EXHIBIT 4.1
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INDENTURE
DATED AS OF NOVEMBER 6, 1997
AMONG
XXXXXX, INC., AS ISSUER,
AND
XXXXXX PRODUCTS COMPANY, AS GUARANTOR,
AND
MARINE MIDLAND BANK, AS TRUSTEE
___________________
$150,000,000
10 3/8% SENIOR SUBORDINATED SECURITIES DUE 2007
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CROSS-REFERENCE TABLE
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
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(S) 310(a)(1).......................................... 7.10
(a)(2)............................................ 7.10
(a)(3)............................................ N.A.
(a)(4)............................................ N.A.
(a)(5)............................................ 7.08, 7.10.
(b)............................................... 7.08; 7.10; 13.02
(c)............................................... N.A.
(S) 311(a)............................................. 7.11
(b)............................................... 7.11
(c)............................................... N.A.
(S) 312(a)............................................. 2.05
(b)............................................... 13.03
(c)............................................... 13.03
(S)313(a).............................................. 7.06
(b)(1)............................................ 7.06
(b)(2)............................................ 7.06
(c)............................................... 7.06; 13.02
(d)............................................... 7.06
(S) 314(a)............................................. 4.11; 4.12; 13.02
(b)............................................... N.A.
(c)(1)............................................ 13.04
(c)(2)............................................ 13.04
(c)(3)............................................ N.A.
(d)............................................... N.A.
(e)............................................... 13.05
(f)............................................... N.A.
(S) 315(a)............................................. 7.01(b)
(b)............................................... 7.05; 13.02
(c)............................................... 7.01(a)
(d)............................................... 7.01(c)
(e)............................................... 6.11
(S) 316(a)(last sentence).............................. 2.09
(a)(1)(A)......................................... 6.05
(a)(1)(B)......................................... 6.04
(a)(2)............................................ N.A.
(b)............................................... 6.07
(c)............................................... 10.04
(S) 317(a)(1).......................................... 6.08
(a)(2)............................................ 6.09
(b)............................................... 2.04
(S) 318(a)............................................. 13.01
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions............................................. 1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act....... 18
SECTION 1.03. Rules of Construction................................... 18
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating......................................... 19
SECTION 2.02. Execution and Authentication............................ 20
SECTION 2.03. Registrar and Paying Agent.............................. 21
SECTION 2.04. Paying Agent to Hold Assets in Trust.................... 21
SECTION 2.05. Securityholder Lists.................................... 22
SECTION 2.06. Transfer and Exchange................................... 22
SECTION 2.07. Replacement Securities.................................. 22
SECTION 2.08. Outstanding Securities.................................. 23
SECTION 2.09. Treasury Securities..................................... 23
SECTION 2.10. Temporary Securities.................................... 23
SECTION 2.11. Cancellation............................................ 23
SECTION 2.12. Defaulted Interest...................................... 24
SECTION 2.13. CUSIP Number............................................ 24
SECTION 2.14. Deposit of Moneys....................................... 24
SECTION 2.15. Book-Entry Provisions for Global Securities............. 24
SECTION 2.16. Registration of Transfers and Exchanges................. 24
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee...................................... 29
SECTION 3.02. Selection of Securities to Be Redeemed.................. 29
SECTION 3.03. Notice of Redemption.................................... 29
SECTION 3.04. Effect of Notice of Redemption.......................... 30
SECTION 3.05. Deposit of Redemption Price............................. 30
SECTION 3.06. Securities Redeemed in Part............................. 30
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities................................... 31
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SECTION 4.02. Maintenance of Office or Agency......................... 31
SECTION 4.03. Limitation on Transactions with Affiliates.............. 31
SECTION 4.04. Limitation on Incurrence of Indebtedness................ 33
SECTION 4.05. Limitation on Asset Sales............................... 34
SECTION 4.06. Limitation on Restricted Payments....................... 36
SECTION 4.07. Corporate Existence..................................... 39
SECTION 4.08. Payment of Taxes and Other Claims....................... 39
SECTION 4.09. Notice of Defaults...................................... 40
SECTION 4.10. Maintenance of Properties and Insurance................. 40
SECTION 4.11. Compliance Certificate.................................. 40
SECTION 4.12. Provision of Financial Information...................... 41
SECTION 4.13. Waiver of Stay, Extension or Usury Laws................. 41
SECTION 4.14. Change of Control....................................... 41
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.......... 43
SECTION 4.16. Limitations on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries..................... 43
SECTION 4.17. Designation of Restricted and Non-Restricted Subsidiaries 44
SECTION 4.18. Limitation on Liens..................................... 45
SECTION 4.19. Limitation on Sale and Leaseback Transactions........... 45
SECTION 4.20. Subsidiary Guarantees................................... 45
SECTION 4.21. Limitations as to Unrestricted Subsidiaries............. 46
SECTION 4.22. Payments for Consent.................................... 46
SECTION 4.23. Limitation on Lines of Business......................... 46
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets................. 47
SECTION 5.02. Successor Corporation Substituted......................... 49
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default....................................... 49
SECTION 6.02. Acceleration............................................ 51
SECTION 6.03. Other Remedies.......................................... 51
SECTION 6.04. Waiver of Past Default.................................. 51
SECTION 6.05. Control by Majority..................................... 52
SECTION 6.06. Limitation on Suits..................................... 52
SECTION 6.07. Rights of Holders to Receive Payment.................... 53
SECTION 6.08. Collection Suit by Trustee.............................. 53
SECTION 6.09. Trustee May File Proofs of Claim........................ 53
SECTION 6.10. Priorities.............................................. 53
SECTION 6.11. Undertaking for Costs................................... 54
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ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee....................................... 54
SECTION 7.02. Rights of Trustee....................................... 55
SECTION 7.03. Individual Rights of Trustee............................ 56
SECTION 7.04. Trustee's Disclaimer.................................... 56
SECTION 7.05. Notice of Defaults...................................... 56
SECTION 7.06. Reports by Trustee to Holders........................... 57
SECTION 7.07. Compensation and Indemnity.............................. 57
SECTION 7.08. Replacement of Trustee.................................. 58
SECTION 7.09. Successor Trustee by Merger, etc........................ 59
SECTION 7.10. Eligibility; Disqualification........................... 59
SECTION 7.11. Preferential Collection of Claims Against Company....... 59
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior Indebtedness.......... 59
SECTION 8.02. No Payment on Securities in Certain Circumstances....... 60
SECTION 8.03. Payment Over of Proceeds upon Dissolution, etc.......... 61
SECTION 8.04. Subrogation............................................. 61
SECTION 8.05. Obligations of Company Unconditional.................... 62
SECTION 8.06. Notice to Trustee....................................... 62
SECTION 8.07. Reliance on Judicial Order or Certificate of Liquidating
Agent................................................. 63
SECTION 8.08. Trustee's Relation to Senior Indebtedness............... 63
SECTION 8.09. Subordination Rights Not Impaired by Acts or Omissions
of the Company or Holders of Senior Indebtedness......... 63
SECTION 8.10. Securityholders Authorize Trustee to Effectuate
Subordination of Securities........................... 64
SECTION 8.11. This Article Not to Prevent Events of Default........... 64
SECTION 8.12. Trustee's Compensation Not Prejudiced................... 64
SECTION 8.13. No Waiver of Subordination Provisions................... 64
SECTION 8.14. Subordination Provisions Not Applicable to Collateral
Held in Trust for Securityholders; Payments May Be
Paid Prior to Dissolution.............................. 64
SECTION 8.15. Acceleration of Securities.............................. 65
ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture.................................. 65
SECTION 9.02. Legal Defeasance........................................ 65
SECTION 9.03. Covenant Defeasance..................................... 66
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance... 66
SECTION 9.05. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions......... 68
SECTION 9.06. Reinstatement........................................... 68
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SECTION 9.07. Moneys Held by Paying Agent............................. 68
SECTION 9.08. Moneys Held by Trustee.................................. 69
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders............................. 69
SECTION 10.02. With Consent of Holders................................ 70
SECTION 10.03. Compliance with Trust Indenture Act.................... 71
SECTION 10.04. Revocation and Effect of Consents...................... 71
SECTION 10.05. Notation on or Exchange of Securities.................. 72
SECTION 10.06. Trustee to Sign Amendments, etc........................ 72
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee................................ 72
SECTION 11.02. Severability........................................... 73
SECTION 11.03. Limitation of Guarantor's Liability.................... 73
SECTION 11.04. Subordination of Subrogation and Other Rights.......... 73
SECTION 11.05. Execution and Delivery of Guarantee.................... 73
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor Senior
Indebtedness......................................... 74
SECTION 12.02. No Payment on Guarantee in Certain Circumstances....... 74
SECTION 12.03. Payment Over of Proceeds upon Dissolution, etc......... 75
SECTION 12.04. Subrogation............................................ 76
SECTION 12.05. Obligations of Guarantor Unconditional................. 76
SECTION 12.06. Notice to Trustee...................................... 77
SECTION 12.07. Reliance on Judicial Order or Certificate of Liquidating
Agent................................................ 77
SECTION 12.08. Trustee's Relation to Guarantor Senior Indebtedness.... 78
SECTION 12.09. Subordination Rights Not Impaired by Acts or Omissions
of the Guarantor or Holders of Guarantor Senior
Indebtedness......................................... 78
SECTION 12.10. Securityholders Authorize Trustee to Effectuate
Subordination of Guarantee........................... 78
SECTION 12.11. This Article Not to Prevent Events of Default.......... 78
SECTION 12.12. Trustee's Compensation Not Prejudiced.................. 79
SECTION 12.13. No Waiver of Guarantee Subordination Provisions........ 79
SECTION 12.14. Payments May Be Paid Prior to Dissolution.............. 79
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ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls........................... 79
SECTION 13.02. Notices................................................ 80
SECTION 13.03. Communications by Holders with Other Holders........... 81
SECTION 13.04. Certificate and Opinion as to Conditions Precedent..... 81
SECTION 13.05. Statements Required in Certificate or Opinion.......... 81
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.............. 81
SECTION 13.07. Governing Law.......................................... 82
SECTION 13.08. No Recourse Against Others............................. 82
SECTION 13.09. Successors............................................. 82
SECTION 13.10. Counterpart Originals.................................. 82
SECTION 13.11. Severability........................................... 82
SECTION 13.12. No Adverse Interpretation of Other Agreements.......... 82
SECTION 13.13. Legal Holidays......................................... 82
SIGNATURES............................................................... S-1
EXHIBIT A Form of Series A Security
EXHIBIT B Form of Series B Security
EXHIBIT C Form of Legend for Global Securities
EXHIBIT D Certificate to be delivered upon exchange or registration of
transfer of securities
EXHIBIT E Form of certification to be delivered in connection with
Regulation S transfers
_________________
NOTE: This Table of Contents shall not, for any purpose, be deemed to be a part
of the Indenture.
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INDENTURE dated as of November 6, 1997, between XXXXXX, INC., a
Delaware corporation (the "Company"), XXXXXX PRODUCTS COMPANY, a Delaware
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corporation (the "Guarantor"), and MARINE MIDLAND BANK, a New York banking
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corporation and trust company, as trustee (the "Trustee").
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Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Securities:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acceleration Notice" see Section 6.02.
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"Affiliate" with respect to any specified person means (i) any person
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directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person, (ii) any spouse, immediate family
member or other relative who has the same principal residence as any person
described in clause (i) above, (iii) any trust in which any such person
described in clause (i) or (ii) above has a beneficial interest, and (iv) any
corporation or other organization of which any such person described above
collectively owns 10% or more of the equity of such entity. For purposes of
this definition, "control" (including, with correlative meaning, the terms
"controlling," "controlled by" and "under common control with"), as used with
respect to any person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
person, whether through the ownership of voting securities, by agreement or
otherwise, provided that beneficial ownership of 10% or more of the voting
securities of a person shall be deemed to be control.
"Affiliate Transaction" see Section 4.03.
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"Agent" means any Registrar, Paying Agent or co-Registrar.
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"AM Cosmetics" means AM Cosmetics, Inc., a Delaware
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corporation.
"AM Cosmetics Broker Agreement" means the broker agreement dated as of
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September 19, 1997 between Xxxxxx Products and AM Cosmetics as in effect on the
Issue Date.
"AM Cosmetics Sales/Marketing Agreement" means the broker agreement
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and the commission agreement, each dated as of September 19, 1997 between Xxxxxx
Products and AM Cosmetics as in effect on the Issue Date.
"AM Manufacturing Agreement" means the manufacturing agreement dated
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as of April 30, 1997, between Xxxxxx Products and AM Cosmetics as in effect on
the Issue Date.
"Applicable Premium" means, with respect to a Security, the greater of
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(i) 1.0% of the then outstanding principal amount of such Security and (ii) the
excess of (A) the present value of all remaining required interest and principal
payments due on such Security, computed using a discount rate equal to the yield
to
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maturity at the time of computation of United States Treasury securities with
a constant maturity most nearly equal to the then remaining average life to
stated maturity of the Securities (the "Treasury Rate"), plus 50 basis points,
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over (B) the then outstanding principal amount of such Security. If the average
life to stated maturity of the Securities is not equal to the constant maturity
of a United States Treasury security for which a weekly average yield is given,
the Treasury Rate shall be obtained by linear interpolation (calculated to the
nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given. The Treasury Rate shall be
determined by reference to the yields published in the most recent Federal
Reserve Statistical Release H.15(519) which has become publicly available at
least two Business Days prior to the date fixed for purchase of the Securities
following a Disposition pursuant to clause (i)(B) of paragraph (a) of Section
5.01, or if such Statistical Release is no longer published, any publicly
available source of similar market data.
"Asset Sale" means the sale, lease, conveyance or other disposition by
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the Company or a Restricted Subsidiary of assets or property whether owned on
the Issue Date or thereafter acquired, in a single transaction or in a series of
related transactions; provided that Asset Sales will not include such sales,
leases, conveyances or dispositions in connection with (i) the surrender or
waiver of contract rights or the settlement, release or surrender of contract,
tort or other claims of any kind, (ii) the sale of inventory in the ordinary
course of business, (iii) a sale-leaseback of assets within one year following
the acquisition of such assets, (iv) the grant of any license of patents,
trademarks, registration therefor and other similar intellectual property, (v) a
transfer of assets by the Company or a Restricted Subsidiary to the Company or a
Restricted Subsidiary, (vi) the designation of a Restricted Subsidiary as an
Unrestricted Subsidiary pursuant to Section 4.17, (vii) the sale, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company as permitted by Section 5.01, (viii) the sale or disposition of
obsolete, worn out, damaged or otherwise unsuitable or unnecessary equipment or
other obsolete assets, (ix) Restricted Payments permitted by Section 4.06, (x)
the exchange of assets for other non-cash assets that (a) are useful in the
business of the Company and its Restricted Subsidiaries and (b) have a fair
market value at least equal to the fair market value of the assets being
exchanged (as determined by the Board of Directors or the board of directors
of the Restricted Subsidiary which owns such assets in good faith), (xi) the
sale or disposition of any Restricted Investment or Marketable Securities, (xii)
any Equity Offering by the Company or (xiii) a transaction or series of related
transactions that results in a Change of Control.
"Asset Sale Disposition Date" see Section 4.05.
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"Asset Sale Offer " see Section 4.05.
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"Asset Sale Purchase Date" see Section 4.05.
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"Asset Sale Trigger Date" see Section 4.05.
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"Attributable Debt" in respect of a sale and leaseback transaction
-----------------
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Bankruptcy Law" means Title 11, U.S. Code or any similar
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Federal or state law for the relief of debtors.
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"Board of Directors" means the Company's board of directors or
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any authorized committee of such board of directors.
"Business Day" means a day (other than a Saturday or Sunday) on which
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the Depository and banks in New York, and banks in the city in which the
Corporate Trust Office of the Trustee is located, are open for business.
"Capital Stock" means any and all shares, interests, participations or
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other equivalents (however designated) of corporate stock, including any
Preferred Stock.
"Xxxxxx-AM Management Agreement" means the management agreement dated
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June 26, 1996 between Xxxxxx Products and AM Cosmetics as in effect on the Issue
Date.
"Xxxxxx Products" means Xxxxxx Products Company, a Delaware
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corporation.
"Xxxxxx South Africa" means Xxxxxx Holdings Limited, a South
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African company.
"Cash Flow" means, for any given period and person, the sum of,
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without duplication, Consolidated Net Income, plus (a) any provision for taxes
based on income or profits to the extent such income or profits were included in
computing Consolidated Net Income, plus (b) Consolidated Interest Expense, to
the extent deducted in computing Consolidated Net Income, plus (c) the
amortization of all intangible assets, to the extent such amortization was
deducted in computing Consolidated Net Income (including, but not limited to,
inventory write-ups, goodwill, debt and financing costs), plus (d) all
depreciation and all other non-cash charges (including, without limitation,
those charges relating to purchase accounting adjustments and LIFO adjustments
but excluding charges recorded in anticipation of future cash expenditures and
non-cash Incentive Arrangements), to the extent deducted in computing
Consolidated Net Income, plus (e) any interest income, to the extent such income
was not included in computing Consolidated Net Income, plus (f) all dividend
payments on Preferred Stock (whether or not paid in cash) to the extent deducted
in computing Consolidated Net Income, plus (g) any extraordinary or non-
recurring charge or expense arising out of the implementation of SFAS 106 or
SFAS 109 to the extent deducted in computing Consolidated Net Income, plus (h)
any non-capitalized transaction costs incurred in connection with actual or
proposed financings, acquisitions or divestitures; provided, however, that if an
acquisition or sale of a person, business or asset or the issuance or repayment
of Indebtedness occurred during the given period or subsequent to such period
and on or prior to the date of calculation, then such calculation for such
period shall be made on a Pro Forma Basis.
"Cash Flow Coverage Ratio" means, for any given period and person, the
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ratio of (i) Cash Flow divided by (ii) Consolidated Interest Expense (except
dividends paid or payable in additional shares of Capital Stock (other than
Disqualified Stock)) in each case, without duplication; provided, however, that
if an acquisition or sale of a person, business or asset or the issuance or
repayment of Indebtedness occurred during the given period or subsequent to such
period and on or prior to the date of calculation, then such calculation for
such period shall be made on a Pro Forma Basis.
"CEDEL" means Cedel Bank, societe anonyme (or any successor
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securities clearing agency).
"Certificated Securities" see Section 2.01.
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"Change of Control" means the occurrence of any of the following: (i)
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any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), excluding the Permitted
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Holders, is or becomes the "beneficial owner" (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that a person shall be deemed to have
"beneficial ownership" of all securities that such person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of more than 50% of the total Voting Stock of
the Company; or (ii) the Company consolidates with, or merges with or into,
another person or sells, assigns, conveys, transfers, leases or otherwise
disposes of all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole, to any person, or any person consolidates with,
or merges with or into, the Company, in any such event pursuant to a transaction
in which the outstanding Voting Stock of the Company is converted into or
exchanged for cash, securities or other property, other than any such
transaction where (A) the outstanding Voting Stock of the Company is converted
into or exchanged for (1) Voting Stock (other than Disqualified Stock) of the
surviving or transferee corporation or (2) cash, securities and other property
in an amount which could be paid by the Company as a Restricted Payment under
the Indenture and (B) immediately after such transaction no "person" or "group"
(as such terms are used in Sections 13(d) and 14(d) of the Exchange Act),
excluding the Permitted Holders, is the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to
have "beneficial ownership" of all securities that such person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of more than 50% of the total Voting Stock of
the surviving or transferee corporation; or (iii) during any consecutive two-
year period, individuals who at the beginning of such period constituted the
Board of Directors (together with any new directors whose election by such Board
of Directors or whose nomination for election by the stockholders of the Company
was approved by a vote of a majority of the directors then still in office who
are entitled to vote to elect such new directors and were either directors at
the beginning of such period or persons whose election as directors or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors of the Company then in office.
Notwithstanding the foregoing, a Change of Control shall not be deemed to result
from a Disposition described below in clause (i)(B) of paragraph (a) of Section
5.01.
"Change of Control Offer" see Section 4.14.
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"Change of Control Purchase Date" see Section 4.14.
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"Change of Control Trigger Date" see Section 4.14.
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"Commission" means the Securities and Exchange Commission.
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"Company" means the Person named as the "Company" in the first
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paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor.
"Company Request" or "Company Order" means a written request or order
--------------- -------------
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President, a Vice President or its Treasurer, and by
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Consolidated Interest Expense" means, for any given period and
-----------------------------
person, the aggregate of (i) the interest expense in respect of all Indebtedness
of such person and its Restricted Subsidiaries for such period, on a
consolidated basis, determined in accordance with GAAP (including, without
duplication, amortization of original issue discount on any such Indebtedness,
all non-cash interest payments, the interest portion of any deferred payment
obligation, the interest component of capital lease obligations, and
amortization of deferred financing fees) and (ii) the product of (a) all cash
dividend payments (and, in the case of a Person that is a Restricted Subsidiary,
dividends paid or payable in additional shares of Disqualified Stock) on any
series of pre-
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ferred stock of such Person and its Restricted Subsidiaries payable to a party
other than the Company or a wholly owned Subsidiary, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, on a consolidated basis and in accordance with GAAP;
provided, however, that for the purpose of the Cash Flow Coverage Ratio,
Consolidated Interest Expense shall be calculated on a Pro Forma Basis; provided
further that any premiums, fees and expenses (including the amortization
thereof) payable in connection with the Offering and the application of the net
proceeds therefrom or any other refinancing of Indebtedness will be excluded.
"Consolidated Net Income" means, for any given period and person, the
-----------------------
aggregate of the Net Income of such person and its Restricted Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided, however, that: (i) the Net Income of any person acquired in a pooling
of interests transaction for any period prior to the date of such acquisition
shall be excluded, (ii) the Net Income of any person that is not a Restricted
Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions paid in
cash to the referent person, (iii) the Net Income of, or any dividends or other
distributions from, any Unrestricted Subsidiary shall be included only to the
extent of the amount of dividends or distributions paid in cash to the referent
person, (iv) the Net Income of any Restricted Subsidiary shall be excluded to
the extent that the declaration or payment of dividends or similar distributions
by that Restricted Subsidiary of that Net Income is not at the date of
determination permitted without any prior governmental approval (which has not
been obtained) or, directly or indirectly, by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Restricted Subsidiary or its
stockholders, (v) the cumulative effect of a change in accounting principles
shall be excluded, (vi) income or loss attributable to discontinued operations
shall be excluded; and (vii) all other extraordinary, unusual or nonrecurring
gains and losses shall be excluded; provided, however, that for purposes of
determining the Cash Flow Coverage Ratio, Consolidated Net Income shall be
calculated on a Pro Forma Basis.
"Corporate Trust Office of the Trustee" shall be at the address of the
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Trustee specified in Section 13.02 or such other address as the Trustee may give
notice to the Company.
"Covenant Defeasance Option" see Section 9.03.
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"Custodian" means any receiver, trustee, assignee, liquidator
---------
or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage
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of time or both would be, an Event of Default.
"defeasance trust" see Section 9.04.
----------------
"Depository" means, with respect to the Securities issued in the form
----------
of one or more Global Securities, The Depository Trust Company or another Person
designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
"Designated Guarantor Senior Indebtedness" means (i) the guarantee by
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any Guarantor of any Indebtedness outstanding under the New Credit Facility and
(ii) any other Senior Indebtedness of such Guarantor permitted under this
Indenture the principal amount of which is $10,000,000 or more and that has been
designated by such Guarantor as "Designated Guarantor Senior Indebtedness."
-6-
"Designated Senior Indebtedness" means (i) any Indebtedness
------------------------------
outstanding under the New Credit Facility and (ii) any other Senior Indebtedness
permitted under this Indenture the principal amount of which is $10,000,000 or
more and that has been designated by the Company as "Designated Senior
Indebtedness."
"Disposition" see Section 5.01.
-----------
"Disqualified Stock" with respect to any person means any Capital
------------------
Stock or Equity Interests that by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable other than at the
Company's option), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part on, or prior to, the
maturity date of the Securities other than for Equity Interests (other than
Disqualified Stock).
"Distribution Agreement" means the distribution agreement dated May
----------------------
14, 1996 between Xxxxxx Products S.A. and Xxxxxx Products as in effect on the
Issue Date.
"Eligible Institution" means a commercial banking institution that has
--------------------
combined capital and surplus of not less than $500.0 million or its equivalent
in foreign currency, whose debt is rated "A" (or higher) according to S&P or
Moody's at the time as of which any investment or rollover therein is made.
"Equity Interests" means Capital Stock or partnership interests or
----------------
warrants, options or other rights to acquire Capital Stock or partnership
interests (but excluding (i) any debt security that is by its terms convertible
into, or exchangeable for, Capital Stock or partnership interests, and (ii) any
other Indebtedness or Obligation); provided, however, that Equity Interests will
not include any Incentive Arrangements or obligations or payments thereunder.
"Equity Offering" means a public or private offering by the Company
---------------
for cash of Capital Stock or other Equity Interests and all warrants, options or
other rights to acquire Capital Stock, other than (i) an offering of
Disqualified Stock or (ii) Incentive Arrangements or obligations or payments
thereunder.
"Euroclear" means the Euroclear Clearance System (or any
---------
successor securities clearing agency).
"Event of Default" see Section 6.01.
----------------
"Excess Proceeds" see Section 4.05.
---------------
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations promulgated by the Commission thereunder.
"Existing Affiliate Agreement" see Section 4.03.
----------------------------
"Foreign Proceeds" see Section 4.05.
----------------
"Foreign Subsidiary" means a direct or indirect Subsidiary of the
------------------
Company organized outside the United States of America and conducting the
majority of its business in its jurisdiction of organization or in other
jurisdictions outside the United States of America.
-7-
"GAAP" means generally accepted accounting principles, consistently
----
applied, as in effect from time to time in the United States of America. All
financial and accounting determinations and calculations under the Indenture
will be made in accordance with GAAP.
"Global Security" means a security evidencing all or a portion of the
---------------
Securities issued to the Depository or its nominee in accordance with Section
2.01 and bearing the legend set forth in Exhibit C hereto.
---------
"Government Securities" means direct obligations of, or obligations
---------------------
guaranteed by, the United States of America for the payment of which the full
faith and credit of the United States of America is pledged.
"Guarantee" means the guarantee of the Obligations of the Company with
---------
respect to the Securities by the Guarantor pursuant to the terms of Article 11
hereof.
"Guaranteed Obligations" see Section 11.01.
----------------------
"Guarantor" means Xxxxxx Products and, pursuant to Section 4.20,
---------
certain other Subsidiaries of the Company in the future.
"Guarantor Blockage Period" see Section 12.02(a).
-------------------------
"Guarantor Payment Blockage Notice" see Section 12.02(a).
---------------------------------
"Hedging Obligations" means, with respect to any person, the
-------------------
Obligations of such persons under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, (ii) foreign exchange
contracts, currency swap agreements or similar agreements, and (iii) other
similar agreements or arrangements, in each case designed solely to protect such
person against fluctuations of exchange rates, currency rates or interest rates;
provided, that the notional amount of any such Hedging Obligation shall not
exceed the principal amount of the underlying Obligation to which such Hedging
Obligation relates.
"Holder," "holder of Securities," "Securityholders" or other similar
------ -------------------- ---------------
terms mean the registered holder of any Security.
"Incentive Arrangements" means any employment agreements, employee
----------------------
stock option agreements, employee equity subscription agreements, non-
competition agreements, stock plans, stock option plans, stock appreciation
rights and other incentive and bonus plans and similar arrangements made in
connection with acquisitions of persons or businesses by the Company or the
Restricted Subsidiaries or the retention of directors or employees by the
Company or the Restricted Subsidiaries.
"Indebtedness" means, with respect to any person, (i) any
------------
indebtedness, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or bankers acceptances
or representing the deferred and unpaid balance of the purchase price of any
property (including pursuant to capital leases), except any such balance that
constitutes an accrued expense or a trade payable, any Hedging Obligations, if
and to the extent such indebtedness (other than a Hedging Obligation) would
appear as a liability upon a balance sheet of such person prepared on a
consolidated basis in accordance with GAAP, and any indebtedness of others of
the type described in this clause (i) secured by a Lien on any asset of such
person (whether or not such indebtedness is assumed by such person) (the amount
of such indebtedness being deemed to be the lesser of the value of such assets
or the indebtedness being so secured) and also includes, to the extent not
otherwise included, the guarantee of items
-8-
that would be included within this definition; (ii) Disqualified Stock of such
person, valued at the maximum fixed redemption or repurchase price in respect
thereof; or (iii) Preferred Stock issued by a Restricted Subsidiary of such
person; provided, however, that "Indebtedness" shall not include any Incentive
Arrangements or obligations or payments thereunder or the pledge by the Company
of its Equity Interests in an Unrestricted Subsidiary of the Company to secure
Non-Recourse Debt of such Unrestricted Subsidiary.
"Indenture" means this Indenture as amended or supplemented
---------
from time to time.
"Independent Director" means a director who has not and whose
--------------------
Affiliates have not, directly or indirectly, at any time during the twelve
months prior to the taking of any action which, under the terms of the
Indenture, requires the approval of Independent Directors of the Company or a
Restricted Subsidiary, received, or entered into any understanding or agreement
to receive, any compensation, payment or other benefit, of any type or form,
from the Company, any Restricted Subsidiary or any of their respective
Affiliates, other than customary directors fees (including pursuant to Incentive
Arrangements) and reimbursement of out-of-pocket expenses.
"Initial Purchasers" means Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
------------------
Corporation and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
------------------------------------
bankruptcy or similar case or proceeding, or any reorganization, receivership,
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, or (ii) any assignment for the benefit of creditors or any other
marshaling of assets and liabilities of the Company.
"Interest Payment Date" means each semiannual interest payment date on
---------------------
May 1 and November 1 of each year, commencing May 1, 1998.
"Interest Record Date" for the interest payable on any Interest
--------------------
Payment Date (except a date for payment of defaulted interest) means the April
15 or October 15 (whether or not a Business Day), as the case may be,
immediately preceding such Interest Payment Date.
"Investment" means any capital contribution to, or other debt
----------
or equity investment in, any Person.
"issue" means create, issue, assume, guarantee, incur or otherwise
-----
become directly or indirectly liable for any Indebtedness or Capital Stock, as
applicable; provided, however, that any Indebtedness or Capital Stock of a
person existing at the time such person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be issued
by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary.
For this definition, the terms "issuing," "issuer," "issuance" and "issued" have
meanings correlative to the foregoing.
"Issue Date" means November 6, 1997.
----------
"Legal Defeasance Option" see Section 9.02.
-----------------------
"License Agreement" means the license agreement dated April 7, 1994
-----------------
between Xxxxxx Products S.A. and Xxxxxx Products as in effect on the Issue Date.
-9-
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
----
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including, without limitation, any conditional sale or other title retention
agreement, any lease in the nature thereof, any other agreement to sell or give
a security interest).
"Liquidated Damages" has the meaning provided in the
------------------
Registration Rights Agreement.
"Marketable Securities" means (a) Government Securities, (b) any
---------------------
certificate of deposit maturing not more than 270 days after the date of
acquisition issued by, or time deposit of, an Eligible Institution, (c) any
bankers acceptances or money market deposit accounts issued by an Eligible
Institution and (d) securities issued by any fund investing exclusively in
investments of the types described in clauses (a) through (c) above.
"Maturity Date" means November 1, 2007.
-------------
"Moody's" means Xxxxx'x Investors Service, Inc.
-------
"Morningside" means Morningside Capital Group, L.L.C., a
-----------
Connecticut limited liability company.
"Morningside Management Agreement" means the management assistance
--------------------------------
agreement dated August 23, 1995 between Xxxxxx Products and Morningside as in
effect on the Issue Date.
"Net Income" means, with respect to any person, the net income (loss)
----------
of such person, determined in accordance with GAAP, excluding, however, any gain
or loss, together with any related provision for taxes, realized in connection
with any Asset Sale (including, without limitation, dispositions pursuant to
sale and leaseback transactions).
"Net Proceeds" means, with respect to any Asset Sale, the aggregate
------------
amount of cash proceeds (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, and including
any amounts received as disbursements or withdrawals from any escrow or similar
account established in connection with any such Asset Sale, but, in either such
case, only as and when so received) received by the Company or any of its
Restricted Subsidiaries in respect of such Asset Sale, net of: (i) the cash
expenses of such Asset Sale (including, without limitation, the payment of
principal of, and premium, if any, and interest on, Indebtedness required to be
paid as a result of such Asset Sale (other than the Securities) and legal,
accounting, management and advisory and investment banking fees and sales
commissions), (ii) taxes paid or payable as a result thereof, (iii) any portion
of cash proceeds that the Company determines in good faith should be reserved
for post-closing adjustments, it being understood and agreed that on the day
that all such post-closing adjustments have been determined, the amount (if any)
by which the reserved amount in respect of such Asset Sale exceeds the actual
post-closing adjustments payable by the Company or any of its Restricted
Subsidiaries shall constitute Net Proceeds on such date, (iv) any relocation
expenses and pension, severance and shutdown costs incurred as a result thereof
and (v) any cash amounts actually set aside by the Company or any Restricted
Subsidiary as a reserve in accordance with GAAP against any retained liabilities
associated with the asset disposed of in such transaction, including, without
limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with such transaction.
-10-
"New Credit Facility" means the credit agreement to be entered into on
-------------------
the Issue Date among the Company, Xxxxxx Products Company and the guarantors
named therein, and Credit Agricole Indosuez as agent and lender, and the other
lenders party thereto, together with all loan documents and instruments
thereunder (including, without limitation, any guarantee agreements and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from time
to time, including any agreement extending the maturity of, refinancing,
renewing, refunding, replacing or otherwise restructuring (including, without
limitation, increasing the amount of available borrowings thereunder, and all
Obligations with respect thereto, in each case, to the extent permitted by
Section 4.04 or adding Subsidiaries of the Company as additional borrowers or
guarantors thereunder) all or any portion of the Indebtedness under such
agreement or any successor or replacement agreement and whether by the same or
any other agent, lender or group of lenders.
"Non-Recourse Debt" means Indebtedness (i) as to which neither the
-----------------
Company nor any of its Restricted Subsidiaries (a) provides any guarantee or
credit support of any kind (including any undertaking, guarantee, indemnity,
agreement or instrument that would constitute Indebtedness) or (b) is directly
or indirectly liable (as a guarantor or otherwise) and (ii) the explicit terms
of which provide that there is no recourse against any of the assets of the
Company or its Restricted Subsidiaries (other than to Equity Interests in an
Unrestricted Subsidiary pledged by the Company or a Restricted Subsidiary);
provided, however, that the Company or any Restricted Subsidiary may make a loan
to an Unrestricted Subsidiary if such loan is permitted by Section 4.06 at the
time of the issuance of the loan, and such loan shall not constitute
Indebtedness which is not Non-Recourse Debt.
"Obligations" means, with respect to any Indebtedness, all principal,
-----------
interest, premiums, penalties, fees, indemnities, expenses (including legal fees
and expenses), reimbursement obligations and other liabilities payable to the
holder of such Indebtedness under the documentation governing such Indebtedness,
and any other claims of such holder arising in respect of such Indebtedness.
"Officer" means the Chairman, the Vice Chairman, the President, any
-------
Vice President, the Chief Financial Officer, or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers or
---------------------
by an Officer and an Assistant Treasurer or Assistant Secretary of the Company
complying with Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Other Company Indebtedness" see Section 4.20.
--------------------------
"Other Permitted Indebtedness" means (i) Indebtedness of the Company
----------------------------
and the Restricted Subsidiaries existing as of the Issue Date and all related
Obligations as in effect on such date; (ii) Indebtedness of the Company and the
Restricted Subsidiaries in respect of bankers acceptances and letters of credit
(including, without limitation, letters of credit in respect of workers'
compensation claims) issued in the ordinary course of business, or other
Indebtedness in respect of reimbursement-type obligations regarding workers'
compensation claims; (iii) Refinancing Indebtedness, provided that: (A) the
principal amount of such Refinancing Indebtedness shall not exceed the
outstanding principal amount of Indebtedness (including unused commitments)
extended, refinanced, renewed, replaced, substituted or refunded plus any
amounts incurred to pay premiums, fees and expenses in connection therewith, (B)
the Refinancing Indebtedness (other than Refinancing Indebtedness with respect
to Senior Indebtedness) shall have a Weighted Average Life to Maturity equal to
or greater than the
-11-
Weighted Average Life to Maturity of the Indebtedness being extended,
refinanced, renewed, replaced, substituted or refunded; provided, however, that
this limitation in this clause (B) does not apply to Refinancing Indebtedness of
Senior Indebtedness, provided, however, that this limitation in this clause (B)
does not apply to Refinancing Indebtedness of Senior Indebtedness, and (C) in
the case of Refinancing Indebtedness of Subordinated Indebtedness, such
Refinancing Indebtedness shall be subordinated to the Securities at least to the
same extent as the Subordinated Indebtedness being extended, refinanced,
renewed, replaced, substituted or refunded; (iv) Intercompany Indebtedness of
and among the Company and the Restricted Subsidiaries (excluding guarantees by
the Company or a Restricted Subsidiary of Indebtedness of the Company or a
Restricted Subsidiary, as the case may be, not issued in compliance with Section
4.20; (v) Indebtedness of the Company and the Restricted Subsidiaries under
Hedging Obligations; (vi) Indebtedness of the Company and its Restricted
Subsidiaries arising from the honoring by a bank or other financial institution
of a check, draft or similar instrument inadvertently (except in the case of
daylight overdrafts, which will not be, and will not be deemed to be,
inadvertent) drawn against insufficient funds in the ordinary course of
business; (vii) guarantees by the Company or any Guarantor of Indebtedness of
the Company or of a Restricted Subsidiary if the Indebtedness so guaranteed is
permitted under the Indenture; (viii) guarantees by any Foreign Subsidiary of
Indebtedness of another Foreign Subsidiary if the Indebtedness so guaranteed is
permitted under the Indenture; (ix) Indebtedness of the Company and its
Restricted Subsidiaries in connection with performance, surety, completion,
statutory, appeal or similar bonds in the ordinary course of business; and (x)
Indebtedness of the Company and any Restricted Subsidiary (other than for
borrowed money) in connection with agreements providing for indemnification,
purchase price adjustments and similar obligations in connection with the sale
or disposition of any of its business, property or assets.
"Paying Agent" see Section 2.03.
------------
"Payment Blockage Notice" see Section 8.02(a).
-----------------------
"Payment Blockage Period" see Section 8.02(a).
-----------------------
"Permitted Holders" means (i) DNL Partners Limited Partnership; (ii)
-----------------
DNL Group, LLC; (iii) Morningside Capital Group, LLC; (iv) Xxxxxxx X. Xxxxx, X.
Xxxxxxx Xxxxxxxxxx and Xxxxxxxx X. Xxxxxxxx, XX or any of their respective
spouses or lineal descendants; (v) any controlled Affiliate of any of the
persons or entities described in clauses (i), (ii), (iii) and (iv); (vi) in the
event of the incompetence or death of any of the individuals described in clause
(iv), such person's estate, executor, administrator, committee or other personal
representative, in each case who at any particular date will beneficially own or
have the right to acquire, directly or indirectly, Capital Stock of the Company;
or (vii) any trusts created for the benefit of each of the persons or entities
described in this definition, including any trust for the benefit of the parents
or siblings of any of the individuals described in clause (iv) or any trust for
the benefit of any such trust.
"Permitted Junior Securities" means Equity Interests in the Company or
---------------------------
subordinated debt securities of the Company that (i) are subordinated to all
Senior Indebtedness (and any debt securities issued in exchange for Senior
Indebtedness) to at least the same extent as the securities are Subordinated to
Senior Indebtedness pursuant to Article 8 of the Indenture, (ii) have a Weighted
Average Life to Maturity no shorter than the Weighted Average Life to Maturity
of the Securities and (iii) if there are any amounts outstanding under the New
Credit Facility, have a Weighted Average Life to Maturity at least as long as
the sum of (a) the Weighted Average Life to Maturity of the New Credit Facility
or any debt securities issued in exchange therefor (whichever is longer) plus
(b) the positive difference, if any, between the Weighted Average Life to
Maturity of the Securities and the Weighted Average Life to Maturity of the New
Credit Facility, in each case measured immediately prior to the issuance of such
Permitted Junior Securities.
-12-
"Permitted Liens" means, with respect to the Company and its
---------------
Restricted Subsidiaries, (1) Liens for taxes, assessments, governmental charges
or claims either (a) not delinquent or (b) contested in good faith by
appropriate proceedings and as to which the Company or any of its Subsidiaries
shall have set aside on its books such reserves as may be required pursuant to
GAAP; (2) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent or being
contested in good faith, if such reserve or other appropriate provision, if any,
as shall be required by GAAP shall have been made in respect thereof; (3) Liens
incurred on deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, governmental contracts, performance, completion
and return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money) or to secure obligations arising
from statutory, regulatory, contractual or warranty requirements; (4) judgment
Liens not giving rise to a Default or an Event of Default so long as such Lien
is adequately bonded and any appropriate legal proceedings which may have been
duly initiated for the review of such judgment shall not have been finally
terminated or the period within which such proceedings may be initiated shall
not have expired; (5) easements, rights-of-way, zoning restrictions, minor
defects or irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the business of
the Company or any of its Subsidiaries; (6) any interest or title of a lessor
under any capital lease or operating lease; (7) purchase money Liens to finance
the acquisition or construction of property or assets of the Company or any
Subsidiary of the Company acquired or constructed in the ordinary course of
business; provided, however, that (i) the related purchase money Indebtedness
shall not be secured by any property or assets of the Company or any Subsidiary
of the Company other than the property and assets so acquired or constructed and
(ii) the Lien securing such Indebtedness either (x) exists at the time of such
acquisition or construction or (y) shall be created within 100 days of such
acquisition or completion of construction, repair, improvement, addition or
commencement of full operation of the property subject to such Liens; (8) Liens
in favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods; (9) Liens
securing Indebtedness under Hedging Obligations; (10) Liens arising out of
consignment or similar arrangements for the sale of goods and Liens upon
specific items of inventory or other goods and proceeds of any person securing
such person's obligations in respect of bankers' acceptances issued or created
for the account of such person to facilitate the purchase, shipment or storage
of such inventory or other goods, entered into by the Company or any Restricted
Subsidiary in the ordinary course of business; (11) Liens in favor of the
Company or a Guarantor securing intercompany Indebtedness issued by the Company
or any Restricted Subsidiary to the Company or a Guarantor; (12) Liens on
property or assets of a person acquired by or merged with or into or
consolidated with the Company or any Restricted Subsidiary at the time of such
acquisition, merger or consolidation, provided that such Liens were not incurred
in contemplation of such acquisition, merger or consolidation; (13) Liens on
property or shares of Capital Stock of a person existing at the time such person
becomes a Restricted Subsidiary, provided that such Liens were not incurred in
contemplation of such person becoming a Restricted Subsidiary; (14) Liens on
property or assets existing at the time of acquisition, construction or
improvement thereof by the Company or any Restricted Subsidiary, provided that
such Liens were not incurred in contemplation of such acquisition, construction
or improvement; (15) Liens to secure Attributable Debt that is permitted to be
incurred pursuant to Section 4.19; (16) Liens securing industrial revenue bonds,
provided, the Indebtedness represented thereby is permitted under the Indenture;
(17) Liens securing reimbursement obligations with respect to letters of credit
incurred in the ordinary course which encumber documents and other property
relating to such letters of credit and the products and proceeds thereof,
provided, the Indebtedness represented thereby is permitted under the Indenture;
(18) Liens on assets or Capital Stock of Unrestricted Subsidiaries; (19) Liens
to secure Indebtedness permitted to be incurred under clauses (i), (ii) and
(iii) of the second sentence under Section 4.04 provided that such Liens extend
only to the assets of the person directly issuing such
-13-
Indebtedness; and (20) additional Liens at any one time outstanding in respect
of property or assets of which the aggregate fair market value (determined on
the date such Lien is granted) does not exceed $10.0 million.
"Person" means any individual, corporation, limited liability company,
------
limited or general partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Preferred Stock" of any person means Capital Stock of such person of
---------------
any class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such person, to shares of Capital
Stock of any other class of such person.
"Private Placement Legend" means the legend initially set forth on the
------------------------
Securities in the form set forth on Exhibit A hereto.
---------
"Pro Forma Basis" means, for purposes of determining Consolidated Net
---------------
Income in connection with the Cash Flow Coverage Ratio (including in connection
with Sections 4.06, 4.17 and 5.01 and the incurrence of Indebtedness pursuant to
the first sentence of Section 4.04, giving pro forma effect to (x) any
acquisition, by way of merger, consolidation or otherwise, or sale of a person,
business or asset, related incurrence, repayment or refinancing of Indebtedness
or other related transactions, including any Restructuring Charges which would
otherwise be accounted for as an adjustment permitted by Regulation S-X under
the Securities Act or on a pro forma basis under GAAP, or (y) any incurrence,
repayment or refinancing of any Indebtedness and the application of the proceeds
therefrom, in each case, which occurred during the relevant period or subsequent
to such period and on or prior to the date of calculation, as if such
acquisition or sale and related transactions, restructurings, consolidations,
cost savings, reductions, incurrence, repayment or refinancing were realized on
the first day of the relevant period permitted by Regulation S-X under the
Securities Act or on a pro forma basis under GAAP. For purposes of this
definition, whenever pro forma effect is to be given to an acquisition of a
person, business or asset, the amount of income or earnings relating thereto,
and the amount of Consolidated Interest Expense associated with any Indebtedness
issued in connection therewith, the pro forma calculations will be determined in
good faith by the chief financial officer of the Company as specified in an
officer's certificate of the Company delivered to the Trustee. Furthermore, in
calculating the Cash Flow Coverage Ratio, (1) interest on outstanding
Indebtedness determined on a fluctuating basis as of the determination date and
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the determination date; (2) if interest on any
Indebtedness actually incurred on the determination date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the determination date will be deemed to have been in effect during
the relevant period; and (3) notwithstanding clause (1) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to interest rate swaps or similar interest rate
protection Hedging Obligations, shall be deemed to accrue at the rate per annum
resulting after giving effect to the operation of such agreements.
"Purchase Agreement" means the Purchase Agreement dated October 31,
------------------
1997 between the Company, the Guarantors and the Initial Purchasers.
"Qualified Institutional Buyer" or "QIB" means a "qualified
----------------------------- ---
institutional buyer" as that term is defined in Rule 144A under the Securities
Act.
-14-
"Redemption Date," when used with respect to any Security to be
---------------
redeemed, means the date fixed for such redemption pursuant to this Indenture.
"redemption price," when used with respect to any Security to be
----------------
redeemed, means the price fixed for such redemption pursuant to this Indenture
as set forth in the form of Security annexed hereto as Exhibit A.
---------
"Refinancing Indebtedness" means Indebtedness of the Company and its
------------------------
Restricted Subsidiaries issued or given in exchange for, or the proceeds of
which are used to, extend, refinance, renew, replace, substitute or refund
Indebtedness Incurred in accordance with Section 4.04 or any Indebtedness issued
to so extend, refinance, renew, replace, substitute or refund such Indebtedness
and any additional Indebtedness issued solely to pay premiums required by the
agreement governing such Indebtedness, and reasonable fees and expenses incurred
by the Company or any Restricted Subsidiary in connection therewith.
"Register" see Section 2.03.
--------
"Registered Exchange Offer" means the offer to exchange the Series B
-------------------------
Securities for all of the outstanding Series A Securities in accordance with the
Registration Rights Agreement.
"Registrar" see Section 2.03.
---------
"Registration" means the registration of the Registered Exchange Offer
------------
by the Company and the Guarantor or other registration of the Securities under
the Securities Act pursuant to and in accordance with the terms of the
Registration Rights Agreement.
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement dated as of November , 1997 between the Company, the Guarantors and
the Initial Purchasers.
"Registration Statement" means the registration statement(s) as
----------------------
defined and described in the Registration Rights Agreement.
"Regulation S" means Regulation S under the Securities Act.
------------
"Regulation S Global Security" see Section 2.01.
----------------------------
"Restricted Investment" means any Investment in any person; provided
---------------------
that Restricted Investments will not include: (i) Investments in Marketable
Securities and other negotiable instruments permitted by the Indenture; (ii)
Investments in the Company; or (iii) Investments in any Restricted Subsidiary
or in a Person that becomes a Restricted Subsidiary or is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Company or a Restricted
Subsidiary, in each case as a result of such investment; (iv) the
extension of credit to vendors, suppliers and customers in the ordinary course
of business; (v) faith))Investments which exist on the Issue
Date; (vi) payments made pursuant to Incentive Arrangements (including
repurchases of Equity Interests deemed to occur upon exercise of stock options,
warrants or similar rights if such Equity Interests represent a portion of the
exercise price of such options, warrants or similar rights); (vii) any loan, and
any refinancing of such loan, made to management to enable management to
purchase Equity Interests in the Company; (viii) any Investments made or
received in connection with Hedging Obligations; (ix) Investments made or
received in connection with the sale, transfer or disposition of any business,
properties or assets of the Company or any Restricted Subsidiary of the Company,
provided that if such
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sale, transfer or disposition constitutes an Asset Sale and the Company complies
with Section 4.05, such Investment shall not count as a Restricted Payment for
purposes of the calculation in paragraph (c) of Section 4.06; (x) any
acquisition of assets solely in exchange for the issuance of Equity Interests
(other than Disqualified Stock) of the Company; (xi) the payment of cash in lieu
of fractional shares in connection with dividends or distributions permitted by
clause (i) of the first sentence of Section 4.06; (xii) loans or advances to
employees or directors of the Company or any Restricted Subsidiary in the
ordinary course in an aggregate principal amount not to exceed $1.0 million at
any one time outstanding; (xiii) any Investment constituting Permitted Junior
Securities of a person issued in exchange for trade or other claims against such
person in connection with a financial reorganization or restructuring of such
person or as a result of a foreclosure by the Company or any Restricted
Subsidiary with respect to any secured Investment or any other transfer of title
with respect to any secured Investment in default; (xiv) Investments made
pursuant to this clause (xiv) at any time, and from time to time, after the
Issue Date, in one or more contract manufacturers, suppliers, vendors and
distributors that are Affiliates of the Company in connection with the provision
by any such person of manufacturing, research and development, outsourcing,
sales, marketing and/or distribution services to the Company and/or one or more
Restricted Subsidiaries in an aggregate amount at one time outstanding not to
exceed $10.0 million; and (xv) other Investments made pursuant to this clause
(xv) at any time, and from time to time, after the Issue Date, in any person for
a purpose which is reasonably related, ancillary or complementary to the
businesses of the Company and the Restricted Subsidiaries on the date such
investment is made, in an aggregate amount at any one time outstanding not to
exceed $10.0 million.
"Restricted Payments" see Section 4.06.
-------------------
"Restricted Period" means the period of 40 days commencing on the day
-----------------
after the latest of (a) the day on which the Securities are first offered to
persons other than distributors (as defined in Regulation S) in reliance on
Regulation S and (b) the Issue Date.
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
-------------------
under the Securities Act; provided, that the Trustee shall be entitled to
request and conclusively rely upon an Opinion of Counsel with respect to whether
any Security is a Restricted Security.
"Restricted Subsidiary" means any direct or indirect Subsidiary of the
---------------------
Company that is not an Unrestricted Subsidiary.
"Restructuring Charges" means any charges or expenses in respect of
---------------------
restructuring or consolidating any business, operations or facilities, any
compensation or headcount reduction, or any other cost savings, of any persons
or businesses either alone or together with the Company or any Restricted
Subsidiary, as permitted by GAAP or Regulation S-X under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
---------
"Securities" means, collectively, the Series A Securities, the Series
----------
B Securities and the Subsequent Series Securities, which should be treated as a
single class of securities, as amended or supplemented from time to time in
accordance with the terms of this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
--------------
rules and regulations promulgated by the Commission thereunder.
"S&P" means Standard & Poor's Ratings Group.
---
-16-
"Senior Indebtedness" means, with respect to any person, (i) all
-------------------
Indebtedness of such person outstanding under the New Credit Facility and all
Hedging Obligations with respect thereto, (ii) any other Indebtedness of such
person permitted to be issued under the Indenture, provided, however, that
Senior Indebtedness shall not include any Indebtedness which by the terms of the
instrument creating or evidencing the same is subordinated or junior in right of
payment in any respect to any other Indebtedness of such person or its
Subsidiaries or Affiliates and (iii) all Obligations with respect to the
foregoing, in each case, whether outstanding on the Issue Date or thereafter
issued. Notwithstanding anything to the contrary in the foregoing, Senior
Indebtedness will not include (w) any liability for Federal, state, local,
foreign or other taxes, (x) any Indebtedness of any such person to any of its
Subsidiaries or other Affiliates (other than Indebtedness arising under the New
Credit Facility), (y) any trade payables or liability to trade creditors arising
in the ordinary course of business (including guarantees thereof or instruments
evidencing such liabilities) or (z) any Indebtedness that is incurred in
violation of the Indenture.
"Series A Securities" means the 10 3/8% Senior Subordinated Notes due
-------------------
2007 of the Company issued pursuant to this Indenture and sold pursuant to the
Purchase Agreement.
"Series B Securities" means the 10 3/8% Senior Subordinated Notes due
-------------------
2007 of the Company to be issued in exchange for the Series A Securities
pursuant to the Registered Exchange Offer and the Registration Rights Agreement.
"SFAS 106" means Statement of Financial Accounting Standards
--------
No. 106.
"SFAS 109" means Statement of Financial Accounting Standards
--------
No. 109.
"Significant Subsidiary" means any Restricted Subsidiary of the
----------------------
Company that would be a "significant subsidiary" as defined in clause (2) of the
definition of such term in Rule 1-02 of Regulation S-X under the Securities Act.
"Subordinated Indebtedness" means all Obligations with respect to
-------------------------
Indebtedness if the instrument creating or evidencing the same, or pursuant to
which the same is outstanding, designates such Obligations as subordinated or
junior in right of payment to Senior Indebtedness and to the Securities.
"Subsequent Series Securities" see Section 2.02.
----------------------------
"Subsidiary" of any person means any entity of which the Equity
----------
Interests entitled to cast at least a majority of the votes that may be cast by
all Equity Interests having ordinary voting power for the election of directors
or other governing body of such entity are owned by such person (regardless of
whether such Entity Interests are owned directly by such person or through one
or more Subsidiaries).
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
---
77aaa-77bbbb), as amended, as in effect on the date of this Indenture, except as
provided in Section 10.03.
"Trust Officer" means any officer within the corporate trust
-------------
department (or any successor group) of the Trustee including any vice president,
assistant vice president, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such trust matter is referred because of his knowledge of and familiarity
with the particular subject.
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"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 such successor.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
-----------------------
which at the time of determination shall be an Unrestricted Subsidiary (as
designated by the Board of Directors as provided below) and (ii) any subsidiary
of an Unrestricted Subsidiary. The Board of Directors may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary or a Person becoming a Subsidiary through merger or consolidation or
Investment therein) to be an Unrestricted Subsidiary only if: (a) such
Subsidiary does not own any Capital Stock of, or own or hold any Lien on any
property of, any other Subsidiary of the Company which is not a Subsidiary of
the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary; (b)
all the Indebtedness of such Subsidiary shall at the date of designation, and
will at all times thereafter consist of, Non-Recourse Debt; (c) the Company
certifies that such designation complies with Section 4.06; (d) such Subsidiary,
either alone or in the aggregate with all other Unrestricted Subsidiaries, does
not operate, directly or indirectly, all or substantially all of the business of
the Company and its Subsidiaries; (e) such Subsidiary does not directly or
indirectly, own any Indebtedness of or Equity Interest in, and has no
Investments in, the Company or any Restricted Subsidiary; (f) such Subsidiary is
a Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (1) to subscribe for
additional Equity Interests or (2) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results; and (g) on the date such Subsidiary is designated an
Unrestricted Subsidiary, such Subsidiary is not a party to any agreement,
contract, arrangement or understanding with the Company or any Restricted
Subsidiary with terms substantially less favorable to the Company than those
that might have been obtained from Persons who are not Affiliates of the
Company. Any such designation by the Board of Directors shall be evidenced to
the Trustee by filing with the Trustee a resolution of the Board of Directors
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing conditions. If, at any time, any
Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of the Indenture and any Indebtedness of such Subsidiary
shall be deemed to be incurred as of such date. The Board of Directors may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided,
that immediately after giving effect to such designation, no Default or Event of
Default shall have occurred and be continuing or would occur as a consequence
thereof and the Company could incur the Indebtedness of such Subsidiary pursuant
to Section 4.04 on a Pro Forma Basis taking into account such designation.
"U.S. Global Security" see Section 2.01.
--------------------
"U.S. Government Obligations" means direct non-callable obligations of
---------------------------
the United States of America for the payment of which the full faith and credit
of the United States is pledged.
"Voting Stock" means any class or classes of Capital Stock of any
------------
person pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect the board of directors (or persons performing
similar functions) of such person.
"Weighted Average Life to Maturity" means, when applied to any
---------------------------------
Indebtedness at any date, the number of years obtained by dividing (i) the then
outstanding principal amount of such Indebtedness into (ii) the sum of the
product(s) obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other requirement payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
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"Wholly Owned Restricted Subsidiary" means a Restricted Subsidiary all
----------------------------------
of the Equity Interests of which (other than Equity Interests constituting
directors' qualifying shares or shares required to be held by foreign nations,
in each case to the extent mandated by applicable law) is owned by the Company
or one or more Wholly Owned Restricted Subsidiaries or by the Company and one or
more Wholly Owned Restricted Subsidiaries.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities.
"indenture security holder" means 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 or 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 Commission rule
and not otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. 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 generally accepted accounting principles
in effect from time to time, and any other reference in this Indenture to
"generally accepted accounting principles" refers to GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions; and
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision.
-19-
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificate of authentication with
respect thereto shall be substantially in the form of Exhibit A or Exhibit B
hereto, as the case may be. The Securities may have notations, legends or
endorsements (including notations relating to the Guarantees) required by law,
stock exchange rule or usage. The Company and the Trustee shall approve the
form of the Securities and any notation, legend or endorsement (including
notations relating to the Guarantees) on them. Each Security shall be dated the
date of its authentication, shall bear interest from the applicable date which
shall be payable on each Interest Payment Date as long as such Security is
outstanding and shall be payable on the Maturity Date.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
Securities offered and sold in their initial distribution to Qualified
Institutional Buyers in reliance on Rule 144A or in offshore transactions in
reliance on Regulation S may, unless the applicable Holder requests Securities
in the form of physical, certificated Securities in registered form
("Certificated Securities"), which shall be substantially in the form of Exhibit
-------------------------
A, be initially issued in the form of Global Securities in fully registered form
without interest coupons, substantially in the form of Exhibit A, with such
applicable legends as are provided for in Exhibit A and Exhibit C.
Securities offered and sold in their initial distribution to Qualified
Institutional Buyers in reliance on Rule 144A shall be issued in the form of one
or more Global Securities (the "U.S. Global Security") which shall be registered
--------------------
in the name of the Depository or its nominee and deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and authenticated by
the Trustee as hereinafter provided, for credit by the Depository to the
respective accounts of beneficial owners of the Securities represented thereby
(or such other accounts as they may direct). The aggregate principal amount of
the U.S. Global Security may be increased or decreased from time to time by
adjustments made on the records of the Trustee, as custodian for the Depository,
in connection with a corresponding decrease or increase in the aggregate
principal amount of the Regulation S Global Security, as hereinafter provided in
Section 2.06.
Securities offered and sold in reliance on Regulation S shall
initially be in the form of Global Securities (the "Regulation S Global
-------------------
Security") which shall be registered in the name of the Depository or its
nominee and deposited with the Trustee, as custodian for the Depository, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided, for credit by the Depository to the respective accounts of the
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct), provided that upon such deposit all such Securities shall
be credited to or through accounts maintained at the Depository by or on behalf
of Euroclear or CEDEL. The aggregate principal amount of the Regulation S
Global Security may be increased or decreased from time to time by adjustments
made on the records of the Trustee, as custodian for the Depository, as
hereinafter provided in Section 2.06.
The Company shall cause the U.S. Global Security and the
Regulation S Global Security to have separate CUSIP numbers.
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SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall attest to, the Securities for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless. Each
execution of a Security by the Company shall be accompanied by the execution of
a Guarantee by each Guarantor (and by any Restricted Subsidiary that guarantees
Indebtedness of the Company pursuant to Section 4.20) as hereinafter provided in
Section 11.05.
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 aggregate principal amount of Securities issued under this
Indenture shall not exceed $150,000,000, of which $100,000,000 in aggregate
principal amount is being offered on the Issue Date and additional series of
notes (the "Subsequent Series Securities") in an aggregate principal amount not
----------------------------
to exceed $50,000,000 and in aggregate principal amounts of not less than
$25,000,000 per series may be issued subsequent to the Issue Date; provided that
such issuance complies with Section 4.04 and provided, further, that no Default
or Event of Default exists under this Indenture at the time of such issuance or
would result therefrom. The Trustee shall authenticate (i) Series A Securities
for original issue in the aggregate principal amount not to exceed $100,000,000,
(ii) Series B Securities from time to time only in exchange for a like principal
amount of Series A Securities, and (iii) subsequent to the Issue Date,
Subsequent Series Securities, in each case upon a written order of the Company
in the form of an Officers' Certificate. The Officers' Certificate shall
specify the amount of Securities to be authenticated, the series of Securities
and the date on which the Securities are to be authenticated. Upon receipt of a
written order of the Company in the form of an Officers' Certificate, the
Trustee shall authenticate Securities in substitution for Securities originally
issued to reflect any name change of the Company.
All Securities issued on the Issue Date and Subsequent Series
Securities shall be identical in all respects other than issue dates and the
date from which interest accrues and except as provided in this Section 2.02.
In the event that the Company shall issue and the Trustee shall
authenticate any Subsequent Series Securities, the Company shall use its best
efforts to obtain the same "CUSIP" number for such Securities as is printed on
the Securities outstanding at such time; provided, however, that if any series
of Securities issued under this Indenture subsequent to the Issue Date is
determined, pursuant to an Opinion of Counsel of the Company in a form
reasonably satisfactory to the Trustee to be a different class of security than
the Securities outstanding at such time for federal income tax purposes, the
Company may obtain a "CUSIP" number for such Securities that is different than
the "CUSIP" number printed on the Securities then outstanding. Notwithstanding
the foregoing, all Securities issued under this Indenture shall vote and consent
together on all matters as one class and no series of Securities will have the
right to vote or consent as a separate class on any matter.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee
-21-
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with the Company and Affiliates of the Company.
The 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 within the City of New
York where (a) Securities may be presented or surrendered for registration of
transfer or for exchange ("Registrar"), (b) Securities may be presented or
---------
surrendered for payment ("Paying Agent") and (c) notices and demands in respect
------------
of the Securities and this Indenture may be served. The Registrar shall keep a
register (the "Register") of the Securities and of their transfer and exchange.
--------
The Company, upon notice to the Trustee, may appoint one or more co-Registrars
and one or more additional Paying Agents. The term "Registrar" includes any co-
Registrar and the term "Paying Agent" includes any additional Paying Agent.
Except as provided herein, the Company, or any Subsidiary may act as Paying
Agent, Registrar or co-Registrar.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which shall incorporate the provisions of
the TIA. The agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall notify the Trustee of the name and
address of any such Agent. If the Company fails to maintain a Registrar or
Paying Agent, or fails to give the foregoing notice, the Trustee shall act as
such and shall be entitled to appropriate compensation in accordance with
Section 7.07.
The Company initially appoints the Trustee as Registrar and Paying
Agent until such time as the Trustee has resigned or a successor has been
appointed.
The Trustee is authorized to enter into a letter of representations
with the Depository in the form provided to the Trustee by the Company and to
act in accordance with such letter.
SECTION 2.04. Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of or premium, if any, or interest or Liquidated Damages, if any, on
the Securities, and shall notify the Trustee of any Default by the Company in
making any such payment. The Company at any time may require a Paying Agent to
distribute all assets held by it to the Trustee and account for any assets
disbursed and the Trustee may at any time during the continuance of any payment
Default, upon written request to a Paying Agent, require such Paying Agent to
distribute all assets held by it to the Trustee and to account for any assets
distributed. Upon distribution to the Trustee of all assets that shall have
been delivered by the Company to the Paying Agent (if other than the Company),
the Paying Agent shall have no further liability for such assets. If the
Company, any Subsidiary or any of their respective Affiliates acts as Paying
Agent, it shall, on or before each due date of the principal of or interest on
the Securities, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal or premium, if any, or,
interest or Liquidated Damages, if any, so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as herein provided and will
promptly notify the Trustee of its action or failure so to act.
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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
Holders and shall otherwise comply with TIA (S) 312(a). If the Trustee is not
the Registrar, the Company shall cause the Registrar to furnish to the Trustee
before each Interest Record Date and at such other times as the Trustee may
request in writing, a list as of such date and in such form as the Trustee may
reasonably require of the names and addresses of Holders, which list may be
conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to the provisions of Sections 2.15 and 2.16, when Securities
are presented to the Registrar or a co-Registrar with a request to register the
transfer of such Securities or to exchange such Securities for an equal
principal amount of Securities of other authorized denominations of the same
series, the Registrar or co-Registrar shall register the transfer or make the
exchange as requested if its requirements for such transaction are met;
provided, however, that the Securities surrendered for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Securities at the Registrar's or co-Registrar's
written request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith. The Registrar or co-Registrar shall not be required to register the
transfer or exchange of any Security (i) during a period beginning at the
opening of business 15 days before the mailing of a notice of redemption of
Securities and ending at the close of business on the day of such mailing and
(ii) selected for redemption in whole or in part pursuant to Article Three
hereof, except the unredeemed portion of any Security being redeemed in part.
Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any Agent of the Company shall treat the
person in whose name the Security is registered as the owner thereof for all
purposes whether or not the Security shall be overdue, and neither the Company,
the Trustee, nor any such Agent shall be affected by notice to the contrary.
Any Holder of a Global Security shall, by acceptance of such Global Security,
agree that transfers of beneficial interests in such Global Security may be
effected only through a book-entry system maintained by the Depository (or its
agent), and that ownership of a beneficial interest in a Global Security shall
be required to be reflected in a book entry.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or the Company
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 Company's and the Trustee's requirements for
replacement of Securities are met. Such Holder must provide an indemnity bond
or other indemnity, sufficient in the judgment of both the Company and the
Trustee, to protect the Company, the Trustee and any Agent from any loss which
any of them may suffer if a Security is replaced and evidence to their
satisfaction of the apparent loss, destruction or theft of such Security. The
Company may charge such Holder for its reasonable out-of-pocket expenses in
replacing a Security, including reasonable fees and expenses of counsel.
Every replacement Security is an additional obligation of the
Company.
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SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those canceled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Security in
accordance with the provisions hereof and those described in this Section 2.08
as not outstanding. Subject to Section 2.09, a Security does not cease to be
outstanding because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If on a Redemption Date or the Final Maturity Date the Paying Agent
holds money sufficient to pay all of the principal and interest due on the
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, the Guarantors or any of their respective Affiliates shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that a Trust Officer of the Trustee actually knows are so owned shall
be disregarded.
The Trustee may require an Officers' Certificate listing Securities
owned by the Company, the Guarantors or, to the knowledge of the Officers
signing such Officers' Certificate, their respective Affiliates.
SECTION 2.10. 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 upon receipt of a Company Order pursuant to Section 2.02 definitive
Securities in exchange for temporary Securities.
SECTION 2.11. 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 transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent,
and no one else, shall cancel all Securities surrendered for transfer, exchange,
payment or cancellation and deliver to the Company such canceled Securities for
disposal. Subject to Section 2.07, the Company may not issue new Securities to
replace Securities that it has paid or delivered to the Trustee for
cancellation. If the Company or the Guarantor shall acquire any of the
Securities, such acquisition shall not operate as a redemption or satisfaction
of the Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11.
-24-
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of principal of or interest on
the Securities, it shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the rate per annum borne by the Securities, to the
extent lawful.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities will use a "CUSIP" number, and
the Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Securities and that reliance may be placed only
on the other identification numbers printed on the Securities. The Company
shall promptly notify the Trustee of any changes in CUSIP numbers.
SECTION 2.14. Deposit of Moneys.
Prior to 10:00 a.m. New York City time on each Interest Payment Date,
Redemption Date and the Final Maturity Date, the Company shall deposit with the
Paying Agent in immediately available funds money sufficient to make cash
payments, if any, due on such Interest Payment Date, Redemption Date or Final
Maturity Date, as the case may be, in a timely manner which permits the Paying
Agent to remit payment to the Holders on such Interest Payment Date, Redemption
Date or Final Maturity Date, as the case may be.
SECTION 2.15. Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be registered in the
name of the Depository or the nominee of such Depository, (ii) be delivered to
the Trustee as custodian for such Depository and (iii) bear legends as set forth
in Exhibit C hereto.
---------
Members of, or participants in, the Depository ("Participants") shall
------------
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository, or the Trustee as its custodian, or under such
Global Security, and the Depository may be treated by the Company, the Trustee
and any agent of the Company or the Trustee as the absolute owner of such Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the Depository
and Participants, the operation of customary practices governing the exercise of
the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in the Global Securities may be
transferred or exchanged for Certificated Securities in accordance with the
rules and procedures of the Depository and the provisions of Section 2.16. In
addition, Certificated Securities shall be transferred to all beneficial owners
in exchange for their beneficial interests in Global Securities if (i) the
Depository (x) notifies the Company that it is unwilling or unable to continue
as Depository for any Global Security and a successor Depository is not
appointed by the Company within 90 days of such notice or (y) has ceased to be a
clearing agency registered under the Exchange Act, (ii) the Company, at its
option, notifies the Trustee in writing that it elects to cause the issuance of
Certificated Notes or (iii) an Event of Default has occurred and is continuing
and the Registrar has received a request from the Depository to issue
Certificated Securities.
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(c) In connection with the transfer of Global Securities as an
entirety to beneficial owners pursuant to paragraph (b) of this Section 2.15,
the Global Securities shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall upon written
instructions from the Company authenticate and make available for delivery, to
each beneficial owner identified by the Depository in exchange for its
beneficial interest in the Global Securities, an equal aggregate principal
amount of Certificated Securities of authorized denominations.
(d) Any Certificated Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to paragraph
(b) of this Section 2.15 shall, except as otherwise provided by Section 2.16,
bear the Private Placement Legend.
(e) The Holder of any Global Security may grant proxies and otherwise
authorize any Person, including Participants and Persons that may hold interests
through Participants, to take any action which a Holder is entitled to take
under this Indenture or the Securities.
SECTION 2.16. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Certificated Securities. When
Certificated Securities are presented to the Registrar or co-Registrar with a
request:
(i) to register the transfer of the Certificated Securities; or
(ii) to exchange such Certificated Securities for an equal number
of Certificated Securities of other authorized denominations,
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if the requirements under this Indenture as set forth in this
Section 2.16 for such transactions are met; provided, however, that the
Certificated Securities presented or surrendered for registration of transfer or
exchange:
(I) shall be duly endorsed or accompanied by a written instrument
of transfer in form satisfactory to the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing;
and
(II) in the case of Certificated Securities the offer and sale of
which have not been registered under the Securities Act, such Certificated
Securities shall be accompanied, in the sole discretion of the Company, by
the following additional information and documents, as applicable:
(A) if such Certificated Security is being delivered to the Registrar
or co-Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to
that effect (substantially in the form of Exhibit D hereto); or
---------
(B) if such Certificated Security is being transferred to a Qualified
Institutional Buyer in accordance with Rule 144A, a certification
to that effect (substantially in the form of Exhibit D hereto);
---------
or
(C) if such Certificated Security is being transferred in reliance on
Regulation S, delivery of a certification to that effect
(substantially in the form of Exhibit D hereto) and a transferor
---------
certificate for Regulation S transfers substantially in the form
of Exhibit E
---------
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hereto and an Opinion of Counsel reasonably satisfactory to the
Company to the effect that such transfer is in compliance with
the Securities Act; or
(D) if such Certificated Security is being transferred in reliance on
Rule 144 under the Securities Act, delivery of a certification to
that effect (substantially in the form of Exhibit D hereto) and
------- -
an Opinion of Counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act; or
(E) if such Certificated Security is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification to that effect (substantially in
the form of Exhibit D hereto) and an opinion of counsel
---------
reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act.
(b) Restrictions on Transfer of a Certificated Security for a
Beneficial Interest in a Global Security. A Certificated Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
or co-Registrar of a Certificated Security, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the Registrar or
co-Registrar, together with:
(A) in the case of Certificated Securities, the offer and sale of
which have not been registered under the Securities Act,
certification, substantially in the form of Exhibit D hereto,
---------
that such Certificated Security is being transferred (I) to a
Qualified Institutional Buyer or (II) in an offshore transaction
in reliance on Regulation S; and
(B) written instructions from the Holder thereof directing the
Registrar or co-Registrar to make, or to direct the Depository to
make, an endorsement on the applicable Global Security to reflect
an increase in the aggregate amount of the Securities represented
by the Global Security,
then the Registrar or co-Registrar shall cancel such Certificated Security and
cause, or direct the Depository to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Registrar or
co-Registrar, the principal amount of Securities represented by the applicable
Global Security to be increased accordingly. If no Global Security representing
Securities held by Qualified Institutional Buyers or Persons acquiring
Securities in offshore transactions in reliance on Regulation S, as the case may
be, is then outstanding, the Company shall issue and the Trustee shall, upon
receipt of an authentication order in the form of an Officers' Certificate in
accordance with Section 2.02, authenticate such a Global Security in the
appropriate principal amount.
(c) Transfer and Exchange of Global Securities. The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the Depository in accordance with this Indenture (including the
restrictions on transfer set forth herein) and the procedures of the Depository
therefor. Upon receipt by the Registrar or co-Registrar of written
instructions, or such other instruction as is customary for the Depository, from
the Depository or its nominee, requesting the registration of transfer of an
interest in a U.S. Global Security or Regulation S Global Security, as the case
may be, to another type of Global Security, together with the applicable Global
Securities (or, if the applicable type of Global Security required to represent
the interest as requested to be transferred is not then outstanding, only the
Global Security representing the interest being transferred), the Registrar or
Co-Registrar shall cancel such Global Securities (or Global Security) and the
Company
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shall issue and the Trustee shall, upon receipt of an authentication order in
the form of an Officers' Certificate in accordance with Section 2.02,
authenticate new Global Securities of the types so cancelled (or the type so
cancelled and applicable type required to represent the interest as requested to
be transferred) reflecting the applicable increase and decrease of the principal
amount of Securities represented by such types of Global Securities, giving
effect to such transfer. If the applicable type of Global Security required to
represent the interest as requested to be transferred is not outstanding at the
time of such request, the Company shall issue and the Trustee shall, upon
written instructions from the Company in accordance with Section 2.02,
authenticate a new Global Security of such type in principal amount equal to the
principal amount of the interest requested to be transferred.
(d) Transfer of a Beneficial Interest in a Global Security for a
Certificated Security.
(i) Any Person having a beneficial interest in a Global Security
may upon request exchange such beneficial interest for a Certificated
Security. Upon receipt by the Registrar or co-Registrar of written
instructions, or such other form of instructions as is customary for the
Depository, from the Depository or its nominee on behalf of any Person
having a beneficial interest in a Global Security and upon receipt by the
Trustee of a written order or such other form of instructions as is
customary for the Depository or the Person designated by the Depository as
having such a beneficial interest containing registration instructions and,
in the case of any such transfer or exchange of a beneficial interest in
Securities the offer and sale of which have not been registered under the
Securities Act, the following additional information and documents:
(A) if such beneficial interest is being transferred to the Person
designated by the Depository as being the beneficial owner, a
certification from such Person to that effect (substantially in
the form of Exhibit D hereto); or
---------
(B) if such beneficial interest is being transferred to a Qualified
Institutional Buyer in accordance with Rule l44A, a certification
to that effect (substantially in the form of Exhibit D hereto);
---------
or
(C) if such beneficial interest is being transferred in reliance on
Regulation S, delivery of a certification to that effect
(substantially in the form of Exhibit D hereto) and a transferor
---------
certificate for Regulation S transfers substantially in the form
of Exhibit E hereto and an Opinion of Counsel reasonably
---------
satisfactory to the Company to the effect that such transfer is
in compliance with the Securities Act; or
(D) if such beneficial interest is being transferred in reliance on
Rule 144 under the Securities Act, delivery of a certification to
that effect (substantially in the form of Exhibit D hereto) and
---------
an Opinion of Counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act; or
(E) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification to that effect (substantially in
the form of Exhibit D hereto) and an opinion of counsel
---------
reasonably satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act,
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then the Registrar or co-Registrar will cause, in accordance with the
standing instructions and procedures existing between the Depository and
the Registrar or co-Registrar, the aggregate principal amount of the
applicable Global Security to be reduced and, following such reduction, the
Company will execute and, upon receipt of an authentication order in the
form of an Officers' Certificate in accordance with Section 2.02, the
Trustee will authenticate and deliver to the transferee a Certificated
Security in the appropriate principal amount.
(ii) Certificated Securities issued in exchange for a beneficial
interest in a Global Security pursuant to this Section 2.16(d) shall be
registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Registrar or co-Registrar in
writing. The Registrar or co-Registrar shall deliver such Certificated
Securities to the Persons in whose names such Certificated Securities are
so registered.
(e) Restrictions on Transfer and Exchange of Global Securities.
Notwithstanding any other provisions of this Indenture, a Global Security may
not be transferred as a whole except by the Depository to a nominee of the
Depository or by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar or co-Registrar shall deliver Securities that do not bear the Private
Placement Legend. Upon the transfer, exchange or replacement of Securities
bearing the Private Placement Legend, the Registrar or co-Registrar shall
deliver only Securities that bear the Private Placement Legend unless, and the
Trustee is hereby authorized to deliver Securities without the Private Placement
Legend if, (i) there is delivered to the Trustee an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act or (ii)
such Security has been sold pursuant to an effective registration statement
under the Securities Act.
(g) General. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Participants or
beneficial owners of interest in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16.
The Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
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ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant to paragraph 6 or
7 of the Securities at the applicable redemption price set forth therein, it
shall notify the Trustee in writing of the Redemption Date and the principal
amount of Securities to be redeemed. The Company shall give such notice to the
Trustee at least 45 days before the Redemption Date (unless a shorter notice
shall be agreed to by the Trustee in writing), together with an Officers'
Certificate stating that such redemption will comply with the conditions
contained herein. Any such notice to the Trustee may be cancelled at any time
up to two Business Days prior to the notice of such redemption being mailed to
any Holder and shall thereby be void and of no effect.
SECTION 3.02. Selection of Securities to Be Redeemed.
If less than all of the Securities are to be redeemed pursuant to
paragraph 6 of the Securities, the Trustee shall select the Securities to be
redeemed on a pro rata basis, by lot or by any other method as the Trustee shall
deem fair and appropriate and, if the Securities are listed on a national
securities exchange, by a method in compliance with the requirements of the
national securities exchange. Selection of the Securities to be redeemed
pursuant to paragraph 7 of the Securities shall be made by the Trustee only on a
pro rata basis or on as nearly a pro rata basis as is practicable (subject to
the procedures of the Depository) based on the aggregate principal amount of
Securities held by each Holder. The Trustee shall make the selection from the
Securities then outstanding, subject to redemption and not previously called for
redemption.
The Trustee may select for redemption pursuant to paragraph 6 or 7 of
the Securities portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof. The Trustee shall promptly notify the
Company in writing of the Securities selected for redemption and, in the case of
any Security selected for partial redemption, the portion of the principal
amount thereof to be redeemed. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail to each Holder
at such Holder's registered address whose Securities are to be redeemed pursuant
to paragraph 6 or 7 of the Securities.
Each notice of redemption shall identify the Securities to be redeemed
(including, but subject to the provisions of Section 2.13, the CUSIP number
thereon) and shall state:
(i) the paragraph of the Securities pursuant to which the Securities
are to be redeemed;
(ii) the Redemption Date and redemption price;
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(iii) the name and address of the Paying Agent to which the
Securities are to be surrendered for redemption;
(iv) that Securities called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(v) that, unless the Company defaults in making the redemption
payment, interest on Securities called for redemption ceases to accrue on
and after the Redemption Date and the only remaining right of the Holders
is to receive payment of the redemption price upon surrender to the Paying
Agent; and
(vi) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
Redemption Date, upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion thereof will
be issued.
At the Company's request, the Trustee shall give the notice of
redemption on behalf of the Company, in the Company's name and at the Company's
expense.
SECTION 3.04. Effect of Notice of Redemption.
Once a notice of redemption is mailed, Securities called for
redemption become due and payable on the Redemption Date and at the redemption
price specified in such notice. Upon surrender to the Paying Agent, such
Securities shall be paid at the redemption price, plus accrued interest thereon,
if any, to the Redemption Date, but interest installments whose maturity is on
or prior to such Redemption Date shall be payable to the Holders of record at
the close of business on the relevant Interest Record Date.
SECTION 3.05. Deposit of Redemption Price.
No later than 10:00 a.m. New York City time on the Redemption Date,
the Company shall deposit with the Paying Agent (or if the Company is its own
Paying Agent, shall, on or before the Redemption Date, segregate and hold in
trust) money sufficient to pay the redemption price of and accrued interest and
Liquidated Damages, if any, on all Securities to be redeemed on that date other
than Securities or portions thereof called for redemption on that date which
have been delivered by the Company to the Trustee for cancellation. The Paying
Agent shall promptly return to the Company any money deposited with the Trustee
or the Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued interest on, all Securities to be redeemed.
If any Security surrendered for redemption in the manner provided in
the Securities shall not be so paid on the Redemption Date due to the failure of
the Company to deposit with the Paying Agent money sufficient to pay the
redemption price thereof, the principal and accrued and unpaid interest, if any,
thereon shall, until paid or duly provided for, bear interest as provided in
Sections 2.12 and 4.01 with respect to any payment default.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Company
shall issue and, upon the Company's written request, the Trustee shall
authenticate for the Holder a new Security equal in principal amount to the
unredeemed portion of the Security surrendered.
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and premium, if any, and
interest and Liquidated Damages, if any, on the Securities in the manner
provided in the Securities and the Registration Rights Agreement. An
installment of principal, premium, interest or Liquidated Damages shall be
considered paid on the date due if the Trustee or Paying Agent (other than the
Company, a Subsidiary or an Affiliate of the Company) holds on that date money
designated for and sufficient to pay the installment in full and is not
prohibited from paying such money to the Holders of the Securities pursuant to
the terms of this Indenture.
The Company shall pay interest on overdue principal at the same rate
per annum borne by the Securities. The Company shall pay interest on overdue
installments of interest at the same rate per annum borne by the Securities, to
the extent lawful, as provided in Section 2.12.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of
New York, the office or agency required under Section 2.03. The Company shall
give prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 13.02
hereof. The Company hereby initially designates the Trustee at its address set
forth in Section 13.02 as its office or agency in the Borough of Manhattan, The
City of New York, for such purposes.
SECTION 4.03. Limitation on Transactions with Affiliates.
(a) The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, enter into any transaction
with an Affiliate, including, without limitation, any loan, advance, guarantee
or capital contribution to, or for the benefit of, or sell, lease, transfer or
dispose of any properties or assets to, or for the benefit of, or purchase or
lease any property or assets from, or enter into or amend any contract,
agreement or understanding with, or for the benefit of, an Affiliate (each such
transaction or series of related transactions with such Affiliate that are part
of a common plan are referred to as an "Affiliate Transaction"), except in good
---------------------
faith and on terms that are determined by the Board of Directors, or, if
applicable, a committee comprising the Independent Directors of the Board of
Directors, and, in the case of any Affiliate Transaction involving aggregate
payments or other transfers by the Company and/or its Restricted Subsidiaries in
excess of $1.0 million (including cash and non-cash payments and benefits valued
at their fair market value by the Board of Directors in good faith), set forth
in a resolution adopted by such committee, to be no less favorable to the
Company or the relevant Restricted Subsidiary than those that would have been
obtained in a comparable transaction on an arm's length basis from an unrelated
person.
(b) The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any Affiliate Transaction involving aggregate payments
or other transfers by the Company and/or its Restricted Subsidiaries in excess
of $7,500,000 (including cash and non-cash payments and benefits valued at their
fair market value by the Board of Directors in good faith) unless the Company
delivers to the Trustee:
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(i) a resolution of the Board of Directors, or, if applicable, a
committee comprising the Independent Directors of the Board of Directors,
stating that a majority of such directors has, in good faith, determined
such Affiliate Transaction to be no less favorable to the Company or the
relevant Restricted Subsidiary than those that would have been obtained in
a comparable transaction on an arm's length basis from an unrelated person
and otherwise complies with the provisions of this Indenture; and
(ii) (A) with respect to any Affiliate Transaction involving the
incurrence of Indebtedness, a written opinion of a nationally recognized
investment banking or accounting firm experienced in the review of similar
types of transactions, (B) with respect to any Affiliate Transaction
involving the transfer of real property, fixed assets or equipment, either
directly or by a transfer of 50% or more of the Capital Stock of a
Restricted Subsidiary which holds any such real property, fixed assets or
equipment, a written appraisal from a nationally recognized appraiser,
experienced in the review of similar types of transactions or (C) with
respect to any Affiliate Transaction not otherwise described in (A) and (B)
above, a written certification from a nationally recognized professional or
firm experienced in evaluating similar types of transactions, in each case,
stating that the terms of such transaction are fair to the Company or such
Restricted Subsidiary, as the case may be, from a financial point of view.
(c) Notwithstanding paragraphs (a) and (b) of this Section
4.03, this Section 4.03 shall not apply to:
(i) transactions between or among the Company and any Restricted
Subsidiaries;
(ii) transactions permitted by Section 4.06;
(iii) fees and reasonable compensation paid to, and indemnity
provided on behalf of, directors, officers or employees of the Company or
any Subsidiary as determined in good faith by the Board of Directors;
(iv) any issuance, award or grant of securities or payment in cash
or otherwise made as compensation for services rendered pursuant to the
terms of any Incentive Arrangement, as determined in good faith by the
Board of Directors;
(v) loans or advances to employees or directors of the Company or
any Restricted Subsidiary in the ordinary course and in an aggregate amount
not to exceed $1,000,000 at any one time outstanding; or
(vi) any transaction pursuant to an Existing Affiliate Agreement,
including any amendments thereto entered into after the Issue Date,
provided that the terms of any such amendment are not less favorable to the
Company than the terms of the relevant agreement in effect prior to any
such amendment as determined in good faith by the Board of Directors. As
used in this clause (vi), "Existing Affiliate Agreement" means the
----------------------------
Morningside Management Agreement, the Xxxxxx-AM Management Agreement, the
AM Cosmetics Broker Agreement, the AM Manufacturing Agreement, the
Distribution Agreement and the License Agreement.
(d) Notwithstanding paragraphs (a), (b) and (c) of this Section 4.03,
any Affiliate Transaction between the Company and an Affiliate of the Company
relating to the provision to the Company or a Restricted Subsidiary of research
and development, manufacturing, sales and/or distribution services in the
ordinary course of business shall not be subject to clause (ii) of paragraph (b)
of this Section 4.03.
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SECTION 4.04. Limitation on Incurrence of Indebtedness.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, issue any Indebtedness (other than the Indebtedness represented
by the Securities and the Guarantees), except that the Company and any
Restricted Subsidiaries may issue additional Indebtedness if the Company's Cash
Flow Coverage Ratio for its four full fiscal quarters next preceding the date
such additional Indebtedness is issued would have been at least 2.00 to 1 on or
prior to the second anniversary of the Issue Date and 2.25 to 1 thereafter
determined on a Pro Forma Basis ([increasing ratio over time?](including, for
this purpose, any other Indebtedness issued and any acquisition or sale
consummated, since the end of the applicable four-quarter period) as if such
additional Indebtedness and any other Indebtedness issued since the end of such
four-quarter period had been issued at the beginning of such four-quarter
period.
(b) The foregoing limitations shall not apply to the issuance
of:
(i) Indebtedness of the Company and the Restricted Subsidiaries
under the New Credit Facility in an aggregate principal
amount at any one time outstanding not to exceed the greater of (x)
$75,000,000 or (y) the sum of (i) 85% of the book value of the accounts
receivable of the Company and the Restricted Subsidiaries taken as a whole
and (ii) 50% of the book value of the inventory of the Company and the
Restricted Subsidiaries taken as a whole;
(ii) Indebtedness of Foreign Subsidiaries, including Xxxxxx South
Africa, in an aggregate principal amount at any one time outstanding not to
exceed the greater of (x) $10,000,000 or (y) an aggregate amount equal to
the sum of, with respect to each Foreign Subsidiary, (A) 85% of the book
value of the accounts receivable of such Foreign Subsidiary and (B) 50% of
the book value of the inventory of such Foreign Subsidiary; provided, that
such indebtedness is issued for working capital purposes;
(iii) Indebtedness of the Company and its Restricted Subsidiaries
issued in connection with capital leases, sale and leaseback transactions,
purchase money obligations or similar financing transactions relating to
its properties, assets and rights as of the date of original issuance of
the Securities up to $10,000,000 in aggregate principal amount at any one
time outstanding;
(iv) additional Indebtedness of the Company and the Restricted
Subsidiaries in an aggregate principal amount up to $ [(all or
any portion of which may be issued as additional Indebtedness under the
Credit Agreement); provided that the aggregate principal amount of
Indebtedness outstanding under this clause (iii) together with the
aggregate principal amount of Indebtedness outstanding under clause (i)
above shall not exceed $ in aggregate principal amount at any
one time outstanding;]of up to $10,000,000 at any one time
outstanding; and
(v) Other Permitted Indebtedness.
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.04, no
Restricted Subsidiary shall under any circumstances issue a guarantee of any
Indebtedness of the Company except for guarantees issued by Restricted
Subsidiaries pursuant to Section 4.20; provided, however, that the foregoing
will not limit or restrict guarantees issued by Guarantors in respect of
Indebtedness of other Guarantors or of the Company.
For purposes of determining compliance with this Section 4.04, in the
event that an item of Indebtedness meets the criteria of more than one of the
types of Indebtedness which the Company and any Restricted Subsidiary are
permitted to issue, the Company and such Restricted Subsidiary, as the case may
be, will have the right, in the Company's sole discretion, to classify such item
of Indebtedness at the time of its issuance and will only be required to include
the amount and type of such Indebtedness under the clause permitting the
Indebtedness as so classified. Neither the accrual of interest nor the issuance
of additional Indebtedness in the
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form of additional promissory notes or otherwise in lieu of the payment of
interest nor the accretion of accreted value will be deemed to be an issuance of
Indebtedness for purposes of this Section 4.04.
SECTION 4.05. Limitation on Asset Sales.
(a) The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale
(including the sale of any of the Capital Stock of any Restricted Subsidiary but
excluding the sale of any interests in Unrestricted Subsidiaries) providing for
Net Proceeds in excess of $1,000,000 unless the Net Proceeds from such Asset
Sale are applied (in any manner otherwise permitted by this Indenture) to one or
more of the following purposes in such combination as the Company or the
applicable Restricted Subsidiary, as the case may be, shall elect: (i) an
investment in another asset or business in the same line of business as, or a
line of business similar, ancillary, complementary or reasonably related to that
of, a line of business or businesses of the Company and its Restricted
Subsidiaries at the time of the Asset Sale; provided that such investment occurs
on or prior to the 270th day following the date of such Asset Sale (the "Asset
-----
Sale Disposition Date"), (ii) the reimbursement of the Company or its Restricted
---------------------
Subsidiaries for expenditures made, and costs incurred, to repair, rebuild,
replace or restore property subject to loss, damage or taking to the extent that
the Net Proceeds consist of insurance proceeds received on account of such loss,
damage or taking, (iii) the purchase, redemption or other prepayment or
repayment of outstanding Senior Indebtedness of the Company or its
Restricted Subsidiaries on or prior to the 270th day following the Asset
Sale Disposition Date and permanent reduction of the amount of such
Indebtedness, or (iv) the cash collateralization of letters of credit or bankers
acceptances designed to facilitate the purchase of goods and services provided
that any cash collateral released to the Company or its Restricted Subsidiaries
upon the expiration of such letters of credit, bankers acceptances or other
instruments or arrangements shall again be deemed to be Net Proceeds received on
the date of such release. The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale
unless at least 75% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of cash, cash equivalents or Marketable
Securities; provided that, solely for purposes of calculating such 75% of the
consideration, the amount of (x) any liabilities (as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet or in the notes thereto,
excluding contingent liabilities and trade payables) of the Company or any
Restricted Subsidiary (other than liabilities that are by their terms
subordinated to the Securities) that are assumed by the transferee of any such
assets and (y) any notes or other obligations received by the Company or any
such Restricted Subsidiary from such transferee that are promptly, but in no
event more than 45 days after receipt, converted by the Company or such
Restricted Subsidiary into cash (to the extent of the cash received), shall be
deemed to be cash and cash equivalents for purposes of this provision. Any Net
Proceeds from any Asset Sale that are not applied or invested as provided in the
first sentence of this paragraph shall constitute "Excess Proceeds."
---------------
(b) When the aggregate amount of Excess Proceeds (net of Foreign
Proceeds, as defined below) exceeds $10,000,000 (such date being an "Asset Sale
----------
Trigger Date"), the Company shall make an Offer to purchase on a pro rata basis
------------
the maximum principal amount of the Securities and pari passu Indebtedness of
the Company or any Restricted Subsidiary, if any, that requires, pursuant to its
terms, such an offer, then outstanding that may be purchased out of Excess
Proceeds (an "Asset Sale Offer"), at an offer price in cash in an amount equal
----------------
to 100% of the principal amount thereof plus any accrued and unpaid interest to
the date the Securities tendered are purchased and paid for in accordance with
this Section 4.05 (the "Asset Sale Purchase Date"). Notwithstanding the
------------------------
foregoing, to the extent that any or all of the Net Proceeds of an Asset Sale is
prohibited or delayed by applicable local law from being repatriated to the
United States or such repatriation would be expected to result in material tax
liability to the Company or any Restricted Subsidiary, as determined in good
faith by the Board of Directors (such Net Proceeds, the "Foreign Proceeds"), the
----------------
Company shall not be required to make an Asset Sale Offer with respect to such
proceeds. Foreign Proceeds shall be applied, in such combination
-35-
as the Company shall select, in accordance with clause (i), (ii), (iii) or (iv)
of paragraph (a) of this Section 4.05, or, at the option of the Company, may be
retained as cash or Marketable Securities for so long, but only for so long, as
the applicable local law prohibits or delays repatriation to the United States
or would result in material tax liability as described above. Within 30 days
following any Asset Sale Trigger Date, the Company shall mail a notice to each
holder of Securities at such holder's registered address stating:
(i) that an Asset Sale Offer is being made pursuant to this Section
4.05, the length of time the Asset Sale Offer shall remain open and the
maximum principal amount of Securities that will be accepted for payment
pursuant to such Asset Sale Offer;
(ii) the purchase price, the amount of accrued and unpaid interest
as of the Asset Sale Purchase Date and the Asset Sale Purchase Date (which
shall be no earlier than 30 days and no later than 60 days from the date
such notice is mailed);
(iii) that any Security or portion thereof not tendered or
accepted for payment will continue to accrue interest;
(iv) that any Security or portion thereof accepted for payment
pursuant to the Asset Sale Offer shall cease to accrue interest on and
after the Asset Sale Purchase Date;
(v) that Holders electing to have a Security purchased pursuant to
the Asset Sale Offer will be required to surrender the Security, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed, to a Paying Agent at the address specified in the
notice at least three Business Days before the Asset Sale Purchase Date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
third Business Day before the Asset Sale Purchase Date, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Security the Holder delivered for purchase and a statement
that such Holder is withdrawing his election to have the Security
purchased;
(vii) that, if the aggregate principal amount of Securities
surrendered by Holders exceeds the Excess Proceeds, the Trustee shall
select the Securities to be purchased on a pro rata basis, by lot or by any
other method that the Trustee considers fair and appropriate and, if the
Securities are listed on any securities exchange, by a method that complies
with the requirements of such exchange; provided that, if less than all of
a holder's Securities are to be redeemed or accepted for payment, only
principal amounts of $1,000 or integral multiples thereof may be selected
for redemption or accepted for payment;
(viii) that Holders whose Securities were purchased only in part
will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered; and
(ix) a brief description of the circumstances and relevant facts
regarding such Asset Sale.
On the Asset Sale Purchase Date, the Company shall, to the extent
required by this Indenture and the Asset Sale Offer, (1) accept for payment the
maximum principal amount of Securities or portions thereof tendered pursuant to
the Asset Sale Offer that can be purchased out of Excess Proceeds, (2) deposit
with the Paying Agent the aggregate purchase price of all Securities or portions
thereof accepted for payment and any
-36-
accrued and unpaid interest on such Securities as of the Asset Sale Purchase
Date, and (3) deliver or cause to be delivered to the Trustee all Securities
tendered pursuant to the Asset Sale Offer. The Paying Agent shall promptly mail
to each holder of Securities or portions thereof accepted for payment an amount
equal to the purchase price for such Securities plus any accrued and unpaid
interest thereon, and the Trustee shall promptly authenticate and mail (or cause
to be transferred by book-entry) to such holder of Securities accepted for
payment in part a new Security equal in principal amount to any unpurchased
portion of the Securities and any Security not accepted for payment in whole or
in part shall be promptly returned to the Holder thereof. The Company will
publicly announce the results of the Asset Sale Offer on or as soon as
practicable after the Asset Sale Purchase Date.
The Company shall comply with any tender offer rules under the
Exchange Act which may then be applicable, including Rule 14e-1, in connection
with an Asset Sale Offer. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Indenture, the Company
shall comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations under this Indenture by virtue
thereof.
(c) To the extent that any Excess Proceeds (other than Foreign
Proceeds) remain after completion of an Asset Sale Offer, the Company may use
such remaining amount for general corporate purposes including repayment of
Subordinated Indebtedness. Upon completion of an Asset Sale Offer, the amount
of Excess Proceeds shall be reset at zero plus the amount, if any, of cash or
Marketable Securities attributable to Foreign Proceeds.
SECTION 4.06. Limitation on Restricted Payments.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, (i) declare or pay any dividend or make any
distribution on account of the Company's or such Restricted Subsidiary's Capital
Stock or other Equity Interests (other than dividends or distributions payable
in Capital Stock or other Equity Interests (other than Disqualified Stock) of
the Company and/or any Restricted Subsidiary and dividends or distributions
payable by a Restricted Subsidiary to a Restricted Subsidiary or to the Company,
and if such Restricted Subsidiary has shareholders other than the Company or
other Restricted Subsidiaries, to the other shareholders of such Restricted
Subsidiary on a pro rata basis or on a basis that results in the receipt by the
Company or other Restricted Subsidiaries of dividends or distributions of equal
or greater value); (ii) purchase, redeem or otherwise acquire or retire for
value any Capital Stock or other Equity Interests of the Company or any of its
Restricted Subsidiaries held by persons other than the Company or any Restricted
Subsidiary of the Company; (iii) make any payment on or with respect to, or
purchase, redeem, defease or otherwise acquire or retire for value, any
Subordinated Indebtedness of the Company or any Subsidiaries, whether any such
Subordinated Indebtedness is outstanding on, or issued after, the Issue Date,
except a payment, purchase, redemption, defeasance or other acquisition 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;
(iv) make any payment under the Morningside Management Agreement or any
amendment thereto; or (v) make any Restricted Investment (all such dividends,
distributions, purchases, redemptions, acquisitions, retirements, prepayments
and Restricted Investments being collectively referred to as "Restricted
----------
Payments"), if, at the time of such Restricted Payment:
--------
(a) a Default or Event of Default shall have occurred and be
continuing or shall occur as a consequence thereof; or
-37-
(b) immediately after such Restricted Payment and after giving
effect thereto on a Pro Forma Basis, the Company shall not be able to issue
$1.00 of additional Indebtedness pursuant to paragraph (a) of Section 4.04;
or
(c) such Restricted Payment, together with the aggregate of all
other Restricted Payments made after the Issue Date, without duplication,
exceeds the sum of (1) 50% of the cumulative Consolidated Net Income
(including, for this purpose, gains or losses from Asset Sales and, to the
extent not included in Consolidated Net Income, any gain or loss from a
sale or disposition of a Restricted Investment) of the Company (or, in case
such cumulative Consolidated Net Income is a loss, 100% of such loss) for
the period (taken as one accounting period) from the beginning of the
fiscal quarter commencing October 1, 1997 and ended as of the Company's
most recently ended fiscal quarter at the time of such Restricted Payment;
plus (2) 100% of the aggregate net cash proceeds and the fair market value
of any property or securities (as determined by the Board of Directors in
good faith) received by the Company or any Wholly Owned Restricted
Subsidiary from the issue or sale of Capital Stock or other Equity
Interests of the Company or any Restricted Subsidiary subsequent to the
Issue Date (other than (x) Capital Stock or other Equity Interests issued
or sold to a Restricted Subsidiary and (y) the issuance or sale of
Disqualified Stock); plus (3) the amount by which the principal amount of
and any accrued interest on or the redemption or repurchase price in
respect thereof and accrued dividends on, as the case may be, either (A)
Indebtedness of the Company or (B) any Indebtedness of any Restricted
Subsidiary is reduced on the Company's consolidated balance sheet upon the
conversion or exchange, pursuant to the terms of such Indebtedness, other
than by a Restricted Subsidiary, subsequent to the Issue Date of any
Indebtedness of the Company or any Restricted Subsidiary (not held by the
Company or any Restricted Subsidiary) for Capital Stock or other Equity
Interests (other than Disqualified Stock) of the Company (less the amount
of any cash, or the fair market value of any other property or securities
(as determined by the Board of Directors in good faith), distributed by the
Company or any Restricted Subsidiary (to persons other than the Company or
any other Restricted Subsidiary) upon such scheduled conversion or
exchange); plus (4) to the extent that any Restricted Investment that was
made after the Issue Date is sold or otherwise liquidated or repaid or any
Unrestricted Subsidiary which is designated as an Unrestricted Subsidiary
after the Issue Date is sold or otherwise liquidated, the return of capital
with respect to such Restricted Investment (less the cost of disposition,
if any) up to such amount as does not exceed the original amount of such
Restricted Investment; plus (5) any dividends or distributions actually
received in cash by the Company or a Restricted Subsidiary after the Issue
Date from an Unrestricted Subsidiary, to the extent that such dividends or
distributions were not otherwise included in the Consolidated Net Income of
the Company for such period; plus (6) if any Unrestricted Subsidiary is
redesignated as a Restricted Subsidiary, the value of the Restricted
Payment that would result if such Subsidiary were redesignated as an
Unrestricted Subsidiary at such time, as determined in accordance with the
second and third sentences of paragraph (a) of Section 4.17; provided,
however, that for purposes of this clause (6), the value of any
redesignated Unrestricted Subsidiary shall be reduced by the amount that
any such redesignation replenishes or increases the amount of Restricted
Investments permitted to be made pursuant to clause (xv) of the definition
of "Restricted Investment"; plus (7) $5,000,000.
(d) Notwithstanding the foregoing, the Indenture clauses (b) and
(c) shall not prohibit as Restricted Payments:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration, such payment
would comply with all covenants of this Indenture (including, but not
limited to, this Section 4.06);
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(ii) the repurchase, redemption, retirement or acquisition of
Equity Interests of the Company or a Subsidiary from employees or
directors of the Company or a Subsidiary upon such employees' or
directors' death, retirement or termination of employment or otherwise
in accordance with any employment agreement, employee or director
stock option plan or agreement or employee or director equity
subscription agreement, in an aggregate amount not to exceed
$1,000,000 in any calendar year, plus the aggregate cash proceeds
received by the Company during such calendar year from any issuance of
such Equity Interests to employees or directors of the Company or any
Restricted Subsidiary, plus the portion of such $1,000,000 which
remains unused at the end of the prior calendar year, but in no event
to exceed $2,000,000 in any calendar year, provided, that the
cancellation of Indebtedness owing to the Company or a Restricted
Subsidiary from employees or directors in connection with a repurchase
of Equity Interests of the Company or a Restricted Subsidiary will not
be deemed to constitute a Restricted Payment;
(iii) the redemption, repurchase, retirement or other
acquisition of any Capital Stock or other Equity Interests of the
Company or any Restricted Subsidiary in exchange for, or out of the
proceeds of, the substantially concurrent sale (other than to a
Subsidiary of the Company) of other Capital Stock or other Equity
Interests (other than Disqualified Stock) of the Company or the
redemption, repurchase, retirement or other acquisition of any Capital
Stock or other Equity Interests (other than Disqualified Stock) of any
Restricted Subsidiary in exchange for, or out of the proceeds of, the
substantially concurrent sale (other than to the Company or a
Subsidiary of the Company) of other Capital Stock or other Equity
Interests (other than Disqualified Stock) of such Restricted
Subsidiary; provided that, in each case, any net cash proceeds that
are utilized for any such redemption, repurchase, retirement or other
acquisition, and any Net Income resulting therefrom, shall be excluded
from clauses (c)(1) and (c)(2) of this Section 4.06;
(iv) the redemption, repurchase, retirement, defeasance or other
acquisition of any Subordinated Indebtedness of the Company or any
Restricted Subsidiary in exchange for, or out of the proceeds of, the
substantially concurrent sale (other than to a Subsidiary of the
Company) of Capital Stock or other Equity Interests (other than
Disqualified Stock) of the Company or the redemption, repurchase,
retirement, defeasance or other acquisition of any Subordinated
Indebtedness of any Restricted Subsidiary in exchange for, or out of
the proceeds of, the substantially concurrent sale (other than to the
Company or a Subsidiary of the Company) of Capital Stock or other
Equity Interests (other than Disqualified Stock) of such Restricted
Subsidiary; provided that, in each case, any net cash proceeds that
are utilized for any such redemption, repurchase, retirement,
defeasance or other acquisition, and any Net Income resulting
therefrom, shall be excluded from clauses (c)(1) and (c)(2) of this
Section 4.06;
(v) the redemption, repurchase, retirement, defeasance or other
acquisition of any Subordinated Indebtedness of the Company or any
Restricted Subsidiary in exchange for, or out of the proceeds of, any
Refinancing Indebtedness relating to such Subordinated Indebtedness;
(vi) the redemption, repurchase or other acquisition of Series A
Securities or Series B Securities; and
-39-
(vii) payments required pursuant to any indenture or agreement
governing Subordinated Indebtedness of the Company or any Restricted
Subsidiary in respect of any Change of Control or Asset Sale, provided
that payment has theretofore been made with respect to all Securities
tendered in response to a Change of Control Offer or Asset Sale Offer,
as applicable; and
(viii) the payment of (a) management, consulting and financial
advisory fees pursuant to the Morningside Management Agreement or any
amendment thereto in an aggregate amount not to exceed (A) $500,000 in
any fiscal year, if the Company's Cash Flow Coverage Ratio for the
four full fiscal quarters next preceding the date such Restricted
Payment is made was less than 3.0 to 1, or (B) $750,000 in any fiscal
year otherwise and (b) expenses and indemnities pursuant to the
Morningside Management Agreement.
(e) The net proceeds from the issuance of shares of Capital Stock
upon conversion of Indebtedness shall be deemed to be an amount equal to
(i) the accreted value of such Indebtedness on the date of such conversion
and (ii) the additional consideration, if any, received by the Company upon
such conversion thereof, less any cash payment on account of fractional
shares. The amount of all Restricted Payments (other than cash) shall be
the fair market value (as determined by and set forth in a resolution of
the Board of Directors in good faith) on the date of the Restricted Payment
of the asset(s) proposed to be transferred by the Company or a Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment.
SECTION 4.07. Corporate Existence.
Subject to Article Five, the Company and the Guarantors shall do or
shall cause to be done all things necessary to preserve and keep in full force
and effect their respective corporate existence and the corporate, partnership
or other existence of each Restricted Subsidiary in accordance with the
respective organizational documents of each of them (as the same may be amended
from time to time) and the rights (charter and statutory) and material
franchises of the Company, the Guarantors and the Restricted Subsidiaries;
provided, however, that the Company and the Guarantors shall not be required to
preserve any such right or franchise, or the corporate existence of any
Restricted Subsidiary, if the Board of Directors or the boards of directors of
the Guarantors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company, the Guarantors and the
Restricted Subsidiaries, taken as a whole, and that the loss thereof is not, and
will not be, adverse in any material respect to the Holders.
SECTION 4.08. Payment of Taxes and Other Claims.
The Company and the Guarantors shall pay or discharge or cause to be
paid or discharged, before the same shall become delinquent, (1) all material
taxes, assessments and governmental charges levied or imposed upon the Company,
any Guarantor or any Restricted Subsidiary or upon the income, profits or
property of the Company, any Guarantor or any Restricted Subsidiary and (2) all
lawful claims for labor, materials and supplies which, in each case, if unpaid,
might by law become a material liability, or Lien upon the property, of the
Company, any Guarantor or any Restricted Subsidiary; provided, however, that
neither the Company nor the Guarantors shall be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which appropriate provision has been made.
-40-
SECTION 4.09. Notice of Defaults.
(a) In the event that any Indebtedness of the Company, any Guarantor
or any of their Subsidiaries is declared due and payable before its maturity
because of the occurrence of any default (or any event which, with notice or
lapse of time, or both, would constitute such a default) under such
Indebtedness, the Company or such Guarantor shall promptly give written notice
to the Trustee of such declaration, the status of such default or event and what
action the Company or such Guarantor is taking or proposes to take with respect
thereto.
(b) Upon an officer of the Company becoming aware of any Default or
Event of Default, the Company shall promptly deliver an Officers' Certificate to
the Trustee specifying such Default or Event of Default.
SECTION 4.10. Maintenance of Properties and Insurance.
(a) The Company and the Guarantors shall cause all material
properties owned by or leased to any of them or any Restricted Subsidiary and
used or useful in the conduct of their business or the business of any
Restricted Subsidiary to be maintained and kept in normal condition, repair and
working order and supplied with all necessary equipment and shall cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Company or the Guarantors may be
necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section 4.10 shall prevent the Company, any Guarantor or any
Restricted Subsidiary from discontinuing the use, operation or maintenance of
any of such properties, or disposing of any of them, if such discontinuance or
disposal is, in the judgment of the Board of Directors or of the board of
directors of any Guarantor or Restricted Subsidiary concerned, or of an officer
(or other agent employed by the Company, any Guarantor or any Restricted
Subsidiary) of the Company, such Guarantor or such Restricted Subsidiary having
managerial responsibility for any such property, desirable in the conduct of the
business of the Company, any Guarantor or any Restricted Subsidiary, and if such
discontinuance or disposal is not adverse in any material respect to the
Holders.
(b) The Company and the Guarantors shall maintain, and shall cause
the Restricted Subsidiaries to maintain, insurance with responsible carriers
against such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co-insurance provisions, as are customarily carried by
similar businesses of similar size, including property and casualty loss, and
workers' compensation insurance.
SECTION 4.11. Compliance Certificate.
The Company shall deliver to the Trustee within 90 days after the
close of each fiscal year a certificate signed by the principal executive
officer, principal financial officer or principal accounting officer stating
that a review of the activities of the Company has been made under the
supervision of the signing officers with a view to determining whether a Default
or Event of Default has occurred and whether or not the signers know of any
Default or Event of Default by the Company that occurred during such fiscal
year. If they do know of such a Default or Event of Default, the certificate
shall describe all such Defaults or Events of Default, their status and the
action the Company is taking or proposes to take with respect thereto.
-41-
SECTION 4.12. Provision of Financial Information.
So long as the Securities are outstanding, whether or not the Company
or the Guarantors are subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, the Company and the Guarantors shall submit for
filing with the Commission (unless the Commission will not accept such filings)
the annual reports, quarterly reports and other documents relating to the
Company and the Guarantors that the Company and the Guarantors would have been
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act if the Company and the Guarantors were subject to such reporting
requirements. The Company and the Guarantors shall also provide to all Holders
and file with the Trustee copies of such annual reports, quarterly reports and
other documents required to be furnished to securityholders generally under
Sections 13 and 15(d) of the Exchange Act. In addition, for so long as any
Securities remain outstanding and prior to the latter of the consummation of the
Registered Exchange Offer and the filing of the Shelf Registration Statement (as
defined in the Registration Rights Agreement), if required, the Company shall
furnish to the Holders and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of the Trustee of any information contained
therein or determinable from information contained therein, including the
Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 4.13. Waiver of Stay, Extension or Usury Laws.
The Company and the Guarantors covenant (to the extent that they may
lawfully do so) that they shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law, which would prohibit or forgive the
Company or any Guarantor from paying all or any portion of the principal of
and/or interest, if any, on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
performance of this Indenture; and (to the extent that they may lawfully do so)
each of the Company and the Guarantors hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.14. Change of Control.
Following the occurrence of a Change of Control (the date of such
occurrence being the "Change of Control Trigger Date"), the Company shall,
------------------------------
within 30 days after the Change of Control Trigger Date, make an offer (the
"Change of Control Offer") to purchase all Securities then outstanding at a
------------------------
purchase price in cash equal to 101% of the aggregate principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the
date (the "Change of Control Purchase Date") the Securities tendered are
-------------------------------
purchased and paid for in accordance with this Section 4.14. The Company shall
furnish to the Trustee, at least two Business Days before notice of a Change of
Control Offer is mailed to all holders of Securities, notice that the Change of
Control Offer is being made. Within 30 days following any Change of Control
Trigger Date, the Company shall mail a notice to each holder of Securities at
such Holder's registered address stating:
(i) that a Change of Control Offer is being made pursuant to this
Section 4.14 and setting forth in reasonable detail the events giving rise
to a Change of
-42-
Control, the length of time the Change of Control Offer shall remain open
and that all Securities tendered for payment will be accepted for payment,
and otherwise subject to the terms and conditions set forth therein;
(ii) the purchase price, the amount of accrued and unpaid interest
as of the Change of Control Purchase Date, and the Change of Control
Purchase Date (which shall be no earlier than 30 days and no later than 60
days from the date such notice is mailed);
(iii) that any Security or portion thereof not tendered will
continue to accrue interest;
(iv) that any Security or portion thereof accepted for payment
pursuant to the Change of Control Offer shall cease to accrue interest on
and after the Change of Control Purchase Date;
(v) that Holders electing to have a Security purchased pursuant to
the offer will be required to surrender the Security, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed, to a Paying Agent at the address specified in the
notice at least three Business Days before the purchase date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
third Business Day preceding the Change of Control Purchase Date, a
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Securities delivered for purchase and a statement
that such Holder is withdrawing his election to have such Securities
purchased;
(vii) that Holders whose Securities are being purchased only in
part will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered; and
(viii) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such acceptance.
On the Change of Control Purchase Date, the Company shall, to the
extent required by this Indenture and the Change of Control Offer, (1) accept
for payment all Securities or portions thereof (subject to the requirement that
any portion of a Security tendered must be tendered in any integral multiple
$1,000 principal amount) tendered pursuant to the Change of Control Offer; (2)
deposit with the Paying Agent the aggregate purchase price of all Securities or
portions thereof accepted for payment and any accrued and unpaid interest and
Liquidated Damages, if any, on such Securities as of the Change of Control
Purchase Date, and (3) deliver or cause to be delivered to the Trustee all
Securities tendered pursuant to the Change of Control Offer. The Paying Agent
shall promptly mail to each holder of Securities or portions thereof accepted
for payment an amount equal to the purchase price for such Securities plus any
accrued and unpaid interest and Liquidated Damages, if any, thereon, and the
Trustee shall promptly authenticate and mail (or cause to be transferred by
book-entry) to such holder of Securities accepted for payment in part a new
Security equal in principal amount to any unpurchased portion of the Securities
and any Security not accepted for payment in whole or in part shall be promptly
returned to the holder thereof. The Company will publicly announce the results
of the Change of Control Offer on or as soon as practicable after the Change of
Control Purchase Date.
The Company will comply with any tender offer rules under the
Exchange Act which may then be applicable, including Rule 14e-1, in connection
with a Change of Control Offer. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Indenture, the
Company shall
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comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Indenture by virtue thereof.
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.
The Company shall not issue any Indebtedness that is subordinate or
junior in right of payment to any Senior Indebtedness and senior in any respect
in right of payment to the Securities. No Guarantor shall issue any
Indebtedness that is subordinate or junior in right of payment to any Senior
Indebtedness and senior in any respect in right of payment to the Guarantees.
SECTION 4.16. Limitations on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective, any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to: (a) pay dividends or make any other
distributions on its Capital Stock or any other interest or participation in, or
measured by, its profits, owned by the Company or any Restricted Subsidiary, or
pay any Indebtedness owed to, the Company or any Restricted Subsidiary, (b) make
loans or advances to the Company, or (c) transfer any of its properties or
assets to the Company, except for such encumbrances or restrictions existing
under or by reason of:
(i) applicable law or regulations;
(ii) customary provisions restricting subletting or assignment of
any lease or license of the Company or any Restricted Subsidiary;
(iii) any instrument governing Indebtedness or any other
encumbrance or restriction of a Person affecting such Person or its
property or assets acquired by the Company or any Restricted Subsidiary at
the time of such acquisition (provided that such Indebtedness or other
encumbrance or restriction was not issued in contemplation of the
acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired;
(iv) the New Credit Facility;
(v) any other agreement or instrument evidencing Indebtedness of a
Foreign Subsidiary permitted under this Indenture;
(vi) any other agreement or instrument in effect as of or entered
into on the Issue Date or imposed by this Indenture, the Guarantees, the
Series A Securities, the Series B Securities, or the guarantees thereon (or
similar limitations pursuant to other notes issued by the Company or other
indentures relating thereto that are substantially similar to those set
forth in this Indenture);
(vii) any Refinancing Indebtedness permitted under Section 4.04;
provided that the encumbrances and restrictions created in connection with
such Refinancing Indebtedness are no more restrictive in any material
respect with regard to the interests of the holders of Securities than the
encumbrances and restrictions in the refinanced Indebtedness (as determined
by the Board of Directors in good faith);
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(viii) the terms of purchase money obligations, but only to the
extent such purchase money obligations restrict or prohibit the transfer of
the property so acquired;
(ix) any other agreement or instrument evidencing or relating to
secured Indebtedness of the Company or any Restricted Subsidiary otherwise
permitted to be issued pursuant to the provisions of Sections 4.04 and 4.18
that limit the right of the debtor to dispose of the property or assets
securing such Indebtedness;
(x) customary net worth provisions contained in leases and other
agreements entered into in the ordinary course of business;
(xi) the terms of agreements with respect to the sale of assets of
the Company or a Subsidiary of the Company otherwise permitted by this
Indenture, provided that such restriction terminates if such transaction is
not consummated;
(xii) the terms of agreements that have been entered into for the
sale of all or substantially all of the Capital Stock, business, assets or
properties of a Restricted Subsidiary, provided that such restriction
terminates if such transaction is not consummated;
(xiii) with respect to a Restricted Subsidiary that is not a
Restricted Subsidiary on the Issue Date, instruments in existence at the
time such Person becomes a Restricted Subsidiary and not entered into in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary;
(xiv) customary provisions in joint venture agreements and other
similar agreements with respect to dividends and other similar
distributions to the parties to such joint venture, the disposition or
distribution of assets or property of such joint venture, or transactions
between or among the joint venture and the parties to such joint venture;
or
(xv) any Permitted Lien, with respect to restrictions on the sale
or other disposition of the assets or property subject to such Permitted
Lien.
SECTION 4.17. Designation of Restricted and Non-Restricted Subsidiaries.
(a) The Board of Directors of the Company may designate any
Restricted Subsidiary to be an Unrestricted Subsidiary if such designation would
not cause a Default. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under clause (c) of Section 4.06. All such outstanding
Investments shall be deemed to constitute Investments in an amount equal to the
fair market value of such Investments at the time of such designation. Such
designation shall only be permitted if such Restricted Payment would be
permitted at such time and if such Restricted Subsidiary otherwise meets the
definition of an Unrestricted Subsidiary.
(b) The designation of a Subsidiary as a Restricted Subsidiary or the
removal of such designation shall be made by a resolution adopted by a majority
of the Board of Directors stating that the Board of Directors has made such
designation in accordance with this Indenture, and the Company shall deliver to
the Trustee such resolution together with an Officers' Certificate certifying
that the designation complies with this
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Indenture. Such designation will be effective as of the date specified in the
applicable resolution which may not be before the date the applicable Officers'
Certificate is delivered to the Trustee.
SECTION 4.18. Limitation on Liens.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create, incur, assume or suffer to exist any Liens of any kind
against or upon any of its property or assets, or any proceeds therefrom, unless
(x) in the case of Liens securing Subordinated Indebtedness, the Securities are
secured by a Lien on such property, assets or proceeds that is senior in
priority to such Liens and (y) in all other cases, the Securities are equally
and ratably secured, except for (a) Liens existing as of the Issue Date and
securing any extensions, refinancings, renewals, replacements, substitutions or
refundings of the Obligations secured thereby, provided such Liens do not extend
to or cover any property or assets of the Company or any of its Restricted
Subsidiaries not securing Indebtedness as of the Issue Date; (b) Liens securing
the Series A Securities and the Series B Securities and Liens in favor of the
Trustee and any Lien granted, in respect of amounts owed to such trustee or
similar institution, to any trustee or similar institution under any indenture
for Indebtedness permitted by the terms of this Indenture; (c) Liens on assets
of the Company and its Subsidiaries securing Senior Indebtedness; (d) Liens in
favor of the Company or any Restricted Subsidiary; (e) Liens securing
Indebtedness which is incurred to refinance Indebtedness which has been secured
by a Lien permitted under this Indenture and which has been incurred in
accordance with the provisions of this Indenture, provided, however, that such
Liens do not extend to or cover any property or assets of the Company or any of
its Restricted Subsidiaries not securing the Indebtedness so refinanced; and (f)
Permitted Liens.
SECTION 4.19. Limitation on Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company and its Restricted Subsidiaries may enter into a sale and leaseback
transaction if:
(i) the Company and its Restricted Subsidiaries could have (a)
incurred Indebtedness in an amount equal to the Attributable Debt relating
to such sale and leaseback transaction pursuant to the Company's Cash Flow
Coverage Ratio test set forth in paragraph (a) of Section 4.04;
(ii) the cash proceeds of such sale and leaseback transaction are
at least equal to the fair market value (as determined in good faith by the
Board of Directors and set forth in an Officers' Certificate delivered to
the Trustee) of the property that is the subject of such sale and leaseback
transaction; and
(iii) to the extent such sale and leaseback transaction is an
Asset Sale, the proceeds of such transaction are applied in compliance with
Section 4.05.
SECTION 4.20. Subsidiary Guarantees.
The Company's obligations under this Indenture and the Securities
shall be guaranteed on a senior subordinated basis as of the date hereof by
Xxxxxx Products and in the future may be jointly and severally guaranteed by
certain other Subsidiaries (other than (i) Foreign Subsidiaries that are not
guarantors under the New Credit Facility and (ii) Unrestricted Subsidiaries) of
the Company.
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If (i) any Restricted Subsidiary shall become a guarantor under the
New Credit Facility, (ii) any Restricted Subsidiary shall become a guarantor
under any Indebtedness ("Other Company Indebtedness") of the Company or a
--------------------------
Restricted Subsidiary, other than the Securities, the New Credit Facility or
Indebtedness of a Foreign Subsidiary or (iii) the Company or any of its
Restricted Subsidiaries shall acquire or create another Subsidiary after the
date of this Indenture, then such Restricted Subsidiary or newly acquired or
created Subsidiary, as the case may be, shall execute a Guarantee in accordance
with Section 11.05 and deliver an Opinion of Counsel; provided, however, that
(A) any guarantee pursuant to clause (ii) of this paragraph shall be limited to
such portion of the aggregate principal amount of outstanding Securities as
equals the principal amount of such Other Company Indebtedness that is
guaranteed by such Restricted Subsidiary, (B) if the Other Company Indebtedness
guaranteed by such Restricted Subsidiary is (1) Senior Indebtedness, the
guarantee for the Securities shall be subordinated in right of payment with the
Other Company Indebtedness guarantee and (2) Subordinated Indebtedness, the
guarantee for the Securities shall be pari passu or senior in right of payment
to the Other Company Indebtedness guarantee and (C) clause (iii) of this Section
4.20 shall not apply (x) to any Subsidiary of the Company during such period as
such Subsidiary is inactive, has assets of less than $50,000 and has less than
$1,000 of outstanding Indebtedness owed to any person other than the Company or
a Restricted Subsidiary or (y) to any newly acquired or created Subsidiary that
is also a Foreign Subsidiary. This Section 4.20 shall not apply to any newly
acquired or created Subsidiary that has been properly designated as an
Unrestricted Subsidiary in accordance with the Indenture for so long as it
continues to be an Unrestricted Subsidiary.
The Company may cause any Foreign Subsidiary not otherwise required to
guarantee the Securities to guarantee the Securities on a senior subordinated
basis, in which case such Foreign Subsidiary shall be a Guarantor for purposes
of this Indenture.
SECTION 4.21. Limitations as to Unrestricted Subsidiaries.
The Company shall not permit any Unrestricted Subsidiary to issue
Indebtedness except Non-Recourse Debt. The Company and its Restricted
Subsidiaries shall not designate, create or purchase any Unrestricted
Subsidiary, unless the Board of Directors shall have made a determination (as
set forth in the resolution approving such designation, creation or purchase)
that the designation, creation and operation of the Unrestricted Subsidiary is
not reasonably expected to materially and adversely affect the financial
condition, business, or operations of the Company and its Restricted
Subsidiaries taken together as a whole (which resolution shall be conclusive
evidence of compliance with this provision).
SECTION 4.22. Payments for Consent.
The Company shall not and shall not permit any of its Restricted
Subsidiaries to, 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 or any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Securities or the Guarantees, unless such
consideration is offered to be paid or agreed to be paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
SECTION 4.23. Limitation on Lines of Business.
The Company shall not, and shall not permit any Restricted Subsidiary
to, engage in or conduct any business other than the manufacture, distribution
and/or sale of health and beauty aids, cosmetics and/or other personal care
products, and businesses ancillary, complementary or reasonably related thereto,
reasonable extensions thereof.
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ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets.
(a) The Company shall not consolidate or merge with or into, or sell,
lease, convey or otherwise dispose of all or substantially all of its assets to,
any corporation, Person or entity (any such consolidation, merger or sale being
a "Disposition") unless: (i) the successor corporation of such Disposition or
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the Person to which such Disposition shall have been made (A) is a corporation
organized or existing under the laws of the United States of America, any state
thereof or the District of Columbia or (B) is Xxxxxx South Africa; (ii) in the
case of clause (i)(B), the Company, prior to any such transaction, shall have
complied with paragraph (b) of this Section 5.01; (iii) the successor
corporation of such Disposition or the corporation to which such Disposition
shall have been made expressly assumes the Obligations of the Company under this
Indenture, the Securities and the Registration Rights Agreement pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee (which
supplemental indenture, in the case of clause (i)(B), shall provide that such
successor shall irrevocably submit to the exclusive jurisdiction of the Supreme
Court of the State of New York, New York County and to the jurisdiction of the
United States District Court for the Southern District of New York for the
purposes of any proceeding relating to the Securities or this Indenture, appoint
an agent in the State of New York and waive foreign sovereign immunity); (iv)
immediately after such Disposition, no Default or Event of Default shall exist;
and (v) the corporation formed by or surviving any such Disposition, or the
corporation to which such Disposition shall have been made, shall be permitted
immediately after the Disposition by the terms of this Indenture to issue at
least $1.00 of additional Indebtedness pursuant to paragraph (a) of Section 4.04
determined on a Pro Forma Basis, and (iii) have a Cash Flow Coverage Ratio, for
the four fiscal quarters immediately preceding the applicable Disposition, and
determined on a Pro Forma Basis, equal to or greater than the actual Cash Flow
Coverage Ratio of the Company for such four quarter period Basis;
provided, however, that a Disposition effected solely for the purpose of
changing the Company's jurisdiction of incorporation pursuant to clause (i)(A)
need not comply with the foregoing clauses (iv) and (v).
Prior to the consummation of any proposed Disposition, the Company
shall deliver to the Trustee an Officers' Certificate to the foregoing effect
and an Opinion of Counsel stating that the proposed Disposition and such
supplemental indenture comply with this Indenture. In connection with any other
actions in accordance with this Section 5.01, the Company shall deliver to the
Trustee, upon request of the Trustee, an Officers' Certificate and Opinion of
Counsel in compliance with Section 13.04.
(b) Prior to any Disposition pursuant to clause (i)(B) of paragraph
(a) of this Section 5.01, the Company shall make on at least 30 but not more
than 60 days' notice, an offer to purchase all of the Securities then
outstanding, at a purchase price in cash equal to the sum of (i) the principal
amount thereof plus (ii) accrued and unpaid interest and Liquidated Damages, if
any, to the date of purchase plus (iii) the Applicable Premium. At least 30 but
not more than 60 days prior to the proposed effective date of a Disposition
pursuant to clause (i)(B), the Company shall mail a notice to each Holder at
such Holder's registered address stating:
(i) that the Company intends to effect a Disposition pursuant to
which Xxxxxx South Africa will be the successor and that an offer is being
made to purchase all of the Securities then outstanding; the proposed
effective date of the Disposition and the length of time the offer shall
remain open;
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(ii) the purchase price, the amount of accrued and unpaid interest
as of the purchase date, and the purchase date (which shall be no earlier
than 30 days and no later than 60 days from the date such notice is
mailed);
(iii) that any Security or portion thereof not tendered will
continue to accrue interest;
(iv) that any Security or portion thereof accepted for payment
pursuant to the offer shall cease to accrue interest on and after the
purchase date;
(v) that Holders electing to have a Security purchased pursuant to
the offer will be required to surrender the Security, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed, to a Paying Agent at the address specified in the
notice at least three Business Days before the purchase date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
third Business Day before the purchase date, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the
Security the Holder delivered for purchase and a statement that such Holder
is withdrawing his election to have the Security purchased;
(vii) that Holders whose Securities were purchased only in part
will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered; and
(viii) a brief description of the circumstances and relevant facts
regarding the proposed transaction.
On the purchase date (which shall be the effective date of the
Disposition) for any such offer, the Company shall (1) accept for payment all
Securities or portions thereof tendered pursuant to such offer, (2) deposit with
the Paying Agent the aggregate purchase price of all Securities or portions
thereof accepted for payment and any accrued and unpaid interest on such
Securities as of the purchase date, and (3) deliver or cause to be delivered to
the Trustee all Securities tendered pursuant to such offer. The Paying Agent
shall promptly mail to each holder of Securities or portions thereof accepted
for payment an amount equal to the purchase price for such Securities plus any
accrued and unpaid interest thereon, and the Trustee shall promptly authenticate
and mail (or cause to be transferred by book-entry) to any such holder of
Securities accepted for payment in part a new Security equal in principal amount
to any unpurchased portion of the Securities and any Security not accepted for
payment in whole or in part shall be promptly returned to the Holder thereof.
The Company will publicly announce the results of the offer as soon as
practicable after the purchase date.
The Company shall comply with any tender offer rules under the
Exchange Act which may then be applicable, including Rule 14e-1, in connection
with an offer required to be made by the Company to repurchase the Securities in
contemplation of such Disposition. To the extent that the provisions of any
securities laws or regulations conflict with provisions of the Indenture, the
Company shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this Indenture by
virtue thereof.
(c) No Guarantor may consolidate with or merge with or into (whether
or not such Guarantor is the surviving person), another corporation, Person or
entity whether or not affiliated with such Guarantor unless:
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(i) subject to the provisions of paragraph (d) of this Section
5.01, the Person formed by or surviving any such consolidation or merger
(if other than such Guarantor) assumes all the obligations of such
Guarantor pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, under the Guarantee of such
Guarantor and this Indenture;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(iii) the Company would be permitted by virtue of the Company's
pro forma Cash Flow Coverage Ratio, immediately after giving effect to such
transaction, to issue at least $1.00 of additional Indebtedness pursuant to
the Cash Flow Coverage Ratio test set forth in paragraph (a) of Section
4.04; provided, however, that the requirements of this clause (iii) will
not apply in the case of a consolidation with or merger with or into the
Company or another Guarantor.
(d) In the event of (i) a sale, exchange, transfer or other
disposition of all or substantially all of the assets of any Guarantor, by way
of merger, consolidation or otherwise, or a sale, exchange, transfer or other
disposition of all of the Capital Stock of any Guarantor, (ii) the designation
by the Company of a Guarantor to be an Unrestricted Subsidiary, or (iii) the
release of the guarantee of any Guarantor with respect to the New Credit
Facility or any Other Company Indebtedness which caused such Guarantor to
deliver a Guarantee of the Securities in accordance with clause (i) or clause
(ii) of Section 4.20, then such Guarantor (in the event of a sale, exchange,
transfer or other disposition, by way of such a merger, consolidation or
otherwise, of all of the Capital Stock of such Guarantor or any such designation
or any such release) or each of the corporations acquiring the property of such
Guarantor and such Guarantor (in the event of a sale, exchange, transfer or
other disposition of all or substantially all of the assets of such Guarantor)
will be automatically released and relieved of any obligations under the
Guarantee of such Guarantor; provided that the Net Proceeds of a sale, exchange,
transfer or other disposition described in clause (i) of this paragraph (d) are
applied in accordance with the requirements of Section 4.05.
SECTION 5.02. Successor Corporation Substituted.
In the event of any Disposition of the Company or any Guarantor in
accordance with Section 5.01, the successor corporation formed by such
consolidation or into which the Company or such Guarantor is merged or to which
such Disposition is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company or such Guarantor under this
Indenture with the same effect as if such successor corporation had been named
as the Company or such Guarantor herein, and thereafter the predecessor
corporation shall be relieved of all Obligations and covenants under this
Indenture and the Securities.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following shall be an "Event of Default" for
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purposes of this Indenture:
(a) a default for 30 days in payment of interest on the
Securities;
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(b) a default in payment when due of principal or premium, if any,
with respect to the Securities;
(c) the failure of the Company to comply with clauses (i), (ii)
and (iii) of the first paragraph of Section 4.06, Section 4.14 or
paragraphs (a) and (b) of Section 5.01;
(d) the failure of the Company to comply with any of its other
agreements or covenants in, or provisions of, this Indenture or the
Securities outstanding hereunder (other than an Event of Default arising
under paragraph (a) or (b) of Section 5.01 which shall be an Event of
Default with the notice but without the passage of time specified in this
paragraph), for 30 days after notice in writing to the Company by the
Trustee, or to the Company and the Trustee by the Holders of at least 25%
in principal amount of the Securities then outstanding specifying such
default;
(e) a default by the Company or any Restricted Subsidiary under
any mortgage, indenture or instrument under which there is issued or by
which there is secured or evidenced any Indebtedness for money borrowed by
the Company or any Restricted Subsidiary (or the payment of which is
guaranteed by the Company or any Restricted Subsidiary), whether such
Indebtedness or guarantee now exists or shall be created hereafter, if (1)
either (A) such default results from the failure to pay principal of or
interest on any such Indebtedness (after giving effect to any extensions
thereof) or (B) as a result of such default the maturity of such
Indebtedness has been accelerated prior to its expressed maturity, and (2)
the principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay
principal or interest thereon, or, because of the acceleration of the
maturity thereof, aggregates in excess of $7,500,000;
(f) a failure by the Company or any Restricted Subsidiary to pay
final judgments (not covered by insurance) aggregating in excess of
$7,500,000 which judgments a court of competent jurisdiction does not
rescind, annul or stay within 60 days after their entry;
(g) the Company or any of its Significant Subsidiaries (i)
commences a voluntary case, (ii) consents to the entry of an order for
relief against it in an involuntary case, (iii) consents to the appointment
of a Custodian of it or for all or substantially all of its property or
(iv) makes a general assignment for the benefit of its creditors, in each
case, pursuant to or within the meaning of the Bankruptcy Law;
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (i) is for relief against the Company or
any of its Significant Subsidiaries in an involuntary case; (ii) appoints a
Custodian of the Company or any of its Significant Subsidiaries or for all
or substantially all of the property of the Company or any of its
Significant Subsidiaries; or (iii) order the liquidation of the Company or
any of its Significant Subsidiaries; and the order or decree remains
unstayed and in effect for 60 consecutive days; and
(i) the Guarantee of any Guarantor ceases to be in full force and
effect (other than in accordance with the terms of such Guarantee and this
Indenture) or is declared null and void and unenforceable or found to be
invalid or any Guarantor denies its liability under its Guarantee (other
than by reason of a release of such Guarantor from its Guarantee in
accordance with the terms of such Guarantee and this Indenture.
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In the case of any Event of Default pursuant to clause (a) or (b)
above occurring by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Company with the principal intention of avoiding
payment of the premium that the Company would have to pay pursuant to a
redemption of Securities as described under Article Three, an equivalent premium
shall also become and be immediately, due and payable to the extent permitted by
law upon the acceleration of the Securities.
SECTION 6.02. Acceleration.
Upon the occurrence of an Event of Default, the Trustee or the Holders
of at least 25% in principal amount of the then outstanding Securities may
declare all Securities to be due and payable by notice in writing to the Company
and the Trustee specifying the respective Event of Default and that it is a
"notice of acceleration" (the "Acceleration Notice") and the same shall become
-------------------
immediately due and payable or, if there are any amounts outstanding under the
New Credit Facility, shall become immediately due and payable upon the first to
occur of acceleration of the New Credit Facility or five Business Days after
receipt by the Company of such Acceleration Notice, but only if such Event of
Default is then continuing. In the case of an Event of Default arising from the
events specified in paragraphs (g) or (h) of Section 6.01 with respect to the
Company or any Significant Subsidiary, the principal of, premium, if any, and
any accrued and unpaid interest on all outstanding Securities shall ipso facto
become immediately due and payable without further action or notice.
The Holders of a majority in principal amount of the Securities then
outstanding under this Indenture, by notice to the Trustee, may rescind any
declaration of acceleration of such Securities and its consequences if all
existing Events of Default (other than the nonpayment of principal of or
interest on such Securities that shall have become due by such declaration)
shall have been cured or waived.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest and Liquidated Damages, if any, 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
maturing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All available
remedies are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Default.
Subject to Sections 2.09, 6.07 and 10.02, prior to the declaration of
acceleration of the Securities, the Holders of not less than a majority in
aggregate principal amount of the then outstanding Securities by written notice
to the Trustee may on behalf of all Holders waive an existing Default or Event
of Default and its consequences hereunder, except a continuing Default in the
payment of principal of or premium, if any, or interest or Liquidated Damages,
if any, on any Security or a Default in respect of any term or provision of this
Indenture that may not be amended or modified without the consent of each Holder
affected as provided in Section 10.02. The Company shall deliver to the Trustee
an Officers' Certificate stating that the requisite percentage of Holders have
consented to such waiver and attaching copies of such consents. In case of any
such waiver, the Company, the Trustee and the Holders shall be restored to their
former positions and rights hereunder and under the Securities, respectively.
This paragraph of this Section 6.04 shall be in lieu of (S) 316(a)(1)(B) of the
TIA and
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such (S) 316(a)(1)(B) of the TIA is hereby expressly excluded from this
Indenture and the Securities, as permitted by the TIA.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred for every
purpose of this Indenture and the Securities, but no such waiver shall extend to
any subsequent or other Default or Event of Default or impair any right
consequent thereon.
SECTION 6.05. Control by Majority.
Subject to Section 2.09, the Holders of a majority in principal amount
of the outstanding Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Securityholder, or
that may involve the Trustee in personal liability; provided, however, that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. In the event the Trustee takes any action or
follows any direction pursuant to this Indenture, the Trustee shall be entitled
to indemnification satisfactory to it in its sole discretion against any loss or
expense caused by taking such action or following such direction. This Section
6.05 shall be in lieu of (S) 316(a)(1)(A) of the TIA, and such (S) 316(a)(1)(A)
of the TIA is hereby expressly excluded from this Indenture and the Securities,
as permitted by the TIA.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(i) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount of
the outstanding Securities make a written request to the Trustee to pursue
a remedy;
(iii) such Holder or Holders offer and, if requested, provide to
the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision
of indemnity; and
(v) during such 60-day period the Holders of a majority in
principal amount of the outstanding Securities do not give the Trustee a
direction which, in the opinion of the Trustee, is inconsistent with the
request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
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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 or interest or Liquidated Damages,
if any, on a Security, on or after the respective due dates expressed in the
Security, 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
the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or premium, if any, or
interest or Liquidated Damages, if any, specified in Section 6.01(i) or (ii)
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company or the Guarantors or any
other obligor on the Securities for the whole amount of principal and premium,
if any, and accrued interest remaining unpaid, and Liquidated Damages, if any,
together with interest overdue on principal and to the extent that payment of
such interest is lawful, interest on overdue installments of interest, in each
case at the rate per annum borne by the Securities and such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relative to the Company or
the Guarantors (or any other obligor upon the Securities), any of their
respective creditors or any of their respective property and shall be entitled
and empowered to participate as a member, voting or otherwise, of any official
committee of creditors appointed in such matter and to collect and receive any
monies or other property payable or deliverable on any such claims and to
distribute the same, and any custodian in any such judicial proceedings is
hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel, and any other amounts due the Trustee under
Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this Article
Six, subject to the provisions of Articles Eight and Twelve, 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 for amounts due and unpaid on the Securities
for principal, premium, if any, or Liquidated Damages, if any, 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
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Third: to the Company or, to the extent the Trustee collects any
amount from the Guarantors, to the Guarantors.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Securityholders pursuant to this
Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by
a Holder or group of Holders of more than 10% in aggregate principal amount of
the outstanding Securities, or to any suit instituted by any Holder for the
enforcement or the payment of the principal of or interest or premium or
Liquidated Damages, if any, on any Securities on or after the respective due
dates expressed in the Security.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default has occurred and is continuing, the Trustee shall
exercise such of 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 its own affairs.
(b) Except during the continuance of a Default:
(1) The Trustee shall not be liable except for the performance of
such duties as are specifically set forth herein and in the TIA and no
implied covenants or obligations shall be read into the Indenture against
the Trustee, provided, however to the extent of any conflict between the
duties of the Trustee hereunder and under the TIA, the TIA shall control;
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 conforming to
the requirements of this Indenture; however, the Trustee shall examine such
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts stated therein or
otherwise verify the contents thereof).
(c) The Trustee shall not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
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(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) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it or it does not receive from such Holders an indemnity
satisfactory to it in its sole discretion against such risk, liability, loss,
fee or expense which might be incurred by it in compliance with such request or
direction.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may conclusively rely on any document believed by
it to be genuine and to have been signed or presented by the proper person.
The Trustee need not investigate any fact or matter stated in the document.
The Trustee shall receive and retain financial reports and statements of
the Company as provided herein, but it shall have no duty to review or
analyze such reports or statements to determine compliance with covenants
or other obligations of the Company.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and/or an Opinion of Counsel, which shall
conform to the provisions of Section 13.05. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through attorneys and agents of its
selection and shall not be responsible for the misconduct or negligence of
any agent or attorney (other than an agent who is an employee of the
Trustee) 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 reasonably believes to be authorized
or within its rights or powers.
(e) The Trustee may consult with counsel and the advice or opinion
of such counsel as to matters of law shall be full and complete
authorization and protection from liability in respect of any action taken,
omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
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(f) Any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
request or direction of any Guarantor mentioned herein shall be
sufficiently evidenced if signed by an officer of such Guarantor.
(g) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or
direction of any of the Securityholders pursuant to this Indenture, unless
such Securityholders shall have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(h) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, security, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company
or the Guarantor, personally or by agent or attorney.
(i) The Trustee shall not be deemed to have notice of any Event of
Default unless a Trust Officer of the Trustee has actual knowledge thereof
or unless the Trustee shall have received written notice thereof at the
Corporate Trust Office of the Trustee, and such notice references the
Securities and this Indenture.
(j) Permissive rights or powers available to the Trustee hereunder
shall not be assumed to be mandatory duties or obligations.
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, subject to
Section 7.10 hereof. Any Agent may do the same with like rights. However, the
Trustee is subject to 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 or the Guarantors in
this Indenture or any document issued in connection with the sale of Securities
or any statement in the Securities other than the Trustee's certificate of
authentication.
SECTION 7.05. Notice of Defaults.
The Company shall deliver to the Trustee annually a statement
regarding compliance with this Indenture and, upon an Officer of the Company
becoming aware of any Default or Event of Default, a statement specifying such
Default or Event of Default. If a Default or an Event of Default occurs and is
continuing and the Trustee knows of such Default or Event of Default, the
Trustee shall mail to each Securityholder notice of the Default or Event of
Default within 90 days after the occurrence thereof. Except in the case of a
Default or an
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Event of Default in payment of principal of or premium, if any, or
interest or Liquidated Damages, if any, on any Security or a Default or Event of
Default in complying with Section 5.01 hereof, 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 interest of Securityholders.
This Section 7.05 shall be in lieu of the proviso to (S) 315(b) of the TIA and
such proviso to (S) 315(b) of the TIA is hereby expressly excluded from this
Indenture and the Securities, as permitted by the TIA.
SECTION 7.06. Reports by Trustee to Holders.
If required by TIA (S) 313(a), within 60 days after each May 15
beginning with the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a report dated as of such May 15 that complies
with TIA (S) 313(a). The Trustee also shall comply with TIA (S) 313(b), (c) and
(d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the Commission and each stock exchange, if
any, on which the Securities are listed.
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any stock exchange or of any delisting thereof.
SECTION 7.07. Compensation and Indemnity.
The Company and the Guarantors jointly and severally shall pay to the
Trustee from time to time such compensation as the Company and the Trustee shall
from time to time agree in writing 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 and the Guarantors shall reimburse the Trustee upon request
for all reasonable disbursements, expenses and advances (including fees,
disbursements and expenses of its agents and counsel) incurred or made by it in
addition to the compensation for its services except any such disbursements,
expenses and advances as may be attributable to the Trustee's negligence or bad
faith. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents, accountants, experts and counsel and any
taxes or other expenses incurred by a trust created pursuant to Section 9.01
hereof.
The Company and the Guarantors jointly and severally shall indemnify
the Trustee for, and hold it harmless against any and all loss, damage, claims,
liability or expense, including taxes (other than franchise taxes imposed on the
Trustee and taxes based upon, measured by or determined by the income of the
Trustee), arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent that
such loss, damage, claim, liability or expense is due to its own negligence or
bad faith. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. However, the failure by
the Trustee to so notify the Company shall not relieve the Company or the
Guarantors of their respective obligations hereunder. The Company and the
Guarantor shall defend the claim and the Trustee shall cooperate in the defense
(and may employ its own counsel) at the Company's and the Guarantors' expense;
provided, however, that the Company's and the Guarantors' reimbursement
obligation with respect to counsel employed by the Trustee will be limited to
the reasonable fees and expenses of such counsel.
The Company and the Guarantors need not pay for any settlement made
without their written consent, which consent shall not be unreasonably withheld.
The Company and the Guarantors need not xxxx-
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xxxxx any expense or indemnify against any loss or liability incurred by the
Trustee attributable to the Trustee's negligence or bad faith.
To secure the Company's and the Guarantors' payment obligations in
this Section 7.07, the Trustee shall have a Lien prior to the Securities against
all money or property held or collected by the Trustee, in its capacity as
Trustee, except money or property held in trust to pay principal of or premium,
if any, or interest or Liquidated Damages, if any, on particular Securities or
the purchase price or redemption price of any Securities to be purchased
pursuant to an Asset Sale Offer, Change of Control Offer or an offer pursuant to
paragraph (b) of Section 5.01.
When the Trustee incurs expenses or renders services after an Event of
Default specified in paragraph (g) of Section 6.01 occurs, the expenses
(including the reasonable fees and expenses of its agents and counsel) and the
compensation for the services shall be preferred over the status of the Holders
in a proceeding under any Bankruptcy Law and are intended to constitute expenses
of administration under any Bankruptcy Law. The Company's and the Guarantors'
obligations under this Section 7.07 and any claim arising hereunder shall
survive the resignation or removal of any Trustee, the discharge of the
Company's and the Guarantors' obligations pursuant to Article Nine and any
rejection or termination under any 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 outstanding
Securities may remove the Trustee by so notifying the Trustee and the Company in
writing and may appoint a successor Trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent under any
Bankruptcy Law;
(3) a custodian or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee pursuant to Section 7.07, all property held
by it as Trustee to the successor Trustee, subject to the Lien provided in
Section 7.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have the rights, powers and duties of
the Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the outstand-
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ing Securities may petition, at the expense of the Company, 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 replacement of the Trustee pursuant to this Section
7.08, the Company's and the Guarantors' obligations under Section 7.07 shall
continue for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking corporation, the resulting, surviving or transferee
corporation or banking corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee which shall be eligible to
act as Trustee under TIA (S)(S) 310(a)(1) and 310(a)(2). 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. If the Trustee has or shall
acquire any "conflicting interest" within the meaning of TIA (S) 310(b), the
Trustee and the Company shall comply with the provisions of TIA (S) 310(b);
provided, however, that there shall be excluded from the operation of TIA (S)
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 (S)
310(b)(1) are met. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 7.10, the Trustee shall resign
immediately in the manner and with the effect hereinbefore specified in this
Article Seven.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior Indebtedness.
The Company covenants and agrees, and the Trustee and each Holder of
the Securities by his acceptance thereof likewise covenant and agree, that all
Securities shall be issued subject to the provisions of this Article Eight; and
each person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees that all payments of the
principal of and premium interest and Liquidated Damages, if any, on the
Securities by the Company or the Guarantor shall, to the extent and in the
manner set forth in this Article Eight, be subordinated in right of payment to
the prior payment in full in cash or
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Marketable Securities of all amounts payable under Senior Indebtedness, whether
outstanding on the date of the Indenture or thereafter incurred.
SECTION 8.02. No Payment on Securities in Certain Circumstances.
(a) No direct or indirect payment by or on behalf of the Company of
principal of or interest and Liquidated Damages, if any, on the Securities,
whether pursuant to the terms of the Securities, upon acceleration, pursuant to
an Asset Sale Offer, a Change of Control Offer, an offer pursuant to paragraph
(b) of Section 5.01 or otherwise, shall be made to the Holders of Securities and
instead shall be made to the Holders of Senior Indebtedness (except that Holders
of Securities may receive payments made in Permitted Junior Securities or from
the defeasance trust described under Section 9.04) if (i) a default in the
payment of the principal of or premium, if any, or interest on Designated Senior
Indebtedness occurs and is continuing beyond any applicable period of grace or
(ii) any other default occurs and is continuing with respect to Designated
Senior Indebtedness that permits holders of the Designated Senior Indebtedness
as to which such default relates to accelerate its maturity and the Trustee
receives a written notice (with a copy to the Company) of such other default (a
"Payment Blockage Notice") from the Company or the holders of any Designated
-----------------------
Senior Indebtedness until all Obligations with respect to Senior Indebtedness
are paid in full; payments on the Securities shall be resumed (a) in the case of
a payment default, upon the date on which such default is cured or waived and
(b) in case of a nonpayment default, the earlier of the date on which such
nonpayment default is cured or waived or 179 days after the date on which the
applicable Payment Blockage Notice is received by the Trustee (such period being
referred to herein as the "Payment Blockage Period"), unless the maturity of any
-----------------------
Designated Senior Indebtedness has been accelerated (and written notice of such
acceleration has been received by the Trustee). No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice (it being understood that any subsequent action, or any breach of any
covenant for a period commencing after the date of receipt by the Trustee of
such Payment Blockage Notice, that, in either case, would give rise to such a
default pursuant to any provisions under which a default previously existed or
was continuing shall constitute a new default for this purpose).
Notwithstanding anything herein or in the Securities to the contrary,
(x) in no event shall a Payment Blockage Period extend beyond 179 days from the
date the Payment Blockage Notice in respect thereof was given, (y) there shall
be a period of at least 181 consecutive days in each 360-day period when no
Payment Blockage Period is in effect and (z) not more than one Payment Blockage
Period may be commenced with respect to the Securities during any period of 360
consecutive days. No new period of payment blockage may be commenced unless and
until all scheduled payments of principal, premium, if any, and interest on the
Securities that have come due have been paid in cash. No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice (it being understood that any subsequent action, or any breach of any
covenant for a period commencing after the date of receipt by the Trustee of
such Payment Blockage Notice, that, in either case, would give rise to such a
default pursuant to any provisions under which a default previously existed or
was continuing shall constitute a new default for this purpose).
(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by Section 8.02(a), such payment shall be held for the benefit of, and shall be
paid over or delivered to, the holders of Designated Senior Indebtedness or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Designated Senior Indebtedness may have
been issued, as their respective interests may appear, but only to the extent
that, upon notice from the Trustee to the holders of Designated Senior
Indebtedness that such prohibited payment has been made, the holders of the
Designated Senior Indebtedness (or their representative or representatives or a
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trustee) notify the Trustee in writing of the amounts then due and owing on the
Designated Senior Indebtedness, if any, and only the amounts specified in such
notice to the Trustee shall be paid to the holders of Designated Senior
Indebtedness.
SECTION 8.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any distribution to creditors of the Company in a
liquidation or dissolution of the Company or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Company or its
property, an assignment for the benefit of creditors or any marshaling of the
Company's assets and liabilities, the holders of Senior Indebtedness will be
entitled to receive payment in full in cash or Marketable Securities of all
Obligations due in respect of such Senior Indebtedness (including interest after
the commencement of any such proceeding at the rate specified in the applicable
Senior Indebtedness) before the holders of Securities will be entitled to
receive any payment with respect to the Securities, and until all Obligations
with respect to Senior Indebtedness are paid in full in cash or Marketable
Securities, any distribution to which the holders of Securities would be
entitled shall be made to the holders of Senior Indebtedness (except that
holders of Securities may receive Permitted Junior Securities and payments made
from the defeasance trust described under Section 9.04).
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Company of any kind or character, whether in cash, property
or securities, shall be received by the Trustee or any holder of Securities at a
time when such payment or distribution is prohibited by Section 8.03(a) and
before all obligations in respect of Senior Indebtedness are paid in full in
cash or Marketable Securities, or payment provided for, such payment or
distribution shall be received and held for the benefit of, and shall be paid
over or delivered to, the holders of Senior Indebtedness (pro rata to such
holders on the basis of the respective amounts of Senior Indebtedness held by
such holders) or their respective representatives, or to the trustee or trustees
or agent or agents under any indenture pursuant to which any of such Senior
Indebtedness may have been issued, as their respective interests may appear, for
application to the payment of Senior Indebtedness remaining unpaid until all
such Senior Indebtedness has been paid in full in cash or Marketable Securities
after giving effect to any prior or concurrent payment, distribution or
provision therefor to or for the holders of such Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company
with or into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided in Article Five shall not be deemed a dissolution, winding-
up, liquidation or reorganization for the purposes of this Section 8.03 if such
other corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article Five.
SECTION 8.04. Subrogation.
Upon the payment in full in cash or Marketable Securities of all
Senior Indebtedness, or provision for payment, the holders of the Securities
shall be subrogated to the rights of the holders of Senior Indebtedness to
receive payments or distributions of cash, property or securities of the Company
made on such Senior Indebtedness until the principal of and interest and
Liquidated Damages, if any, on the Securities shall be paid in full in cash;
and, for the purposes of such subrogation, no payments or distributions to the
holders of the Senior Indebtedness of any cash, property or securities to which
the holders of the Securities or the Trustee
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on their behalf would be entitled except for the provisions of this Article
Eight, and no payment over pursuant to the provisions of this Article Eight to
the holders of Senior Indebtedness by holders of the Securities or the Trustee
on their behalf shall, as between the Company, its creditors other than holders
of Senior Indebtedness, and the holders of the Securities, be deemed to be a
payment by the Company to or on account of the Senior Indebtedness. It is
understood that the provisions of this Article Eight are and are intended solely
for the purpose of defining the relative rights of the holders of the
Securities, on the one hand, and the holders of the Senior Indebtedness, on the
other hand.
If any payment or distribution to which the holders of the Securities
would otherwise have been entitled but for the provisions of this Article Eight
shall have been applied, pursuant to the provisions of this Article Eight, to
the payment of all amounts payable under Senior Indebtedness, then and in such
case, the holders of the Securities shall be entitled to receive from the
holders of such Senior Indebtedness any payments or distributions received by
such holders of Senior Indebtedness in excess of the amount required to make
payment in full, or provision for payment, of such Senior Indebtedness.
SECTION 8.05. Obligations of Company Unconditional.
Nothing contained in this Article Eight or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company and
the holders of the Securities, the obligation of the Company, which is absolute
and unconditional, to pay to the holders of the Securities the principal of and
interest and Liquidated Damages, if any, on the Securities as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the holders of the Securities and
creditors of the Company other than the holders of the Senior Indebtedness, nor
shall anything herein or therein prevent the holder of any Security or the
Trustee on their behalf from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article Eight of the holders of the Senior Indebtedness in respect of
cash, property or securities of the Company received upon the exercise of any
such remedy.
Without limiting the generality of the foregoing, nothing contained in
this Article Eight shall restrict the right of the Trustee or the holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Senior Indebtedness then due
and payable shall first be paid in full before the holders of the Securities or
the Trustee are entitled to receive any direct or indirect payment from the
Company of principal of or interest or Liquidated Damages, if any, on the
Securities.
SECTION 8.06. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee in respect of the Securities pursuant to the provisions of this
Article Eight. The Trustee shall not be charged with knowledge of the existence
of any event of default with respect to any Senior Indebtedness or of any other
facts which would prohibit the making of any payment to or by the Trustee unless
and until the Trustee shall have received notice in writing at its Corporate
Trust Office to that effect signed by an Officer of the Company, or by a holder
of Senior Indebtedness or trustee or agent therefor; and prior to the receipt of
any such written notice, the Trustee shall, subject to Article Seven, be
entitled to assume that no such facts exist; provided that if the Trustee shall
not have received the notice provided for in this Section 8.06 at least two
Business Days prior to the date upon which by the terms of this Indenture any
moneys shall become payable for any purpose (including, without limitation, the
payment of the principal of or interest or Liquidated Damages, if any, on any
Security), then, regardless of anything herein to the contrary, the Trustee
shall have full power and authority to receive any moneys from the Company and
to apply the same to the purpose for which they were received, and shall not be
affected by any notice to the con-
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trary which may be received by it on or after such prior date. Nothing contained
in this Section 8.06 shall limit the right of the holders of Senior Indebtedness
to recover payments as contemplated by Section 8.03. The Trustee shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself or itself to be a holder of any Senior Indebtedness (or a
trustee on behalf of, or other representative of, such holder) to establish that
such notice has been given by a holder of such Senior Indebtedness or a trustee
or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that any
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 Eight, 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 any other facts pertinent to the
rights of such Person under this Article Eight, 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.
SECTION 8.07. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities referred to
in this Article Eight, the Trustee and the Holders of the Securities shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Securities for the purpose of ascertaining the Persons entitled to participate
in such 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 Eight.
SECTION 8.08. Trustee's Relation to Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article Eight with respect to any Senior Indebtedness which
may at any time be held by it in its individual or any other capacity to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of its rights as
such holder.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Eight, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness. The Trustee shall not
be liable to any such holders if the Trustee shall in good faith mistakenly pay
over or distribute to Holders of Securities or to the Company or to any other
person cash, property or securities to which any holders of Senior Indebtedness
shall be entitled by virtue of this Article Eight or otherwise.
SECTION 8.09. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness.
No right of any present or future holders of any Senior Indebtedness
to enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may
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have or otherwise be charged with. The provisions of this Article Eight are
intended to be for the benefit of, and shall be enforceable directly by, the
holders of Senior Indebtedness.
SECTION 8.10. Securityholders Authorize Trustee to Effectuate Subordination of
Securities.
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on its or his behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article Eight, and appoints the Trustee its or his attorney-in-
fact for such purposes, including, in the event of any dissolution, winding-up,
liquidation or reorganization of the Company (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an assignment for
the benefit of creditors or otherwise) tending towards liquidation of the
business and assets of the Company, the filing of a claim for the unpaid balance
of its or his Securities in the form required in those proceedings.
SECTION 8.11. This Article Not to Prevent Events of Default.
The failure to make a payment on account of principal of or interest
or Liquidated Damages, if any, on the Securities by reason of any provision of
this Article Eight shall not be construed as preventing the occurrence of an
Event of Default specified in clause (i) or (ii) of Section 6.01.
SECTION 8.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article Eight shall apply to amounts due to the
Trustee pursuant to other sections in this Indenture. SECTION 8.13. No Waiver of
Subordination Provisions.
Without in any way limiting the generality of Section 8.09, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the Securities and without
impairing or releasing the subordination provided in this Article Eight or the
obligations hereunder of the Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (a) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, Senior
Indebtedness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding or secured; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (c) release any Person liable in any manner for the collection of
Senior Indebtedness; and (d) exercise or refrain from exercising any rights
against the Company and any other Person.
SECTION 8.14. Subordination Provisions Not Applicable to Collateral Held in
Trust for Securityholders; Payments May Be Paid Prior to
Dissolution.
All money and United States Government Obligations deposited in trust
with the Trustee pursuant to and in accordance with Article Nine shall be for
the sole benefit of the Holders and shall not be subject to this Article Eight.
Nothing contained in this Article Eight or elsewhere in this Indenture
shall prevent (i) the Company, except under the conditions described in Section
8.02, from making payments of principal of and interest and Liquidated Damages,
if any, on the Securities, or from depositing with the Trustee any moneys for
such payments or from effecting a termination of the Company's and the
Guarantor's obligations under the Secu-
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rities and this Indenture as provided in Article Nine, or (ii) the application
by the Trustee of any moneys deposited with it for the purpose of making such
payments of principal of and interest and Liquidated Damages, if any, on the
Securities, to the Holders entitled thereto unless at least two Business Days
prior to the date upon which such payment becomes due and payable, the Trustee
shall have received the written notice provided for in Section 8.02(b) or in
Section 8.06. The Company shall give prompt written notice to the Trustee of any
dissolution, winding-up, liquidation or reorganization of the Company.
SECTION 8.15. Acceleration of Securities.
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of the Senior Indebtedness of
the acceleration.
ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture.
The Company and the Guarantors may terminate their Obligations under
the Securities, the Guarantees and this Indenture, except the obligations
referred to in the last paragraph of this Section 9.01, if there shall have been
cancelled by the Trustee or delivered to the Trustee for cancellation all
Securities theretofore authenticated and delivered (other than any Securities
that are asserted to have been destroyed, lost or stolen and that shall have
been replaced as provided in Section 2.07) and the Company has paid all sums
payable by it hereunder or deposited all required sums with the Trustee.
After such delivery or irrevocable deposit and after delivery of an
Officers' Certificate and Opinion of Counsel as described below, the Trustee
upon request shall acknowledge in writing the discharge of the Company's and the
Guarantors' Obligations under the Securities, the Guarantees and this Indenture
except for those surviving obligations specified below.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company and the Guarantor in Sections 7.07, 9.05 and 9.06
shall survive.
SECTION 9.02. Legal Defeasance.
The Company may at its option, by resolution of the Board of
Directors, be discharged from its Obligations with respect to the Securities and
the Guarantors discharged from their Obligations under the Guarantees on the
date the conditions set forth in Section 9.04 below are satisfied (hereinafter,
the "Legal Defeasance Option"). For this purpose, exercise of such Legal
-----------------------
Defeasance Option means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Securities and to have
satisfied all its other Obligations under such Securities and this Indenture
insofar as such Securities are concerned (and the Trustee, at the expense of the
Company, shall, subject to Section 9.06 hereof, execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of
outstanding Securities to receive solely from the trust funds described in
Section 9.04 and as more fully set forth in such Section, payments in respect of
the principal of and premium, if any, and interest and Liquidated Damages, if
any, on such Securities when such payments are due, (B) the Com-
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pany's obligations with respect to such Securities under Sections 2.03, 2.04 and
2.07, (C) the rights, powers, trusts, duties, and immunities of the Trustee
hereunder (including claims of, or payments to, the Trustee under or pursuant to
Section 7.07 hereof) and (D) this Article Nine. Subject to compliance with this
Article Nine, the Company may exercise its Legal Defeasance Option under this
Section 9.02 with respect to the Securities notwithstanding the prior exercise
of its option under Section 9.03 with respect to the Securities. If the Company
exercises its Legal Defeasance Option, payment of the Securities may not be
accelerated because of an Event of Default with respect thereto.
SECTION 9.03. Covenant Defeasance.
At the option of the Company, pursuant to a resolution of the Board of
Directors, the Company and the Guarantors shall be released from their
respective Obligations under any covenant contained in Article Four (except for
obligations mandated by the TIA), clauses (iv) and (v) of paragraph (a) and
clauses (ii) and (iii) of paragraph (c) of Xxxxxxx 0.00, xxx xxxxxxxxxx (x),
(x), (x), (x) and, with respect to Significant Subsidiaries only, (g) and (h) of
Section 6.01, with respect to the outstanding Securities on and after the date
the conditions set forth in Section 9.04 hereof are satisfied (hereinafter,
"Covenant Defeasance Option"). For this purpose, exercise of such Covenant
---------------------------
Defeasance Option means that the Company and the Guarantors may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such specified Section or portion thereof, whether directly or
indirectly by reason of any reference elsewhere herein to any such specified
Section or portion thereof or by reason of any reference in any such specified
Section or portion thereof to any other provision herein or in any other
document, but the remainder of this Indenture and the Securities shall be
unaffected thereby. If the Company exercises the Covenant Defeasance Option,
payment of the Securities shall not be accelerated because of an Event of
Default specified in paragraphs (c), (d), (e), (f) or, with respect to
Significant Subsidiaries only, (g) of Section 6.01 or because of the Company's
failure to comply with clauses (iv) and (v) under paragraph (a) of Section 5.01
and clauses (ii) and (iii) under paragraph (c) of Section 5.01.
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to application of Section 9.02
or Section 9.03 hereof to the outstanding Securities:
(1) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 who shall agree to comply with the provisions of this
Article Nine applicable to it) as funds in trust (the "defeasance trust")
----------------
for the purpose of making the following payments, specifically pledged as
security for, and dedicated solely to, the benefit of the Holders of the
Securities, (A) money in an amount, or (B) U.S. Government Obligations
which through the scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not later than the due
date of any payment, money in an amount, or (C) a combination thereof,
sufficient, in the opinion of a nationally-recognized firm of independent
public accountants expressed in a written certification thereof delivered
to the Trustee, to pay and discharge, and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, the principal
of and premium, if any, and accrued interest and Liquidated Damages, if
any, on the outstanding Securities on the Maturity Date of such principal
of or premium, if any, or interest, or Liquidated Damages, if any, or on
dates for payment and redemption of such principal and premium, if any, and
interest and Liquidated Damages, if any, selected in accordance with the
terms of this Indenture and of the Securities;
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(2) no Event of Default or Default with respect to the Securities
shall have occurred and be continuing on the date of such deposit, or shall
have occurred and be continuing at any time during the period ending on the
91st day after the date of such deposit or, if longer, ending on the day
following the expiration of the longest preference period under any
Bankruptcy Law applicable to the Company in respect of such deposit (it
being understood that this condition shall not be deemed satisfied until
the expiration of such period);
(3) such Legal Defeasance Option or Covenant Defeasance Option
shall not cause the Trustee to have a conflicting interest for purposes of
the TIA with respect to any securities of the Company;
(4) such Legal Defeasance Option or Covenant Defeasance Option
shall not result in a breach or violation of, or constitute default under
any other agreement or instrument to which the Company is a party or by
which it is bound;
(5) the Company shall have delivered to the Trustee an Opinion of
Counsel stating that, as a result of such Legal Defeasance Option or
Covenant Defeasance Option, neither the trust nor the Trustee will be
required to register as an investment company under the Investment Company
Act of 1940, as amended;
(6) the Company shall have delivered to the Trustee an Opinion of
Counsel stating that after the 91st day after the date of such deposit (or
such greater period referred to in (2) above), the trust funds will not be
subject to the effect of any applicable Bankruptcy Law;
(7) in the case of an election under Section 9.02 above, the
Company shall have delivered to the Trustee an Opinion of Counsel stating
that (i) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling to the effect that or (ii) there has been
a change in any applicable federal income tax law with the effect that, and
such opinion shall confirm that, the Holders of the outstanding Securities
or Persons in their positions will not recognize income, gain or loss for
federal income tax purposes solely as a result of such deposit in the
defeasance trust or the exercise of the Legal Defeasance Option and will be
subject to federal income tax on the same amount, in the same manner and at
the same times as would have been the case if such deposit in the
defeasance trust or the exercise of the Legal Defeasance Option had not
occurred;
(8) in the case of an election under Section 9.03 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel to the
effect that the Holders of the outstanding Securities or Persons in their
positions will not recognize income, gain or loss for federal income tax
purposes solely as a result of such deposit in the defeasance trust or the
exercise of the Covenant Defeasance Option and will be subject to federal
income tax on the same amount, in the same manner and at the same times as
would have been the case if such deposit in the defeasance trust or the
exercise of the Covenant Defeasance Option had not occurred;
(9) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Legal Defeasance Option under
Section 9.02 or the Covenant Defeasance Option under Section 9.03 (as the
case may be) have been complied with;
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(10) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause (1) was not made by the
Company with the intent of defeating, hindering, delaying or defrauding any
creditors of the Company or others; and
(11) the Company shall have paid or duly provided for payment under
terms mutually satisfactory to the Company and the Trustee all amounts then
due to the Trustee pursuant to Section 7.07 hereof.
SECTION 9.05. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 9.04 hereof in respect
of the outstanding Securities shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become due
thereon in respect of principal, premium, if any, accrued interest and
Liquidated Damages, if any, but such money need not be segregated from other
funds except to the extent required by law.
The Company and the Guarantors shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 9.04 or the principal,
premium, if any, and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders of the
outstanding Securities.
Anything in this Article Nine to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 9.04 which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent Legal Defeasance Option or
Covenant Defeasance Option.
SECTION 9.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 9.01, 9.02 or 9.03 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 and the Guarantors' Obligations under this Indenture,
the Securities and the Guarantees shall be revived and reinstated as though no
deposit had occurred pursuant to this Article Nine until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 9.01; provided, however, that if the
Company or any Guarantor has made any payment of principal of, premium, if any,
accrued interest or Liquidated Damages, if any, on any Securities because of the
reinstatement of their Obligations, the Company or any Guarantor, as the case
may be, shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
SECTION 9.07. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be paid to the
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Trustee, or if sufficient moneys have been deposited pursuant to Section 9.01
hereof, to the Company (or, if such moneys had been deposited by any Guarantor,
to such Guarantor), and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.
SECTION 9.08. Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent or then held
by the Company or any Guarantor in trust for the payment of the principal of, or
premium, if any, interest or Liquidated Damages, if any, on any Security that
are not applied but remain unclaimed by the Holder of such Security for two
years after the date upon which the principal of, or premium, if any, interest
or Liquidated Damages, if any, on such Security shall have respectively become
due and payable shall be repaid to the Company (or, if appropriate, the
Guarantor) upon Company Request, or if such moneys are then held by the Company
or any Guarantor in trust, such moneys shall be released from such trust; and
the Holder of such Security entitled to receive such payment shall thereafter,
as an unsecured general creditor, look only to the Company and such Guarantor
for the payment thereof, and all liability of the Trustee or such Paying Agent
with respect to such trust money shall thereupon cease; provided, however, that
the Trustee or any such Paying Agent, before being required to make any such
repayment, may, at the expense of the Company and such Guarantor, either mail to
each Securityholder affected, at the address shown in the Register, or cause to
be published once a week for two successive weeks, in a newspaper published in
the English language, customarily published each Business Day and of general
circulation in The City of New York, New York, a notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such mailing or publication, any unclaimed balance of
such moneys then remaining will be repaid to the Company or such Guarantor.
After payment to the Company or such Guarantor or the release of any money held
in trust by the Company or such Guarantor, as the case may be, Securityholders
entitled to the money must look only to the Company and such Guarantor for
payment as general creditors unless applicable abandoned property law designates
another Person.
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.
The Company and the Guarantors, when authorized by a resolution of the
Board of Directors and the boards of directors of the Guarantors, and the
Trustee may amend or supplement this Indenture or the Securities without notice
to or consent of any Securityholder:
(i) to cure any ambiguity, defect or inconsistency;
(ii) to provide for uncertificated Securities in addition to or in
place of Certificated Securities or to alter the provisions of Article Two
(including the related definitions) in a manner that does not materially
adversely affect any Holder;
(iii) to provide for the assumption by a successor Person of the
obligations of the Company to the Holders of Securities under the
Securities, this Indenture and the Registration Rights Agreement in
connection with any transaction complying with Article Five of this
Indenture;
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(iv) to add further Guarantees with respect to the Securities;
(v) to release Guarantors when permitted by the Indenture;
(vi) to secure the Securities;
(vii) to add to the covenants of the Company and any Subsidiary of
the Company for the benefit of the Holders of the Securities or to
surrender any right or power conferred upon the Company or any Subsidiary
of the Company;
(viii) to comply with any requirements of the Commission in order
to effect or maintain the qualification of this Indenture under the TIA; or
(ix) to make any change that does not materially adversely affect
the legal rights of any Holder under this Indenture;
provided, however, that the Company shall deliver to the Trustee an Opinion of
Counsel stating that such amendment or supplement complies with the provisions
of this Section 10.01. Subject to Section 10.06, upon the request of the
Company, the Trustee shall join with the Company in the execution of any amended
or supplemental Indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations that may be
therein contained.
SECTION 10.02. With Consent of Holders.
Subject to Section 6.07, the Company and the Guarantors, when
authorized by a resolution of the Boards of Directors and the boards of
directors of the Guarantors, and the Trustee may amend or supplement this
Indenture or the Securities with the written consent of the Holders of at least
a majority in principal amount of the outstanding Securities. Subject to
Section 6.07, the Holders of a majority in principal amount of the outstanding
Securities may waive compliance by the Company or the Guarantors with any
provision of this Indenture or the Securities and may waive any existing Default
or Event of Default (other than a payment default). However, without the
consent of each Securityholder affected, an amendment, supplement or waiver may
not:
(i) reduce the principal amount of any Securities whose Holders
must consent to an amendment to this Indenture or a waiver under this
Indenture;
(ii) reduce the rate of or change the interest payment time on any
Security or alter the redemption provisions with respect thereto (including
the redemption provisions relating to Sections 4.05, 4.14 and 5.01(b),
other than any alteration to any such Section which would not materially
adversely affect the legal rights of any Holder under this Indenture) or
the price at which the Company is required to offer to purchase the
Securities;
(iii) reduce the principal of or change the fixed maturity of any
Security;
(iv) change currency of payment of the principal of or interest on
any Security;
(v) modify any provision of Section 4.01, 6.04, 6.07 or 8.05;
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(vi) waive any default in the payment of the principal of, premium,
if any, or unpaid interest on, and Liquidated Damages, if any, with respect
to the Securities;
(vii) make any change to Article Eight or Twelve of this Indenture
or paragraph 11 of the Securities in a manner that materially adversely
affects the legal rights of any Holder of the Securities; or
(viii) release any Guarantor from its obligations under any
Guarantee, other than in accordance with this Indenture.
It shall not be necessary for the consent of the Holders under this
Section 10.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 10.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amendment, supplement or
waiver.
SECTION 10.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
SECTION 10.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder is a continuing consent by the Holder and every subsequent Holder of that
Security or portion of that Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by written notice to the Trustee or the Company received before the
date on which the waiver, supplement or amendment becomes effective.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders of Securities entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then,
notwithstanding the last sentence of the immediately preceding paragraph, those
persons who were Holders of Securities at such record date (or their duly
designated proxies), and only those persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders of such Securities after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, in
accordance with its terms it shall bind every Securityholder, unless it makes a
change described in any of clauses (i) through (viii) of Section 10.02. In that
case, the amendment, supplement or waiver shall bind 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.
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SECTION 10.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver 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 about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or issue a new Security shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 10.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article Ten if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee,
provided, however, that the Trustee shall be entitled to receive, and (subject
to Section 7.01) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of any amendment, supplement or waiver authorized
pursuant to this Article Ten is authorized or permitted by this Indenture.
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee.
Each Guarantor hereby irrevocably and unconditionally guarantees to
each holder of a Security authenticated by the Trustee and to the Trustee and
its successors and assigns that: the principal of and premium, if any, interest
or Liquidated Damages, if any, on the Securities shall be promptly paid in full
when due, subject to any applicable grace period, whether on the Maturity Date,
by acceleration, call for redemption, upon a Change of Control Offer, upon an
Asset Sale Offer, upon an offer pursuant to paragraph (b) of Section 5.01 or
otherwise, and interest on the overdue principal of and interest on any overdue
interest on the Securities and expenses, indemnification or otherwise, and all
other obligations of the Company (all such obligations guaranteed by the
Guarantor being called herein the "Guaranteed Obligations"), to the Holders or
----------------------
the Trustee hereunder or under the Securities will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; subject,
however, to the limitations set forth in Section 11.03. Each Guarantor hereby
agrees that its obligations hereunder shall be unconditional and continuing,
irrespective of the validity, regularity or enforceability of the Securities or
this Indenture, the absence of any action to enforce the same, any waiver or
consent by any holder of the Securities with respect to any provisions hereof or
thereof, the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of such Guarantor and shall (a) remain in full
force and effect until payment in full of all the Guaranteed Obligations, (b) be
binding upon such Guarantor and its successors, transferees and assigns and (c)
inure to the benefit of and be enforceable by the Trustee, the holders of the
Securities and their successors, transferees and assigns. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenants that the Guarantees will not be discharged except by complete
performance of the Guaranteed Obligations, and this Guarantee. If any Holder or
the Trustee is required by any court or otherwise to return to the Company, any
Guarantor, or any Custodian, trustee, liquidator or other similar official
acting in relation to the Company or
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such Guarantor, any amount paid by the Company or such Guarantor to the Trustee
or such Holder, the Guarantees, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between such Guarantor, on the one hand, and the Holders and the Trustee, on the
other hand, (x) the maturity of the Guaranteed Obligations hereby may be
accelerated as provided in Article Six for the purpose of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Guaranteed Obligations, and (y) in the event of
any acceleration of the Guaranteed Obligations as provided in Article Six, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Guarantor for the purpose of this Guarantee.
SECTION 11.02. Severability.
In case any provision of this Guarantee shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 11.03. Limitation of Guarantor's Liability.
Each Guarantor and, by its acceptance of a Security issued hereunder,
each Holder and the Trustee hereby confirm that it is the intention of all such
parties that the guarantee by the Guarantor pursuant to its Guarantee not
constitute a fraudulent transfer or conveyance for purposes of any Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or any similar U.S. federal or state or other applicable law. To effectuate the
foregoing intention, the Holders and each Guarantor hereby irrevocably agree
that the obligations of each Guarantor under the Guarantees shall be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Guarantor, result in the obligations of such Guarantor
under the Guarantees not constituting such fraudulent transfer or conveyance.
SECTION 11.04. Subordination of Subrogation and Other Rights.
Each Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of such Guarantor's
obligations under the Guarantees or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of such Guarantor shall be made
before, the payment in full in cash of all outstanding Securities in accordance
with the provisions provided therefor in this Indenture.
SECTION 11.05. Execution and Delivery of Guarantee.
To evidence its Guarantee set forth in this Article Eleven, each
Guarantor hereby agrees to execute the Guarantee in substantially the form
included in Exhibits A and B, which shall be endorsed on each Security ordered
to be authenticated and delivered by the Trustee. Each Guarantor hereby agrees
that its Guarantee set forth in this Article Eleven shall remain in full force
and effect notwithstanding any failure to endorse on each Security a notation of
such Guarantee. Each such Guarantee shall be signed on behalf of each Guarantor
by an Officer (who shall have been duly authorized by all requisite corporate
actions), and the delivery of such Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of such
Guarantee on behalf of such Guarantor. Such signatures upon the Guarantee may
be by manual or facsimile signature of such Officer and may be imprinted or
otherwise reproduced on the Guarantee, and in case any such Officer who shall
have signed the Guarantee shall cease to be such Officer before the Security on
which such Guarantee is endorsed shall have been authenticated and delivered by
the Trustee or disposed of by the Company, such Security nevertheless may be
authenticated and delivered or disposed of as though the person who signed the
Guarantee had not ceased to be such Officer of the Guarantor.
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ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor Senior
Indebtedness.
Each Guarantor covenants and agrees, and the Trustee and each holder
of the Securities by its or his acceptance thereof likewise covenants and
agrees, that the Guarantees shall be issued subject to the provisions of this
Article Twelve; and each person holding any Security, whether upon original
issue or upon transfer, assignment or exchange thereof, accepts and agrees that
all payments of the principal of and premium, if any, interest and Liquidated
Damages, if any, on the Securities pursuant to the Guarantees made by or on
behalf of each Guarantor shall, to the extent and in the manner set forth in
this Article Twelve, be subordinated and junior in right of payment to the prior
payment in full in cash or Marketable Securities of all amounts payable under
Senior Indebtedness of each Guarantor.
SECTION 12.02. No Payment on Guarantee in Certain Circumstances.
(a) No direct or indirect payment by or on behalf of any Guarantor of
principal of or premium, if any, or interest or Liquidated Damages, if any, on
the Securities, whether pursuant to the Guaranteed Obligations, the terms of the
Securities, upon acceleration, pursuant to an Asset Sale Offer, Change of
Control Offer, an offer pursuant to paragraph (b) of Section 5.01 or otherwise,
shall be made to the holders of Securities and instead shall be made to the
holders of Senior Indebtedness of such Guarantor (except that holders of
Securities may receive payments made in Permitted Junior Securities or from the
defeasance trust described under Section 9.04) if (i) a default in the payment
of the principal of or premium, if any, or interest on Senior Indebtedness of
such Guarantor occurs and is continuing beyond any applicable period of grace or
(ii) any other default occurs and is continuing with respect to Designated
Guarantor Senior Indebtedness that permits holders of the Designated Guarantor
Senior Indebtedness as to which such default relates to accelerate its maturity
and the Trustee receives a written notice (with a copy to such Guarantor) of
such other default (a "Guarantor Payment Blockage Notice") from such Guarantor
---------------------------------
or the holders of any Designated Guarantor Senior Indebtedness until all
Obligations with respect to such Designated Guarantor Senior Indebtedness are
paid in full; payments on the Securities shall be resumed (a) in the case of a
payment default, upon the date on which such default is cured or waived and (b)
in case of a nonpayment default, the earlier of the date on which such
nonpayment default is cured or waived or 179 days after the date on which the
applicable Guarantor Payment Blockage Notice is received by the Trustee (such
period being referred to herein as the "Guarantor Payment Blockage Period"),
---------------------------------
unless the maturity of any Designated Guarantor Senior Indebtedness has been
accelerated (and written notice of such acceleration has been received by the
Trustee). No nonpayment default that existed or was continuing on the date of
delivery of any Guarantor Payment Blockage Notice to the Trustee shall be, or be
made, the basis for a subsequent Guarantor Payment Blockage Notice (it being
understood that any subsequent action, or any breach of any covenant for a
period commencing after the date of receipt by the Trustee of such Guarantor
Payment Blockage Notice, that, in either case, would give rise to such a default
pursuant to any provisions under which a default previously existed or was
continuing shall constitute a new default for this purpose).
Notwithstanding anything herein or in the Securities to the contrary,
(x) in no event shall a Guarantor Payment Blockage Period extend beyond 179 days
from the date the Guarantor Payment Blockage Notice in respect thereof was
given, (y) there shall be a period of at least 181 consecutive days in each 360-
day period when no Guarantor Payment Blockage Period is in effect and (z) not
more than one Guarantor Payment Blockage Period may be commenced with respect to
the Guarantor during any period of 360 consecutive days.
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No new period of payment blockage may be commenced unless and until all
scheduled payments of principal, premium, if any, and interest on the Guarantees
that have come due have been paid in cash. No nonpayment default that existed or
was continuing on the date of delivery of any Guarantor Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Guarantor
Payment Blockage Notice (it being understood that any subsequent action, or any
breach of any covenant for a period commencing after the date of receipt by the
Trustee of such Guarantor Payment Blockage Notice, that, in either case, would
give rise to such a default pursuant to any provisions under which a default
previously existed or was continuing shall constitute a new default for this
purpose).
(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by Section 12.02(a), such payment shall be held for the benefit of, and shall be
paid over or delivered to, the holders of such Designated Guarantor Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Designated Guarantor Senior
Indebtedness may have been issued, as their respective interests may appear, but
only to the extent that, upon notice from the Trustee to the holders of such
Designated Guarantor Senior Indebtedness that such prohibited payment has been
made, the holders of such Designated Guarantor Senior Indebtedness (or their
representative or representatives or a trustee) notify the Trustee in writing of
the amounts then due and owing on such Designated Guarantor Senior Indebtedness,
if any, and only the amounts specified in such notice to the Trustee shall be
paid to the holders of such Designated Guarantor Senior Indebtedness.
SECTION 12.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any distribution to creditors of any Guarantor in a
liquidation or dissolution of such Guarantor or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Guarantor or its
property, an assignment for the benefit of creditors or any marshaling of the
Guarantor's assets and liabilities, the holders of Senior Indebtedness of such
Guarantor will be entitled to receive payment in full in cash or Marketable
Securities of all Obligations due in respect of the Senior Indebtedness of such
Guarantor (including interest after the commencement of any such proceeding at
the rate specified in the applicable Senior Indebtedness of such Guarantor)
before the holders of Guarantees will be entitled to receive any payment with
respect to the Guarantees, and until all Obligations with respect to Senior
Indebtedness of such Guarantor are paid in full in cash or Marketable
Securities, any distribution to which the holders of Guarantees would be
entitled shall be made to the holders of Senior Indebtedness of such Guarantor
(except that holders of Guarantees may receive Permitted Junior Securities and
payments made from the defeasance trust).
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of any Guarantor of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or any holder of
Securities at a time when such payment or distribution is prohibited by Section
12.03(a) and before all Obligations in respect of the Senior Indebtedness of
such Guarantor are paid in full in cash or Marketable Securities, or payment
provided for, such payment or distribution shall be received and held for the
benefit of, and shall be paid over or delivered to, the holders of the Senior
Indebtedness of such Guarantor (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness of such Guarantor held by such
holders) or their respective representatives, or to the trustee or trustees or
agent or agents under any indenture pursuant to which any of Senior Indebtedness
of such Guarantor may have been issued, as their respective interests may
appear, for application to the payment of the Senior Indebtedness of such
Guarantor remaining unpaid until all Senior Indebtedness of such Guarantor has
been paid in full in cash or Marketable Securities after giving effect to any
prior or concurrent payment, distribution or provision therefor to or for the
holders of Senior Indebtedness of such Guarantor; provided that the
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Trustee shall be entitled to receive from the holders of Senior Indebtedness of
such Guarantor written notice of the amounts owing on the Senior Indebtedness of
such Guarantor.
The consolidation of the Guarantor with, or the merger of the
Guarantor with or into, another corporation or the liquidation or dissolution of
the Guarantor following the conveyance or transfer of its property as an
entirety, or substantially as an entirety, to another corporation upon the terms
and conditions provided in Article Five shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 12.03
if such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article Five.
SECTION 12.04. Subrogation.
Upon the payment in full in cash or Marketable Securities of all
Senior Indebtedness of any Guarantor, or provision for payment, the holders of
the Guarantees shall be subrogated to the rights of the holders of Senior
Indebtedness of such Guarantor to receive payments or distributions of cash,
property or securities of such Guarantor made on Senior Indebtedness of such
Guarantor until the principal of and premium, if any, and interest and
Liquidated Damages, if any, on the Guarantees shall be paid in full in cash;
and, for the purposes of such subrogation, no payments or distributions to the
holders of Senior Indebtedness of such Guarantor of any cash, property or
securities to which the holders of the Securities or the Trustee on their behalf
would be entitled except for the provisions of this Article Twelve, and no
payment over pursuant to the provisions of this Article Twelve to the holders of
the Senior Indebtedness of such Guarantor by holders of the Guarantees or the
Trustee on their behalf shall, as between such Guarantor, its creditors other
than holders of the Senior Indebtedness of such Guarantor, and the holders of
the Securities, be deemed to be a payment by such Guarantor to or on account of
the Senior Indebtedness of such Guarantor. It is understood that the provisions
of this Article Twelve are and are intended solely for the purpose of defining
the relative rights of the holders of the Guarantees, on the one hand, and the
holders of Senior Indebtedness of such Guarantor, on the other hand.
If any payment or distribution to which the holders of the Guarantees
would otherwise have been entitled but for the provisions of this Article Twelve
shall have been applied, pursuant to the provisions of this Article Twelve, to
the payment of all amounts payable under Senior Indebtedness of such Guarantor,
then and in such case, the holders of the Securities shall be entitled to
receive from the holders of Senior Indebtedness of such Guarantor any payments
or distributions received by such holders of Senior Indebtedness of such
Guarantor in excess of the amount required to make payment in full, or provision
for payment, of Senior Indebtedness of such Guarantor.
SECTION 12.05. Obligations of Guarantor Unconditional.
Nothing contained in this Article Twelve or elsewhere in this
Indenture or in the Securities or the Guarantees is intended to or shall impair,
as between any Guarantor and the holders of the Securities, the obligation of
such Guarantor, which is absolute and unconditional, to pay to the holders of
the Securities the principal of and premium, if any, or interest and Liquidated
Damages, if any, on the Securities as and when the same shall become due and
payable in accordance with the terms of the Guarantee, or is intended to or
shall affect the relative rights of the holders of the Securities and creditors
of such Guarantor other than the holders of Senior Indebtedness of such
Guarantor, nor shall anything herein or therein prevent the holder of any
Security or the Trustee on their behalf from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article Twelve of the holders of Senior Indebtedness
of such Guarantor in respect of cash, property or securities of any Guarantor
received upon the exercise of any such remedy.
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Without limiting the generality of the foregoing, nothing contained in
this Article Twelve shall restrict the right of the Trustee or the holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Senior Indebtedness of any
Guarantor then due and payable shall first be paid in full before the holders of
the Securities or the Trustee are entitled to receive any direct or indirect
payment from such Guarantor of principal of or premium, if any, or interest or
Liquidated Damages, if any, on the Securities pursuant to such Guarantor's
Guarantee.
SECTION 12.06. Notice to Trustee.
The Company and each Guarantor shall give prompt written notice to the
Trustee of any fact known to the Company or such Guarantor which would prohibit
the making of any payment to or by the Trustee in respect of the Securities
pursuant to the provisions of this Article Twelve. The Trustee shall not be
charged with knowledge of the existence of any event of default with respect to
any Senior Indebtedness of any Guarantor or of any other facts which would
prohibit the making of any payment to or by the Trustee unless and until the
Trustee shall have received notice in writing at its Corporate Trust Office to
that effect signed by an Officer of the Company or such Guarantor, or by a
holder of Senior Indebtedness of any Guarantor or trustee or agent therefor; and
prior to the receipt of any such written notice, the Trustee shall, subject to
Article Seven, be entitled to assume that no such facts exist; provided that if
the Trustee shall not have received the notice provided for in this Section
12.06 at least two Business Days prior to the date upon which by the terms of
this Indenture any moneys shall become payable for any purpose (including,
without limitation, the payment of the principal of or premium, if any, or
interest or Liquidated Damages, if any, on any Security), then, regardless of
anything herein to the contrary, the Trustee shall have full power and authority
to receive any moneys from such Guarantor and to apply the same to the purpose
for which they were received, and shall not be affected by any notice to the
contrary which may be received by it on or after such prior date. Nothing
contained in this Section 12.06 shall limit the right of the holders of Senior
Indebtedness of any Guarantor to recover payments as contemplated by Section
12.03. The Trustee shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself or itself to be a holder of Senior
Indebtedness of any Guarantor (or a trustee on behalf of, or other
representative of, such holder) to establish that such notice has been given by
a holder of Senior Indebtedness of any Guarantor or a trustee or representative
on behalf of any such holder.
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness of any Guarantor to participate in any payment or
distribution pursuant to this Article Twelve, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness of any Guarantor held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Article Twelve, 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.
SECTION 12.07. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities of any
Guarantor referred to in this Article Twelve, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or upon a certificate of
the receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities for the purpose of ascertaining the Persons entitled to
participate in such distribution, the holders of
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Senior Indebtedness of any Guarantor and other Indebtedness of such Guarantor,
the amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article Twelve.
SECTION 12.08. Trustee's Relation to Senior Indebtedness of Any Guarantor.
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article Twelve with respect to Senior Indebtedness of any
Guarantor which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Indebtedness of any
Guarantor, and nothing in this Indenture shall deprive the Trustee or any Paying
Agent of any of its rights as such holder.
With respect to the holders of Senior Indebtedness of any Guarantor,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article Twelve, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness of any
Guarantor. The Trustee shall not be liable to any such holders if the Trustee
shall in good faith mistakenly pay over or distribute to holders of Securities
or to the Company or to any other person cash, property or securities to which
any holders of Senior Indebtedness of any Guarantor shall be entitled by virtue
of this Article Twelve or otherwise.
SECTION 12.09. Subordination Rights Not Impaired by Acts or Omissions of the
Guarantor or Holders of Senior Indebtedness of any Guarantor.
No right of any present or future holders of Senior Indebtedness of
any Guarantor to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
any Guarantor or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by such Guarantor with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with. The provisions of this Article Twelve are intended
to be for the benefit of, and shall be enforceable directly by, the holders of
Senior Indebtedness of any Guarantor.
SECTION 12.10. Securityholders Authorize Trustee to Effectuate Subordination of
Guarantee.
Each holder of Securities by its acceptance of such Securities
authorizes and expressly directs the Trustee on its or his behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article Twelve, and appoints the Trustee its or his attorney-
in-fact for such purposes, including, in the event of any dissolution, winding-
up, liquidation or reorganization of any Guarantor (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of such Guarantor, the filing of a claim
for the unpaid balance of its or his Securities in the form required in those
proceedings.
SECTION 12.11. This Article Not to Prevent Events of Default.
The failure to make a payment on account of principal of or premium,
if any, or interest or Liquidated Damages, if any, on the Securities by reason
of any provision of this Article Twelve shall not be construed as preventing the
occurrence of an Event of Default specified in clauses (i) or (ii) of Section
6.01.
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SECTION 12.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article Twelve shall apply to amounts due to
the Trustee pursuant to other sections in this Indenture.
SECTION 12.13. No Waiver of Guarantee Subordination Provisions.
Without in any way limiting the generality of Section 12.09, the
holders of Senior Indebtedness of any Guarantor may, at any time and from time
to time, without the consent of or notice to the Trustee or the holders of the
Securities, without incurring responsibility to the holders of the Securities
and without impairing or releasing the subordination provided in this Article
Twelve or the obligations hereunder of the holders of the Securities to the
holders of Senior Indebtedness of any Guarantor, do any one or more of the
following: (a) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Indebtedness of any Guarantor or any
instrument evidencing the same or any agreement under which Senior Indebtedness
of any Guarantor is outstanding or secured; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness of any Guarantor; (c) release any Person liable in any manner for
the collection of Senior Indebtedness of any Guarantor; and (d) exercise or
refrain from exercising any rights against any Guarantor and any other Person.
SECTION 12.14. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article Twelve or elsewhere in this
Indenture shall prevent (i) any Guarantor, except under the conditions described
in Section 12.02, from making payments of principal of and premium, if any, and
interest and Liquidated Damages, if any, on the Securities, or from depositing
with the Trustee any moneys for such payments, or (ii) the application by the
Trustee of any moneys deposited with it for the purpose of making such payments
of principal of and premium, if any, and interest and Liquidated Damages, if
any, on the Securities, to the Holders entitled thereto unless at least two
Business Days prior to the date upon which such payment becomes due and payable,
the Trustee shall have received the written notice provided for in Section
12.02(b) or in Section 12.06. Each Guarantor shall give prompt written notice
to the Trustee of any dissolution, winding-up, liquidation or reorganization of
such Guarantor.
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls.
This Indenture is subject to the provisions of the TIA that are
required to be a part of this Indenture, and shall, to the extent applicable, be
governed by such provisions. If any provision of this Indenture modifies any
TIA provision that may be so modified, such TIA provision shall be deemed to
apply to this Indenture as so modified. If any provision of this Indenture
excludes any TIA provision that may be so excluded, such TIA provision shall be
excluded from this Indenture.
The provisions of TIA (S)(S) 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included unless expressly
excluded by this Indenture) are a part of and govern this Indenture, whether or
not physically contained herein.
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SECTION 13.02. Notices.
Any notice or communication shall be sufficiently given if in writing
and delivered in person, by facsimile and confirmed by overnight courier, or
mailed by first-class mail addressed as follows:
if to the Company or to the Guarantors:
Xxxxxx, Inc.
00 Xxxx Xxxx
X.X. Xxx 00000
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Milbank, Tweed, Xxxxxx & XxXxxx
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, III
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
if to the Trustee:
Marine Midland Bank
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department - Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
The Company or the Trustee by written notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed, first-class, postage prepaid, to a
Holder including any notice delivered in connection with TIA (S) 310(b), TIA (S)
313(c), TIA (S) 314(a) and TIA (S) 315(b), shall be mailed to it or him at its
or his address as set forth in the Register and shall be sufficiently given to
it or him if so mailed within the time prescribed. To the extent required by
the TIA, any notice or communication shall also be mailed to any Person
described in TIA (S) 313(c).
-81-
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. Except for a notice to the Trustee, which is deemed given only
when received, if a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA (S) 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or the Guarantors to
the Trustee to take or refrain from taking any action under this Indenture, the
Company or the Guarantors shall furnish to the Trustee at the request of the
Trustee:
(1) an Officers' Certificate in form and substance 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 satisfactory to the
Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion.
Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, 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
person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
-82-
SECTION 13.07. Governing Law.
The laws of the State of New York shall govern this Indenture, the
Securities and the Guarantees without regard to principles of conflicts of law.
SECTION 13.08. No Recourse Against Others.
No past, present or future officer, employee, director, incorporator
or stockholder (or other Person performing similar functions with respect to a
Person who is not a corporation) of the Company or any Subsidiary of the Company
shall have any liability for any Obligations of the Company under the Series A
Securities, the Guarantees, the Series B Securities and the guarantees thereon
or the Indenture, or for any claim based on, in respect of, or by reason of,
such Obligations or the creation of any such Obligation. Each holder of the
Securities by accepting a Security waives and releases all such liability, and
such waiver and release is part of the consideration for issuance of the Series
A Securities, the Guarantees, the Series B Securities and the guarantees
thereon.
SECTION 13.09. Successors.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Guarantors in this Indenture
and the Guarantees shall bind their respective successor. All agreements of the
Trustee in this Indenture shall bind its successor.
SECTION 13.10. Counterpart 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.
SECTION 13.11. Severability.
In case any provision in this Indenture, in the Securities or in the
Guarantees shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby, and a Holder shall have no claim therefor against any party
hereto.
SECTION 13.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company, any Guarantor or a Subsidiary. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 13.13. Legal Holidays.
If a payment date is a not a Business Day at a place of payment,
payment may be made at that place on the next succeeding Business Day, and no
interest shall accrue for the intervening period.
[Signature Pages Follow]
S-1
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
XXXXXX, INC.,
as Issuer
By:
-----------------------------------
Name:
Title:
XXXXXX PRODUCTS COMPANY,
as Guarantor
By:
-----------------------------------
Name:
Title:
MARINE MIDLAND BANK,
as Trustee
By:
-----------------------------------
Name:
Title:
EXHIBIT A
---------
[FORM OF SERIES A SECURITY]
[LEGEND FOR RESTRICTED SECURITY]
THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN
THE SECOND SENTENCE HEREOF. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL
INTEREST HEREIN, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A
"QIB") OR (B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE
WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT WITHIN
THE TIME PERIOD REFERRED TO UNDER RULE 144(K) (TAKING INTO ACCOUNT THE
PROVISIONS OF RULE 144(D) UNDER THE SECURITIES ACT, IF APPLICABLE) UNDER THE
SECURITIES ACT AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS NOTE, RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QIB
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING
THE REQUIREMENTS OF RULE 903 OR 904 OF THE SECURITIES ACT, (D) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (E) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY)
OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION" AND "UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN
VIOLATION OF THE FOREGOING.
A-1
XXXXXX, INC.
10 3/8% Senior Subordinated Note
due November 1, 2007, Series A
CUSIP No.:
No. [ ] $[ ]
XXXXXX, INC., a Delaware corporation (the "Company", which term
-------
includes any successor corporation), for value received promises to pay to [
] or registered assigns, the principal sum of [ ] Dollars, on November
1, 2007.
Interest Payment Dates: May 1 and November 1, commencing on
May 1, 1998.
Interest Record Dates: April 15 and October 15.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officer.
XXXXXX, INC.
By:
-----------------------------------
Name:
Title:
Attest:
---------------------------
Name:
Title:
A-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 10 3/8% Senior Subordinated Notes due 2007,
Series A, described in the within-mentioned Indenture.
Dated:
MARINE MIDLAND BANK,
as Trustee
By:
---------------------------------
Authorized Signatory
A-3
(REVERSE OF SECURITY)
XXXXXX, INC.
10 3/8% Senior Subordinated Note
due November 1, 2007, Series A
1. Interest.
--------
XXXXXX, INC., a Delaware corporation (the "Company"), promises to pay
-------
interest on the principal amount of this Security at the rate per annum shown
above. Cash 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 November 6,
1997. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing May 1, 1998. 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 from time to time
on demand at the rate borne by the Securities and on overdue installments of
interest (without regard to any applicable grace periods) to the extent lawful.
2. Method of Payment.
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Interest Record Date immediately preceding the Interest Payment Date even
if the Securities are canceled on registration of transfer or registration of
exchange after such Interest Record Date. Holders must surrender Securities to
a Paying Agent to collect principal payments. The Company shall pay principal
and premium, if any, and interest and Liquidated Damages, if any, in money of
the United States that at the time of payment is legal tender for payment of
public and private debts ("U.S. Legal Tender"). However, the Company may pay
-----------------
principal and premium, if any, and interest and Liquidated Damages, if any, by
wire transfer of Federal funds (provided that the Paying Agent shall have
received wire instructions on or prior to the relevant Interest Record Date), or
interest by check payable in such U.S. Legal Tender. The Company may deliver
any such interest payment to the Paying Agent or to a Holder at the Holder's
registered address.
3. Paying Agent and Registrar.
--------------------------
Initially, Marine Midland Bank (the "Trustee") will act as Paying
-------
Agent and Registrar. The Company may change any Paying Agent or Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar.
4. Indenture and Guarantees.
------------------------
The Company issued the Securities under an Indenture, dated as of
November 6, 1997 (the "Indenture"), among the Company, Xxxxxx Products Company,
---------
a Delaware corporation (the "Initial Guarantor"), and in the future certain
-----------------
other subsidiaries of the Company (collectively, the "Guarantors"), and the
----------
Trustee. Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. 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. (S)(S) 77aaa-77bbbb) (the "TIA"), as in effect
---
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Se-
A-4
curities are general obligations of the Company limited in aggregate principal
amount to $150,000,000 of which $100,000,000 in aggregate principal amount is
being offered hereby.
5. Registration Rights.
-------------------
Pursuant to the Registration Rights Agreement, dated as of November 6,
1997 (the "Registration Rights Agreement"), among the Company, the Guarantors
-----------------------------
and Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, as the Initial Purchasers of the Series A
Securities, the Company and the Initial Guarantor will be obligated to
consummate an exchange offer pursuant to which the Holder of this Security shall
have the right to exchange this Security for 10 3/8% Senior Subordinated Notes
due 2007, Series B, of the Company (the "Series B Securities"), which have been
-------------------
registered under the Securities Act, in like principal amount and having
identical terms as the Series A Securities. The Holders of Series A Securities
shall be entitled to receive certain additional payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement. The Series A Securities and the Series B Securities are together
referred to herein as the "Securities."
----------
6. Optional Redemption.
-------------------
The Securities will be redeemable at the option of the Company, in
whole or in part, at any time or from time to time, on or after November 1, 2002
at the redemption prices (expressed as a percentage of principal amount) set
forth below, plus accrued and unpaid interest and Liquidated Damages thereon, if
any, to the Redemption Date if redeemed during the twelve-month period
commencing on November 1 of the years set forth below:
Year Percentage
---- ----------
2002 105.188%
2003 103.458%
2004 101.729%
2005 and thereafter 100.000%
7. Optional Redemption upon Certain Equity Issuances.
--------------------------------------------------
At any time, or from time to time, prior to November 1, 2000, the
Company may redeem up to 35% of the originally issued principal amount of
Securities plus the principal amount of any Subsequent Series Securities at a
redemption price equal to 110.375% of the principal amount of the Securities so
redeemed, plus accrued and unpaid interest and Liquidated Damages thereon, if
any, to the Redemption Date, with the net proceeds of one or more Equity
Offerings; provided, however, that at least 65% of the originally issued
principal amount of Securities plus the principal amount of any Subsequent
Series Securities remains outstanding immediately after giving effect to any
such redemption and provided, further, that such redemption will occur within 90
days of the date of the Closing of such Equity Offering.
8. Notice of Redemption.
--------------------
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at its registered address. The Trustee may select for
redemption portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof.
A-5
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, interest will cease to accrue on Securities or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent for the
Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
9. Change of Control Offer.
-----------------------
Upon the occurrence of a Change of Control, the Company will be
required to offer to purchase all outstanding Securities at a purchase price
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the Change of Control
Purchase Date.
10. Limitation on Disposition of Assets.
-----------------------------------
The Company is, subject to certain conditions, obligated to make an
offer to purchase Securities at a purchase price equal to 100% of the aggregate
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the Asset Sale Purchase Date.
11. Subordination.
-------------
The Indebtedness evidenced by the Securities is, to the extent and in
the manner provided in the Indenture, subordinated and subject in right of
payment to the prior payment in full in cash or Marketable Securities of all
Senior Indebtedness as defined in the Indenture, whether outstanding on the date
of the indenture or thereafter incurred, and this Security is issued subject to
such provisions. Each Holder of this Security, by accepting the same, (a)
agrees to and shall be bound by such provisions, (b) authorizes and directs the
Trustee, on behalf of such Holder, to take such action as may be necessary or
appropriate to effectuate the subordination as provided in the Indenture and (c)
appoints the Trustee attorney-in-fact of such Holder for such purpose.
12. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer or exchange of Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer or
exchange of any Securities or portions thereof selected for redemption, except
the unredeemed portion of any security being redeemed in part.
13. Persons Deemed Owners.
---------------------
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
14. Unclaimed Funds.
---------------
If funds for the payment of principal or premium, if any, or interest
or Liquidated Damages, if any, remain unclaimed for two years, the Trustee and
the Paying Agent will repay the funds to the Company at its written request.
After that, all liability of the Trustee and such Paying Agent with respect to
such funds shall cease.
A-6
15. Legal Defeasance and Covenant Defeasance.
----------------------------------------
The Company and the Guarantors may be discharged from their
obligations under the Indenture, the Securities and the Guarantees except for
certain provisions thereof, and may be discharged from obligations to comply
with certain covenants contained in the Indenture, the Securities and the
Guarantees, in each case upon satisfaction of certain conditions specified in
the Indenture.
16. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default (other than a payment default) or
compliance with any provision may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.
Without notice to or consent of any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Securities to, among other things, cure
any ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of Certificated Securities provide for the assumption by
a successor corporation of the Company's obligations to the Holders of
Securities in the case of a Disposition, add further Guarantees with respect to
the Securities, release Guarantors when permitted by the Indenture, secure the
Securities, add to the covenants of the Company and any Subsidiary of the
Company for the benefit of the Holders of the Securities or surrender any right
or power conferred upon the Company or any Subsidiary of the Company, comply
with any requirements of the Commission in connection with the qualification of
the Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
17. Restrictive Covenants.
---------------------
The Indenture contains certain covenants that, among other things,
limit the ability of the Company and the Restricted Subsidiaries to make
Restricted Payments, to incur Indebtedness, to create Liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
to the Company, to consolidate, merge or sell all or substantially all of its
assets or to engage in transactions with Affiliates. The limitations are
subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.
18. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture, the Securities or the Guarantees except as
provided in the Indenture. The Trustee is not obligated to enforce the
Indenture, the Securities or the Guarantees unless it has received indemnity
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Securities then outstanding to direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of Securities notice of certain
continuing Defaults or Events of Default if it determines that withholding
notice is in their interest.
19. Trustee Dealings with Company.
-----------------------------
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 the Company, its Subsidiaries or their respective Affiliates as if it were
not the Trustee.
A-7
20. No Recourse Against Others.
--------------------------
No past, present or future stockholder (or other person performing
similar functions with respect to a person who is not a corporation), director,
officer, incorporator or employee of the Company or any Subsidiary of the
Company shall 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 the creation of any such Obligation. Each Holder
of a Security by accepting a Security waives and releases all such liability and
such waiver and release is part of the consideration for the issuance of the
Securities.
21. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on this Security.
22. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. 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 as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
24. Governing Law.
-------------
The laws of the State of New York shall govern the Indenture, this
Security and the Guarantees without regard to principles of conflicts of laws.
A-8
[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
Xxxxxx Products Company (the "Initial Guarantor") has unconditionally
-----------------
and irrevocably guaranteed on a senior subordinated basis (such guarantee being
referred to herein as the "Guarantee") (i) the due and punctual payment of the
---------
principal of and interest or premium or Liquidated Damages, if any, on the
Securities, whether on the Maturity Date, by acceleration, call for redemption,
upon a Change of Control Offer, upon an Asset Sale Offer or otherwise, the due
and punctual payment of interest on the overdue principal and interest, if any,
on the Securities and expenses, indemnification or otherwise, and the due and
punctual performance of all other obligations of the Company to the Holders or
the Trustee all in accordance with the terms set forth in Article Eleven and
Article Twelve of the Indenture and (ii) in case of any extension of time of
payment or renewal of any Securities or any of such other obligations, that the
same will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise.
The obligations of the Initial Guarantor to the Holders and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full of all Guarantor Senior Indebtedness of the Initial Guarantor, to the
extent and in the manner provided, in Article Eleven and Article Twelve of the
Indenture, and reference is hereby made to such Indenture for the precise terms
of the Guarantee therein made.
No past, present or future director, officer, incorporator, employee
or stockholder (or other person performing similar functions with respect to a
person who is not a corporation), as such, of the Initial Guarantor shall have
any liability under the Guarantee by reason of such person's status as director,
officer, incorporator, employee or stockholder (or other person performing
similar functions with respect to a person who is not a corporation). Each
holder of a Security by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Guarantee.
The Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Securities upon which the Guarantee is
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
XXXXXX PRODUCTS COMPANY
By:
-----------------------------------
Name:
Title:
A-9
ASSIGNMENT FORM
I or we assign and transfer this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated:___________________ Signed: ______________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:__________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor
program reasonably acceptable to the Trustee)
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.05, Section 4.14 or Section 5.01 of the Indenture, check
the appropriate box:
Section 4.05 [ ]
Section 4.14 [ ]
Section 5.01 [ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.05, Section 4.14 or Section 5.01 of the
Indenture, state the amount: $_____________
Dated:___________________ Your Signature:_________________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:__________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor
program reasonably acceptable to the Trustee)
A-11
(FORM OF SERIES B SECURITY)
XXXXXX, INC.
10 3/8% Senior Subordinated Note
due November 1, 2007, Series B
CUSIP No.:
No. [ ] $[ ]
XXXXXX, INC., a Delaware corporation (the "Company", which term
-------
includes any successor corporation), for value received promises to pay to [
] or registered assigns, the principal sum of [ ] Dollars, on November
1, 2007.
Interest Payment Dates: May 1 and November 1, commencing on
May 1, 1998.
Interest Record Dates: April 15 and October 15.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officer.
XXXXXX, INC.
By:
________________________________
Name:
Title:
Attest:
---------------------------
Name:
Title:
B-1
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 10 3/8% Senior Subordinated Notes due 2007,
Series B, described in the within-mentioned Indenture.
Dated:
MARINE MIDLAND BANK,
as Trustee
By:
---------------------------
Authorized Signatory
B-2
(REVERSE OF SECURITY)
XXXXXX, INC.
10 3/8% Senior Subordinated Note
due November 1, 2007, Series B
1. Interest.
--------
XXXXXX, INC., a Delaware corporation (the "Company"), promises to pay
-------
interest on the principal amount of this Security at the rate per annum shown
above. Cash 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 November 6,
1997. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing May 1, 1998. 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 from time to time
on demand at the rate borne by the Securities and on overdue installments of
interest (without regard to any applicable grace periods) to the extent lawful.
2. Method of Payment.
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Interest Record Date immediately preceding the Interest Payment Date even
if the Securities are canceled on registration of transfer or registration of
exchange after such Interest Record Date. Holders must surrender Securities to
a Paying Agent to collect principal payments. The Company shall pay principal
and premium, if any, and interest and Liquidated Damages, if any, in money of
the United States that at the time of payment is legal tender for payment of
public and private debts ("U.S. Legal Tender"). However, the Company may pay
-----------------
principal and premium, if any, and interest and Liquidated Damages, if any, by
wire transfer of Federal funds (provided that the Paying Agent shall have
received wire instructions on or prior to the relevant Interest Record Date), or
interest by check payable in such U.S. Legal Tender. The Company may deliver
any such interest payment to the Paying Agent or to a Holder at the Holder's
registered address.
3. Paying Agent and Registrar.
--------------------------
Initially, Marine Midland Bank (the "Trustee") will act as Paying
-------
Agent and Registrar. The Company may change any Paying Agent or Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar.
4. Indenture and Guarantees.
------------------------
The Company issued the Securities under an Indenture, dated as of
November 6, 1997 (the "Indenture"), among the Company, Xxxxxx Products Company,
---------
a Delaware corporation (the "Initial Guarantor"), and in the future certain
-----------------
other subsidiaries of the Company (collectively, the "Guarantors"), and the
----------
Trustee. Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. 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. (S)(S) 77aaa-77bbbb) (the "TIA"), as in effect
---
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Se-
B-3
curities are general obligations of the Company limited in aggregate principal
amount to $150,000,000 of which $100,000,000 in aggregate principal amount is
being offered hereby.
5. Exchange Offer.
--------------
The Series B Securities were issued pursuant to an exchange offer
pursuant to which 10 3/8% Senior Subordinated Notes due 2007, Series A, of the
Company (the "Series A Securities"), in like principal amount and having
-------------------
substantially identical terms as the Series B Securities, were exchanged for the
Series B Securities. The Series A Securities and the Series B Securities are
together referred to herein as the "Securities."
----------
6. Optional Redemption.
-------------------
The Securities will be redeemable at the option of the Company, in
whole or in part, at any time or from time to time, on or after November 1, 2002
at the redemption prices (expressed as a percentage of principal amount) set
forth below, plus accrued and unpaid interest and Liquidated Damages thereon, if
any, to the Redemption Date if redeemed during the twelve-month period
commencing on November 1 of the years set forth below:
Year Percentage
--- ----------
2002 105.188%
2003 103.458%
2004 101.729%
2005 and thereafter 100.000%
7. Optional Redemption upon Certain Equity Issuances.
--------------------------------------------------
At any time, or from time to time, prior to November 1, 2000, the
Company may redeem up to 35% of the originally issued principal amount of
Securities plus the principal amount of any Subsequent Series Securities at a
redemption price equal to 110.375% of the principal amount of the Securities so
redeemed, plus accrued and unpaid interest and Liquidated Damages thereon, if
any, to the Redemption Date, with the net proceeds of one or more Equity
Offerings; provided, however, that at least 65% of the originally issued
principal amount of Securities plus the principal amount of any Subsequent
Series Securities remains outstanding immediately after giving effect to any
such redemption and provided, further, that such redemption will occur within 90
days of the date of the Closing of such Equity Offering.
8. Notice of Redemption.
--------------------
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at its registered address. The Trustee may select for
redemption portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, interest will cease to accrue on Securities or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent for the
Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
9. Change of Control Offer.
-----------------------
B-4
Upon the occurrence of a Change of Control, the Company will be
required to offer to purchase all outstanding Securities at a purchase price
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the Change of Control
Purchase Date.
10. Limitation on Disposition of Assets.
-----------------------------------
The Company is, subject to certain conditions, obligated to make an
offer to purchase Securities at a purchase price equal to 100% of the aggregate
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the Asset Sale Purchase Date.
11. Subordination.
-------------
The Indebtedness evidenced by the Securities is, to the extent and in
the manner provided in the Indenture, subordinated and subject in right of
payment to the prior payment in full in cash or Marketable Securities of all
Senior Indebtedness as defined in the Indenture, whether outstanding on the date
of the indenture or thereafter incurred, and this Security is issued subject to
such provisions. Each Holder of this Security, by accepting the same, (a)
agrees to and shall be bound by such provisions, (b) authorizes and directs the
Trustee, on behalf of such Holder, to take such action as may be necessary or
appropriate to effectuate the subordination as provided in the Indenture and (c)
appoints the Trustee attorney-in-fact of such Holder for such purpose.
12. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer or exchange of Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer or
exchange of any Securities or portions thereof selected for redemption, except
the unredeemed portion of any security being redeemed in part.
13. Persons Deemed Owners.
---------------------
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
14. Unclaimed Funds.
---------------
If funds for the payment of principal or premium, if any, or interest
or Liquidated Damages, if any, remain unclaimed for two years, the Trustee and
the Paying Agent will repay the funds to the Company at its written request.
After that, all liability of the Trustee and such Paying Agent with respect to
such funds shall cease.
15. Legal Defeasance and Covenant Defeasance.
----------------------------------------
The Company and the Guarantors may be discharged from their
obligations under the Indenture, the Securities and the Guarantee except for
certain provisions thereof, and may be discharged from obligations to comply
with certain covenants contained in the Indenture, the Securities and the
Guarantees, in each case upon satisfaction of certain conditions specified in
the Indenture.
16. Amendment; Supplement; Waiver.
-----------------------------
B-5
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default (other than a payment default) or
compliance with any provision may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.
Without notice to or consent of any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Securities to, among other things, cure
any ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of Certificated Securities provide for the assumption by
a successor corporation of the Company's obligations to the Holders of
Securities in the case of a Disposition, add further Guarantees with respect to
the Securities, release Guarantors when permitted by the Indenture, secure the
Securities, add to the covenants of the Company and any Subsidiary of the
Company for the benefit of the Holders of the Securities or surrender any right
or power conferred upon the Company or any Subsidiary of the Company, comply
with any requirements of the Commission in connection with the qualification of
the Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
17. Restrictive Covenants.
---------------------
The Indenture contains certain covenants that, among other things,
limit the ability of the Company and the Restricted Subsidiaries to make
Restricted Payments, to incur Indebtedness, to create Liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
to the Company, to consolidate, merge or sell all or substantially all of its
assets or to engage in transactions with Affiliates. The limitations are
subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.
18. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture, the Securities or the Guarantees except as
provided in the Indenture. The Trustee is not obligated to enforce the
Indenture, the Securities or the Guarantees unless it has received indemnity
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Securities then outstanding to direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of Securities notice of certain
continuing Defaults or Events of Default if it determines that withholding
notice is in their interest.
19. Trustee Dealings with Company.
-----------------------------
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 the Company, its Subsidiaries or their respective Affiliates as if it were
not the Trustee.
20. No Recourse Against Others.
--------------------------
No past, present or future stockholder (or other person performing
similar functions with respect to a person who is not a corporation), director,
officer, incorporator or employee of the Company or any Subsidiary of the
Company shall 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 the creation of any such Obligation. Each Holder
of a Security by accepting a Security waives and releases all such liability and
such waiver and release is part of the consideration for the issuance of the
Securities.
B-6
21. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on this Security.
22. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. 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 as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
24. Governing Law.
-------------
The laws of the State of New York shall govern the Indenture, this
Security and the Guarantees without regard to principles of conflicts of laws.
B-7
[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
Xxxxxx Products Company (the "Initial Guarantor") has unconditionally
-----------------
and irrevocably guaranteed on a senior subordinated basis (such guarantee being
referred to herein as the "Guarantee") (i) the due and punctual payment of the
---------
principal of and interest or premium or Liquidated Damages, if any, on the
Securities, whether on the Maturity Date, by acceleration, call for redemption,
upon a Change of Control Offer, upon an Asset Sale Offer or otherwise, the due
and punctual payment of interest on the overdue principal and interest, if any,
on the Securities and expenses, indemnification or otherwise, and the due and
punctual performance of all other obligations of the Company to the Holders or
the Trustee all in accordance with the terms set forth in Article Eleven and
Article Twelve of the Indenture and (ii) in case of any extension of time of
payment or renewal of any Securities or any of such other obligations, that the
same will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise.
The obligations of the Initial Guarantor to the Holders and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full of all Guarantor Senior Indebtedness of the Initial Guarantor, to the
extent and in the manner provided, in Article Eleven and Article Twelve of the
Indenture, and reference is hereby made to such Indenture for the precise terms
of the Guarantee therein made.
No past, present or future director, officer, incorporator, employee
or stockholder (or other person performing similar functions with respect to a
person who is not a corporation), as such, of the Initial Guarantor shall have
any liability under the Guarantee by reason of such person's status as director,
officer, incorporator, employee or stockholder (or other person performing
similar functions with respect to a person who is not a corporation). Each
holder of a Security by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of the Guarantee.
The Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Securities upon which the Guarantee is
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
XXXXXX PRODUCTS COMPANY
By:___________________________
Name:
Title:
B-8
ASSIGNMENT FORM
I or we assign and transfer this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
-------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated:___________________ Signed: ______________________________
(Signed exactly as name
appears on the other side of
this Security)
Signature Guarantee: _________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor
program reasonably acceptable to the Trustee)
B-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.05, Section 4.14 or Section 5.01 of the Indenture, check
the appropriate box:
Section 4.05 [ ]
Section 4.14 [ ]
Section 5.01 [ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.05, Section 4.14 or Section 5.01 of the
Indenture, state the amount: $_____________
Dated:___________________ Your Signature:______________________________
(Signed exactly as name appears
on the other side of this
Security)
Signature Guarantee:__________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor
program reasonably acceptable to the Trustee)
B-10
EXHIBIT C
---------
FORM OF LEGEND FOR GLOBAL SECURITIES
Any Global Security authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS
SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A
NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
C-1
EXHIBIT D
---------
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
Re: 10 3/8% Senior Subordinated Notes due 2007, Series A
and 10 3/8% Senior Subordinated Notes due 2007, Series B
(the "Securities"), of Xxxxxx, Inc.
-----------------------------------------------
This Certificate relates to $_______ principal amount of Securities
held in the form of* ___ a beneficial interest in a Global Security or* _______
Certificated Securities by ______ (the "Transferor").
The Transferor:*
[ ] has requested by written order that the Registrar deliver in
exchange for its beneficial interest in the Global Security held by the
Depository a Certificated Security or Certificated Securities in definitive,
registered form of authorized denominations and an aggregate number equal to its
beneficial interest in such Global Security (or the portion thereof indicated
above); or
[ ] has requested that the Registrar by written order to exchange
or register the transfer of a Certificated Security or Certificated Securities.
In connection with such request and in respect of each such Security,
the Transferor does hereby certify that the Transferor is familiar with the
Indenture relating to the above captioned Securities and the restrictions on
transfers thereof as provided in Section 2.07 of such Indenture, and that the
transfer of this Securities does not require registration under the Securities
Act of 1933, as amended (the "Act"), because*:
[ ] Certified Security is being acquired for the Transferor's own
account, without transfer (in satisfaction of Section 2.07 of the Indenture).
[ ] Such Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the Act), in reliance on
Rule 144A.
[ ] Such Security is being transferred in reliance on Regulation S
under the Act
[ ] Such Security is being transferred in reliance on Rule 144
under the Act. An opinion of counsel to the effect that such transfer does not
require registration under the Act accompanies this Certificate.
[ ] Such Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the Act other
than Rule 144A or Rule 144 or Regulation S under the Act to a person other than
an institutional "accredited investor." An opinion of counsel to the effect
that such transfer does not require registration under the Act accompanies this
Certificate.
______________________________
[INSERT NAME OF TRANSFEROR]
By: __________________________
[Authorized Signatory]
Date: _____________
*Check applicable box.
D-1
EXHIBIT E
---------
Form of Certificate To Be
Delivered in Connection
with Regulation S Transfers
_______________, ____
Marine Midland Bank
000 Xxxxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department - Xxxxxx
Re: Xxxxxx, Inc. (the "Company") 10 3/8%
Senior Subordinated Notes due 2007, Series A, and 10 3/8%
Senior Subordinated Notes due 2007, Series B (the "Securities")
---------------------------------------------------------------
Ladies and Gentlemen:
In connection with our proposed sale of $____________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. An opinion of counsel to the effect that
such transfer does not require registration under the Act accompanies this
Certificate. Defined terms used herein without definition have the respective
meanings provided in Regulation S.
Very truly yours,
[Name of Transferor]
By: _________________________
[Authorized Signatory]
E-1
