which such Change of Control Purchase Notice
relates, by means of a written notice of withdrawal delivered by the Holder
to the Paying Agent at the office of the Paying Agent to which the related
Change
46
of Control Purchase Notice was delivered at any time prior to the close of
business on the Change of Control Purchase Date specifying, as applicable:
(1) the certificate number of the Security in respect of which such
notice of withdrawal is being submitted;
(2) the principal amount of the Security (which shall be an
Authorized Denomination) with respect to which such notice of withdrawal is
being submitted; and
(3) the principal amount, if any, of such security (which shall be an
Authorized Denomination) that remains subject to the original Change of
Control Purchase Notice and that has been or will be delivered for purchase
by the Company.
No later than the date upon which the Change of Control Offer is
delivered to the Trustee, the Company shall irrevocably deposit with the
Paying Agent, subject to the provisions of Section 2.4, in cash or Temporary
Cash Investments an amount equal to the Change of Control Purchase Price to
the Holders entitled thereto, to be held for payment in accordance with the
provisions of this Section.
(c) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company 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.
SECTION 4.10. Compliance Certificate. The Company shall deliver
to the Trustee within 120 days after the end of each fiscal year of the
Company an Officers' Certificate stating that in the course of the
performance by the signers of their duties as Officers of the Company they
would normally have knowledge of any Default 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
Company is taking or proposes to take with respect thereto. The Company also
shall comply with TIA Section 314(a)(4).
SECTION 4.11. Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.12. Limitation on Liens. The Company shall not, and
shall not permit any Restricted Subsidiary to, directly or indirectly, create
or permit to exist any Lien (other than Permitted Liens) on any of its
property or assets (including Capital Stock), whether owned on the Issue Date
or thereafter acquired, or any right, title or interest thereto, unless the
Company or such Restricted Subsidiary shall secure all payments hereunder and
under the Securities on an equal and ratable basis with the obligation so
secured until such time as such obligation is no longer secured by a Lien.
47
SECTION 4.13. Limitation on Sale/Leaseback Transactions. The
Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, enter into, Guarantee or otherwise become liable with
respect to any Sale/Leaseback Transaction with respect to any property or
assets unless (i) the Company or such Restricted Subsidiary, as the case may
be, would be entitled to Incur Indebtedness secured by a Permitted Lien on
such property or assets in an amount equal to the Attributable Indebtedness
with respect to such Sale/Leaseback Transaction, (ii) the Net Cash Proceeds
from such Sale/Leaseback Transaction are at least equal to the Fair Market
Value of the property or assets subject to such Sale/Leaseback Transaction
(such Fair Market Value determined, in the event such property or assets have
a Fair Market Value in excess of $2,000,000, no more than 30 days prior to
the effective date of such Sale/Leaseback Transaction, by such Board of
Directors including a majority of the disinterested members of such Board of
Directors, as evidenced by a Board Resolution of such Board), and (iii) the
net cash proceeds of such Sale/Leaseback Transaction are applied in
accordance with Section 4.7.
SECTION 4.14. Limitation on Issuance and Sale of Capital Stock of
Restricted Subsidiaries. The Company shall not permit (i) any Restricted
Subsidiary to issue any Capital Stock other than to the Company or a Wholly
Owned Subsidiary; or (ii) any Person (other than the Company or a Wholly
Owned Subsidiary) to, directly or indirectly, own or control any Capital
Stock of any Restricted Subsidiary (other than directors' qualifying shares);
provided, however, that clauses (i) and (ii) shall not prohibit (a) any sale
of 100% of the shares of the Capital Stock of any Restricted Subsidiary owned
by the Company or any Wholly Owned Subsidiary effected in accordance with
Section 4.7, or (b) any issuance of Preferred Stock of a Restricted
Subsidiary to any Person permitted under Section 4.4.
SECTION 4.15. Restricted and Unrestricted Subsidiaries. (a) The
Board of Directors may designate any Subsidiary of the Company or any
Restricted Subsidiary to be an Unrestricted Subsidiary if (i) the Subsidiary
to be so designated does not own any Capital Stock, Redeemable Stock or
Indebtedness of, or own or hold any Lien on any property or assets of, the
Company or any other Restricted Subsidiary, (ii) the Subsidiary to be so
designated is not obligated by any Indebtedness or Lien that, if in default,
would result (with the passage of time or notice or otherwise) in a default
on any Indebtedness of the Company or any Restricted Subsidiary, and (iii)
either (A) the Subsidiary to be so designated has total assets of $1,000 or
less or (B) such designation is effective immediately upon such Person
becoming a Subsidiary of the Company or of a Restricted Subsidiary. Unless so
designated as an Unrestricted Subsidiary, any Person that becomes a
Subsidiary of the Company or any Restricted Subsidiary shall be classified as
a Restricted Subsidiary. Except as provided in the first sentence of this
paragraph (a), no Restricted Subsidiary shall be redesignated as an
Unrestricted Subsidiary. Subject to Section 4.15(b), an Unrestricted
Subsidiary shall not be redesignated as a Restricted Subsidiary. Any such
designation by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the Board Resolution giving effect
to such designation and an Officers' Certificate certifying that such
designation complies with the foregoing provisions.
(b) The Company shall not, and shall not permit any Restricted
Subsidiary to, take any action or enter into any transaction or series of
transactions that would result in a Person becoming a Restricted Subsidiary
(whether through an acquisition, the redesignation of an
48
Unrestricted Subsidiary or otherwise) unless after giving effect to such
action, transaction or series of transactions, on a pro forma basis, (i) the
Company could incur at least $1.00 of additional Indebtedness pursuant to
Section 4.3(a)(i), (ii) such Restricted Subsidiary could then Incur under
Section 4.4 all Indebtedness as to which it is obligated at such time, (iii)
no Default or Event of Default would occur or be continuing and (iv) there
exist no Liens with respect to the property or assets of such Restricted
Subsidiary other than Permitted Liens.
SECTION 4.16. Revisions to Schedules. Schedule III shall be
revised from time to time by the Company to accurately reflect all the U.S.
Restricted Subsidiaries, whether now existing or hereafter created, formed,
designated or acquired, and upon such revision a new Schedule III shall be
delivered to the Trustee.
SECTION 4.17. Maintenance of Properties; Insurance. The Company
shall, and shall cause each Restricted Subsidiary to, at all times:
(a) maintain all property and assets necessary in its business in
good working order and condition (ordinary wear and tear excepted), in
compliance with applicable regulations, laws or restrictions and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be necessary so its business may be properly and
advantageously conducted at all times; and
(b) maintain with recognized national or international insurance
companies, or through self-insurance programs, insurance on such of its
property and assets, and against such liabilities in at least such amounts,
against at least such risks and with such deductibles or self-insured
retentions as in each case are customarily insured against in the same
general area by companies engaged in the same or a similar business and
consistent with the past practices of the Company, and furnish to the Trustee
an Officers' Certificate specifying the nature of the insurance carried and
adequacy thereof at such times as it shall deliver to the Trustee an
Officers' Certificate pursuant to Section 4.10.
SECTION 4.18. Corporate Existence. Subject to Article 5, the
Company shall do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence and the corporate,
partnership or other existence of each of its Subsidiaries, in accordance
with the respective organizational documents of the Company and each such
Subsidiary and the rights (charter and statutory), registrations, licenses
and franchises of the Company and such Subsidiaries; provided, however, that
the Company shall not be required to preserve any such right, license,
registration or franchise, or the corporate, partnership or other existence
of any such Subsidiary, if the preservation thereof is no longer desirable in
the conduct of the business of the Company and its Subsidiaries taken as a
whole, and the loss thereof is not adverse in any material respect to the
Holders; provided. further, however, that if such Subsidiary has more than a
de minimis amount of assets, the Board of Directors shall be required to make
a determination to the foregoing effect.
SECTION 4.19. Taxes. The Company shall, and shall cause each of
its Subsidiaries to, pay, prior to delinquency, all taxes, assessments and
governmental levies, except
49
as the same are being contested in good faith and by appropriate proceedings
or where the failure to pay would not have a material adverse effect on the
Company and its Subsidiaries taken as a whole.
SECTION 4.20. Conflicting Agreements. The Company shall not, and
shall not permit any of its Subsidiaries to, enter into any agreement or
instrument, other than any agreement governing Senior Indebtedness, that by
its terms expressly (i) prohibits the Company from making any payments on the
Securities required by the terms hereof and thereof or (ii) making any Asset
Disposition Purchase Offer or Change of Control Offer, pursuant to Section
4.7 or 4.9, respectively.
SECTION 4.21. Limitation on Layering. The Company shall not and
shall not permit any of its Restricted Subsidiaries to incur or suffer to
exist any Indebtedness if such Indebtedness is expressly subordinate or
junior in right of payment to any Senior Indebtedness and senior in right of
payment to the Securities.
ARTICLE 5
Merger, Consolidation or Sale of Assets
The Company shall not, and the Company shall not permit any
Restricted Subsidiary to, enter into any transaction or series of
transactions to consolidate, amalgamate or merge with or into any other
Person (other than the merger of a Wholly Owned Subsidiary (i) with another
Wholly Owned Subsidiary or (ii) into the Company), or directly or indirectly
through its Subsidiaries sell, convey, assign, transfer, lease or otherwise
dispose of all or substantially all its property and assets to any Person or
group of affiliated Persons (other than to one or more Wholly Owned
Subsidiaries or to the Company) unless (i) if the Company is a party to such
transaction and is not the surviving entity (the "Surviving Entity"), the
Surviving Entity formed by such consolidation or amalgamation or into which
the Company is merged or that acquires, by sale, conveyance, assignment,
transfer, lease or other disposition, all or substantially all the properties
and assets of the Company as an entirety, shall be a corporation organized
and validly existing under the laws of the United States or any State thereof
or the District or Columbia and shall expressly assume (a) by a supplemental
indenture executed and delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Company pursuant to the Securities and
the Indenture and (b) by written instruments executed and delivered to the
Trustee, in form satisfactory to the Trustee, all the obligations of the
Company under any agreements entered into by the company to effectuate the
provisions of Section 4.12 hereof; (ii) the Surviving Entity, if any
Restricted Subsidiary is a party to such transaction and is not the Surviving
Entity, shall by written instruments executed and delivered to the Trustee,
in form satisfactory to the Trustee, expressly assume all the obligations of
such Restricted Subsidiary under any agreements entered into by such
Restricted Subsidiary to effectuate the terms of Section 4.12 hereof; (iii)
immediately before and after giving effect to such transaction or series of
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the Company, the Surviving Entity or any Restricted
Subsidiary as a result of such transaction or series of transactions as
having been incurred by the Company, such Surviving Entity or such Restricted
Subsidiary at the time of such transaction or series of transactions) no
Default or Event of Default shall have occurred and be
50
continuing; (iv) immediately after giving effect to such transaction or
series of transactions on a pro forma basis (and treating any Indebtedness
which becomes an obligation of the Company, the Surviving Entity or any
Restricted Subsidiary as a result of such transaction or series of
transactions as having been incurred by the Company, such Surviving Entity or
such Restricted Subsidiary at the time of such transaction or series of
transactions), the Company or the Surviving Entity, as the case may be, could
incur at least $1.00 of additional Indebtedness pursuant to Section
4.3(a)(i); (v) immediately after giving effect to such transaction or series
of transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the Company, the Surviving Entity or any Restricted
Subsidiary as a result of such transaction or series of transactions as
having been incurred by the Company, such Surviving Entity or such Restricted
Subsidiary at the time of such transaction or series of transactions), the
Company or the Surviving Entity, as the case may be, shall have a
Consolidated Tangible Net Worth which is not less than the Consolidated
Tangible Net Worth of the Company immediately prior to such transaction or
transactions; and (vi) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating (A) that such
consolidation, amalgamation, merger or transfer and such supplemental
indenture (if any) and written instrument (if any) comply with this Indenture
and (B) that upon execution and delivery of such supplemental indenture or
written instrument the Company or such Surviving Entity shall be bound by the
terms of this Indenture as thereby amended and this Indenture as thereby
amended shall be enforceable against the Company or such Surviving Entity in
accordance with its terms.
Upon any transaction involving the Company in which the Company is
not the Surviving Entity, such Surviving Entity shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture, but the Company in the case of a transfer or lease shall not
be released from the obligation to pay the principal of, and premium, if any,
or interest on, the Securities.
ARTICLE 6
Defaults and Remedies
SECTION 6.1. Events of Default. An "Event of Default" occurs if:
(1) the Company fails to make any payment of interest on any Security
when the same shall become due and payable, and such failure continues for
a period of 30 days;
(2) the Company (i) fails to make the payment of the principal of or
premium, if any, on any Security when the same becomes due and payable at
its Stated Maturity, upon acceleration, redemption or declaration, or
otherwise or (ii) fails to redeem or purchase Securities when and to the
extent required pursuant to this Indenture or the Securities;
(3) the Company fails to comply with Article 5;
(4) the Company fails to comply with Section 4.2, 4.3, 4.4, 4.5, 4.6,
4.7. 4.8, 4.9, 4.12, 4.13, 4.14, 4.20 or 4.21 (other than a failure to
purchase Securities when
51
required under Section 4.7 or 4.9) and such failure continues for 30 days
after the notice specified below, or the Company fails to give the notice
specified below;
(5) the Company fails to comply with any of its agreements in the
Securities or this Indenture (other than those referred to in (1), (2), (3)
or (4) above) and such failure continues for a period of 60 days after the
notice specified below or the Company fails to give the notice specified
below;
(6) principal of or interest on any Indebtedness of the Company or
any Restricted Subsidiary for borrowed money is not paid when due within
any applicable grace period or any Indebtedness of the Company or any
Restricted Subsidiary is accelerated by the Holders thereof, in each case,
if the total amount so unpaid when due within any applicable grace period
or accelerated exceeds $7,500,000 or its Dollar Equivalent at the time;
(7) one or more judgments or decrees aggregating in excess of
$7,500,000 or its Dollar Equivalent at the time is rendered against the
Company or any Restricted Subsidiary and is not discharged and either: (A)
an enforcement proceeding has been commenced by any creditor upon such
judgment or decree; or (B) there is a period of 60 days following the entry
of such judgment or decree during which such judgment or decree is not
discharged, waived or the execution thereof stayed;
(8) the Company or any Restricted Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case;
(C) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(D) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(9) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Restricted
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any Restricted
Subsidiary or for any substantial part of its property; or
52
(C) orders the winding up or liquidation of the Company or any
Restricted Subsidiary;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 60 days.
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by reason of the provisions of Article IX of this Indenture or 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 Title 11, United States 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.
A Default under clause (4) or (5) above is not an Event of Default
until the Trustee or the Holders of at least 25% in principal amount of the
Securities notify the Company of the Default and the Company does not cure such
Default within the time specified after receipt of such notice. Such notice
must specify the Default, demand that it be remedied and state that such notice
is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which with the giving of notice and the lapse of time would become an
Event of Default under clause (4), (5), (6) or (7) above, its status and what
action the Company is taking or proposes to take with respect thereto.
SECTION 6.2. Acceleration. If an Event of Default (other than an
Event of Default specified in Section 6.1(8) or (9) with respect to the Company)
occurs and is continuing, the Trustee by notice to the Company, or the Holders
of at least 25% in principal amount of the Securities by notice to the Trustee
(who shall promptly notify the Company), may declare the principal of and
accrued interest on all the Securities to be due and payable. Upon such a
declaration, such principal and interest shall be due and payable immediately.
If an Event of Default specified in Section 6.1(8) or (9) occurs, the principal
of and interest on all the Securities shall ipso facto become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Securityholders. The Holders of a majority in principal amount of the
Securities by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.3. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
53
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.4. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default or Event of Default and its consequences except (i) a Default
or Event of Default in the payment of the principal (other than principal due by
reason of acceleration) of or interest on a Security or (ii) a Default in
respect of a provision that under Section 9.2 cannot be amended or waived
without the consent of each Securityholder affected. When a Default or Event of
Default is waived, it is deemed cured, but no such waiver shall extend to any
subsequent or other Default or impair any consequent right.
SECTION 6.5. Control by Majority. The Holders of a majority in
principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or by
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 7.1, that the Trustee determines is unduly prejudicial to the
rights of other Securityholders or would involve the Trustee in personal
liability; provided, however, that the Trustee may take any other action deemed
proper by the Trustee that is not inconsistent with such direction. Prior to
taking any action hereunder, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
SECTION 6.6. Limitation on Suits. A Securityholder may not pursue
any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in principal amount of the Securities
make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee security or indemnity
reasonably satisfactory to it against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority in principal amount of the Securities
do not give the Trustee a direction inconsistent with the request during
such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
54
SECTION 6.7. Rights of Holders To Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on the Securities held by such Holder, on
or after the respective due dates expressed in the Securities, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.
SECTION 6.8. Collection Suit by Trustee. If an Event of Default in
payment of interest or principal specified in Section 6.1(1) or (2) occurs and
is continuing, the Trustee may recover judgment in its own name and as trustee
of an express trust against the Company for the whole amount of principal and
interest remaining unpaid (together with interest on such unpaid interest to the
extent lawful) and the amounts provided for in Section 7.7.
SECTION 6.9. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee and the
Securityholders allowed in any judicial proceedings relative to the Company,
its creditors or its property and, unless prohibited by law or applicable
regulations, may vote on behalf of the Holders in any election of a trustee
in bankruptcy or other Person performing similar functions, and any Custodian
in any such judicial proceeding is hereby authorized by each Holder to make
payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the Trustee
any amount due it for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and its counsel, and any other
amounts due the Trustee under Section 7.7.
SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article 6, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for principal and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section. At least 15 days before such record
date, the Company shall mail to each Securityholder and the Trustee a notice
that states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This
55
Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.7 or a suit by Holders of more than 10% in principal amount of the
Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. The Company (to the
extent it may lawfully refrain from doing 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 Company (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.
ARTICLE 7
Trustee
SECTION 7.1. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Xxxxxx's own affairs.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations or other
facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that: (1) this paragraph does not limit the effect of
paragraph (b) of this Section; (2) the Trustee shall not be liable for any error
of judgment made in good faith by a Trust Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and (3) the Trustee
shall not be liable with respect to any action it takes or omits to take in good
faith in accordance with a direction received by it pursuant to Section 6.5.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
56
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 7.2. Rights of Trustee. (a) The Trustee may rely and shall
be protected in acting or in refraining from acting 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, 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, upon
reasonable notice to the Company, to examine the books, records and premises of
the Company, personally or by agent or attorney and to consult with the officers
and representatives of the Company, including the Company's accountants and
attorneys.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, or both. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on 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, and the advice or opinion
of counsel with respect to legal matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee
57
security or indemnity reasonably satisfactory to it against the costs, expenses
and liabilities which may be incurred by it in compliance with such request,
order or direction.
SECTION 7.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.4. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in the Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.5. Notice of Defaults. If a Default occurs and is
continuing and if it is known to a Trust Officer of the Trustee, the Trustee
shall mail to each Securityholder notice of the Default within 90 days after it
occurs. Except in the case of a Default in payment of principal of or interest
on any Security (including payments pursuant to the mandatory redemption
provisions of such Security, if any), 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 Securityholders.
SECTION 7.6. Reports by Trustee to Holders. If required by TIA
Section 313(a), as promptly as practicable after each May 15 beginning with the
May 15 following the date of this Indenture, and in any event prior to July 15
in each year, the Trustee shall mail to each Securityholder a brief report dated
as of May 15 that complies with TIA Section 313(a). The Trustee also shall
comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange (if any) on which the
Securities are listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange and of any delisting
thereof.
SECTION 7.7. Compensation and Indemnity. The Company shall pay to
the Trustee from time to time such compensation as shall be agreed to in writing
between the Company and the Trustee for its services. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company shall reimburse the Trustee upon request for all
reasonable out-of-pocket expenses incurred or made by it, including costs of
collection, sale or otherwise in connection with this Indenture, 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 and court costs. The Company shall indemnify
the Trustee, its officers, directors, employees and agents, against any and all
loss, liability damage, claim or expense (including reasonable attorneys' fees
and expenses), including taxes (other than taxes based on the income of the
Trustee) incurred by
58
it in connection with the acceptance or administration of this trust and the
performance of its duties hereunder. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee
to so notify the Company shall not relieve the Company of its obligations
hereunder. The Company shall defend the claim and the Trustee may have separate
counsel and the Company shall pay the fees and expenses of such counsel. The
Company need not reimburse any expense or indemnify against any loss, liability
or expense incurred by the Trustee through the Trustee's own willful misconduct,
negligence or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities. The Trustee's right to
receive payment of any amounts due under this Section 7.7 shall not be
subordinate to any other liability or indebtedness of the Company (even though
the Securities may be subordinate to such other liability or indebtedness).
The Company's payment obligations pursuant to this Section and the
Lien of the Trustee referred to in the preceding paragraph shall survive the
discharge of this Indenture. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.1(8) or (9) with respect to the
Company, the expenses are intended to constitute expenses of administration
under Bankruptcy Law.
SECTION 7.8. Replacement of Trustee. The Trustee may resign at any
time by so notifying the Company. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the Trustee and may
appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders of
a majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.7.
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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
25% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.7 shall continue for the
benefit of the retiring Trustee.
SECTION 7.9. Successor Trustee by Xxxxxx. 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 or banking
association without any further act shall be the successor Trustee.
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at
all times satisfy the requirements of TIA Section 310(a). The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition. No obligor upon the
Securities or Person directly controlling, controlled by or under common control
with such obligor shall serve as Trustee upon the Securities. The Trustee shall
comply with TIA Section 310(b); provided, however, that there shall be excluded
from the operation of TIA Section 310(b) (1) any indenture or indentures under
which other securities or certificates of interest or participation in other
securities of the Company are outstanding if the requirements for such exclusion
set forth in TIA Section 310(b) (1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE 8
Discharge of Indenture; Defeasance
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SECTION 8.1. Discharge of Liability on Securities; Defeasance. (a)
When (i) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.9) for cancellation or (ii) all
outstanding Securities have become due and payable, whether at maturity or as a
result of the mailing of a notice of redemption pursuant to Article 3 hereof,
and the Company irrevocably deposits with the Trustee funds sufficient to pay at
maturity or upon redemption all outstanding Securities, including interest
thereon (other than Securities replaced pursuant to Section 2.9), and if in
either case the Company pays all other sums payable hereunder by the Company,
then this Indenture shall, subject to Sections 8.1(c) and 8.6, cease to be of
further effect. The Trustee shall acknowledge satisfaction and discharge of
this Indenture on demand of the Company accompanied by an Officers' Certificate
and an Opinion of Counsel and at the cost and expense of the Company.
(b) Subject to Sections 8.1(c), 8.2 and 8.6, the Company at any time
may terminate (i) all its obligations under the Securities and this Indenture
("legal defeasance option") or (ii) its obligations under Sections 4.2 (to the
extent that the failure to comply with Section 4.2 shall not violate the TIA),
4.3, 4.4, 4.5, 4.6, 4.7, 4.8, 4.9, 4.12, 4.13, 4.14, 4.21 and 4.22, Article 5
and the related operation of Sections 6.1(3), (4) and (5) and the operation with
respect to Restricted Subsidiaries of Sections 6.1(6), (7), (8) and (9)
("covenant defeasance option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the
Company exercises its covenant defeasance option, payment of the Securities may
not be accelerated because of an Event of Default specified in Sections 6.1(3),
(4) or (5) or an Event of Default with respect to a Restricted Subsidiary
specified in Sections 6.1(b), (7), (8) or (9).
Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b), the Company's obligations in
Sections 2.3, 2.4, 2.5, 2.6, 2.9, 7.7, 7.8, 8.4, 8.5 and 8.6 shall survive until
the Securities have been paid in full. Thereafter, the Company's obligations in
Sections 7.7, 8.4, 8.5 and 8.6 shall survive.
SECTION 8.2. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee money
or U.S. Government Obligations for the payment of principal and interest on
the Securities to maturity or redemption, as the case may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash
61
at such times and in such amounts as will be sufficient to pay principal
and interest when due on all the Securities to maturity or redemption, as
the case may be;
(3) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Section 6.1(8) or (9) with respect to the
Company occurs which is continuing at the end of the period;
(4) no Default has occurred and is continuing on the date of such
deposit and after giving effect thereto;
(5) the deposit does not constitute a default under any other
agreement binding on the Company;
(6) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment Company
Act of 1940;
(7) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (i) the
Company has received from the Internal Revenue Service a ruling or (ii)
since the date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Securityholders
will not recognize income, gain or loss for Federal income tax purposes as
a result of such defeasance and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such defeasance had not occurred;
(8) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Securityholders will not recognize income, gain or loss for Federal income
tax purposes as a result of such covenant defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred; and
(9) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent to the
defeasance and discharge of the Securities as contemplated by this Article
8 have been complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.
SECTION 8.3. Application of Trust Money. The Trustee shall hold in
trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S.
Government obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal of and interest on the Securities.
62
SECTION 8.4. Repayment to Company. The Trustee and the Paying Agent
shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon written request any money held by
them for the payment of principal or interest that remains unclaimed for two
years; provided, however, that the Trustee and the Paying Agent before being
required to make any payment may, but need not, at the expense of the Company
cause to be published once in a newspaper of general circulation in the City of
New York or mail to each Holder entitled to such money notice that such money
remains unclaimed and that after a date specified therein, which shall be at
least 30 days from the date of such publication or mailing, any unclaimed
balance of such money then remaining will be paid to the Company. After payment
to the Company, Securityholders entitled to the money must look to the Company
for payment as general creditors.
SECTION 8.5. Indemnity for Government Obligations. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against deposited U.S. Government Obligations or the principal
and interest received on such U.S. Government Obligations.
SECTION 8.6. Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article 8.
ARTICLE 9
Subordination
SECTION 9.1. Securities Subordinated to Senior Indebtedness. The
Company, for itself and its successors, and each Holder, by its acceptance of
Securities, agrees that, notwithstanding anything to the contrary in Sections
6.1 and 6.2 hereof, the payment of the principal of, interest on or any other
amounts due on the Securities is subordinated in right of payment, to the extent
and in the manner provided in this Article 9, to the prior payment in full of
all Senior Indebtedness. Each Holder by its acceptance of the Securities
authorizes and directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of Senior
Indebtedness and such Holder, the subordination provided in this Article 9.
The expressions "prior payment in full," "payment in full" and "paid
in full" and any other similar term or phrase when used in this Article 9 with
respect to Senior Indebtedness
63
shall mean the payment in full of such Senior Indebtedness in cash or provision
for such payment in cash or otherwise in a manner satisfactory to the holders of
the Senior Indebtedness.
This Article 9 shall constitute a continuing offer to all persons who,
in reliance upon such provisions, become holders of, or continue to hold, Senior
Indebtedness, and such provisions are made for the benefit of the holders of
Senior Indebtedness, and such holders are made obligees hereunder and they
and/or each of them may enforce such provisions to the extent and in the manner
provided herein.
SECTION 9.2. No Payment on Securities in Certain Circumstances. (a)
No direct or indirect payment (in cash, property, securities, by set-off or
otherwise) shall be made or agreed to be made on account of the principal of,
premium (if any) or interest on the Securities, or in respect of any redemption,
retirement, defeasance, purchase or other acquisition of any of the Securities,
and no Holder of any Security shall be entitled to receive any such payment (any
of the foregoing payments or actions being referred to in this Section 9.2 as a
"Payment"), on or after the occurrence of any default in the payment of
principal or interest then due and payable in respect of any Senior Indebtedness
(either at maturity, upon redemption, by acceleration or otherwise), unless and
until such default has been waived or cured or all amounts then due and payable
for principal of and interest on all Senior Indebtedness shall have been paid in
full or provision therefor in cash, in cash equivalents, or in accordance with
the terms of such Senior Indebtedness and the agreements, if any, under which
such Senior Indebtedness was issued or created, shall have been made.
(b) The Company may not make any Payment if:
(i) a default or event of default under any agreement governing
Senior Indebtedness (other than a default or event of default relating to
payment of principal or interest, either at maturity, upon redemption, by
declaration or otherwise) has occurred and is continuing that permits the
holders of such Senior Indebtedness to accelerate its maturity (whether or
not such acceleration has occurred); and
(ii) the Company or the Trustee receives a notice of such default or
event of default from (A) the holders of a majority of the outstanding
principal amount of such Senior Indebtedness or (B) the trustee or agent,
if any, representing the holders in respect of such Senior Indebtedness;
provided, however, that only one such notice shall be given effect within
any period of 360 consecutive days; provided, further, that no more than
one notice may be given with respect to any continuing default or event of
default.
Notwithstanding the provisions of this Section 9.2(b), the Company may make
Payments on the Securities when:
(1) all defaults and events of default referred to in such notice are
cured or waived; or
(2) 179 days pass after such notice is given, with respect to such
defaults and/or events of default
64
so long as this Article 9 (including, without limitation, Section 9.2(a))
otherwise permits a Payment at that time.
(c) In the event that notwithstanding the provisions of this Section
9.2 the Company shall make any Payment to the Trustee or any Holder of the
Securities on account of the principal of or interest on the Securities after
receiving notice (as aforesaid) of the happening of a default or event of
default on Senior Indebtedness, then, unless and until such default or event of
default shall have been cured or waived or shall have ceased to exist either due
to the passage of time as aforesaid in Section 9.2(b)(ii)(2) or otherwise, such
payment (subject to the provisions of Sections 9.6 and 9.7) shall be held by the
Trustee or such Holder, in trust for the benefit of, and subject to Sections 9.6
and 9.7, shall be paid forthwith over and delivered to, the holders of Senior
Indebtedness (pro rata as to each of such holders on the basis of the respective
amounts of Senior Indebtedness then in default held by them), as their
respective interests may appear, for application to the payment of all Senior
Indebtedness remaining unpaid to the extent necessary to pay all Senior
Indebtedness in full in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Indebtedness.
The Company shall give prompt written notice to the Trustee of any
default in the payment of principal of or interest on any Senior Indebtedness or
a default which results in the acceleration of such Senior Indebtedness under
the Credit Facility or under any agreement pursuant to which Senior Indebtedness
has been issued.
SECTION 9.3. Securities Subordinated to Prior Payment of All Senior
Indebtedness on Dissolution, Liquidation or Reorganization of Company. Upon any
distribution or payment of assets or securities of the Company upon any
dissolution, winding up, liquidation or reorganization of the Company of any
kind or character (whether voluntary or involuntary, in bankruptcy, insolvency
or receivership proceedings or upon an assignment for the benefit of creditors
or otherwise):
(a) the holders of all Senior Indebtedness shall first be entitled to
receive payment in full (or to have such payment duly provided for) of the
principal thereof and interest due thereon and other amounts due in connection
therewith before the Holders are entitled to receive any payment or distribution
of any assets (other than Capital Stock of the Company) on account of the
principal of or interest on the Securities;
(b) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to which the Holders or
the Trustee on behalf of the Holders would be entitled except for the provisions
of this Article 9, including any such payment or distribution which may be
payable or deliverable by reason of the payment of any other Indebtedness of the
Company being subordinated to the payment of the Securities, shall be paid by
the liquidating trustee or agent or other person making such payment or
distribution directly to the holders of Senior Indebtedness, (pro rata as to
each such holder or trustee on the basis of the respective amounts of unpaid
Senior Indebtedness held or represented by each), to the extent necessary to
make payment in full of all Senior Indebtedness remaining unpaid except that
Holders of the Securities shall be entitled to receive securities that are
subordinated to Senior Indebtedness to at least the same degree as the
Securities; and
65
(c) in the event that notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, including any such payment or distribution which may be
payable or deliverable by reason of the payment of any other Indebtedness of the
Company being subordinated to the payment of the Securities, shall be received
by the Trustee or the Holders or any Paying Agent (or, if the Company is acting
as its own Paying Agent, money for any such payment or distribution shall be
segregated or held in trust) on account of principal of or interest on the
Securities before all Senior Indebtedness is paid in full, such payment or
distribution (subject to the provisions of Sections 9.6 and 9.7) shall be
received and held in trust for and shall be paid forthwith over and delivered to
the holders of the Senior Indebtedness remaining unpaid or unprovided for (pro
rata as to each of such holders on the basis of the respective amounts of Senior
Indebtedness held by them), for application to the payment of such Senior
Indebtedness until all such Senior Indebtedness shall have been paid in full,
after giving effect to any concurrent payment or distribution or provision
thereof or to or for the holders of such Senior Indebtedness, except that
Holders of the Securities shall be entitled to receive securities that are
subordinated to Senior Indebtedness to at least the same extent as the
Securities.
The Company shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of the Company or any
assignment for the benefit of the Company's creditors.
SECTION 9.4. Securityholders To Be Subrogated to Rights of Holders of
Senior Indebtedness. Subject to the payment in full of all Senior Indebtedness
pursuant to this Article 9, the Holders of Securities shall be subrogated
equally and ratably to the rights of the holders of Senior Indebtedness to
receive payments or distributions of assets of the Company applicable to the
Senior Indebtedness until all amounts owing on the Securities shall be paid in
full, and for the purpose of such subrogation no such payments or distributions
to the holders of Senior Indebtedness by or on behalf of the Company or by or on
behalf of the Holders by virtue of this Article 9 which otherwise would have
been made to the Holders shall, as among the Company, its creditors other than
holders of the Senior Indebtedness and the Holders, be deemed to be payment by
the Company to or on account of the Senior Indebtedness, it being understood
that the provisions of this Article 9 are and are intended solely for the
purpose of defining the relative rights of the Holders, on the one hand, and the
holders of Senior Indebtedness, on the other hand.
SECTION 9.5. Obligations of the Company Unconditional. Nothing
contained in this Article 9 or elsewhere in this Indenture or in any Security is
intended to or shall impair, as among the Company, its creditors other than
holders of the Senior Indebtedness and the Holders, the obligation of the
Company, which is absolute and unconditional, to pay to the Holders the
principal amount of and other interest (including, to the extent lawful, any
interest on overdue installments of interest) on the Securities as and when the
same shall become due and payable in accordance with their terms, or is intended
to or shall affect the relative rights of the Holders and creditors of the
Company other than the holders of Senior Indebtedness, nor shall anything herein
or therein prevent the Trustee or any Holders from exercising, all remedies
otherwise permitted by applicable law upon Default under this Indenture, subject
to the rights, if any, under this Article 9 of the holders of Senior
Indebtedness in respect of cash, property or securities of the Company received
upon the exercise of any such remedy. Upon any distribution of assets of the
Company
66
referred to in this Article 9, the Trustee, subject to the provisions of
Sections 7.1 and 7.2, and the Holders shall be entitled to rely upon any order
or decree made by any court of competent jurisdiction in which such dissolution,
winding up, liquidation, reorganization or similar proceedings are pending, or a
certificate of the liquidating trustee or agent or other person making any
distribution to the Trustee or to the Holders, for the purpose of ascertaining
the persons entitled to participate in such distribution, the holders of Senior
Indebtedness and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 9.
SECTION 9.6. Trustee and Paying Agent Entitled To Assume Payments
Not Prohibited in Absence of Notice. The Trustee and Paying Agent shall not at
any time be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee or the Paying Agent or
the taking of any other action under this Article 9 by the Trustee unless and
until the Trustee or the Paying Agent shall have received written notice thereof
from the Company or from one or more holders of Senior Indebtedness or from the
trustee or agent, if any, under the Senior Indebtedness and, prior to the
receipt of any such written notice, the Trustee and Paying Agent, subject to the
provisions of Sections 7.1 and 7.2, shall be entitled in all respects
conclusively to assume that no such facts exist.
SECTION 9.7. Application by Trustee of Monies Deposited With It.
Subject to Article 8, any deposit of monies by the Company with the Trustee or
any Paying Agent (whether or not in trust) for the payment of the principal of
or interest on any Securities shall be subject to the provisions of Sections
9.1, 9.2, 9.3 and 9.4, except that, prior to the date on which by the terms of
this Indenture any such monies may become payable for any purpose (including,
without limitation, the payment of either the principal of or the other interest
on any Security), the Trustee shall not have received with respect to such
monies the notice provided for in Section 9.6, then the Trustee or the Paying
Agent shall have full power and authority to receive such monies and to apply
the same to the purpose for which they were received. This Section shall be
construed solely for the benefit of the Trustee and Paying Agent and nothing
herein shall be construed to relieve any Holders from the duties imposed upon
them under Section 9.3(c) with respect to monies received in violation of the
provisions of this Article 9. The foregoing shall not apply if the Company acts
as its own Paying Agent.
SECTION 9.8. Subordination Rights Not Impaired by Acts or Omissions
of Company or Holders of Senior Indebtedness. No right of any present or future
holders of any Senior Indebtedness to enforce subordination as provided herein
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder, or by any noncompliance by the Company with the terms of
this Indenture, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with. The holders of Senior Indebtedness may
extend, renew, modify or amend the terms of the Senior Indebtedness or any
security therefor and release, sell or exchange such security and otherwise deal
freely with the Company, all without affecting the liabilities and obligations
of the parties to the Indenture or the Holders. No provision in any
supplemental indenture which modifies this Article 9 or otherwise affects the
superior position of the holders of the Senior Indebtedness shall be effective
against the holders of the Senior Indebtedness who have not consented thereto.
67
SECTION 9.9. Securityholders Authorize Trustee To Effectuate
Subordination of Securities. Each Holder by its acceptance of Securities
authorizes and expressly directs the Trustee on its behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article 9 and to protect the rights of the Holders pursuant to this
Indenture and appoints the Trustee its attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or any other similar remedy or otherwise) tending towards liquidation
of the business and assets of the Company, the immediate filing of a claim for
the unpaid balance of its Securities in the form required in said proceedings
and causing said claim to be approved. If the Trustee does not file a proper
claim or proof of debt in the form required in such proceeding prior to 30 days
before the expiration of the time to file such claim or claims, then the holders
of Senior Indebtedness are hereby authorized to file an appropriate claim for
and on behalf of the Holders. In the event of any such proceeding, until the
Senior Indebtedness is paid in full in accordance with Section 9.3 (or adequate
provision made for such payment), without the consent of the holders of a
majority in aggregate principal amount outstanding of Senior Indebtedness, no
Holder shall waive, settle or compromise any such claim or claims relating to
the Securities that such Holder now or hereafter may have against the Company.
SECTION 9.10. Right of Trustee and Paying Agent To Hold Senior
Indebtedness. The Trustee and the Paying Agent, in their individual capacities,
shall be entitled to all of the rights set forth in this Article 9 in respect of
any Senior Indebtedness at any time held by either of them to the same extent as
any other holder of Senior Indebtedness, and nothing in this Indenture shall be
construed to deprive the Trustee or the Paying Agent of any of its rights as
such holder.
SECTION 9.11. Article 9 Not To Prevent Events of Default. The
failure to make a payment on account of principal of or other interest
(including any interest on overdue installments of interest and defaulted
interest) on the Securities by reason of any provision of this Article 9 shall
not be construed as preventing the occurrence of an Event of Default under
Section 6.1. Nothing contained in this Article 9 shall limited the right of the
Trustee or the Holders to take any action to accelerate the maturity of the
Securities pursuant to Section 6.2 or to pursue any rights or remedies hereunder
or under applicable law, subject to the rights, if any, under this Article 9 of
the holders, from time to time, of Senior Indebtedness.
SECTION 9.12. No Fiduciary Duty Created to Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness by virtue of the provisions of this Article 9,
and shall not be liable to any such holders (other than for its willful
misconduct or gross negligence) if it shall pay over to deliver to the Holders
or the Company or any other person, money or assets in compliance with the terms
of this Indenture.
ARTICLE 10
Amendments and Waivers
68
SECTION 10.1. Without Consent of Holders. The Company and the
Trustee may amend this Indenture or the Securities without notice to or consent
of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees with respect to the Securities or to secure the
Securities;
(5) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Company;
(6) to comply with any requirements of the SEC in connection with
qualifying this Indenture under the TIA;
(7) to provide for the acceptance of appointment hereunder by a
successor Trustee;
(8) to make any change that does not adversely affect the rights of
any Securityholder; or
(9) to provide for the issuance of the Exchange Securities, which
will have terms substantially identical in all material respects to the
Initial Securities (except that the transfer restrictions contained in the
Initial Securities will be modified or eliminated, as appropriate), and
which will be treated, together with any outstanding Initial Securities, as
a single issue of securities.
provided that the Company has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate stating that such amendment or supplement complies with
the provisions of this Section 10.1.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 10.2. With Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without notice to any Securityholder
but with the written consent of the Holders of at least a majority in principal
amount of the Securities. In addition, the Holders of at least a majority in
principal amount of the Securities by written notice to the Trustee may waive
future compliance by the Company with any provision of this Indenture or the
69
Securities. However, without the consent of each Securityholder affected, an
amendment or waiver may not:
(1) reduce the percentage of principal amount of Securities whose
Holders must consent to an amendment or waiver;
(2) reduce the rate of or extend the time for payment of interest on
any Security;
(3) reduce the principal of or extend the Stated Maturity of any
Security;
(4) reduce the premium payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with
Article 3;
(5) make any Security payable in money other than that stated in the
Security;
(6) impair the right of any Securityholder to institute suit for
enforcement of any payment on or with respect to any Security; or
(7) make any change in Section 6.4 or 6.7 or the second sentence of
this Section which adversely affects the rights of any Securityholder.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment or waiver, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment or waiver under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such amendment
or waiver. The failure to give such notice to all Securityholders, or any
defect therein, shall not impair or affect the validity of an amendment or
waiver under this Section.
SECTION 10.3. Compliance with Trust Indenture Act. Every amendment
to this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 10.4. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any
such Holder or subsequent Holder may revoke the consent or waiver as to such
Holder's Security or portion of the Security if the Trustee receives the notice
of revocation before the date the amendment or waiver becomes effective. After
an amendment or waiver becomes effective, it shall bind every Securityholder.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were
70
Securityholders 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 10.5. Notation on or Exchange of Securities. If an
amendment changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. The Trustee at the written direction
of the Company shall place an appropriate notation on the Security regarding the
changed terms and return it to the Holder. Alternatively, if the Company or the
Trustee so determines, the Company in exchange for the Security shall issue and
the Trustee shall authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or to issue a new Security shall not
affect the validity of such amendment.
SECTION 10.6. Trustee To Sign Amendments. The Trustee shall sign
any amendment authorized pursuant to this Article 10 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.1) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that (i) such
amendment is authorized or permitted by this Indenture and that all conditions
precedent to the execution, delivery and performance of such amendment have been
satisfied; and (ii) the Indenture together with such amendment complies with the
TIA.
SECTION 10.7. Payment for Consent. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 11
Miscellaneous
SECTION 11.1. 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, inclusive, of
the TIA, such imposed duties or incorporated provision shall control.
SECTION 11.2. Notices. Any notice or communication shall be in
writing and delivered in person, by telecopier or mailed by first-class mail
addressed as follows:
if to the Company:
Anacomp, Inc.
71
00000 Xxxxxxxxxxx Xxxxxx
Xxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention of Chief Financial Officer
if to the Trustee:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx, 11th Floor
New York, N.Y. 10004
Telecopy No.: (000) 000-0000
Attention of Corporate Trust Administration
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed
to the Securityholder at the Securityholder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 11.3. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 11.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 11.5. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
72
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 11.6. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 11.7. Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open in the
State of New York. If a payment date is a Legal Holiday, payment shall be made
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period. If a regular record date is a Legal Holiday,
the record date shall not be affected.
SECTION 11.8. Governing Law. THIS INDENTURE AND THE SECURITIES
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 LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY. THE PARTIES HERETO SUBMIT TO THE JURISDICTION OF COURTS
LOCATED IN THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE.
SECTION 11.9. No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company or the Trustee shall not have
any liability for any obligations of the Company or the Trustee, respectively,
under the Securities or this Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each securityholder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
SECTION 11.10. Successors. All agreements of the Company in this
Indenture and the Securities shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.
SECTION 11.11. 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 11.12. Qualification of Indenture. The Company shall qualify
this Indenture under the TIA in accordance with the terms and conditions of the
Registration Rights
73
Agreement and shall pay all reasonable costs and expenses (including
attorneys' fees for the Company, the Trustee and the Holders) incurred in
connection therewith, including, but not limited to, costs and expenses of
qualification of the Indenture and the Securities and printing this Indenture
and the Securities. The Trustee shall be entitled to receive from the Company
any such Officers' Certificates, Opinions of Counsel or other documentation
as it may reasonably request in connection with any such qualification of
this Indenture under the TIA.
SECTION 11.13. 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 11.14. Severability. In case any provision in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
74
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
ANACOMP, INC.
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
and Chief Executive Officer
IBJ XXXXXXXX BANK & TRUST
COMPANY, as Trustee
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Assistant Vice President
EXHIBIT A
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE
ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY),
ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,(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 "ACCREDITED INVESTOR" WITHIN THE MEANING
OF RULE 501 (a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE
IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUER AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITARY, OR BY THE DEPOSITARY OR NOMINEE OF SUCH SUCCESSOR DEPOSITARY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE.
Exhibit A
Page 3
[FORM OF FACE OF SECURITY]
$[_______________________]
CUSIP NO. [[____________]]
10 7/8% Series C Senior Subordinated Note due 2004
Global Note No.[_________]
ANACOMP, INC., an Indiana corporation, promises to pay to [_______],
or registered assigns, the principal sum of [____________] Dollars on April 1,
2004.
Interest Payment Dates: April 1 and October 1
Record Dates: March 1 and September 1
Additional provisions of this Security are set forth on the other side
of this Security.
Dated:
ANACOMP, INC.
[Seal] By:[_________________________________]
Vice President-Tax
[_________________________________]
Assistant Treasurer
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
IBJ XXXXXXXX BANK & TRUST COMPANY, as Trustee, certifies that this is
one of the Securities referred to in the Indenture.
By[_________________________________]
Authorized Signatory
Dated:________________
[FORM OF REVERSE SIDE OF SECURITY]
10 7/8% Series C Senior Subordinated Note due 2004
1. Interest
ANACOMP, INC., an Indiana corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above. The Company will pay interest
semiannually on April 1 and October 1 (each an "Interest Payment Date") of each
year, commencing October 1, 1998. Interest on the Securities will accrue from
and including the most recent date to which interest has been paid or, if no
interest has been paid, from the date of this Security. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company
shall pay interest on overdue principal at the rate borne by the Securities plus
1% per annum, and it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 1 or September 1 immediately preceding the Interest
Payment Date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying
Agent to collect principal payments. Except as provided in the next paragraph,
the Company will pay principal 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. However, the Company may pay principal and interest by check
payable in such money mailed to a Holder's registered address. The Company
shall pay to the Holder of this Security an amount in cash equal to 100% of the
interest payment due on such Interest Payment Date.
3. Paying Agent and Registrar
Initially, IBJ Xxxxxxxx Bank & Trust Company, a New York banking
corporation ("Trustee"), will act as Paying Agent and Registrar. The Company
may appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as of June
18, 1998 ("Indenture"), between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are obligations of the Company limited to $135,000,000
aggregate principal amount (subject to Section 2.9 of the Indenture). The
Indenture imposes certain limitations on the Company and the Restricted
Subsidiaries, including, subject to certain exceptions, limitations on the
Incurrence of Indebtedness, the payment of dividends on, and redemption of, the
Capital Stock of the Company and certain of its Subsidiaries, the redemption of
certain Subordinated Obligations of the Company and certain of its Subsidiaries,
the sale by the Company and certain of its Subsidiaries of assets and certain
Subsidiary stock, transactions with Affiliates, Sale/Leaseback Transactions by
the Company and certain of its Subsidiaries and consolidations and mergers and
transfer of all or substantially all the Company's and certain of its
Subsidiaries' assets. In addition, the Indenture limits the ability of the
Company and certain of its Subsidiaries to restrict distributions and dividends
from such Subsidiaries.
5. Optional Redemption
Except as set forth below, the Securities will not be redeemable at
the option of the Company prior to April 1, 2000. On and after such date, the
Securities will be redeemable at the option of the Company, in whole or in part
at any time and from time to time, at the redemption prices set forth below
(expressed as percentage of the principal amount), plus accrued and unpaid
interest (if any) to the date of redemption (subject to the right of the Holders
of record on the relevant date to receive interest due on the related interest
payment date):
Year Percentage
---- ----------
2000 . . . . . . . . . . . . 108.156%
2001 . . . . . . . . . . . . 105.438%
2002 . . . . . . . . . . . . 102.719%
2003 and thereafter . . . . 100.0%
At any time, or from time to time, on or prior to April 1, 2000 the
Company may, at its option, use the net cash proceeds of one or more Public
Equity Offerings (as defined) to redeem up to 35% of the aggregate principal
amount of Securities originally issued at a redemption price equal to 110.875%
of the principal amount thereof, plus, in each case, accrued and unpaid interest
to the date of redemption, provided that at least 65% of the aggregate principal
amount of Securities originally issued remains outstanding after any such
redemption. In order to effect the foregoing redemption with the proceeds of
any Public Equity Offering, the Company shall make such redemption not more than
60 days after the consummation of any such Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering" means a
public offering of Qualified Capital Stock of the Company pursuant to a
registration statement filed with the Commission in accordance with the
Securities Act.
2
If less than all of the Notes are to be redeemed, the Trustee shall
select by such methods as the Trustee shall deem to be fair and appropriate the
particular Notes to be redeemed or any portion thereof that is an integral
multiple of no more than $1,000.
Notwithstanding the foregoing, the Company may not make any optional
redemption of the Notes unless contemporaneously with such optional redemption
it redeems Existing Notes the aggregate principal amount of which bears the same
relationship to the aggregate principal amount of the Existing Notes outstanding
immediately prior to such optional redemption as the aggregate principal amount
of the Notes being redeemed bears to the aggregate principal amount of the Notes
outstanding immediately prior to such optional redemption.
The Notes will not have the benefit of a sinking fund.
6. Notice of Redemption
Notice of redemption will be mailed by the Company by first class mail
at least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at his registered address. Securities in
denominations larger than $1,000 may be redeemed in part but only in Authorized
Denominations. If money sufficient to pay the redemption price of and accrued
interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
7. Put Provisions
Upon the occurrence of a Change of Control, any Holder of Securities
will have the right to require the Company to repurchase all or any part of the
Securities of such Holder at a repurchase price equal to 101% of the principal
amount of the Securities to be repurchased plus accrued interest to the date of
repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the indenture.
Under certain circumstances, any Holder of Securities will have the
right to require the Company to repurchase all or part of the Securities of such
Holder at a repurchase price equal to 100% of the principal amount of the
Securities to be repurchased plus accrued interest to the date of repurchase
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date) from certain Net Cash
Proceeds of Asset Dispositions as provided in, and subject to the terms of the
Indenture.
8. Subordination
The Company's payment of the principal of and interest on the
Securities is subordinated and subject to the prior payment in full of the
Company's Senior Indebtedness as more fully set forth in the Indenture. Each
Holder of Securities by his acceptance hereof covenants and agrees that all
payments of the principal and interest on the Securities by the
3
Company shall be subordinated in accordance with Article 9 of the Indenture and
each holder accepts and agrees to be bound by such provisions.
9. Registration Rights
Pursuant to the Registration Rights Agreement, and subject to certain
terms and conditions stated therein, the Company will be obligated to consummate
an exchange offer pursuant to which the Holders of the Initial Securities shall
have the right to exchange this Security for Exchange Securities, which have
been registered under the Securities Act, in like principal amount and having
terms identical in all material respect to the Initial Securities.
10. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in Authorized
Denominations. A Holder may transfer or exchange Securities in accordance with
the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements or transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities for a period of 15 days before a
selection of Securities to be redeemed or 15 days before an interest payment
date.
11. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner of
it for all purposes.
12. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company and not to the Trustee for payment.
13. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
14. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount
4
outstanding of the Securities and (ii) any default or noncompliance with any
provision may be waived with the written consent of the Holders of a majority in
principal amount outstanding of the Securities. Subject to certain exceptions
set forth in the Indenture, without the consent of any Securityholder, the
Company and the Trustee may amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, to comply with Article 5 of the
Indenture, to provide for uncertificated Securities in addition to or in place
of certificated Securities, to add Guarantees with respect to the Securities, to
secure the Securities, to add additional covenants or surrender rights and
powers conferred on the Company, to comply with any request of the SEC in
connection with qualifying the Indenture under the Act or to make any change
that does not adversely affect the rights of any Securityholder.
15. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days
in payment of interest on the Securities; (ii) default in payment of principal
on the Securities at maturity, upon acceleration, redemption or otherwise, or
failure by the Company to redeem or Purchase Securities when required; (iii)
failure by the Company to comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of time; (iv) certain
accelerations (including failure to pay within any grace period after final
maturity) of other Indebtedness of the Company if the amount accelerated (or so
unpaid) exceeds $7,500,000 at the time; (v) certain events of bankruptcy or
insolvency with respect to the Company and any Restricted Subsidiary; and (vi)
certain judgments or decrees for the payment of money in excess of $7,500,000.
If an Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the Securities may declare all the
Securities to be due and payable immediately. Certain events of bankruptcy or
insolvency are Events of Default which will result in the Securities being due
and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture
or the Securities unless it receives reasonable indemnity or security. Subject
to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
16. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
17. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company
or the Trustee shall not have any liability for any obligations of the Company
under the Securities or the
5
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Securityholder
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
18. Authentication
This Security 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 Security.
19. Abbreviations
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), COST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
20. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
21. GOVERNING LAW
THE INDENTURE AND THE SECURITIES 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 LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written request
and without charge to the Securityholder a copy of the Indenture which has in it
the text of this Security in larger type. Requests may be made to:
Anacomp, Inc.
00000 Xxxxxxxxxxx Xxxxxx
Xxxxx, XX 00000
Attention of Corporate Communications
6
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint [_________________________] agent to transfer this
Security on the books of the Company. The agent may substitute another to act
for him.
Date:[__________________]Your Signature:[___________________________________]
(Sign exactly as your name appears on
the other side of the Security)
[_________________________________________________________________________]
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.7 or 4.9 of the Indenture, check the applicable box:
[ ] Section 4.7
[ ] Section 4.9
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.7 or 4.9 of the Indenture, state the amount:
$[_________________]
Date:[__________________]Your Signature:[___________________________________]
(Sign exactly as your name appears on
the other side of the Security)
Signature Guarantee:[_________________________________________]
(Signatures must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Registrar,
which requirements include membership or participation in
the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934.)
EXHIBIT B
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH
NOMINEE OF THE DEPOSITARY, OR BY THE DEPOSITARY OR NOMINEE OF SUCH
SUCCESSOR DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN THE INDENTURE.
EXHIBIT B
Page 2
[FORM OF FACE OF SECURITY]
$[_______________________]
CUSIP NO. [[____________]]
10 7/8% Series D Senior Subordinated Note due 2004
Global Note No.[_________]
ANACOMP, INC., an Indiana corporation, promises to pay to [_______],
or registered assigns, the principal sum of [____________] Dollars on April 1,
2004.
Interest Payment Dates: April 1 and October 1
Record Dates: March 1 and September 1
Additional provisions of this Security are set forth on the other side
of this Security.
Dated:
ANACOMP, INC.
[Seal] By:[_________________________________]
President
[_________________________________]
Secretary
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
IBJ XXXXXXXX BANK & TRUST COMPANY, as Trustee, certifies that this is
one of the Securities referred to in the Indenture.
By[_________________________________]
Authorized Signatory
Dated:____________________
[FORM OF REVERSE SIDE OF SECURITY]
10 7/8% Series D Senior Subordinated Note due 2004
1. Interest
ANACOMP, INC., an Indiana corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above. The Company will pay interest
semiannually on April 1 and October 1 (each an "Interest Payment Date") of each
year, commencing October 1, 1998. Interest on the Securities will accrue from
and including the most recent date to which interest has been paid or, if no
interest has been paid, from the date of this Security. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company
shall pay interest on overdue principal at the rate borne by the Securities plus
1% per annum, and it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 1 or September 1 immediately preceding the Interest
Payment Date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying
Agent to collect principal payments. Except as provided in the next paragraph,
the Company will pay principal 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. However, the Company may pay principal and interest by check
payable in such money mailed to a Holder's registered address. The Company
shall pay to the Holder of this Security an amount in cash equal to 100% of the
interest payment due on such Interest Payment Date.
3. Paying Agent and Registrar
Initially, IBJ Xxxxxxxx Bank & Trust Company, a New York banking
corporation ("Trustee"), will act as Paying Agent and Registrar. The Company
may appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as of June
18, 1998 ("Indenture"), between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are obligations of the Company limited to $135,000,000
aggregate principal amount (subject to Section 2.9 of the Indenture). The
Indenture imposes certain limitations on the Company and the Restricted
Subsidiaries, including, subject to certain exceptions, limitations on the
Incurrence of Indebtedness, the payment of dividends on, and redemption of, the
Capital Stock of the Company and certain of its Subsidiaries, the redemption of
certain Subordinated Obligations of the Company and certain of its Subsidiaries,
the sale by the Company and certain of its Subsidiaries of assets and certain
Subsidiary stock, transactions with Affiliates, Sale/Leaseback Transactions by
the Company and certain of its Subsidiaries and consolidations and mergers and
transfer of all or substantially all the Company's and certain of its
Subsidiaries' assets. In addition, the Indenture limits the ability of the
Company and certain of its Subsidiaries to restrict distributions and dividends
from such Subsidiaries.
5. Optional Redemption
Except as set forth below, the Securities will not be redeemable at
the option of the Company prior to April 1, 2000. On and after such date, the
Securities will be redeemable at the option of the Company, in whole or in part
at any time and from time to time, at the redemption prices set forth below
(expressed as percentage of the principal amount), plus accrued and unpaid
interest (if any) to the date of redemption (subject to the right of the Holders
of record on the relevant date to receive interest due on the related interest
payment date):
Year Percentage
---- ----------
2000 . . . . . . . . . . . . . 108.156%
2001 . . . . . . . . . . . . . 105.438%
2002 . . . . . . . . . . . . . 102.719%
2003 and thereafter . . . . . 100.000%
At any time, or from time to time, on or prior to April 1, 2000 the
Company may, at its option, use the net cash proceeds of one or more Public
Equity Offerings (as defined) to redeem up to 35% of the aggregate principal
amount of Securities originally issued at a redemption price equal to 110.875%
of the principal amount thereof, plus, in each case, accrued and unpaid interest
to the date of redemption, provided that at least 65% of the aggregate principal
amount of Securities originally issued remains outstanding after any such
redemption. In order to effect the foregoing redemption with the proceeds of
any Public Equity Offering, the Company shall make such redemption not more than
60 days after the consummation of any such Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering" means a
public offering of Qualified Capital Stock of the Company pursuant to a
registration statement filed with the Commission in accordance with the
Securities Act.
If less than all of the Notes are to be redeemed, the Trustee shall
select by such methods as the Trustee shall deem to be fair and appropriate the
particular Notes to be redeemed
2
or any portion thereof that is an integral multiple of no more than $1,000.
Notwithstanding the foregoing, the Company may not make any optional redemption
of the Notes unless contemporaneously with such optional redemption it redeems
Existing Notes the aggregate principal amount of which bears the same
relationship to the aggregate principal amount of the Existing Notes outstanding
immediately prior to such optional redemption as the aggregate principal amount
of the Notes being redeemed bears to the aggregate principal amount of the Notes
outstanding immediately prior to such optional redemption. The Notes will not
have the benefit of a sinking fund.
6. Notice of Redemption
Notice of redemption will be mailed by the Company by first class mail
at least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at his registered address. Securities in
denominations larger than $1,000 may be redeemed in part but only in Authorized
Denominations. If money sufficient to pay the redemption price of and accrued
interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
7. Put Provisions
Upon the occurrence of a Change of Control, any Holder of Securities
will have the right to require the Company to repurchase all or any part of the
Securities of such Holder at a repurchase price equal to 101% of the principal
amount of the Securities to be repurchased plus accrued interest to the date of
repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the indenture.
Under certain circumstances, any Holder of Securities will have the
right to require the Company to repurchase all or part of the Securities of such
Holder at a repurchase price equal to 100% of the principal amount of the
Securities to be repurchased plus accrued interest to the date of repurchase
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date) from certain Net Cash
Proceeds of Asset Dispositions as provided in, and subject to the terms of the
Indenture.
8. Subordination
The Company's payment of the principal of and interest on the
Securities is subordinated and subject to the prior payment in full of the
Company's Senior Indebtedness as more fully set forth in the Indenture. Each
Holder of Securities by his acceptance hereof covenants and agrees that all
payments of the principal and interest on the Securities by the Company shall be
subordinated in accordance with Article 9 of the Indenture and each holder
accepts and agrees to be bound by such provisions.
3
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in Authorized
Denominations. A Holder may transfer or exchange Securities in accordance with
the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements or transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities for a period of 15 days before a
selection of Securities to be redeemed or 15 days before an interest payment
date.
10. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner of
it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee may amend
the Indenture or the Securities to cure any ambiguity, omission, defect or
inconsistency, to comply with Article 5 of the Indenture, to provide for
uncertificated Securities in addition to or in place of certificated Securities,
to add Guarantees with respect to the Securities, to secure the Securities, to
add additional covenants or surrender rights and powers conferred on the
Company, to comply with any request of the SEC in connection with qualifying the
Indenture under the Act or to make any change that does not adversely affect the
rights of any Securityholder.
4
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days
in payment of interest on the Securities; (ii) default in payment of principal
on the Securities at maturity, upon acceleration, redemption or otherwise, or
failure by the Company to redeem or Purchase Securities when required; (iii)
failure by the Company to comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of time; (iv) certain
accelerations (including failure to pay within any grace period after final
maturity) of other Indebtedness of the Company if the amount accelerated (or so
unpaid) exceeds $7,500,000 at the time; (v) certain events of bankruptcy or
insolvency with respect to the Company and any Restricted Subsidiary; and (vi)
certain judgments or decrees for the payment of money in excess of $7,500,000.
If an Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the Securities may declare all the
Securities to be due and payable immediately. Certain events of bankruptcy or
insolvency are Events of Default which will result in the Securities being due
and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture
or the Securities unless it receives reasonable indemnity or security. Subject
to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company
or the Trustee shall not have any liability for any obligations of the Company
under the Securities or the Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
17. Authentication
This Security 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 Security.
5
18. Abbreviations
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), COST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
19. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
20. GOVERNING LAW
THE INDENTURE AND THE SECURITIES 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 LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written request
and without charge to the Securityholder a copy of the Indenture which has in it
the text of this Security in larger type. Requests may be made to:
Anacomp, Inc.
00000 Xxxxxxxxxxx Xxxxxx
Xxxxx, XX 00000
Attention of Corporate Communications
6
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint [_________________________] agent to transfer this
Security on the books of the Company. The agent may substitute another to act
for him.
Date:[__________________]Your Signature:[___________________________________]
(Sign exactly as your name appears on
the other side of the Security)
[_________________________________________________________________________]
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.7 or 4.9 of the Indenture, check the applicable box:
[ ] Section 4.7
[ ] Section 4.9
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.7 or 4.9 of the Indenture, state the amount:
$[_________________]
Date:[__________________]Your Signature:[___________________________________]
(Sign exactly as your name appears on
the other side of the Security)
Signature Guarantee:[_________________________________________]
(Signatures must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Registrar,
which requirements include membership or participation in
the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934.)
Schedule I to 10 7/8% Senior Subordinated Indenture
Indebtedness To Be Outstanding
Immediately After the Issue Date
Schedule II to 10 7/8% Senior Subordinated Indenture
Liens To be Outstanding Immediately After the Issue Date
Schedule III to 10 7/8% Senior Subordinated Indenture
U.S. Restricted Subsidiaries
Xidex International Corporation
Dysan International Sales Corporation II
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
IBJ Xxxxxxxx Bank & Trust Company, as Trustee
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, X.X. 10004
Attention: Corporate Trust Administration
Re: Anacomp, Inc.
10 7/8% Series C Senior Subordinated Notes due 2004
Ladies and Gentlemen:
In connection with our proposed purchase of 10 7/8% Senior
Subordinated Notes due 2004 (the "Securities") of Anacomp, Inc. (the "Company"),
we confirm that:
1. We have received a copy of the Offering Memorandum (the "Offering
Memorandum"), dated June 12, 1998 relating to the Securities and such other
information as we deem necessary in order to make our investment decision. We
acknowledge that we have read and agreed to the matters stated on pages (i) -
(iv) of the Offering Memorandum and in the section entitled "Transfer
Restrictions" of the Offering Memorandum including the restrictions on
duplication and circulation of the Offering Memorandum.
2. We understand that any subsequent transfer of the Securities is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Securities (as described in the Offering Memorandum) and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Securities except in compliance with, such restrictions and
conditions and the Securities Act of 1933, as amended (the "Securities Act").
3. We understand that the offer and sale of the Securities have not
been registered under the Securities Act, and that the Securities may not be
offered or sold except as permitted in the following sentence. We agree, on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell or otherwise transfer any Securities prior to the
date which is two years after the later of the original issuance of the
Securities and the last date that the Company or any affiliate of the Company
was the owner of the Securities (the "Resale Restriction Termination Date"), we
will do so only (i) to the Company, (ii) pursuant to a registration statement
that has been declared effective under the Securities Act, (iii) for so long as
the Securities are eligible for resale pursuant to Rule 144A, to a person it
reasonably believes is a "qualified institutional buyer" that purchases for its
own account or for the account of a "qualified institutional buyer" to whom
notice is given that the transfer is being made in reliance on Rule 144A, (iv)
pursuant to offers and sales that occur outside the United States within the
meaning of
Exhibit C
Page 2
Regulation S under the Securities Act, (v) to an institutional "accredited
investor" purchasing for its own account or for the account of such an
institutional "accredited investor", in each case in a minimum principal amount
of the Securities of $250,000 or (vi) 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 its property
or the property of such investor account or accounts be at all times within its
or their control. The foregoing restrictions on resale will not apply
subsequent to the Resale Restriction Termination Date. If any resale or other
transfer of the Securities is proposed to be made pursuant to clause (v) above
prior to the Resale Restriction Termination Date, the transferor shall deliver a
letter from the transferee to the Company and the Trustee, which shall provide,
among other things, that the transferee is an institutional "accredited
investor" that is acquiring such Securities not for distribution in violation of
the Securities Act. Each purchaser acknowledges that the Company and the
Trustee reserve the right prior to any offer, sale or other transfer prior to
the Resale Restriction Termination Date of the Securities pursuant to clauses
(iv), (v) or (vi) above to require the delivery of an opinion of counsel,
certifications and/or other information satisfactory to the Company and the
Trustee.
4. We are not acquiring the Securities for or on behalf of, and will
not transfer the Securities to, any pension or welfare plan (as defined in
Section 3 of the Employee Retirement Income Security Act of 1974), except as
permitted in the section entitled "Transfer Restrictions" of the Offering
Memorandum.
5. We understand that, on any proposed resale of any Securities, we
will be required to furnish to the Trustee and the Company such certification,
legal opinions and other information as the Trustee and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Securities purchased by us will
bear a legend to the foregoing effect.
6. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Securities, and we
and any accounts for which we are acting are each able to bear the economic risk
of our or their investment, as the case may be.
7. We are acquiring the Securities purchased by us for our account or
for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
By:[ ]
-----------------------------
Name:
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[_______________], [____]
IBJ Xxxxxxxx Bank & Trust Company, as Trustee
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, X.X. 10004
Attention: Corporate Trust Administration
Re: Anacomp, Inc.
(the "Company") 10 7/8% Series C Senior Subordinated
Notes due 2004 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $[ ] aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a Person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United States, or
(b) the transaction was executed in, on or through the facilities of a
designated off-shore securities market and neither we nor any person acting on
our behalf knows that the transaction has been pre-arranged with a buyer in the
United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation
S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
Exhibit D
Page 2
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:[___________________________]
Authorized Signature
