EXHIBIT NO. 4.1
INDENTURE dated as of February 29, 1996,
between HEXCEL CORPORATION, a Delaware
corporation (the "Company"), and FIRST TRUST OF
CALIFORNIA, NATIONAL ASSOCIATION, a national
banking association (the "Trustee").
WHEREAS, the Company is party to the Strategic
Alliance Agreement (as defined herein), which provides that
the Company shall issue Securities (as defined herein)
(i) pursuant to Section 2.04(g) of the Strategic Alliance
Agreement, on the date provided therein, to bear interest
from the Closing (as defined in the Strategic Alliance
Agreement), (ii) pursuant to Section 2.03(a) of the
Strategic Alliance Agreement, on the Deferred Consideration
Payment Date (as defined in the Strategic Alliance
Agreement), to bear interest from such date and
(iii) pursuant to Section 2.05(d) of the Strategic Alliance
Agreement, on the date of the Danutec Closing (as defined in
the Strategic Alliance Agreement), to bear interest from
such date;
NOW, THEREFORE, 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 Increasing
Rate Senior Subordinated Notes due 2003 (the "Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquisition" means the acquisition by the
Company and certain Subsidiaries of the global composites
business of Ciba-Geigy Limited.
"Additional Assets" means any (i) property or
assets (other than Indebtedness and Capital Stock) to be
used by the Company or a Subsidiary; (ii) Capital Stock of a
Person that becomes a Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another
Subsidiary; or (iii) Capital Stock constituting a minority
interest in any Person that at such time is a Subsidiary.
"Affiliate" of any specified Person means
(i) any other Person, directly or indirectly, controlling or
controlled by or under direct or indirect common control
with such specified Person or (ii) any other Person who is a
director or officer (A) of such specified Person, (B) of any
Subsidiary of such specified Person or (C) of any Person
described in clause (i). For the purposes of this
definition, "control" when used with respect to any Person
means the power to direct the management and policies of
such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings
correlative to the foregoing. For purposes of Sections 4.06
and 4.07 only, "Affiliate" shall also mean any beneficial
owner of shares representing 5% or more of the total voting
power of the Voting Stock (on a fully diluted basis) of the
Company or of rights or warrants to purchase such Voting
Stock (whether or not currently exercisable) and any Person
who would be an Affiliate of any such beneficial owner
pursuant to the first sentence hereof. So long as the
Governance Agreement is in effect, none of the Permitted
Holders shall be deemed an Affiliate of the Company for
purposes of Section 4.07.
"Asset Disposition" means any direct or
indirect sale, lease, transfer, conveyance or other
disposition (or series of related sales, leases, transfers,
conveyances or dispositions) of shares of Capital Stock of a
Subsidiary (other than directors' qualifying shares),
property or other assets (each referred to for the purposes
of this definition as a "disposition") by the Company or any
Subsidiary (including any disposition by means of a merger,
consolidation or similar transaction) involving an amount in
excess of $1,000,000 other than (i) a disposition by a
Subsidiary to the Company, by the Company or a Subsidiary to
a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries, (ii) a disposition of property or assets at
fair market value in the ordinary course of business and
consistent with past practices of the Company or any of its
Subsidiaries, as applicable (including sales of products to
customers, disposition of excess inventory and dispositions
of used or replaced equipment), and (iii) for purposes of
Section 4.06 only, a disposition subject to Section 4.04;
provided, that for purposes of the definition of
Consolidated Coverage Ratio, Asset Disposition shall include
all such asset dispositions regardless of amount.
"Average Life" means, as of the date of
determination, with respect to any Indebtedness, the
quotient obtained by dividing (i) the sum of the products of
the numbers of years from the date of determination to the
date of each successive scheduled principal payment of such
Indebtedness or scheduled redemption multiplied by the
amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all
Indebtedness and other amounts payable under or in respect
of the Credit Agreement including, without limitation,
principal, premium (if any), interest (including interest
accruing at the contract rate specified in the Credit
Agreement (including, without limitation, any rate
applicable upon default) on or after the filing of any
petition in bankruptcy, or the commencement of any similar
state, federal or foreign reorganization or liquidation
proceeding, relating to the Company and interest that would
accrue but for the commencement of such proceeding whether
or not a claim for post-filing interest is allowed in such
proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable
thereunder or in respect thereof.
"Board of Directors" means the Board of
Directors of the Company or any committee thereof duly
authorized to act on behalf of such Board.
"Board Resolution" means a duly adopted
resolution of the Board of Directors in full force and
effect at the time of determination and certified as such by
the Secretary or an Assistant Secretary of the Company.
"Business Day" means each day which is not a
Legal Holiday.
"Capitalized Lease Obligation" means an
obligation that is required to be classified and accounted
for as a capitalized lease for financial reporting purposes
in accordance with GAAP; and the amount of Indebtedness
represented by such obligation shall be the capitalized
amount of such obligation determined in accordance with
GAAP; and the Stated Maturity thereof shall be the date of
the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
"Capital Stock" of any Person means any and all
shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests
(including partnership interests) in (however designated)
equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.
"Cash Equivalents" means (i) marketable direct
obligations issued or unconditionally guaranteed by the
United States government and backed by the full faith and
credit of the United States government; (ii) domestic and
Eurodollar certificates of deposit and time deposits,
bankers' acceptances and floating rate certificates of
deposit issued by any commercial bank organized under the
laws of the United States, any state thereof, the District
of Columbia, any foreign bank, or its branches or agencies
(fully protected against currency fluctuations), which, at
the time of acquisition, are rated A-1 (or better) by
Standard & Poor's Corporation (or its successors) or P-1 (or
better) by Xxxxx'x Investors Service, Inc. (or its
successors); (iii) commercial paper of United States and
foreign banks and bank holding companies and their
subsidiaries and United States and foreign finance,
commercial industrial or utility companies which, at the
time of acquisition, are rated A-1 (or better) by Standard &
Poor's Corporation (or its successors) or P-1 (or better) by
Xxxxx'x Investors Service, Inc. (or its successors);
(iv) marketable direct obligations of any state of the
United States of America or any political subdivision of any
such state given on the date of such investment the highest
credit rating by Xxxxx'x Investor Service, Inc. (or its
successors) and Standard & Poor's Corporation (or its
successors); and (v) reverse purchase agreement covering
obligations of the type specified in clause (i); provided
that the maturities of any such Cash Equivalents referred to
in clauses (i) through (v) shall not exceed one hundred
eighty (180) days.
"Change of Control" means the occurrence of any
of the following events: (i) (A) any "person" (as such term
is used in Sections 13(d) and 14(d) of the Exchange Act),
other than (x) one or more Permitted Holders or (y) an
underwriter engaged in a firm commitment underwriting in
connection with a public offering of the Voting Stock of the
Company, is or becomes the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a
person shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than
35% of the total voting power of the Voting Stock of the
Company and (B) the Permitted Holders "beneficially own" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, in the aggregate a lesser percentage
of the total voting power of the Voting Stock of the Company
than such other person "beneficially owns" (as defined in
clause (A)) and do not have the right or ability by voting
power, contract or otherwise to elect or designate for
election a majority of the Board of Directors (for the
purposes of this clause (i), such other person shall be
deemed to beneficially own any Voting Stock of a specified
corporation held by a parent corporation, if such other
person "beneficially owns" (as defined in clause (A)),
directly or indirectly, more than 35% of the voting power of
the Voting Stock of such parent corporation and the
Permitted Holders "beneficially own" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate a lesser percentage of the
voting power of the Voting Stock of such parent corporation
than such other person "beneficially owns" (as defined in
clause (A)) and do not have the right or ability by voting
power, contract or otherwise to elect or designate for
election a majority of the board of directors of such parent
corporation); (ii) during any period of two consecutive
years, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together
with any new directors whose election by such Board of
Directors or whose nomination for election by the
shareholders of the Company was approved pursuant to the
Governance Agreement or by a vote of 66-2/3% of the
directors of the Company then still in office who were
either directors at the beginning of such period or whose
election or nomination for election was previously so
approved) cease for any reason to constitute a majority of
the Board of Directors then in office; or (iii) the Company
sells, conveys, leases or otherwise transfers all or
substantially all its assets to any Person pursuant to a
transaction in which any holder of the Voting Stock of the
Company immediately prior to such transaction "beneficially
owns" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, a lesser amount of
the Voting Stock of the Person that acquired such assets
immediately after such transaction.
"Ciba" means CIBA-GEIGY Limited, a corporation
organized under the laws of Switzerland.
"Closing" shall have the meaning assigned
thereto in the Strategic Alliance Agreement.
"Code" means the Internal Revenue Code of 1986,
as amended.
"Company" means the party named as such in this
Indenture until a successor replaces it and, thereafter,
means the successor.
"Consolidated Coverage Ratio" as of any date of
determination means the ratio of (i) the aggregate amount of
EBITDA for the period of the most recent four consecutive
fiscal quarters ending at least 45 days prior to the date of
such determination to (ii) Consolidated Interest Expense for
such four fiscal quarters; provided, however, that (1) if
the Company or any Subsidiary has Incurred any Indebtedness
since the beginning of such period that remains outstanding
on such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage
Ratio is an Incurrence of Indebtedness, EBITDA and
Consolidated Interest Expense for such period shall be
calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on
the first day of such period and the discharge of any other
Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if
such discharge had occurred on the first day of such period,
(2) if since the beginning of such period the Company or any
Subsidiary shall have made any Asset Disposition, the EBITDA
for such period shall be reduced by an amount equal to the
EBITDA (if positive) directly attributable to the assets
which are the subject of such Asset Disposition for such
period or increased by an amount equal to the EBITDA (if
negative) directly attributable thereto for such period and
Consolidated Interest Expense for such period shall be
reduced by an amount equal to the Consolidated Interest
Expense directly attributable to any Indebtedness of the
Company or any Subsidiary repaid, repurchased, defeased or
otherwise discharged with respect to the Company and its
continuing Subsidiaries in connection with such Asset
Disposition for such period (or, if the Capital Stock of any
Subsidiary is sold, the Consolidated Interest Expense for
such period directly attributable to the Indebtedness of
such Subsidiary to the extent the Company and its continuing
Subsidiaries are no longer liable for such Indebtedness
after such sale), (3) if since the beginning of such period
the Company or any Subsidiary (by merger or otherwise) shall
have made an Investment in any Subsidiary (or any Person
which becomes a Subsidiary) or an acquisition of assets,
including any acquisition of assets occurring in connection
with a transaction causing a calculation to be made
hereunder, which constitutes all or substantially all of an
operating unit of a business, EBITDA and Consolidated
Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of
any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period and (4) if since
the beginning of such period any Person (that subsequently
became a Subsidiary or was merged with or into the Company
or any Subsidiary since the beginning of such period) shall
have made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment
pursuant to clause (2) or (3) above if made by the Company
or a Subsidiary during such period, EBITDA and Consolidated
Interest Expense for such period shall be calculated after
giving pro forma effect thereto as if such Asset
Disposition, Investment or acquisition of assets occurred on
the first day of such period. For purposes of this
definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings
relating thereto and the amount of Consolidated Interest
Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be
determined in good faith by a responsible financial or
accounting Officer of the Company. If any Indebtedness bears
a floating rate of interest and is being given pro forma
effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire
period (taking into account any Interest Rate Protection
Agreement applicable to such Indebtedness if such Interest
Rate Protection Agreement has a remaining term as at the
date of determination in excess of 12 months).
"Consolidated Interest Expense" means, for any
period, the total interest expense of the Company and its
consolidated Subsidiaries, plus, to the extent not included
in such interest expense, (i) interest expense attributable
to capital leases, (ii) amortization of debt discount and
debt issuance cost, (iii) capitalized interest, (iv) non-
cash interest expense, (v) accrued interest,
(vi) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance
financing, (vii) interest actually paid by the Company or
any such Subsidiary under any Guarantee of Indebtedness or
other obligation of any other Person, (viii) net costs
associated with Hedging Obligations (including amortization
of fees), (ix) the interest portion of any deferred
obligation, (x) Preferred Stock dividends in respect of all
Preferred Stock of Subsidiaries and Redeemable Stock of the
Company held by Persons other than the Company or a Wholly
Owned Subsidiary and (xi) cash contributions to any employee
stock ownership plan or other trust for the benefit of
employees to the extent such contributions are used by such
plan or trust to pay interest or fees to any Person (other
than the Company) in connection with Indebtedness Incurred
by such plan or trust.
"Consolidated Net Income" means, for any
period, the net income (loss) of the Company and its
consolidated Subsidiaries; provided, however, that there
shall not be included in such Consolidated Net Income
(i) any net income (loss) of any Person if such Person is
not a Subsidiary, except that (A) subject to the limitations
contained in clause (iv) below, the Company's equity in the
net income of any such Person for such period shall be
included in such Consolidated Net Income up to the aggregate
amount of cash actually distributed by such Person during
such period to the Company or a Subsidiary as a dividend or
other distribution (subject, in the case of a dividend or
other distribution to a Subsidiary, to the limitations
contained in clause (iii) below) and (B) the Company's
equity in a net loss of any such Person for such period
shall be included in determining such Consolidated Net
Income, (ii) any net income (loss) of any person acquired by
the Company or a Subsidiary in a pooling of interests
transaction for any period prior to the date of such
acquisition, (iii) any net income (loss) of any Subsidiary
if such Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of
distributions by such Subsidiary, directly or indirectly, to
the Company, except that (A) subject to the limitations
contained in (iv) below, the Company's equity in the net
income of any such Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate
amount of cash that could have been distributed by such
Subsidiary during such period to the Company or another
Subsidiary as a dividend (subject, in the case of a dividend
to another Subsidiary, to the limitation contained in this
clause) and (B) the Company's equity in a net loss of any
such Subsidiary for such period shall be included in
determining such Consolidated Net Income, (iv) any gain (but
not loss) realized upon the sale or other disposition of any
property, plant or equipment of the Company or its
consolidated Subsidiaries (including pursuant to any sale-
and-leaseback transaction) which is not sold or otherwise
disposed of in the ordinary course of business and any gain
(but not loss) realized upon the sale or other disposition
of any Capital Stock of any Person, (v) any extraordinary
gain or loss and (vi) the cumulative effect of a change in
accounting principles.
"Consolidated Net Worth" means the total of the
amounts shown on the balance sheet of the Company and its
consolidated Subsidiaries, determined on a consolidated
basis in accordance with GAAP, as of the end of the most
recent fiscal quarter of the Company ending at least 45 days
prior to the taking of any action for the purpose of which
the determination is being made, as (i) the par or stated
value of all outstanding Capital Stock of the Company plus
(ii) paid-in capital or capital surplus relating to such
Capital Stock plus (iii) any retained earnings or earned
surplus less (A) any accumulated deficit and (B) any amounts
attributable to Disqualified Stock.
"Credit Agreement" means, collectively, the
Credit Agreement dated as of February 29, 1996, among the
Company, certain of its Subsidiaries, the financial
institutions from time to time party thereto as Lenders and
Issuing Banks, Citibank, N.A., in its separate capacity as
administrative agent for the Lenders and Issuing Banks,
Citibank International plc, in its separate capacity as
European administrative agent for the Lenders and Issuing
Banks, and Credit Suisse, in its separate capacity as
syndication agent for the Lenders and Issuing Banks, as the
same may from time to time be amended, renewed, supplemented
or otherwise modified at the option of the parties thereto,
and any other agreement pursuant to which any of the
Indebtedness, commitments, obligations, costs, expenses,
fees, reimbursements and other indemnities payable or owing
thereunder may be replaced or refinanced, in any such event
having an aggregate principal amount and availability not in
excess of $175,000,000 plus amounts otherwise permitted
pursuant to Section 4.03(b)(i).
"Currency Exchange Protection Agreement" means,
in respect of any Person, any foreign exchange contract,
currency swap agreement, currency option or other similar
agreement or arrangement designed to protect such Person
against fluctuations in currency exchange rates.
"Default" means any event which is, or after
notice or passage of time or both would be, an Event of
Default.
"Designated Senior Indebtedness" means (i) the
Bank Indebtedness and (ii) any other Senior Indebtedness
which, at the date of determination, has an aggregate
principal amount outstanding of, or under which, at the date
of determination, the holders thereof, are committed to lend
up to, at least $45 million and is specifically designated
by the Company in the instrument evidencing or governing
such Senior Indebtedness as "Designated Senior Indebtedness"
for purposes of this Indenture and has been designated as
"Designated Senior Indebtedness" for purposes of this
Indenture in an Officers' Certificate received by the
Trustee.
"DIC" means the joint venture entered into
between the Company and Dainippon Ink & Chemicals, Inc.
("Dainippon"), pursuant to that certain Parent Company
Agreement dated as of April 17, 1990 under which the Company
and Dainippon caused Hexcel Technologies, Inc. and DIC
Technologies, Inc., (wholly-owned subsidiaries of the
Company and Dainippon Ink & Chemicals, Inc., respectively)
to enter into that certain Participants Agreement dated as
of September 14, 1990 pursuant to which Hexcel Technologies,
Inc. and DIC Technologies, Inc. formed Hexcel-DIC
Partnership ("HDP") and pursuant to which Hexcel
Technologies, Inc. and DIC Technologies Inc., caused HDP to
form DIC-Hexcel, Ltd. as a wholly-owned subsidiary of HDP.
"Disqualified Stock" of a Person means
Redeemable Stock of such Person as to which the maturity,
mandatory redemption, conversion or exchange or redemption
at the option of the holder thereof occurs, or may occur, on
or prior to the first anniversary of the Stated Maturity of
the Securities.
"Dollar Equivalent" means, with respect to any
monetary amount in a currency other than U.S. dollars, at
any time for the determination thereof, the amount of U.S.
dollars obtained by converting such foreign currency
involved in such computation into U.S. dollars at the spot
rate for the purchase of U.S. dollars with the applicable
foreign currency as quoted by Bankers Trust Company in
New York City at approximately 11:00 a.m. (New York time) on
the date two Business Days prior to such determination.
"EBITDA" for any period means the Consolidated
Net Income for such period, plus the following to the extent
deducted in calculating such Consolidated Net Income:
(i) income tax expense, (ii) Consolidated Interest Expense,
(iii) depreciation expense and (iv) amortization expense, in
each case for such period.
"Exchange Act" means the Securities Exchange
Act of 1934, as amended.
"Existing Joint Ventures" means (i) Knytex,
(ii) DIC and (iii) Xxxx.
"fair market value" means, with respect to any
asset or property, the price which could be negotiated in an
arms'-length free market transaction between a willing
seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction.
"Xxxx" means Hexcel Xxxx L.L.C., a Delaware
limited liability company.
"GAAP" means generally accepted accounting
principles in the United States of America as in effect at
the time of the Closing, including those set forth in the
opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant
segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall
be computed in conformity with GAAP consistently applied.
"Governance Agreement" means the Governance
Agreement dated as of February 29, 1996, between Ciba and
the Company.
"Guarantee" means any obligation, contingent or
otherwise, of any Person directly or indirectly guaranteeing
any Indebtedness or other obligation of any other Person and
any obligation, direct or indirect, contingent or otherwise,
of such Person (i) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or
other obligation of such other Person (whether arising by
virtue of partnership arrangements, or by agreement to keep-
well, to purchase assets, goods, securities or services, to
take-or-pay or to maintain financial statement conditions or
otherwise) or (ii) entered into for purposes of assuring in
any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part);
provided, however, that the term "Guarantee" shall not
include (i) endorsements for collection or deposit in the
ordinary course of business or (ii) obligations, warranties
and indemnities, not with respect to Indebtedness of any
Person, that have been or are undertaken or made in the
ordinary course of business or in connection with any Asset
Disposition permitted by Section 4.06 and not for the
benefit of or in favor of an Affiliate of the Company or any
of its Subsidiaries. The term "Guarantee" used as a verb
has a corresponding meaning.
"Hedging Obligations" of any Person means the
obligations of such Person pursuant to any Interest Rate
Protection Agreement or Currency Exchange Protection
Agreement or other similar agreement or arrangement
involving interest rates, currencies, commodities or
otherwise.
"Holder" or "Securityholder" means the Person
in whose name a Security is registered on the Registrar's
books.
"Incur" means issue, assume, Guarantee, incur
or otherwise become liable for; provided, however, that any
Indebtedness or Capital Stock of a Person existing at the
time such person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to
be incurred by such Subsidiary at the time it becomes a
Subsidiary. The terms "Incurred", "Incurrence" and
"Incurring" shall each have a correlative meaning.
"Indebtedness" means, with respect to any
Person on any date of determination (without duplication),
(i) the principal of and premium (if any) in
respect of indebtedness of such Person for
borrowed money;
(ii) the principal of and premium (if any) in
respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar
instruments;
(iii) all Capitalized Lease Obligations of such
Person;
(iv) all obligations of such Person to pay the
deferred and unpaid purchase price of property or
services (except Trade Payables);
(v) all obligations of such Person in respect
of letters of credit, banker's acceptances or
other similar instruments or credit transactions
(including reimbursement obligations with respect
thereto), other than obligations with respect to
letters of credit securing obligations (other than
obligations described in (i) through (iv) above)
entered into in the ordinary course of business of
such Person to the extent such letters of credit
are not drawn upon or, if and to the extent drawn
upon, such drawing is reimbursed no later than the
third Business Day following receipt by such
Person of a demand for reimbursement following
payment on any such letter of credit;
(vi) the amount of all obligations of such
Person with respect to the redemption, repayment
or other repurchase of any Disqualified Stock or,
with respect to any Subsidiary, any Preferred
Stock (but excluding, in each case, any accrued
dividends);
(vii) all Indebtedness of other Persons secured
by a Lien on any asset of such Person, whether or
not such Indebtedness is assumed by such Person;
provided, however, that the amount of such
Indebtedness shall be the lesser of (A) the fair
market value of such asset at such date of
determination and (B) the amount of such
Indebtedness of such other Persons;
(viii) all Indebtedness of other Persons to the
extent Guaranteed by such Person; and
(ix) to the extent not otherwise included in
this definition, obligations of such Person in
respect of Hedging Obligations.
For purposes of this definition, the maximum fixed
redemption, repayment or repurchase price of any
Disqualified Stock or Preferred Stock that does not have a
fixed redemption, repayment or repurchase price shall be
calculated in accordance with the terms of such Stock as if
such Stock were redeemed, repaid or repurchased on any date
on which Indebtedness shall be required to be determined
pursuant to the Indenture; provided, however, that if such
Stock is not then permitted to be redeemed, repaid or
repurchased, the redemption, repayment or repurchase price
shall be the book value of such Stock as reflected in the
most recent financial statements of such Person. The amount
of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional
obligations as described above and the maximum liability,
upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date.
"Indenture" means this instrument as originally
executed or as it may from time to time be supplemented or
amended by one or more indentures supplemental hereto
entered into pursuant to the applicable provisions hereof.
"Interest Rate Protection Agreement" means, in
respect of any Person, any interest rate swap agreement,
interest rate option agreement, interest rate cap agreement,
interest rate collar agreement, interest rate floor
agreement or other similar agreement or arrangement designed
to protect such Person against fluctuations in interest
rates.
"Investment" in any Person means any direct or
indirect advance, loan (other than advances to customers or
suppliers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of such
Person) or other extension of credit (including by way of
Guarantee or similar arrangement) or capital contribution to
(by means of any transfer of cash or other property to
others or any payment for property or services for the
account or use of others), or any purchase or acquisition of
Capital Stock, Indebtedness or other similar instruments
issued by such Person. For purposes of Section 4.04,
(i) "Investment" shall include the portion (proportionate to
the Company's equity interest in such Subsidiary) of the
fair market value of the net assets of any Subsidiary of the
Company, (ii) any property transferred to or from a
Subsidiary shall be valued at its fair market value at the
time of such transfer and (iii) "Investment" shall not
include any Guaranty or other Indebtedness existing at the
time of the Closing owed by the Company or any of its
Subsidiaries in respect of Dainippon Ink & Chemicals, Inc.
or Hexcel-DIC Partnership. In determining the amount of any
Investment in respect of any property or assets other than
cash, such property or asset shall be valued at its fair
market value at the time of such Investment (unless
otherwise specified in this definition), as determined in
good faith by the Board of Directors, whose determination
shall be evidenced by a Board Resolution (if the value of
the such property or asset is greater than $3,000,000).
"Issue Date" means the date on which the
Securities are originally issued.
"Knytex" means the joint venture entered into
between the Company and Xxxxx-Xxxxxxx Fiberglas Corporation
pursuant to a Limited Liability Company Agreement dated as
of June 14, 1993 for the production and marketing of, among
other items, stitchbonded fabrics.
"Knytex Credit Facility" means that certain
$4,500,000 revolving credit facility entered into between
Knytex and Creekwood Capital Corporation pursuant to a Loan
Agreement dated as of January 26, 1995.
"Lenders" has the meaning specified in the
Credit Agreement.
"Lien" means any mortgage, pledge, security
interest, encumbrance, lien or charge of any kind (including
any conditional sale or other title retention agreement or
lease in the nature thereof).
"Maximum Partnership/Joint Venture Investment
Amount" means the sum, without duplication, of (i) all cash
Investments made by the Company after the time of the
Closing, plus (ii) all Investments that the Company is under
a contractual obligation to make after the time of the
Closing, plus (iii) the amount of all Guarantees incurred
after the time of the Closing, in each case in or on behalf
of any partnership in which the Company or any Subsidiary is
a general or limited partner or any joint venture (other
than the Existing Joint Ventures) to which the Company or
any Subsidiary is a party.
"Net Available Cash" from an Asset Disposition
means cash payments received (including any cash payments
received by way of deferred payment of principal pursuant to
a note or installment receivable or otherwise, but only as
and when received, but excluding any other consideration
received in the form of assumption by the acquiring person
of Indebtedness or other obligations relating to such
properties or assets or received in any other noncash form)
therefrom, in each case net of (i) all legal, title and
recording tax expenses, commissions and other fees and
expenses incurred, and all Federal, state, provincial,
foreign and local taxes required to be paid or accrued as a
liability under GAAP as a consequence of such Asset
Disposition, (ii) all payments made on any Indebtedness
which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon
such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by
applicable law, be repaid out of the proceeds from such
Asset Disposition, (iii) all distributions and other
payments required to be made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset
Disposition and (iv) the deduction of appropriate amounts to
be provided by the seller as a reserve, in accordance with
GAAP, against any liabilities associated with the assets
disposed of in such Asset Disposition and retained by the
Company or any Subsidiary after such Asset Disposition.
"Net Cash Proceeds", with respect to any
issuance or sale of Capital Stock, means the cash proceeds
of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other
fees actually incurred in connection with such issuance or
sale and net of taxes paid or payable as a result thereof.
"Officer" means the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President,
the Chief Financial Officer, the Treasurer, the Comptroller
or the Secretary of the Company.
"Officers' Certificate" means a certificate
signed by two Officers or by an Officer and an Assistant
Secretary of the Company.
"Opinion of Counsel" means a written opinion
from legal counsel who is acceptable to the Trustee. The
counsel may be an employee of or counsel to the Company or
the Trustee.
"pari passu", as applied to the ranking of any
Indebtedness of a Person in relation to other Indebtedness
of such Person, means that each such Indebtedness either
(i) is not subordinate in right of payment to any
Indebtedness or (ii) is subordinate in right of payment to
the same Indebtedness as is the other, and is so subordinate
to the same extent, and is not subordinate in right of
payment to each other or to any Indebtedness as to which the
other is not so subordinate.
"Permitted Holders" means, collectively, Ciba,
its Affiliates, and any successor corporation of, and any
corporation succeeding to ownership of, any thereof.
"Permitted Investment" means an Investment by
the Company or any Subsidiary in (i) a Subsidiary or a
Person which will, upon the making of such Investment,
become a Subsidiary; provided, however, that the primary
business of such Subsidiary is a Related Business; (ii)
another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers
or conveys all or substantially all its assets to, the
Company or a Subsidiary; provided, however, that such
Person's primary business is a Related Business;
(iii) Temporary Cash Investments; (iv) receivables owing to
the Company or any Subsidiary, if created or acquired in the
ordinary course of business and payable or dischargeable in
accordance with customary trade terms; provided, however,
that such trade terms may include such concessionary trade
terms as the Company or any such Subsidiary deems reasonable
under the circumstances; (v) payroll, travel and similar
advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for
accounting purposes and that are made in the ordinary course
of business; (vi) loans or advances to employees made in the
ordinary course of business consistent with past practices
of the Company or such Subsidiary, as the case may be; and
(vii) stock, obligations or securities received (a) in
settlement of debts created in the ordinary course of
business and owing to the Company or any Subsidiary, (b) in
satisfaction of judgments or (c) as consideration in
connection with an Asset Disposition permitted by
Section 4.06; provided that, in the case of this clause (c),
such stock, obligations or securities shall constitute no
more than 25% of the total consideration received therefrom
by the Company or any Subsidiary.
"Person" means any individual, corporation,
limited liability or other company, partnership, joint
venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Preferred Stock", as applied to the Capital
Stock of any corporation, means Capital Stock of any class
or classes (however designated) which is preferred as to the
payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution
of such corporation, over shares of Capital Stock of any
other class of such corporation.
"principal" of a Security means the principal
of the Security, if any, payable on the Security which is
due or overdue or is to become due at the relevant time.
"pro forma" means, with respect to any
calculation made or required to be made pursuant to the
terms hereof, a calculation in accordance with Article 11 of
Regulation S-X promulgated under the Securities Act (to the
extent applicable), as interpreted in good faith by the
Board of Directors after consultation with the independent
certified public accountants of the Company, or otherwise a
calculation made in good faith by the Board of Directors
after consultation with the independent certified public
accountants of the Company, as the case may be.
"Redeemable Stock" means, with respect to any
Person, any Capital Stock which by its terms (or by the
terms of any security into which it is convertible or for
which it is exchangeable) or upon the happening of any event
(i) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (ii) is convertible or
exchangeable for Indebtedness (other than Preferred Stock)
or Disqualified Stock or (iii) is redeemable at the option
of the holder thereof, in whole or in part.
"Refinancing Indebtedness" means Indebtedness
that refunds, refinances, replaces, renews, repays or
extends (including pursuant to any defeasance or discharge
mechanism) (collectively, "refinances," and "refinanced"
shall have a correlative meaning) any Indebtedness existing
at the time of the Closing or Incurred in compliance with
this Indenture (including Indebtedness of the Company that
refinances Indebtedness of any Subsidiary and Indebtedness
of any Subsidiary that refinances Indebtedness of another
Subsidiary) including Indebtedness that refinances
Refinancing Indebtedness; provided, however, that (i) the
Refinancing Indebtedness has a Stated Maturity no earlier
than any Stated Maturity of the Indebtedness being
refinanced, (ii) the Refinancing Indebtedness has an Average
Life at the time such Refinancing Indebtedness is Incurred
that is equal to or greater than the Average Life of the
Indebtedness being refinanced and (iii) such Refinancing
Indebtedness is Incurred in an aggregate principal amount
(or if issued with original issue discount, an aggregate
issue price) that is equal to or less than the aggregate
principal amount (or if issued with original issue discount,
the aggregate accreted value) of the Indebtedness being
refinanced (including, with respect to both the Refinancing
Indebtedness and the Indebtedness being refinanced, amounts
then outstanding and amounts available thereunder); provided
further, however, that Refinancing Indebtedness shall not
include Indebtedness of a Subsidiary that refinances
Indebtedness of the Company.
"Representative" means the trustee, agent or
other representative (if any) for an issue of Senior
Indebtedness.
"SEC" means the Securities and Exchange
Commission.
"Secured Indebtedness" means any Indebtedness
of the Company secured by a Lien.
"Securities" means the Securities issued under
this Indenture without regard to the series of which the
Securities are a part, except to the extent provided in the
fourth paragraph of Section 2.02 of this Indenture.
"Securities Act" means the Securities Act of
1933, as amended.
"Senior Indebtedness" means (i) all Bank
Indebtedness and (ii) all other Indebtedness of the Company,
including interest (including, without limitation, interest
accruing at the contract rate specified in the Credit
Agreement or the documentation governing such other
Indebtedness, as applicable (including, without limitation,
any rate applicable upon default) on or after the filing of
any petition in bankruptcy, or the commencement of any
similar state, federal or foreign reorganization or
liquidation proceeding, relating to the Company, whether or
not allowed as a claim against the Company in any such
proceeding) and fees thereon, whether outstanding at the
time of the Closing or thereafter issued or Incurred, unless
in the instrument creating or evidencing the same or
pursuant to which the same is outstanding it is provided
that such obligations are not superior in right of payment
to the Securities; provided, however, that Senior
Indebtedness shall not include (1) any liability for
Federal, state, local or other taxes owed or owing by the
Company, (2) any Trade Payables, (3) any Indebtedness,
Guarantee or obligation of the Company which is subordinate
or junior in any respect to any other Indebtedness,
Guarantee or obligation of the Company, including any Senior
Subordinated Indebtedness and any Subordinated Obligations,
(4) any obligations with respect to any Capital Stock,
(5) any Indebtedness Outstanding or Incurred in violation of
this Indenture or (6) any obligation of the Company to any
Affiliate of the Company.
"Senior Subordinated Indebtedness" means the
Securities and any other Indebtedness of the Company that
specifically provides that such Indebtedness is to rank pari
passu with the Securities and is not subordinated by its
terms to any Indebtedness or other obligation of the Company
which is not Senior Indebtedness.
"Significant Subsidiary" means a Subsidiary of
the Company that is a "significant subsidiary" as defined in
Rule 1-02 of Regulation S-X promulgated under the Securities
Act and the Exchange Act.
"Specified Equipment" means the mixers
(i) Xxxxx Mod. V550/550A, 30-15-50 H. P. Drivers, 250 Gal.
Vacuum Resin Mixing Tank, Screw-Hi Shear & Anchor
w/Insulated, Heated Controls, Explosion Proof, S/N 918 and
(ii) Xxxxx Mod. V550/550A, 50-25-75 H. P. Drivers, 500 Gal.
Vacuum Resin Mixing Tank, Insulated, Heated, Screw-Hi Shear
& Anchor, Valves, Computer & Controls, Explosion Proof,
S/N 921, together with all attachments and appurtenances
thereto and any related equipment to be used by the Company
to manufacture products pursuant to the Manufacturing and
Supply Agreement between the Company and Ciba-Geigy
Corporation dated as of February 29, 1996.
"Specified Properties" shall mean the Company's
manufacturing plants located in (i) Lancaster, Ohio,
(ii) Anaheim, California, (iii) Welkenraedt, Belgium and
(iv) Graham, Texas.
"Stated Maturity" means, with respect to any
security, the date specified in such security as the fixed
date on which the payment of principal of such security is
due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing
for the repurchase of such security at the option of the
holder thereof upon the happening of any contingency beyond
the control of the issuer unless such contingency has
occurred).
"Strategic Alliance Agreement" means the
Strategic Alliance Agreement dated as of September 29, 1995,
as amended as of December 12, 1995, and as further amended
by letter agreement dated as of February 28, 1996, among
Ciba, Ciba-Geigy Corporation and the Company.
"Subordinated Obligation" means any
Indebtedness of the Company (whether outstanding at the time
of Closing or thereafter Incurred) which is subordinate or
junior in right of payment to the Securities pursuant to a
written agreement.
"Subsidiary" of any Person means any
corporation, association, partnership or other business
entity of which more than 50% of the total voting power of
shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned
or controlled, directly or indirectly, by (i) such Person,
(ii) such Person and one or more Subsidiaries of such Person
or (iii) one or more Subsidiaries of such Person. Unless
the context requires otherwise, "Subsidiary" shall refer to
a Subsidiary of the Company.
"Temporary Cash Investments" means any of the
following: (i) investments in U.S. Government Obligations
maturing within 180 days of the date of acquisition thereof,
(ii) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days
of the date of acquisition thereof issued by a bank or trust
company which is organized under the laws of the United
States of America, any State thereof or any foreign country
recognized by the United States of America having capital,
surplus and undivided profits aggregating in excess of
$250,000,000 (or the Dollar Equivalent thereof) and whose
long-term debt is rated "A-" or higher according to Xxxxx'x
Investors Service, Inc. (or such equivalent rating by at
least one "nationally recognized statistical rating
organization" (as defined in Rule 436 under the Securities
Act)), (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types
described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above
and (iv) investments in commercial paper, maturing not more
than 90 days after the date of acquisition, issued by a
corporation (other than an Affiliate of the Company)
organized and in existence under the laws of the United
States of America or any foreign country recognized by the
United States of America with a rating at the time as of
which any investment therein is made of "P-1" (or higher)
according to Xxxxx'x Investors Service, Inc. or "A-1" (or
higher) according to Standard and Poor's Corporation.
"TIA" means the Trust Indenture Act of 1939
(15 U.S.C. SECTION 77aaa-77bbbb) as in effect on the date of this
Indenture.
"Trade Payables" means, with respect to any
Person, any accounts payable or any indebtedness or monetary
obligation to trade creditors created, assumed or Guaranteed
by such Person arising in the ordinary course of business of
such Person in connection with the acquisition of goods or
services.
"Trustee" means the party named as such in this
Indenture until a successor replaces it in accordance with
the provisions of this Indenture and, thereafter, means the
successor.
"Trust Officer" means the Chairman of the
Board, the President or any other officer or assistant
officer of the Trustee assigned by the Trustee to administer
its corporate trust matters.
"Uniform Commercial Code" means the New York
Uniform Commercial Code as in effect from time to time.
"U.S. Government Obligations" means direct
obligations (or certificates representing an ownership
interest in such obligations) of the United States of
America (including any agency or instrumentality thereof)
for the payment of which the full faith and credit of the
United States of America is pledged and which are not
callable or redeemable at the issuer's option.
"Voting Stock" of a corporation means all
classes of Capital Stock of such corporation then
outstanding and normally entitled to vote in the election of
directors.
"Wholly Owned Subsidiary" means a Subsidiary of
the Company all the Capital Stock of which (other than
directors' qualifying shares) is owned by the Company or
another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
DEFINED IN TERM
SECTION
"Affiliate Transaction" ................ 4.07
"Bankruptcy Law" ....................... 6.01
"Blockage Notice" ...................... 10.03
"covenant defeasance option" ........... 8.01(b)
"Custodian" ............................ 6.01
"Event of Default" ..................... 6.01
"legal defeasance option" .............. 8.01(b)
"Legal Holiday" ........................ 11.07
"Notice of Default...................... 6.01
"Offer" ................................ 4.06
"Offer Amount" ......................... 4.06
"Offer Period" ......................... 4.06
"pay the Securities" ................... 10.03
"Paying Agent" ......................... 2.03
"Payment Blockage Period" .............. 10.03
"Purchase Date" ........................ 4.06
"Refinanced Indebtedness" ............. 4.03(d)
"Registrar"............................. 2.03
"Restricted Payment" ................... 4.04
"Successor Company" .................... 5.01(b)
SECTION 1.03. Incorporation by Reference of
Trust Indenture Act. This Indenture is subject to the
mandatory provisions of the TIA which are incorporated by
reference in and made a part of this Indenture. The
following TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a
Securityholder.
"indenture to be qualified" means this
Indenture.
"indenture trustee" or "institutional trustee"
means the Trustee.
"obligor" on the indenture securities means the
Company and any other obligor on the Securities.
All other TIA terms used in this Indenture that
are defined by the TIA, defined by TIA reference to another
statute or defined by SEC rule and not otherwise defined
herein have the meanings assigned to them by such
definitions.
SECTION 1.04. Rules of Construction. Unless
the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined
has the meaning assigned to it in accordance with
GAAP;
(3) "or" is not exclusive;
(4) "including" means including without
limitation;
(5) words in the singular include the plural
and words in the plural include the singular;
(6) unsecured Indebtedness shall not be deemed
to be subordinate or junior to Secured
Indebtedness merely by virtue of its nature as
unsecured Indebtedness;
(7) the principal amount of any noninterest
bearing or other discount security at any date
shall be the principal amount thereof that would
be shown on a balance sheet of the issuer dated
such date prepared in accordance with GAAP; and
(8) the principal amount of any Preferred Stock
shall be the greater of (i) the maximum
liquidation value of such Preferred Stock or
(ii) the maximum mandatory redemption or mandatory
repurchase price with respect to such Preferred
Stock.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Form and Dating. The Securities
and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is hereby
incorporated in and expressly made a part of this Indenture.
The Securities may have notations, legends or endorsements
required by law, stock exchange rule, agreements to which
the Company is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable
to the Company). The Company shall furnish any such legend
not contained in Exhibit A to the Trustee in writing. Each
Security shall be dated the date of its authentication.
SECTION 2.02. Execution and Authentication;
Issuance. Two Officers shall sign the Securities for the
Company by manual or facsimile signature. The Company's
seal shall be impressed, affixed, imprinted or reproduced on
the Securities and may be in facsimile form.
If an Officer whose signature is on a Security
no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be valid until an
authorized signatory of the Trustee manually signs the
certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has
been authenticated under this Indenture.
The Securities shall be issued in up to three
series. At least three Business Days prior to the date upon
which the Securities in a series are to be issued (unless
the Trustee consents to a shorter period), the Company shall
deliver to the Trustee an Officers' Certificate that
(a) sets forth (i) the principal amount of the Securities in
the series to be issued, (ii) the date on which the original
issuance of Securities in such series shall be
authenticated, (iii) the date from which interest shall
accrue and (iv) the first interest payment date, whether
March 1 or September 1, and (b) provides instructions
concerning registration, amounts for each Holder and
delivery. The Trustee shall be entitled to rely upon such
Officers' Certificate without further investigation. The
Company shall not be required to deliver an Opinion of
Counsel in connection with such Officer's Certificate.
Except as set forth in the first sentence of this paragraph,
the terms of all the series of Securities shall be identical
and all Securities issued hereunder shall be deemed to
constitute a single series regardless of the date on which
such Securities are issued.
Upon receipt of the applicable Officers'
Certificate, the Trustee shall authenticate and deliver
Securities of the applicable series for original issue in
the aggregate principal amount specified therein.
The Trustee may appoint an authenticating agent
reasonably acceptable to the Company to authenticate the
Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference
in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has
the same rights as any Registrar, Paying Agent or agent for
service of notices and demands.
Securities shall be issuable only in registered
form, without coupons, in denominations of $1,000 and any
integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent. The
Company shall maintain an office or agency where Securities
may be presented for registration of transfer or for
exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register of the
Securities and of their transfer and exchange. The Company
may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes
any additional paying agent.
The Company shall enter into an appropriate
agency agreement with any Registrar, Paying Agent or co-
registrar not a party to this Indenture, which shall
implement the provisions of this Indenture that relate to
such agent. Any such agency agreement with any Paying Agent
shall incorporate the terms of the TIA which relate to the
duties of a Paying Agent. The Company shall notify the
Trustee of the name and address of any such agent. If the
Company fails to maintain a Registrar or Paying Agent, the
Trustee shall act as such and shall be entitled to
appropriate compensation therefor pursuant to Section 7.07.
The Company or any of its domestically incorporated Wholly
Owned Subsidiaries may act as Paying Agent, Registrar, co-
registrar or transfer agent.
The Company initially appoints the Trustee as
Registrar and Paying Agent in connection with the
Securities.
SECTION 2.04. Paying Agent To Hold Money in
Trust. Prior to each due date of the principal and interest
on any Security, the Company shall deposit with the Paying
Agent a sum sufficient to pay such principal and interest
when so becoming due. The Company shall require each Paying
Agent (other than the Trustee) to agree in writing that the
Paying Agent shall hold in trust for the benefit of
Securityholders or the Trustee all money held by the Paying
Agent for the payment of principal of or interest on the
Securities and shall notify the Trustee of any default by
the Company in making any such payment. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate the
money held by it as Paying Agent and hold it as a separate
trust fund. The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee and to
account for any funds disbursed by the Paying Agent, and
upon such payment the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.05. Securityholder Lists. The
Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the
names and addresses of Securityholders. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee,
in writing at least five Business Days before each interest
payment date and at such other times as the Trustee may
request in writing a list in such form and as of such date
as the Trustee may reasonably require of the names and
addresses of Securityholders, and the Company shall
otherwise comply with TIA SECTION 312(a).
SECTION 2.06. Transfer and Exchange. The
Securities shall be issued in registered form and shall be
transferable only upon the surrender of a Security for
registration of transfer. When a Security is presented to
the Registrar or a co-registrar with a request to register a
transfer, the Registrar shall register the transfer as
requested if the requirements of Section 8-401(1) of the
Uniform Commercial Code are met. When Securities are
presented to the Registrar or a co-registrar with a request
to exchange them for an equal principal amount of Securities
of other denominations, the Registrar shall make the
exchange as requested if the same requirements are met. To
permit registration of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Securities
at the Registrar's or co-registrar's request. The Company
may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with
any transfer or exchange pursuant to this Section. The
Company shall not be required to make and the Registrar
shall not be required to register transfers or exchanges of
any Security (i) during a period of 15 days before any
selection of securities to be redeemed or 15 days before an
interest payment date or (ii) selected for redemption in
whole or in part, except the unredeemed portion of any
Security being redeemed in part.
Prior to the due presentation for registration
of transfer of any Security, the Company, the Trustee, the
Paying Agent, the Registrar or any co-registrar may deem and
treat the person in whose name a Security is registered as
the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such
Security and for all other purposes whatsoever, whether or
not such Security is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-registrar
shall be affected by notice to the contrary.
All Securities issued upon any transfer or
exchange pursuant to the terms of this Indenture will
evidence the same debt and will be entitled to the same
benefits under this Indenture as the Securities surrendered
upon such transfer or exchange.
SECTION 2.07. Replacement Securities. If a
mutilated Security is surrendered to the Registrar or if the
Holder of a Security claims that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and
the Trustee shall authenticate a replacement Security if the
requirements of Section 8-405 of the Uniform Commercial Code
are met and the Holder satisfies any other reasonable
requirements of the Trustee or the Company. If required by
the Trustee or the Company, such Holder shall furnish an
indemnity bond sufficient in the judgment of the Company and
the Trustee to protect the Company, the Trustee, the Paying
Agent, the Registrar and any co-registrar from any loss
which any of them may suffer if a Security is replaced. The
Company and the Trustee may charge the Holder for their
expenses in replacing a Security.
Every replacement Security is an additional
obligation of the Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all Securities
authenticated by the Trustee except for those canceled by
it, those delivered to it for cancellation and those
described in this Section as not outstanding. A Security
does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Security.
If a Security is replaced pursuant to
Section 2.07, it ceases to be outstanding unless the Trustee
and the Company receive proof satisfactory to them that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in
trust, in accordance with this Indenture, on a redemption
date or maturity date money sufficient to pay all principal
and interest payable on that date with respect to the
Securities (or portions thereof) to be redeemed or maturing,
as the case may be, and the Paying Agent is not prohibited
from paying such money to the Securityholders on that date
pursuant to the terms of this Indenture, then on and after
that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
In determining whether the Holders of the
required principal amount of Securities have concurred in
any direction, waiver or consent or any amendment,
modification or other change to the Indenture, Securities
owned by the Company or by any Person directly or indirectly
controlling or controlled by or under direct or indirect
common control with the Company shall be disregarded and
treated as if they were not outstanding, except that for the
purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or
consent or any amendment, modification or other change to
the Indenture, only Securities which the Trustee knows are
so owned shall be so disregarded.
SECTION 2.09. Temporary Securities. Until
definitive Securities are ready for delivery, the Company
may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in
the form of definitive Securities but may have variations
that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive
Securities and deliver them in exchange for temporary
Securities.
SECTION 2.10. Cancellation. The Company at
any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Securities surrendered to them
for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel and destroy (subject to
the record retention requirements of the Exchange Act) all
Securities surrendered for registration of transfer,
exchange, payment or cancellation and deliver a certificate
of such destruction to the Company unless the Company
directs the Trustee to deliver canceled Securities to the
Company. The Company may not issue new Securities to
replace Securities it has redeemed, paid or delivered to the
Trustee for cancellation.
SECTION 2.11. Defaulted Interest. Any
interest on any Security which is payable, but is not
punctually paid or duly provided for, on the dates and in
the manner provided in the Securities and this Indenture
(herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the relevant record date by
virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each
case, as provided in clause (i) or (ii) below:
(i) The Company may elect to make payment of
any Defaulted Interest to the Persons in whose
names the Securities are registered at the close
of business on a special record date for the
payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment.
Thereupon the Trustee shall fix a special record
date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed
payment and not less than 10 days after the
receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly
notify the Company of such special record date
and, in the name and at the expense of the
Company, shall cause notice of the proposed
payment of such Defaulted Interest and the special
record date therefor to be given to each Holder,
not less than 10 days prior to such special record
date. The Company shall deposit with the Trustee
an amount of cash equal to the aggregate amount of
the proposed payment and shall make arrangements
satisfactory to the Trustee for such deposit on or
prior to the date of the proposed payment. Notice
of the proposed payment of such Defaulted Interest
and the special record date therefor having been
so mailed, such Defaulted Interest shall be paid
to the Persons in whose names the Securities are
registered at the close of business on such
special record date.
(ii) The Company may make payment of any
Defaulted Interest on the Securities in any other
lawful manner not inconsistent with the
requirements of any securities exchange on which
the Securities may be listed, and upon such notice
as may be required by such exchange, if, after
notice given by the Company to the Trustee of the
proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by
the Trustee.
Subject to the foregoing provisions of this
Section 2.11, each Security delivered under this Indenture
upon registration of transfer of or in exchange for or in
lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were
carried by such other Security.
SECTION 2.12. Record Date. The Company may
set a record date for purposes of determining the identity
of Securityholders entitled to vote or to consent to any
action by vote of consent authorized or permitted by
Sections 6.04, 6.05 and 11.06. Unless this Indenture
provides otherwise, such record date shall be the later of
30 days prior to the first solicitation of such consent or
the date of the most recent list of Holders furnished to the
Trustee pursuant to Section 2.05 prior to such solicitation.
SECTION 2.13. Agreement With Initial Holder.
As of the date of this Indenture, the Company and Ciba have
entered into an agreement, a copy of which is attached
hereto as Exhibit B (the "Retention Agreement"). The
Securities shall bear the legend referred to in the
Retention Agreement until the Trustee receives a written
notice from the Company requesting that such legend be
removed. Upon receipt of such notice, the Trustee shall
issue, or cause to be issued, replacement Securities that do
not bear such legend, as otherwise provided in this
Indenture. The Company shall not be required to provide an
Officers' Certificate or an Opinion of Counsel in connection
with such notice.
ARTICLE 3
REDEMPTION
SECTION 3.01. Notices to Trustee. If the
Company elects to redeem Securities pursuant to paragraph 5
of the Securities, it shall notify the Trustee in writing of
the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to
which the redemption will occur.
The Company shall give each notice to the
Trustee provided for in this Section at least 45 days before
the redemption date unless the Trustee consents to a shorter
period. Such notice shall be accompanied by an Officers'
Certificate from the Company to the effect that such
redemption will comply with the conditions herein. An
Opinion of Counsel shall not be required in connection with
such notice.
SECTION 3.02. Selection of Securities To Be
Redeemed. If fewer than all the Securities are to be
redeemed, the Trustee shall select the Securities to be
redeemed pro rata or by lot or by a method that complies
with applicable legal and securities exchange requirements,
if any, and that the Trustee considers fair and appropriate
and in accordance with methods generally used at the time of
selection by fiduciaries in similar circumstances. The
Trustee shall make the selection from outstanding Securities
not previously called for redemption. The Trustee may
select for redemption portions of the principal of
Securities that have denominations larger than $1,000.
Securities and portions of them the Trustee selects shall be
in amounts of $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to Securities called
for redemption also apply to portions of Securities called
for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be
redeemed.
SECTION 3.03. Notice of Redemption. At least
30 days but not more than 60 days before a date for
redemption of Securities, the Company shall mail a notice of
redemption by first-class mail to each Holder of Securities
to be redeemed.
The notice shall identify the Securities to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must
be surrendered to the Paying Agent to collect the
redemption price;
(5) if fewer than all the outstanding
Securities are to be redeemed, the identification
and principal amounts of the particular Securities
to be redeemed;
(6) that, unless the Company defaults in making
such redemption payment or the Paying Agent is
prohibited from making such payment pursuant to
the terms of this Indenture, interest on
Securities (or portion thereof) called for
redemption ceases to accrue on and after the
redemption date;
(7) the paragraph of the Securities pursuant to
which the Securities called for redemption are
being redeemed; and
(8) the CUSIP number of the Securities to be
redeemed, if any, and that no representation is
made as to the correctness or accuracy of the
CUSIP number, if any, listed in such notice or
printed on the Securities.
At the Company's request, the Trustee shall
give the notice of redemption in the Company's name and at
the Company's expense. In such event, the Company shall
provide the Trustee with the information required by this
Section.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed pursuant to
Section 3.03, Securities called for redemption become due
and payable on the redemption date and at the redemption
price stated in the notice. Upon surrender to the Paying
Agent, such Securities shall be paid at the redemption price
stated in the notice, plus accrued interest to the
redemption date (subject to the right of Holders of record
on the relevant record date to receive interest due on the
related interest payment date). Failure to give notice or
any defect in the notice to any Holder shall not affect the
validity of the notice to any other Holder.
SECTION 3.05. Deposit of Redemption Price.
Prior to the redemption date, the Company shall deposit with
the Paying Agent (or, if the Company or a Subsidiary is the
Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued
interest (subject to the right of Holders of record on the
relevant record date to receive interest due on the related
interest payment date) on all Securities to be redeemed on
that date other than Securities or portions of Securities
called for redemption which have been delivered by the
Company to the Trustee for cancellation.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the
Company shall execute and the Trustee shall authenticate for
the Holder (at the Company's expense) a new Security equal
in principal amount to the unredeemed portion of the
Security surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities. The
Company shall promptly pay the principal of and interest on
the Securities on the dates and in the manner provided in
the Securities and in this Indenture. Principal and
interest shall be considered paid on the date due if on such
date the Trustee or the Paying Agent holds in accordance
with this Indenture money sufficient to pay all principal
and interest then due and the Trustee or the Paying Agent,
as the case may be, is not prohibited from paying such money
to the Securityholders on that date pursuant to the terms of
this Indenture.
The Company shall pay interest on overdue
principal at the rate specified therefor in the Securities,
and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. If at any time
following the Closing the Company is not required to file
annual reports and other reports pursuant to Section 13 or
15(d) of the Exchange Act, the Company shall file with the
SEC and, following the Issue Date, provide the Trustee and
Securityholders with such annual reports and such
information, documents and other reports as are specified in
Sections 13 and 15(d) of the Exchange Act and applicable to
a U.S. corporation subject to such Sections, such
information, documents and other reports to be so filed and
provided at the times specified for the filing of such
information, documents and reports under such Sections. The
Company also shall comply with the other provisions of
TIA SECTION 314(a).
SECTION 4.03. Limitation on Indebtedness.
(a) Following the Closing, the Company shall not, and shall
not permit any Subsidiary to, Incur any Indebtedness;
provided, however, that the Company may Incur Indebtedness
if the Consolidated Coverage Ratio on the date of such
Incurrence exceeds 2.0 to 1.0.
(b) Notwithstanding Section 4.03(a), the
Company and its Subsidiaries may Incur the following
Indebtedness:
(i) Indebtedness under the Credit Agreement
and any other loan or other agreement in an
aggregate principal amount outstanding at any time
not to exceed (A) the sum of the outstanding
Indebtedness under the Credit Agreement and the
unused commitments thereunder at the time of the
Closing and (B) $12,500,000;
(ii) Indebtedness (other than Indebtedness
permitted to be Incurred pursuant to
Section 4.03(a) or any other clause of this
Section 4.03(b)), and any Refinancing Indebtedness
Incurred in respect thereof, in an aggregate
principal amount outstanding at any time not to
exceed $12,500,000 million (less the principal
outstanding Indebtedness incurred pursuant to
clause (i)(B) above);
(iii) Indebtedness owing to and held by the
Company or any Wholly Owned Subsidiary; provided,
however, that any subsequent issuance or transfer
of any Capital Stock which results in any such
Wholly Owned Subsidiary ceasing to be a Wholly
Owned Subsidiary or any subsequent transfer of any
such Indebtedness (except to the Company or a
Wholly Owned Subsidiary) shall be deemed, in each
case, to constitute the Incurrence of such
Indebtedness;
(iv) Indebtedness represented by the Securities
and any Indebtedness (other than the Indebtedness
described in clauses (i)-(iii) above) outstanding
at the time of the Closing;
(v) Indebtedness of a Subsidiary Incurred and
outstanding on or prior to the date on which such
Subsidiary was acquired by, or otherwise became a
Subsidiary of, the Company (other than
Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit
support utilized to consummate, the transaction or
series of related transactions pursuant to which
such Subsidiary became a Subsidiary or was
otherwise acquired by the Company); provided,
however, that at the time such Subsidiary is
acquired by the Company, the Company would have
been able to Incur $1.00 of additional
Indebtedness pursuant to Section 4.03(a) after
giving effect to the Incurrence of such
Indebtedness pursuant to this clause (v);
(vi) Refinancing Indebtedness Incurred in
respect of Indebtedness Incurred pursuant to
clause (iv) or (v) above;
(vii) Indebtedness under Hedging Obligations to
the extent permitted under the Credit Agreement;
(viii) Indebtedness in respect of Capital Leases
and purchase money Indebtedness incurred by the
Company or its Subsidiaries to finance the
acquisition of tangible assets, and Indebtedness
incurred by the Company or its Subsidiaries to
refinance such Capital Leases and purchase money
Indebtedness, in an aggregate outstanding
principal amount not to exceed $12,500,000 at any
time;
(ix) Indebtedness in an amount not to exceed
$6,000,000 in the aggregate in respect of
obligations of the Company owing to the New Jersey
Department of Environmental Protection in
existence at the time of the Closing;
(x) (A) Guarantees of any Subsidiary in respect
of obligations of the Company and (B) Guarantees
of any partnership or joint venture (other than
Existing Joint Ventures) to the extent that the
Incurrence of suchobligations shall not cause the
Maximum Partnership/Joint Venture Investment
Amount to exceed $7,000,000 at any time; provided
that no such Investment may be made as long as any
Default or Event of Default has occurred and is
continuing or would occur as a result of such
Investment;
(xi) Indebtedness under appeal bonds in
connection with judgements that do not result in a
Default or Event of Default;
(xii) Guarantees made by the Company to Dainippon
Ink & Chemical, Inc. or Hexcel-DIC Partnership in
an aggregate amount not to exceed $5,500,000;
(xiii) Guarantees relating to the Acquisition; or
(xiv) subordination of certain amounts payable to
the Company by Knytex as provided for in the
Knytex Credit Facility.
(c) Notwithstanding any other provision of
this Section 4.03, the Company shall not Incur any
Indebtedness pursuant to Section 4.03(b) if the proceeds
thereof are used, directly or indirectly, to repay, prepay,
redeem, defease, retire, refund or refinance any
Subordinated Obligations unless such Indebtedness shall be
subordinated to the Securities to at least the same extent
as such Subordinated Obligations. The Company shall not
Incur any Indebtedness pursuant to Section 4.03(a) or
4.03(b) if such Indebtedness is subordinate or junior in
ranking in any respect to any Senior Indebtedness unless
such Indebtedness is Senior Subordinated Indebtedness or is
expressly subordinated in right of payment to Senior
Subordinated Indebtedness. In addition, the Company shall
not Incur any Secured Indebtedness which is not Senior
Indebtedness unless contemporaneously therewith effective
provision is made to secure the Securities equally and
ratably with such Secured Indebtedness for so long as such
Secured Indebtedness is secured by a Lien.
(d) For purposes of determining whether the
principal amount of any Refinancing Indebtedness permitted
by this Section does not, in the event it is issued in a
currency different from the currency in which the
Indebtedness being refunded or refinanced or paid at
maturity ("Refinanced Indebtedness") was issued, exceed the
principal amount of the Refinanced Indebtedness, the spot
rate for the purchase of the currency of the Refinanced
Indebtedness with the currency of the Refinancing
Indebtedness, as published in The Wall Street Journal in the
"Exchange Rates" column under the heading "Currency Trading"
on the date two Business Days prior to such determination,
shall be used. If The Wall Street Journal does not publish
such spot rate on such date, then the spot rate for the
purchase of the currency of the Refinanced Indebtedness with
the currency of the Refinancing Indebtedness, as quoted by
Bankers Trust Company, or any successor thereto, in New York
City at approximately 11:00 a.m. (New York time) on the date
two Business Days prior to such determination, shall be
used.
Except as provided in the preceding paragraph,
for purposes of determining the Dollar Equivalent of any
Indebtedness denominated in a currency other than U.S.
dollars outstanding at any time as permitted by this
Section, such Dollar Equivalent shall be the Dollar
Equivalent of such currency at the date such Indebtedness is
issued; provided, however, that if such Indebtedness
constituted Refinancing Indebtedness, such conversion shall
be made based on the Dollar Equivalent of the Refinanced
Indebtedness at the date of the issuance of the Refinanced
Indebtedness (or any preceding Refinanced Indebtedness, as
applicable).
SECTION 4.04. Limitation on Restricted
Payments. (a) Following the Closing, the Company shall not,
and shall not permit any Subsidiary, directly or indirectly,
to (i) declare or pay any dividend or make any distribution
on or in respect of its Capital Stock (including any payment
in connection with any merger or consolidation involving the
Company) except dividends or distributions payable solely in
its Capital Stock (other than Disqualified Stock) or in
options, warrants or other rights to purchase such Capital
Stock and except dividends or distributions payable to the
Company or a Subsidiary (and, if such Subsidiary is not
wholly owned, to its other shareholders on a pro rata
basis), (ii) purchase, redeem, retire or otherwise acquire
for value any Capital Stock of the Company or any Subsidiary
held by Persons other than the Company or a Subsidiary,
(iii) purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment any
Subordinated Obligations (other than the purchase,
repurchase or other acquisition of Subordinated Obligations
purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each
case due within one year of the date of acquisition) or (iv)
make any Investment (other than a Permitted Investment) in
any Person (any such dividend, distribution, purchase,
redemption, repurchase, defeasance, other acquisition,
retirement or Investment being herein referred to as a
"Restricted Payment") if at the time the Company or such
Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be
continuing (or would result therefrom);
(2) the Company could not incur at least $1.00
of additional Indebtedness under Section 4.03(a);
or
(3) the aggregate amount of such Restricted
Payment and all other Restricted Payments (the
amount so expended, if other than in cash, to be
determined in good faith by the Board of
Directors, whose determination shall be evidenced
by a Board Resolution) declared or made since
December 31, 1995, would exceed, without
duplication, the sum of:
(a) $15,000,000 plus an amount equal to 50% of
the Consolidated Net Income accrued during the
period (treated as one accounting period) from
January 1, 1996, to the end of the most recent
fiscal quarter ending at least 45 days prior to
the date of such Restricted Payment (or, in
case such Consolidated Net Income shall be a
deficit, minus 100% of such deficit) and minus
100% of the amount of any write-downs, write-
offs, other negative revaluations and other
negative extraordinary charges not otherwise
reflected in Consolidated Net Income during
such period;
(b) the aggregate Net Cash Proceeds received by
the Company from the issue or sale of its
Capital Stock (other than Disqualified Stock)
subsequent to January 1, 1996, (other than an
issuance or sale to a Subsidiary of the Company
or an employee stock ownership plan or other
trust established by the Company or any of its
Subsidiaries); and
(c) the amount by which Indebtedness of the
Company or its Subsidiaries is reduced on the
Company's balance sheet upon the conversion or
exchange (other than by a Subsidiary),
subsequent to January 1, 1996, of any
Indebtedness of the Company or its Subsidiaries
convertible or exchangeable for Capital Stock
(other than Disqualified Stock) of the Company
(less the amount of any cash or other property
distributed by the Company or any Subsidiary
upon such conversion or exchange).
(b) The provisions of Section 4.04(a) shall
not prohibit:
(i) any purchase or redemption of Capital Stock
of the Company or Subordinated Obligations made by
exchange for, or out of the proceeds of the
substantially concurrent sale of, Capital Stock of
the Company (other than Disqualified Stock and
other than Capital Stock issued or sold to a
Subsidiary or an employee stock ownership plan or
other trust established by the Company or any of
its Subsidiaries); provided, however, that
(A) such purchase or redemption shall be excluded
in the calculation of the amount of Restricted
Payments and (B) the Net Cash Proceeds from such
sale shall be excluded from clause (3)(b) of
Section 4.04(a);
(ii) any purchase or redemption of Subordinated
Obligations made by exchange for, or out of the
proceeds of the substantially concurrent sale of,
Indebtedness of the Company which is permitted to
be Incurred pursuant to Section 4.03; provided,
however, that such Indebtedness (A) shall be
subordinated to the Securities and shall be
subordinated to Senior Indebtedness and Senior
Subordinated Indebtedness to at least the same
extent as the Subordinated Obligations so
exchanged, purchased or redeemed, (B) shall have a
Stated Maturity later than the Stated Maturity of
the Securities and (C) shall have an Average Life
greater than the remaining Average Life of the
Securities; provided, further, that such purchase
or redemption shall be excluded in the calculation
of the amount of Restricted Payments;
(iii) any purchase or redemption of Subordinated
Obligations from Net Available Cash to the extent
permitted by Section 4.06; provided, however, that
such purchase or redemption shall be excluded in
the calculation of the amount of Restricted
Payments;
(iv) dividends paid within 60 days after the
date of declaration thereof if at such date of
declaration such dividend would have complied with
Section 4.04(a); provided, however, that at the
time of payment of such dividend, no other Default
shall have occurred and be continuing (or result
therefrom); provided further, however, that such
dividend shall be included in the calculation of
the amount of Restricted Payments from and after
the date of declaration thereof;
(v) so long as no Default shall have occurred
and be continuing (or result therefrom),
Restricted Payments in an aggregate amount not to
exceed $25,000,000; provided that all such
Restricted Payments permitted under this
paragraph (v) shall be excluded from the
calculation of the amount of Restricted Payments;
(vi) any scheduled payment by the Company or any
of its Subsidiaries in respect of any Guaranty or
other Indebtedness existing at the time of the
Closing owed by the Company or any of its
Subsidiaries in respect of Dainippon Ink &
Chemicals, Inc. and Hexcel-DIC Partnership;
provided, however, that an aggregate amount of up
to $6,250,000 of such payments shall be excluded
in the calculation of the amount of Restricted
Payments;
(vii) promissory notes and other Investments
relating to the sale of the Specified Properties;
(viii) payments with respect to employee or
director stock options, stock incentive plans or
restricted stock plans of the Company;
(ix) payments of Indebtedness made in connection
with the Acquisition; or
(x) the Investment in a letter of credit or
other Investment relating to obligations of the
Company owing to the New Jersey Department of
Environmental Protection in existence at the time
of the Closing.
SECTION 4.05. Limitation on Restrictions on
Distributions from Subsidiaries. Following the Closing, the
Company shall not, and shall not permit any Subsidiary to,
create or otherwise cause or permit to exist or become
effective any encumbrance or restriction on the ability of
any Subsidiary to (i) pay dividends or make any other
distributions on or in respect of its Capital Stock or pay
any Indebtedness owed to the Company or any Subsidiary,
(ii) make any loans or advances to the Company or
(iii) transfer any of its property or assets to the Company
or any Subsidiary, except:
(1) any encumbrance or restriction pursuant to
the Credit Agreement, this Indenture and any
agreement in effect at or entered into at the time
of the Closing;
(2) any encumbrance or restriction with respect
to a Subsidiary pursuant to an agreement relating
to any Indebtedness Incurred by such Subsidiary on
or prior to the date on which such Subsidiary
became a Subsidiary of, or was acquired by, the
Company (other than Indebtedness Incurred as
consideration in, or to provide all or any portion
of the funds or credit support utilized to
consummate, the transaction or series of related
transactions pursuant to which such Subsidiary
became a Subsidiary of, or was acquired by, the
Company) and outstanding on such date;
(3) any encumbrance or restriction pursuant to
an agreement effecting a refinancing of
Indebtedness Incurred pursuant to an agreement
referred to in clause (1) or (2) of this
Section 4.05 or contained in any amendment to an
agreement referred to in clause (1) or (2) of this
Section 4.05; provided, however, that the
encumbrances and restrictions contained in any
such refinancing agreement or amendment are no
less favorable to the Securityholders than
encumbrances and restrictions contained in such
agreements;
(4) in the case of clause (iii), any
encumbrance or restriction (A) consisting of
customary non-assignment provisions in leases
governing leasehold interests to the extent such
provisions restrict the transfer of the lease or
the property leased thereunder, (B) contained in
security agreements or mortgages securing
Indebtedness of a Subsidiary to the extent such
restrictions restrict the transfer of the property
subject to such security agreements or mortgages,
(C) arising by virtue of any transfer of,
agreement to transfer, option or right with
respect to, or Lien on, any property or assets of
the Company or any Subsidiary not otherwise
prohibited by this Indenture or (D) arising or
agreed to in the ordinary course of business and
that does not, individually or in the aggregate,
detract from the value of property or assets of
the Company or any Subsidiary in any manner
material to the Company or such Subsidiary; and
(5) any restriction with respect to a
Subsidiary imposed pursuant to an agreement
entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of
such Subsidiary pending the closing of such sale
or disposition.
SECTION 4.06. Limitation on Sales of Assets
and Subsidiary Stock. (a) Following the Closing, the
Company and its Subsidiaries may make Asset Dispositions in
an aggregate amount not to exceed $10 million in any fiscal
year of the Company.
(b) Following the Closing, the Company shall
not, and shall not permit any Subsidiary to, make any Asset
Disposition which, either alone or together with all other
Asset Dispositions made by the Company and its Subsidiaries
during such fiscal year, exceeds $10 million unless (i) the
Company or such Subsidiary receives consideration at the
time of such Asset Disposition at least equal to the fair
market value, as determined in good faith by the Board of
Directors (if such fair market value is greater than
$10,000,000), the determination of which shall be evidenced
by a Board Resolution (including as to the value of all non-
cash consideration (if such fair market value is greater
than $3,000,000)), of the shares and assets subject to such
Asset Disposition, (ii) at least 75% of the consideration
thereof received by the Company or such Subsidiary is in the
form of cash and (iii) an amount equal to 100% of the Net
Available Cash from such Asset Disposition is applied by the
Company (or such Subsidiary, as the case may be) (A) first,
to the extent the Company elects (or is required by the
terms of any Senior Indebtedness), to prepay, repay or
purchase Senior Indebtedness or Indebtedness (other than any
Preferred Stock) of a Wholly Owned Subsidiary (in each case
other than Indebtedness owed to the Company or an Affiliate
of the Company) within 270 days from the later of the date
of such Asset Disposition or the receipt of such Net
Available Cash; (B) second, to the extent of the balance of
Net Available Cash after application in accordance with
clause (A), to the extent the Company or such Subsidiary
elects, to reinvest in Additional Assets (including by means
of an Investment in Additional Assets by a Subsidiary with
Net Available Cash received by the Company or another
Subsidiary) within 270 days from the later of such Asset
Disposition or the receipt of such Net Available Cash;
(C) third, to the extent of the balance of such Net
Available Cash after application in accordance with
clauses (A) and (B), to make an Offer to purchase Securities
pursuant to and subject to the conditions of Section
4.06(c), and (D) fourth, to the extent of the balance of
such Net Available Cash after application in accordance with
clauses (A), (B) and (C), for any purpose not prohibited by
the terms of this Indenture.
For the purposes of this Section, the following
shall be deemed to be cash: (x) the assumption of
Indebtedness of the Company (other than Preferred Stock of
the Company) or any Subsidiary and the release of the
Company or such Subsidiary from all liability with respect
to such Indebtedness in connection with such Asset
Disposition, provided that the amount of such Indebtedness
shall not be deemed to be cash for the purpose of the term
"Net Available Cash," and (y) securities received by the
Company or any Subsidiary from the transferee that are
promptly converted by the Company or such Subsidiary into
cash.
(c) In the event of an Asset Disposition that
requires the purchase of Securities pursuant to
Section 4.06(b)(iii)(C), the Company shall purchase
Securities tendered pursuant to an offer by the Company for
the Securities (the "Offer") at a purchase price of 100% of
their principal amount plus accrued interest to the Purchase
Date in accordance with the procedures (including
prorationing in the event of oversubscription) set forth in
Section 4.06(b). If the aggregate purchase price of
Securities tendered pursuant to the Offer is less than the
Net Available Cash allotted to the purchase of the
Securities, the Company shall apply the remaining Net
Available Cash in accordance with Section 4.06(b)(iii)(D).
The Company shall not be required to make an Offer for
Securities pursuant to this Section if the Net Available
Cash available therefor (after application of the proceeds
as provided in clauses (A) and (B) of Section 4.06(b)(iii))
is less than $5,000,000 for any particular Asset Disposition
(which lesser amounts shall be carried forward for purposes
of determining whether an Offer is required with respect to
the Net Available Cash from any subsequent Asset
Disposition).
(d) (1) Promptly, and in any event within
10 days after the Company becomes obligated to make an
Offer, the Company shall be obligated to deliver to the
Trustee and send, by first-class mail to each Holder, a
written notice stating that the Holder may elect to have his
Securities purchased by the Company either in whole or in
part (subject to prorationing as hereinafter described in
the event the Offer is oversubscribed) in integral multiples
of $1,000 of principal amount, at the applicable purchase
price. The notice shall specify a purchase date not less
than 30 days nor more than 60 days after the date of such
notice (the "Purchase Date") and shall contain information
concerning the business of the Company which the Company in
good faith believes will enable such Holders to make an
informed decision (which at a minimum will include (i) the
most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company,
the most recent subsequently filed Quarterly Report on Form
10-Q and any Current Report on Form 8-K of the Company filed
subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in
the offering materials (or corresponding successor reports),
(ii) a description of material developments in the Company's
business subsequent to the date of the latest of such
Reports, and (iii) if material, appropriate pro forma
financial information) and all instructions and materials
necessary to tender Securities pursuant to the Offer,
together with the information contained in clause (3).
(2) Not later than the date upon which written
notice of an Offer is delivered to the Trustee, the Company
shall deliver to the Trustee an Officers' Certificate as to
(i) the amount of the Offer (the "Offer Amount"), (ii) the
allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and
(iii) the compliance of such allocation with the provisions
of Section 4.06(b). Upon the expiration of the period for
which the Offer remains open (the "Offer Period"), the
Company shall deliver to the Trustee the Securities or
portions thereof which have been properly tendered to and
are to be accepted by the Company and shall irrevocably
deposit with the Trustee an amount of cash equal to the
aggregate purchase price for the Securities tendered in the
Offer, provided that such amount shall not exceed the Offer
Amount. The Trustee shall, on the Purchase Date, mail or
deliver payment to each tendering Holder in the amount of
the purchase price.
(3) Holders electing to have a Security
purchased will be required to surrender the Security, with
an appropriate form duly completed, to the Company at the
address specified in the notice at least 10 Business Days
prior to the Purchase Date. Holders will be entitled to
withdraw their election if the Trustee or the Company
receives, not later than three Business Days prior to the
Purchase Date, a telegram, facsimile transmission or letter
setting forth the name of the Holder, the principal amount
of the Security which was delivered for purchase by the
Holder and a statement that such Holder is withdrawing his
election to have such Security purchased. If, at the
expiration of the Offer Period, the aggregate principal
amount of Securities surrendered by Holders exceeds the
Offer Amount, the Company shall select the Securities to be
purchased on a pro rata basis (with such adjustments as may
be deemed appropriate by the Company so that only Securities
in denominations of $1,000, or integral multiples thereof,
shall be purchased). Holders whose Securities are purchased
only in part shall be issued new Securities equal in
principal amount to the unpurchased portion of the
Securities surrendered.
(4) On or before the Purchase Date, the
Company shall (i) accept for payment the Securities or
portions thereof that have been properly tendered pursuant
to the offer made pursuant to this Section 4.06,
(ii) deposit with the Trustee an amount of cash equal to the
aggregate amount of the aggregate purchase price for the
Securities and portions thereof properly tendered and
accepted pursuant to clause (i) and shall make arrangements
satisfactory to the Trustee for such deposit prior to the
date of the purchase date and (iii) deliver to the Trustee
the Securities or portions thereof which have been properly
tendered to and accepted by the Company. The Trustee shall,
on the Purchase Date, mail or deliver payment of the
purchase price to each tendering Holder. A Security shall
be deemed to have been accepted for purchase at the time the
Trustee, directly or through an agent, mails or delivers
payment therefor to the surrendering Holder.
(e) The Company shall comply, to the extent
applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations
in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any
securities laws or regulations conflict with provisions of
this Section, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue
thereof.
(f) Notwithstanding anything to the contrary
contained in this Section, (i) Hexcel Technologies, Inc. may
transfer up to 15% of the outstanding partnership interests
in HDP to DIC Technologies, Inc., (ii) the Company may sell
the Specified Equipment to Ciba or any Affiliate of Ciba and
(iii) the Company or any Subsidiary may grant licenses in
respect of intellectual property to Ciba or any Subsidiary
of Ciba pursuant to the Strategic Alliance Agreement.
(g) Notwithstanding anything to the contrary
contained in this Section, the Company shall be deemed to
have complied with Section 4.06(b)(iii)(A) if the Net
Available Cash from any sale or other disposition of any of
the Specified Properties are applied to repay outstanding
loans under the Credit Agreement (whether or not the
commitments thereunder are reduced in connection therewith).
SECTION 4.07. Limitation on Transactions with
Affiliates. (a) Following the Closing, the Company shall
not, and shall not permit any Subsidiary to, directly or
indirectly, conduct any business, enter into or permit to
exist any transaction or series of similar transactions
(including the purchase, conveyance, disposition, sale,
lease or exchange of any property, employee compensation
arrangements or the rendering of any service) with, or for
the benefit of, any Affiliate of the Company involving an
amount in excess of $100,000 (an "Affiliate Transaction")
unless (i) the terms of such Affiliate Transaction are
(1) set forth in writing and (2) as favorable to the Company
or such Subsidiary, as the case may be, as those that could
be obtained at the time of such Affiliate Transaction for a
similar transaction in arm's-length dealings with a Person
who is not such an Affiliate and (ii) the disinterested
members of the Board of Directors have determined in good
faith that the criteria set forth in clause (i)(2) are
satisfied and have approved the relevant Affiliate
Transaction, such determination and approval to be evidenced
by a Board Resolution if such Affiliate Transaction involves
an amount in excess of $1,000,000; provided, however, that
if such Affiliate Transaction involves an amount in excess
of $10,000,000, the Board of Directors shall have received
an opinion from an investment banking firm of national
prominence that is not an Affiliate of the Company to the
effect that such Affiliate Transaction is fair from a
financial point of view, provided, further, that the term
"Affiliate Transaction" shall not include (A) any
transaction between the Company or any of its Subsidiaries
and (i) any Permitted Holder, (ii) Hexcel Foundation so long
as such foundation remains a not-for-profit institution for
the purposes of California law, (iii) Xxxx, (iv) Hexcel-DIC
Partnership and (v) Knytex; (B) existing employment or
compensation agreements or other arrangements with officers
or directors of the Company or any Subsidiary, (C) existing
management agreements, (D) stock options and awards granted
to employees and directors of the Company or any Subsidiary
under existing employee benefit plans, (E) any contract or
transaction providing for indemnification of officers or
directors of the Company or any Subsidiary from liability,
or providing or maintaining insurance or other arrangements
on behalf of any such officer or director against any
liability asserted against such person and incurred in or
arising out of such capacity and (F) the subrogation
agreement and related agreements entered into or to be
entered into by the Company in connection with the Knytex
Credit Facility.
(b) The provisions of Section 4.07(a) shall
not prohibit (i) any Restricted Payment permitted to be paid
pursuant to Section 4.04, (ii) any issuance of securities,
or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans
approved by the Board of Directors, (iii) the payment of
reasonable fees to directors of the Company and its
Subsidiaries who are not employees of the Company or of
Subsidiaries, (iv) the grant of stock options or similar
rights to employees and directors of the Company pursuant to
plans approved by the Board of Directors and (v) an
Affiliate Transaction between the Company and a Wholly Owned
Subsidiary or between Wholly Owned Subsidiaries.
SECTION 4.08. Change of Control. (a) Upon a
Change of Control, each Holder shall have the right to
require that the Company repurchase such Holder's Securities
at a purchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to
the date of purchase (subject to the right of holders of
record on the relevant record date to receive interest due
on the related interest payment date), in accordance with
the terms contemplated in Section 4.08(b). In the event
that at the time of such Change of Control the terms of the
Bank Indebtedness restrict or prohibit the repurchase of
Securities pursuant to this Section, then prior to the
mailing of the notice to Holders provided for in
Section 4.08(b) below but in any event within 30 days
following any Change of Control, the Company covenants to
(i) repay in full all Bank Indebtedness or offer to repay in
full all Bank Indebtedness and to repay the Bank
Indebtedness of each lender who has accepted such offer or
(ii) obtain the requisite consent under the agreements
governing the Bank Indebtedness to permit the repurchase of
the Securities as provided for in Section 4.08(b).
(b) Within 30 days following any Change of
Control, the Company shall send, by first-class mail to each
Holder, a notice to each Holder with a copy to the Trustee
stating:
(1) that a Change of Control has occurred and
that such Holder has the right to require the
Company to purchase such Holder's Securities at a
purchase price in cash equal to 101% of the
principal amount thereof plus accrued and unpaid
interest, if any, to the date of purchase;
(2) the circumstances and relevant facts
regarding such Change of Control (including
information with respect to pro forma historical
income, cash flow and capitalization after giving
effect to such Change of Control);
(3) the purchase date (which shall be no
earlier than 30 days nor later than 60 days from
the date such notice is mailed); and
(4) the instructions determined by the Company,
consistent with this Section, that a Holder must
follow in order to have its Securities purchased,
together with the information contained in
Section 4.08(c) (and including any related
materials).
(c) Holders electing to have a Security
purchased will be required to surrender the Security, with
an appropriate form duly completed, to the Company at the
address specified in the notice at least five Business Days
prior to the purchase date. Holders will be entitled to
withdraw their election if the Trustee or the Company
receives not later than three Business Days prior to the
purchase date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal
amount of the Security which was delivered for purchase by
the Holder, the certificate number of such Security and a
statement that such Holder is withdrawing his election to
have such Security purchased.
(d) On or before the purchase date, the
Company shall (i) accept for payment the Securities or
portions thereof that have been properly tendered pursuant
to the offer made pursuant to this Section 4.08,
(ii) deposit with the Trustee an amount of cash equal to the
aggregate amount of the aggregate purchase price for the
Securities and portions thereof properly tendered and
accepted pursuant to clause (i) and shall make arrangements
satisfactory to the Trustee for such deposit prior to the
date of the purchase date and (iii) deliver to the Trustee
the Securities or portions thereof which have been properly
tendered to and accepted by the Company. The Trustee shall,
on the purchase date, mail or deliver payment of the
purchase price to each tendering Holder.
(e) The Company shall comply, to the extent
applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations
in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any
securities laws or regulations conflict with provisions of
this Section, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue
thereof.
(f) Notwithstanding the foregoing, so long as
(x) the Permitted Holders beneficially own, in the
aggregate, at least 33% of the Total Voting Power of Hexcel
(as defined in and determined pursuant to the Governance
Agreement), and the transaction giving rise to such Change
of Control required the approval of a majority of Ciba
Directors (as defined in the Governance Agreement) or
(y) the Permitted Holders beneficially own, in the
aggregate, at least 40% of the Total Voting Power of Hexcel
and the transaction giving rise to such Change of Control
required the approval of at least one Ciba Director, any
Holder that is a Permitted Holder shall not have the right
to require repurchase of such Holder's Securities pursuant
to Section 4.08(a) and otherwise shall not be treated as a
Holder for purposes of Sections 4.08(a)-(e).
SECTION 4.09. Compliance Certificate. The
Company shall deliver to the Trustee within 120 days after
the end of each fiscal year of the Company an Officers'
Certificate stating that in the course of the performance by
the signers of their duties as Officers of the Company they
would normally have knowledge of any Default and whether or
not the signers know of any Default that occurred during
such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or
proposes to take with respect thereto. The Company also
shall comply with TIA SECTION 314(a)(4).
SECTION 4.10. Further Instruments and Acts.
Upon request of the Trustee, the Company will execute and
deliver such further instruments and do such further acts as
may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.11. Limitations on Issuance and Sale
of Subsidiary Stock. Following the Closing, the Company
shall not permit any of its Subsidiaries to issue any shares
of Capital Stock of such Subsidiary (other than directors'
qualifying shares) to any Person other than the Company or
one or more Wholly Owned Subsidiaries of the Company.
Following the Closing, the Company shall not, and shall not
permit any of its Subsidiaries to, sell, transfer or
otherwise dispose of any shares of Capital Stock of any of
its Subsidiaries that accounts for 5% or more of
Consolidated Net Income for the period of the most recent
four consecutive fiscal quarters ended prior to the date of
determination hereunder for which financial statements have
been filed with the SEC pursuant to this Indenture to any
Person (other than to the Company or a Wholly Owned
Subsidiary of the Company) unless, at the time of such sale,
transfer or other disposition, all such shares of such
Subsidiary then owned by the Company and its Subsidiaries
are so sold, transferred or otherwise disposed of (it being
agreed that any transfer of such Capital Stock in connection
with the exercise of remedies under any pledge agreement
securing Bank Indebtedness shall not be prohibited by this
sentence).
ARTICLE 5
SUCCESSOR COMPANY
SECTION 5.01. When Company May Merge or
Transfer Assets. (a) At any time while the Permitted
Holders beneficially own (i) in the aggregate, at least 33%
of the Total Voting Power in Hexcel (as defined in the
Governance Agreement and determined in accordance with
Section 2.02(e) thereof) and (ii) any Securities, the
Company may consolidate with or merge with or into, or
convey, transfer or lease, in one transaction or a series of
transactions, all or substantially all its assets to, any
Person if the resulting, surviving or transferee Person
shall be a corporation organized and existing under the laws
of the United States, any State thereof or the District of
Columbia and, if other than the Company, shall expressly
assume, by a supplemental indenture, executed and delivered
to the Trustee, in form reasonably satisfactory to the
Trustee, all the obligations of the Company under the
Securities and this Indenture. Any consolidation, merger,
conveyance, transfer or lease that is subject to the
provisions of this Section 5.01(a) shall not be subject to
the provisions of Section 5.01(b).
(b) At any time when the Permitted Holders do
not beneficially own either (1) in the aggregate, at least
33% of the Total Voting Power in Hexcel (as defined in the
Governance Agreement and determined in accordance with
Section 2.02(e) thereof) or (2) any Securities, the Company
shall not consolidate with or merge with or into, or convey,
transfer or lease, in one transaction or a series of
transactions, all or substantially all its assets to, any
Person, unless: (i) the resulting, surviving or transferee
Person (the Company or any such resulting, surviving or
transferee Person, as the case may be, being herein called
the "Successor Company") shall be a corporation organized
and existing under the laws of the United States of America,
any State thereof or the District of Columbia and the
Successor Company (if not the Company) shall expressly
assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Company under the
Securities and this Indenture, (ii) immediately after giving
effect to such transaction on a pro forma basis (and
treating any Indebtedness which becomes an obligation of the
Successor Company or any Subsidiary as a result of such
transaction as having been Incurred by the Successor Company
or such Subsidiary at the time of such transaction), no
Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction on
a pro forma basis (and treating any Indebtedness which
becomes an obligation of the Successor Company or any
Subsidiary as a result of such transaction as having been
Incurred by the Successor Company or such Subsidiary at the
time of such transaction), the Successor Company could Incur
an additional $1.00 of Indebtedness pursuant to
Section 4.03(a); (iv) immediately after giving effect to
such transaction on a pro forma basis (and treating any
Indebtedness which becomes an obligation of the Successor
Company or any Subsidiary as a result of such transaction as
having been Incurred by the Successor Company or such
Subsidiary at the time of such transaction), the Successor
Company shall have Consolidated Net Worth in an amount which
is not less than the Consolidated Net Worth of the Company
immediately prior to such transaction and (v) the Company
shall have delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental
indenture (if any) comply with this Indenture.
Notwithstanding clause (ii) above, any Wholly
Owned Subsidiary may consolidate with, merge into or
transfer all or part of its properties and assets to the
Company.
(c) The Successor Company under this Article 5
shall be the successor to the Company and shall succeed to,
and be substituted for, and may exercise every right and
power of, the Company under this Indenture, but the
predecessor Company in the case of a conveyance, transfer or
lease shall not be released from the obligation to pay the
principal of and interest on the Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. An "Event of
Default" occurs if:
(1) the Company fails to make any payment of
interest on any Security when the same becomes due
and payable, whether or not such payment shall be
prohibited by Article 10, and such failure
continues for a period of 30 days;
(2) the Company (i) fails to make the payment
of the principal of any Security when the same
becomes due and payable at its Stated Maturity,
upon redemption, upon declaration, or otherwise,
whether or not such payment shall be prohibited by
Article 10 or (ii) fails to redeem or purchase
Securities when required pursuant to this
Indenture or the Securities, whether or not such
redemption or purchase shall be prohibited by
Article 10;
(3) the Company fails to comply with
Section 5.01;
(4) the Company fails to comply with
Section 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08
or 4.11 (other than a failure to purchase
Securities when required under Section 4.06 or
4.08) and such failure continues for 30 days after
the Notice of Default specified below;
(5) the Company fails to comply with any of its
agreements in the Securities or this Indenture
(other than those referred to in (1), (2), (3) or
(4) above) and such failure continues for 60 days
after the Notice of Default specified below;
(6) Indebtedness of the Company or any
Subsidiary is not paid within any applicable grace
period after final maturity or is accelerated by
the holders thereof, the total amount of such
Indebtedness unpaid or accelerated exceeds
$10,000,000 or its Dollar Equivalent at the time
and such default or acceleration continues for 10
days after the Notice of Default specified below;
(7) 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 any substantial part of its
property; or
(D) makes a general assignment for the benefit
of its creditors;
or takes any comparable action under any
foreign laws relating to insolvency;
(8) 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 any substantial
part of its property; or
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
or any similar relief is granted under any
foreign laws and the order or decree remains
unstayed and in effect for 60 days; or
(9) any judgment or decree for the payment of
money in excess of $10,000,000 or its Dollar
Equivalent in excess of applicable insurance
coverage at the time is entered against the
Company or any Significant Subsidiary and is not
discharged and there is a period of 60 days
following the entry of such judgment or decree
during which such judgment or decree is not
discharged, waived or the execution thereof
stayed.
Each of the foregoing will constitute an Event
of Default whatever the reason for any such Event of Default
and whether it is voluntary or involuntary or is effected by
operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any
administrative or governmental body.
The term "Bankruptcy Law" means Xxxxx 00,
Xxxxxx Xxxxxx Code, or any similar Federal or state law for
the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (4), (5) or (6) is not
an Event of Default until either (i) the Trustee or
(ii)(a) so long as the Permitted Holders beneficially own,
in the aggregate, at least 50% of the outstanding principal
amount of the Securities, Ciba or (b) in the event the
Permitted Holders beneficially own, in the aggregate, less
than 50% of the outstanding principal amount of the
Securities, the Holders of at least 25% in principal amount
of the Securities notify the Company of the Default and the
Company does not cure such Default within the time specified
after receipt of such notice. Such notice must specify the
Default, demand that it be remedied and state that such
notice is a "Notice of Default".
The Company shall deliver to the Trustee,
within 30 days after the occurrence thereof, written notice
in the form of an Officers' Certificate of any event which
with the giving of notice and the lapse of time would become
an Event of Default under clause (4), (5), (6) or (9), its
status and what action the Company is taking or proposes to
take with respect thereto.
SECTION 6.02. Acceleration. If an Event of
Default (other than an Event of Default specified in
Section 6.01(7) or (8) with respect to the Company) occurs
and is continuing, the Trustee by notice to the Company, or
Ciba or the Holders of at least 25% in principal amount of
the Securities, as applicable, by notice to the Company and
the Trustee, may declare the principal of and accrued
interest on all the Securities to be due and payable. Upon
such a declaration, such principal and interest shall be due
and payable immediately. If an Event of Default specified
in Section 6.01(7) or (8) with respect to the Company
occurs, the principal of and interest on all the Securities
shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the
Trustee or any Securityholders. The Holders of a majority
in principal amount of the Securities by notice to the
Trustee may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or
decree and if all existing Events of Default have been cured
or waived except nonpayment of principal or interest that
has become due solely because of acceleration. No such
rescission shall affect any subsequent Default or impair any
right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of
Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal of or
interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if
it does not possess any of the Securities or does not
produce any of them in the proceeding. A delay or omission
by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair
the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are
cumulative.
SECTION 6.04. Waiver of Past Defaults. The
Holders of a majority in principal amount of the Securities
by notice to the Trustee may waive an existing Default and
its consequences except (i) a Default in the payment of the
principal of or interest on a Security or (ii) a Default in
respect of a provision that under Section 9.02 cannot be
amended without the consent of each Securityholder affected.
When a Default is waived, it is deemed cured, but no such
waiver shall extend to any subsequent or other Default or
impair any right arising from such subsequent or other
Default.
SECTION 6.05. Control by Majority. The
Holders of a majority in principal amount of the Securities
may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that
(i) conflicts with law or this Indenture, (ii) or, subject
to Section 7.01, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or
(iii) would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent
with such direction. Prior to taking any action hereunder,
the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses
and expenses caused by taking or not taking such action.
SECTION 6.06. Limitation on Suits. A
Securityholder may not pursue any remedy with respect to
this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written
notice stating that an Event of Default is
continuing;
(2) the Holders of at least 25% in principal
amount of the Securities make a written request to
the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
reasonable security or indemnity against any loss,
liability or expense;
(4) the Trustee does not comply with the
request within 60 days after receipt of the
request and the offer of security or indemnity;
and
(5) the Holders of a majority in principal
amount of the Securities do not give the Trustee a
direction inconsistent with the request during
such 60-day period.
A Securityholder may not use this Indenture to
prejudice the rights of another Securityholder or to obtain
a preference or priority over another Securityholder.
SECTION 6.07. Rights of Holders To Receive
Payment. Notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of
principal of and interest on the Securities held by such
Holder, on or after the respective due dates expressed in
the Securities, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If
an Event of Default in payment of interest or principal
specified in Section 6.01(1) or (2) occurs and is
continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company for
the whole amount of principal and interest remaining unpaid
(together with interest on such unpaid interest to the
extent lawful) and the amounts provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of
Claim. The Trustee may file such proofs of claim and other
papers or documents as may be necessary or advisable in
order to have the claims of the Trustee and the
Securityholders allowed in any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceedings
relative to the Company, its creditors or its property and,
unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in
bankruptcy or other Person performing similar functions, and
any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee
and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to
the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel, and any other amounts
due the Trustee under Section 7.07.
SECTION 6.10. Priorities. If the Trustee
collects any money or property pursuant to this Article 6,
it shall pay out the money or property in the following
order:
FIRST: to the Trustee for amounts due under
Section 7.07;
SECOND: to holders of Senior Indebtedness to
the extent required by Article 10;
THIRD: to Securityholders for amounts due and
unpaid on the Securities for principal and
interest, ratably, without preference or priority
of any kind, according to the amounts due and
payable on the Securities for principal and
interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment
date for any payment to Securityholders pursuant to this
Section. At least 15 days before such record date, the
Company shall mail to each Securityholder and the Trustee a
notice that states the record date, the payment date and
amount to be paid.
SECTION 6.11. Undertaking for Costs. In any
suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action
taken or omitted by it as Trustee, a court in its discretion
may require the filing by any party litigant in the suit of
an undertaking to pay the costs of the suit, and the court
in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in
the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07 or a suit by Holders of more
than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension
Laws. The Company (to the extent it may lawfully refrain
from doing so) shall not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the
Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law,
and shall not hinder, delay or impede the execution of any
power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such
law had been enacted.
ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee. (a) If an
Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their
exercise as a prudent Person would exercise or use under the
circumstances in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event
of Default:
(1) the Trustee undertakes to perform such
duties and only such duties as are specifically
set forth in this Indenture and no implied
covenants or obligations shall be read into this
Indenture against the Trustee; and
(2) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the
opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming
to the requirements of this Indenture. However,
the Trustee shall examine the certificates and
opinions to determine whether or not they conform
to the requirements of this Indenture.
(c) The Trustee may not be relieved from
liability for its own negligent action, its own negligent
failure to act or its own wilful misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(2) the Trustee shall not be liable for any
error of judgment made in good faith by a Trust
Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with
respect to any action it takes or omits to take in
good faith in accordance with a direction received
by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in
any way relates to the Trustee is subject to paragraphs (a),
(b) and (c) of this Section.
(e) The Trustee shall not be liable for
interest on any money received by it except as the Trustee
may agree in writing with the Company.
(f) Money held in trust by the Trustee need
not be segregated from other funds except to the extent
required by law.
(g) No provision of this Indenture shall
require the Trustee to expend or risk its own funds or
otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to
believe that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to
it.
(h) Every provision of this Indenture relating
to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions
of this Section and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. (a) The
Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper
person. The Trustee need not investigate any fact or matter
stated in the document.
(b) Before the Trustee acts or refrains from
acting, it may require an Officers' Certificate or an
Opinion of Counsel. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance
on the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and
shall not be responsible for the misconduct or negligence of
any agent appointed with due care.
(d) The Trustee shall not be liable for any
action it takes or omits to take in good faith which it
believes to be authorized or within its rights or powers;
provided, however, that the Trustee's conduct does not
constitute wilful misconduct or negligence.
(e) The Trustee may consult with counsel, and
the advice or opinion of counsel with respect to legal
matters relating to this Indenture and the Securities shall
be full and complete authorization and protection from
liability in respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance
with the advice or opinion of such counsel.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may
become the owner or pledgee of Securities and may otherwise
deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent,
Registrar, co-registrar or co-paying agent may do the same
with like rights. However, the Trustee must comply with
Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The
Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this
Indenture or the Securities, it shall not be accountable for
the Company's use of the proceeds from the Securities, and
it shall not be responsible for any statement of the Company
in the Indenture or in any document issued in connection
with the sale of the Securities or in the Securities other
than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a
Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to each Securityholder
notice of the Default within 90 days after it occurs.
Except in the case of a Default in payment of principal of
or interest on any Security, the Trustee may withhold the
notice if and so long as a committee of its Trust Officers
in good faith determines that withholding the notice is in
the interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders.
As promptly as practicable after each May 15 beginning with
the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of
such May 15 that complies with TIA 313(a). The Trustee also
shall comply with TIA SECTIONSECTION 313(b) and 313(c).
A copy of each report at the time of its
mailing to Securityholders shall be filed with the SEC and
each stock exchange (if any) on which the Securities are
listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange
and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity. The
Company shall pay to the Trustee from time to time
reasonable compensation for its services. The Trustee's
compensation shall not be limited by any law on compensation
of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-
of-pocket expenses incurred or made by it, including costs
of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. The
Company shall indemnify the Trustee against any and all
loss, liability or expense (including attorneys' fees)
incurred by it in connection with the administration of this
trust and the performance of its duties hereunder. The
Trustee shall notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee to so
notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim
and the Trustee shall provide reasonable cooperation at the
Company's expense in the defense. The Trustee may have
separate counsel and the Company shall pay the fees and
expenses of such counsel; provided, that the Company will
not be required to pay such fees and expenses if it assumes
the Trustee's defense and there is no conflict of interest
between the Company and the Trustee in connection with such
defense. The Company need not pay for any settlement made
without its written consent. The Company need not reimburse
any expense or indemnify against any loss, liability or
expense incurred by the Trustee through the Trustee's own
wilful misconduct, negligence or bad faith.
To secure the Company's payment obligations in
this Section 7.07, the Trustee shall have a Lien prior to
the Securities on all money or property held or collected by
the Trustee other than money or property held in trust to
pay principal of and interest on particular Securities.
The Company's payment obligations pursuant to
this Section 7.07 shall survive the discharge of this
Indenture. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(7) or (8)
with respect to the Company, the expenses are intended to
constitute expenses of administration under Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The
Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the
Trustee in writing and may appoint a successor Trustee with
the Company's consent (which shall not be unreasonably
withheld). The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section
7.10;
(2) the Trustee is adjudged bankrupt or
insolvent or an order for relief is entered with
respect to the Trustee under any Bankruptcy Law;
(3) a receiver or other public officer takes
charge of the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a
vacancy exists in the office of Trustee for any reason (the
Trustee in such event being referred to herein as the
retiring Trustee), the Company shall promptly appoint a
successor Trustee.
A successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to
the Company. Thereupon the resignation or removal of the
retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall
mail a notice of its succession to Securityholders. The
retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the
lien provided for in Section 7.07.
If a successor Trustee does not take office
within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee or the Holders of at least 10%
in aggregate in principal amount of the Securities may
petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section
7.10, any Securityholder may petition any court of competent
jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations
under Section 7.07 shall continue for the benefit of the
retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If
the Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust
business or assets to, another corporation or banking
association, the resulting, surviving or transferee
corporation or banking association without any further act
shall be the successor Trustee.
In case at the time such successor or
successors by merger, conversion or consolidation to the
Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the
Trustee may adopt the certificate of authentication of any
predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the
Securities shall not have been authenticated, any successor
to the Trustee may authenticate such Securities either in
the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the
certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification.
The Trustee shall at all times satisfy the requirements of
TIA SECTION 310(a). The Trustee shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee
shall comply with TIA SECTION 310(b); provided, however, that
there shall be excluded from the operation of
TIA SECTION 310(b)(1) any indenture or indentures under which
other securities or certificates of interest or
participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth
in TIA SECTION 310(b)(1) are met.
SECTION 7.11. Preferential Collection of
Claims Against Company. The Trustee shall comply with TIA
SECTION 311(a), excluding any creditor relationship listed in TIA
SECTION 311(b). A Trustee who has resigned or been removed shall
be subject to TIA SECTION 311(a) to the extent indicated.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Liability on
Securities; Defeasance. (a) When (i) the Company delivers
to the Trustee all outstanding Securities (other than
Securities replaced pursuant to Section 2.07) for
cancellation or (ii) all outstanding Securities have become
due and payable, whether at maturity or as a result of the
mailing of a notice of redemption pursuant to Article 3
hereof, and the Company irrevocably deposits with the
Trustee funds sufficient to pay at maturity or upon
redemption all outstanding Securities, including interest
thereon (other than Securities replaced pursuant to Section
2.07), and if in either case the Company pays all other sums
payable hereunder by the Company, then this Indenture shall,
subject to Sections 8.01(c) and 8.06, cease to be of further
effect. The Trustee shall acknowledge satisfaction and
discharge of this Indenture on demand of the Company
accompanied by an Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company.
(b) Subject to Sections 8.01(c), 8.02 and
8.06, the Company at any time may terminate (i) all its
obligations under the Securities and this Indenture ("legal
defeasance option") or (ii) its obligations under
Sections 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11 and
5.01(iii) and (iv) and the operation of Section 6.01(6),
Sections 6.01(7) and 6.01(8) (to the extent applicable to
Subsidiaries) and Section 6.09 ("covenant defeasance
option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant
defeasance option.
If the Company exercises its legal defeasance
option, payment of the Securities may not be accelerated
because of an Event of Default. If the Company exercises
its covenant defeasance option, payment of the Securities
may not be accelerated because of an Event of Default
specified in Section 6.01(3) (to the extent specified in the
preceding paragraph), Section 6.01(4) (to the extent
specified in the preceding paragraph), Section 6.01(6) (to
the extent specified in the preceding paragraph),
Section 6.01(6), Sections 6.01(7) and 6.01(8) (to the extent
applicable to Subsidiaries) or Section 6.01(9) or because of
the failure of the Company to comply with Sections 5.01(iii)
and 5.01(iv).
Upon satisfaction of the conditions set forth
herein and upon request of the Company, the Trustee shall
acknowledge in writing the discharge of those obligations
that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above,
the Company's obligations in Sections 2.03, 2.04, 2.05,
2.06, 2.07, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive
until the Securities have been paid in full. Thereafter,
the Company's obligations in Sections 7.07, 8.04 and 8.05
shall survive.
SECTION 8.02. Conditions to Defeasance. The
Company may exercise its legal defeasance option or its
covenant defeasance option only if:
(1) the Company irrevocably deposits in trust
with the Trustee money or U.S. Government
Obligations for the payment of principal and
interest on the Securities to maturity or
redemption, as the case may be;
(2) the Company delivers to the Trustee a
certificate from a nationally recognized firm of
independent accountants expressing their opinion
that the payments of principal and interest when
due and without reinvestment on the deposited U.S.
Government Obligations plus any deposited money
without investment will provide cash at such times
and in such amounts as will be sufficient to pay
principal and interest when due on all the
Securities to maturity or redemption, as the case
may be;
(3) 123 days pass after the deposit is made and
during the 123-day period no Default specified in
Section 6.01(7) or (8) with respect to the Company
occurs which is continuing at the end of the
period;
(4) the deposit does not constitute a default
under any other agreement binding on the Company
and is not prohibited by Article 10;
(5) 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;
(6) in the case of the legal defeasance option,
the Company shall have delivered to the Trustee an
Opinion of Counsel stating that (i) the Company
has received from the Internal Revenue Service a
ruling, or (ii) since the date of this Indenture
there has been a change in the applicable Federal
income tax law, in either case to the effect that,
and based thereon such Opinion of Counsel shall
confirm that, the Securityholders will not
recognize income, gain or loss for Federal income
tax purposes as a result of such defeasance and
will be subject to Federal income tax on the same
amounts, in the same manner and at the same times
as would have been the case if such defeasance had
not occurred;
(7) in the case of the covenant defeasance
option, the Company shall have delivered to the
Trustee an Opinion of Counsel to the effect that
the Securityholders will not recognize income,
gain or loss for Federal income tax purposes as a
result of such covenant defeasance and will be
subject to Federal income tax on the same amounts,
in the same manner and at the same times as would
have been the case if such covenant defeasance had
not occurred; and
(8) the Company delivers to the Trustee an
Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent to the
defeasance and discharge of the Securities as
contemplated by this Article 8 have been complied
with.
Before or after a deposit, the Company may make
arrangements satisfactory to the Trustee for the redemption
of Securities at a future date in accordance with Article 3.
SECTION 8.03. Application of Trust Money. The
Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to this Article 8.
It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal
of and interest on the Securities. Money and securities so
held in trust are not subject to Article 10.
SECTION 8.04. Repayment to Company. The
Trustee and the Paying Agent shall promptly turn over to the
Company upon request any excess money or securities held by
them at any time.
Subject to any applicable abandoned property
law, the Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment
of principal or interest that remains unclaimed for two
years after such principal or interest has become due and
payable, and, thereafter, Securityholders entitled to the
money must look to the Company for payment as general
creditors.
SECTION 8.05. Indemnity for Government
Obligations. The Company shall pay and shall indemnify the
Trustee against any tax, fee or other charge imposed on or
assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government
Obligations other than any such tax, fee or other charge
that by law is for the account of the Holders.
SECTION 8.06. Reinstatement. If the Trustee
or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 8 by
reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such
time as the Trustee or Paying Agent is permitted to apply
all such money or U.S. Government Obligations in accordance
with this Article 8; provided, however, that if the Company
makes any payment of principal of or interest on any
Security because of the reinstatement of its obligations,
the Company shall be subrogated to the rights of such
Securityholders to receive such payment from the money or
U.S. Government Obligations held by the Trustee or Paying
Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders. The
Company and the Trustee may amend this Indenture or the
Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in
addition to or in place of certificated
Securities; provided, however, that the
uncertificated Securities are issued in registered
form for purposes of Section 163(f) of the Code or
in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B)
of the Code;
(4) to make any change in Article 10 that would
limit or terminate the benefits available to any
holder of Senior Indebtedness (or Representatives
therefor) under Article 10;
(5) to add guarantees with respect to the
Securities or to secure the Securities;
(6) to add to the covenants of the Company for
the benefit of the Holders or to surrender any
right or power herein conferred upon the Company;
(7) to comply with the TIA; or
(8) to make any change that does not adversely
affect the rights of any Securityholder.
An amendment under this Section may not make any
change that adversely affects the rights under Article 10 of
any holder of Senior Indebtedness then outstanding unless
the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent
to such change.
After an amendment under this Section 9.01
becomes effective, the Company shall mail to Securityholders
a notice briefly describing such amendment. The failure to
give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an
amendment under this Section.
SECTION 9.02. With Consent of Holders. The
Company and the Trustee may amend this Indenture or the
Securities or waive any provision thereof without notice to
any Securityholder but with the written consent of the
Holders of at least a majority in principal amount of the
Securities. However, without the consent of each
Securityholder affected, an amendment or waiver may not:
(1) reduce the amount of Securities whose
Holders must consent to an amendment or waiver;
(2) reduce the rate of or extend the time for
payment of interest on any Security;
(3) reduce the principal of or extend the
Stated Maturity of any Security;
(4) change the time at which any Security may
or shall be redeemed in accordance with Article 3;
(5) make any Security payable in money other
than that stated in the Security;
(6) make any change in Article 10 that
adversely affects the rights of any Securityholder
under Article 10; or
(7) make any change in Section 6.04 or 6.07 or
the second sentence of this Section.
It shall not be necessary for the consent of
the Holders under this Section to approve the particular
form of any proposed amendment, but it shall be sufficient
if such consent approves the substance thereof.
An amendment or waiver under this Section may
not make any change that adversely affects the rights under
Article 10 of any holder of Senior Indebtedness then
outstanding unless the holders of such Senior Indebtedness
(or any group or representative thereof authorized to give a
consent) consent to such change.
After an amendment or waiver under this
Section 9.02 becomes effective, the Company shall mail to
Securityholders a notice briefly describing such amendment.
The failure to give such notice to all Securityholders, or
any defect therein, shall not impair or affect the validity
of such amendment or waiver.
SECTION 9.03. Compliance with Trust Indenture
Act. Every amendment to this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of
Consents and Waivers. A consent to an amendment or a waiver
by a Holder of a Security shall bind the Holder and every
subsequent Holder of that Security or portion of the
Security that evidences the same debt as the consenting
Holder's Security, even if notation of the consent or waiver
is not made on the Security. However, any such Holder or
subsequent Holder may revoke the consent or waiver as to
such Holder's Security or portion of the Security by written
notice of revocation to the Company or the Person designated
by the Company as the person to whom consents should be sent
if such revocation is received by the Company or such Person
before the date on which the Trustee receives an Officers'
Certificate certifying that the Holders of the requisite
principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment or
waiver. After an amendment or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change
described in any of clauses (1) through (7) of Section 9.02,
in which case the amendment, supplemental indenture or
waiver shall bind only each Holder of a Security who has
consented to it and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the
consenting Holder's Security.
The Company may, but shall not be obligated to,
fix a record date for the purpose of determining the
Securityholders entitled to give their consent or take any
other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is
fixed, then notwithstanding the immediately preceding
paragraph, those Persons who were Securityholders at such
record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to
revoke any consent previously given or to take any such
action, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
SECTION 9.05. Notation on or Exchange of
Securities. If an amendment changes the terms of a
Security, the Trustee may require the Holder of the Security
to deliver it to the Trustee. The Trustee may place an
appropriate notation on the Security regarding the changed
terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in
exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or to issue a new
Security shall not affect the validity of such amendment.
SECTION 9.06. Trustee To Sign Amendments. The
Trustee shall sign any amendment 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 the Trustee shall be entitled to
receive, and (subject to Section 7.01) shall be fully
protected in relying upon, an Officers' Certificate and an
Opinion of Counsel stating that such amendment is authorized
or permitted by this Indenture.
SECTION 9.07. Payment for Consent. Neither
the Company nor any Affiliate of the Company shall, directly
or indirectly, pay or cause to be paid any consideration,
whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of this Indenture or the
Securities unless such consideration is offered to be paid
to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating
to such consent, waiver or agreement.
ARTICLE 10
SUBORDINATION
SECTION 10.01. Agreement To Subordinate. Each
Securityholder by accepting a Security agrees, that the
Indebtedness evidenced by the Securities, including, without
limitation, principal and interest on, and all other amounts
owing in respect of, such Securities is subordinated in
right of payment, to the extent and in the manner provided
in this Article 10, to the prior payment in full of all
Senior Indebtedness and that the subordination is for the
benefit of and enforceable by the holders of Senior
Indebtedness. The Securities shall in all respects rank
pari passu with all other Senior Subordinated Indebtedness
of the Company and only Indebtedness of the Company which is
Senior Indebtedness shall rank senior to the Securities in
accordance with the provisions set forth herein. All
provisions of this Article 10 shall be subject to
Section 10.12.
SECTION 10.02. Liquidation, Dissolution,
Bankruptcy. Upon any payment or distribution of the assets
of the Company to creditors upon any state, federal or
foreign proceeding for the total or partial liquidation or a
total or partial dissolution or winding up of the Company or
in a state, federal or foreign bankruptcy, reorganization,
insolvency, receivership, assignment for the benefit of
creditors or marshalling of assets or similar proceeding
relating to the Company or its property:
(1) subject to Section 10.02(2), holders of
Senior Indebtedness shall be entitled to receive
payment in full of the Senior Indebtedness
(including interest (if any) accruing at the
specified contract rate (including, without
limitation, any rate applicable upon default) on
or after the commencement of a proceeding in
bankruptcy, whether or not allowed as a claim
against the Company in a bankruptcy proceeding) in
cash, Cash Equivalents or on terms otherwise
acceptable to the holders of Senior Indebtedness
before Securityholders shall be entitled to
receive any cash payment of principal of or
interest on, or other amounts owing in respect of,
the Securities; and
(2) until the Senior Indebtedness is paid in
full, any distribution to which Securityholders
would be entitled but for this Article 10 shall be
made to holders of Senior Indebtedness as their
interests may appear, except that Securityholders
may receive shares of stock and any debt
securities that are subordinated to Senior
Indebtedness or any security distributed in any
such proceeding on account of any Senior
Indebtedness to at least the same extent as the
Securities are subordinated to the Senior
Indebtedness and do not provide for the payment of
principal prior to the Stated Maturity of all
Senior Indebtedness.
SECTION 10.03. Default on Senior Indebtedness.
The Company shall not pay the principal of or interest on,
or other amounts owing in respect of, the Securities or make
any deposit pursuant to Section 8.01 and shall not
repurchase, redeem or otherwise retire any Securities
(collectively, "pay the Securities") if (i) any Senior
Indebtedness is not paid when due (including at maturity) or
(ii) any other default on Senior Indebtedness occurs and the
maturity of such Senior Indebtedness is accelerated in
accordance with its terms unless, in either case, (x) the
default has been cured or waived and any such acceleration
has been rescinded or (y) such Senior Indebtedness has been
paid in full; provided, however, that the Company may pay
the Securities without regard to the foregoing if the
Company and the Trustee receive written notice approving
such payment from the Representatives of each issue of
Designated Senior Indebtedness. During the continuance of
any default (other than a default described in clause (i) or
(ii) of the preceding sentence) with respect to any Senior
Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such
notice as may be required to effect such acceleration) or
the expiration of any applicable grace periods, the Company
may not pay the Securities for a period (a "Payment Blockage
Period") commencing upon the receipt by the Company and the
Trustee of written notice of such default from the
Representative of any Designated Senior Indebtedness
specifying an election to effect a Payment Blockage Period
(a "Blockage Notice") and ending 179 days thereafter (or
earlier if such Payment Blockage Period is terminated (i) by
written notice to the Trustee and the Company from the
Person or Persons who gave such Blockage Notice, (ii) by
repayment in full of such Senior Indebtedness or
(iii) because the default giving rise to such Blockage
Notice is no longer continuing). Notwithstanding the
provisions described in the immediately preceding sentence
(but subject to the provisions contained in the first
sentence of this Section), unless the holders of such Senior
Indebtedness or the Representative of such holders shall
have accelerated the maturity of such Senior Indebtedness,
the Company may resume payments on the Securities after such
Payment Blockage Period. Not more than one Blockage Notice
may be given in any consecutive 360-day period, irrespective
of the number of defaults with respect to any number of
issues of Senior Indebtedness during such period; provided,
however, that if any Blockage Notice within such 360-day
period is given by or on behalf of any holders of Designated
Senior Indebtedness (other than the Bank Indebtedness), the
Representative of the Bank Indebtedness may give another
Blockage Notice within such period; provided further,
however, that in no event may the total number of days
during which any Payment Blockage Period or Periods is in
effect exceed 179 days in the aggregate during any
360 consecutive day period. For purposes of this
Section 10.03, no default or event of default which existed
or was continuing on the date of the commencement of any
Payment Blockage Period with respect to the Senior
Indebtedness initiating such Payment Blockage Period shall
be, or be made, the basis of the commencement of a
subsequent Payment Blockage Period by the Representative of
such Senior Indebtedness, whether or not within a period of
360 consecutive days, unless such default or event of
default shall have been cured or waived for a period of not
less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of
Securities. If payment of the Securities is accelerated
because of an Event of Default, the Company or the Trustee
at the direction of the Company shall promptly notify the
holders of the Designated Senior Indebtedness (or their
Representatives) of the acceleration. If any Designated
Senior Indebtedness is outstanding, the Company may not pay
the Securities until five Business Days after such holders
or the representatives of the Designated Senior Indebtedness
receive notice of such acceleration and, thereafter, may pay
the Securities only if this Article 10 otherwise permits
payment at that time.
SECTION 10.05. When Distribution Must Be Paid
Over. If a distribution is made to the Trustee or any
Securityholder that, because of this Article 10, should not
have been made to them, the Person who receives such a
distribution shall hold it in trust for holders of Senior
Indebtedness and promptly pay it over to them ratably
according to the respective amounts of such Senior
Indebtedness held or represented by them; provided that the
Trustee shall not be under any duty to hold such
distribution in trust unless it has received notice that the
terms of Article X forbid such distribution.
SECTION 10.06. Subrogation. After all Senior
Indebtedness is paid in full and until the Securities are
paid in full, Securityholders shall be subrogated to the
rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness. A
distribution made under this Article 10 to holders of Senior
Indebtedness which otherwise would have been made to
Securityholders is not, as between the Company and
Securityholders, a payment by the Company on Senior
Indebtedness.
SECTION 10.07. Relative Rights. This Article
10 defines the relative rights of Securityholders and
holders of Senior Indebtedness. Nothing in this Indenture
shall:
(1) impair, as between the Company and the
Securityholders, the obligation of the Company,
which is absolute and unconditional, to pay
principal of and interest on the Securities in
accordance with their terms; or
(2) prevent the Trustee or any Securityholder
from exercising its available remedies upon a
Default, subject to the rights of holders of
Senior Indebtedness to receive distributions
otherwise payable to Securityholders.
SECTION 10.08. Subordination May Not Be
Impaired by Company. The right of any holder of Senior
Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Securities shall not be
impaired by any act or failure to act by the Company or by
its failure to comply with this Indenture.
SECTION 10.09. Rights of Trustee and Paying
Agent. Notwithstanding Section 10.03, the Trustee or Paying
Agent may continue to make payments on the Securities and
shall not be charged with knowledge of the existence of
facts that would prohibit the making of any such payments
unless, not less than two Business Days prior to the date of
such payment, a Trust Officer of the Trustee receives notice
satisfactory to it that payments may not be made under this
Article 10. The Company, the Registrar or co-registrar, the
Paying Agent, a Representative or a holder of Senior
Indebtedness may give the notice; provided, however, that,
if an issue of Senior Indebtedness has a Representative,
only the Representative may give the notice.
The Trustee in its individual or any other
capacity may hold Senior Indebtedness with the same rights
it would have if it were not Trustee. The Registrar and co-
registrar and the Paying Agent may do the same with like
rights. The Trustee shall be entitled to all the rights set
forth in this Article 10 with respect to any Senior
Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness; and
nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 10 shall
apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to
Representative. Whenever a distribution is to be made or a
notice given to holders of Senior Indebtedness, the
distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent
Events of Default or Limit Right To Accelerate. The failure
to make a payment pursuant to the Securities by reason of
any provision in this Article 10 shall not be construed as
preventing the occurrence of a Default. Nothing in this
Article 10 shall have any effect on the right of the
Securityholders or the Trustee to accelerate the maturity of
the Securities.
SECTION 10.12. Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary,
payments from money or the proceeds of U.S. Government
Obligations held in trust under Article 8 by the Trustee for
the payment of principal of and interest on the Securities
shall not be subordinated to the prior payment of any Senior
Indebtedness or subject to the restrictions set forth in
this Article 10, and none of the Securityholders shall be
obligated to pay over any such amount to the Company or any
holder of Senior Indebtedness of the Company or any other
creditor of the Company.
SECTION 10.13. Trustee Entitled To Rely. Upon
any payment or distribution pursuant to this Article 10, the
Trustee and the Securityholders shall be entitled to rely
(i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred
to in Section 10.02 are pending, (ii) upon a certificate of
the liquidating trustee or agent or other Person making such
payment or distribution to the Trustee or to the
Securityholders or (iii) upon the Representatives for the
holders of Senior Indebtedness for the purpose of
ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior
Indebtedness and other Indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent
thereto or to this Article 10. In the event that the
Trustee determines, in good faith, that evidence is required
with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or
distribution pursuant to this Article 10, the Trustee may
request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such
Person under this Article 10, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections
7.01 and 7.02 shall be applicable to all actions or
omissions of actions by the Trustee pursuant to this Article
10.
SECTION 10.14. Trustee To Effectuate
Subordination. Each Securityholder by accepting a Security
authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the
Securityholders and the holders of Senior Indebtedness as
provided in this Article 10 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for
Holders of Senior Indebtedness. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and shall not be liable to any such holders if
it shall mistakenly pay over or distribute to
Securityholders or the Company or any other Person, money or
assets to which any holders of Senior Indebtedness shall be
entitled by virtue of this Article 10 or otherwise.
SECTION 10.16. Reliance by Holders of Senior
Indebtedness on Subordination Provisions. Each
Securityholder by accepting a Security acknowledges and
agrees that the foregoing subordination provisions are, and
are intended to be, an inducement and a consideration to
each holder of any Senior Indebtedness, whether such Senior
Indebtedness was created or acquired before or after the
issuance of the Securities, to acquire and continue to hold,
or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively
to have relied on such subordination provisions in acquiring
and continuing to hold, or in continuing to hold, such
Senior Indebtedness.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be
included in this Indenture by the TIA, the required
provision shall control.
SECTION 11.02. Notices. Any notice or
communication to the Company or the Trustee required or
permitted hereunder shall be in writing and shall be
sufficiently given if made by hand delivery, by facsimile
transmission, by overnight express service or by registered
or certified mail, postage prepaid, return receipt
requested, addressed as follows:
if to the Company:
Hexcel Corporation
0000 Xxxx Xxx Xxxxxxx Xxxxxxxxx
Xxxxxxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
if to the Trustee:
First Trust of California
Xxx Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
Attention: Xx. Xxxxx X. Xxxxx
The Company or the Trustee by notice to the
other may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication mailed to a
Securityholder shall be mailed to the Securityholder at the
Securityholder's address as it appears on the registration
books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its
sufficiency with respect to other Securityholders. If a
notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee
receives it.
SECTION 11.03. Communication by Holders with
Other Holders. Securityholders may communicate pursuant to
TIA SECTION 312(b) with other Securityholders with respect to
their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall
have the protection of TIA SECTION 312(c).
SECTION 11.04. Certificate and Opinion as to
Conditions Precedent. Upon any request or application by
the Company to the Trustee to take or refrain from taking
any action under this Indenture, the Company shall furnish
to the Trustee:
(1) an Officers' Certificate in form and
substance reasonably satisfactory to the Trustee
stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this
Indenture relating to the proposed action have
been complied with; and
(2) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee stating
that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 11.05. Statements Required in
Certificate or Opinion. Each certificate or opinion with
respect to compliance with a covenant or condition provided
for in this Indenture shall include:
(1) a statement that the individual 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
individual, he has made such examination or
investigation as is necessary to enable him to
express an informed opinion as to whether or not
such covenant or condition has been complied with;
and
(4) a statement as to whether or not, in the
opinion of such individual, such covenant or
condition has been complied with, provided that,
with respect to matters of fact, an Opinion of
Counsel may rely on an Officers' Certificate or
certificates of public officials.
SECTION 11.06. Rules by Trustee, Paying Agent
and Registrar. The Trustee may make reasonable rules for
action by or a meeting of Securityholders. The Registrar
and the Paying Agent may make reasonable rules for their
functions.
SECTION 11.07. Legal Holidays. A "Legal
Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New
York. If a payment date is a Legal Holiday, payment shall
be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening
period. If a regular record date is a Legal Holiday, the
record date shall not be affected.
SECTION 11.08. GOVERNING LAW. THIS INDENTURE
AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 11.09. No Recourse Against Others.
Any director, officer, employee, stockholder or Affiliate,
as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or this
Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting
a Security, each Securityholder waives and releases all such
liability. Such waiver and release are part of the
consideration for the issue of the Securities.
SECTION 11.10. Successors. All agreements of
the Company in this Indenture and the Securities shall bind
its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.11. Multiple Originals. The
parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is
enough to prove this Indenture.
SECTION 11.12. Table of Contents; Headings.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been
inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or
restrict any of the terms or provisions hereof.
SECTION 11.13. Severability. In case any
provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties have caused
this Indenture to be duly executed as of the date first
written above.
HEXCEL CORPORATION,
by /s/ XXXXXXX X. XXXXXX
Name: Xxxxxxx X. Xxxxxx
Title: Vice President, Chief Financial Officer and Treasurer
FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION,
by /s/ XXXXX XXXXX
Name: Xxxxx Xxxxx
Title: Assistant Vice President
EXHIBIT A
[FORM OF FACE OF SECURITY]
Increasing Rate Senior Subordinated Notes Due 2003
No. Series [ ] $
Hexcel Corporation, a Delaware corporation,
promises to pay to , or registered
assigns, the principal sum of Dollars
on .
Interest Payment Dates: March 1 and September 1.
Record Dates: February 15 and August 15.
Additional provisions of this Security are set
forth on the other side of this Security, which will, for
all purposes, have the same effect as it set forth at this
place.
Dated:
HEXCEL CORPORATION,
by_______________________
President
_______________________
Secretary
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
FIRST TRUST OF CALIFORNIA,
NATIONAL ASSOCIATION
,
as Trustee, certifies
[Seal] that this is one of
the Securities referred
to in the Indenture.
by
_____________________________
Authorized Signatory
[FORM OF REVERSE SIDE OF SECURITY]
Increasing Rate Senior Subordinated Notes Due 2003
Series [ ]
1. Interest
Hexcel Corporation, a Delaware corporation (such
corporation, and its successors and assigns under the
Indenture hereinafter referred to, being herein called the
"Company"), promises to pay interest on the principal amount
of this Security at the rate of 7.5% per annum from
[ ], 199[ ]. On the first anniversary of the date
of the Closing (as defined in the Strategic Alliance
Agreement dated as of September 29, 1995, among Ciba-Geigy
Limited, Ciba-Geigy Corporation and the Company), the rate
of interest then borne by the Securities shall increase to
9.5%, and on each subsequent anniversary of the Closing the
rate of interest then borne by the Securities shall increase
by an additional 0.5%. The Company will pay interest
semiannually on March 1 and September 1 of each year,
beginning [March 1] [September 1], 199[ ]; provided, that
interest accrued following the Closing Date shall be paid on
the first interest payment date following the date that
Securities are first issued pursuant to the Indenture.
Interest on the Securities will accrue from the most recent
date to which interest has been paid or, if no interest has
been paid, from [ ]. Interest will be
computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay interest on overdue principal
at the rate borne by the Securities, and it shall pay
interest on overdue installments of interest (including, if
applicable, installments in respect of Securities not yet
issued) at the same rate to the extent lawful. Except in
respect of the date from which interest on the Securities
accrues, the Securities of all series shall be deemed to
constitute one series for all purposes under the Indenture.
2. Method of Payment
The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are
registered holders of Securities at the close of business on
the record date immediately preceding the interest payment
date even if Securities are canceled after the record date
and on or before the interest payment date. Holders must
surrender Securities to a Paying Agent to collect principal
payments. The Company will pay principal and interest in
money of the United States of America that at the time of
payment is legal tender for payment of public and private
debts. However, the Company may pay principal and interest
by check payable in such money. The Company may mail an
interest check to a Holder at such Holder's registered
address.
3. Paying Agent and Registrar
Initially, a
corporation ("Trustee"), will act as Paying Agent and
Registrar. The Company may appoint and change any Paying
Agent, Registrar or co-registrar without notice to the
Holders. The Company or any of its domestically
incorporated Wholly Owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an
Indenture dated as of , 1996 ("Indenture"),
between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those
made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. SECTIONSECTION 77aaa-77bbbb) as in
effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. The Securities
are subject to all such terms, and Securityholders are
referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured obligations
of the Company. The Indenture imposes certain limitations
on the Company and the Subsidiaries, including the
Incurrence of Indebtedness, the payment of dividends on and
retirements of the Capital Stock of the Company and the
Subsidiaries and Subordinated Obligations, the making of
Investments, the sale of assets and transactions with
Affiliates. In addition, the Indenture limits the ability
of the Company and its Subsidiaries to restrict
distributions and dividends from Subsidiaries.
5. Optional Redemption
The Company may redeem the Securities in whole at
any time or in part from time to time at a redemption price
equal to 100% of the principal amount of the Securities to
be redeemed, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest
payment date).
The Company is not required to make mandatory
redemption or sinking fund payments.
6. Notice of Redemption
Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to
each Holder of Securities to be redeemed at his registered
address. Securities in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000.
If money sufficient to pay the redemption price of and
accrued interest on all Securities (or portions thereof) to
be redeemed on the redemption date is deposited with the
Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date
interest ceases to accrue on such Securities (or such
portions thereof) called for redemption, and the only right
of the holders of such Securities (or such portions thereof)
will be to receive payment of the redemption price and any
accrued and unpaid interest to the date fixed for
redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities
(other than, in certain circumstances, Ciba-Geigy Limited
and its affiliates) will have the right, subject to certain
conditions, to cause the Company to repurchase all or any
part of the Securities of such Holder at a repurchase price
equal to 101% of the principal amount of the Securities to
be repurchased plus accrued interest to the date of
repurchase (subject to the right of holders of record on the
relevant record date to receive interest due on the related
interest payment date) as provided in, and subject to the
terms of, the Indenture.
8. Subordination
The Securities are subordinated to Senior
Indebtedness, as defined in the Indenture. To the extent
provided in the Indenture, Senior Indebtedness must be paid
in full in cash, Cash Equivalents or on terms otherwise
acceptable to the holders of Senior Indebtedness before the
Securities may be paid. Each Securityholder by accepting a
Security agrees to the subordination provisions contained in
the Indenture and authorizes the Trustee to give it effect
and appoints the Trustee as attorney-in-fact for such
purpose. The Indenture also provides that, under certain
circumstances, the Company will be prohibited from making
any payments in respect of the Securities if the Company is
in default on any Senior Indebtedness.
9. Denominations; Transfer; Exchange
The Securities are in registered form, without
coupons, in denominations of $1,000 and whole multiples of
$1,000. A Holder may transfer or exchange Securities in
accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The
Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security
not to be redeemed) or any Securities for a period of
15 days before a selection of Securities to be redeemed or
15 days before an interest payment date.
10. Persons Deemed Owners
The registered Holder of this Security may be
treated as the owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent
shall pay the money back to the Company at its request
unless an abandoned property law designates another Person.
After any such payment, Holders entitled to the money must
look only to the Company and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any
time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with
the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the
Indenture, (i) the Indenture or the Securities may be
amended with the written consent of the Holders of at least
a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may
be waived with the written consent of the Holders of a
majority in principal amount outstanding of the Securities.
Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and
the Trustee may amend the Indenture or the Securities to
cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for
uncertificated Securities in addition to or in place of
certificated Securities, or to add guarantees with respect
to the Securities or to secure the Securities, or to add
additional covenants or surrender rights and powers
conferred on the Company, or to comply with the TIA or to
make certain changes in the subordination provisions, or to
make any change that does not adversely affect the rights of
any Securityholder.
14. Defaults and Remedies
Under the Indenture, Events of Default include
(i) default for 30 days in payment of interest on the
Securities; (ii) default in payment of principal on the
Securities at maturity, upon redemption pursuant to
paragraph 5 of the Securities, upon acceleration or
otherwise, or failure by the Company to redeem or purchase
Securities when required; (iii) failure by the Company to
comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of
time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other
Indebtedness of the Company if the amount accelerated (or so
unpaid) exceeds $10,000,000 and continues for 10 days after
the required notice to the Company; (v) certain events of
bankruptcy or insolvency with respect to the Company or any
Significant Subsidiary; and (vi) certain judgments or
decrees for the payment of money with respect to the Company
or any Significant Subsidiary in excess of $10,000,000. If
an Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the
Securities or, in certain circumstances, Ciba-Geigy Limited
may declare all the Securities to be due and payable
immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such
Events of Default.
Securityholders may not enforce the Indenture or
the Securities except as provided in the Indenture. The
Trustee may refuse to enforce the Indenture or the
Securities unless it receives reasonable indemnity or
security. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct
the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any
continuing Default (except a Default in payment of principal
or interest) if it determines that withholding notice is in
the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act,
the Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of
Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and
may otherwise deal with the Company or its Affiliates with
the same rights it would have if it were not Trustee.
16. No Recourse Against Others
Any director, officer, employee, stockholder or
Affiliate, as such, of the Company or the Trustee shall not
have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder
waives and releases all such liability. Such waiver and
release are part of the consideration for the issue of the
Securities.
17. Authentication
This Security shall not be valid until an
authorized signatory of the Trustee (or an authenticating
agent) manually signs the certificate of authentication on
the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of
a Securityholder or an assignee, such as TEN COM (=tenants
in common), TEN ENT (=tenants by the entireties), JT TEN
(=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform
Gift to Minors Act).
19. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the
Securities and has directed the Trustee to use CUSIP numbers
in notices of redemption as a convenience to
Securityholders. No representation is made as to the
accuracy of such numbers either as printed on the Securities
or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed
thereon.
THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER
UPON WRITTEN REQUEST TO THE SECURITYHOLDER A COPY OF THE
INDENTURE WHICH HAS IN IT THE TEXT OF THIS SECURITY IN
LARGER TYPE. REQUESTS MAY BE MADE TO:
ATTENTION OF
_________________________________________________________
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
_________________________
_________________________
_________________________
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.) ________
and irrevocably appoint agent to
transfer this Security on the books of the Company. The
agent may substitute another to act for him.
Date: ________________ Your Signature: _____________________
Sign exactly as your name appears on the other side of this
Security.
SIGNATURE GUARANTEE:
(SIGNATURE MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION)
OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY
PURCHASED BY THE COMPANY PURSUANT TO SECTION 4.06 OR 4.08 OF
THE INDENTURE, CHECK THE BOX:
( )
IF YOU WANT TO ELECT TO HAVE ONLY PART OF
THIS SECURITY PURCHASED BY THE COMPANY PURSUANT TO
SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT YOU
WANT TO BE PURCHASED: $__________
$
DATE: __________________ YOUR SIGNATURE:
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE
SECURITY)
SIGNATURE GUARANTEE:
(SIGNATURE MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION)
EXHIBIT B
RETENTION AGREEMENT, dated as of February 29,
1996, between Hexcel Corporation, a Delaware corporation
("Hexcel") and Ciba-Geigy Limited, a Swiss corporation
("CGL").
WHEREAS, CGL (directly or indirectly through one
or more wholly-owned subsidiaries) owns approximately 49.9
percent of the issued and outstanding common stock of
Hexcel.
WHEREAS, pursuant to the Strategic Alliance
Agreement, dated as of September 29, 1995, and as amended as
of December 12, 1995 and as further amended as of February
28, 1996, among CGL, Ciba-Geigy Corporation and Hexcel,
Hexcel has agreed to deliver to Ciba (as defined below) its
Increasing Rate Senior Subordinated Notes due 2003 (the
"Senior Subordinated Notes"), which are to be issued
pursuant to an Indenture, dated as of February 29, 1996 (the
"Indenture"), between Hexcel and First Trust of California,
National Association, as trustee (the "Trustee") thereunder.
WHEREAS, Hexcel and certain of its subsidiaries
have entered into a Credit Agreement dated as of February
29, 1996 (the "Credit Agreement"), with the financial
institutions named therein as lenders and/or as issuing
banks, Citibank, N.A., as U.S. administrative agent,
Citibank International plc, as European administrative
agent, and Credit Suisse, as syndication agent.
WHEREAS, under the terms of the Credit Agreement,
an Event of Default (as defined in the Credit Agreement)
shall occur (i) if, under certain circumstances, CGL shall
cease to hold directly or indirectly (through one or more
wholly-owned subsidiaries (each, a "Subsidiary", and CGL,
together with a Subsidiary that becomes an owner of any
Senior Subordinated Notes, "Ciba")) 100% in principal amount
of the Senior Subordinated Notes or (ii) CGL shall cease to
beneficially own, directly or indirectly, at least 40% of
the Voting Stock (as defined in the Credit Agreement) of the
Company.
NOW, THEREFORE, in consideration of the premises
and for the issuance of the Senior Subordinated Notes, CGL
agrees with Hexcel, for the benefit of Hexcel, as follows:
1. (A) Prior to the first to occur of (i) Xxxxx
0, 0000, (xx) the payment in full of all Obligations (as
defined in the Credit Agreement) and the termination of all
Commitments (as defined in the Credit Agreement) and (iii)
the extension of the Revolving Credit Termination Date (as
defined in the Credit Agreement) without the consent of CGL,
or (B) at any time when any Event of Default in Section
11.01 (a) of the Credit Agreement shall have occurred and be
continuing, CGL shall hold directly or indirectly (through
one or more Subsidiaries) one hundred percent (100%) of the
outstanding principal amount of the Senior Subordinated
Notes; provided that Ciba may transfer to any Subsidiary of
CGL all or any part of the Senior Subordinated Notes if such
Subsidiary complies with the provisions of the next
paragraph; and provided, further, that if a Subsidiary of
CGL becomes a holder of all or any portion of the Senior
Subordinated Notes as permitted by this Agreement, CGL may
effect a Broad Distribution (as defined in the Governance
Agreement (as defined in the Indenture)) of up to 20% of the
capital stock of such Subsidiary, but only if (1) such
distribution has a bona fide business purpose (other than
the sale or distribution of Senior Subordinated Notes) and
(2) the Senior Subordinated Notes "beneficially owned" (as
defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) by such Subsidiary do
not constitute a material portion of the total assets of
such Subsidiary.
CGL shall cause any Subsidiary of CGL that
acquires any portion of the Senior Subordinated Notes, from
any person whatsoever, whether upon original issuance or at
any time thereafter while CGL is required to hold, directly
or indirectly, 100% of the outstanding principal amount of
the Senior Subordinated Notes pursuant to the preceding
paragraph (each such transferee, a "Transferee"), to agree,
prior to, or concurrently with, acquiring such Senior
Subordinated Notes, to be bound by this Agreement by
executing an Agreement To Be Bound, substantially in the
form of Annex 1 to this Agreement, and delivering it to
Hexcel. Upon the execution and delivery of such Agreement
To Be Bound, all references in this Agreement to "Ciba"
shall include such Transferee. CGL shall cause each
Transferee to comply with terms of this Agreement.
2. CGL shall "beneficially own" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, at least forty percent (40%) of the Voting Stock
of the Company so long as the failure of CGL to do so would
result in an Event of Default under the Credit Agreement.
3. Until CGL is no longer required to hold,
directly or indirectly, 100% of the outstanding principal
amount of the Senior Subordinated Notes pursuant to the
first paragraph of Section 1 of this Agreement, except as
permitted by such Section 1, Ciba shall not sell, assign,
transfer or otherwise dispose of all or any portion of the
Senior Subordinated Notes, and any such purported sale,
assignment, transfer or other disposition shall be void and
of no effect, and Ciba shall not negotiate or grant any
lien, interest, pledge, charge, security interest or other
encumbrance of, or any participation in, all or any part of
the Senior Subordinated Notes or other liabilities owed
thereunder.
4. Subject to Section 5, the certificate or
certificates representing the Senior Subordinated Notes
shall bear the following legend, which shall appear on the
face of such certificates:
PURSUANT TO A RETENTION AGREEMENT, DATED AS OF
__________, 199[] (THE "RETENTION AGREEMENT"), BETWEEN
HEXCEL CORPORATION (THE "COMPANY") AND CIBA-GEIGY
LIMITED ("CGL"), A COPY OF WHICH IS ON FILE IN THE
OFFICES OF THE COMPANY, CGL AND ANY WHOLLY-OWNED
SUBSIDIARY OF CGL THAT HOLDS ANY OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE HAVE AGREED THAT CGL OR
SUCH SUBSIDIARY WILL HOLD THIS SECURITY UNTIL
RESTRICTION PROVIDED IN THE RETENTION AGREEMENT CEASE
TO BE EFFECTIVE, AND THEY HAVE AGREED THAT ANY
ATTEMPTED SALE, TRANSFER ASSIGNMENT OR OTHER
DISPOSITION OF THIS SECURITY TO A PERSON OTHER THAN CGL
OR A WHOLLY-OWNED SUBSIDIARY OF CGL PRIOR TO SUCH TIME
WILL BE NULL AND VOID AB INITIO.
5. As soon as practicable after the time that CGL
is no longer required to hold, directly or indirectly, 100%
of the outstanding principal amount of the Senior
Subordinated Notes pursuant to the first paragraph of
Section 1 of this Agreement, Hexcel (i) shall deliver
written notice to CGL of such event in the manner provided
for notice in the Credit Agreement and (ii) shall instruct
the Trustee to issue or cause to be issued to Ciba, or the
person or persons designated by Ciba, a replacement
certificate or replacement certificates representing the
Senior Subordinated Notes then held by them, without the
legend set forth in Section 3 of this Agreement, in exchange
for the certificate or certificates then held by such
persons. Such issuance shall be accomplished as provided
in, and pursuant to the terms of, the Indenture.
6. Ciba acknowledges that any breach of this
Agreement would cause irreparable injury to Hexcel that
could not reasonably or adequately be compensated in damages
in an action at law. Ciba agrees therefore that Hexcel
shall be entitled, in addition to any other of its rights or
remedies, to temporary, preliminary and permanent
injunction, without the necessity of proving the inadequacy
of monetary damages or in posting any bond or security,
enjoining or restraining Ciba from any such violation or
threatened violations, and other equitable relief to prevent
the violation of any provision of this Agreement by Ciba.
Neither this provision nor the exercise of any of its rights
under this Section 5 shall constitute a waiver by Hexcel of
any other rights that it may have to damages or otherwise.
7. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE
LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the date first
above written.
CIBA-GEIGY LIMITED
By: /s/ XXXX M.D. XXXXXXXXX
Name: Xxxx M.D. Xxxxxxxxx
Title: Head of Regional
Finance and Control
By: /s/ XXXXX XXXXXX
Name: Xxxxx Xxxxxx
Title: Senior Division
Counsel
HEXCEL CORPORATION
By: /s/ XXXXXXX X. XXXXXX
Name: Xxxxxxx X. Xxxxxx
Title: Vice President,
Chief Financial
Officer and
Treasurer
ANNEX 1
AGREEMENT TO BE BOUND
[Date]
The undersigned, a wholly-owned subsidiary of Ciba-
Geigy Limited ("CGL"), agrees to be bound by all the terms
and provisions of the Retention Agreement, dated _____,
1996, between Hexcel Corporation and CGL, that are
applicable to Ciba (as defined in the Retention Agreement),
as though the undersigned were a named party to such
Agreement.
[Name of Subsidiary]
By: ___________________
Name:
Title:
