Exhibit 4.1
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Jordan Telecommunication Products, Inc.
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SERIES A AND SERIES B
9 7/8% SENIOR NOTES DUE 2007
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INDENTURE
DATED AS OF JULY 25, 1997
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FIRST TRUST NATIONAL ASSOCIATION
Trustee
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TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE............................ 1
SECTION 1.1 DEFINITIONS................................................. 25
SECTION 1.2 OTHER DEFINITIONS........................................... 26
SECTION 1.3 INCORPORATION BY
REFERENCE OF
TRUST INDENTURE ACT.................................... 26
SECTION 1.4 RULES OF CONSTRUCTION....................................... 26
ARTICLE 2
THE SENIOR NOTES.......................... 27
SECTION 2.1 FORM AND DATING............................................. 28
SECTION 2.2 EXECUTION AND AUTHENTICATION................................ 29
SECTION 2.3 REGISTRAR AND PAYING AGENT.................................. 29
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST......................... 30
SECTION 2.5 HOLDER LISTS................................................ 40
SECTION 2.6 TRANSFER AND EXCHANGE....................................... 40
SECTION 2.7 REPLACEMENT SENIOR NOTES.................................... 41
SECTION 2.8 OUTSTANDING SENIOR NOTES.................................... 41
SECTION 2.9 TREASURY SENIOR NOTES....................................... 41
SECTION 2.10 TEMPORARY SENIOR NOTES...................................... 42
SECTION 2.11 CANCELLATION................................................ 42
SECTION 2.12 DEFAULTED INTEREST.......................................... 42
SECTION 2.13 RECORD DATE................................................. 43
SECTION 2.14 CUSIP NUMBER................................................ 44
ARTICLE 3
OPTIONAL REDEMPTION AND
MANDATORY OFFERS TO PURCHASE.................... 45
SECTION 3.1 NOTICES TO TRUSTEE.......................................... 46
SECTION 3.2 SELECTION OF
SENIOR NOTES TO BE
REDEEMED OR PURCHASED.................................. 46
SECTION 3.3 NOTICE OF REDEMPTION........................................ 47
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION.............................. 47
i
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE................................. 48
SECTION 3.6 SENIOR NOTES REDEEMED IN PART............................... 51
SECTION 3.7 OPTIONAL REDEMPTION PROVISIONS.............................. 51
SECTION 3.8 MANDATORY PURCHASE PROVISIONS............................... 53
ARTICLE 4
COVENANTS.............................. 54
SECTION 4.1 PAYMENT OF SENIOR NOTES..................................... 54
SECTION 4.2 SEC REPORTS................................................. 59
SECTION 4.3 COMPLIANCE CERTIFICATE...................................... 59
SECTION 4.4 STAY, EXTENSION AND USURY LAWS.............................. 60
SECTION 4.5 LIMITATION ON RESTRICTED PAYMENTS........................... 62
SECTION 4.6 CORPORATE EXISTENCE......................................... 62
SECTION 4.7 LIMITATION ON INCURRENCE OF INDEBTEDNESS.................... 63
SECTION 4.8 LIMITATION ON TRANSACTIONS WITH AFFILIATES.................. 64
SECTION 4.9 LIMITATION ON LIENS......................................... 65
SECTION 4.10 COMPLIANCE WITH LAWS, TAXES................................. 66
SECTION 4.11 LIMITATION ON
DIVIDENDS AND OTHER PAYMENT
RESTRICTIONS AFFECTING
RESTRICTED SUBSIDIARIES................................ 68
SECTION 4.12 MAINTENANCE OF OFFICE OR AGENCIES........................... 69
SECTION 4.13 CHANGE OF CONTROL........................................... 71
SECTION 4.14 LIMITATION ON ASSET SALES................................... 72
SECTION 4.15 LIMITATION ON
GUARANTEES OF COMPANY IN
DEBTEDNESS BY RESTRICTED
SUBSIDIARIES........................................... 72
SECTION 4.16 DESIGNATION OF RESTRICTED
AND NON-RESTRICTED
SUBSIDIARIES........................................... 75
ARTICLE 5
SUCCESSORS............................. 76
SECTION 5.1 MERGER OR CONSOLIDATION..................................... 76
SECTION 5.2 SUCCESSOR CORPORATION SUBSTITUTED........................... 76
ii
ARTICLE 6
DEFAULTS AND REMEDIES........................ 77
SECTION 6.1 EVENTS OF DEFAULT............................................ 77
SECTION 6.2 ACCELERATION................................................. 77
SECTION 6.3 OTHER REMEDIES............................................... 78
SECTION 6.4 WAIVER OF PAST DEFAULTS...................................... 79
SECTION 6.5 CONTROL BY MAJORITY.......................................... 79
SECTION 6.6 LIMITATION ON SUITS.......................................... 80
SECTION 6.7 RIGHTS OF HOLDERS TO RECEIVE PAYMENT......................... 81
SECTION 6.8 COLLECTION SUIT BY TRUSTEE................................... 82
SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM............................. 82
SECTION 6.10 PRIORITIES................................................... 83
SECTION 6.11 UNDERTAKING FOR COSTS........................................ 83
ARTICLE 7
TRUSTEE................................ 84
SECTION 7.1 DUTIES OF TRUSTEE............................................ 85
SECTION 7.2 RIGHTS OF TRUSTEE............................................ 86
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE................................. 86
SECTION 7.4 TRUSTEE'S DISCLAIMER......................................... 87
SECTION 7.5 NOTICE TO HOLDERS OF
DEFAULTS AND EVENTS OF
DEFAULT................................................. 87
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS................................ 88
SECTION 7.7 COMPENSATION AND INDEMNITY................................... 90
SECTION 7.8 REPLACEMENT OF TRUSTEE....................................... 90
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC............................. 91
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION................................ 91
SECTION 7.11 PREFERENTIAL COLLECTION OF
CLAIMS AGAINST THE
COMPANY................................................. 92
ARTICLE 8
DISCHARGE OF INDENTURE....................... 92
SECTION 8.1 DISCHARGE OF LIABILITY ON
SENIOR NOTES; DEFEASANCE................................ 94
SECTION 8.2 CONDITIONS TO DEFEASANCE..................................... 94
SECTION 8.3 APPLICATION OF TRUST MONEY................................... 95
iii
SECTION 8.4 REPAYMENT TO THE COMPANY.................................... 95
SECTION 8.5 INDEMNITY FOR GOVERNMENT OBLIGATIONS........................ 96
SECTION 8.6 REINSTATEMENT............................................... 96
ARTICLE 9
AMENDMENTS............................. 97
SECTION 9.1 AMENDMENTS AND SUPPLEMENTS
PERMITTED WITHOUT CONSENT
OF HOLDERS............................................. 97
SECTION 9.2 AMENDMENTS AND SUPPLEMENTS
REQUIRING CONSENT OF
HOLDERS................................................ 98
SECTION 9.3 COMPLIANCE WITH TIA......................................... 98
SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS........................... 99
SECTION 9.5 NOTATION ON OR EXCHANGE OF SENIOR NOTES..................... 99
SECTION 9.6 TRUSTEE PROTECTED........................................... 99
ARTICLE 10
MISCELLANEOUS............................ 99
SECTION 10.1 TRUST INDENTURE ACT CONTROLS................................ 99
SECTION 10.2 NOTICES..................................................... 100
SECTION 10.3 COMMUNICATION BY
HOLDERS WITH
OTHER HOLDERS.......................................... 100
SECTION 10.4 CERTIFICATE AND OPINION AS TO
CONDITIONS PRECEDENT................................... 100
SECTION 10.5 STATEMENTS REQUIRED IN
CERTIFICATE OR OPINION................................. 100
SECTION 10.6 RULES BY TRUSTEE AND AGENTS................................. v
SECTION 10.7 LEGAL HOLIDAYS....................................................
SECTION 10.8 NO RECOURSE AGAINST OTHERS........................................
SECTION 10.9 COUNTERPARTS......................................................
SECTION 10.10 VARIABLE PROVISIONS...............................................
SECTION 10.11 GOVERNING LAW.....................................................
iv
SECTION 10.12 NO ADVERSE INTERPRETATION OF
OTHER AGREEMENTS.......................................
SECTION 10.13 SUCCESSORS..................................................
SECTION 10.14 SEVERABILITY................................................
SECTION 10.15 TABLE OF CONTENTS, HEADINGS, ETC............................
EXHIBIT A FORM OF SENIOR NOTE.........................................
EXHIBIT B CERTIFICATE TO BE DELIVERED UPON
EXCHANGE OR REGISTRATION OF
TRANSFER OF SENIOR NOTES...............................
EXHIBIT C FORM OF CERTIFICATE TO BE DELIVERED
BY INSTITUTIONAL ACCREDITED INVESTORS..................
v
CROSS-REFERENCE TABLE
Trust Indenture
Act Section................................................. Indenture Section
310(a)(1)................................................... 7.10
(a)(2)................................................ 7.10
(a)(3)................................................ N.A.
(a)(4)................................................ N.A.
(a)(5)................................................. 7.10
(b)................................................... 7.10
(c)................................................... N.A.
311(a)...................................................... 7.11
(b)................................................... 7.11
(c)................................................... N.A.
312(a)...................................................... 2.5
(b)................................................... 10.3
(c)................................................... 10.3
313(a)...................................................... 7.6
(b)(1)................................................ N.A.
(b)(2)................................................ 7.6; 10.2
(c)................................................... 7.6
(d)................................................... 7.6
314(a)...................................................... 4.2; 10.2
(a)(1)................................................ N.A.
(a)(2)................................................ N.A.
(a)(3)................................................ N.A.
(a)(4)................................................ 10.5
(b)................................................... N.A.
(c)(1)................................................ 10.4
(c)(2)................................................ 10.4
(c)(3)................................................ N.A.
(d)................................................... N.A.
(e)................................................... 10.5
(f)................................................... N.A.
315(a)...................................................... 7.1
(b)................................................... 7.5
(c)................................................... 7.1
(d)................................................... 7.1
(e)................................................... 6.11
316(a)(last sentence)....................................... 2.9
(a)(1)(A)............................................. 6.5
(a)(1)(B)............................................. 6.4
(a)(2)................................................ N.A.
(b)................................................... 6.4; 6.7
(c)................................................... 2.13
317(a)(1)................................................... 6.8
(a)(2)................................................ 6.9
(b)................................................... 2.4
318(a)...................................................... 10.1
vi
0132099.01-New York Server 7a Draft July 18, 1997 - 2:31 pm
This Indenture, dated as of July 25, 1997, is between Jordan
Telecommunication Products, Inc., a Delaware corporation (the "Company"), and
First Trust National Association, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the holders of the Company's 9 7/8% Series A Senior
Notes due 2007 (the "Series A Senior Notes") and the Company's 9 7/8% Series B
Senior Notes due 2007 (the "Series B Senior Notes," and, together with the
Series A Senior Notes, the "Senior Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.1 DEFINITIONS.
"Accreted Value" means with respect to any Discount Note (i) as of any date
prior to August 1, 2000, the sum of (a) the initial offering price of the
Discount Notes, and (b) the portion of the original issue discount on such
Discount Note (which for this purpose shall be deemed to be the excess of the
principal amount over the initial offering price) that has been amortized with
respect to such Discount Note through such date, such original issue discount to
be amortized at the rate of 11 3/4% per annum (such percentage being expressed
as a percentage of the sum of the initial offering price plus previously
amortized original issue discount) using semi-annual compounding of such rate on
each August 1 and February 1, commencing from the date of original issuance of
the Discount Notes through such date, and (ii) on and after August 1, 2000 the
principal amount of such Discount Note.
"Affiliate" means any of the following: (i) any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company, (ii) any spouse, immediate family member or other
relative who has the same principal residence as any Person described in clause
(i) above, (iii) any trust in which any such Persons described in clause (i) or
(ii) above has a beneficial interest, and (iv) any corporation or other
organization of which any such Persons described
above collectively own 50% or more of the equity of such entity.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Asset Sale" means the sale, lease, conveyance or other disposition by the
Company or a Restricted Subsidiary of assets or property whether owned on the
date of original issuance of the Senior Notes or thereafter acquired, in a
single transaction or in a series of related transactions, that are outside of
the ordinary course of business of the Company or such Restricted Subsidiary;
provided that Asset Sales will not include such sales, leases, conveyances or
dispositions in connection with (i) the sale or disposition of any Restricted
Investment, (ii) the sale or lease of equipment, inventory, accounts receivable
or other assets in the ordinary course of business, (iii) Receivables
Financings, (iv) the surrender or waiver of contract rights or the settlement,
release or surrender of contract, tort or other claims of any kind, (v) the
grant of any license of patents, trademarks, registration therefor and other
similar intellectual property, (vi) a transfer of assets by the Company or a
Restricted Subsidiary to any of the Company, a Restricted Subsidiary or a Non-
Restricted Subsidiary, (vii) the designation of a Restricted Subsidiary as a
Non-Restricted Subsidiary pursuant to Section 4.16, other than a Subsidiary
excluded from the definition of Restricted Subsidiary by clause (ii)(B) of such
definition, (viii) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Company as permitted under Section 5.l,
or (ix) Restricted Payments permitted by Section 4.5.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Board of Directors" means the Company's board of directors or any
authorized committee of such board of directors.
"Business Day" means any day other than a Legal Holiday.
2
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of corporate stock, including any
preferred stock.
"Cash Flow" means, for any given period and Person, the sum of, without
duplication, Consolidated Net Income, plus (a) the portion of Net Income
attributable to the minority interests in its Subsidiaries, to the extent not
included in calculating Consolidated Net Income, plus (b) provision for taxes
based on income or profits to the extent such income or profits were included in
computing Consolidated Net Income, plus (c) Consolidated Interest Expense, to
the extent deducted in computing Consolidated Net Income, plus (d) the
amortization of all intangible assets, to the extent such amortization was
deducted in computing Consolidated Net Income (including, but not limited to,
inventory write-ups, goodwill, debt and financing costs, and Incentive
Arrangements), plus (e) any non-capitalized transaction costs incurred in
connection with financings, acquisitions or dispositions (including, but not
limited to, financing and refinancing fees, including those in connection with
the Offering and the Company Formation, in each case, to the extent deducted in
computing Consolidated Net Income), plus (f) all depreciation and all other non-
cash charges, to the extent deducted in computing Consolidated Net Income, plus
(g) interest income, to the extent such income was not included in computing
Consolidated Net Income, plus (h) all dividend payments on preferred stock
(whether or not paid in cash) to the extent deducted in computing Consolidated
Net Income, plus (i) any extraordinary or non-recurring charge or expense
arising out of the implementation of SFAS 106 or SFAS 109 to the extent deducted
in computing Consolidated Net Income, plus (j) to the extent not covered in
clause (e) above, fees paid or payable in respect of the New TJC Management
Consulting Agreement to the extent deducted in computing Consolidated Net
Income, plus (k) the net loss of any Person, other than those of a Restricted
Subsidiary, to the extent deducted in computing Consolidated Net Income, plus
(1) net losses in respect of any discontinued operations as determined in
accordance with GAAP, to the extent deducted in computing Consolidated Net
Income; provided, however, that if any such calculation includes any period
during which an acquisition or sale of a Person or the incurrence or repayment
of Indebtedness
3
occurred, then such calculation for such period shall be made on a Pro Forma
Basis.
"Cash Flow Coverage Ratio" means, for any given period and Person, the
ratio of: (i) Cash Flow, divided by (ii) the sum of Consolidated Interest
Expense and the amount of all dividend payments on any series of preferred
stock of such Person (except for dividends paid or payable in additional shares
of Capital Stock (other than Disqualified Stock)), in each case, without
duplication; provided, however, that if any such calculation includes any period
during which an acquisition or sale of a Person or the incurrence or repayment
of Indebtedness occurred, then such calculation for such period shall be made on
a Pro Forma Basis.
"Change of Control" means the occurrence of any of the following: (i) any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), excluding the Jordan Stockholders, 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 securities that
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 Stock of the Company; or (ii) the Company
consolidates with, or merges with or into, another Person or sells, assigns,
conveys, transfers, leases or otherwise disposes of all or substantially all of
its assets to any Person, or any Person consolidates with, or merges with or
into, the Company, in any such event pursuant to a transaction in which the
outstanding Voting Stock of the Company is converted into or exchanged for cash,
securities or other property, other than any such transaction where (A) the
outstanding Voting Stock of the Company is converted into or exchanged for (1)
Voting Stock (other than Disqualified Stock) of the surviving or transferee
corporation or (2) cash, securities and other property in an amount which could
be paid by the Company as a Restricted Payment under the Indenture and (B)
immediately after such transaction no "person" or "group" (as such terms are
used in Sections 13(d) and 14(d) of the Exchange Act), excluding the Jordan
Stockholders, is 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 securi-
4
ties that 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 Stock of the surviving or
transferee corporation; or (iii) during any consecutive two-year period,
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 of Directors or whose nomination for election by the stockholders of the
Company was approved by a vote of a majority of the directors then still in
office who are entitled to vote to elect such new director and were either
directors at the beginning of such period or Persons whose election as directors
or nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors of the Company then in office.
"Commission" means the Securities and Exchange Commission.
"Company" means Jordan Telecommunication Products, Inc., a Delaware
corporation.
"Company Formation" means the formation of the Company by the Company's
management and stockholders of Jordan Industries, Inc. and certain of their
affiliates in connection with an overall recapitalization and refinancing of
Jordan Industries, Inc.
"Consolidated Interest Expense" means, for any given period and Person, the
aggregate of the interest expense in respect of all Indebtedness of such Person
and its Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP (including amortization of original issue discount on any
such Indebtedness, all non-cash interest payments, the interest portion of any
deferred payment obligation and the interest component of capital lease
obligations, but excluding amortization of deferred financing fees if such
amortization would otherwise be included in interest expense); provided,
however, that for the purpose of the Cash Flow Coverage Ratio, Consolidated
Interest Expense shall be calculated on a Pro Forma Basis; provided further,
that any premiums, fees and expenses (including the amortization thereof)
payable in connection with the Offering and the Company Formation and the
application of the net proceeds
5
therefrom or any other refinancing of Indebtedness will be excluded.
"Consolidated Net Income" means, for any given period and Person, the
aggregate of the Net Income of such Person and its Subsidiaries for such period,
on a consolidated basis, determined in accordance with GAAP; provided, however,
that: (i) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition shall be
excluded, and (ii) Consolidated Net Income of any Person will not include,
without duplication, any deduction for: (A) any increased amortization or
depreciation resulting from the write-up of assets pursuant to Accounting
Principles Board Opinion Nos. 16 and 17, as amended or supplemented from time to
time, (B) the amortization of all intangible assets (including amortization
attributable to inventory write-ups, goodwill, debt and financing costs, and
Incentive Arrangements), (C) any non-capitalized transaction costs incurred in
connection with financings, acquisitions or divestitures (including, but not
limited to, financing and refinancing fees), (D) any extraordinary or
nonrecurring charges relating to any premium or penalty paid, write-off of
deferred financing costs, or other financial recapitalization charges in
connection with redeeming or retiring any Indebtedness prior to its stated
maturity, and (E) any Restructuring Charges; provided, however, that for
purposes of determining the Cash Flow Coverage Ratio, Consolidated Net Income
shall be calculated on a Pro Forma Basis.
"Consolidated Net Worth" with respect to any Person means, as of any date,
the consolidated equity of the common stockholders of such Person (excluding the
accumulated foreign currency translation adjustment), all determined on a
consolidated basis in accordance with GAAP, but without any reduction in respect
of the payment of dividends on any series of such Person's preferred stock if
such dividends are paid in additional shares of Capital Stock (other than
Disqualified Stock); provided, however, that Consolidated Net Worth shall also
include, without duplication: (a) the amortization of all write-ups of
inventory, (b) the amortization of all intangible assets (including amortization
of goodwill, debt and financing costs, and Incentive Arrangements), (c) any non-
capitalized transaction costs incurred in connection with financings,
acquisitions or divestitures (including,
6
but not limited to, financing and refinancing fees), (d) any increased
amortization or depreciation resulting from the write-up of assets pursuant to
Accounting Principles Board Opinion Nos. 16 and 17, as amended and supplemented
from time to time, (e) any extraordinary or nonrecurring charges or expenses
relating to any premium or penalty paid, write-off of deferred financing costs,
or other financial recapitalization charges incurred in connection with
redeeming or retiring any Indebtedness prior to its stated maturity, (f) any
Restructuring Charges, and (g) any extraordinary or non-recurring charge arising
out of the implementation of SFAS 106 or SFAS 109; provided, however, that in
determining Consolidated Net Worth for purposes of Section 5.1, Consolidated Net
Worth shall be calculated on a Pro Forma Basis.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Definitive Senior Notes" means Senior Notes that are in the form of
Exhibit A attached hereto (but without including the text referred to in
footnotes 1 and 2 thereto).
"Depositary" means, with respect to the Senior Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.3 hereof as
the Depositary with respect to the Senior Notes, until a successor shall have
been appointed and become such pursuant to Section 2.6 of this Indenture, and,
thereafter, "Depositary" shall mean or include such successor.
"Discount Notes" means the 11 3/4% Senior Discount Notes due 2007 of the
Company.
"Discount Notes Indenture" means the indenture, dated July 25, 1997,
between the Company and First Trust National Association, as trustee, relating
to the Discount Notes, as such indenture may be amended or supplemented from
time to time.
"Disqualified Stock" means any Capital Stock that by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder
7
thereof, in whole or in part on, or prior to, the maturity date of the Senior
Notes.
"Dura-Line Agreement" means the Preferred Stock Agreement among Dura-Line
Corporation and certain other persons, as in effect on the date of the original
issuance of the Senior Notes.
"Dura-Line Preferred Stock" means the 187.5 shares outstanding of Dura-Line
Corporation's 7% cumulative preferred stock with an aggregate liquidation
preference of $1.9 million issued to former common stockholders of Dura-Line
Corporation.
"Equity Interests" means Capital Stock or partnership interests or
warrants, options or other rights to acquire Capital Stock or partnership
interests (but excluding (i) any debt security that is convertible into or
exchangeable for, Capital Stock or partnership interests, and (ii) any other
Indebtedness or Obligation) provided, however, that Equity Interests will not
include any Incentive Arrangements or obligations or payments thereunder.
"Equity Offering" means a public or private offering by the Company and/or
its Subsidiaries for cash of Capital Stock or other Equity Interests and all
warrants, options or other rights to acquire Capital Stock, other than (i) an
offering of Disqualified Stock or (ii) Incentive Arrangements or obligations or
payments thereunder.
"Exchange Offer" means the offer by the Company to Holders to exchange
Series B Senior Notes for Series A Senior Notes.
"GAAP" means generally accepted accounting principles, consistently
applied, as of the date of original issuance of the Senior Notes. All financial
and accounting determinations and calculations under the Indenture will be made
in accordance with GAAP.
"Global Senior Note" means a Senior Note that contains the paragraph
referred to in footnote 1 and the additional schedule referred to in footnote 2
to the form of the Senior Note attached hereto as Exhibit A.
8
"Hedging Obligations" means, with respect to any Person, the Obligations of
such Persons under (i) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements, (ii) foreign exchange
contracts, currency swap agreements or similar agreements, and (iii) other
agreements or arrangements designed to protect such Person against fluctuations,
or otherwise to establish financial xxxxxx in respect of exchange rates,
currency rates or interest rates.
"Holder" means a Person in whose name a Senior Note is registered.
"Incentive Arrangements" means any earn-out agreements, stock appreciation
rights, "phantom" stock plans, employment agreements, non-competition
agreements, subscription and stockholders agreements and other incentive and
bonus plans and similar arrangements made in connection with acquisitions of
Persons or businesses by the Company or any Restricted Subsidiary or the
retention of executives, officers or employees by the Company or any Restricted
Subsidiary.
"Indebtedness" means, with respect to any Person, any indebtedness, whether
or not contingent, in respect of borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or representing the balance deferred and unpaid
of the purchase price of any property (including pursuant to capital leases),
except any such balance that constitutes an accrued expense or a trade payable,
and any Hedging Obligations, if and to the extent such indebtedness (other than
a Hedging Obligation) would appear as a liability upon a balance sheet of such
Person prepared on a consolidated basis in accordance with GAAP, and also
includes, to the extent not otherwise included, the guarantee of items which
would be included within this definition; provided, however, that "Indebtedness"
will not include any Incentive Arrangements or obligations or payments
thereunder.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
bankruptcy or similar case or proceeding,
9
or any reorganization, receivership, liquidation, dissolution or winding up of
the Company, whether voluntary or involuntary, or (ii) any assignment for the
benefit of creditors or any other marshalling of assets and liabilities of the
Company.
"Investment" means any capital contribution to, or other debt or equity
investment in, any Person.
"Issue" means create, issue, assume, guarantee, incur or otherwise become
directly or indirectly liable for any Indebtedness or Capital Stock, as
applicable; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
issued by such Restricted Subsidiary at the time it becomes a Restricted
Subsidiary. For this definition, the terms "issuing," "issuer," "issuance" and
"issued" have meanings correlative to the foregoing.
"Jordan Stockholders" means Xxxx X. Xxxxxx, XX, and/or his heirs, executors
and administrators, The Xxxx X. Xxxxxx, XX Revocable Trust, The Jordan Family
Trust and/or any other trust established by Xxxx X. Xxxxxx, XX whose
beneficiaries are Xxxx X. Xxxxxx, XX and/or his lineal descendants or other
relatives, Jordan Industries, Inc., The Jordan Company and Jordan/Zalaznick
Capital Corporation and their respective affiliates, principals, partners and
employees, family members of any of the foregoing and trusts for the benefit of
any of the foregoing, including, without limitation, MCIT PLC and Leucadia
National Corporation and their respective Subsidiaries.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, the city in which the principal corporate
trust office of the Trustee is located or at a place of payment are authorized
by law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
10
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell and any filing of or
agreement to give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant to
Section 4 of the Registration Rights Agreement.
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP, excluding, however, any gain
or loss, together with any related provision for taxes, realized in connection
with any Asset Sale (including, without limitation, dispositions pursuant to
sale and leaseback transactions).
"Net Proceeds" means, with respect to any Asset Sale, the aggregate amount
of cash proceeds (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, and including
any amounts received as disbursements or withdrawals from any escrow or similar
account established in connection with any such Asset Sale, but, in either such
case, only as and when so received) received by the Company or any of its
Restricted Subsidiaries in respect of such Asset Sale, net of: (i) the cash
expenses of such Asset Sale (including, without limitation, the payment of
principal, premium, if any, and interest on, Indebtedness required to be paid as
a result of such Asset Sale (other than the Senior Notes) and legal, accounting,
management, advisory and investment banking fees and sales commissions), (ii)
taxes paid or payable as a result thereof, (iii) any portion of cash proceeds
that the Company determines in good faith should be reserved for post-closing
adjustments, it being understood and agreed that on the day that all such post-
closing adjustments have been determined, the amount (if any) by which the
reserved amount in respect of such Asset Sale exceeds the actual postclosing
adjustments
11
payable by the Company or any of its Restricted Subsidiaries shall constitute
Net Proceeds on such date, (iv) any relocation expenses and pension, severance
and shutdown costs incurred as a result thereof, and (v) any deduction or
appropriate amounts to be provided by the Company or any of its Restricted
Subsidiaries as a reserve in accordance with GAAP against any liabilities
associated with the asset disposed of in such transaction and retained by the
Company or such Restricted Subsidiary after such sale or other disposition
thereof, including, without limitation, pension and other post-employment
benefit liabilities and liabilities related to environmental matters or against
any indemnification obligations associated with such transaction.
"New Credit Agreement" means the credit agreement, dated the date hereof,
entered into by certain of the Company's Restricted Subsidiaries and certain
other subsidiaries and the lenders party thereto in their capacities as
lenders thereunder and BankBoston, N.A., as agent, together with all loan
documents and instruments thereunder (including, without limitation, any
guarantee agreements, including the guarantee by the Company, and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from time
to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including, without limitation, increasing
the amount of available borrowings thereunder, and all Obligations with respect
thereto, in each case, to the extent permitted by Section 4.7, or adding
Subsidiaries of the Company as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under such agreement or any successor or
replacement agreement and whether by the same or any other agent, lender or
group of lenders.
"New Subsidiary Advisory Agreement" means the advisory agreement, dated
July 25, 1997, between the Company and each of its Subsidiaries and Jordan
Industries, as in effect on the date of the original issuance of the Senior
Notes.
"New Subsidiary Consulting Agreement" means the management consulting
agreement, dated July 25, 1997, between the Company and each of its
Subsidiaries and Jordan
12
Industries, as in effect on the date of the original issuance of the Senior
Notes.
"New TJC Management Consulting Agreement" means the Management Consulting
Agreement, dated as of July 25, 1997, between the Company and TJC Management
Corporation, as in effect on the date of original issuance of the Senior Notes.
"Non-Restricted Subsidiary" means any Subsidiary of the Company, other than
a Restricted Subsidiary.
"Obligations" means, with respect to any Indebtedness, all principal,
interest, premium, penalties, fees, indemnities, expenses (including legal fees
and expenses), reimbursement obligations and other liabilities payable to the
holder of such Indebtedness under the documentation governing such Indebtedness,
and any other claims of such holder arising in respect of such Indebtedness.
"Offering" means the offer and sale of, among other securities, the Senior
Notes as contemplated by the Offering Circular.
"Offering Circular" means the Offering Circular, dated July 21, 1997,
relating to the Company's offering and placement of, among other securities, the
Senior Notes.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the Company
by two Officers of the Company, one of whom must be the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company, that meets the requirements of Section 10.4
hereof.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 10.5 hereof.
The
13
counsel may be an employee of or counsel to the Company, any Subsidiary of the
Company or the Trustee.
"Other Permitted Indebtedness" means: (i) Indebtedness of the Company and
its Restricted Subsidiaries existing as of the date of original issuance of the
Senior Notes and all related Obligations as in effect on such date (including
the Senior Notes and the Discount Notes); (ii) Indebtedness of the Company and
its Restricted Subsidiaries in respect of bankers acceptances and letters of
credit (including, without limitation, letters of credit in respect of workers'
compensation claims) issued in the ordinary course of business, or other
Indebtedness in respect to reimbursement-type obligations regarding workers'
compensation claims; (iii) Refinancing Indebtedness, provided that: (A) the
principal amount of such Refinancing Indebtedness shall not exceed the
outstanding principal amount of Indebtedness (including unused commitments) so
extended, refinanced, renewed, replaced, substituted or refunded plus any
amounts incurred to pay premiums, fees and expenses in connection therewith, (B)
the Refinancing Indebtedness shall have a Weighted Average Life to Maturity
equal to or greater than the Weighted Average Life to Maturity of the
Indebtedness being extended, refinanced, renewed, replaced, substituted or
refunded; and (C) in the case of Refinancing Indebtedness of Subordinated
Indebtedness, such Refinancing Indebtedness shall be subordinated to the Senior
Notes at least to the same extent as the Subordinated Indebtedness being
extended, refinanced, renewed, replaced, substituted or refunded; (iv) inter-
company Indebtedness of and among the Company and its Restricted Subsidiaries
(excluding guarantees by Restricted Subsidiaries of Indebtedness of the Company
not issued in compliance with Section 4.15); (v) Indebtedness of the Company and
its Restricted Subsidiaries incurred in making permitted Restricted Payments
under Section 4.5(b)(iv), (v) and (viii); (vi) Indebtedness of any Non-
Restricted Subsidiary created after the date of original issuance of the Senior
Notes, provided that such Indebtedness is nonrecourse to the Company and its
Restricted Subsidiaries and neither the Company nor any of its Restricted
Subsidiaries have any Obligations with respect to such Indebtedness; (vii)
Indebtedness of the Company and its Restricted Subsidiaries under Hedging
Obligations; (viii) Indebtedness of the Company and its Restricted Subsidiaries
arising from the honoring by a bank
14
or other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts, which will not be, and
will not be deemed to be, inadvertent) drawn against insufficient funds in the
ordinary course of business; (ix) Indebtedness of any Person at the time it is
acquired as a Restricted Subsidiary, provided that such Indebtedness was not
issued by such Person in connection with or in anticipation of such acquisition
and that such Indebtedness is nonrecourse to the Company and any other
Restricted Subsidiary and the Company and such other Restricted Subsidiaries
have no Obligations with respect to such Indebtedness; (x) guarantees by
Restricted Subsidiaries of Indebtedness of any Restricted Subsidiary if the
Indebtedness so guaranteed is permitted under the Indenture; (xi) guarantees by
a Restricted Subsidiary of Indebtedness of the Company if the Indebtedness so
guaranteed is permitted under the Indenture and the Senior Notes are guaranteed
by such Restricted Subsidiary to the extent required by Section 4.15; (xii)
guarantees by the Company of Indebtedness of any Restricted Subsidiary if the
Indebtedness so guaranteed is permitted under the Indenture; (xiii) Indebtedness
of the Company and its Restricted Subsidiaries in connection with performance,
surety, statutory, appeal or similar bonds in the ordinary course of business;
and (xiv) Indebtedness of the Company and its Restricted Subsidiaries in
connection with agreements providing for indemnification, purchase price
adjustments and similar obligations in connection with the sale or disposition
of any of their business, properties or assets.
"Permitted Liens" means:
(a) with respect to the Company and the Restricted Subsidiaries, (i)
Liens for taxes, assessments, governmental charges or claims which are being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted and if a reserve or other appropriate provision, if any, as
shall be required in conformity with GAAP shall have been made therefor; (ii)
statutory Liens of landlords and carriers, warehousemen's, mechanics',
suppliers', materialmen's, repairmen's or other like Liens arising in the
ordinary course of business and with respect to amounts not yet delinquent or
being contested in good faith by appropriate proceedings, if a reserve or other
appropriate provision, if any
15
as shall be required in conformity with GAAP shall have been made therefor;
(iii) Liens incurred on deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other types of
social security; (iv) Liens incurred on deposits made to secure the performance
of tenders, bids, leases, statutory obligations, surety and appeal bonds,
government contracts, performance and return of money bonds and other
obligations of a like nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money); (v) easements,
rights-of-way, zoning or other restrictions, minor defects or irregularities in
title and other similar charges or encumbrances not interfering in any material
respect with the business of the Company or any of its Restricted Subsidiaries
incurred in the ordinary course of business; (vi) Liens (including extensions,
renewals and replacements thereof) upon property acquired (the "Acquired
Property") after the date of original issuance of the Senior Notes, provided
that: (A) any such Lien is created solely for the purpose of securing
Indebtedness representing, or issued to finance, refinance or refund, the cost
(including the cost of construction) of the Acquired Property, (B) the principal
amount of the Indebtedness secured by such Lien does not exceed 100% of the cost
of the Acquired Property, (C) such Lien does not extend to or cover any property
other than the Acquired Property and any improvements on such Acquired Property,
and (D) the issuance of the Indebtedness to purchase the Acquired Property is
permitted by Section 4.7; (vii) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods; (viii) judgment and attachment Liens
not giving rise to an Event of Default; (ix) leases or subleases granted to
others not interfering in any material respect with the business of the Company
or any of its Restricted Subsidiaries; (x) Liens securing Indebtedness under
Hedging Obligations; (xi) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual or warranty requirements of the
Company or its Restricted Subsidiaries; (xii) Liens arising out of consignment
or similar arrangements for the sale of goods entered into by the Company or its
Restricted Subsidiaries in the ordinary course of business; (xiii) any interest
or title of a lessor in property subject to any capital lease obligation or
operating lease; (xiv) Liens arising from filing Uniform Commercial
16
Code financing statements regarding leases; (xv) Liens existing on the date of
original issuance of the Senior Notes and any extensions, renewals or
replacements thereof; (xvi) any Lien granted to the Trustee and any
substantially equivalent Lien granted to any trustee or similar institution
under any indenture for Senior Indebtedness; and (xvii) additional Liens at any
one time outstanding in respect of properties or assets the aggregate fair
market value of which does not exceed $10,000,000 (the fair market value to be
determined on the date such Lien is granted on such properties or assets);
(b) with respect to the Restricted Subsidiaries, (i) Liens securing
Restricted Subsidiaries' reimbursement Obligations with respect to letters of
credit that encumber documents and other property relating to such letters of
credit and the products and proceeds thereof; (ii) Liens securing Indebtedness
issued by Restricted Subsidiaries if such Indebtedness is (A) under the New
Credit Agreement, or (B) permitted by Section 4.7(a), clauses (i), (ii), (iii)
or (iv) of Section 4.7(b), or clauses (i), (iii) (to the extent the
Indebtedness subject to such Refinancing Indebtedness was subject to Liens),
(vii),(ix) or (x) of the definition of Other Permitted Indebtedness; (iii) Liens
securing intercompany Indebtedness issued by any Restricted Subsidiary to the
Company or another Restricted Subsidiary; and (iv) Liens securing guarantees by
Restricted Subsidiaries of Indebtedness issued by the Company if such
guarantees are permitted by clause (xi) (but only in respect of the property,
rights and assets of the Restricted Subsidiaries issuing such guarantees) of
the definition of Other Permitted Indebtedness;
(c) with respect to the Company, (i) Liens securing Indebtedness issued by
the Company under the New Credit Agreement if such Indebtedness is permitted by
Section 4.7 (including, but not limited to, Indebtedness issued by the Company
under the New Credit Agreement pursuant to clause (i) and/or clause (iv) of
Section 4.7(b)); (ii) Liens securing Indebtedness of the Company if such
Indebtedness is permitted by clauses (i), (iii) (to the extent the Indebtedness
subject to such Refinancing Indebtedness was subject to Liens) or (vii) of the
definition of Other Permitted Indebtedness; (iii) Liens securing guarantees by
the Company of Indebtedness issued
17
by Restricted Subsidiaries if such Indebtedness is permitted by Section 4.7
(including, but not limited to, Indebtedness issued by Restricted Subsidiaries
under the New Credit Agreement pursuant to clause (i) and/or clause (v) of
Section 4.7(b)) and if such guarantees are permitted by clause (xii) (but only
in respect of Indebtedness issued by the Restricted Subsidiaries under the New
Credit Agreement pursuant to Section 4.7) of the definition of Other Permitted
Indebtedness; and (iv) Liens securing the Company's reimbursement obligations
with respect to letters of credit that encumber documents and other property
relating to such letters of credit and the products and proceeds thereof;
provided, however, that, notwithstanding any of the foregoing, the Permitted
Liens referred to in clause (c) of this definition shall not include any Lien on
Capital Stock of Restricted Subsidiaries held directly by the Company (as
distinguished from Liens on Capital Stock of Restricted Subsidiaries held by
other Restricted Subsidiaries) other than Liens securing (A) Indebtedness of
the Company issued under the New Credit Agreement pursuant to Section 4.7 and
any permitted Refinancing Indebtedness of such Indebtedness, and (B) guarantees
by the Company of Indebtedness issued by Restricted Subsidiaries under the
Credit Agreement or the New Credit Agreement pursuant to Section 4.7 and any
permitted Refinancing Indebtedness of such Indebtedness.
"Person" means any individual, corporation, partnership, joint venture,
limited liability company, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Pro Forma Basis" means, for purposes of determining Consolidated Net
Income, Cash Flow and Consolidated Interest Expense in connection with the Cash
Flow Coverage Ratio (including in connection with Section 4.5, the incurrence
of Indebtedness pursuant to Section 4.7(a) and Consolidated Net Worth for
purposes of Section 5.1), giving pro forma effect to (x) any acquisition or sale
of a Person, business or asset, related incurrence, repayment or refinancing of
Indebtedness or other related transactions, including any related restructuring
charges in respect of restructurings, consolidations, compensation or headcount
reductions or other cost savings which
18
would otherwise be accounted for as an adjustment permitted by Regulation S-X
under the Securities Act or on a pro forma basis under GAAP, or (y) any
incurrence, repayment or refinancing of any Indebtedness and the application
of the proceeds therefrom, in each case, as if such acquisition or sale and
related transactions, restructurings, consolidations, cost savings, reductions,
incurrence, repayment or refinancing were realized on the first day of the
relevant period permitted by Regulation S-X under, the Securities Act or on a
pro forma basis under GAAP. Furthermore, in calculating the Cash Flow Coverage
Ratio, (1) interest on outstanding Indebtedness determined on a fluctuating
basis as of the determination date and which will continue to be so determined
thereafter shall be deemed to have accrued at a fixed rate per annum equal to
the rate of interest on such Indebtedness in effect on the determination date;
(2) if interest on any Indebtedness actually incurred on the determination date
may optionally be determined at an interest rate based upon a factor of a prime
or similar rate, a eurocurrency interbank offered rate, or other rates, then the
interest rate in effect on the determination date will be deemed to have been in
effect during the relevant period; and (3) notwithstanding clause (1) above,
interest on Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by agreements relating to interest rate swaps or similar
interest rate protection Hedging Obligations, shall be deemed to accrue at the
rate per annum resulting after giving effect to the operation of such
agreements.
"Properties Services Agreement" means the services agreement, dated July
25, 1997, between the Company and Jordan Industries, Inc., as in effect on the
date of original issuance of the Senior Notes.
"Purchasers" means Xxxxxxxxx & Company, Inc., Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation and Xxxxx Xxxxxx Inc.
"Receivables" means, with respect to any Person, all of the following
property and interests in property of such Person, whether now existing or
existing in the future or hereafter acquired or arising: (i) accounts, (ii)
accounts receivable (including, without limitation, all rights to payment
created by or arising from sales of goods, leases of goods or leased or the
rendition of
19
services rendered no matter how evidenced, whether or not earned by
performance), (iii) all unpaid seller's or lessor's rights (including, without
limitation, recession, replevin, reclamation and stoppage in transit, relating
to any of the foregoing or arising therefrom), (iv) all rights to any goods or
merchandise represented by any of the foregoing (including, without limitation,
returned or repossessed goods), (v) all reserves and credit balances with
respect to any such accounts receivable or account debtors, (vi) all letters of
credit, security or guarantees for any of the foregoing, (vii) all insurance
policies or reports relating to any of the foregoing, (viii) all collection or
deposit accounts relating to any of the foregoing, (ix) all proceeds of any of
the foregoing, and (x) all books and records relating to any of the foregoing.
"Receivables Financing" means (i) the sale or other disposition of
Receivables arising in the ordinary course of business, or (ii) the sale or
other disposition of Receivables arising in the ordinary course of business to a
Receivables Subsidiary followed by a financing transaction in connection with
such sale or disposition of such Receivables.
"Receivables Subsidiary" means a Subsidiary of the Company that is
exclusively engaged in Receivables Financings and activities reasonably related
thereto.
"Refinancing Indebtedness" means (i) Indebtedness of the Company and its
Restricted Subsidiaries issued or given in exchange for, or the proceeds of
which are used to, extend, refinance, renew, replace, substitute or refund any
Indebtedness permitted under this Indenture or any Indebtedness issued to so
extend, refinance, renew, replace, substitute or refund such Indebtedness, (ii)
any refinancings of Indebtedness issued under the New Credit Agreement, and
(iii) any additional Indebtedness issued to pay premiums and fees in connection
with clauses (i) and (ii).
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of July 25, 1997, by and among the Company and the Purchasers, with
respect to the Senior Notes.
20
"Restricted Investment" means any Investment in any Person, provided that
Restricted Investments will not include: (i) Investments in marketable
securities and other negotiable instruments to the extent permitted by Section
4.5(b)(ii) of this Indenture; (ii) any Incentive Arrangements; (iii) Investments
by any Restricted Subsidiary in the Company; or (iv) Investments by the Company
or any Restricted Subsidiary in any Restricted Subsidiary (provided that any
Investment in a Restricted Subsidiary was made for fair market value (as
determined by the Board of Directors in good faith). The amount of any
Restricted Investment shall be the amount of cash and the fair market value at
the time of transfer of all other property (as determined by the Board of
Directors in good faith) initially invested or paid for such Restricted
Investment, plus all additions thereto, without any adjustments for increases or
decreases in value of, or write-ups, write-downs or write-offs with respect to,
such Restricted Investment.
"Restricted Subsidiary" means: (i) any Subsidiary of the Company existing
on the date of original issuance of the Senior Notes, and (ii) any other
Subsidiary of the Company formed, acquired or existing after the date of
original issuance of the Senior Notes that is designated as a "Restricted
Subsidiary" by the Company pursuant to a resolution approved by a majority of
the Board of Directors, provided, however, that the term "Restricted
Subsidiary" shall not include (A) any Restricted Subsidiary of the Company that
has been redesignated by the Company pursuant to a resolution approved by a
majority of the Board of Directors as a Non-Restricted Subsidiary in accordance
with Section 4.16 unless such Subsidiary shall have subsequently been
redesignated a Restricted Subsidiary or (B) any Restricted Subsidiary of the
Company that is organized under the laws of a foreign jurisdiction and whose
stock or ownership interests are sold or transferred to a Non-Restricted
Subsidiary of the Company pursuant to one or more transactions that comply with
Sections 4.8 and 4.14 which is, at or after the time of such sale or transfer,
by a resolution approved by a majority of the Board of Directors, designated a
Non-Restricted Subsidiary.
"Restructuring Charges" means any charges or expenses in respect of
restructuring or consolidating any business, operations or facilities, any
compensation or
21
headcount reduction, or any other cost savings, of any Persons or businesses
either alone or together with the Company or any Restricted Subsidiary, as
permitted by GAAP or Regulation S-X under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means: (i) all Obligations (including any interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on any Indebtedness of the
Company, whether outstanding on the date of issuance of the Senior Notes or
thereafter created, incurred or assumed, of the following types: (A) all
Indebtedness of the Company (including without limitation the Senior Notes) for
money borrowed, and (B) all Indebtedness evidenced by notes, debentures, bonds
or other similar instruments for the payment of which the Company is responsible
or liable; (ii) all capitalized lease obligations of the Company; (iii) all
Obligations of the Company: (A) for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction, (B)
constituting Hedging Obligations, or (C) issued as the deferred purchase price
of property and all conditional sale Obligations of the Company and all
Obligations of the Company under any title retention agreement; (iv) all
guarantees of the Company with respect to Obligations of other Persons of the
type referred to in clauses (ii) and (iii) and with respect to the payment of
dividends of other Persons; and (v) all Obligations of the Company consisting of
modifications, renewals, extensions, replacements and refundings of any
Obligations described in clauses (i), (ii), (iii) or (iv) unless, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is expressly provided that such Obligations are subordinated or
junior in right of payment to the Senior Notes; provided, however, that Senior
Indebtedness shall not be deemed to include: (1) any Obligation of the Company
to any Subsidiary, (2) any liability for federal, state, local or other taxes
owed or owing by the Company, (3) any accounts payable or other liability to
trade creditors arising in the ordinary course of business (includ-
22
ing guarantees thereof or instruments evidencing such liabilities), (4) any
Indebtedness, guarantee or Obligation of the Company that is contractually
subordinated or junior in any respect to any other Indebtedness, guarantee or
Obligation of the Company, or (5) any Indebtedness to the extent the same is
incurred in violation of the Indenture. Senior Indebtedness shall include all
Obligations in respect of the Senior Notes and the Indenture.
"Senior Notes" means the Series A Notes and the Series B Notes.
"Series A Notes" means the Company's 9-7/8% Series A Notes due 2007.
"Series B Notes" means the Company's 9-7/8% Series B Notes due 2007.
"SFAS 106" means Statement of Financial Accounting Standards No. 106.
"SFAS 109" means Statement of Financial Accounting Standards No. 109.
"Significant Subsidiary" means (i) any Restricted Subsidiary of the Company
that would be a "significant subsidiary" as defined in clause (2) of the
definition of such term in Rule 1-02 of Regulation S-X under the Securities Act
and the Exchange Act, and (ii) any other Restricted Subsidiary of the Company
that is material to the business, earnings, prospects, assets or condition,
financial or otherwise, of the Company and its Restricted Subsidiaries, taken as
a whole.
"Subordinated Indebtedness" means all Obligations of the type referred to
in clauses (i) through (v) of the definition of Senior Indebtedness, if the
instrument creating or evidencing the same, or pursuant to which the same is
outstanding, designates such Obligations as subordinated or junior in right of
payment to Senior Indebtedness.
"Stated Maturity" means with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not
23
include any contingent obligations to repay, redeem or repurchase any such
interest or principal prior to the date originally scheduled for the payment
thereof.
"Subsidiary" of any Person means any entity of which the Equity Interests
entitled to cast at least a majority of the votes that may be cast by all Equity
Interests having ordinary voting power for the election of directors or other
governing body of such entity are owned by such Person (regardless of whether
such Equity Interests are owned directly by such Person or through one or more
Subsidiaries).
"Tax Sharing Agreement" means the tax sharing agreement between the Company
and each of its Subsidiaries and Jordan Industries, Inc. and each of the other
direct and indirect Subsidiaries of Jordan Industries, Inc. that are
consolidated with Jordan Industries, Inc. for Federal income tax purposes, as in
effect on the date of original issuance of the Senior Notes.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
77aaa-77bbbb), as amended, as in effect on the date of original issuance of the
Senior Notes.
"Transition Agreement" means the transition agreement, dated as of July 25,
1997, between the Company and Jordan Industries, as in effect on the date of
original issuance of the Senior Notes.
"Transfer Restricted Senior Notes" means securities that bear or are
required to bear the legend set forth in Section 2.6.
"Trustee" means First Trust National Association until a successor replaces
it in accordance with the applicable provisions of this Indenture, and
thereafter means the successor.
"U.S. Government Obligations" means direct obligations of the United States
of America for the payment of which the full faith and credit of the United
States of America is pledged, provided that no U.S. Government Obligation shall
be callable at the issuer's option.
"Voting Stock" means any class or classes of Capital Stock pursuant to
which the holders thereof have the
24
general voting power under ordinary circumstances to elect the board of
directors.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the then outstanding
principal amount of such Indebtedness into (ii) the sum of the product(s)
obtained by multiplying (a) the amount of each then remaining installment,
sinking fund, serial maturity or other required payment of principal, including
payment at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) which will elapse between such date and
the making of such payment.
SECTION 1.2 OTHER DEFINITIONS.
Defined in
Term Section
"Affiliate Transaction.................................................. 4.8
"Asset Sale Disposition Date"........................................... 4.14
"Asset Sale Trigger Date"............................................... 4.14
"covenant defeasance option"............................................ 8.1
"Disposition"........................................................... 5.1
"DTC"................................................................... 2.3
"Event of Default"...................................................... 6.1
"Excess Proceeds"....................................................... 4.14
"legal defeasance option"............................................... 8.1
"Notice of Default"..................................................... 6.1
"Offer"................................................................. 3.8
"Other Indebtedness".................................................... 4.15
"Other Company Indebtedness Guarantee".................................. 4.15
"Paying Agent".......................................................... 2.3
"Purchase Date"......................................................... 3.8
"Registrar"............................................................. 2.3
"Restricted Payments"................................................... 4.5
"Successor Corporation"................................................. 5.1
"Trustee Expenses"...................................................... 6.8
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in, and made a part of, this Indenture. Any terms
incorporated by reference in this Indenture that are defined by the
25
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them therein.
SECTION 1.4 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein;
(2) an accounting term not otherwise defined
herein has the meaning assigned to it under GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in
the plural include the singular; and
(5) provisions apply to successive events and transactions.
ARTICLE 2
THE SENIOR NOTES
SECTION 2.1 FORM AND DATING.
The Senior Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is part of this Indenture. The
Senior Notes may have notations, legends or endorsements required by law, stock
exchange rule or usage. Each Senior Note shall be dated the date of its
authentication. The Senior Notes shall be in denominations of $1,000 and
integral multiples thereof.
The terms and provisions contained in the Senior Notes shall constitute,
and are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
26
Each Global Senior Note shall represent such of the outstanding Senior
Notes as shall be specified therein and each shall provide that it shall
represent the aggregate amount of outstanding Senior Notes from time to time
endorsed thereon and that the aggregate amount of outstanding Senior Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Senior Note to reflect the amount of any increase or decrease in the amount of
outstanding Senior Notes represented thereby shall be made by the Trustee or the
Senior Note Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.6.
SECTION 2.2 EXECUTION AND AUTHENTICATION.
One Officer shall sign the Senior Notes for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Senior Notes
and may be in facsimile form.
If an Officer whose signature is on a Senior Note no longer holds that
office at the time a Senior Note is authenticated, the Senior Note shall
nevertheless be valid.
A Senior Note shall not be valid until authenticated by the manual
signature of an authorized signatory of the Trustee, and the Trustee's signature
shall be conclusive evidence that the Senior Note has been authenticated under
this Indenture. The form of Trustee's certificate of authentication to be borne
by the Senior Notes shall be substantially as set forth in Exhibit A.
The Trustee shall, upon a written order of the Company signed by two
Officers directing the Trustee to authenticate the Senior Notes and certifying
that all conditions precedent to the issuance of the Senior Notes contained
herein have been complied with, authenticate Senior Notes for original issuance
up to an aggregate principal amount stated in paragraph 4 of the Senior Notes
(the aggregate principal amount of outstanding Senior Notes may not exceed that
amount at any time, except as provided in Section 2.7).
27
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Senior Notes. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Senior Notes whenever the Trustee may
do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with the Company or an Affiliate of the Company.
SECTION 2.3 REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency (the "Registrar") where
Senior Notes may be presented for registration of transfer or for exchange and
an office or agency (the "Paying Agent") where Senior Notes may be presented for
payment. The Registrar shall keep a register of the Senior Notes and of their
transfer and exchange. The Company may appoint one or more co-registrars and
one or more additional paying agents. The term "Registrar" includes any co-
registrar, and the term "Paying Agent" includes any additional paying agent. The
Company may change any Paying Agent or Registrar without prior notice to any
Holder. The Company shall notify in writing the Trustee and the Trustee shall
notify the Holders in writing of the name and address of any Agent not a party
to this Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company shall
enter into an appropriate agency agreement with any Agent not a party to this
Indenture, and such agreement shall incorporate the TIA's provisions and
implement the provisions of this Indenture that relate to such Agent.
The Company initially appoints The Depository Trust Company ("DTC") to act
as Depositary with respect to the Global Senior Notes.
The Company initially appoints the Trustee as Registrar, Paying Agent and
agent for service of notices and demands in connection with the Senior Notes and
as Senior Note Custodian with respect to the Global Senior Notes. The Company or
any of its Subsidiaries may act as Paying Agent, Registrar or co-registrar. If
the Company fails to appoint or maintain a Registrar and Paying Agent, the
Trustee shall act as such, and shall be entitled to appropriate compensation in
accordance with Section 7.7.
28
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the Holders' benefit or
the Trustee all money the Paying Agent holds for redemption or purchase of the
Senior Notes or for the payment of principal of, or premium, if any, or interest
on, or Liquidated Damages, if any, with respect to the Senior Notes, and will
promptly notify the Trustee of any Default by the Company in providing the
Paying Agent with sufficient funds to (i) purchase Senior Notes tendered
pursuant to an Offer arising under Section 4.13, (ii) redeem Senior Notes called
for redemption, or (iii) make any payment of principal, premium, interest or
Liquidated Damages due on the Senior Notes. While any such Default continues,
the Trustee may require the Paying Agent to pay all money it holds to the
Trustee and to account for any funds disbursed. The Company at any time may
require the Paying Agent to pay all money it holds to the Trustee and to account
for any funds disbursed. Upon payment over to the Trustee, the Paying Agent (if
other than the Company or any of its Subsidiaries) shall have no further
liability for the money it delivered to the Trustee. If the Company or any of
its Subsidiaries acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the Holders' benefit or the Trustee all money it holds as Paying
Agent.
SECTION 2.5 HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA section 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require that sets forth the names and addresses of, and
the aggregate principal amount of Senior Notes held by, each Holder, and the
Company shall otherwise comply with section 312(a) of the TIA.
29
SECTION 2.6 TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Definitive Senior Notes. When
Definitive Senior Notes are presented by a Holder to the Registrar with a
request:
(x) to register the transfer of the Definitive Senior Notes; or
(y) to exchange such Definitive Senior Notes for an equal principal
amount of Definitive Senior Notes of other authorized
denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, however, that the
Definitive Senior Notes presented or surrendered for register of transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing;
and
(ii) in the case of a Definitive Senior Note that is a Transfer
Restricted Senior Note, such request shall be accompanied by the following
additional information and documents, as applicable:
(A) if such Transfer Restricted Senior Note is being delivered
to the Registrar by a Holder for registration in the name of
such Holder, without transfer, a certification to that
effect from such Holder (in substantially the form of
Exhibit B hereto); or
(B) if such Transfer Restricted Senior Note is being transferred
(1) to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A
under the Securities Act or (2) pursuant to an exemption
from regis-
30
tration in accordance with Rule 144 under the Securities Act
(and based on an opinion of counsel if the Company so
requests) or (3) pursuant to an effective registration
statement under the Securities Act, a certification to that
effect from such Holder (in substantially the form of
Exhibit B hereto); or
(C) if such Transfer Restricted Senior Note is being transferred
to an institutional "accredited investor," within the
meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act pursuant to a private placement exemption
from the registration requirements of the Securities Act
(and based on an opinion of counsel if the Company so
requests), a certification to that effect from such Holder
(in substantially the form of Exhibit B hereto) and a
certification from the applicable transferee (in
substantially the form of Exhibit C hereto); or
(D) if such Transfer Restricted Senior Note is being transferred
in reliance on another exemption from the registration
requirements of the Securities Act (and based on an opinion
of counsel if the Company so requests), a certification to
that effect from such Holder (in substantially the form of
Exhibit B hereto).
(b) Transfer of a Definitive Senior Note for a Beneficial Interest in
a Global Senior Note. A Definitive Senior Note may not be exchanged for a
beneficial interest in a Global Senior Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive Senior
Note, duly endorsed or accompanied by appropriate instruments of transfer, in
form satisfactory to the Trustee, together with:
31
(i) if such Definitive Senior Note is a Transfer Restricted Senior
Note, a certification from the Holder thereof (in substantially the form of
Exhibit B hereto) to the effect that such Definitive Senior Note is being
transferred by such Holder to a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) in accordance with Rule 144A under
the Securities Act; and
(ii) whether or not such Definitive Senior Note is a Transfer
Restricted Senior Note, written instructions from the Holder thereof
directing the Trustee to make, or to direct the Senior Note Custodian to
make, an endorsement on the Global Senior Note to reflect an increase in
the aggregate principal amount of the Senior Notes represented by the
Global Senior Note,
the Trustee shall cancel such Definitive Senior Note in accordance with Section
2.11 and cause, or direct the Senior Note Custodian to cause, in accordance with
the standing instructions and procedures existing between the Depositary and the
Senior Note Custodian, the aggregate principal amount of Senior Notes
represented by the Global Senior Note to be increased accordingly. If no Global
Senior Notes are then outstanding, the Company shall issue and, upon receipt of
an authentication order in accordance with Section 2.2, the Trustee shall
authenticate a new Global Senior Note in the appropriate principal amount.
(c) Transfer and Exchange of Global Senior Notes. The transfer and
exchange of Global Senior Notes or beneficial interests therein shall be
effected through the Depositary, in accordance with this Indenture and the
procedures of the Depositary therefor, which shall include restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act.
(d) Transfer of a Beneficial Interest in a Global Senior Note for a
Definitive Senior Note.
(i) Any Person having a beneficial interest in a Global Senior
Note may upon request exchange such beneficial interest for a Definitive
Senior Note. Upon receipt by the Trustee of written
32
instructions or such other form of instructions as is customary for the
Depositary, from the Depositary or its nominee on behalf of any Person
having a beneficial interest in a Global Senior Note, and, in the case of a
Transfer Restricted Senior Note, the following additional information and
documents (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred to the
Person designated by the Depositary as being the beneficial
owner, a certification to that effect from such Person (in
substantially the form of Exhibit B hereto); or
(B) if such beneficial interest is being transferred (1) to a
"qualified institutional buyer" (as defined in Rule 144A
under the Securities Act) in accordance with Rule 144A under
the Securities Act or (2) pursuant to an exemption from
registration in accordance with Rule 144 under the Securities
Act (and based on an opinion of counsel if the Company so
requests) or (3) pursuant to an effective registration
statement under the Securities Act, a certification to that
effect from the transferor (in substantially the form of
Exhibit B hereto); or
(C) if such beneficial interest is being transferred to an
institutional "accredited investor," within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act
pursuant to a private placement exemption from the
registration requirements of the Securities Act (and based on
an opinion of counsel if the Company so requests), a
certification to that effect from such Holder (in
substantially the form of Exhibit B hereto) and a
certification from the applica-
33
ble transferee (in substantially the form of Exhibit C
hereto); or
(D) if such beneficial interest is being transferred in reliance
on another exemption from the registration requirements of
the Securities Act (and based on an opinion of counsel if
the Company so requests), a certification to that effect
from such Holder (in substantially the form of Exhibit B
hereto).
The Trustee or the Senior Note Custodian, at the direction of the
Trustee, shall, in accordance with the standing instructions and
procedures existing between the Depositary and the Senior Note
Custodian, cause the aggregate principal amount of Global Senior
Notes to be reduced accordingly and, following such reduction,
the Company shall execute and, upon receipt of an authentication
order in accordance with Section 2.2 hereof, the Trustee shall
authenticate and deliver to the transferee a Definitive Senior
Note in the appropriate principal amount.
(ii) Definitive Senior Notes issued in exchange for a beneficial
interest in a Global Senior Note pursuant to this Section 2.6(d) shall be
registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall
deliver in accordance with the standard procedures of the Depositary such
Definitive Senior Notes to the Persons in whose names such Senior Notes are
so registered.
(e) Restrictions on Transfer and Exchange of Global Senior Notes.
Notwithstanding any other provision of this Indenture (other than the provisions
set forth in subsection (f) of this Section 2.6), a Global Senior Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the
34
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
(f) Authentication of Definitive Senior Notes in Absence of
Depositary. If at any time:
(i) the Depositary for the Senior Notes notifies the Company that
the Depositary is unwilling or unable to continue as Depositary for the
Global Senior Notes and a successor Depositary for the Global Senior Notes
is not appointed by the Company within 90 days after delivery of such
notice; or
(ii) The Company, at its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of Definitive Senior Notes
under this Indenture,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.2, authenticate and deliver,
Definitive Senior Notes in an aggregate principal amount equal to the principal
amount of the Global Senior Notes in exchange for such Global Senior Notes and
registered in such names as the Depositary shall instruct the Trustee or the
Company in writing.
(g) Legends.
(i) Except for any Transfer Restricted Senior Note sold or
transferred (including any Transfer Restricted Senior Note represented by a
Global Senior Note) as described in (ii) below, each Senior Note
certificate evidencing Global Senior Notes and Definitive Senior Notes (and
all Senior Notes issued in exchange therefor or substitution thereof) shall
bear legends in substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX
XXX XXXXXX XXXXXX SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND
THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
35
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY
IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) INSIDE THE
UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, OR (c) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON
AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY
OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted Senior
Note (including any Transfer Restricted Senior Note represented by a Global
Senior Note) pursuant to an effective registration statement under the
Securities Act, pursuant to Rule 144 under the Securities Act or pursuant
to an opinion of counsel reasonably satisfactory to the Company and the
Registrar that no legend is required:
(A) in the case of any Transfer Restricted Senior Note that is a
Definitive Senior Note, the Registrar shall permit the Holder
thereof to exchange such Transfer Restricted Senior Note for
a Definitive Senior Note that does not bear the legend set
forth in
36
(i) above and rescind any restriction on the transfer of
such Transfer Restricted Senior Note; and
(B) in the case of any Transfer Restricted Senior Note
represented by a Global Senior Note, such Transfer
Restricted Senior Note shall not be required to bear the
legend set forth in (i) above if all other interests in such
Global Senior Note have been or are concurrently being sold
or transferred pursuant to Rule 144 under the Securities Act
or pursuant to an effective registration statement under the
Securities Act, but such Transfer Restricted Senior Note
shall continue to be subject to the provisions of Section
2.6(c); provided, however, that with respect to any request
for an exchange of a Transfer Restricted Senior Note that is
represented by a Global Senior Note for a Definitive Senior
Note that does not bear the legend set forth in (i) above,
which request is made in reliance upon Rule 144, the Holder
there of shall certify in writing to the Registrar that such
request is being made pursuant to Rule 144 (such
certification to be substantially in the form of Exhibit B
hereto).
(iii) Notwithstanding the foregoing, upon consummation of the
Exchange Offer, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.2, the Trustee shall
authenticate, Series B Senior Notes in exchange for Series A Senior Notes
accepted for exchange in the Exchange Offer, which Series B Senior Notes
shall not bear the legend set forth in (i) above, and the Registrar shall
rescind any restriction on the transfer of such Senior Notes, in each case
unless the Holder of such Series A Senior Notes is either (A) a broker-
dealer, (B) a Person participating in the distribution of the Series A
Senior Notes or (C) a Person who is an affiliate (as de-
37
fined in Rule 144A) of the Company. The Company shall identify to the
Trustee such Holders of the Senior Notes in a written certification signed
by an Officer of the Company and, absent certification from the Company to
such effect, the Trustee shall assume that there are no such Holders.
(h) Cancellation and/or Adjustment of Global Senior Notes. At such
time as all beneficial interests in Global Senior Notes have been exchanged for
Definitive Senior Notes, redeemed, repurchased or cancelled, all Global Senior
Notes shall be returned to or retained and cancelled by the Trustee in
accordance with Section 2.11. At any time prior to such cancellation, if any
beneficial interest in a Global Senior Note is exchanged for Definitive Senior
Notes, redeemed, repurchased or cancelled, the principal amount of Senior Notes
represented by such Global Senior Note shall be reduced accordingly and an
endorsement shall be made on such Global Senior Note, by the Trustee or the
Senior Notes Custodian, at the direction of the Trustee, to reflect such
reduction.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Definitive Senior
Notes and Global Senior Notes at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or "exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 3.7, 4.13, 4.14 and 9.5).
(iii) Neither the Company nor the Registrar shall be required to
register the transfer of or exchange any Senior Note selected for
redemption in whole or in part, except the unredeemed portion of any Senior
Note being redeemed in part.
(iv) All Definitive Senior Notes and Global Senior Notes issued
upon any registration of
38
transfer or exchange of Definitive Senior Notes or Global Senior Notes in
accordance with this Indenture (including any increase in the aggregate
principal amount of the Senior Notes represented by the Global Senior Note
pursuant to subsection (b) above) shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Definitive Senior Notes or Global Senior Notes
surrendered upon such registration of transfer or exchange.
(v) The Company shall not be required to issue Senior Notes and
the Registrar shall not be required to register the transfer of or to
exchange Senior Notes during a period beginning at the opening of business
15 days before the day of any selection of Senior Notes for redemption
under Section 3.2 and ending at the close of business on the day of
selection, or to register the transfer of or to exchange a Senior Note
between a record date and the next succeeding interest payment date.
(vi) Prior to due presentment for the registration of a transfer
of any Senior Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Senior Note is registered as the
absolute owner of such Senior Note for the purpose of receiving payment of
principal of, premium, if any, accrued and unpaid interest, and Liquidated
Damages, if any, on such Senior Notes, and neither the Trustee, any Agent
nor the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive Senior Notes and
Global Senior Notes in accordance with the provisions of Section 2.2.
SECTION 2.7 REPLACEMENT SENIOR NOTES.
If any mutilated Senior Note is surrendered to the Trustee, or the Company
and the Trustee receive evidence to their satisfaction of the destruction, loss
or theft of any Senior Note, the Company shall issue and the Trustee, upon the
Company's written order signed by two Officers, shall authenticate a replacement
Senior Note if the Trustee's requirements are met. If the Trustee or the
Company requires it, the Holder must supply an indem-
39
nity bond that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent or any authenticating agent from any
loss that any of them may suffer if a Senior Note is replaced. The Company and
the Trustee may charge for their expenses in replacing a Senior Note. Every
replacement Senior Note is an additional Obligation of the Company.
SECTION 2.8 OUTSTANDING SENIOR NOTES.
------------------------
The Senior Notes outstanding at any time are all the Senior Notes the
Trustee has authenticated except for those it has cancelled, those delivered to
it for cancellation, those representing reductions in the interest in a Global
Senior Note effected by the Trustee in accordance with the provisions hereof,
and those described in this Section as not outstanding.
If a Senior Note is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that a bona
fide purchaser holds the replaced Senior Note.
If the entire principal of, and premium, if any, and accrued interest on,
and Liquidated Damages, if any, with respect to any Senior Note is considered
paid under Section 4.1, it ceases to be outstanding and interest and Liquidated
Damages on it cease to accrue.
Subject to Section 2.9, a Senior Note does not cease to be outstanding
because the Company or an Affiliate holds the Senior Note.
SECTION 2.9 TREASURY SENIOR NOTES.
---------------------
In determining whether the Holders of the required principal amount of
Senior Notes have concurred in any direction, waiver or consent, Senior Notes
owned by the Company or an Affiliate 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
Senior Notes that a Trust Officer of the Trustee knows are so owned shall be so
disregarded. Notwithstanding the foregoing, Senior Notes that the Company or an
Affiliate offers to purchase or acquires pursuant to an Offer, exchange offer,
tender
40
offer or otherwise shall not be deemed to be owned by the Company or an
Affiliate until legal title to such Senior Notes passes to the Company or such
Affiliate, as the case may be.
SECTION 2.10 TEMPORARY SENIOR NOTES.
----------------------
Until Definitive Senior Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Senior Notes. Temporary
Senior Notes shall be substantially in the form of Definitive Senior Notes but
may have variations that the Company considers appropriate for temporary Senior
Notes. Without unreasonable delay, the Company shall prepare and the Trustee,
upon receipt of the Company's written order signed by two Officers which shall
specify the amount of temporary Senior Notes to be authenticated and the date on
which the temporary Senior Notes are to be authenticated, shall authenticate
Definitive Senior Notes and deliver them in exchange for temporary Senior Notes.
Until such exchange, Holders of temporary Senior Notes shall be entitled to the
same rights, benefits and privileges as Definitive Senior Notes.
SECTION 2.11 CANCELLATION.
------------
The Company at any time may deliver Senior Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Senior Notes surrendered to them for registration of transfer, exchange,
replacement, payment (including all Senior Notes called for redemption and all
Senior Notes accepted for payment pursuant to an Offer) or cancellation, and the
Trustee shall cancel all such Senior Notes and shall destroy all cancelled
Senior Notes (subject to the Exchange Act's record retention requirements) and
deliver a certificate of their destruction to the Company unless by written
order, signed by two Officers of the Company, the Company shall direct that
cancelled Senior Notes be returned to it. The Company may not issue new Senior
Notes to replace any Senior Notes that have been cancelled by the Trustee or
that have been delivered to the Trustee for cancellation. If the Company or an
Affiliate acquires any Senior Notes (other than by redemption or pursuant to an
Offer), such acquisition shall not operate as a redemption or satisfaction of
the Indebtedness represented by such Senior Notes unless and until such
41
Senior Notes are delivered to the Trustee for cancellation.
SECTION 2.12 DEFAULTED INTEREST.
------------------
If the Company defaults in a payment of interest on the Senior Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to Holders on a subsequent
special record date, in each case at the rate provided in the Senior Notes. The
Company shall fix or cause to be fixed each such special record date and payment
date. As early as practicable prior to the special record date, the Company (or
the Trustee, in the name of and at the expense of the Company) shall mail a
notice that states the special record date, the related payment date and the
amount of interest to be paid.
SECTION 2.13 RECORD DATE.
-----------
The record date for purposes of determining the identity of Holders of
Senior Notes entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in section 316(c) of the TIA.
SECTION 2.14 CUSIP NUMBER.
------------
A "CUSIP" number shall be printed on the Senior Notes, and the Trustee
shall use the CUSIP number in notices of redemption, purchase or exchange as a
convenience to Holders, provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Senior Notes and that reliance may be placed
only on the other identification numbers printed on the Senior Notes. The
Company shall promptly notify the Trustee of any change in the CUSIP number.
42
ARTICLE 3
OPTIONAL REDEMPTION AND
MANDATORY OFFERS TO PURCHASE
SECTION 3.1 NOTICES TO TRUSTEE.
------------------
If the Company elects to redeem Senior Notes pursuant to Section 3.7,
it shall furnish to the Trustee, at least 40 days prior to the redemption date
and at least 10 days prior to the date that notice of the redemption is to be
mailed by the Company to Holders, an Officers' Certificate stating that the
Company has elected to redeem Senior Notes pursuant to Section 3.7(a) or 3.7(b),
as the case may be, the date notice of redemption is to be mailed to Holders,
the redemption date, the aggregate principal amount of Senior Notes to be
redeemed, the redemption price for such Senior Notes and the amount of accrued
and unpaid interest on and Liquidated Damages, if any, with respect to such
Senior Notes as of the redemption date. If the Trustee is not the Registrar, the
Company shall, concurrently with delivery of its notice to the Trustee of a
redemption, cause the Registrar to deliver to the Trustee a certificate (upon
which the Trustee may rely) setting forth the name of, and the aggregate
principal amount of Senior Notes held by, each Holder.
If the Company is required to offer to purchase Senior Notes pursuant
to Section 4.13 or 4.14, it shall furnish to the Trustee, at least 2 Business
Days before notice of the Offer is to be mailed to Holders, an Officers'
Certificate setting forth that the Offer is being made pursuant to Section 4.13
or 4.14, as the case may be, the Purchase Date, the maximum principal amount of
Senior Notes the Company is offering to purchase pursuant to the Offer, the
purchase price for such Senior Notes, and the amount of accrued and unpaid
interest on and Liquidated Damages, if any, with respect to such Senior Notes as
of the Purchase Date.
The Company will also provide the Trustee with any additional
information that the Trustee reasonably requests in connection with any
redemption or Offer.
43
SECTION 3.2 SELECTION OF SENIOR NOTES TO BE REDEEMED OR PURCHASED.
-----------------------------------------------------
If less than all outstanding Senior Notes are to be redeemed or if
less than all Senior Notes tendered pursuant to an Offer are to be accepted for
payment, the Trustee shall select the outstanding Senior Notes to be redeemed or
accepted for payment pro rata, by lot or by a method that complies with the
requirements of any stock exchange on which the Senior Notes are listed and that
the Trustee considers fair and appropriate. If the Company elects to mail notice
of a redemption to Holders, the Trustee shall at least 5 business days prior to
the date notice of redemption is to be mailed, (i) select the Senior Notes to be
redeemed from Senior Notes outstanding not previously called for redemption and
(ii) notify the Company of the names of each Holder of Senior Notes selected for
redemption, the principal amount of Senior Notes held by each such Holder and
the principal amount of such Holder's Senior Notes that are to be redeemed. If
less than all Senior Notes tendered pursuant to an Offer on the Purchase Date
are to be accepted for pay ment, the Trustee shall select on or promptly after
the Purchase Date the Senior Notes to be accepted for payment. The Trustee
shall select for redemption or purchase Senior Notes or portions of Senior
Notes in principal amounts of $1,000 or integral multiples of $1,000; except
that if all of the Senior Notes of a Holder are selected for redemption or
purchase, the aggregate principal amount of the Senior Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except
as provided in the preceding sentence, provisions of this Indenture that apply
to Senior Notes called for redemption or tendered pursuant to an offer also
apply to portions of Senior Notes called for redemption or tendered pursuant to
an Offer. The Trustee shall notify the Company promptly of the Senior Notes or
portions of Senior Notes to be called for redemption or selected for purchase.
SECTION 3.3 NOTICE OF REDEMPTION.
--------------------
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail a notice of redemption to each Holder of Senior Notes or
portions thereof that are to be redeemed.
44
The notice shall identify the Senior Notes or portions thereof to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price for the Senior Notes and separately stating
the amount of unpaid and accrued interest on, and Liquidated Damages, if any,
with respect to, such Senior Notes as of the date of redemption;
(3) if any Senior Note is being redeemed in part, the portion of the
principal amount of such Senior Notes to be redeemed and that, after the
redemption date, upon surrender of such Senior Note, a new Senior Note or
Senior Notes in principal amount equal to the unredeemed portion will be issued;
(4) the name and address of the Paying Agent;
(5) that Senior Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price for, and any accrued and unpaid
interest on, and Liquidated Damages, if any, with respect to such Senior Notes;
(6) that, unless the Company defaults in making such redemption
payment, interest on Senior Notes called for redemption ceases to accrue on and
after the redemption date;
(7) the paragraph of the Senior Notes pursuant to which the Senior
Notes called for redemption are being redeemed; and
(8) the CUSIP number; provided that no representation is made as to
the correctness or accuracy of the CUSIP number listed in such notice and
printed on the Senior Notes.
45
At the Company's request, the Trustee shall (at the Company's expense)
give the notice of redemption in the Company's name at least 30 but not more
than 60 days before a redemption; provided, however, that the Company shall
deliver to the Trustee, at least 45 days prior to the redemption date and at
least 10 days prior to the date that notice of the redemption is to be mailed to
Holders, an Officers' Certificate that (i) requests the Trustee to give notice
of the redemption to Holders, (ii) sets forth the information to be provided to
Holders in the notice of redemption, as set forth in the preceding paragraph,
(iii) states that the Company has elected to redeem Senior Notes pursuant to
Section 3.7(a) or 3.7(b), as the case may be, and (iv) sets forth the aggregate
principal amount of Senior Notes to be redeemed and the amount of accrued and
unpaid interest and Liquidated Damages, if any, thereon as of the redemption
date. If the Trustee is not the Registrar, the Company shall, concurrently with
any such request, cause the Registrar to deliver to the Trustee a certificate
(upon which the Trustee may rely) setting forth the name of, the address of, and
the aggregate principal amount of Senior Notes held by, each Holder.
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION.
------------------------------
Once notice of redemption is mailed, Senior Notes called for
redemption become due and payable on the redemption date at the price set forth
in the Senior Note. Upon surrender to the Trustee or Paying Agent, such Senior
Notes called for redemption shall be paid at the redemption price (which shall
include accrued interest thereon to the redemption date) but installments of
interest, the maturity of which is on or prior to the redemption date, shall be
payable to Holders of record at the close of business on the relevant record
dates.
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE.
---------------------------
On or prior to any redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price
of, and accrued interest on, and Liquidated Damages, if any, with respect to all
Senior Notes to be redeemed on that date. The Trustee or the Paying Agent shall
return to the Company any money that the Company deposited with the Trustee or
the Paying Agent in excess of the amounts
46
necessary to pay the redemption price of, and accrued interest on, and
Liquidated Damages, if any, with respect to all Senior Notes to be redeemed.
If the Company complies with the preceding paragraph, interest on the
Senior Notes to be redeemed will cease to accrue on such Senior Notes on the
applicable redemption date, whether or not such Senior Notes are presented for
payment. If a Senior Note is redeemed on or after an interest record date but
on or prior to the related interest payment date, then any accrued and unpaid
interest and Liquidated Damages, if any, shall be paid to the Person in whose
name such Senior Note was registered at the close of business on such record
date. If any Senior Note called for redemption shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest will be paid on the unpaid principal, premium,
if any, interest and Liquidated Damages, if any, from the redemption date until
such principal, premium, interest and Liquidated Damages, if any, is paid, at
the rate of interest provided in the Senior Notes and Section 4.1.
SECTION 3.6 SENIOR NOTES REDEEMED IN PART.
-----------------------------
Upon surrender of a Senior Note that is redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder at the Company's
expense a new Senior Note equal in principal amount to the unredeemed portion
of the Senior Note surrendered.
SECTION 3.7 OPTIONAL REDEMPTION PROVISIONS.
------------------------------
(a) Except as provided in Section 3.7(b), the Senior Notes may not be
redeemed at the option of the Company prior to August 1, 2002. During the
twelve (12) month period beginning on August 1 of the years indicated below, the
Senior Notes will be redeemable at the option of the Company, in whole or in
part, on at least 30 but not more than 60 days' notice to each Holder of Senior
Notes to be redeemed, at the redemption prices (expressed as percentages of the
principal amount) set forth below, plus any accrued and unpaid interest and
Liquidated Damages, if any, from August 1, 2000 to the redemption date:
47
Year Percentage
---- ----------
2002................................ 104.9375%
2003................................ 102.4688%
2004 and thereafter................. 100.000 %
(b) Notwithstanding the foregoing, at any time on or prior to August
1, 2000, the Company may (but shall not have the obligation to) redeem up to
one-third of the original aggregate principal amount of the Senior Notes with
the proceeds of one or more Equity Offerings at a redemption price of 109.875%
of the principal amount thereof, plus any accrued and unpaid interest and
Liquidated Damages, if any, to the date of redemption; provided that at least
$126,666,667 of the aggregate principal amount of the Senior Notes originally
issued remain out standing immediately after any such redemption; and provided,
further, that any such redemption shall occur within 60 days of the date of the
closing of any such Equity Offering.
SECTION 3.8 MANDATORY PURCHASE PROVISIONS.
-----------------------------
(a) Within 30 days following any Change of Control or Asset Sale
Trigger Date, the Company shall mail a notice to each Holder at such Holder's
registered address stating (i) that an offer ("Offer") is being made pursuant to
Section 4.13 or Section 4.14, as the case may be, the length of time the Offer
shall remain open, the amount of the Offer and the maximum aggregate principal
amount of Senior Notes that will be accepted for payment pursuant to such Offer;
(ii) the purchase price for the Senior Notes (as set forth in Section 4.13 or
Section 4.14, as the case may be), the amount of accrued and unpaid interest on,
and Liquidated Damages, if any, with respect to, such Senior Notes as of the
purchase date, and the purchase date (which shall be no earlier than 30 days or
later than 40 days from the date such notice is mailed (the "Purchase Date"));
(iii) that any Senior Note not accepted for payment will continue to accrue
interest and Liquidated Damages, if any; (iv) that, unless the Company fails to
deposit with the Paying Agent on the Purchase Date an amount sufficient to
purchase all Senior Notes accepted for payment, interest shall cease to accrue
on such Senior Notes after the Purchase Date; (v) that Holders electing to
tender any Senior Note or por-
48
tion thereof will be required to surrender their Senior Note, with a form
entitled "Option of Holder to Elect Purchase" completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the
Business Day preceding the Purchase Date, provided that Holders electing to
tender only a portion of any Senior Note must tender a principal amount of
$1,000 or integral multiples thereof; (vi) that Holders will be entitled to
withdraw their election to tender Senior Notes, if the Paying Agent receives,
not later than the close of business on the third Business Day preceding the
Purchase Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of Senior Notes delivered for
purchase, and a statement that such Holder is withdrawing his election to have
such Senior Note purchased; and (vii) that Holders whose Senior Notes are
accepted for payment in part will be issued new Senior Notes equal in principal
amount to the unpurchased portion of Senior Notes surrendered; provided that
only Senior Notes in a principal amount of $1,000 or integral multiples thereof
will be accepted for payment in part.
(b) On any Purchase Date, the Company shall, to the extent lawful and
required by this Indenture and such Offer, (i) in the case of an Offer resulting
from a Change of Control, accept for payment all Senior Notes or portions
thereof tendered pursuant to such Offer and, in the case of an Offer resulting
from an Asset Sale Trigger Date, accept for payment the maximum aggregate
principal amount of Senior Notes or portions thereof tendered pursuant to such
Offer that can be purchased out of Excess Proceeds from such Asset Sale Trigger
Date, (ii) deposit with the Paying Agent the aggregate purchase price of all
Senior Notes or portions thereof accepted for payment and any accrued and unpaid
interest and Liquidated Damages, if any, on such Senior Notes as of the Purchase
Date, and (iii) deliver or cause to be delivered to the Trustee all Senior Notes
so accepted together with an Officers' Certificate stating the Senior Notes or
portions thereof tendered to the Company.
(c) With respect to any Offer, if less than all of the Senior Notes
tendered pursuant to an Offer are to be purchased by the Company, the Trustee
shall select on the Purchase Date the Senior Notes or portions thereof to be
accepted for payment pursuant to Section 3.2.
49
(d) Promptly after consummation of an Offer, (i) the Paying Agent
shall mail (or cause to be transferred by book entry) to each Holder of Senior
Notes or portions thereof accepted for payment an amount equal to the purchase
price for, plus any accrued and unpaid interest on, and Liquidated Damages, if
any, with respect to such Senior Notes as of the Purchase Date, (ii) with
respect to any tendered Senior Note not accepted for pay payment in whole or in
part, the Trustee shall return such Senior Note to the Holder thereof, and (iii)
with respect to any Senior Note accepted for payment in part, the Trustee shall
authenticate and mail to each such Holder a new Senior Note equal in principal
amount to the unpurchased portion of the tendered Senior Note, provided that
each such new Senior Note shall be in a principal amount of $1,000 or integral
multiples thereof.
(e) The Company will publicly announce the results of the Offer on or
as soon as practicable after the Purchase Date.
(f) The Company shall comply with Rule 14e-1 under the Exchange Act
and any other securities laws and regulations to the extent such laws and
regulations are applicable to any Offer. To the extent that the provision of
any of the securities laws or regulations con conflict with provisions of this
Indenture, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Indenture by virtue thereof.
(g) With respect to any Offer, if the Company deposits prior to 10:00
a.m. New York City time with the Paying Agent on the Purchase Date an amount in
available funds sufficient to purchase all Senior Notes accepted for payment,
interest shall cease to accrue on such Senior Notes after the Purchase Date;
provided, however, that if the Company fails to deposit such amount on the
Purchase Date, interest shall continue to accrue on such Senior Notes until such
deposit is made.
50
ARTICLE 4
COVENANTS
SECTION 4.1 PAYMENT OF SENIOR NOTES.
-----------------------
The Company shall pay the principal of, and premium, if any, and
accrued and unpaid interest on the Senior Notes on the dates and in the manner
provided in the Senior Notes. Holders of Senior Notes must surrender their
Senior Notes to the Paying Agent to collect principal pal payments. Principal
of, premium, if any, and accrued and unpaid interest, and Liquidated Damages, if
any, shall be considered paid on the date due if the Paying Agent (other than
the Company or any of its Subsidiaries ), the Global Senior Note Holder or each
Holder that has specified an account, holds, as of 10:00 a.m. New York City
time, money the Company deposited in immediately available funds designated for
and sufficient to pay in cash all principal, premium, if any, and accrued and
unpaid interest on, and Liquidated Damages, if any, then due; provided that, to
the extent that the Holders have not specified accounts, such amounts shall be
considered paid on the date due if the Company mails a check for such amounts on
such date. The Paying Agent shall return to the Company, no later than five days
following the date of payment, any money (including accrued interest) that
exceeds the amount of principal, premium, if any, accrued and unpaid interest,
and Liquidated Damages, if any, paid on the Senior Notes. The Company shall pay
all Liquidated Damages, if any, in the same manner on the dates and in the
amounts set forth in the Registration Rights Agreement. If any Liquidated
Damages become payable, the Company shall not later than three Business Days
prior to the date that any payment of Liquidated Damages is due (i) deliver an
Officers' Certificate to the Trustee setting forth the amount of Liquidated
Damages payable to Holders and (ii) instruct the Paying Agent to pay such amount
of Liquidated Damages to Holders entitled to receive such Liquidated Damages.
To the extent lawful, the Company shall pay interest (including Post-
Petition Interest) on (i) overdue principal and premium at the then applicable
interest rate on the Senior Notes, compounded semiannually and (ii) over due
installments of interest and Liquidated Damages (without regard to any
applicable grace period) at the
51
same rate as set forth in clause (i), compounded semiannually.
To the extent any payment on the Senior Notes, whether by or on behalf of
the Company, as proceeds of security or enforcement of any right of setoff or
otherwise, is declared to be fraudulent or preferential, set aside or required
to be paid to a trustee, receiver or other similar party under any bankruptcy,
insolvency, receivership or similar law, then if such payment is recovered by,
or paid over to, such trustee, receiver or other similar party, the Senior Notes
or part thereof originally intended to be satisfied by such payment shall be
deemed to be reinstated and outstanding as if such payment had not occurred.
SECTION 4.2 SEC REPORTS.
-----------
(a) The Company shall file with the Trustee, within 15 days after it
files them with the SEC, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) that the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the
Company is not subject to the requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall file with the Trustee, within 15 days after it
would have been required to file with the SEC, financial statements, including
any notes thereto (and with respect to annual reports, an auditor's report by a
firm of established national reputation), and a "Management's Discussion and
Analysis of Financial Condition and Results of Operations," both comparable to
that which the Company would have been required to include in such annual
reports, information, documents or other reports if the Company were subject to
the requirements of Section 13 or 15(d) of the Exchange Act. Subsequent to the
qualification of this Indenture under the TIA, the Company also shall comply
with the provisions of section 314(a) of the TIA.
(b) If the Company is required to furnish annual or quarterly reports
to its stockholders pursuant to the Exchange Act, the Company shall cause any
annual report furnished to its stockholders generally and any quarterly or other
financial reports it furnishes to its stockholders generally to be filed with
the Trustee and
52
the Company shall mail to the Holders at their addresses appearing in the
register of Senior Notes maintained by the Registrar. If the Company is not
required to furnish annual or quarterly reports to its stockholders pursuant to
the Exchange Act, the Company shall cause its financial statements referred to
in Section 4.2(a), including any notes thereto (and with respect to annual
reports, an auditors' report by a firm of established national reputation), and
a "Management's Discussion and Analysis of Financial Condition and Results of
Operations," to be so mailed to the Holders within 120 days after the end of
each of the Company's fiscal years and within 60 days after the end of each of
the first three fiscal quarters of each year. The Company shall cause to be
disclosed in a statement accompanying any annual report or comparable
information as of the date of the most recent financial statements in each such
report or comparable information the amount available for payments pursuant to
Section 4.5. As of the date hereof, the Company's fiscal year ends on December
31.
(c) If the Company is not subject to the requirements of Section 13
or 15(d) of the Exchange Act, for so long as any Senior Notes remain
outstanding, the Company shall furnish to the Holders, securities analysts and
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(d) Notwithstanding anything herein to the contrary, the Trustee
shall have no duty to review such documents for purposes of determining their
compliance with any provision of this Indenture.
SECTION 4.3 COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determine whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that, to the best of
his or her knowledge, the Company has kept, observed, performed and fulfilled
each and
53
every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions hereof
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company has taken or proposes to take with respect thereto) and that,
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of, premium,
if any, and accrued and unpaid interest on, and Liquidated Damages, if any, with
respect to the Senior Notes are prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the financial statements
delivered pursuant to Section 4.2 shall be accompanied by a written statement
of the Company's independent public accountants (who shall be a firm of
established national reputation reasonably satisfactory to the Trustee) that in
making the examination necessary for certification of such financial statements
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Section 4.1, 4.5, 4.6, 4.7, 4.8, 4.9, 4.
10, 4.11, 4.12, 4.13, 4.14, 4.15 or 4.16 or of Article 5 or, if any such
violation has occurred, specifying the nature and period of existence thereof,
it being understood that such accountants shall not be liable directly or
indirectly to any Person for any failure to obtain knowledge of any such
violation.
The Company shall, so long as any of the Senior Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
SECTION 4.4 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law
54
wherever enacted, now or at any time hereafter in force, that might affect the
covenants or the performance of this Indenture; and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
has been enacted.
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 or make
any distribution on account of the Company's or such Restricted Subsidiary's
Capital Stock or other Equity Interests (other than dividends or distributions
payable in Capital Stock or other Equity Interests (other than Disqualified
Stock) of the Company or a Restricted Subsidiary and other than dividends or
distributions payable by a Restricted Subsidiary to another Restricted
Subsidiary or to the Company); (ii) purchase, redeem or other wise acquire or
retire for value any Equity Interests of the Company or any of its Restricted
Subsidiaries (other than any such Equity Interest purchased from the Company or
any Restricted Subsidiary for fair market value (as determined by the Board of
Directors in good faith)); (iii) voluntarily prepay Subordinated Indebtedness,
whether any such Subordinated Indebtedness is outstanding on, or issued after,
the date of original issuance of the Senior Notes, except as specifically
permitted by the covenants of this Indenture; or (iv) make any Restricted
Investment (all such dividends, distributions, purchases, redemptions,
acquisitions, retirements, prepayments and Restricted Investments being
collectively referred to as "Restricted Payments"), if, at the time of such
Restricted Payment:
(A) a Default or Event of Default shall have occurred and be
continuing or shall occur as a consequence thereof; or
(B) immediately after such Restricted Payment and after giving effect
thereto on a Pro Forma Basis, the Company shall not be able
55
to issue $1.00 of additional Indebtedness pursuant to Section
4.7(a); or
(C) such Restricted Payment, together with the aggregate of all other
Restricted Payments made after the date of original issuance of
the Senior Notes, without duplication, exceeds the sum of: (1)
50% of the aggregate Consolidated Net Income (including, for
this purpose, gains from Asset Sales and, to the extent not
included in Consolidated Net Income, any gain from a sale or
disposition of a Restricted Investment) of the Company (or, in
case such aggregate is a loss, 100% of such loss) for the period
(taken as one accounting period) from the beginning of the first
fiscal quarter commencing immediately after the date of original
issuance of the Senior Notes and ended as of the Company's most
recently ended fiscal quarter at the time of such Restricted
Payment, plus (2) 100% of the aggregate net cash proceeds and the
fair market value of any property or securities (as determined by
the Board of Directors in good faith) received by the Company
from the issue or sale of Capital Stock or other Equity Interests
of the Company subsequent to the date of original issuance of
the Senior Notes (other than (x) Capital Stock or other Equity
Interests issued or sold to a Restricted Subsidiary and (y) the
issuance or sale of Disqualified Stock), plus (3) $5,000,000,
plus (4) the amount by which the principal amount of and any
accrued interest on either (A) Senior Indebtedness of the
Company, or (B) any Indebtedness of the Restricted Subsidiaries
is reduced on the Company's consolidated balance sheet upon the
conversion or exchange subsequent to the date of original
issuance of the Senior Notes of any such Indebtedness of the
Company or any Restricted Subsidiary (not held by the Company or
any Restricted Subsidiary) for Capital Stock or other Equity
Interests (other than Disqualified Stock) of the
56
Company or any Restricted Subsidiaries (less the amount of any
cash, or the fair market value of any other property or
securities (as determined by the Board of Directors in good
faith), distributed by the Company or any Restricted Subsidiary
(to Persons other than the Company or any other Restricted
Subsidiary) upon such conversion or exchange), plus (5) if any
Non-Restricted Subsidiary is redesignated as a Restricted
Subsidiary, the value of the deemed Restricted Payment resulting
therefrom and determined in accordance with the second sentence
of Section 4.16; provided, however, that for purposes of this
clause (5), the value of any redesignated Non-Restricted
Subsidiary shall be reduced by the amount that any such
redesignation replenishes or increases the amount of Restricted
Investments permitted to be made pursuant to Section 4.5(b)(ii).
(b) Notwithstanding Section 4.5(a), the following Restricted
Payments may be made: (i) the payment of any dividend within 60 days after the
date of declaration thereof, if at said date of declaration such payment would
comply with all the provisions hereof (including, but not limited to, this
Section 4.5); (ii) making Restricted Investments at any time, and from time to
time, in an aggregate outstanding amount of $40,000,000 after the date of
original issuance of the Senior Notes (it being understood that if any
Restricted Investment made after the date of original issuance of the Senior
Notes pursuant to this Section 4.5(b)(ii) is sold, transferred or otherwise
conveyed to any Person other than the Company or a Restricted Subsidiary, the
portion of the net cash proceeds or fair market value of securities or
properties paid or transferred to the Company and its Restricted Subsidiaries in
connection with such sale, transfer or conveyance that relates or corresponds to
the repayment or return of the original cost of such a Restricted Investment
will replenish or increase the amount of Restricted Investments permitted to be
made pursuant to this clause (ii), so that up to $40,000,000 of Restricted
Investments may be outstanding under this Section 4.5(b)(ii) at any given time;
provided that without otherwise limiting this clause (ii) any Restricted In-
57
vestment in a Restricted Subsidiary made pursuant to this Section 4.5(b)(ii) is
made for fair market value (as determined by the Board of Directors in good
faith); (iii) the repurchase, redemption or acquisition of the Company's stock
from the executives, management and employees or consultants of the Company or
its Subsidiaries pursuant to the terms of any subscription, stockholder or
other agreement or plan, up to an aggregate amount not to exceed $5,000,000;
(iv) any loans, advances, distributions or payments from the Company to its
Restricted Subsidiaries, or any loans, advances, distributions or payments by a
Restricted Subsidiary to the Company or to another Restricted Subsidiary,
pursuant to intercompany Indebtedness, intercompany management agreements,
intercompany tax sharing agreements and other intercompany agreements and
obligations; (v) the purchase, redemption, retirement or other acquisition of
(A) any Senior Indebtedness of the Company and any Indebtedness of a Restricted
Subsidiary required by its terms to be purchased, redeemed, retired or acquired
with the net proceeds from asset sales (as defined in the instrument evidencing
such Indebtedness) or upon a change of control (as defined in the instrument
evidencing such Indebtedness) and (B) the Senior Notes pursuant to Sections
3.7, 4.13 and 4.14; (vi) dividends and redemptions in respect of the Dura-Line
Preferred Stock pursuant to the Dura-Line Agreement; (vii) to the extent
constituting Restricted Payments, payments under the Tax Sharing Agreement, New
Subsidiary Consulting Agreement, Transition Agreement and the Properties
Services Agreement; (viii) to the extent constituting Restricted Payments, (A)
payments under the New Subsidiary Advisory Agreement, provided that such
payments will not be made and shall be accrued so long as any Default or Event
of Default shall have occurred and be continuing or shall occur as a consequence
thereof, and the Company's Obligations to pay such fees under the New Subsidiary
Advisory Agreement shall be subordinated expressly to the Company's Obligations
in respect of the Senior Notes, and (B) indemnities, expenses and other amounts
under the New Subsidiary Advisory Agreement; (ix) the redemption, repurchase,
retirement or the acquisition of any Capital Stock or other Equity Interests of
the Company or any Restricted Subsidiary in exchange for, or out of the proceeds
of, the substantially concurrent sale (other than to a Subsidiary of the
Company) of other Capital Stock or other Equity Interests of the Company or any
Restricted Subsid-
58
iary (other than any Disqualified Stock); provided that any net cash proceeds
that are utilized for any such redemption, repurchase, retirement or other
acquisition, and any Net Income resulting therefrom, shall be excluded from this
Section 4.5(a)(iv)(c) (1) and (c)(2); (x) the defeasance, redemption or
repurchase of Indebtedness with the net cash proceeds from an issuance of
permitted Refinancing Indebtedness or the substantially concurrent sale (other
than to a Subsidiary of the Company) of Capital Stock or other Equity Interests
of the Company or any Restricted Subsidiary (other than Disqualified Stock);
provided that any net cash proceeds that are utilized for any such defeasance,
redemption or repurchase, and any Net Income resulting therefrom, shall be
excluded from this Section 4.5(a)(iv)(c)(1) and (c)(2); (xi) payments of fees,
expenses and indemnities in respect of the Company's and its Subsidiaries'
directors and such payments to Jordan Industries, Inc., an Illinois corporation
and corporate parent of the Company, in respect of their directors, provided
that the aggregate amount of such fees payable to all such directors does not
exceed $250,000 in any fiscal year; (xii) Restricted Investments received in
consideration for the sale, transfer or disposition by the Company or any
Restricted Subsidiary of any business, properties or assets belonging thereto,
provided that the Company complies with Section 4.14; (xiii) any Restricted
Investment constituting securities or instruments of a Person issued in
exchange for trade or other claims against such Person in connection with a
financial reorganization or restructuring of such Person; (xiv) to the extent
constituting Restricted Payments, payments and transactions in connection with
the Offering or the Company Formation; or (xv) any Restricted Investment
constituting an equity investment in a Receivables Subsidiary, provided that
the aggregate amount of such equity investments does not exceed $1,000,000.
SECTION 4.6 CORPORATE EXISTENCE.
Subject to Section 4.14 and 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 Restricted Subsidiaries in accordance with the respective
organizational documents of each of its Restricted Subsidiaries and the rights
(char-
59
ter and statutory), licenses and franchises of the Company and each of
its Restricted Subsidiaries; provided, however, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any Restricted Subsidiary, if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and its Restricted Subsidiaries
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders.
SECTION 4.7 LIMITATION ON INCURRENCE OF INDEBTEDNESS.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, issue any Indebtedness (other than the Indebtedness represented
by the Senior Notes and the Discount Notes) unless the Company's Cash Flow
Coverage Ratio for its four full fiscal quarters next preceding the date such
additional Indebtedness is issued would have been at least 2.0 to 1 determined
on a Pro Forma Basis.
(b) Section 4.7(a) shall not apply to the issuance of (i)
Indebtedness of the Company and/or its Restricted Subsidiaries as measured on
such date of issuance in an aggregate principal amount outstanding on any such
date of issuance not exceeding up to the greater of (A) $110,000,000 aggregate
principal amount pursuant to the New Credit Agreement and (B) an aggregate
principal amount up to the sum of: (1) 85% of the book value of the Company's
and its Restricted Subsidiaries' Receivables on a consolidated basis and (2) 65%
of the book value of the Company's and its Restricted Subsidiaries' inventories
on a consolidated basis; (ii) Indebtedness of the Company and its Restricted
Subsidiaries pursuant to any Receivables Financing; (iii) Indebtedness of the
Company and its Restricted Subsidiaries in connection with capital leases, sale
and leaseback transactions, purchase money obligations, capital expenditures or
similar financing transactions relating to: (A) their properties, assets and
rights as of the date of original issuance of the Senior Notes up to $20,000,000
in aggregate principal amount or (B) their properties, assets and rights
acquired after the date of original issuance of the Senior Notes, provided that
the aggregate principal amount of such Indebtedness under this Section
4.7(b)(iii)(B) does
60
not exceed 100% of the cost of such properties, assets and rights; (iv)
additional Indebtedness of the Company and its Restricted Subsidiaries in an
aggregate principal amount up to $25,000,000 (all or any portion of which may be
issued as additional Indebtedness under the New Credit Agreement); and (v) Other
Permitted Indebtedness.
(c) Notwithstanding Sections 4.7(a) and (b), no Restricted Subsidiary
shall under any circumstances issue a guarantee of any Indebtedness of the
Company except for guarantees issued by Restricted Subsidiaries pursuant to
Section 4.15, provided, however, that the foregoing will not limit or restrict
guarantees issued by Restricted Subsidiaries in respect of Indebtedness of other
Restricted Subsidiaries.
SECTION 4.8 LIMITATION ON TRANSACTIONS WITH AFFILIATES.
(a) Except as otherwise set forth herein, neither the Company nor
any of its Restricted Subsidiaries shall make any loan, advance, guarantee or
capital contribution to, or for the benefit of, or sell, lease, transfer or
dispose of any properties or assets to, or for the benefit of, or purchase or
lease any property or assets from, or enter into or amend any contract,
agreement or understanding with, or for the benefit of, an Affiliate (each such
transaction or series of related transactions that are part of a common plan, an
"Affiliate Transaction"), except in good faith and on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than those that
would have been obtained in a comparable transaction on an arm's length basis
from an unrelated Person.
(b) The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any Affiliate Transactions involving aggregate
payments or other transfers by the Company and its Restricted Subsidiaries in
excess of $5,000,000 (including cash and non-cash payments and benefits valued
at their fair market value by the Board of Directors in good faith), unless the
Company delivers to the Trustee: (i) a resolution of the Board of Directors
stating that the Board of Directors (including a majority of the disinterested
directors, if any) has, in good faith, determined that such Affiliate
Transaction complies with the provisions of this Indenture; and (ii)(A) with
respect to any Affiliate Transaction involv-
61
ing the incurrence of Indebtedness, a written opinion of a nationally recognized
investment banking or accounting firm experienced in the review of similar types
of transactions, (B) with respect to any Affiliate Transaction involving the
transfer of real property, fixed assets or equipment, either directly or by a
transfer of 50% or more of the Capital Stock of a Restricted Subsidiary which
holds any such real property, fixed assets or equipment, a written appraisal
from a nationally recognized appraiser experienced in the review of similar
types of transactions or (C) with respect to any Affiliate Transaction not
otherwise described in (A) or (B) above, or in lieu of the opinions and
appraisals referred to in (A) and (B) above, a written certification from a
nationally recognized professional or firm experienced in evaluating similar
types of transactions, in each case, stating that the terms of such transaction
are fair to the Company or such Restricted Subsidiary, as the case may be, and
the Holders of the Senior Notes from a financial point of view.
(c) Notwithstanding Sections 4.8(a) and (b), this Section 4.8 shall
not apply to: (i) transactions between the Company and any Restricted
Subsidiary or between Restricted Subsidiaries; (ii) payments expressly due under
the New Subsidiary Advisory Agreement, the New Subsidiary Consulting Agreement,
the Transition Agreement, the Properties Services Agreement and the Tax Sharing
Agreement; provided that any amendments, supplements, modifications,
substitutions, renewals or replacements of the foregoing agreements are
approved by a majority of the Board of Directors (including a majority of
disinterested directors, if any) as fair to the Company and the Holders of the
Senior Notes; (iii) any Restricted Payments permitted pursuant to Section 4.5;
(iv) reasonable compensation paid to officers, employees or consultants of the
Company or any Subsidiary as determined in good faith by the Company's Board of
Directors or executives; (v) transactions in connection with a Receivables
Financing; or (vi) payments and transactions in connection with the Offering and
the Company Formation.
62
SECTION 4.9 LIMITATION ON LIENS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien (other than Permitted Liens) upon any property or asset now owned
or hereafter acquired by them, or any income or profits therefrom, or assign or
convey any right to receive income therefrom; provided, however, that in
addition to creating Permitted Liens on their properties or assets, the Company
and any of its Restricted Subsidiaries may create any Lien upon any of their
properties or assets (including, but not limited to, any Capital Stock of its
Subsidiaries) if the Senior Notes are equally and ratably secured.
SECTION 4.10 COMPLIANCE WITH LAWS, TAXES.
The Company shall, and shall cause each of its Restricted Subsidiaries
to, comply with all statutes, laws, ordinances, or government rules and
regulations to which it is subject, the non-compliance with which would
materially adversely affect the business, prospects, earnings, properties,
assets or condition, financial or otherwise, of the Company and its Restricted
Subsidiaries taken as a whole.
The Company shall, and shall cause each of its Restricted Subsidiaries
to, pay prior to delinquency all taxes, assessments and governmental levies,
except those contested in good faith by appropriate proceedings.
SECTION 4.11 LIMITATION ON DIVIDENDS AND OTHER PAYMENT RESTRICTIONS AFFECTING
RESTRICTED SUBSIDIARIES.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective, any encumbrance or restriction on the ability of any
Restricted Subsidiary to: (i) pay dividends or make any other distributions on
its Capital Stock or any other interest or participation in, or measured by,
its profits, owned by the Company or any Restricted Subsidiary, or pay any
Indebtedness owed to, the Company or any Restricted Subsidiary; (ii) make loans
or
63
advances to the Company; or (iii) transfer any of its properties or assets to
the Company, except for such encumbrances or restrictions existing under or by
reason of: (A) applicable law; (B) Indebtedness permitted (1) under Section
4.7(a), (2) under Sections 4.7(b)(i), (ii) and (iv) and clauses (i), (v), (vi),
(vii), (ix), (x), (xi), (xii) and (xiv) of the definition of Other Permitted
Indebtedness, or (3) Restricted Payments and agreements or instruments
evidencing the Restricted Payments permitted under Section 4.5; (C) customary
provisions restricting subletting or assignment of any lease or license of the
Company or any Restricted Subsidiary; (D) customary provisions of any franchise,
distribution or similar agreement; (E) any instrument governing Indebtedness or
any other encumbrance or restriction of a Person acquired by the Company or any
Restricted Subsidiary at the time of such acquisition, which encumbrance or
restriction is not applicable to any Person, or the properties or assets of any
Person, other than the Person, or the property or assets of the Person, so
acquired; (F) Indebtedness or other agreements existing on the date of original
issuance of the Senior Notes; (G) any Refinancing Indebtedness of Indebtedness
described in Sections 4.7(b)(i), (ii), (iii) and (iv) and clauses (i), (v),
(vi), (vii), (ix), (x), (xi), (xii) and (xiv) of the definition of Other
Permitted Indebtedness; provided that the encumbrances and restrictions created
in connection with such Refinancing Indebtedness are no more restrictive in any
material respect with regard to the interests of the Holders of Senior Notes
than the encumbrances and restrictions in the refinanced Indebtedness; (H) any
restrictions, with respect to a Restricted Subsidiary, imposed pursuant to an
agreement that has been entered into for the sale or disposition of the stock,
business, assets or properties of such Restricted Subsidiary; (I) the terms of
any Indebtedness of the Company incurred in connection with Section 4.7,
provided that the terms of such Indebtedness constitute no greater encumbrance
or restriction on the ability of any Restricted Subsidiary to pay dividends or
make distributions, make loans or advances or transfer properties or assets than
is otherwise permitted by this Section 4.11; and (J) the terms of purchase
money obligations, but only to the extent such purchase money obligations
restrict or prohibit the transfer of the property so acquired.
64
(b) Nothing contained in this Section 4.11 shall prevent the Company
from entering into any agreement or instrument providing for the incurrence of
Permitted Liens or restricting the sale or other disposition of property or
assets of the Company or any of its Restricted Subsidiaries that are subject to
Permitted Liens.
SECTION 4.12 MAINTENANCE OF OFFICE OR AGENCIES.
The Company shall maintain in the Borough of Manhattan, the City of New
York an office or an agency (which may be an office of any Agent) where Senior
Notes may be surrendered for registration of transfer or exchange and where
notices and demands to or upon the Company in respect of the Senior Notes and
this Indenture may be served. The Company shall give prompt written notice to
the Trustee of any change in the location of such office or agency. If at any
time the Company shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office.
The Company may also from time to time designate one or more other offices
or agencies where the Senior Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee
located at First Trust National Association, 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, as one such office or agency of the Company in accordance
with Section 2.3.
SECTION 4.13 CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder of
Senior Notes shall have the right to require the Company to purchase all or any
part (equal to
65
$1,000 or an integral multiple thereof) of such Holder's Senior Notes pursuant
to an Offer at a purchase price equal to 101% of the aggregate principal amount
thereof, plus any accrued and unpaid interest and Liquidated Damages, if any, to
the date of purchase. Although the failure of the Company to purchase all
Senior Notes tendered in such an Offer shall be a Default, if the Company is
unable to purchase all Senior Notes tendered in such an Offer, the Company shall
nevertheless purchase the maximum principal amount of Senior Notes that it is
able to purchase at that time.
(b) Prior to the mailing of the notice referred to in Section
3.8(a), but in any event within 30 days following any Change of Control, the
Company shall (i) repay in full and terminate all commitments under Indebtedness
under the New Credit Agreement and all other Senior Indebtedness the terms of
which require repayment upon a Change of Control or offer to repay in full and
terminate all commitments under all Indebtedness under the New Credit Agreement
and all such other Senior Indebtedness and to repay the Indebtedness owed to
each lender which has accepted such offer or (ii) obtain the requisite consents
under the New Credit Agreement and all such other Senior Indebtedness to permit
the repurchase of the Senior Notes as provided in Section 3.8(b). The Company
shall first comply with Section 4.13(b)(ii) before it shall be required to
repurchase Senior Notes pursuant to the provisions in Section 3.8. The
Company's failure to comply with this Section 4.13(b) shall constitute an Event
of Default described in clause (iii) and not in clause (ii) under Section
6.1(a).
(c) In the event of a Change of Control, the Company shall not offer
to purchase or redeem any Subordinated Indebtedness required or entitled by its
terms to be redeemed or purchased until the Change of Control Offer for the
Senior Notes has been consummated and all Senior Notes tendered pursuant to such
Offer have been accepted for payment.
SECTION 4.14 LIMITATION ON ASSET SALES.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, consummate an Asset Sale (including the
sale of any of the Capital Stock of any Restricted Subsidiary)
66
providing for Net Proceeds in excess of $2,500,000 unless at least 75% of the
Net Proceeds from such Asset Sale are applied (in any manner otherwise permitted
by this Indenture) to one or more of the following purposes in such combination
as the Company shall elect: (i) an investment in another asset or business in
the same line of business as, or a line of business similar to that of, the line
of business of the Company and its Restricted Subsidiaries at the time of the
Asset Sale; provided that such investment occurs on or prior to the 365th day
following the date of such Asset Sale (the "Asset Sale Disposition Date"), (ii)
to reimburse the Company or its Subsidiaries for expenditures made, and costs
incurred, to repair, rebuild, replace or restore property subject to loss,
damage or taking, to the extent that the Net Proceeds consist of insurance
proceeds received on account of such loss, damage or taking, (iii) the purchase,
redemption or other prepayment or repayment of outstanding Senior Indebtedness
of the Company or Indebtedness of the Company's Restricted Subsidiaries on or
prior to the 365th day following the Asset Sale Disposition Date or (iv) an
Offer expiring on or prior to the Purchase Date.
(b) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, consummate an Asset Sale unless at least
75% of the consideration thereof received by the Company or such Restricted
Subsidiary is in the form of cash, cash equivalents or marketable securities;
provided that, solely for purposes of calculating such 75% of the consideration,
the amount of (i) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet or in the notes thereto, excluding
contingent liabilities and trade payables), of the Company or any Restricted
Subsidiary (other than liabilities that are by their terms subordinated to the
Senior Notes) that are assumed by the transferee of any such assets and (ii) any
notes or other obligations received by the Company or any such Restricted
Subsidiary from such transferee that are promptly, but in no event more than 30
days after receipt, converted by the Company or such Restricted Subsidiary into
cash (to the extent of the cash received), shall be deemed to be cash and cash
equivalents for purposes of this provision. Any Net Proceeds from any Asset Sale
that are not applied or invested as provided in Section 4.14(a) shall
constitute "Excess Proceeds."
67
(c) When the aggregate amount of Excess Proceeds exceeds $10,000,000
(such date being an "Asset Sale Trigger Date"), the Company shall make an Offer
to all Holders of Senior Notes to purchase the maximum principal amount of the
Senior Notes then outstanding that may be purchased out of Excess Proceeds, at
an offer price in cash in an amount equal to 100% of the principal amount
thereof plus any accrued and unpaid interest and Liquidated Damages, if any, to
the Purchase Date, in accordance with the procedures set forth in this
Indenture.
(d) To the extent that substantially concurrently with being required
to make an Offer to the holders of the Senior Notes on account of an Asset
Sale, the Company is required to make a similar Offer to holders of any other
Indebtedness ranking pari passu with the Senior Notes (including without
limitation the Discount Notes), the Excess Proceeds allocable to each such Offer
shall be allocated as nearly as practicable pro rata as between the Discount
Notes and the Senior Notes in accordance with the respective aggregate principal
amount or Accreted Value thereof, as the case may be.
(e) To the extent that any Excess Proceeds remain after completion of
an Offer, the Company may use such remaining amount for general corporate
purposes.
(f) If the aggregate principal amount of Senior Notes surrendered by
Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select
the Senior Notes to be purchased on a pro rata basis, by lot or by a method that
complies with the requirements of any stock exchange on which the Senior Notes
are listed and that the Trustee considers fair and appropriate.
(g) Upon completion of an Offer related to an Asset Sale, the amount
of Excess Proceeds shall be reset at zero.
(h) Notwithstanding the foregoing, to the extent that any or all of
the Net Proceeds of an Asset Sale is prohibited or delayed by applicable local
law from being repatriated to the United States, the portion of such Net
Proceeds so affected will not be required to be applied pursuant to Section
4.14, but may be retained for so long, but only for so long, as the applicable
local law prohibits repatriation to the United States.
68
The Company will promptly take all reasonable actions required by the applicable
local law to permit such repatriation, and once such repatriation of any
affected Net Proceeds is not prohibited under applicable local law, such
repatriation will be immediately effected and such repatriated Net Proceeds will
be applied in the manner set forth above as if such Asset Sale had occurred on
the date of repatriation.
SECTION 4.15 LIMITATION ON GUARANTEES OF COMPANY INDEBTEDNESS BY RESTRICTED
SUBSIDIARIES.
(a) The Company shall not permit any Restrict ed Subsidiary, directly
or indirectly, to guarantee any Indebtedness of the Company other than the
Senior Notes (the "Other Company Indebtedness"), unless (i) such Restricted
Subsidiary contemporaneously executes and delivers a supplemental indenture to
the Indenture providing for a guarantee of payment of the Senior Notes then
outstanding by such Restricted Subsidiary to the same extent as the guarantee
(the "Other Company Indebtedness Guarantee") of the Other Company Indebtedness
(including waiver of subrogation, if any) and (ii) if the Other Company
Indebtedness guaranteed by such Restricted Subsidiary is (A) Senior
Indebtedness, the guarantee for the Senior Notes shall be pari passu in right of
payment with the Other Company Indebtedness Guarantee and (B) Subordinated
Indebtedness, the guarantee for the Senior Notes shall be senior in right of
payment to the Other Company Indebtedness Guarantee; provided that the foregoing
will not limit or restrict guarantees issued by Restricted Subsidiaries in
respect of Indebtedness of other Restricted Subsidiaries.
(b) Each guarantee of the Senior Notes created by a Restricted
Subsidiary pursuant to Section 4.15(a) shall be in accordance with Section
4.15(a), shall be delivered to the Trustee and shall provide, among other
things, that it shall be automatically and unconditionally released and
discharged upon (i) any sale, exchange or transfer permitted by this Indenture
of (A) all of the Company's Capital Stock in such Restricted Subsidiary or (B)
the sale of all or substantially all of the assets of the Restricted Subsidiary
and upon the application of the Net Proceeds from such sale in accordance with
the requirements of Section 4.14, or (ii) the release or discharge of the
Other Company Indebtedness Guarantee that
69
resulted in the creation of such guarantee of the Senior Notes, except a
discharge or release by or as a result of payment under such Other Company
Indebtedness Guarantee.
SECTION 4.16 DESIGNATION OF RESTRICTED AND NON-RESTRICTED SUBSIDIARIES.
(a) From and after the date of original issuance of the Senior
Notes, the Company may designate any existing or newly formed or acquired
Subsidiary as a Non-Restricted Subsidiary, provided that (i) either (A) the
Subsidiary to be so designated has total assets of $1,000,000 or less or (B)
immediately before and after giving effect to such designation on a Pro Forma
Basis, (1) the Company could incur $1.00 of additional Indebted ness pursuant to
Section 4.7(a) determined on a Pro Forma Basis; and (2) no Default or Event of
Default shall have occurred and be continuing, or shall occur as a consequence
thereof, and (ii) all transactions between the Subsidiary to be so designated
and its Affiliates remaining in effect are permitted pursuant to Section 4.8.
Any Investment made by the Company or any Restricted Subsidiary in a Subsidiary
which is redesignated from a Restricted Subsidiary to a Non-Restricted
Subsidiary shall be considered as having been a Restricted Payment (to the
extent not previously included as a Restricted Payment) made on the day such
Subsidiary is designated as a Non-Restricted Subsidiary in the amount of the
greater of (i) the fair market value (as determined by the Board of Directors of
the Company in good faith) of the Equity Interests of such Subsidiary held by
the Company and its Restricted Subsidiaries on such date, and (ii) the amount of
the Investments determined in accordance with GAAP made by the Company and any
of its Restricted Subsidiaries in such Subsidiary.
(b) A Non-Restricted Subsidiary may be redesignated as a Restricted
Subsidiary. 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 a Non-Restricted
Subsidiary or otherwise, but not including through the creation of a new
Restricted Subsidiary) unless, immediately before and after giving effect to
such action, transaction or series of transactions on a Pro Forma Basis, (i) the
Company
70
could incur at least $1.00 of additional Indebtedness pursuant to Section 4.7(a)
and (ii) no Default or Event of Default shall have occurred and be continuing or
shall occur as a consequence thereof.
(c) The designation of a Subsidiary as a Restricted Subsidiary or the
removal of such designation is required to be made by a resolution adopted by a
majority of the Board of Directors of the Company stating that the Board of
Directors has made such designation in accordance with this Indenture, and the
Company is required to deliver to the Trustee such resolution together with an
Officers' Certificate certifying that the designation complies with this
Indenture. Such designation shall be effective as of the date specified in the
applicable resolution, which may not be before the date the applicable
Officers' Certificate is delivered to the Trustee.
(d) The sale and transfer of all of the Equity Interests in a foreign
Restricted Subsidiary to a Non-Restricted Subsidiary and the subsequent
redesignation of such foreign Restricted Subsidiary as a Non-Restricted
Subsidiary as contemplated by the definition of "Restricted Subsidiary" will
not be considered a redesignation of a Restricted Subsidiary for purposes of
this Section 4.16.
ARTICLE 5
SUCCESSORS
SECTION 5.1 MERGER OR CONSOLIDATION.
(a) The Company shall not consolidate or merge with or into, or sell,
lease, convey or otherwise dispose of all or substantially all of its assets to,
any Person(any such consolidation, merger or sale being a "Disposition") unless
(i) the successor corporation of such Disposition or the Person to which such
Disposition shall have been made is a corporation organized or existing under
the laws of the United States, any state thereof or the District of Columbia;
(ii) the successor corporation of such Disposition or the corporation to which
such Disposition shall have been made expressly assumes the Obligations of the
Company, pursuant to a supplemental indenture in a form reasonably satisfactory
to the Trust-
71
ee, under the Indenture and the Senior Notes; (iii) immediately after such
Disposition, no Default or Event of Default shall exist; and (iv) the
corporation formed by or surviving any such Disposition, or the corporation to
which such Disposition shall have been made, shall (A) have Consolidated Net
Worth (immediately after the Disposition but prior to giving effect on a Pro
Forma Basis to any purchase accounting adjustments or Restructuring Charges
resulting from the Disposition) equal to or greater than the Consolidated Net
Worth of the Company immediately preceding the Disposition, (B) be permitted
immediately after the Disposition by the terms of this Indenture to issue at
least $1.00 of additional Indebted ness determined on a Pro Forma Basis pursuant
to Section 4.7(a), and (C) have a Cash Flow Coverage Ratio, for the four fiscal
quarters immediately preceding the applicable Disposition, determined on a Pro
Forma Basis, equal to or greater than the actual Cash Flow Coverage Ratio of the
Company for such four quarter period. The limitations in this Section 5.1(a) on
the Company's ability to make a Disposition do not restrict the Company's
ability to sell less than all or substantially all of its assets, such sales
being governed by Section 4.14.
(b) Prior to the consummation of any proposed Disposition, the
Company shall deliver to the Trustee an Officers' Certificate to the foregoing
effect and an Opinion of Counsel stating that the proposed Disposition and such
supplemental indenture comply with this Indenture.
SECTION 5.2 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any Disposition, the Successor Corporation resulting from such
Disposition shall succeed to, and be substituted for, and may exercise every
right and power of, the Company under this Indenture with the same effect as if
such Successor has been named as the Company here in; provided, however, that
neither the Company nor any Successor Corporation shall be released from its
Obligation to pay the principal of, premium, if any, and accrued and unpaid
interest on, and Liquidated Damages, if any, with respect to the Senior Notes.
72
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1 EVENTS OF DEFAULT.
(a) An Event of Default is:
(i) a default for 30 days in payment of interest on, or
Liquidated Damages, if any, with respect to, the Senior Notes;
(ii) a default in payment when due at maturity, upon redemption
or otherwise, of principal or premium, if any, with respect to, the Senior
Notes;
(iii) the failure of the Company to comply with any of its other
agreements or covenants in, or provisions of, this Indenture or the Senior
Notes outstanding and the Default continues for the period, if applicable,
and after the notice specified in Section 6.1(b);
(iv) a default by the Company or any Restricted Subsidiary
under any mortgage, indenture or instrument under which there may be issued
or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Company or any Restricted Subsidiary (or the payment of
which is guaranteed by the Company or any Restricted Subsidiary), whether
such Indebtedness or guarantee now exists or shall be created hereafter, if
(A) either (1) such default results from the failure to pay principal of or
interest on any such Indebtedness at the Stated Maturity thereof or upon
such Indebted ness becoming due upon the redemption thereof or otherwise
and such default continues for 30 days beyond any applicable grace period
or (2) as a result of such default the maturity of such Indebtedness has
been accelerated prior to its expressed maturity, and (B) the principal
amount of such Indebtedness, together with the principal amount of any
other such Indebtedness in default for failure to pay principal or interest
thereon, at final maturity, or because of the acceleration of the maturity
thereof, aggregates in excess of $10,000,000;
73
(v) a failure by the Company or any Restricted Subsidiary to pay
final judgments (not covered by insurance) aggregating in excess of $10,000,000
which judgments a court of competent jurisdiction does not rescind, annual or
stay within 45 days after their entry and the Default continues for the period
and after the notice specified in Section 6.1(b);
(vi) in existence when the Company or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors; and
(vii) in existence when a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant Subsidiary
in an involuntary case,
(B) appoints a Custodian of the Company or any Significant Subsidiary
or for all or substantially all of the property of the Company
or any Significant Subsidiary, or
(C) orders the liquidation of the Company or any Significant
Subsidiary,
and any such order or decree remains unstayed and in effect for 60
days.
74
(b) A Default or Event of Default under Section 6.1(a)(iii) (other
than an Event of Default arising under Section 5.1 which shall be an Event of
Default with the notice but without the passage of time specified in this
Section 6.1(b)) or Section 6.1(a)(v) is not an Event of Default under this
Indenture until the Trustee or the Holders of at least 25% in principal amount
of the Senior Notes then outstanding notify the Company of the Default and the
Company does not cure the Default within 45 days after receipt of the notice.
The notice must specify the Default, demand that it be remedied, and state that
the notice is a "Notice of Default."
(c) In the case of any Event of Default pursuant to Section 6.1(a)
or Section 6.1(b) occurring by reason of any willful action (or inaction) taken
(or not taken) by or on behalf of the Company with the intention of avoiding
payment of the premium that the Company would have to pay if the Company then
had elected to redeem the Senior Notes pursuant to paragraph 5 of the Senior
Notes, an equivalent premium shall also become and be immediately due and
payable to the extent permitted by law, anything in this Indenture or in the
Senior Notes contained to the contrary notwithstanding.
(d) The Trustee shall not be charged with knowledge of any Default or
Event of Default unless written notice thereof shall have been given to a Trust
Officer at the Corporate Trust Office of the Trustee by the Company or any other
Person.
SECTION 6.2 ACCELERATION.
------------
(a) Upon the occurrence of an Event of Default (other than an Event
of Default under Section 6.1(a)(vi) or (vii)), the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Senior Notes may declare
all Senior Notes to be due and payable immediately and, upon such declaration,
the principal of, premium, if any, and any accrued and unpaid interest on, and
Liquidated Damages, if any, with respect to all Senior Notes shall be due and
payable immediately; provided, however, that if an Event of Default arises under
Section 6.1(a)(vi) or (vii), the principal of, and any accrued and unpaid
interest on, all Senior Notes, shall ipso facto become and be immediately due
and payable
75
without any declaration or other act on the part of the Trustee or any Holders
of Senior Notes.
(b) The Holders of a majority in principal amount of the Senior Notes
then outstanding, by notice to the Trustee, may rescind any declaration of
acceleration of such Senior Notes and its consequences (if the rescission would
not conflict with any judgment or decree) if all existing Events of Default
(other than the nonpayment of principal of or interest on such Senior Notes that
shall have become due by such declaration) shall have been cured or waived.
(c) If there has been a declaration of acceleration of the Senior
Notes because an Event of Default under Section 6.1(a)(iv) has occurred and is
continuing, such declaration of acceleration shall be automatically annulled if
the holders of the Indebtedness described in Section 6.1(a)(iv) have rescinded
the declaration of acceleration in respect of such Indebtedness within 30
Business Days thereof and if (i) the annulment of such acceleration would not
conflict with any judgment or decree of a court of competent jurisdiction, (ii)
all existing Events of Default, except non-payment of principal or interest
that shall have become due solely because of the acceleration, have been cured
or waived, and (iii) the Company has delivered an Officers' Certificate to the
Trustee to the effect of clauses (i) and (ii) above.
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, premium, if
any, or any accrued and unpaid interest on, or Liquidated Damages, if any, with
respect to the Senior Notes or to enforce the performance of any provision of
the Senior Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Senior Notes or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
76
SECTION 6.4 WAIVER OF PAST DEFAULTS.
-----------------------
The holders of a majority in aggregate principal amount of the Senior
Notes then outstanding by notice to the Trustee may on behalf of all Holders of
Senior Notes waive any existing Default or Event of Default under this Indenture
and its consequences, except a continuing Default in the payment of the
principal of, premium, if any, and interest on, and Liquidated Damages, if any,
with respect to such Senior Notes, which may only be waived with the consent of
each Holder of Senior Notes affected. Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Indenture; provided that no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
SECTION 6.5 CONTROL BY MAJORITY.
-------------------
Subject to Section 7.1(e), the Holders of a majority in principal
amount of the then outstanding Senior Notes may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it by this Indenture. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that the Trustee determines may be unduly prejudicial to the rights
of other Holders or would involve the Trustee in personal liability.
SECTION 6.6 LIMITATION ON SUITS.
-------------------
A Holder may pursue a remedy with respect to this Indenture or the
Senior Notes only if (i) the Holder gives to the Trustee notice of a continuing
Event of Default; (ii) the Holders of at least 25% in principal amount of the
then outstanding Senior Notes make a request to the Trustee to pursue the
remedy; (iii) such Holder or Holders offer to the Trustee indemnity satis-
factory to the Trustee against any loss, liability or expense; (iv) the Trustee
does not comply with the request within 60 days after receipt of the request
and the offer of indemnity; and (v) during such 60-day period the Holders of a
majority in principal amount of the then outstanding Senior Notes do not give
the Trustee a direction inconsistent with the request.
77
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
Holders of the Senior Notes may not enforce this Indenture, except as
provided herein.
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, premium, if any, and any accrued
and unpaid interest on, and Liquidated Damages, if any, with respect to a Senior
Note, on or after a respective due date expressed in the Senior Note, or to
bring suit for the enforcement of any such payment on or after such respective
date, shall not be impaired or affected without the consent of the Holder.
SECTION 6.8 COLLECTION SUIT BY TRUSTEE.
--------------------------
If an Event of Default specified in Section 6.1(a)(i) or (ii) occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for (i) the principal,
premium and Liquidated Damages, if any, and interest remaining unpaid on the
Senior Notes, (ii) interest on overdue principal and premium, if any, and, to
the extent lawful, interest, and (iii) such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel ("Trustee Expenses").
SECTION 6.9 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 to have the claims of the Trustee
(including any claim for Trustee Expenses) and the Holders allowed in any
Insolvency or Liquidation Proceeding or other judicial proceeding relative to
the Company (or any other obligor upon the Senior Notes), its creditors or its
property and shall be entitled and empowered to collect, receive and distribute
to Holders any money or other property payable or deliverable on any such claims
and each Holder authorizes any Custodian in any such Insolvency or Liquidation
78
Proceeding or other judicial proceeding to make such payments to the Trustee,
and if the Trustee shall consent to the making of such payments directly to the
Holders any such Custodian is hereby authorized to make such payments directly
to the Holders, and to pay to the Trustee any amount due to it hereunder for
Trustee Expenses, and any other amounts due the Trustee under Section 7.7. To
the extent that the payment of any such Trustee Expenses, and any other amounts
due the Trustee under Section 7.7 out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties which the Holders may be entitled to receive in
such proceeding, whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf of
any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Senior Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any Insolvency or
Liquidation Proceeding.
SECTION 6.10 PRIORITIES.
----------
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 7.7;
Second: to Holders for amounts due and unpaid on the Senior Notes for
principal, premium and Liquidated Damages, if any, and interest,
ratably, without preference or priority of any kind, according to
the amounts due and payable on the Senior Notes for principal,
premium and Liquidated Damages, if any, and interest,
respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders.
79
SECTION 6.11 UNDERTAKING FOR COSTS.
---------------------
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section does
not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7,
or a suit by Holders of more than 10% in principal amount of the then
outstanding Senior Notes.
ARTICLE 7
TRUSTEE
SECTION 7.1 DUTIES OF TRUSTEE.
-----------------
(a) If an Event of Default occurs (and has not been cured) the Trustee
shall (i) exercise the rights and powers vested in it by this Indenture, and
(ii) use the same degree of care and skill in exercising such rights and powers
as a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee's duties shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
the
80
Trustee shall examine the certificates and opinions to determine whether
they conform to this Indenture's requirements.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own wilful
misconduct, except that:
(i) this paragraph does not limit the effect of Section 7.1(b);
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction it
receives pursuant to Section 6.5.
(d) Whether or not expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c) and (e) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders unless such Holders shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money it
receives except as the Trustee may agree in writing with the Company. Money the
Trustee holds in trust need not be segregated from other funds except to the
extent required by law.
SECTION 7.2 RIGHTS OF TRUSTEE.
-----------------
(a) The Trustee may rely on any document it believes to be genuine and
to have been signed or presented by the proper Person. The Trustee shall not be
81
obligated to investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may reasonably
require an Officers' Certificate or an Opinion of Counsel, or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any Agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take, except to the extent that such action or omission to act constitutes
negligence or wilful misconduct on the part of the Trustee.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer.
(f) Except with respect to Section 4.1, the Trustee shall have no duty
to inquire as to the performance by the Company with respect to the covenants
contained in Article 4. In addition, the Trustee shall not be deemed to have
knowledge of a Default or Event of Default except (i) any Default or Event of
Default occur ring pursuant to Sections 4.1, 6.1(a)(i) or 6.1(a)(ii), or (ii)
any Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.
----------------------------
The Trustee in its individual or any other capacity may become the owner or
pledgee of Senior Notes and may otherwise deal with the Company or an Affiliate
with the same rights it would have if it were not Trustee. However, if the
Trustee acquires any conflicting interest it
82
must eliminate such conflict within 90 days, apply to the Commission for
permission to continue as Trustee or resign. Any Agent may do the same with
like rights. The Trustee is also subject to Sections 7.10 and 7.11.
SECTION 7.4 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 Senior Notes, it shall
not be accountable for the Company's use of the proceeds from the Senior Notes
or for any money paid to the Company or upon the Company's direction under any
provisions hereof, it shall not be responsible for the use or application of any
money any Paying Agent other than the Trustee receives, and it shall not be
responsible for any statement or recital herein or any statement in the Senior
Notes or any other document furnished or issued in connection with the sale of
the Senior Notes or pursuant to this Indenture, other than its certificate of
authentication.
SECTION 7.5 NOTICE TO HOLDERS OF DEFAULTS AND EVENTS OF DEFAULT.
---------------------------------------------------
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment on any Senior Note (including any
failure to redeem Senior Notes called for redemption or any failure to purchase
Senior Notes tendered pursuant to an Offer that are required to be purchased by
the terms of this Indenture), the Trustee may withhold the notice if and so long
as a committee of its Trust Officers in good faith determines that withholding
the notice is in the Holders' interests.
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS.
-----------------------------
Within 60 days after each May 15 beginning with May 15, 1998, the
Trustee shall mail to Holders a brief report dated as of such reporting date
that complies with section 313(a) of the TIA (but if no event described in
section 313(a) of the TIA has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with section
83
313(b)(2) of the TIA. The Trustee shall also transmit by mail all reports as
required by section 313(c) of the TIA.
Commencing at the time this Indenture is qualified under the TIA, a
copy of each report at the time of its mailing to Holders shall be filed with
the SEC and each national securities exchange on which the Senior Notes are
listed. The Company shall notify the Trustee when the Senior Notes are listed
on any national securities exchange.
SECTION 7.7 COMPENSATION AND INDEMNITY.
--------------------------
The Company shall pay to the Trustee (in its capacities as Trustee,
Paying Agent and/or Registrar) from time to time reasonable compensation for its
services hereunder. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Company shall reimburse
the Trustee upon request for all reasonable disbursements, advances, fees and
expenses it incurs or makes in addition to the compensation for its services.
Such expenses shall include the reasonable compensation, disbursements and
expenses of the Trustee's agents and counsel.
The Company shall indemnify and hold harmless the Trustee (in its
capacities as Trustee, Paying Agent and/or Registrar) against any and all
losses, liabilities or expenses the Trustee incurs arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, except as set forth below. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee
to so notify the Company shall not relieve the Company of its Obligations
hereunder. The Company shall defend the claim and the Trustee shall reasonably
cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent, which consent shall
not be unreasonably withheld.
The Company's Obligations under this Section 7.7 shall survive the
satisfaction and discharge of this Indenture.
84
The Company need not reimburse any expense or indemnify against any
loss or liability the Trustee incurs through negligence or bad faith.
To secure the Company's payment of its Obligations in this Section,
the Trustee shall have a Lien prior to the Senior Notes on all money or property
the Trustee holds or collects. Such Lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(a)(vii) or (viii) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute administrative expenses under any
Bankruptcy Law.
SECTION 7.8 REPLACEMENT OF TRUSTEE.
----------------------
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign and be discharged from the trust hereby created
by so notifying the Company. The Holders of a majority in principal amount of
the then outstanding Senior Notes may remove the Trustee by so notifying the
Trustee and the Company. The Company may remove the Trustee if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(iii) a Custodian or public officer takes charge of the Trustee
or its property; or
(iv) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the
85
Company shall promptly appoint a successor Trustee, provided that the Holders of
a majority in principal amount of the then outstanding Senior Notes may appoint
a successor Trustee to replace any successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the then outstanding Senior Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
appointment to Holders. The retiring Trustee shall promptly transfer all
property it holds as Trustee to the successor Trustee, provided all sums owing
to the retiring Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.7. Notwithstanding replacement of the Trustee
pursuant to this Section 7.8, the Company's obligations under Section 7.7 shall
continue for the retiring Trustee's benefit with respect to expenses and
liabilities it incurred prior to being replaced.
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC.
--------------------------------
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
86
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.
-----------------------------
The Trustee shall at all times (i) be a corporation organized and
doing business under the laws of the United States of America, of any state
thereof, or the District of Columbia authorized under such laws to exercise
corporate trustee power, (ii) be subject to supervision or examination by
federal or state authority, (iii) have a combined capital and surplus of at
least $25,000,000, or be a member of a bank holding company which has a
combined capital and surplus of at least $100,000,000, as set forth in its most
recent published annual report of condition, and (iv) satisfy the requirements
of sections 310(a)(1), (2) and (5) of the TIA. The Trustee is subject to
section 310(b) of the TIA.
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
-----------------------------------------------------
The Trustee is subject to section 311(a) of the TIA, excluding any
creditor relationship listed in section 311(b) of the TIA. A Trustee who has
resigned or been removed shall be subject to section 311(a) of the TIA to the
extent indicated therein.
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.1 DISCHARGE OF LIABILITY ON SENIOR NOTES; DEFEASANCE.
--------------------------------------------------
(a) When (i) the Company delivers to the Trustee all outstanding
Senior Notes (other than Senior Notes replaced pursuant to Section 2.7) for
cancellation, or (ii) all outstanding Senior Notes have become due and payable
and the Company irrevocably deposits with the Trustee funds sufficient to pay at
maturity all outstanding Senior Notes, including interest, premium and
Liquidated Damages thereon (other than Senior Notes replaced pursuant to Section
2.7), and if in either case the Company pays all other sums payable under this
Indenture by the Company, then this Indenture shall, subject to Sections 8.1(c)
and 8.6, cease to be of further effect.
(b) Subject to Sections 8.1(c), 8.2 and 8.6, the Company at any time
may terminate (i) all its obliga-
87
tions under the Senior Notes and this Indenture ("legal defeasance option") or
(ii) its obligations under Sections 4.2, 4.3, 4.5, 4.6, 4.7, 4.8, 4.9, 4.10,
4.11, 4.13, 4.14, 4.15 and 4.16, and the operation of Sections 5.1(a)(iii),
5.1(a)(iv), or 6.1(a)(iii) through (a)(vi) ("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
Senior Notes may not be accelerated because of an Event of Default. If the
Company exercises its covenant defeasance option, payment of the Senior Notes
shall not be accelerated because of an Event of Default specified in 6.1(a)(iii)
through (a)(vi) or because of the Company's failure to comply with Section
5.1(a)(iii) and 5.1(a)(iv).
Upon satisfaction of the conditions set forth herein and upon the
Company's request (and at the Company's expense), the Trustee shall acknowledge
in writing the discharge of those obligations that the Company has terminated.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.3, 2.4, 2.5, 2.6, 2.7, 4.1, 4.4, 7.7, 7.8, 8.4, 8.5
and 8.6, and the Trustee's and the Paying Agent's obligations in Section 8.4
shall survive until the Senior Notes have been paid in full. Thereafter, the
Company's obligations in Sections 7.7 and 8.5 and the Company's, the Trustee's
and the Paying Agent's obligations in Section 8.4 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 (the "defeasance
trust") with the Trustee money or U.S. Government Obligations
sufficient for the payment in full of the principal of,
premium, if any, and any accrued and unpaid interest on, and
Liquidated Damages, if any, with respect to the Senior Notes
then outstanding, as of the
88
maturity date, the redemption date or the Purchase Date, as the
case may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing
their opinion that the payments of principal and interest when due
and without reinvestment of the deposited U.S. Government
Obligations plus any deposited money without investment will
provide cash at such times and in such amounts as will be
sufficient to pay when due principal of, premium, if any, and any
accrued and unpaid interest on, and Liquidated Damages, if any,
with respect to all the Senior Notes to maturity or redemption, as
the case may be;
(3) since the Company's irrevocable deposit provided for in Section
8.2(l), 91 days have passed;
(4) no Default has occurred and is continuing on the date of such
deposit and after giving effect to it;
(5) the deposit does not constitute a default under any other
agreement binding on the Company;
(6) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940, as amended;
(7) in the case of the legal defeasance option, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (i)
the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or (ii) under applicable federal
income tax law, in either case, to the effect that, and based
thereon such Opinion of Counsel shall
89
confirm that, the Holders will not recognize income, gain or loss
for federal income tax purposes as a result of such deposit and
defeasance and will be subject to federal income tax on the same
amount, in the same manner and at the same times as would have
been the case if such defeasance had not occurred;
(8) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and
covenant defeasance and will be subject to federal income tax on
the same amount, in the same manner and at the same times as would
have been the case if such covenant defeasance had not occurred
(and, in the case of legal defeasance only, such opinion of
counsel must be based on a ruling of the Internal Revenue Service
or other change in applicable federal income tax law); 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 Senior Notes contemplated
by this Article 8 have been satisfied.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption or purchase of Senior Notes 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, premium, if any,
and any accrued
90
and unpaid interest on, and Liquidated Damages, if any, with respect to the
Senior Notes.
SECTION 8.4 REPAYMENT TO THE COMPANY.
After the Senior Notes have been paid in full, the Trustee and the Paying
Agent shall promptly turn over to the Company any excess money or securities
they hold.
The Trustee and the Paying Agent shall pay to the Company upon written
request by the Company any money they hold for the payment of principal,
premium, interest or Liquidated Damages that remains unclaimed for 1 year after
the date upon which such payment shall have become due; provided, however, that
the Company shall have either caused notice of such payment to be mailed to each
Holder entitled thereto no less than 30 days prior to such repayment or within
such period shall have published such notice in a financial newspaper of
widespread circulation published in The City of New York (including, without
limitation, The Wall Street Journal). After payment to the Company, Holders
entitled to the money must look to the Company for payment as general creditors
unless an applicable abandoned property law designates another Person, and all
liability of the Trustee and such Paying Agent with respect to such money shall
cease.
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 Senior Notes 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
91
U.S. Government Obligations in accordance with this Article 8; provided,
however, that, if the Company has made any payment of principal of, premium, if
any, and any accrued and unpaid interest on, and Liquidated Damages, if any,
with respect to any Senior Notes because of the reinstatement of its
Obligations, the Company shall be subrogated to the Holders' rights to receive
such payment from the money or U.S. Government Obligations the Trustee or Paying
Agent holds.
ARTICLE 9
AMENDMENTS
SECTION 9.1 AMENDMENTS AND SUPPLEMENTS PERMITTED WITHOUT CONSENT OF HOLDERS.
Notwithstanding Section 9.2, the Company and the Trustee may amend or
supplement this Indenture or the Senior Notes without the consent of any Holder
(a) to cure any ambiguity, defect or inconsistency; (b) to provide for
uncertificated Senior Notes in addition to or in place of certificated Senior
Notes; (c) to provide for the assumption of the Company's Obligations in the
event of a Disposition pursuant to Article 5; (d) to comply with the SEC's
requirements to effect or maintain the qualification of this Indenture under the
TIA; (e) to provide for additional Guarantees with respect to the Senior Notes;
or (f) to make any change that does not materially adversely affect any Holder's
legal rights under this Indenture.
Upon the Company's request, after receipt by the Trustee of a resolution of
the Board of Directors authorizing the execution of any amended or supplemental
indenture and the documents described in Section 9.6, the Trustee shall join
with the Company in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be contained in any such
amended or supplemental indenture, but the Trustee shall not be obligated to
enter into an amended or supplemental indenture that affects its own rights,
duties or immunities under this Indenture or otherwise.
92
SECTION 9.2 AMENDMENTS AND SUPPLEMENTS REQUIRING CONSENT OF HOLDERS.
Subject to Section 6.7, the Company and the Trustee may amend or supplement
this Indenture or the Senior Notes with the written consent of the Holders of at
least a majority in principal amount of the then outstanding Senior Notes
(including consents obtained in connection with a tender offer or exchange offer
for the Senior Notes). Subject to Sections 6.4 and 6.7, the Holders of a
majority in principal amount of the Senior Notes then outstanding (including
consents obtained in connection with a tender offer or exchange offer for the
Senior Notes) may also waive any existing Default or Event of Default (other
than a payment Default) and its consequences or compliance in a particular
instance by the Company with any provision of this Indenture or the Senior
Notes.
Upon the Company's request and after receipt by the Trustee of a resolution
of the Board of Directors authorizing the execution of any supplemental
indenture, evidence of the Holders' consent, and the documents described in
Section 9.6, the Trustee shall join with the Company in the execution of such
amended or supplemental indenture unless such amended or supplemental indenture
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders under this Section
to approve the particular form of any proposed amendment or waiver, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment or waiver under this Section becomes effective, the
Company shall mail to each Holder affected thereby a notice briefly describing
the amendment, supplement or waiver. Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amended or supplemental indenture or waiver. Without
the consent of each Holder affected, an amendment, supplement or waiver under
this Section may not (1) reduce the principal amount of Senior Notes whose
Holders must consent to an amendment, supplement or waiver; (2)
93
reduce the rate of or change the time for payment of interest, including default
interest as set forth in Section 4.1, or Liquidated Damages on any Senior Note
or alter the redemption or purchase provisions with respect thereto or the price
at which the Company is required to offer to purchase any Senior Note; (3)
reduce the principal of or change the fixed maturity of any Senior Note; (4)
make any Senior Note payable in money other than that stated in the Senior Note;
(5) make any change in Section 6.4 or 6.7 or in this sentence of this Section
9.2; or (6) waive a default in the payment of the principal of, or premium, if
any, or any accrued and unpaid interest on, or Liquidated Damages, if any, with
respect to, or redemption or purchase payment with respect to, any Senior Note
(except a rescission of acceleration of the Senior Notes by the Holders of at
least a majority in aggregate principal amount of the then outstanding Senior
Notes and a waiver of the payment default that resulted from such acceleration).
SECTION 9.3 COMPLIANCE WITH TIA.
Every amendment or supplement to this Indenture or the Senior Notes shall
be set forth in an amended supplemental indenture that complies with the TIA as
then in effect.
SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Senior Note is a continuing consent by the Holder and every
subsequent Holder of a Senior Note or portion of a Senior Note that evidences
the same Indebtedness as the consenting Holder's Senior Note, even if notation
of the consent is not made on any Senior Note. However, any such Holder or
subsequent Holder may revoke the consent as to his or her Senior Note or portion
of a Senior Note if the Trustee receives the notice of revocation before the
date on which the Trustee receives an Officers' Certificate certifying that the
Holders of the requisite principal amount of Senior Notes have consented to the
amendment or waiver.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders of Senior Notes entitled to consent to any
amendment or
94
waiver. If a record date is fixed, then, notwithstanding the provisions of the
immediately preceding paragraph, those Persons who were Holders of Senior Notes
at such record date (or their duly designated proxies), and only those Persons,
shall be entitled to consent to such amendment or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders of
Senior Notes after such record date. No consent shall be valid or effective for
more than 90 days after such record date unless consents from Holders of the
principal amount of Senior Notes required hereunder for such amendment or
waiver to be effective shall have also been given and not revoked within such
90-day period.
After an amendment or waiver becomes effective it shall bind every Holder,
unless it is of the type described in any of clauses (1) through (6) of Section
9.2. In such case, the amendment or waiver shall bind each Holder who has
consented to it and every subsequent Holder of a Senior Note that evidences the
same debt as the consenting Holder's Senior Note.
SECTION 9.5 NOTATION ON OR EXCHANGE OF SENIOR NOTES.
The Trustee may (at the Company's expense) place an appropriate notation
about an amendment, supplement or waiver on any Senior Note thereafter
authenticated. The Company in exchange for all Senior Notes may issue and the
Trustee shall authenticate new Senior Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Senior Note shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.6 TRUSTEE PROTECTED.
The Trustee shall sign any amendment or supplemental indenture authorized
pursuant to this Article 9 if the amendment does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing such amendment or supplemental
indenture, the Trustee shall be entitled to receive and, subject to Section 7.1,
shall be fully protected in relying upon, an Officers' Certificate and Opinion
of Counsel as conclusive evidence that such amendment or supplemental indenture
is authorized or
95
permitted by this Indenture, that it is not inconsistent herewith, and that it
will be valid and binding upon the Company in accordance with its terms. The
Company may not sign an amendment or supplemental indenture until the Board of
Directors approves it.
ARTICLE 10
MISCELLANEOUS
SECTION 10.1 TRUST INDENTURE ACT CONTROLS.
----------------------------
If any provision of this Indenture limits, qualifies, or conflicts with
the duties imposed by operation of section 318(c) of the TIA, the imposed duties
shall control.
SECTION 10.2 NOTICES.
-------
Any notice or communication by the Company or the Trustee to the other is
duly given if in writing and delivered in person, mailed by registered or
certified mail, postage prepaid, return receipt requested or delivered by
telecopier or overnight air courier guaranteeing next day delivery to the
other's address:
If to the Company:
Jordan Telecommunication Products
Group, Inc.
ArborLake Centre, Suite 550
0000 Xxxx Xxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: (000) 000-0000
with a copy to:
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
96
If to the Trustee:
First Trust National Association
000 Xxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Telecopier No.: (000) 000-0000
The Company or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; the date receipt is acknowledged, if mailed by registered or
certified mail; when answered back, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first-class mail
to his or her address shown on the register kept by the Registrar. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
SECTION 10.3 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
-------------------------------------------
Holders may communicate pursuant to section 312(b) of the TIA with other
Holders with respect to their rights under this Indenture or the Senior Notes.
The Company, the Trustee, the Registrar and any other Person shall have the
protection of section 312(c) of the TIA.
97
SECTION 10.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
--------------------------------------------------
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate (which shall include the statements set
forth in Section 10.5) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel (which shall include the statements set
forth in Section 10.5) stating that, in the opinion of such counsel, all such
conditions precedent provided for in this Indenture relating to the proposed
action have been complied with.
SECTION 10.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
---------------------------------------------
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to section 314(a)(4) of the TIA) shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained
in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in such Person's opinion, such
condition or covenant has been complied with.
98
SECTION 10.6 RULES BY TRUSTEE AND AGENTS.
---------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 10.7 LEGAL HOLIDAYS.
--------------
If a payment date is a Legal Holiday at a place of payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
SECTION 10.8 NO RECOURSE AGAINST OTHERS.
--------------------------
No officer, employee, director, stockholder or Subsidiary of the Company
shall have any liability for any Obligations of the Company under the Senior
Notes or this Indenture, or for any claim based on, in respect of, or by reason
of, such Obligations or the creation of any such Obligation, except, in the case
of a Subsidiary, for an express guarantee or an express creation of any Lien by
such Subsidiary of the Company's Obligations under the Senior Notes. Each Holder
by accepting a Senior Note waives and releases all such liability, and such
waiver and release is part of the consideration for the issuance of the Senior
Notes. The foregoing waiver may not be effective to waive liabilities under the
Federal securities law and the Commission is of the view that such a waiver is
against public policy.
SECTION 10.9 COUNTERPARTS.
------------
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute one
and the same agreement.
SECTION 10.10 VARIABLE PROVISIONS.
-------------------
The Company initially appoints the Trustee as Paying Agent, Registrar and
authenticating agent.
99
The first compliance certificate to be delivered by the Company to the
Trustee pursuant to Section 4.3 shall be for the fiscal year ending on December
31, 1997
SECTION 10.11 GOVERNING LAW.
-------------
The internal laws of the State of New York shall govern this Indenture and
the Senior Notes, without regard to the conflict of laws provisions thereof.
SECTION 10.12 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of its Subsidiaries, and no other indenture,
loan or debt agreement may be used to interpret this Indenture.
SECTION 10.13 SUCCESSORS.
----------
All agreements of the Company in this Indenture and the Senior Notes shall
bind its successor. All agreements of the Trustee in this Indenture shall bind
its successor.
SECTION 10.14 SEVERABILITY.
------------
If any provision in this Indenture or in the Senior Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 10.15 TABLE OF CONTENTS, HEADINGS, ETC.
--------------------------------
The Table of Contents, Cross-Reference Table and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
[NEXT PAGE IS THE SIGNATURE PAGE]
100
Dated as of July 25, 1997
JORDAN TELECOMMUNICATION
PRODUCTS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
Dated as of July 25, 1997
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
By: /s/ Xxxxxxx Xxxxxxxx
-------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Trust Officer
EXHIBIT A
(Face of Senior Note)
9 7/8% Series [A/B] Senior Note due 2007
No. $
CUSIP No.
JORDAN TELECOMMUNICATION PRODUCTS, INC.
promises to pay to
or registered assigns,
the principal sum of
Dollars on August 1, 2007.
Interest Payment Dates: February 1 and August 1.
Record Dates: January 15 and July 15.
Dated: ________ __, ____
JORDAN TELECOMMUNICATION
PRODUCTS, INC.
By:
------------------------------
Name:
Title:
Trustee's Certificate of Authentication
Dated: _______ __, ____
This is one of the [Global]
Senior Notes referred to in the
within-mentioned Indenture:
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
A-1
By: __________________________
(Authorized Signatory)
A-2
[Unless and until it is exchanged in whole or in part for Senior Notes in
definitive form, this Senior Note may not be transferred except as a whole by
the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary or by the Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary. The Depository Trust Company shall act as the Depositary until a
successor shall be appointed by the Company and the Registrar. Unless this
certificate is presented by an authorized representative of The Depository Trust
Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) ("XXX"), 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 may be
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or such other entity as may be 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.]/1/
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN
A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX
SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED
HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE
RESOLD, PLEDGED OR OTHER WISE TRANSFERRED, ONLY (1)(a) INSIDE THE UNITED
STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, OR (c) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO
----------
/1/ This paragraph should be included only if the Senior Note is issued in
global form.
A-3
REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY
ANY PURCHASER PROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE.
Additional provisions of this Senior Note are set forth on the other side
of this Senior Note.
A-4
(Back of Senior Note)
9 7/8% SERIES [A/B] SENIOR NOTE DUE 2007
1. Interest. Jordan Telecommunication Products, Inc. (the "Company")
promises to pay interest on the principal amount of the Senior Notes at the rate
and in the manner specified below. Interest on the Senior Notes will accrue at
9 7/8% per annum from the date this Senior Note is issued until maturity. The
Company will pay Liquidated Damages pursuant to Section 5 of the Registration
Rights Agreement referred to below. Interest and Liquidated Damages, if any,
will be payable semiannually in cash in arrears on February 1 and August 1 of
each year, or if any such day is not a Business Day on the next succeeding
Business Day (each, an "Interest Payment Date"). Interest on the Senior Notes
will accrue from the most recent date on which interest has been paid or, if no
interest has been paid, from the date of original issuance; provided that the
first Interest Payment Date shall be February 1, 1998. The Company shall pay
interest on overdue principal and premium, if any, from time to time on demand
at the interest rate then in effect and shall pay interest on overdue
installments of interest and Liquidated Damages, if any, (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Senior Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered holders of Senior Notes at the close of business on the record date
for the next Interest Payment Date even if such Senior Notes are cancelled after
such record date and on or before such Interest Payment Date. Holders must
surrender Senior Notes to a Paying Agent to collect principal payments on such
Senior Notes. The Company will pay principal, premium, if any, interest and
Liquidated Damages, if any, in money of the United States that at the time of
payment is legal tender for payment of public and private debts. The Company
will pay principal, premium, if any, interest and Liquidated Damages, if any, by
wire transfer of immediately available funds to the accounts specified by the
Holders or, if no such account is specified, by mailing a check to each such
Holder's registered address; provided that payment by wire transfer of
immediately available funds will be required
A-5
with respect to principal, premium, if any, interest and Liquidated Damages, if
any, on all Global Senior Notes.
3. Paying Agent and Registrar. First Trust National Association (the
"Trustee") will initially act as the Paying Agent and Registrar. The Company
may appoint additional paying agents or co-registrars, and change the Paying
Agent, any additional paying agent, the Registrar or any co-registrar without
prior notice to any Holder. The Company or any of its Subsidiaries may act in
any such capacity.
4. Indenture. The Company issued the Senior Notes under an Indenture,
dated as of July 25, 1997 (the "Indenture"), among the Company and the Trustee.
The terms of the Senior Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939 (15
U.S. Code (S)(S) 77aaa-77bbbb) as in effect on the date of the original issuance
of the Senior Notes (the "Trust Indenture Act"). The Senior Notes are subject
to, and qualified by, all such terms, certain of which are summarized herein,
and Holders are referred to the Indenture and the Trust Indenture Act for a
statement of such terms (all capitalized terms not defined herein shall have the
meanings assigned them in the Indenture). The Senior Notes are unsecured senior
obligations of the Company limited to $190,000,000 in aggregate principal
amount.
5. Optional Redemption. (a) Except as described in paragraph 5(b) below,
the Senior Notes may not be redeemed at the option of the Company prior to
August 1, 2002. During the twelve (12) month period beginning August 1 of the
years indicated below, the Senior Notes will be redeemable at the option of the
Company, in whole or in part, on at least 30 but not more than 60 days' notice
to each Holder of Senior Notes to be redeemed, at the redemption prices
(expressed as percentages of the principal amount) set forth below, plus any
accrued and unpaid interest and Liquidated Damages, if any, to the date of
redemption:
Year Percentage
---- ----------
2002.......................... 104.9375%
2003.......................... 102.4688%
2004 and thereafter........... 100.0000%
(b) Notwithstanding the foregoing, at any time prior to August 1, 2000, the
Company may (but shall not have the obligation to) redeem up to one-third of the
original aggregate principal amount of the Senior Notes with the proceeds
A-6
of one or more Equity Offerings at a redemption price of 109.875% of the
principal amount thereof, plus any accrued and unpaid interest and Liquidated
Damages, if any, to the date of redemption; provided that at least two-thirds of
the aggregate principal amount of the Senior Notes originally issued remain
outstanding immediately after any such redemption; and provided, further, that
any such redemption shall occur within 60 days of the date of the closing of
such Equity Offering.
6. Mandatory Redemption. Subject to the Company's obligation to make an
offer to purchase Senior Notes under certain circumstances pursuant to Sections
4.13 and 4.14 of the Indenture (as described in paragraph 7 below), the Company
is not required to make any mandatory redemption, purchase or sinking fund
payments with respect to the Senior Notes.
7. Mandatory Offers to Purchase Senior Notes. (a) Upon the occurrence of a
Change of Control, each Holder of Senior Notes shall have the right to require
the Company to purchase all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Senior Notes pursuant to an Offer (as defined
herein) at a purchase price equal to 101% of the aggregate principal amount
thereof, plus any accrued and unpaid interest and Liquidated Damages, if any, to
the date of purchase.
(b) If the Company or any Restricted Subsidiary consummates one or
more Asset Sales and does not use all of the Net Proceeds from such Asset Sales
as provided in the Indenture, the Company will be required, under certain
circumstances, to utilize the Excess Proceeds from such Asset Sales to make an
Offer (as defined herein) to purchase Senior Notes at a purchase price equal to
100% of the principal amount of the Senior Notes, plus any accrued and unpaid
interest and Liquidated Damages, if any, to the date of purchase. If the Excess
Proceeds are insufficient to purchase all Senior Notes tendered pursuant to any
Asset Sale Offer, the Trustee shall select the Senior Notes to be purchased in
accordance with the terms of the Indenture.
(c) Holders may tender all or, subject to paragraph 8 below, any
portion of their Senior Notes in a Change of Control Offer or Asset Sale Offer
(collectively, an "Offer") by completing the form below entitled "OPTION OF
HOLDER TO ELECT PURCHASE."
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(d) The Company shall comply with Rule 14e-1 under the Exchange Act
and any other securities laws and regulations to the extent such laws and
regulations are applicable to any Offer. To the extent that the provisions of
any of such securities laws or regulations conflict with provisions of this
Indenture, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Indenture by virtue thereof.
8. Notice of Redemption or Purchase. Notice of an optional redemption or an
Offer will be mailed to each Holder at its registered address at least 30 days
but not more than 60 days before the date of redemption or purchase. Senior
Notes may be redeemed or purchased in part, but only in whole multiples of
$1,000 unless all Senior Notes held by a Holder are to be redeemed or purchased.
On or after any date on which Senior Notes are redeemed or purchased, interest
ceases to accrue on the Senior Notes or portions thereof called for redemption
or accepted for purchase on such date.
9. Denominations, Transfer, Exchange. The Senior Notes are in registered
form without coupons in denominations of $1,000 and integral multiples thereof.
The transfer of Senior Notes may be registered and Senior Notes may be
exchanged as provided in the Indenture. Holders seeking to transfer or exchange
their Senior Notes may be required, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Paying Agent need not exchange or
register the transfer of any Senior Note or portion of a Senior Note selected
for redemption or tendered pursuant to an Offer. Also, it need not exchange or
register the transfer of any Senior Notes for a period of 15 Business Days
before a selection of Senior Notes to be redeemed or purchased or between a
record date and the next succeeding Interest Payment Date.
10. Persons Deemed Owners. The registered Holder of a Senior Note may be
treated as its owner for all purposes.
11. Amendments and Waivers. Subject to certain exceptions, the Indenture or
the Senior Notes may be amended or supplemented with the consent of the Holders
of at least a majority in principal amount of the then outstanding Senior Notes,
and any existing Default (except a payment Default) may be waived with the
consent of the Holders of a majority in principal amount of the then outstanding
Senior Notes.
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Without the consent of any Holder, the Indenture or the Senior Notes may be
amended to: cure any ambiguity, defect or inconsistency; provide for
uncertificated Senior Notes in addition to or in place of certificated Senior
Notes; pro vide for the assumption of the Company's obligations in the event of
a merger or consolidation of the Company in which the Company is not the
surviving corporation or a sale of substantially all of the Company's assets to
such other corporation; comply with the Securities and Exchange Commission's
requirements to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; provide for additional Guarantees with respect to the
Senior Notes; or, make any change that does not materially adversely affect any
Holder's rights under the Indenture.
12. Defaults and Remedies. Events of Default include: default for 30 days
in payment of interest on, or Liquidated Damages, if any, with respect to, the
Senior Notes; default in payment when due of principal or premium, if any, with
respect to the Senior Notes; failure by the Company for 45 days after notice to
it to comply with any of its other agreements or covenants in, or provisions of,
the Indenture or the Senior Notes; certain defaults under and acceleration prior
to maturity of, or failure to pay at maturity, certain other Indebtedness;
certain final judgments that remain undischarged; and certain events of
bankruptcy or insolvency involving the Company or any Restricted Subsidiary that
is a Significant Subsidiary. If an Event of Default occurs and is continuing,
the Trustee or the Holders of at least 25% in principal amount of the Senior
Notes may declare all the Senior Notes to be immediately due and payable in an
amount equal to the principal of, premium, if any, and any accrued and unpaid
interest on, and Liquidated Damages, if any, with respect to such Senior Notes;
provided, however, that in the case of an Event of Default arising from certain
events of bankruptcy or insolvency, the principal of, premium, if any, and any
accrued and unpaid interest on, and Liquidated Damages, if any, with respect to
the Senior Notes becomes due and payable immediately without further action or
notice. Subject to certain exceptions, Holders of a majority in principal
amount of the then outstanding Senior Notes may direct the Trustee in its
exercise of any trust or power, provided that the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request of Holders unless such Holders have offered to the Trustee security and
indemnity satisfactory to it. Holders may not enforce the Indenture or the
Senior Notes except as provided in the Indenture. The Trustee may with-
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hold from Holders notice of any continuing default (except a payment Default) if
it determines that withholding notice is in their interests. The Company must
furnish an annual compliance certificate to the Trustee.
13. Trustee Dealings with the Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or any Affiliate, and may otherwise deal with the
Company or any Affiliate, as if it were not Trustee.
14. No Recourse Against Others. No officer, employee, director, stockholder
or Subsidiary of the Company shall have any liability for any Obligations of the
Company under the Senior Notes or the Indenture, or for any claim based on, in
respect of, or by reason of, such Obligations or the creation of any such
Obligation, except, in the case of a Subsidiary, for an express guarantee or an
express creation of any Lien by such Subsidiary of the Company's Obligations
under the Senior Notes. Each Holder by accepting a Senior Note waives and
releases all such liability, and such waiver and release is part of the
consideration for the issuance of the Senior Notes. The foregoing waiver may not
be effective to waive liabilities under the Federal securities law and the
Commission is of the view that such a waiver is against public policy.
15. Holders' Compliance with Registration Rights Agreement. Each Holder of
a Senior Note, by his acceptance thereof, acknowledges and agrees to the
provisions of the Registration Rights Agreement, dated as of July 25, 1997,
among the Company and the parties named on the signature page thereof (the
"Registration Rights Agreement"), including but not limited to the obligations
of the Holders with respect to a registration and the indemnification of the
Company and the Purchasers (as defined therein) to the extent provided therein.
16. Successor Substituted. Upon the consolidation or merger by the Company
with or into another corporation, or upon the sale, lease, conveyance or other
disposition of all or substantially all of its assets to another corporation, in
accordance with the Indenture, the corporation surviving any such merger or
consolidation (if not the Company) or the corporation to which such assets were
sold or transferred to shall succeed to, and be substituted for, and may
exercise every right and power of the Company under the Indenture
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with the same effect as if such surviving or other corporation had been named
as the Company in the Indenture.
17. Governing Law. This Senior Note shall be governed by and construed in
accordance with the internal laws of the State of New York without regard to the
conflict of laws provisions thereof.
18. Authentication. This Senior Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
19. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
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 Senior Notes and have directed the Trustee to
use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Senior Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers printed on the Senior Notes.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement, which
has in it the text of this Senior Note in larger type. Request may be made to:
Jordan Telecommunication Products, Inc.
ArborLake Centre, Suite 550
0000 Xxxx Xxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
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ASSIGNMENT FORM
To assign this Senior Note, fill in the form below:
(I) or (we) assign and transfer this Senior Note to:
_____________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_____________________________________________
_____________________________________________
_____________________________________________
(Print or type assignee's name,
address and zip code)
and irrevocably appoint ________________________________________________________
___________________________ as agent to transfer this Senior Note on the books
of the Company. The agent may substitute another to act for him.
Date:_____________ Your Signature:__________________________________
(Sign exactly as your name appears
on the other side of this Senior
Note)
Signature Guarantee:
__________________________
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OPTION OF HOLDER TO ELECT PURCHASE
If you elect to have this Senior Note purchased by the Company pursuant to
Section 4.13 of the Indenture, check the box: [_]
If you elect to have this Senior Note purchased by the Company pursuant to
Section 4.14 of the Indenture, check the box: [_]
If you elect to have only part of this Senior Note purchased by the Company
pursuant to Section 4.13 or 4.14 of the Indenture, state the amount (multiples
of $1000 only):
$__________________
Date:_____________ Your Signature:________________________________________
(Sign exactly as your name appears
on the other side of this Senior Note)
Signature Guarantee:
__________________________
Signature Guarantee:
___________________________
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SCHEDULE OF EXCHANGES OF DEFINITIVE SENIOR NOTES/2/
The following exchanges of a part of this Global Senior Note for Definitive
Senior Notes have been made:
Principal Amount of this Signature of
Amount of decrease in Amount of increase in Global Senior Note authorized officer of
Principal Amount of Principal Amount of following such decrease Trustee or Senior
Date of Exchange this Global Senior Note this Global Senior Note (or increase) Note Custodian
---------------- ----------------------- ----------------------- ------------------------ ---------------------
-----------------------
/2/ This should be included only if the Senior Note is issued in global form.
A-14
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SENIOR NOTES
______________, ______
Re: 9 7/8% Series [A/B] Senior Notes due 2007 of Jordan Telecommunication
Products, Inc.
This Certificate relates to $______ principal amount of Senior Notes held in
/*/ _____ book-entry or /*/ _____ definitive form by _____ (the "Transferor").
The Transferor/*/:
[_] has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Global Senior Note held by the Depositary a
Senior Note or Senior Notes in definitive, registered form equal to its
beneficial interest in such Global Senior Note (or the portion thereof indicated
above); or
[_] has requested the Trustee by written order to exchange or register the
transfer of a Senior Note or Senior Notes.
In connection with such request and in respect of each such Senior Note,
the Transferor does hereby certify that the Transferor is familiar with the
Indenture relating to the above captioned Senior Notes and that the transfer of
this Senior Note does not require registration under the Securities Act (as
defined below) because:/*/
[_] Such Senior Note is being acquired for the Transferor's own account
without transfer (in satisfaction of Section 2.6(a)(ii)(A) or Section
2.6(d)(i)(A) of the Indenture).
[_] Such Senior Note is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance on Rule 144A.
-----------------
/*/Check applicable box.
B-1
[_] Such Senior Note is being transferred (i) in accordance with Rule 144
under the Securities Act (and based on an opinion of counsel if the Company so
requests) or (ii) pursuant to an effective registration statement under the
Securities Act.
[_] Such Senior Note is being transferred to an institutional accredited
investor within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act pursuant to a private placement exemption from the registration
requirements of the Securities Act (and based on an opinion of counsel if the
Company so requests together with a certification in substantially the form of
Exhibit C to the Indenture).
[_] Such Senior Note is being transferred in reliance on and in
compliance with another exemption from the registration requirements of the
Securities Act (and based on an opinion of counsel if the Company so requests).
-----------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
--------------------------------------
Name:
Title:
Address:
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EXHIBIT C
FORM OF CERTIFICATE TO BE DELIVERED BY
INSTITUTIONAL ACCREDITED INVESTORS
-----------, ------
__________________, as Registrar
Attention: Corporate Trust Department
Ladies and Gentlemen:
In connection with our proposed purchase of certain 9 7/8% Series [A/B]
Senior Notes due 2007 (the "Senior Notes") of Jordan Telecommunication Products,
Inc., a Delaware corporation (the "Company"), we represent that:
(i) we are an "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act (an "Institutional
Accredited Investor"), or an entity in which all of the equity owners are
Institutional Accredited Investors;
(ii) any purchase of Senior Notes will be for our own account or
for the account of one or more other Institutional Accredited Investors as
to which we exercise sole investment discretion;
(iii) we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits and risks of
purchasing Senior Notes and we and any accounts for which we are acting are
able to bear the economic risks of our or their investment;
(iv) we are not acquiring Senior Notes with a view to any
distribution thereof in a transaction that would violate the Securities Act
or the securities laws of any State of the United States or any other
applicable jurisdiction; provided that the disposition of our property and
the property of any accounts for which we are acting as fiduciary shall
remain at all times within our control; and
C-1
(v) we acknowledge that we have had access to such financial and
other information, and have been afforded the opportunity to ask such
questions of representatives of the Company and receive answers thereto, as
we deem necessary in connection with our decision to purchase Senior Notes.
We understand that the Senior Notes have not been registered under the
Securities Act, and we agree, on our own behalf and on behalf of each account
for which we acquire any Senior Notes, that such Senior Notes may be offered,
resold, pledged or otherwise transferred only (i) to a person whom we reasonably
believe to be a qualified institutional buyer (as defined in Rule 144A under
the Securities Act) in a transaction meeting the requirements of Rule 144A, in a
transaction meeting the requirements of Rule 144 under the Securities Act, (ii)
to the Company or (iii) pursuant to an effective registration statement, and, in
each case, in accordance with any applicable securities laws of any State of the
United States or any other applicable jurisdiction. We understand that the
registrar will not be required to accept for registration of transfer any Senior
Notes, except upon presentation of evidence satisfactory to the Company that the
foregoing restrictions on transfer have been complied with. We further
understand that the Senior Notes purchased by us will be in the form of
definitive physical certificates and that such certificates will bear a legend
reflecting the substance of this paragraph. We further agree to provide to any
person acquiring any of the Senior Notes from us a notice advising such person
that resales of the Senior Notes are restricted as stated herein.
We acknowledge that you, the Company and others will rely upon our
confirmations, acknowledgements and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
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THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS
THEREOF.
Very truly yours,
--------------------------------
[Name of Transferor]
By:
--------------------------------
Name:
Title:
Address:
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