EXECUTION COPY
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AMF BOWLING WORLDWIDE, INC.
$150,000,000
13.00% SENIOR SUBORDINATED NOTES DUE 2008
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INDENTURE
Dated as of February 28, 2002
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WILMINGTON TRUST COMPANY,
TRUSTEE
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CROSS-REFERENCE TABLE*
Trust Indenture Indenture Section
Act Section
310 (a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)................................................. 7.10
(c)................................................. N.A.
311 (a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312 (a)................................................. 2.05
(b)................................................. 14.03
(c)................................................. 14.03
313 (a)................................................. 7.06
(b)(1).............................................. N.A.
(b)(2).............................................. 7.06; 7.07
(c)................................................. 7.06; 14.02
(d)................................................. 7.06
314 (a)................................................. 4.03
(b)................................................. N.A.
(c)(1).............................................. 14.04
(c)(2).............................................. 14.04
(c)(3).............................................. N.A.
(d)................................................. N.A.
(e)................................................. 14.05
(f)................................................. N.A.
315 (a)................................................. 7.01
(b)................................................. 7.05; 14.02
(c)................................................. 7.01
(d)................................................. 7.01
(e)................................................. 6.11
316 (a)(last sentence).................................. 2.09
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
(c)................................................. 9.04
317 (a)(1).............................................. 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.04
318 (a)................................................. 14.01
(b)................................................. N.A.
(c)................................................. 14.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS....................................1
SECTION 1.02. OTHER DEFINITIONS.............................20
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST
INDENTURE ACT.................................20
SECTION 1.04. RULES OF CONSTRUCTION.........................21
ARTICLE 2.
THE NOTES
SECTION 2.01. FORM AND DATING...............................21
SECTION 2.02. EXECUTION AND AUTHENTICATION..................23
SECTION 2.03. REGISTRAR AND PAYING AGENT....................24
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST...........24
SECTION 2.05. HOLDER LISTS..................................24
SECTION 2.06. TRANSFER AND EXCHANGE.........................25
SECTION 2.07. REPLACEMENT NOTES.............................27
SECTION 2.08. OUTSTANDING NOTES.............................27
SECTION 2.09. TREASURY NOTES................................27
SECTION 2.10. TEMPORARY NOTES...............................28
SECTION 2.11. CANCELLATION..................................28
SECTION 2.12. DEFAULTED INTEREST............................28
SECTION 2.13. CUSIP NUMBERS.................................28
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TABLE OF CONTENTS
(continued)
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE............................29
SECTION 3.02. SELECTION OF NOTES 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. NOTES REDEEMED IN PART........................31
SECTION 3.07. OPTIONAL REDEMPTION...........................31
SECTION 3.08. MANDATORY REDEMPTION..........................32
SECTION 3.09. OFFER TO PURCHASE NOTES.......................32
ARTICLE 4.
COVENANTS
SECTION 4.01. PAYMENT OF NOTES..............................34
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY...............34
SECTION 4.03. REPORTS.......................................34
SECTION 4.04. COMPLIANCE CERTIFICATE........................35
SECTION 4.05. TAXES.........................................35
SECTION 4.06. STAY, EXTENSION AND USURY LAWS................36
SECTION 4.07. RESTRICTED PAYMENTS...........................36
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS
AFFECTING SUBSIDIARIES........................38
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE
OF PREFERRED STOCK............................39
SECTION 4.10. ASSET SALES...................................41
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TABLE OF CONTENTS
(continued)
SECTION 4.11. TRANSACTIONS WITH AFFILIATES..................42
SECTION 4.12. LIENS.........................................43
SECTION 4.13. LINE OF BUSINESS..............................43
SECTION 4.14. CORPORATE EXISTENCE...........................44
SECTION 4.15. OFFER TO PURCHASE UPON A CHANGE OF CONTROL
TRIGGERING EVENT..............................44
SECTION 4.16. ANTI-LAYERING.................................45
SECTION 4.17. SALE AND LEASEBACK TRANSACTIONS...............45
SECTION 4.18. LIMITATION ON ISSUANCES AND SALES OF
CAPITAL STOCK OF RESTRICTED
SUBSIDIARIES..................................45
SECTION 4.19. PAYMENTS FOR CONSENT..........................46
SECTION 4.20. ADDITIONAL GUARANTIES.........................46
SECTION 4.21. RATING BY RATING AGENCIES.....................46
ARTICLE 5.
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS......46
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.............47
ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.............................48
SECTION 6.02. ACCELERATION..................................49
SECTION 6.03. OTHER REMEDIES................................49
SECTION 6.04. WAIVER OF PAST DEFAULTS.......................50
SECTION 6.05. CONTROL BY MAJORITY...........................50
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TABLE OF CONTENTS
(continued)
SECTION 6.06. LIMITATION ON SUITS...........................50
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO
RECEIVE PAYMENT...............................51
SECTION 6.08. COLLECTION SUIT BY TRUSTEE....................51
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM..............51
SECTION 6.10. PRIORITIES....................................52
SECTION 6.11. UNDERTAKING FOR COSTS.........................52
ARTICLE 7.
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.............................52
SECTION 7.02. RIGHTS OF TRUSTEE.............................53
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE..................54
SECTION 7.04. TRUSTEE'S DISCLAIMER..........................54
SECTION 7.05. NOTICE OF DEFAULTS............................54
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS
OF THE NOTES..................................55
SECTION 7.07. COMPENSATION AND INDEMNITY....................55
SECTION 7.08. REPLACEMENT OF TRUSTEE........................56
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC..............57
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.................57
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS
AGAINST ISSUER................................57
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TABLE OF CONTENTS
(continued)
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR
COVENANT DEFEASANCE...........................57
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE................57
SECTION 8.03. COVENANT DEFEASANCE...........................58
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT
DEFEASANCE....................................58
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT
OBLIGATIONS TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS................60
SECTION 8.06. REPAYMENT TO ISSUER...........................60
SECTION 8.07. REINSTATEMENT.................................60
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES...........61
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES..............61
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT...........62
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.............63
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES..............63
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC...............63
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TABLE OF CONTENTS
(continued)
ARTICLE 10.
DISCHARGE OF INDENTURE
SECTION 10.01. TERMINATION OF ISSUER'S OBLIGATIONS...........64
SECTION 10.02. APPLICATION OF TRUST MONEY....................65
SECTION 10.03. REPAYMENT TO ISSUER...........................65
SECTION 10.04. REINSTATEMENT.................................65
ARTICLE 11.
SUBORDINATION
SECTION 11.01. AGREEMENT TO SUBORDINATE......................66
SECTION 11.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY..........66
SECTION 11.03. DEFAULT ON DESIGNATED SENIOR DEBT.............66
SECTION 11.04. ACCELERATION OF NOTES.........................67
SECTION 11.05. WHEN DISTRIBUTION MUST BE PAID OVER...........67
SECTION 11.06. NOTICE BY THE ISSUER..........................68
SECTION 11.07. SUBROGATION...................................68
SECTION 11.08. RELATIVE RIGHTS...............................68
SECTION 11.09. SUBORDINATION MAY NOT BE IMPAIRED
BY THE ISSUER.................................69
SECTION 11.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE......69
SECTION 11.11. RIGHTS OF TRUSTEE AND PAYING AGENT............70
SECTION 11.12. AUTHORIZATION TO EFFECT SUBORDINATION.........70
SECTION 11.13. AMENDMENTS....................................71
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TABLE OF CONTENTS
(continued)
ARTICLE 12.
GUARANTY OF NOTES
SECTION 12.01. NOTE GUARANTY.................................71
SECTION 12.02. EXECUTION AND DELIVERY OF NOTE GUARANTY.......72
SECTION 12.03. SUBSIDIARY GUARANTORS MAY CONSOLIDATE,
ETC., ON CERTAIN TERMS........................72
SECTION 12.04. RELEASES FOLLOWING SALE OF ASSETS, MERGER,
SALE OF CAPITAL STOCK, ETC....................73
SECTION 12.05. ADDITIONAL SUBSIDIARY GUARANTORS..............73
SECTION 12.06. LIMITATION ON SUBSIDIARY
GUARANTOR LIABILITY...........................74
SECTION 12.07. "TRUSTEE" TO INCLUDE PAYING AGENT.............74
ARTICLE 13.
SUBORDINATION OF NOTE GUARANTY
SECTION 13.01. AGREEMENT TO SUBORDINATE......................74
SECTION 13.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY..........74
SECTION 13.03. DEFAULT ON DESIGNATED SENIOR DEBT.............75
SECTION 13.04. ACCELERATION OF NOTES.........................76
SECTION 13.05. WHEN DISTRIBUTION MUST BE PAID OVER...........76
SECTION 13.06. NOTICE BY SUBSIDIARY GUARANTOR................77
SECTION 13.07. SUBROGATION...................................77
SECTION 13.08. RELATIVE RIGHTS...............................77
SECTION 13.09. SUBORDINATION MAY NOT BE IMPAIRED
BY SUBSIDIARY GUARANTOR.......................77
SECTION 13.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE......78
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TABLE OF CONTENTS
(continued)
SECTION 13.11. RIGHTS OF TRUSTEE AND PAYING AGENT............79
SECTION 13.12. AUTHORIZATION TO EFFECT SUBORDINATION.........79
SECTION 13.13. AMENDMENTS....................................79
ARTICLE 14.
MISCELLANEOUS
SECTION 14.01. TRUST INDENTURE ACT CONTROLS..................80
SECTION 14.02. NOTICES.......................................80
SECTION 14.03. COMMUNICATION BY HOLDERS OF NOTES WITH
OTHER HOLDERS OF NOTES........................81
SECTION 14.04. CERTIFICATE AND OPINION AS TO
CONDITIONS PRECEDENT..........................81
SECTION 14.05. STATEMENTS REQUIRED IN CERTIFICATE
OR OPINION....................................82
SECTION 14.06. RULES BY TRUSTEE AND AGENTS...................82
SECTION 14.07. NO PERSONAL LIABILITY OF DIRECTORS,
OFFICERS, EMPLOYEES AND
STOCKHOLDERS..................................82
SECTION 14.08. GOVERNING LAW.................................82
SECTION 14.09. NO ADVERSE INTERPRETATION OF
OTHER AGREEMENTS..............................82
SECTION 14.10. SUCCESSORS....................................83
SECTION 14.11. SEVERABILITY..................................83
SECTION 14.12. COUNTERPART ORIGINALS.........................83
SECTION 14.13. TABLE OF CONTENTS, HEADINGS, ETC..............83
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TABLE OF CONTENTS
(continued)
SCHEDULES
Schedule A INITIAL SUBSIDIARY GUARANTORS
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF SUBSIDIARY GUARANTY
Exhibit C FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of February 28, 2002 among AMF Bowling Worldwide,
Inc., a Delaware corporation (the "Issuer"), the direct and indirect
subsidiaries of the Issuer set forth on Schedule A hereto, as guarantors (the
"Initial Subsidiary Guarantors"), and Wilmington Trust Company, a Delaware
banking corporation (hereinafter, the "Trustee").
RECITALS
WHEREAS, the Issuer has previously entered into a Fourth Amended and
Restated Credit Agreement dated as of June 14, 1999 (as amended, the
"Pre-Petition Senior Credit Agreement") with a group of banks and other
financial institutions, in connection with which Citibank, N.A. acted as
administrative agent, Citicorp USA, Inc. acted as collateral agent, Xxxxxxx
Xxxxx Credit Partners L.P. and Citicorp Securities, Inc. acted as Arrangers and
Xxxxxxx Sachs Credit Partners L.P. acted as Syndication Agent, such Agreement
providing for the making of loans to, and the issuance of letters of credit for
the account of, the Issuer;
WHEREAS, on July 2, 2001, AMF Group Holdings, Inc., the Issuer and
certain of the Issuer's subsidiaries (collectively, the "Debtors") filed with
the Court (such term and other capitalized terms used in these recitals without
definition having the meanings ascribed to them in Article I of this Indenture)
voluntary petitions for relief under the Bankruptcy Code, such proceedings being
jointly administered under Case No. 01-6119 (DHA);
WHEREAS, the Court has confirmed the Debtors' Second Amended Second
Modified Plan of Reorganization which provides, inter alia, for the holders of
the claims arising in connection with the Pre-Petition Senior Credit Agreement
to receive, in partial satisfaction of their claims thereunder, Notes of the
Issuer with an aggregate stated principal amount of $150,000,000, all as set
forth in the Plan of Reorganization and Disclosure Statement related thereto;
and
WHEREAS, the Plan of Reorganization contemplates that such Notes will
be issued pursuant to and governed by an indenture and related documentation;
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the Issuer, the Subsidiary Guarantors
and the Trustee agree as follows for the benefit of each other, and for the
equal and ratable benefit of the Holders of the 13.00% Senior Subordinated Notes
due 2008 to be issued hereunder pursuant to the Plan of Reorganization (the
"Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01. DEFINITIONS.
"Accrued Bankruptcy Interest" means, with respect to any Indebtedness
or Hedging Obligations under or secured by the New Credit Facility, all interest
accruing thereon after the filing of a petition by or against the Issuer under
any Bankruptcy Law, in accordance with and at the rate (including any rate
applicable upon any default or event of default, to the extent lawful) specified
in the documents evidencing or governing such Indebtedness or Hedging
Obligations,
whether or not the claim for such interest is allowed as a claim
after such filing in any proceeding under such Bankruptcy Law.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person to the extent of the
fair market value of such asset where the Indebtedness so secured is not the
Indebtedness of such Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, 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.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depository that apply to such transfer or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets (excluding any sale and leaseback transaction, the
granting of a Permitted Lien, and the transfer of cash and Cash Equivalents)
other than sales in the ordinary course of business, sales, transfers or other
dispositions in the ordinary course of business of worn out, obsolete or surplus
equipment, licensing of intellectual property in the ordinary course of business
and leasing of premises and related assets in the ordinary course of business,
but including, however, a Receivables Transaction (provided, however, that the
sale, lease, conveyance or other disposition of all or substantially all of the
assets of the Issuer and its Restricted Subsidiaries taken as a whole will be
governed by Section 4.15 and/or Article 5 hereof and not by Section 4.10), and
(ii) the issue or sale by the Issuer or any of its Restricted Subsidiaries of
Equity Interests of any of the Issuer's Restricted Subsidiaries, in the case of
either clause (i) or (ii), whether in a single transaction or a series of
related transactions for Net Proceeds in excess of $25.0 million.
Notwithstanding anything otherwise to the contrary, none of the following shall
be deemed to be an Asset Sale: (i) a transfer of assets by the Issuer to a
Restricted Subsidiary or by a Restricted Subsidiary to the Issuer or to another
Restricted Subsidiary, (ii) an issuance of Equity Interests by a Restricted
Subsidiary to the Issuer or to another Restricted Subsidiary; (iii) Hedging
Obligations; (iv) a Restricted Payment that is permitted by Section 4.07; (v)
any sale of an Equity Interest in, or Indebtedness or other securities of, an
Unrestricted Subsidiary; (vi) foreclosures on assets; (vii) sales, assignments,
transfers or other dispositions of accounts in the ordinary course of business
for purposes of collection; (viii) any transaction referred to in the last
paragraph of Section 4.10 hereof; and (ix) any transaction pursuant to the
Reorganization.
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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 Code" means Title 11, U.S. Code.
"Bankruptcy Law" means the Bankruptcy Code or any similar federal or
state law for the relief of debtors, as amended from time to time.
"Beneficial Owner" means "beneficial owner" as such term is defined in
Rule 13d-3 and Rule 13d-5 under the Exchange Act; provided, however, that a
Person shall not be deemed to have beneficial ownership of securities subject to
a stock purchase agreement, merger agreement, or similar agreement until the
consummation of the transactions contemplated by such agreement.
"Board of Directors" means the Board of Directors of the Issuer or any
Subsidiary Guarantor or any authorized committee of the Board of Directors.
"Business Day" means any day except a Saturday, Sunday or other day in
the City of New York, or in the city of the principal corporate trust office of
the Trustee, on which banks are authorized to close.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof (provided that the full faith
and credit of the United States of America is pledged in support thereof), or,
with respect to any Foreign Subsidiary, an equivalent obligation of the
government of the country in which such Foreign Subsidiary transacts business,
(iii) time deposits and certificates of deposit, including eurodollar time
deposits, and, with respect to any Foreign Subsidiary, time deposits in the
currency of any country in which such Foreign Subsidiary transacts business, of
any commercial bank organized in the United States having capital and surplus in
excess of $100,000,000 or, with respect to any Foreign Subsidiary, a commercial
bank organized under the laws of any other country in which such Foreign
Subsidiary transacts business having total assets in excess of $100,000,000 (or
its foreign currency equivalent), in each case with a maturity date not more
than one year from the date of
-3-
acquisition, (iv) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (i) and (ii)
above entered into with any bank meeting the qualifications specified in clause
(iii) above and organized in the United States, (v) direct obligations issued by
any state of the United States of America or any political subdivision of any
state or any public instrumentality thereof maturing within 90 days after the
date of acquisition thereof and, at the time of acquisition, having one of the
two highest ratings obtainable from either Standard & Poor's Corporation or
Xxxxx'x Investors Service, Inc. (or, if at any time neither Standard & Poor's
Corporation nor Xxxxx'x Investors Service, Inc. shall be rating such
obligations, then from such other nationally recognized rating service
reasonably acceptable to the Trustee), (vi) commercial paper issued by the
parent corporation of any commercial bank organized in the United States having
capital and surplus in excess of $100,000,000 or, with respect to any Foreign
Subsidiary, a commercial bank organized under the laws of any other country in
which such Foreign Subsidiary transacts business having total assets in excess
of $100,000,000 (or its foreign currency equivalent), and commercial paper
issued by others having one of the two highest ratings obtainable from either
Standard & Poor's Corporation or Xxxxx'x Investors Service, Inc. (or, if at any
time neither Standard & Poor's Corporation nor Xxxxx'x Investors Service, Inc.
shall be rating such obligations, then from such other nationally recognized
rating services reasonably acceptable to the Trustee) and in each case maturing
within one year after the date of acquisition, (vii) overnight bank deposits and
bankers' acceptances at any commercial bank organized in the United States
having capital and surplus in excess of $100,000,000 or, with respect to any
Foreign Subsidiary, a commercial bank organized under the laws of any other
country in which such Foreign Subsidiary transacts business having total assets
in excess of $100,000,000 (or its foreign currency equivalent), (viii) deposits
available for withdrawal on demand with commercial banks organized in the United
States having capital and surplus in excess of $50,000,000 or, with respect to
any Foreign Subsidiary, a commercial bank organized under the laws of any other
country in which such Foreign Subsidiary transacts business having total assets
in excess of $50,000,000 (or its foreign currency equivalent), and (ix)
investments in money market funds substantially all of whose assets comprise
securities of the types described in clauses (i) through (viii).
"Change of Control" means an event whereby (i) any Person or Group (as
such term is defined in Rule 13d-5 of the Exchange Act) of related Persons
(other than a Wholly Owned Restricted Subsidiary or a member of the Initial
Control Group or, in each case, an Affiliate thereof) acquires all or
substantially all of the Issuer's assets; or (ii) any Person or Group (other
than a Wholly Owned Restricted Subsidiary or a member of the Initial Control
Group or, in each case, an Affiliate thereof) acquires, by way of merger,
consolidation, other business combination or otherwise, in excess of 50% of the
total voting power entitled to vote in the election of directors, managers, or
trustees of the Issuer or such other Person surviving the transaction; or (iii)
during any period of two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors of the Issuer (together with any
new directors whose election by such Board of Directors or whose nomination for
election by the shareholders of the Issuer was approved by a vote of at least a
majority of the directors then still in office who were either directors at the
beginning of such period or whose election for nomination was previously so
approved or any new directors who were nominated to serve on behalf of the
Initial Control Group) cease for any reason to constitute a majority of the
Board of Directors of the Issuer then in office.
-4-
"Change of Control Triggering Event" means the occurrence of both a
Change of Control and a Rating Decline.
"Commission" or "SEC" means the Securities and Exchange Commission and
any successor agency thereof.
"Consolidated Interest Coverage Ratio" means, at any date, the ratio
of (i) the aggregate amount of EBITDA of the Issuer and its Restricted
Subsidiaries for the four full fiscal quarters for which financial information
in respect thereof is available immediately prior to the Transaction Date to
(ii) the aggregate amount of Consolidated Interest Expense of the Issuer and its
Restricted Subsidiaries for such period; provided, that if the Transaction Date
occurs at a time when financial information in respect of the Issuer and its
Restricted Subsidiaries is not available for four full fiscal quarters beginning
after the consummation of the Reorganization, then Consolidated Interest Expense
shall be determined by annualizing, in accordance with accepted financial
practices, the Consolidated Interest Expense for such fiscal quarters for which
such financial information is available. In addition to and without limitation
of the foregoing, for purposes of this definition, "EBITDA" and "Consolidated
Interest Expense" shall be calculated after giving effect on a pro forma basis
for the period of such calculation to (i) the incurrence (excluding any
borrowing or reborrowing under the New Credit Facility to the extent the
proceeds of such borrowing or reborrowing are not for capital expenditures) of
any Indebtedness during the Reference Period, (ii) the repayment of any
Indebtedness during the Reference Period with the proceeds of any Indebtedness
referred to in the immediately preceding clause (i) or the proceeds from the
sale or other disposition of assets referred to in clause (iv) below, (iii) the
acquisition during the Reference Period of any other Person which, as a result
of such acquisition, becomes a Restricted Subsidiary or a Restricted Subsidiary
of a Restricted Subsidiary or the acquisition of assets during the Reference
Period from any Person which constitutes all or substantially all of an
operating unit or business of such Person and (iv) any sale or other disposition
of assets or properties outside the ordinary course of business occurring during
the Reference Period, as if such incurrence, repayment, acquisition, sale or
disposition occurred on the first day of the Reference Period; provided that to
the extent that this sentence requires that pro forma effect be given to an
acquisition of, or an acquisition of all or substantially all of an operating
unit or business from, any Person, such pro forma calculation shall be based
upon the four full fiscal quarters of such Person or operating unit or business
for which financial information is available immediately preceding such
acquisition.
"Consolidated Interest Expense" means, for any period, the sum of (i)
interest in respect of Indebtedness of the Issuer and its Restricted
Subsidiaries (including, without limitation, original issue discount on any such
Indebtedness, the interest portion of any deferred payment obligation in
accordance with the effective interest method of accounting, all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financings and the net cost associated with Hedging
Obligations of the Issuer and its Restricted Subsidiaries relating to interest
rate hedging or exposure, in each case to the extent attributable to such
period) determined on a consolidated basis in accordance with GAAP (except as
set forth herein) and (ii) dividend or other required periodic payments for such
period in respect of Disqualified Stock held by Persons other than the Issuer or
a Wholly Owned Restricted Subsidiary. Interest in respect of a Capital Lease
Obligation shall be deemed to accrue at an interest rate reasonably determined
in good faith by the chief financial officer or the
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chief accounting officer of the Issuer to be the rate of interest implicit
in such Capital Lease Obligation in accordance with GAAP (including Statement of
Financial Accounting Standards No. 13 of the Financial Accounting Standards
Board). Except for purposes of the definition of "EBITDA," in calculating
"Consolidated Interest Expense" (A) unless clause (B) of this definition
applies, interest on Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall be
deemed to have been accrued during the Reference Period at a rate per annum
equal to the rate of interest on such Indebtedness in effect on the Transaction
Date, (B) if interest on any Indebtedness incurred on the Transaction Date may
optionally be determined at an interest rate based upon a factor of a prime or
similar rate, a eurocurrency interbank offered rate, or other rates, then the
interest rate based upon the eurocurrency interbank offered rate first in effect
during such period shall be deemed to have been in effect at all times during
the Reference Period and (C) notwithstanding clause (A) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such interest is
covered by an agreement relating to interest rate hedging or exposure, shall be
deemed to accrue at the rate per annum resulting after giving effect to the
operation of such agreement. Notwithstanding any of the foregoing, "Consolidated
Interest Expense" shall not include (i) any amortization of any issuance costs
of any Indebtedness and (ii) any amounts in respect of Reorganization Expenses
or any amortization thereof.
"Consolidated Net Income" means, with respect to any Person for any
period, 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 (excluding, however, the effect of the Reorganization and of any other
extraordinary transaction in connection with the issuance of the Notes, and the
consummation of the recapitalization of the Issuer in connection therewith);
provided that (i) 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 with
respect to current or prior years' Net Income (if not previously distributed or
dividended) paid in cash to the referent Person or a Restricted Subsidiary
thereof; (ii) the Net Income of any Restricted Subsidiary that is not a
Subsidiary Guarantor 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 (that 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; (iii) the cumulative effect of a
change in accounting principles shall be excluded; and (iv) the Net Income of
any Unrestricted Subsidiary shall be excluded, whether or not distributed to the
Issuer or one of its Subsidiaries except as set forth in (i).
"Consolidated Net Worth" means, (A) with respect to any partnership,
the common and preferred partnership equity of such partnership and its
consolidated subsidiaries, as determined on a consolidated basis in accordance
with GAAP, and (B) with respect to any other Person as of any date, the sum of
(i) the consolidated equity of the common equity holders of such Person and its
consolidated Subsidiaries as of such date plus (ii) the respective amounts
reported on such Person's balance sheet as of such date with respect to any
series of preferred equity (other than Disqualified Stock) that by its terms is
not entitled to the payment of dividends unless such dividends may be declared
and paid only out of net earnings in respect of the year of such declaration and
payment, but only to the extent of any cash received by such Person upon
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issuance of such preferred stock, less (x) all write-ups (other than write-ups
resulting from foreign currency translations and write-ups of tangible assets of
a going concern business made within 12 months after the acquisition of such
business) subsequent to the date of this Indenture in the book value of any
asset owned by such Person or a consolidated Subsidiary of such Person, (y) all
investments as of such date in unconsolidated Subsidiaries and in Persons that
are not Subsidiaries (except, in each case, Permitted Investments), plus (z) all
unamortized debt discount and expense and unamortized deferred charges as of
such date, all of the foregoing determined in accordance with GAAP.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 14.02 hereof or such other address as to which the
Trustee may give notice to the Issuer.
"Court" shall mean the U.S. Bankruptcy Court for the Eastern District
of Virginia, Richmond Division, in which the Debtors' Chapter 11 Cases were
jointly administered.
"Credit Agent" means Bankers Trust Company in its capacity as
Administrative Agent for the lenders party to the New Credit Facility, or any
successor thereto or any Person otherwise appointed.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Definitive Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A, that do not include the information called for by
footnote 1.
"Depository" means, with respect to the Notes issuable or issued in
whole or in part as Global Notes, the Person specified in Section 2.03 hereof as
the Depository with respect to the Notes, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depository" shall mean or include such successor.
"Designated Senior Debt" means (i) any Indebtedness outstanding under
the New Credit Facility and (ii) any other Senior Debt the outstanding principal
amount of which is $25 million or more and that has been designated by the
Issuer as Designated Senior Debt.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the Holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Notes mature.
"EBITDA" means, for any period, the sum of Consolidated Net Income for
such period, plus, to the extent otherwise reflected in the calculation of
Consolidated Net Income, without duplication, (i) Consolidated Interest Expense
for such period, (ii) provision for taxes, (iii) depreciation and amortization
expense for such period, (iv) non-cash foreign exchange losses for such period,
(v) extraordinary or non-recurring losses for such period and (vi) to the extent
not already included in (i) through (v) above, Reorganization Expenses and any
amortization thereof, minus the sum of (vii) all extraordinary gains and
non-recurring gains realized by the Issuer and its Restricted Subsidiaries for
such period and (viii) non-cash foreign
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exchange gains and other non-operating income, if any, included in
determining such Consolidated Net Income for such period, all as determined on a
consolidated basis in accordance with GAAP (except for items referred to in
clauses (v) and (vi) above).
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means up to $10 million in aggregate principal
amount of Indebtedness of the Issuer and its Restricted Subsidiaries (other than
Indebtedness under the New Credit Facility and Indebtedness incurred pursuant to
the Plan), in existence on the date of this Indenture, until all such amounts
are repaid.
"Foreign Subsidiary" means any Subsidiary of the Issuer either (a)
which is organized outside of the United States of America, (b) whose principal
activities are conducted outside of the United States of America or (c) whose
only material assets are Equity Interests in Subsidiaries which are Foreign
Subsidiaries.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.
"Global Note" means a Note that contains the paragraph referred to in
footnote 1 to the form of Note attached hereto as Exhibit A.
"Guarantor Senior Debt" means Senior Debt of a Subsidiary Guarantor.
"Guaranty" means a guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate or currency swap agreements,
interest rate or currency cap agreements, interest rate or currency collar
agreements and (ii) other agreements or arrangements designed to protect such
Person against or expose such Person to fluctuations in interest rates and/or
currency exchange rates.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person, without duplication,
any indebtedness of such Person, 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
banker's acceptances or representing Capital Lease Obligations or the balance
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deferred and unpaid of the purchase price of any property, except any such
balance that constitutes an accrued expense or trade payable, if and to the
extent any of the foregoing indebtedness (other than letters of credit) would
appear as a liability upon a balance sheet of such Person prepared in accordance
with GAAP, as well as all Indebtedness of others secured by a Lien on any asset
of such Person (whether or not such Indebtedness is assumed by such Person) to
the extent of the fair market value of such asset where the Indebtedness so
secured is not the Indebtedness of such Person and, to the extent not otherwise
included, the Guaranty by such Person of any Indebtedness of any other Person,
provided, however that Indebtedness shall not include any obligations incurred
by the Issuer and its Subsidiaries of obligations under repurchase arrangements
in connection with the financing by lenders and leasing companies of bowling
equipment sales. The amount of any Indebtedness outstanding as of any date shall
be (i) the accreted value thereof, to the extent such Indebtedness does not
require current payments of interest, and (ii) the principal amount thereof,
together with any interest thereon that is more than 30 days past due, in the
case of any other Indebtedness. Notwithstanding anything in this Indenture to
the contrary, Hedging Obligations shall not constitute Indebtedness,
except to the extent they appear on the balance sheet of the Issuer.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Control Group" means any Person or Group, or any Affiliate
thereof, which immediately after the consummation of the Reorganization
beneficially owns at least 10% of the outstanding common stock of the Issuer.
"Insolvency or Liquidation Proceedings" means (i) any insolvency or
bankruptcy case or proceeding, or any receivership, liquidation, reorganization
or other similar case or proceeding, relative to the Issuer or to the creditors
of the Issuer, as such, or to the assets of the Issuer, or (ii) any liquidation,
dissolution, reorganization or winding up of the Issuer, whether voluntary or
involuntary and involving insolvency or bankruptcy, or (iii) any assignment for
the benefit of creditors or any other marshalling of assets and liabilities of
the Issuer.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including Guaranties of Indebtedness or other obligations but
excluding Guaranties issued in compliance with this Indenture), advances or
capital contributions (excluding advances to officers and employees made in the
ordinary course of business), purchases or other acquisitions for consideration
of Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a balance sheet prepared in
accordance with GAAP, provided, however that Investments shall not include any
obligations incurred by the Issuer and its Subsidiaries of obligations under
repurchase arrangements in connection with the financing by lenders and leasing
companies of bowling equipment sales. If the Issuer or any Restricted Subsidiary
of the Issuer sells or otherwise disposes of any Equity Interests of any direct
or indirect Restricted Subsidiary of the Issuer such that, after giving effect
to any such sale or disposition, such Person is no longer a Restricted
Subsidiary of the Issuer or another Restricted Subsidiary, the Issuer shall be
deemed to have made an Investment on the date of any such sale
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or disposition equal to the fair market value of the Equity Interests of
such Subsidiary not sold or disposed of in an amount determined as provided in
the final paragraph of Section 4.07 hereof. A provision in an agreement relating
to the purchase or sale of any of the Issuer's or its Restricted Subsidiaries'
assets containing an "earn out" or providing for an adjustment to the purchase
or sale price based on a financial statement relating to the assets purchased or
sold shall not be deemed to be an "Investment."
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
"Letter of Credit Obligations" means all Obligations in respect of
Indebtedness of the Issuer or any of its Restricted Subsidiaries with respect to
letters of credit issued pursuant to the New Credit Facility, which Indebtedness
shall be deemed to consist of (a) the aggregate maximum amount then available to
be drawn under all such letters of credit (the determination of such maximum
amount to assume compliance with all conditions for drawing), and (b) the
aggregate amount that has then been paid by, and not reimbursed to, the issuers
under such letters of credit.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (or loss
in the case of (a)), together with any related provision for taxes on such gain
(or loss in the case of (a)), realized in connection with (a) any Asset Sale
(including, without limitation, dispositions pursuant to sale and leaseback
transactions and losses) or (b) the disposition of any securities other than
Cash Equivalents by such Person or any of its Restricted Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries and (ii) any extraordinary or nonrecurring gain (or loss), together
with any related provision for taxes on such extraordinary or nonrecurring gain
(or loss), excluding charges related to hyper-inflationary accounting pursuant
to FASB 52 and interpretations by the Commission thereof.
"Net Proceeds" means the aggregate cash proceeds received by the
Issuer or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale (including, without limitation,
legal, accounting and investment banking fees, consent fees to facilitate such
Asset Sale and sales commissions), any relocation expenses incurred as a result
thereof, taxes paid or payable as a result thereof (after taking into account
any available tax credits or deductions and any tax
-10-
sharing arrangements), and any reserve for adjustment in respect of the
sale price of such asset or assets established in accordance with GAAP and the
amount of any payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness that is secured by a Lien on
the asset in question and that is required to be repaid under the terms thereof
as a result of such Asset Sale; provided, however, that Net Proceeds shall not
include any cash payments received from any Asset Sale by a Foreign Subsidiary
unless such proceeds may be repatriated (by reason of a repayment of an
intercompany note or otherwise) to the United States without (in the reasonable
judgment of the Issuer) resulting in a material tax liability to the Issuer.
"New Credit Facility" means that certain Senior Secured Credit
Facility, to be entered into by and among the Issuer, the Credit Agent, as
Administrative Agent, and the other banks and financial institutions party
thereto, providing for $350,000,000 of borrowings, including any related notes,
guaranties, collateral documents, instruments and agreements executed in
connection therewith, and in each case as amended, amended and restated,
modified, supplemented, extended, renewed, refunded, restructured, replaced or
refinanced (in whole or in part) from time to time, whether by the same or any
other agent, lender or group of lenders, including any increases in amounts
outstanding thereunder, and after the Credit Agent has acknowledged in writing
that the New Credit Facility has been terminated and all then-outstanding
Indebtedness thereunder with respect thereto has been repaid in full in cash and
discharged, any successors to or replacements (at any time or from time to time)
of such New Credit Facility (as designated by the Board of Directors as
evidenced by a resolution), as such successors or replacements may be amended,
modified, renewed, refunded, replaced or refinanced from time to time.
"Non-Recourse Debt" means Indebtedness (i) as to which neither the
Issuer nor any of its Restricted Subsidiaries (a) provides credit support of any
kind (including any undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable (as a guarantor or
otherwise), or (c) constitutes the lender; and (ii) no default of which
(including any rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness of the Issuer or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity.
"Note Custodian" means the Trustee, as custodian with respect to the
Notes issued as Global Notes, or any successor entity thereto.
"Note Guaranty" means a Guaranty of the Notes substantially in the
form of Exhibit B hereto that is executed by a Restricted Subsidiary pursuant to
Section 4.20 hereof.
"Obligations" means any principal, interest, penalties, expenses,
fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the
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Treasurer, any Assistant Treasurer, the Controller, the Secretary or any
Executive Vice President, Senior Vice President or Vice President of such
Person.
"Officer's Certificate" means a certificate signed on behalf of the
Issuer by an Officer of the Issuer who may be the Chief Executive Officer, the
Chief Financial Officer or the Treasurer of the Issuer, that meets the
requirements of Section 14.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
14.05 hereof. The counsel may be an employee of or counsel to the Issuer, any
Subsidiary of the Issuer or the Trustee.
"Pari Passu Debt" means any Indebtedness of the Issuer or any of its
Restricted Subsidiaries which, by its terms is pari passu in right of payment
with the Notes.
"Participant" means, with respect to the Depository, a Person who has
an account with the Depository.
"payment in full" (together with any correlative phrases e.g. "paid in
full" and "pay in full") means (i) with respect to any Senior Debt other than
Senior Debt under or in respect of the New Credit Facility, payment in full
thereof or due provision for payment thereof (x) in accordance with the terms of
the agreement or instrument pursuant to which such Senior Debt was issued or is
governed or (y) otherwise to the reasonable satisfaction of the holders of such
Senior Debt, which shall include, in any Insolvency or Liquidation Proceeding,
approval by such holders, individually or as a class, of the provision for
payment thereof, and (ii) with respect to Senior Debt under or in respect of the
New Credit Facility, payment in full thereof in cash or Cash Equivalents.
"Permitted Business" means (i) the operation, management, franchising
and ownership or renting of bowling centers and other businesses related or
incidental thereto, (ii) the manufacture and distribution of all types of
bowling, and bowling center related, products and equipment, billiards products
and equipment and ownership and operation of golf centers and other businesses
related or incidental thereto, and activities related thereto, (iii) ownership
of companies engaged in such businesses and (iv) other businesses engaged in by
the Issuer or its Restricted Subsidiaries on the date of this Indenture or
similar lines of businesses to those engaged in by the Issuer or its Restricted
Subsidiaries on the date of this Indenture, including, but not limited to, the
manufacture and distribution of plastics and related products.
"Permitted Investments" means (a) any Investment in the Issuer or in a
Wholly Owned Restricted Subsidiary of the Issuer; (b) any Investment in Cash
Equivalents; (c) any Investment by the Issuer or any Restricted Subsidiary of
the Issuer in a Person, if as a result of such Investment (i) such Person
becomes a Wholly Owned Restricted Subsidiary of the Issuer or such Restricted
Subsidiary is engaged in a Permitted Business or (ii) such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Issuer or a Restricted
Subsidiary of the Issuer; (d) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made in compliance with
Section 4.10 hereof; (e) any Investment to the extent made in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the Issuer or a
Subsidiary
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Guarantor; (f) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (f) that are at the time
outstanding, not to exceed the sum of (A) $25.0 million, and (B) the aggregate
net cash proceeds (or non-cash proceeds when converted into cash) received by
the Issuer and its Restricted Subsidiaries from the sale or disposition of
investments existing as of the date of this Indenture or made pursuant to this
clause (f); (g) obligations or securities received in connection with any good
faith settlement or Insolvency or Liquidation Proceeding; (h) Hedging
Obligations entered into in the ordinary course of business in connection with
the operation of the business of the Issuer and its Restricted Subsidiaries or
as required by any Indebtedness issued in compliance with this Indenture; (i)
prepaid expenses and loans or advances to employees and similar items in the
ordinary course of business; (j) endorsements of negotiable instruments and
other similar negotiable documents; (k) transactions with Affiliates as
permitted under this Indenture; (1) Investments outstanding as of the date of
this Indenture; and (m) additional Investments in one or more Foreign
Subsidiaries that are not Wholly Owned Restricted Subsidiaries, provided that
the maximum amount of such Investments outstanding at any one time does not
exceed $50.0 million, plus the cash dividends and distributions received by the
Issuer and its Restricted Subsidiaries with respect to Investments pursuant to
this clause (m).
"Permitted Liens" means (i) Liens securing Indebtedness under the New
Credit Facility; (ii) Liens in favor of the Issuer or any Subsidiary; (iii)
Liens on property of a Person existing at the time such Person is merged into or
consolidated with the Issuer or any Subsidiary of the Issuer; provided that such
Liens do not extend to any assets other than those of the Person merged into or
consolidated with the Issuer; (iv) Liens on property existing at the time of
acquisition thereof by the Issuer or any Subsidiary of the Issuer; (v) Liens to
secure the performance of statutory obligations, surety or appeal bonds,
performance bonds or other obligations of a like nature incurred in the ordinary
course of business; (vi) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (iv) of Section 4.09 hereof covering only the
assets acquired with such Indebtedness and any improvements or accessions
thereto; (vii) Liens existing on the date of this Indenture; (viii) Liens for
taxes, assessments or governmental charges or claims that are not yet delinquent
or that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; (ix) Liens on assets of Unrestricted Subsidiaries that
secure Non-Recourse Debt of Unrestricted Subsidiaries; (x) Liens incurred in the
ordinary course of business of the Issuer or any Subsidiary of the Issuer, and
Liens securing Attributable Debt with respect to obligations that do not exceed
$25.0 million at any one time outstanding, and that are not incurred in
connection with the borrowing of money or the obtaining of advances or credit
(other than trade credit in the ordinary course of business or such Attributable
Debt); (xi) Liens in favor of the Trustee; (xii) Liens on Receivables in
connection with a Receivables Transaction; (xiii) Liens incurred in connection
with Permitted Refinancing Indebtedness, but only if such Liens extend to no
more assets than the Liens securing the Indebtedness being refinanced; (xiv)
Liens securing Senior Debt; (xv) statutory Liens of landlords and carriers',
warehousemen's, mechanics', suppliers', materialmen's, repairmen's, or other
like Liens (including contractual landlords' liens) arising in the ordinary
course of business and with respect to amounts not yet overdue for more than 60
days or amounts being contested in good faith by appropriate proceedings, if a
reserve or other appropriate provision, if any, as shall be
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required in conformity with GAAP shall have been made therefor; (xvi) Liens
incurred or deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security; (xvii) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory obligations, surety and appeal bonds,
government contracts, trade contracts, performance and return-of-money bonds and
other obligations of a like nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money); (xviii) Liens to
secure Indebtedness of any Restricted Subsidiary that is a Foreign Subsidiary,
provided that such Indebtedness is used by such Restricted Subsidiary to finance
operations of such Foreign Subsidiary outside the United States and Canada;
(xix) easements, rights-of-way, zoning and other restrictions, covenants,
conditions, encroachments and matters of title that would be disclosed by an
accurate survey or inspection and other defects or irregularities in title and
other similar charges or encumbrances not interfering in any material respect
with the business of the Issuer and its Subsidiaries; (xx) Liens arising from
filing Uniform Commercial Code financing statements regarding leases (other
than true leases and true consignments); (xxi) Liens arising by or pursuant to
operation of law in connection with judgments or attachments, except to the
extent an Event of Default occurs under Section 6.01(f) hereof by reason of the
entry and lack of discharge of such judgment or attachment; (xxii) licenses
(with respect to intellectual property and other property), leases or subleases
not interfering in any material respect with the ordinary conduct of the
business of the Issuer and its Subsidiaries; (xxiii) 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; and (xxiv) Liens which are
provided for by the Plan of Reorganization.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Issuer or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Issuer or any of its Restricted Subsidiaries;
provided that: (i) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal amount of
(or accreted value, if applicable), plus prepayment premium and accrued interest
on, the Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of reasonable expenses incurred in connection
therewith); (ii) such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; (iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the Holders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and (iv) such Indebtedness is incurred either by
the Issuer or by the Restricted Subsidiary which is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
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"Plan of Reorganization" or "Plan" means the Debtors' Second Amended
Second Modified Joint Plan of Reorganization under Chapter 11 of the Bankruptcy
Code, dated January 31, 2002 and approved by the Court on February 1, 2002, as
the same may be further amended or modified from time to time, pursuant to which
this Indenture is being entered into.
"Public Equity Offering" means a public offering of Equity Interests
(other than Disqualified Stock) of the Issuer, that results in the net proceeds
to the Issuer of at least $25.0 million.
"Rating Agencies" means (i) Standard & Poor's Corporation and (ii)
Xxxxx'x Investor's Services or their successors.
"Rating Decline" means the decrease of the rating of the Notes by one
or more gradations by either of the Rating Agencies on, or within 60 days after,
the earlier of (i) the occurrence of a Change of Control and (ii) the date of
public notice of a Change of Control or of the intention of the Company to
effect a Change of Control (which period shall be extended for so long as the
rating of the Notes is under publicly announced consideration for possible
downgrading by either of the Rating Agencies).
"Receivables" means, with respect to any Person or entity, all of the
following property and interests in property of such Person or entity, whether
now existing or existing in the future or hereafter acquired or arising: (i)
accounts, (ii) accounts receivable incurred in the ordinary course of business,
including without limitation, all rights to payment created by or arising from
sales of goods, leases of goods or the rendition of services no matter how
evidenced, whether or not earned by performance, (iii) all rights to any goods
or merchandise represented by any of the foregoing after creation of the
foregoing, including, without limitation, returned or repossessed goods, (iv)
all reserves and credit balances with respect to any such accounts receivable or
account debtors, (v) all letters of credit, security, or guarantees for any of
the foregoing, (vi) all insurance policies or reports relating to any of the
foregoing, (vii) all collection or deposit accounts relating to any of the
foregoing, (viii) all proceeds of the foregoing and (ix) all books and records
relating to any of the foregoing.
"Receivables Subsidiary" means an Unrestricted Subsidiary exclusively
engaged in Receivables Transactions and activities related thereto.
"Receivables Transaction" means (i) the sale or other disposition to a
third party of Receivables or an interest therein, or (ii) the sale or other
disposition of Receivables or an interest therein to a Receivables Subsidiary
followed by a financing transaction in connection with such sale or disposition
of such Receivables (whether such financing transaction is effected by such
Receivables Subsidiary or by a third party to whom such Receivables Subsidiary
sells such Receivables or interests therein); provided that in each of the
foregoing, the Issuer or its Restricted Subsidiaries receive at least 80% of the
aggregate principal amount of any Receivables financed in such transaction.
"Reference Period" means, with respect to the Company and its
Restricted Subsidiaries, the period commencing on the first day of the four full
fiscal quarters immediately preceding the Transaction Date for which financial
information in respect thereof is available through and
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including the Transaction Date; provided, however, that if the Transaction
Date occurs at a time when the financial information in respect of the Company
and its Restricted Subsidiaries is not available for four full fiscal quarters
beginning after the consummation of the Reorganization, then the Reference
Period shall mean the period commencing on the first day of the first full
fiscal quarter after the consummation of the Reorganization for which such
financial information is available through and including the Transaction Date.
"Reorganization" means the transactions consummated pursuant to the
Plan.
"Reorganization Expenses" means, without duplication, (i) all legal,
financial advisory, underwriting, accounting, printing, reproduction fees and
expenses that are incurred by the Issuer and its Subsidiaries and are directly
attributable to the Reorganization, and other restructuring and refinancing
charges reflected in the Issuer's financial statements as "Reorganization
Items," that are incurred by the Issuer and its Subsidiaries, (ii) all debt
issuance and other similar costs and expenses associated with the Reorganization
(but only to the extent that such expenses referred to in the foregoing clauses
(i) and (ii) are reflected in the consolidated financial statements of the
Issuer and its Restricted Subsidiaries after the consummation of the
Reorganization and excluding with respect thereto any use or limitation of net
operating loss or other tax attributes arising out of or in connection with the
Reorganization), and (iii) the writeoff of all goodwill and other intangible
assets, and other adjustments reflected in the Issuer's financial statements,
arising from "fresh start" accounting in connection with the implementation of
the Reorganization.
"Representative" means the trustee, agent or other similar
representative for any Senior Debt.
"Responsible Officer," when used with respect to the Trustee, means
any officer within the corporate trust department of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means all Indebtedness and other Obligations specified
below payable directly or indirectly by the Issuer or any of its Restricted
Subsidiaries, whether outstanding on the date of this Indenture or thereafter
created, incurred or assumed by the Issuer or any of its Restricted
Subsidiaries: (i) the principal of, interest (including Accrued Bankruptcy
Interest) on and all other Obligations related to the New Credit Facility
(including without limitation all loans, Letter of Credit Obligations and other
extensions of credit under the New Credit Facility, and all expenses, fees,
reimbursements, indemnities and other amounts owing pursuant to the New Credit
Facility); (ii) amounts payable in respect of any Hedging Obligations; (iii) all
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Indebtedness permitted to be incurred under this Indenture that is not
expressly pari passu with or subordinated to the Notes; and (iv) all permitted
renewals, extensions, refundings or refinancings thereof. Notwithstanding
anything to the contrary in the foregoing, Senior Debt will not include (i)
Indebtedness of the Issuer or any of its Restricted Subsidiaries to any other
Restricted Subsidiary which is not a Subsidiary Guarantor, (ii) Indebtedness of
the Issuer to the Restricted Subsidiaries, (iii) any Indebtedness which by the
express terms of the agreement or instrument creating, evidencing or governing
the same is junior or subordinate in right of payment to any item of Senior
Debt, (iv) any trade payable arising from the purchase of goods or materials or
for services obtained in the ordinary course of business, or (v) Indebtedness
incurred in violation of this Indenture. To the extent any payment of Senior
Debt (whether by or on behalf of the Issuer or any of its Restricted
Subsidiaries, as proceeds or security or enforcement of any right of setoff or
otherwise) is declared to be fraudulent or preferential, set aside, or required
to be paid to a trustee, receiver or other similar party under any bankruptcy,
insolvency, receivership or similar law, then if such payment is recovered by or
paid over to such trustee, receiver or other similar party, the Senior Debt or
part thereof originally intended to be satisfied shall be deemed to be
reinstated and outstanding as if such payment had not occurred. All Senior Debt
shall be and remain Senior Debt for all purposes of this Indenture, whether or
not subordinated in a bankruptcy, receivership, insolvency or similar
proceeding.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"Stated Maturity" means, with respect to any installment of interest,
accreted value or principal on any Indebtedness, the date on which such payment
of interest or principal is due or is scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest, accreted value or
principal prior to the date originally scheduled for the payment or accretion
thereof.
"Subordinated Indebtedness" means Indebtedness of the Issuer that (i)
is expressly subordinated in payment to the Notes at least to the same extent as
provided in Article 11 hereof and (ii) has no sinking fund payment, mandatory
redemption or scheduled principal payment and does not by its terms become
subject to redemption at the option of the holder prior to ten days after
maturity of the Notes.
"Subsequent Reorganization Securities" means securities distributed to
the Holders of the Notes in an Insolvency or Liquidation Proceeding pursuant to
a plan of reorganization consented to by each and every class of the Senior
Debt, but if and only if all of the terms and conditions of such securities
(including, without limitation, term, tenor, interest, amortization,
subordination, standstills, covenants and defaults) are at least as favorable
(and provide the same relative benefits) to the holders of the Senior Debt and
to the holders of any security distributed in such Insolvency or Liquidation
Proceeding on account of any such Senior Debt as the terms and conditions of the
Notes and this Indenture.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors,
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managers or trustees thereof is at the time owned or controlled, directly
or indirectly, by such Person or one or more of the other Subsidiaries of that
Person (or a combination thereof) and (ii) any partnership (a) the sole general
partner or the managing general partner of which is such Person or a Subsidiary
of such Person or (b) the only general partners of which are such Person or of
one or more Subsidiaries of such Person (or any combination thereof).
"Subsidiary Guarantors" means the Initial Subsidiary Guarantors and
those Restricted Subsidiaries required to execute a Note Guaranty pursuant to
Section 4.20 and any other Subsidiary that executes a Note Guaranty, except for
a Subsidiary Guarantor released from its guaranty under Section 12.04 hereof.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx.
77aaa-77bbbb) as amended and in effect on the date on which this Indenture is
qualified under the TIA, except as provided in Section 9.03 hereof.
"Transaction Date" means the date of the transaction giving rise to
the need to calculate the Consolidated Interest Coverage Ratio; provided, that
if such transaction is related to or in connection with any acquisition of any
Person, the Transaction Date shall be the earliest of (i) the date on which the
Issuer or any Restricted Subsidiary enters into an agreement with such Person to
effect such acquisition, (ii) the date on which the Issuer or any Restricted
Subsidiary first makes a public announcement of such acquisition or any offer or
proposal to effect such acquisition and (iii) the date on which the Issuer or
any Restricted Subsidiary first makes a filing with the SEC, the Federal Trade
Commission or the Department of Justice in connection with such acquisition;
provided, however, that if subsequent to the occurrence of an event described in
clause (i), (ii) or (iii) above the Issuer or any Restricted Subsidiary shall
materially amend the terms of such acquisition with respect to the consideration
payable by the Issuer or any Restricted Subsidiary in connection with such
acquisition, the Transaction Date shall be the earliest of (A) the date on which
the Issuer or any Restricted Subsidiary enters into an agreement with such
Person to effect such acquisition on such amended terms, (B) the date on which
the Issuer or any Restricted Subsidiary makes a public announcement of such
acquisition on such amended terms or any offer or proposal to effect such
acquisition on such amended terms and (C) the date on which the Issuer or any
Restricted Subsidiary first makes a filing disclosing such amended terms with
the SEC, the Federal Trade Commission or the Department of Justice in connection
with such acquisition; and provided, further, however, that if such acquisition
has not been consummated within six months after the occurrence of an event
described in clause (i), (ii) or (iii) above, then the Transaction Date shall be
the date of the consummation of such acquisition.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"United States Government Obligations" means direct obligations of the
United States of America, or any agency or instrumentality thereof, with respect
to the payment of which the full faith and credit of the United States of
America is pledged.
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"Unrestricted Subsidiary" means (i) any Subsidiary that is designated
by the Board of Directors of the Issuer as an Unrestricted Subsidiary pursuant
to a resolution of the Board of Directors; but only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt; (b) on the
date of such designation is not party to any agreement, contract, arrangement or
understanding with the Issuer or any Restricted Subsidiary of the Issuer unless
the terms of any such agreement, contract, arrangement or understanding are no
less favorable to such Issuer or such Restricted Subsidiary than those that
might be obtained at the time from Persons who are not Affiliates of such
Issuer; (c) is a Person with respect to which neither the Issuer nor any of its
Restricted Subsidiaries has any direct or indirect obligation (x) to subscribe
for additional Equity Interests or (y) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results; and (d) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Issuer or any of
its Restricted Subsidiaries. Any such designation by the Board of Directors of
the Issuer shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officer's Certificate certifying that such designation complied with the
foregoing conditions and was permitted by Section 4.07 hereof. 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 this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of such
Issuer as of such date (and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Issuer shall be in
default of such covenant). The Board of Directors of the Issuer may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of such Issuer of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (i) such
Indebtedness is permitted under Section 4.09, calculated on a pro forma basis as
if such designation had occurred at the beginning of the four-quarter reference
period, and (ii) no Default or Event of Default would be in existence following
such designation.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person, all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person, or by one or more Wholly Owned Restricted
Subsidiaries of such Person.
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SECTION 1.02. OTHER DEFINITIONS.
Defined
Term in Section
---- ----------
"Affiliate Transaction"............................... 4.11
"Asset Sale Offer".................................... 4.10
"Change of Control Offer"............................. 4.15
"DTC"................................................. 2.03
"Debtors"............................................. Recitals
"Event of Default".................................... 6.01
"Excess Proceeds"..................................... 4.10
"incur"............................................... 4.09
"Initial Subsidiary Guarantors"....................... Recitals
"Issuer".............................................. Recitals
"Notes"............................................... Recitals
"Offer Amount"........................................ 3.09
"Offer Period"........................................ 3.09
"Paying Agent"........................................ 2.03
"Payment Blockage Period"............................. 11.03
"Permitted Consideration"............................. 4.10
"Permitted Debt"...................................... 4.09
"Purchase Date"....................................... 3.09
"Purchase Offer"...................................... 3.09
"Registrar"........................................... 2.03
"Restricted Payments"................................. 4.07
SECTION 1.03. 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 Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means each Issuer and Subsidiary Guarantor and
any successor obligor upon the Notes.
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All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) All references in this instrument to designated "Articles",
"Sections" and other subdivisions are to the designated Articles,
Sections and subdivisions of this instrument as originally executed.
The words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
(6) provisions apply to successive events and transactions; and
(7) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
SECTION 2.01. FORM AND DATING.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto, which is hereby
incorporated in and expressly made part of this Indenture. The Notes may have
notations, legends or endorsements required by law, stock exchange rule, custom
or usage. Each Note shall be dated the date of its authentication.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Issuer, the
Subsidiary Guarantors and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
However, to the extent any provision of any Note conflicts with the express
provisions of this Indenture, the provisions of this Indenture shall govern and
be controlling.
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(b) Form of Note. Global Notes shall be substantially in the form of
Exhibit A attached hereto (including the text referred to in footnote 1
thereto). Definitive Notes shall be substantially in the form of Exhibit A
attached hereto (but without including the text referred to in footnote 1
thereto). Definitive Notes shall be in denominations of $1,000 and integral
multiples thereof, except as otherwise permitted pursuant to Section 2.06(d)(ix)
hereof. Each Global Note shall represent such of the outstanding Notes as shall
be specified therein, and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the Note
Custodian, at the direction of the Trustee, upon having received written
instructions, in accordance with such instructions given by the Holder thereof
as required by Section 2.06 hereof.
(c) Book-Entry Provisions. This Section 2.01(c) shall only apply to
Global Notes deposited with the Trustee, as custodian for the Depository.
Participants and Indirect Participants shall have no rights under this Indenture
with respect to any Global Note held on their behalf by the Depository or by the
Trustee as the custodian for the Depository or under such Global Note, and the
Depository shall be treated by the Issuer, the Trustee and any agent of the
Issuer or the Trustee as the absolute owner of such Global Note for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect
to any written certification, proxy or other authorization furnished by the
Depository or impair, as between the Depository and its Participants or Indirect
Participants, the Applicable Procedures or the operation of customary practices
of the Depository governing the exercise of the rights of a holder of a
beneficial interest in any Global Note. Participants and Indirect Participants
may hold beneficial interests in the Global Note in denominations of $1.00 and
integral multiples thereof, provided, however that each Note or Notes issued
upon any registration or transfer or exchange of any Note, or pursuant to
Section 2.10 or Section 3.06 hereof, shall be issued in the denominations
required by Section 2.06(d)(ix) hereof.
(d) Certificated Securities. The Issuer may initially issue the Notes
as Definitive Notes. However, the initial issuance of Definitive Notes does not
preclude the issuance of Global Notes upon the deposit of such Definitive Notes
with the Trustee, as custodian for the Depository. If at any time the Depository
notifies the Issuer that it is unwilling or unable to continue as Depository or
if at any time the Depository shall no longer be eligible under this Section
2.01, the Issuer shall appoint a successor Depository. If a successor Depository
is not appointed by the Issuer within ninety (90) days after the Issuer receives
such notice or becomes aware of such ineligibility, the Issuer's election
pursuant to Section 2.02 that the Notes be represented by Global Notes shall no
longer be effective and the Issuer will execute, and the Trustee, upon receipt
of written order signed by an Officer of the Issuer for the authentication and
delivery of Definitive Notes, will authenticate and deliver Definitive Notes, in
authorized denominations, in an aggregate principal amount and like terms and
tenor equal to the principal amount of the Global Notes in exchange for such
Global Notes.
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The Issuer may at any time and in its sole discretion determine that
Notes shall no longer be represented by such Global Notes. In such event, the
Issuer will execute, and the Trustee, upon receipt of an Issuer order for the
authentication and delivery of definitive Notes of the same terms and tenor,
will authenticate and deliver Definitive Notes, in authorized denominations, and
in an aggregate principal amount equal to the principal amount of the Global
Notes in exchange for such Global Notes.
If specified by the Issuer, pursuant to this Section 2.01 with respect
to Global Notes, the Depository may surrender Global Notes in exchange in whole
or in part for Definitive Notes of like terms and tenor on such terms as are
acceptable to the Issuer and such Depository. Thereupon, the Issuer shall
execute, and the Trustee, upon receipt of an Issuer order for the authentication
and delivery of Definitive Notes, shall authenticate and deliver, without
service charge to the Holders:
(i) to each Person specified by such Depository a new Definitive Note
of the same tenor, in authorized denominations, in an aggregate principal amount
equal to and in exchange for such Person's beneficial interest in the Global
Note; and
(ii) to such Depository a new Global Note in a denomination equal to
the difference, if any, between the principal amount of the surrendered Global
Note and the aggregate principal amount of the Definitive Notes delivered to
Holders pursuant to clause (i) above.
Upon the exchange of a Global Note for Definitive Notes, such Global
Note shall be cancelled by the Trustee or an agent of the Issuer or the Trustee.
Definitive Notes in exchange for a Global Note pursuant to this Section 2.01(d)
shall be registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its Participants or otherwise, shall
instruct the Trustee or an agent of the Issuer or the Trustee in writing. The
Trustee or such agent shall deliver such Note to or as directed by the Persons
in whose names such Notes are so registered or to the Depository.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
An Officer shall sign the Notes for the Issuer by manual or facsimile
signature. If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of the Issuer signed by an
Officer thereof, authenticate Notes for original issue up to the aggregate
principal amount stated in paragraph 4 of the Notes. Such order shall specify
the principal amount of the Notes and the date on which the Notes are to be
authenticated.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Issuer to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication
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by such agent. An authenticating agent has the same rights as an Agent to deal
with the Issuer or an Affiliate of the Issuer.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Issuer shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Issuer may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Issuer may change any
Paying Agent or Registrar without notice to any Holder. The Issuer shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Issuer fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuer or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Issuer initially appoints The Depository Trust Company ("DTC") to
act as Depository with respect to the Global Notes.
The Issuer initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
Not later than 10:00 a.m. Eastern Time on each due date of the
principal or interest on any of the Notes, the Issuer shall deposit with the
Paying Agent money in immediately available funds sufficient to pay such
principal or interest so becoming due. The Issuer shall require the Paying Agent
other than the Trustee to agree in writing that the Paying Agent shall hold in
trust for the benefit of Holders or the Trustee all money held by the Paying
Agent for the payment of principal, premium or interest on the Notes, and shall
notify the Trustee of any default by the Issuer in making any such payment.
While any such default continues, the Trustee may require the Paying Agent to
pay all money held by it to the Trustee. The Issuer at any time may require the
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than the Issuer or a Subsidiary) shall
have no further liability for the money. If the Issuer or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy
or reorganization proceedings relating to the Issuer, the Trustee shall serve as
Paying Agent for the Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Issuer and/or the Subsidiary Guarantors shall furnish to
the Trustee at least seven Business Days before each interest payment date and
at such other times as the Trustee may request in writing a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of the Holders and the Issuer and the Subsidiary Guarantors shall
otherwise comply with TIA ss. 312(a).
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SECTION 2.06. TRANSFER AND EXCHANGE.
(a) When Notes are presented to the Registrar with a request to
register the transfer or to exchange them for an equal principal amount of Notes
of other denominations, the Registrar shall register the transfer or make the
exchange if its requirements for such transactions are met; provided, however,
that any Note presented or surrendered for transfer or exchange shall be duly
endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Registrar and the Trustee duly executed by the Holder
thereof or by his attorney duly authorized in writing. To permit registrations
of transfers and exchanges, the Issuer shall execute and the Trustee shall
authenticate Global Notes and Definitive Notes upon the Issuer's order or at the
Registrar's request.
(b) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(A) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUER."
(c) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in Global Notes have been exchanged for Definitive
Notes, redeemed, repurchased or cancelled, all Global Notes shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for Definitive Notes, redeemed, repurchased or cancelled, the
principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note, by the Trustee
or the Note Custodian, at the direction of the Trustee, to reflect such
reduction.
(d) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Issuer shall execute and the Trustee shall authenticate Definitive Notes and
Global Notes upon receipt of a written order signed by an Officer of the Issuer
or at the Registrar's written request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or a Holder for any registration of transfer or
exchange, but the Issuer may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable upon
exchange or transfer solely pursuant to Sections 3.07, 3.09, 4.10, 4.15 and 9.05
hereto).
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(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(iv) All Definitive Notes and Global Notes issued upon any
registration of transfer or exchange of Definitive Notes or Global Notes shall
be the valid obligations of the Issuer, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Definitive Notes or Global
Notes surrendered upon such registration of transfer or exchange.
(v) The Issuer shall not be required: to issue, to register the
transfer of or to exchange Notes during a period beginning at the opening of
business 15 days before the day of mailing of a notice of redemption of Notes
under Section 3.03 hereof and ending at the close of business on the day of such
mailing; or to register the transfer of or to exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of any Note being
redeemed in part; or to register the transfer of or to exchange a Note between
a record date and the next succeeding interest payment date.
(vi) Prior to due presentment for the registration of a transfer
of any Note, the Trustee, any Agent and the Issuer may deem and treat the Person
in whose name any Note is registered as the absolute owner of such Note for the
purpose of receiving payment of principal of and interest on such Notes and for
all other purposes, subject to the provisions of this Indenture and the Notes
relating to record dates for the payment of interest, and neither the Trustee,
nor any Agent nor the Issuer shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive Notes and
Global Notes in accordance with the provisions of Section 2.02 hereof.
(viii)All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this Section 2.06
to effect a registration of transfer or exchange may be submitted by facsimile.
(ix) Each Note or Notes issued upon any registration of
transfer or exchange of any Note, or pursuant to Section 2.10 or Section 3.06
hereof, shall be issued in denominations of $1,000 or integral multiples
thereof, except that not more than one (1) new Note so being issued in respect
of the Note being surrendered (the "surrendered Note") may be in a denomination
that is not $1,000 or an integral multiple thereof. Notes may not be surrendered
for combination into a Note with a principal amount that is not $1,000 or an
integral multiple thereof.
Each Holder of a Note agrees to indemnify the Issuer and the Trustee
against any liability that may result from the transfer, exchange or assignment
of such Holder's Note in violation of any provision of this Indenture and/or
applicable United States federal or state securities law.
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
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law with respect to any transfer of any interest in any Note (including any
transfers between or among Participants or beneficial owners of interests in any
Global Note) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so when
expressly required by terms of, this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
SECTION 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the Issuer and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Issuer shall issue and the Trustee, upon the written
order of the Issuer signed by an Officer of the Issuer, shall authenticate a
replacement Note if the requirements under the Indenture are met. If required by
the Issuer or the Trustee, an indemnity bond must be supplied by the Holder that
is sufficient in the judgment of the Trustee and the Issuer to protect the
Issuer, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. The Issuer may charge for its
expenses in replacing a Note.
Every replacement Note is an additional obligation of the Issuer and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because any Issuer or Subsidiary Guarantor or
an Affiliate of any Issuer or Subsidiary Guarantor holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Issuer, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09. TREASURY NOTES
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Issuer or any Subsidiary Guarantor, or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Issuer or any Subsidiary Guarantor, shall be considered as
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though not outstanding, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Notes that a Responsible Officer of the Trustee actually knows are
so owned shall be so disregarded. Notes so owned that have been pledged in good
faith shall not be disregarded if the pledgee establishes, to the satisfaction
of the Trustee, the pledgee's right to deliver any such direction, waiver, or
consent with respect to the Notes and that the pledgee is not the Issuer, a
Subsidiary Guarantor, any other obligor upon the Notes or any Affiliate of the
Issuer or of such other obligor.
SECTION 2.10. TEMPORARY NOTES.
Until Definitive Notes are ready for delivery, the Issuer may prepare
and the Trustee shall authenticate temporary Notes upon a written order of the
Issuer signed by an Officer of the Issuer. Temporary Notes shall be
substantially in the form of Definitive Notes but may have variations that the
Issuer considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Issuer shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
SECTION 2.11. CANCELLATION
The Issuer at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes in accordance with its customary procedure. Certification of
destruction shall be delivered to the Issuer. The Issuer may not issue new Notes
to replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Issuer or any of the Subsidiary Guarantors defaults in a
payment of interest on the Notes, it shall pay the defaulted interest in any
lawful manner plus, to the extent lawful, interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date, in
each case at the rate provided in the Notes and in Section 4.01 hereof. The
Issuer shall notify the Trustee in writing of the amount of defaulted interest
proposed to be paid on each Note and the date of the proposed payment. The
Issuer shall fix or cause to be fixed each such special record date and payment
date, provided that no such special record date shall be less than 10 days prior
to the related payment date for such defaulted interest. At least 15 days before
the special record date, the Issuer (or, upon the written request of the Issuer,
the Trustee in the name and at the expense of the Issuer) shall mail or cause to
be mailed to Holders a notice that states the special record date, the related
payment date and the amount of such interest to be paid.
SECTION 2.13. CUSIP NUMBERS.
The Issuer in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided, however, that any such
notice may state that no representation is made as to
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the correctness of such numbers either as printed on the Notes or as contained
in any notice ofredemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Issuer will
promptly notify the Trustee of any change in the "CUSIP" numbers.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Issuer elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, the Issuer shall furnish to the
Trustee, at least 30 (or a lesser number acceptable to the Trustee) days but not
more than 60 days before a redemption date, an Officer's Certificate setting
forth (i) the paragraph of the Notes and/or Section of this Indenture pursuant
to which the redemption shall occur, (ii) the redemption date, (iii) the
principal amount of Notes to be redeemed and (iv) the redemption price.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time,
selection of Notes for redemption will be made by the Trustee in compliance with
the requirements of the principal national securities exchange or trading
system, if any, on which the Notes are listed or accepted for trading, or, if
the Notes are not so listed or accepted for trading, on a pro rata basis, by lot
or by such method as the Trustee shall deem fair and appropriate and in
accordance with methods generally used at the time of selection by fiduciaries
in similar circumstances. If any Note is to be redeemed in part only, the notice
of redemption that relates to such Note shall state the portion of the principal
amount thereof to be redeemed. A new Note in principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Note. Notes called for redemption become due on the
date fixed for redemption. On and after the redemption date, interest ceases to
accrue on Notes or portions of them called for redemption unless the Issuer
defaults in making such redemption payment.
The Trustee shall promptly notify the Issuer in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date,
the Issuer shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.
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The notice shall identify the Notes to be redeemed (including CUSIP
numbers, if any) and shall state:
(a) the redemption date;
(b) the redemption price for the Notes and accrued and unpaid
interest, if any;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Issuer defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) the CUSIP number, if any, of the Notes called for redemption and
that no representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Notes.
At the Issuer's request, the Trustee shall give the notice of
redemption in the Issuer's name and at the Issuer's expense; provided, however,
that the Issuer shall have delivered to the Trustee, at least 45 (or a lesser
number acceptable to the Trustee) days prior to the redemption date, an
Officer's Certificate requesting that the Trustee give such notice and setting
forth the information in such notice required by the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price plus accrued and unpaid interest to such
date. A notice of redemption may not be conditional. Upon surrender to the
Paying Agent of any of the Notes called for redemption, those Notes shall be
paid on the redemption date at the redemption price, together with accrued and
unpaid interest to such date.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 a.m. (New York City time) on the redemption date,
the Issuer shall deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption price of and accrued and unpaid interest on all
Notes to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to the Issuer any money deposited with the Trustee or the
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Paying Agent by the Issuer in excess of the amounts necessary to pay the
redemption price of, and accrued and unpaid interest on, all Notes to be
redeemed.
If the Issuer complies with the provisions of the preceding paragraph,
on and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Issuer to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not paid on
such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.
Unless the Issuer shall default in the payment of Notes (and accrued
and unpaid interest) called for redemption, interest on such Notes shall cease
to accrue after the redemption date.
SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Issuer shall
issue and, upon receipt of a written order signed by an Officer of the Issuer,
the Trustee shall authenticate for the Holder at the expense of the Issuer a new
Note equal in principal amount to the unredeemed portion of the Note
surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in Section 3.07(b), the Notes shall not be
redeemable at the Issuer's option prior to February 28, 2005. Thereafter, the
Notes shall be redeemable at the option of the Issuer, in whole or in part, at
any time upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest thereon, if any, to the applicable redemption date,
if redeemed during the twelve-month period beginning on February 28 of the years
indicated below:
Year Percentage
2005........................................... 106.5%
2006........................................... 103.25%
2007 and thereafter............................ 100.00%
(b) Notwithstanding clause (a) of this Section 3.07: (i) at any time
prior to February 28, 2005, the Issuer may on any one or more occasions redeem
up to 35% of the initially outstanding aggregate principal amount of Notes at a
redemption price equal to 113.00% of the principal amount thereof, plus accrued
and unpaid interest, if any, thereon to the redemption date, with the cash
proceeds of one or more Public Equity Offerings; provided that, in each case, at
least 65% of the initially outstanding aggregate principal amount of Notes
remains outstanding immediately after the occurrence of such redemption; and
provided, further, that such redemption shall occur within 75 days of the date
of the closing of such Public Equity Offering; and (ii) upon a Change of Control
Triggering Event, the Issuer may, but shall in no event be
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required to, at any time, within 75 days after the Change of Control Date,
redeem 100% but not less than 100% of the outstanding Notes at a redemption
price equal to the lower of 110.00% of the principal amount thereof and the
amount at which the Issuer could redeem the Notes pursuant to Section 3.07(a)
hereof, plus accrued and unpaid interest thereon, if any, to the redemption
date.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
The Issuer shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes, provided that this Section 3.08
shall not be deemed to affect the obligations of the Issuer pursuant to Section
4.10 or 4.15 hereof.
SECTION 3.09. OFFER TO PURCHASE NOTES.
If the Issuer shall be required to commence an offer to all Holders to
purchase Notes (a "Purchase Offer") pursuant to Section 4.10 hereof, an "Asset
Sale Offer," or pursuant to Section 4.15 hereof, a "Change of Control Offer,"
the Issuer shall follow the procedures specified below.
The Purchase Offer shall remain open for a period of 20 Business Days
following its commencement (the "Offer Period"). No later than five Business
Days after the termination of the Offer Period (the "Purchase Date"), the Issuer
shall purchase the principal amount of Notes required to be purchased pursuant
to Section 4.10 hereof, in the case of an Asset Sale Offer, or 4.15 hereof, in
the case of a Change of Control Offer (the "Offer Amount") or, if less than the
Offer Amount has been tendered, all Notes tendered in response to the Purchase
Offer. Payment for any Notes so purchased shall be made in the same manner as
interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Purchase Offer.
Upon the commencement of a Purchase Offer, the Issuer shall send, by
first class mail, a notice to each of the Holders, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Purchase Offer. The Purchase Offer shall
be made to all Holders. The notice, which shall govern the terms of the Purchase
Offer, shall state:
(a) that the Purchase Offer is being made pursuant to this Section
3.09 and Section 4.10 or 4.15 hereof, as applicable, and the length of time the
Purchase Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrue interest;
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(d) that, unless the Issuer defaults in making such payment, any Note
accepted for payment pursuant to the Purchase Offer shall cease to accrue
interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to any
Purchase Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note duly completed,
or transfer by book-entry transfer, to the Issuer, a depository, if appointed by
the Issuer, or a Paying Agent at the address specified in the notice prior to
the expiration of the Offer Period;
(f) that Holders shall be entitled to withdraw their election if the
Issuer, the depository or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the Note
the Holder delivered for purchase, the certificate number (in the case of a
Definitive Note) and a statement that such Holder is withdrawing his election to
have such Note purchased;
(g) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Issuer shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(h) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
On or before 10:00 a.m. (New York City time) on each Purchase Date,
the Issuer shall irrevocably deposit with the Trustee or Paying Agent in
immediately available funds the aggregate purchase price with respect to a
principal amount of Notes equal to the Offer Amount (or if less the principal
amount of the Notes delivered prior to the expiration of the Offer Period),
together with accrued and unpaid interest thereon (to the extent then required
to be paid), to be held for payment in accordance with the terms of this Section
3.09. On the Purchase Date, the Issuer shall, to the extent lawful, (i) accept
for payment, on a pro rata basis to the extent necessary, the Offer Amount of
Notes tendered pursuant to the Purchase Offer, or if less than the Offer Amount
has been tendered, all Notes tendered, (ii) deliver or cause the Paying Agent or
Depository, as the case may be, to deliver to the Trustee Notes so accepted and
(iii) deliver to the Trustee an Officer's Certificate stating that such Notes
were accepted for payment by the Issuer in accordance with the terms of this
Section 3.09. The Issuer, the Depository or the Paying Agent, as the case may
be, shall promptly (but in any case not later than three Business Days after the
Purchase Date) mail or deliver to each tendering Holder an amount equal to the
purchase price of the Notes tendered by such Holder and accepted by the Issuer
for purchase, plus any accrued and unpaid interest thereon, and the Issuer shall
promptly issue a new Note, and the Trustee shall authenticate and mail or
deliver such new Note to such Holder, equal in principal amount to any
unpurchased portion of such Holder's Notes surrendered. Any Note not so accepted
shall be promptly mailed or delivered by the Issuer to the Holder thereof. The
Issuer shall publicly announce in a newspaper of general circulation or in a
press release provided to a nationally recognized financial wire service the
results of the Purchase Offer on the Purchase Date.
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ARTICLE 4.
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
The Issuer shall pay or cause to be paid the principal of, premium, if
any, and interest on the Notes on the dates and in the manner provided in this
Indenture and in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Issuer or
a Subsidiary, holds as of 10:00 a.m. New York City Time on the due date money
deposited by the Issuer in immediately available funds and designated for and
sufficient to pay all principal, premium, if any, and interest then due and the
Paying Agent is not prohibited from paying such money to Holders on such date
pursuant to the terms of this Indenture.
The Issuer shall pay interest on overdue principal at the rate equal
to 1% per annum in excess of the then applicable interest rate on the Notes to
the extent lawful; it shall pay interest on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Issuer shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Issuer in respect of the Notes and this Indenture may be served. The
Issuer shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Issuer may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Issuer of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Issuer shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Issuer hereby designates the Corporate Trust Office of the Trustee
as one such office or agency of the Issuer in accordance with Section 2.03
hereof.
SECTION 4.03. REPORTS.
Whether or not required by the rules and regulations of the
Commission, so long as any Notes are outstanding, the Issuer shall furnish to
the Trustee, within 15 days of the time periods specified in the Commission's
rules and regulations for filing reports, all quarterly and annual financial
information that would be required to be contained in a filing with the
Commission on Forms 10-Q and 10-K, as the case may be, if the Issuer were
required to file such Forms,
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including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial condition and results of
operations of the Issuer and its consolidated Subsidiaries and, with respect to
the annual information only, a report thereon by the Issuer's certified
independent accountant. In addition, whether or not required by the rules and
regulations of the Commission, the Issuer shall file a copy of all such
documents with the Commission for public availability (unless the Commission
will not accept such a filing) and make such information available to securities
analysts and prospective investors upon request. The Trustee will provide, at
the Issuer's expense, copies of any such documents to any Holders that request
such copies. The Issuer will also comply with the other provisions of TIA
Section 314(a). Delivery of such documents to the Trustee is for informational
purposes only, and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Issuer's compliance with any of its
covenants hereunder (as to which the Trustee is entitled to rely on Officer's
Certificates).
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Issuer shall, so long as any of the Notes are outstanding,
deliver to the Trustee, within 120 days after the end of each fiscal year, an
Officer's Certificate which need not comply with Section 14.05 hereof, stating
that a review of the activities of the Issuer and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers (one of whom shall be the principal executive officer, principal
financial officer or principal accounting officer of the Issuer) with a view to
determining whether the Issuer has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each Officer
signing such certificate, that to the best of his or her knowledge the Issuer
has kept, observed, performed and fulfilled each covenant contained in this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action, if any, such Issuer is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action, if any, the Issuer is taking or proposes to take with respect thereto.
(b) The Issuer shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officer's Certificate specifying such Default or Event
of Default and what action the Issuer is taking or proposes to take with respect
thereto.
SECTION 4.05. TAXES.
The Issuer shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies,
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
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SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
The Issuer and each of the Subsidiary Guarantors covenants (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, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer and each of the Subsidiary Guarantors (to the extent
that they may lawfully do so) hereby expressly waives all benefit or advantage
of any such law, and covenants that they shall not, by resort to any such law,
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 has been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make
any other payment or distribution on account of the Issuer's or any of its
Restricted Subsidiaries' Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the Issuer
(other than cash in lieu of fractional shares)) or to the direct or indirect
holders of the Issuer's or any of its Restricted Subsidiaries' Equity Interests
in their capacity as such (other than dividends or distributions payable (a) in
additional Equity Interests (other than Disqualified Stock) of the Issuer or (in
the case of a dividend, other payment or distribution on account of the Equity
Interest of a Restricted Subsidiary) of such Restricted Subsidiary or (b) to the
Issuer or its Restricted Subsidiaries); (ii) purchase, redeem or otherwise
acquire or retire for value (including without limitation, in connection with
any merger or consolidation involving the Issuer) any Equity Interests of the
Issuer or any direct or indirect parent of the Issuer; (iii) make any payment on
or with respect to, or purchase, redeem, defease or otherwise acquire or retire
for value any Indebtedness (other than the Notes) that is pari passu with or
subordinated to the Notes or the Note Guaranties, except a payment of interest
or principal at Stated Maturity; or (iv) make any Restricted Investment (all
such payments and other actions set forth in clauses (i) through (iv) above
being collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(b) the Issuer would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Consolidated
Interest Coverage Ratio test set forth in the first paragraph of Section 4.09;
and
(c) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Issuer and its Restricted Subsidiaries
after the date of this Indenture (excluding Restricted Payments permitted by
clauses (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix) and (x), of the
next succeeding paragraph), is less than the sum of (i) 50% of the Consolidated
Net Income accrued during the period (treated as one accounting period) from the
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beginning of the fiscal quarter immediately following the fiscal quarter in
which the effective date of the Plan occurred to the end of the most recent
fiscal quarter ending at least 45 days (or, if less, the number of days after
the end of such fiscal quarter as the consolidated financial statements of the
Issuer shall be provided hereunder) prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a deficit, minus 100% of such
deficit), plus (ii) 100% of the aggregate net cash proceeds received by the
Issuer from the issue or sale since the date of this Indenture of Equity
Interests of the Issuer (other than Disqualified Stock) or of Disqualified Stock
or debt securities of the Issuer that have been converted into such Equity
Interests (other than Equity Interests (or Disqualified Stock or convertible
debt securities) sold to a Subsidiary of the Issuer and other than Disqualified
Stock or convertible debt securities that have been converted into Disqualified
Stock) or of capital contributions to the Issuer, plus (iii) to the extent that
any Restricted Investment that was made after the date of this Indenture is sold
for cash or otherwise liquidated or repaid for cash the aggregate amount
received in cash with respect thereto (less the cost of disposition, if any),
including, without limitation, any cash dividends or distributions, and any cash
dividends or distributions received from any Unrestricted Subsidiary.
The foregoing provisions shall not prohibit (i) the payment of any
dividend or distribution within 60 days after the date of declaration thereof,
if at said date of declaration such payment would have complied with the
provisions of this Indenture; (ii) the redemption, repurchase, retirement,
defeasance or other acquisition of any Pari Passu Debt, or subordinated
Indebtedness or Equity Interests of the Issuer or any Restricted Subsidiary in
exchange for, or out of the net cash proceeds of, the substantially concurrent
sale or issuance (other than to a Restricted Subsidiary of the Issuer) of Equity
Interests of the Issuer or any Restricted Subsidiary (other than any
Disqualified Stock); provided that the amount of any such net cash proceeds that
is utilized for any such redemption, repurchase, retirement, defeasance or other
acquisition shall be excluded from clause (ii) of the preceding paragraph; (iii)
the defeasance, redemption, repurchase or other acquisition of Pari Passu Debt
or subordinated Indebtedness with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness; (iv) the payment of any dividend or
distribution by a Restricted Subsidiary of the Issuer to the holders of its
Equity Interests on a pro rata basis; (v) the repurchase, redemption or other
acquisition or retirement for value of any Equity Interests of the Issuer, any
Restricted Subsidiary of the Issuer, or any direct or indirect parent of the
Issuer or its Restricted Subsidiaries held by any member of the Issuer's (or any
of its Restricted Subsidiaries') management pursuant to any management equity
subscription agreement or stock option agreement either (a) in effect as of the
date of this Indenture; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not exceed
$5.0 million in any twelve-month period and no Default or Event of Default shall
have occurred and be continuing immediately after such transaction or (b) upon
the termination of such person's employment; (vi) additional payments in an
aggregate amount not to exceed $25.0 million; (vii) Investments received by the
Issuer or any of their Restricted Subsidiaries as non-cash consideration from
Asset Sales to the extent permitted by Section 4.10; (viii) any transaction
pursuant to the Reorganization; (ix) transactions contemplated by the Plan; and
(x) any Restricted Payment authorized or required under the New Credit Facility.
The Board of Directors may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if such designation would not cause a Default;
provided that in no event shall the
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business currently operated by any Subsidiary Guarantor be transferred to
or held by an Unrestricted Subsidiary. For purposes of making such
determination, all outstanding Investments by the Issuer and its Restricted
Subsidiaries (except to the extent repaid in cash) in the Subsidiary so
designated shall be deemed to be Restricted Payments at the time of such
designation and shall be included for purposes of calculating the aggregate
amount of Restricted Payments under clause (c) of the first paragraph of this
Section 4.07. 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.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Issuer or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any individual or series of related non-cash Restricted Payments
(other than in the Reorganization) shall be determined by the Board of Directors
whose resolution with respect thereto shall be delivered to the Trustee, such
determination to be based upon an opinion or appraisal issued by an accounting,
appraisal or investment banking firm of national standing, as applicable, if
such fair market value exceeds $10.0 million. In connection with each Restricted
Payment, the Issuer shall deliver to the Trustee, prior to or within 60 days of
the making of such Restricted Payment, an Officer's Certificate stating that
such Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, together with a copy
of any fairness opinion or appraisal required by this Indenture.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary that is not a Subsidiary Guarantor to (i)(a) pay dividends
or make any other distributions to the Issuer or any of its Restricted
Subsidiaries on its Capital Stock, or (b) pay any indebtedness owed to the
Issuer or any of its Restricted Subsidiaries, (ii) make loans or advances to the
Issuer or any of its Restricted Subsidiaries or (iii) transfer any of its
properties or assets to the Issuer or any of its Restricted Subsidiaries, except
for such encumbrances or restrictions existing under or by reason of (a)
Existing Indebtedness, (b) the New Credit Facility, and any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacement or refinancings are substantially no more restrictive when taken as
a whole with respect to such dividend and other payment restrictions than those
contained in the New Credit Facility as in effect on the date of this Indenture,
(c) this Indenture and the Notes, (d) applicable law, (e) any instrument
governing Indebtedness or Capital Stock of a Person acquired by the Issuer or
any of its Restricted Subsidiaries as in effect at the time of such acquisition
(except to the extent such Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person and its Subsidiaries, or the property or assets of the
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Person and its Subsidiaries, so acquired, (f) by reason of customary
non-assignment or net worth provisions in leases or licenses entered into in the
ordinary course of business and consistent with past practices, (g) purchase
money obligations for property acquired that impose restrictions of the nature
described in clause (iii) above on the property so acquired, (h) Permitted
Refinancing Indebtedness, provided that the restrictions contained in the
agreements governing such Permitted Refinancing Indebtedness are substantially
no more restrictive when taken as a whole than those contained in the agreements
governing the Indebtedness being refinanced, (i) any instrument or agreement
governing Indebtedness permitted to be incurred under this Indenture, which is
secured by a Lien permitted to be incurred under this Indenture, (j)
restrictions applicable to a Receivables Subsidiary arising from a Receivables
Transaction, (k) contracts for the sale of assets, including, without
limitation, customary restrictions with respect to a Restricted Subsidiary with
respect to the issuance pursuant to an agreement that has been entered into for
the sale or disposition of all or substantially all of the Capital Stock or
assets of such Restricted Subsidiary or (l) customary provisions in joint
venture agreements or other similar agreements.
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Issuer and the Restricted Subsidiaries shall not issue any
Disqualified Stock or shares of preferred stock; provided, however, that the
Issuer and its Restricted Subsidiaries may incur Indebtedness (including
Acquired Debt and Indebtedness under the New Credit Facility) or issue shares of
Disqualified Stock or preferred stock if:
(i) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such incurrence;
(ii) in the case of the incurrence of Subordinated Indebtedness by the
Issuer, after giving effect to such incurrence (including the pro forma
application of the net proceeds therefrom), the Consolidated Interest Coverage
Ratio is greater than 2.0 to 1.0; provided, that so long as any Indebtedness
incurred pursuant to clause (iii) of this Section 4.09 shall remain outstanding,
such Consolidated Interest Coverage Ratio shall be greater than 2.5 to 1.0 after
giving effect to such incurrence (including the pro forma application of the net
proceeds thereof); and
(iii) in the case of the incurrence of any Indebtedness other than
Subordinated Indebtedness by the Issuer or the incurrence of any Indebtedness by
a Restricted Subsidiary, after giving effect to such incurrence (including the
pro forma application of the net proceeds thereof), the Consolidated Interest
Coverage Ratio is greater than 2.5 to 1.0.
The provisions of the first paragraph of this covenant will not apply
to the incurrence of any of the following items of Indebtedness, which shall be
permitted notwithstanding anything otherwise to the contrary in this Indenture
(collectively, "Permitted Debt"):
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(i) the incurrence by the Issuer or any of its Restricted Subsidiaries
of Indebtedness under the New Credit Facility and the issuance of letters of
credit thereunder from time to time;
(ii) the incurrence by the Issuer and its Subsidiaries of the Existing
Indebtedness;
(iii) the incurrence by the Issuer and the Subsidiary Guarantors of
Indebtedness represented by the Notes;
(iv) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage
financings or purchase money obligations, in each case incurred for the purpose
of financing all or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of the Issuer
or such Restricted Subsidiary, in an aggregate principal amount at any time
outstanding not to exceed 5% of the amount of the consolidated assets of the
Issuer and its Subsidiaries, as shown on the consolidated balance sheet of the
Issuer and its Subsidiaries included in the financial information most recently
provided to the Trustee pursuant to Section 4.03 hereof;
(v) the incurrence by the Issuer or any of its Restricted Subsidiaries
of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to refund, refinance or replace Indebtedness that was permitted
by this Indenture to be incurred;
(vi) Indebtedness incurred by the Issuer or any of its Restricted
Subsidiaries constituting reimbursement obligations with respect to surety bonds
or letters of credit issued in the ordinary course of business, including,
without limitation, surety bonds or letters of credit in respect of workers'
compensation claims or self-insurance, or other Indebtedness with respect to
reimbursement type obligations regarding workers' compensation claims;
(vii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Issuer and any of
its Restricted Subsidiaries; provided, however, that (i) if the Issuer is the
obligor on such Indebtedness and the payee is not a Subsidiary Guarantor, such
Indebtedness is expressly subordinated to the prior payment in full in cash of
all Obligations with respect to the Notes and (ii)(A) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being held by
a Person other than the Issuer or a Restricted Subsidiary and (B) any sale or
other transfer of any such Indebtedness to a Person that is not either the
Issuer or a Restricted Subsidiary shall be deemed, in each case, to constitute
an incurrence of such Indebtedness by the Issuer or such Restricted Subsidiary,
as the case may be, that was not permitted by this clause (vii);
(viii) the incurrence by the Issuer or any of its Subsidiaries of
Hedging Obligations;
(ix) Indebtedness incurred pursuant to the terms and provisions, and
in connection with the implementation, of the Plan;
(x) the Guaranty by the Issuer or any of its Subsidiaries of
Indebtedness of the Issuer or a Restricted Subsidiary of the Issuer that was
permitted by this Indenture to be incurred;
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(xi) the incurrence of Non-Recourse Debt, provided, however, that if
any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted
Subsidiary, such event shall be deemed to constitute an incurrence of
Indebtedness by a Restricted Subsidiary of the Issuer;
(xii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of additional Indebtedness, in an aggregate principal amount (or
accreted value, as applicable) at any time outstanding, including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any other
Indebtedness incurred pursuant to this clause (xii), not to exceed $25 million;
(xiii) Acquired Debt of a Subsidiary in existence at the time of the
acquisition of such Subsidiary, if such Acquired Debt was not incurred in
contemplation of such acquisition and such Acquired Debt is Non-Recourse Debt
(except with respect to such acquired Subsidiary and its Subsidiaries); and
(xiv) Asset Sales in the form of Receivables Transactions.
For purposes of determining compliance with this covenant, if an item
of Indebtedness meets the criteria of more than one of the categories of
Permitted Debt described in clauses (i) through (xiv) above or is entitled to be
incurred pursuant to the first paragraph of this Section 4.09, the Issuer shall,
in its sole discretion, classify such item of Indebtedness in any manner that
complies with this covenant and such item of Indebtedness will be treated as
having been incurred pursuant to only one of such clauses or pursuant to the
first paragraph hereof. Neither the accrual of interest, nor the accretion of
accreted value, will be deemed to be an incurrence of Indebtedness for purposes
of this Section 4.09.
SECTION 4.10. ASSET SALES.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Issuer (or the
Restricted Subsidiary, as the case may be) receives consideration at the time of
such Asset Sale at least equal to the fair market value (evidenced by an
Officer's Certificate delivered to the Trustee and a resolution of the Board of
Directors) of the assets or Equity Interests issued or sold or otherwise
disposed of and (ii) at least 80% of the consideration therefor received by the
Issuer or such Restricted Subsidiary is in the form of (A) cash, (B) assets
useful in a Permitted Business not to exceed $50.0 million in the aggregate over
the life of the Notes, and/or (C) Equity Interests representing a controlling
interest in a Permitted Business not to exceed $50.0 million in the aggregate
over the life of the Notes (collectively, the "Permitted Consideration");
provided that the amount of (x) any liabilities (as shown on the Issuer's or
such Restricted Subsidiary's most recent balance sheet), of the Issuer or any
Restricted Subsidiary (other than contingent liabilities (except to the extent
reflected (or reserved for) on a balance sheet of the Issuer or any Restricted
Subsidiary as of the date prior to the date of consummation of such transaction)
and liabilities that are by their terms subordinated to the Notes or the Note
Guaranties that are assumed by the transferee of any such assets) and (y) any
securities, notes or other obligations received by the Issuer or any such
Restricted Subsidiary from such transferee that are converted within 90 days by
the Issuer or such Restricted Subsidiary into Permitted Consideration (to the
extent so received), shall be deemed to be Permitted Consideration for purposes
of this provision; and provided further, that the 80% limitation referred to
above shall not apply to any Asset Sale in which the Permitted
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Consideration portion of the consideration received therefor is equal to or
greater than what the net after-tax proceeds would have been had such Asset Sale
complied with the aforementioned 80% limitation.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Issuer may apply such Net Proceeds at its option, (a) to repay Senior
Debt, (b) to secure Letter of Credit Obligations to the extent letters of credit
have not been drawn upon or returned unwithdrawn, (c) to the acquisition of
assets to be used in a Permitted Business and/or (d) to an investment in
properties or assets that replace the properties and assets that are the subject
of such Asset Sale and/or, in the case of a sale of a bowling center or bowling
centers, may deem such Net Proceeds to have been applied pursuant to this clause
(d) to the extent of any expenditures made to acquire, renovate, expand or
construct one or more bowling centers within 365 days preceding the date of the
Asset Sale. Pending the final application of any such Net Proceeds, the Issuer
may temporarily reduce the New Credit Facility or otherwise invest such Net
Proceeds in any manner that is not prohibited by this Indenture. Any Net
Proceeds from Asset Sales that are not applied or invested as provided in the
first sentence of this paragraph will be deemed to constitute "Excess Proceeds."
When the aggregate amount of Excess Proceeds exceeds $25.0 million, the Issuer
shall be required to make an offer to all Holders (an "Asset Sale Offer") to
purchase the maximum principal amount of Notes that may be purchased out of the
Excess Proceeds, at an offer price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest, if any, thereon to
the date of purchase, in accordance with the procedures set forth in Section
3.09. To the extent that the aggregate amount of Notes tendered pursuant to an
Asset Sale Offer is less than the Excess Proceeds, the Issuer may use any
remaining Excess Proceeds for general corporate purposes. If the aggregate
principal amount of Notes surrendered by Holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes to be purchased on a pro
rata basis; provided, however, that the Issuer shall not be obligated to
purchase Notes in denominations other than integral multiples of $1,000. Upon
completion of such offer to purchase, the amount of Excess Proceeds shall be
reset at zero.
Notwithstanding anything to the contrary in this Section 4.10, the
Issuer and its Subsidiaries may transfer assets in any Fiscal Year having a fair
market value not in excess of $10,000,000 in the aggregate in connection with an
exchange pursuant to Internal Revenue Code Section 1031 of such assets for
like-kind assets to be used in the business of the Issuer and its Subsidiaries.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any payment to, or sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or Guaranty with, or for the
benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"),
unless (i) such Affiliate Transaction is set forth in writing and is on terms
that are no less favorable to the Issuer or the relevant Subsidiary than those
that would have been obtained in a comparable transaction by the Issuer or such
Subsidiary with an unrelated Person and (ii) the Issuer delivers to the Trustee
(a) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $5.0 million, a
resolution of the Board of
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Directors set forth in an Officer's Certificate certifying that such Affiliate
Transaction complies with clause (i) above and that such Affiliate Transaction
has been approved by a majority of the members of the Board of Directors and
(b) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $10.0 million, an
opinion as to the fairness to the Holders of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or investment banking
firm of national standing; provided that the following shall not be deemed
Affiliate Transactions:
(i) prepaid expenses and loans or advances to employees and similar
items in the ordinary course of business;
(ii) purchases (and sales) of inventory and services in the ordinary
course of business on terms that are customary in the industry or consistent
with past practices;
(iii) fees, compensation or employee benefit arrangements (including
any grants of securities under employee benefit or option plans) paid to, and
indemnity provided on behalf of, directors, officers or employees of the Issuer
or any Restricted Subsidiary of the Issuer after the date of this Indenture;
(iv) transactions pursuant to agreements in effect on the date of
original issuance of the Notes, including amendments thereto after the issue
date, provided that the terms of any such amendment are not, in the aggregate,
less favorable to the Issuer than the terms of such agreement prior to such
amendment;
(v) any employment agreement (including customary benefits thereunder)
entered into by the Issuer or any of its Restricted Subsidiaries in the ordinary
course of business and consistent with the current market practice or the past
practice of the Issuer or such Restricted Subsidiary;
(vi) transactions between or among the Issuer and/or its wholly owned
subsidiaries and Restricted Subsidiaries; and
(vii) Restricted Payments that are permitted by the provisions of
Section 4.07.
SECTION 4.12. LIENS.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist or become effective any Lien on any asset now owned or hereafter acquired
by the Issuer or that Restricted Subsidiary, or any income or profits therefrom
or assign or convey any right to receive income therefrom, except Permitted
Liens.
SECTION 4.13. LINE OF BUSINESS.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in any business other than Permitted Businesses, except
to such extent as would not be material to the Issuer and its Restricted
Subsidiaries taken as a whole.
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SECTION 4.14. CORPORATE EXISTENCE.
Subject to Article 5 and Article 12 hereof, the Issuer and the
Subsidiary Guarantors shall do or cause to be done all things necessary to
preserve and keep in full force and effect (i) their corporate existences, and
the corporate, partnership or other existence of each of the Restricted
Subsidiaries, in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Issuer or any such Restricted
Subsidiary and (ii) the rights (charter and statutory), licenses and franchises
of the Issuer and the Restricted Subsidiaries; provided, however, that the
Issuer shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Restricted
Subsidiaries, if either: (i) the Issuer shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Issuer and
its Restricted Subsidiaries, taken as a whole, and that the loss thereof is not
adverse in any material respect to the Holders of the Notes; or (ii) the Plan
provided for the termination, dissolution, abandonment or disposal thereof.
Notwithstanding the foregoing, the loss of licenses shall not be deemed a
default under this Section 4.14 provided that such loss is not adverse in any
material respect to the Holders of the Notes.
SECTION 4.15. OFFER TO PURCHASE UPON A CHANGE OF CONTROL TRIGGERING EVENT.
(a) Upon the occurrence of a Change of Control Triggering Event (the
date of the last event required for such Change of Control Triggering Event to
become a Change of Control Triggering Event hereinafter referred to as the
"Change of Control Date"), each Holder shall have the right to require the
Issuer to purchase all or any part (equal to $1,000 or an integral multiple
thereof) of such Holder's Notes pursuant to the offer described below (the
"Change of Control Offer") at an offer price in cash equal to 101% of the
aggregate principal amount thereof to the date of purchase. Within 30 days
following the Change of Control Date, the Issuer shall mail a notice to each
Holder describing the transaction or transactions that constituted the Change of
Control and offering to purchase Notes on the date specified in such notice,
which notice shall comply with Section 3.09 hereof. The Issuer shall comply with
the requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable in connection with the purchase of the Notes as a result of the
Change of Control Triggering Event.
(b) Prior to complying with the provisions of this Section 4.15 and
the applicable provisions of Section 3.09 hereof, but in any event prior to the
Purchase Date, the Issuer shall either repay all outstanding Senior Debt in full
or obtain the requisite consents, if any, under all agreements governing
outstanding Senior Debt to permit the purchase of Notes required by this
covenant. The Issuer shall not be obligated to purchase the Notes pursuant to
Section 4.15(a) until after the Issuer complies with the immediately preceding
sentence but the failure to make such purchases shall constitute an Event of
Default under Section 6.01(c). The Issuer shall publicly announce the results of
the Change of Control Offer on or as soon as practicable after the Purchase
Date.
The Change of Control Triggering Event provisions described in this
Section 4.15 shall be applicable notwithstanding any other provisions of this
Indenture, other than Section 3.09
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hereof, which Section 3.09 shall govern the procedures used in connection with
a Change of Control Offer.
The Issuer shall not be required to make a Change of Control Offer
upon a Change of Control Triggering Event if a third party makes the Change of
Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control Offer
made by the Issuer and purchases all Senior Subordinated Notes validly tendered
and not withdrawn under such Change of Control Offer.
SECTION 4.16. ANTI-LAYERING.
The Issuer and any Restricted Subsidiary shall not incur, create,
issue, assume, Guaranty or otherwise become liable for any Indebtedness that is
both (a) subordinate or junior in right of payment to any Senior Debt and (b)
senior in any respect in right of payment to the Notes. No Subsidiary Guarantor
shall incur, create, issue, assume, Guaranty or otherwise become liable for any
Indebtedness that is both (a) subordinate or junior in right of payment to its
Senior Debt and (b) senior in right of payment to its Note Guaranty.
SECTION 4.17. SALE AND LEASEBACK TRANSACTIONS.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Issuer may enter into a sale and leaseback transaction if (i) the Issuer
could have (a) incurred Indebtedness in an amount equal to the Attributable Debt
relating to such sale and leaseback transaction pursuant to Section 4.09 and (b)
incurred a Lien to secure such Indebtedness pursuant to Section 4.12 and (ii)
the gross cash proceeds of such sale and leaseback transaction are at least
equal to the fair market value (in the case of gross cash proceeds in excess of
$20.0 million as determined in good faith by the Board of Directors and set
forth in an Officer's Certificate delivered to the Trustee) of the property that
is the subject of such sale and leaseback transaction.
SECTION 4.18. LIMITATION ON ISSUANCES AND SALES OF CAPITAL STOCK OF RESTRICTED
SUBSIDIARIES.
The Issuer (i) shall not, and shall not permit any Restricted
Subsidiary of the Issuer to, transfer, convey, sell, lease or otherwise dispose
of any Capital Stock of any Restricted Subsidiary of the Issuer to any Person
(other than the Issuer or a Restricted Subsidiary of the Issuer), unless (a)
such transfer, conveyance, sale, lease or other disposition is of all the
Capital Stock of such Restricted Subsidiary and (b) the cash Net Proceeds from
such transfer, conveyance, sale, lease or other disposition are applied in
accordance with Section 4.10, and (ii) shall not permit any Restricted
Subsidiary of the Issuer to issue any of its Equity Interests (other than, if
necessary, shares of its Capital Stock constituting directors' qualifying
shares) to any Person other than to the Issuer or a Restricted Subsidiary of the
Issuer; provided, however, the foregoing restrictions shall not apply to: (A)
Investments in the entities described under clause (m) of the definition of
Permitted Investments; or (B) transfers, conveyances, sales, leases or other
dispositions (collectively "dispositions") of any Capital Stock of any
Restricted Subsidiary that have a fair market value at the time of such
disposition of less than $5.0 million.
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SECTION 4.19. PAYMENTS FOR CONSENT.
Neither the Issuer nor any of its Restricted Subsidiaries shall,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder of any Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
or is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.20. ADDITIONAL GUARANTIES.
(i) If the Issuer or any of its Restricted Subsidiaries shall, after
the date of this Indenture, transfer or cause to be transferred, including by
way of any Investment, in one or a series of transactions (whether or not
related), any assets, businesses, divisions, real property or equipment having
an aggregate fair market value (as determined in good faith by the Board of
Directors) in excess of $5.0 million to any Restricted Subsidiary that is not a
Subsidiary Guarantor or a Foreign Subsidiary, or (ii) if the Issuer or any of
its Restricted Subsidiaries shall acquire another Restricted Subsidiary other
than a Foreign Subsidiary having total assets with a fair market value (as
determined in good faith by the Board of Directors) in excess of $5.0 million,
or (iii) if any Restricted Subsidiary other than a Foreign Subsidiary shall
incur Acquired Debt in excess of $5.0 million, then the Issuer shall, at the
time of such transfer, acquisition or incurrence, (i) cause such transferee,
acquired Restricted Subsidiary or Restricted Subsidiary incurring Acquired Debt
(if not then a Subsidiary Guarantor) to execute a Note Guaranty of the
Obligations of the Issuer under the Notes in the form set forth in this
Indenture and (ii) deliver to the Trustee an Opinion of Counsel, in form
reasonably satisfactory to the Trustee, that such Note Guaranty is a valid,
binding and enforceable obligation of such transferee, acquired Restricted
Subsidiary or Restricted Subsidiary incurring Acquired Debt, subject to
customary exceptions for bankruptcy, fraudulent conveyance and equitable
principles. Notwithstanding the foregoing, the Issuer or any of its Restricted
Subsidiaries may make a Restricted Investment in any Wholly Owned Restricted
Subsidiary of the Issuer without compliance with this covenant provided that
such Restricted Investment is permitted by Section 4.07.
SECTION 4.21. RATING BY RATING AGENCIES.
The Issuer will use its reasonable best efforts to obtain a rating of
the Notes from Moody's Investor's Service, Inc. or Standard & Poor's Corporation
(or, if at any time neither Moody's Investor's Service, Inc. nor Standard &
Poor's Corporation shall be rating such obligations, then from another
nationally recognized rating agency, reasonably acceptable to the Trustee)
within 90 days from the date of this Indenture.
ARTICLE 5.
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Issuer shall not consolidate or merge with or into (whether or not
the Issuer is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions, to another Person
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unless (i) the Issuer is the surviving corporation or the entity or the Person
formed by or surviving any such consolidation or merger (if other than the
Issuer) or to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made is organized and existing under the laws of the
United States, any state thereof or the District of Columbia; (ii) the entity or
Person formed by or surviving any such consolidation or merger (if other than
such Issuer), or the Person to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made, assumes all the
obligations of such Issuer under the Notes and this Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee; (iii)
immediately after such transaction no Default or Event of Default exists; and
(iv) except in the case of a merger of the Issuer with or into one of its Wholly
Owned Restricted Subsidiaries, the Issuer or the entity or Person formed by or
surviving any such consolidation or merger (if other than the Issuer), or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made shall, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, (A) be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio
test set forth in the first paragraph of Section 4.09 hereof and (B) have a
Consolidated Net Worth in an amount which is not less than the Consolidated Net
Worth of the Issuer immediately prior to such transaction. Notwithstanding the
foregoing clauses (iii) and (iv), (a) any Restricted Subsidiary may consolidate
with, merge into or transfer all or part of its properties and assets to the
Issuer and (b) the Issuer may merge with an Affiliate incorporated solely for
the purpose of reincorporating the Issuer in another jurisdiction. In the case
of a sale, assignment, lease, transfer, conveyance or other disposition of all
or substantially all of the assets of the Issuer, upon the assumption provided
for in clause (ii) above, the Issuer shall be discharged from all further
liability and obligation under this Indenture.
Prior to the proposed transaction, the Issuer shall deliver to the
Trustee an Officer's Certificate and an Opinion of Counsel each of which shall
state that such consolidation, merger or transfer and such supplemental
indenture comply with this Article 5 and that all conditions precedent herein
provided for relating to such transaction have been complied with.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Issuer in accordance with Section 5.01 hereof, the successor Person
formed by such consolidation or into or with which the Issuer is merged or to
which such sale, assignment, transfer, lease, conveyance or other disposition is
made shall succeed to, and be substituted for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Issuer" shall refer instead to
such successor and not to the Issuer), and may exercise every right and power of
the Issuer under this Indenture with the same effect as if such successor Person
had been named as the Issuer herein; provided, however, that the predecessor
Issuer shall not be relieved from the obligation to pay the principal of and
interest on the Notes except in the case of a sale of all or substantially all
of the Issuer's assets as provided in the last sentence of the first paragraph
of Section 5.01 hereof.
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ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Issuer defaults for 30 days in the payment when due of
interest on the Notes (whether or not prohibited by the subordination provisions
of this Indenture);
(b) the Issuer defaults in payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of this Indenture);
(c) the Issuer fails, and such failure continues for 30 days after
notice from the Trustee, to comply with the Issuer's obligations to be performed
pursuant to Section 4.10, 4.15 or Article 5 hereof;
(d) the Issuer fails for 60 days after notice to comply with any of
its other agreements in this Indenture or the Notes;
(e) the Issuer defaults under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Issuer or any of its Restricted
Subsidiaries (or the payment of which is Guarantied by the Issuer or any of its
Restricted Subsidiaries) whether such Indebtedness or Guaranty now exists, or is
created after the date of this Indenture, which default (i) is caused by a
failure to pay principal at final maturity or (ii) results in the acceleration
of such Indebtedness prior to its Stated Maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal amount of
any other such Indebtedness the Stated Maturity of which has been so
accelerated, aggregates $25.0 million or more;
(f) the Issuer or any of its Significant Subsidiaries, or a group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary,
fails to pay final judgments aggregating in excess of $25.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days after entry
thereof;
(g) the Issuer or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case;
(ii) consents to the entry of an order for relief against it in
an involuntary case;
(iii) consents to the appointment of a custodian of it or for all
or substantially all of its property;
(iv) makes a general assignment for the benefit of its creditors;
or
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(v) admits in writing its inability to pay its debts as they
become due;
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary in an involuntary case;
(ii) appoints a custodian of the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Issuer or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary;
or
(iii) orders the liquidation of the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
SECTION 6.02. ACCELERATION.
If any Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable immediately; provided, however, that
in the event of an acceleration based upon an Event of Default set forth in
Section 6.01(e) above, such declaration of acceleration shall be automatically
annulled if the holders of Indebtedness which is the subject of acceleration
have rescinded their declaration of acceleration in respect of such
Indebtedness. Notwithstanding the foregoing, in the case of an Event of Default
as described in clause (g) or (h) of Section 6.01 hereof all outstanding Notes
will become due and payable without further action or notice. Holders of the
Notes may not enforce this Indenture or the Notes except as provided in this
Indenture. Subject to the limitations set forth in Section 6.05 hereof, Holders
of a majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of the Notes notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal or
interest) if it determines that withholding notice is in their interest.
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by written notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except (i) a continuing Default or Event of Default
in the payment of the principal of or premium or interest on the Notes (provided
that the Holders of at least a majority in aggregate principal amount of the
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration) and (ii) a default with
respect to a provision that under Section 9.02 cannot be amended without the
consent of each Holder affected. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising 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 or that the Trustee determines may be
unduly prejudicial to the rights of other Holders or that may involve the
Trustee in personal liability and may take any other action it deems proper that
is not inconsistent with any such direction received from such Holders of the
Notes. In addition, prior to taking any action hereunder, the Trustee shall be
entitled to indemnification from the Holders on terms reasonably satisfactory to
Trustee in its sole discretion against all losses and expenses arising from
taking or not taking such action.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture
or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders offer and, if requested, provide
to the Trustee indemnity satisfactory to the Trustee against any loss, liability
or expense; (d) 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
(d) 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
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
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A Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and interest on
the Notes, on or after the respective due dates expressed in the Notes
(including in connection with a Purchase Offer), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Issuer for the whole amount of
principal of, premium and interest remaining unpaid on the Notes and interest on
overdue principal and, to the extent lawful, interest 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 is authorized to 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
Holders of the Notes allowed in any judicial proceedings relative to the Issuer
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder 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 Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
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SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to holders of Senior Debt to the extent required by Article 11
or Article 13 hereof;
Third: to Holders for amounts due and unpaid on the Notes for
principal, premium and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Notes for principal,
premium and interest, respectively; and
Fourth: to the Issuer or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders 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 a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees 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 does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of 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 its exercise of such rights and powers,
as a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only those
duties that are specifically set forth in this Indenture and no others, and no
implied covenants or obligations shall be read into this Indenture against the
Trustee; and
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(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, on certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture. However, the Trustee shall
be under a duty to examine any such certificates or opinions to determine
whether or not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations or other facts
stated therein).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), (c), and (e) of this Section 7.01 and Section 7.02.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuer. 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.
(a) The Trustee may conclusively rely on any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officer's Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its selection and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed by it
with due care.
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(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture; provided that the Trustee's conduct
does not constitute willful misconduct or negligence.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Issuer or the Subsidiary
Guarantors shall be sufficient if signed by an Officer of any Issuer or any
Subsidiary Guarantor, as applicable.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
(g) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event that is in fact such a
default is received by the Trustee, and such notice references the Notes and
this Indenture.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuer, the Subsidiary
Guarantors or any Affiliate of the Issuer or the Subsidiary Guarantors with the
same rights it would have if it were not Trustee. However, in the event that the
Trustee acquires any conflicting interest it must eliminate such conflict within
90 days, apply to the SEC for permission to continue as trustee or resign, if
necessary. Any Agent may do the same with like rights and duties. The Trustee is
also subject to Sections 7.10 and 7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes or any money
paid to the Issuer or upon the Issuer's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and is known
to the Trustee, the Trustee shall mail to Holders a notice of the Default or
Event of Default within 30 days after it occurs. Except in the case of a Default
or Event of Default in payment of principal of, premium, if any, or interest on
any Note, the Trustee may withhold the notice if and so long as a committee of
its Responsible Officers in good faith determines that withholding the notice is
in the interest of the Holders of the Notes.
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SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss. 313(a) (but if no event described in
TIA ss. 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders shall
be mailed to the Issuer and filed with the SEC and each stock exchange, if any,
on which the Notes are listed in accordance with TIA ss. 313(d). The Issuer
shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Issuer shall pay to the Trustee from time to time such
compensation as the Trustee and the Issuer and shall from time to time agree in
writing for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel. The Issuer shall indemnify each of the Trustee and any
predecessor Trustee against any and all losses, liabilities, damages, claims or
expenses (including reasonable attorneys' fees or taxes (other than taxes based
on the income of the Trustee)) incurred by it arising out of or in connection
with the acceptance or administration of the Indenture and the performance of
its duties under this Indenture, including the costs and expenses of enforcing
this Indenture against the Issuer (including this Section 7.07) and defending
itself against any claim (whether asserted by the Issuer, or any Holder or any
other Person) or liability in connection with the exercise or performance of any
of its powers or duties hereunder, except to the extent any such loss, liability
or expense may be attributable to its negligence, willful misconduct or bad
faith. The Trustee shall notify the Issuer promptly of any claim for which it
may seek indemnity. Failure by the Trustee to so notify the Issuer shall not
relieve the Issuer of its obligations hereunder. The Issuer shall defend the
claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Issuer shall pay the reasonable fees and expenses of
such counsel. The Issuer need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld. The Issuer need not
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Trustee through the Trustee's own willful misconduct, negligence
or bad faith.
The obligations of the Issuer under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the payment obligations of the Issuer in this Section, the
Trustee shall have a Lien prior to the claims of the Holders of the Notes on all
money or property held or collected by
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the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such Lien shall survive the satisfaction and discharge of this
Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign at any time and be discharged from the trust
hereby created by so notifying the Issuer in writing. The Holders of a majority
in principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Issuer in writing. The Issuer may remove the
Trustee without prior notice and without liability to the Issuer by notifying
the Trustee in writing if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) 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 Issuer 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 then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Issuer.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer, or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition, at the expense of the Issuer, any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10, such Holder of a Note may petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, if all sums owing
to the Trustee hereunder have been paid and subject to the Lien provided for in
Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Issuer's obligations under Section 7.07 hereof shall continue
for the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Issuer may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officer's Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Issuer's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Issuer and the Subsidiary Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their
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obligations with respect to all outstanding Notes on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Issuer and the Subsidiary Guarantors shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all their other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Issuer and the Subsidiary Guarantors, shall execute
proper instruments acknowledging the same), except for the following provisions
which shall survive until otherwise terminated or discharged hereunder or until
the Notes have been paid in full: (a) the rights of Holders of outstanding Notes
to receive solely from the trust fund described in Section 8.05 hereof, and as
more fully set forth in such Section, payments in respect of the principal of,
premium, if any, and interest on such Notes when such payments are due, (b) the
Issuer's and the Subsidiary Guarantors' obligations with respect to such Notes
under Article 2 and Section 4.02 hereof, (c) the rights, powers, trusts, duties
and immunities of the Trustee hereunder and the Issuer's and the Subsidiary
Guarantors' obligations in connection therewith and (d) this Article 8. Subject
to compliance with this Article 8, the Issuer may exercise its option under this
Section 8.02 notwithstanding the prior exercise of its option under Section 8.03
hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Issuer's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Issuer and the Subsidiary Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be released from their obligations under the covenants set forth in Article 4
hereof except for Sections 4.01 and 4.02 and, to the extent required by law,
4.04, and, with respect to the outstanding Notes on and after the date the
conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Issuer and the Subsidiary Guarantors may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Issuer's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03, subject to the satisfaction of the conditions set forth in Section
8.04 hereof, Sections 6.01(c) through (h) hereof shall not constitute Events of
Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes. In order to exercise
either Legal Defeasance or Covenant Defeasance:
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(a) the Issuer must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in United States dollars, non-callable
United States Government Obligations, or a combination thereof, in such amounts
as shall be 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 the principal of, premium, if any, and interest
on the outstanding Notes on the stated date for payment thereof or on the
applicable redemption date, as the case may be, and the Issuer must specify
whether the Notes are being defeased to maturity or to a particular redemption
date;
(b) in the case of an election under Section 8.02 hereof, the Issuer
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Issuer has received
from, or there has been published by, the Internal Revenue Service a ruling or
(B) since the date of this Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes
shall not recognize income, gain or loss for federal income tax purposes as a
result of such Legal Defeasance and shall be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the Issuer
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes shall not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and shall be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall occur under Section 6.01(g)
or 6.01(h) hereof at any time in the period ending on the 91st day after the
date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Issuer or any of its
Restricted Subsidiaries is a party or by which the Issuer or any of its
Restricted Subsidiaries is bound;
(f) on the 123rd day following the deposit, the trust funds shall not
be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally;
(g) the Issuer shall have delivered to the Trustee an Officer's
Certificate stating that (a) the deposit will not be subject to any rights of
the holders of Senior Debt and (b) the deposit was not made by the Issuer with
the intent of preferring the Holders over any other creditors of the Issuer or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Issuer; and
(h) the Issuer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
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SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT OBLIGATIONS TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and United States Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Issuer acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or securities deposited
pursuant to Section 8.04 hereof or the principal 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 Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon the request of
the Issuer any money or securities held by it as provided in Section 8.04 hereof
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written ___ certification ___ thereof ___ delivered
to the Trustee (which may be the opinion delivered under Section 8.04(a)
hereof), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.06. REPAYMENT TO ISSUER.
The Trustee and the Paying Agent shall promptly pay to the Issuer upon
written request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Issuer upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Issuer shall have either caused
notice of such payment to be mailed to each Holder of the Notes entitled thereto
no less than 30 days prior to such repayment or within such period shall have
published such notice in a financial newspaper of widespread circulation
published in the City of New York including, without limitation, The Wall Street
Journal. After payment to the Issuer, Holders of the Notes entitled to the money
must look to the Issuer for payment as general creditors unless an applicable
abandoned property law designates another Person, and all liability of the
Trustee and such Paying Agent with respect to such money shall cease.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or United
States Government Obligations in accordance with Section 8.02 or 8.03, as the
case may be, 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, then the Issuer's
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obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03, as the case
may be, until such time as the Trustee or Paying Agent is permitted to apply all
such money or United States Government Obligations in accordance with Section
8.02 or 8.03, as the case may be; provided, however, that if the Issuer has made
any payment of interest on or principal of any Notes because of the
reinstatement of its obligations, the Issuer shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money or United
States Government Obligations held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding the provisions of Section 9.02 hereof, the Issuer and
the Trustee may amend or supplement this Indenture or the Notes without the
consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes in a manner that does not materially adversely affect any
Holder;
(c) to provide for the assumption of the Issuer's obligations to the
Holders by a successor to the Issuer pursuant to Article 5 hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders or that does not adversely affect the legal rights
hereunder of any Holder; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
Upon the request of the Issuer accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Issuer 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, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES
Except as provided below in this Section 9.02, Section 11.13 or
Section 13.13, the Issuer and the Trustee may amend or supplement this Indenture
and the Notes may be amended or supplemented with the consent of the Holders of
at least a majority in principal amount of the Notes then outstanding voting as
a single class (including consents obtained in connection with a tender offer or
exchange offer for, or purchase of, the Notes), and, subject to Sections 6.04
and 6.07 hereof, any existing Default or Event of Default (other than a Default
or Event of Default in
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the payment of the principal of, premium, if any, or interest on the Notes,
except a payment default resulting from an acceleration that has been rescinded)
or compliance with any provision of this Indenture or the Notes may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes, voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes).
Upon the request of the Issuer accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders as aforesaid, and upon receipt by the
Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Issuer in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.02 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 becomes
effective, the Issuer shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Issuer to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amended or supplemental Indenture
or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority
in aggregate principal amount of the Notes then outstanding voting as a single
class may waive compliance in a particular instance by the Issuer with any
provision of this Indenture or the Notes. However, without the consent of each
Holder affected, an amendment or waiver under this Section 9.02 may not (with
respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter or waive any of the provisions with respect to the redemption of the
Notes;
(c) reduce the rate of or extend the time for payment of interest,
including default interest, on any Note;
(d) make any Note payable in money other than that stated in the
Notes; or
(e) make any change in the provisions of this Indenture governing
waivers of past Defaults or the rights of Holders to receive payments of
principal of or interest on the Notes.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in an amended or supplemental Indenture that complies with the TIA as
then in effect.
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SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder or portion of a Note that evidences the same debt as the consenting
Holder's Note, even if notation of the consent is not made on any Note. However,
any such Holder of a Note or subsequent Holder may revoke the consent as to its
Note if the Trustee receives written notice of revocation before the date the
waiver, supplement or amendment becomes effective. An amendment, supplement or
waiver becomes effective on receipt by the Trustee of written consents from the
Holders of the requisite percentage in principal amount of the outstanding Notes
in accordance with its terms and thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders of Notes entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then,
notwithstanding the last two sentences of the immediately preceding paragraph,
those Persons who were Holders of Notes 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 Notes after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Issuer in
exchange for all Notes may issue and the Trustee shall, upon receipt of written
instructions signed by an Officer of the Issuer, authenticate new Notes that
reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Issuer may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon an Officer's Certificate and an Opinion
of Counsel stating that the execution of such amended or supplemental indenture
is authorized or permitted by this Indenture.
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ARTICLE 10.
DISCHARGE OF INDENTURE
SECTION 10.01. TERMINATION OF ISSUER'S OBLIGATIONS.
This Indenture shall cease to be of further effect (except that the
Issuer's and the Subsidiary Guarantors' obligations under Section 7.07 and 10.04
and the Issuer's, Trustee's and Paying Agent's obligations under Section 10.03
shall survive) when all outstanding Notes theretofore authenticated and issued
have been delivered (other than destroyed, lost or stolen Notes that have been
replaced or paid) to the Trustee for cancellation and the Issuer has paid all
sums payable by the Issuer hereunder. In addition, the Issuer may terminate all
of its obligations under this Indenture if:
(1) the Issuer irrevocably deposits in trust with the Trustee, or at
the option of the Trustee with a trustee reasonably satisfactory to the Trustee
and the Issuer under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee, money or United States Government
Obligations sufficient (as certified by an independent public accountant
designated by the Issuer) to pay principal and interest on the Notes to maturity
or redemption, as the case may be, and to pay all other sums payable by them
hereunder, provided that (i) the trustee of the irrevocable trust shall have
been irrevocably instructed to pay such money or the proceeds of such United
States Government Obligations to the Trustee and (ii) the Trustee shall have
been irrevocably instructed to apply such money or the proceeds of such United
States Government Obligations to the payment of said principal and interest with
respect to the Notes;
(2) the Issuer and the Subsidiary Guarantors deliver to the Trustee an
Officer's Certificate stating that all conditions precedent to satisfaction and
discharge of this Indenture have been complied with, and an Opinion of Counsel
to the same effect; and
(3) no Event of Default or event (including such deposit) which, with
notice or lapse of time, or both, would become an Event of Default with respect
to the Notes shall have occurred and be continuing on the date of such deposit.
Then, this Indenture shall cease to be of further effect (except as provided in
this paragraph), and the Trustee, on demand of the Issuer, shall execute proper
instruments acknowledging confirmation of and discharge under this Indenture.
The Issuer may make the deposit only if Article 11 hereof does not prohibit such
payment. However, the Issuer's obligations in Sections 2.03, 2.04, 2.05, 2.06,
2.07, 4.01, 7.07, 7.08, 10.03 and 10.04, and the Trustee's and Paying Agent's
obligations in Section 10.03 shall survive until the Notes are no longer
outstanding. Thereafter, only the Issuer's, Trustee's and Paying Agents'
obligations in Section 10.03 shall survive.
After such irrevocable deposit made pursuant to this Section 10.01 and
satisfaction of the other conditions set forth herein, the Trustee upon request
shall acknowledge in writing the discharge of the Issuer's and the Subsidiary
Guarantors' obligations under this Indenture except for those surviving
obligations specified above.
In order to have money available on a payment date to pay principal or
interest on the Notes, the United States Government Obligations shall be payable
as to principal or interest at
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least one Business Day before such payment date in such amounts as will provide
the necessary money.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the United States Government
Obligations deposited pursuant to this Section 10.01 or the principal 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 outstanding Notes.
SECTION 10.02. APPLICATION OF TRUST MONEY.
The Trustee or a trustee satisfactory to the Trustee and the Issuer
shall hold in trust money or United States Government Obligations deposited with
it pursuant to Section 10.01. It shall apply the deposited money and the money
from United States Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal and interest on the
Notes.
SECTION 10.03. REPAYMENT TO ISSUER.
The Trustee and the Paying Agent shall promptly pay to the Issuer upon
written request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Issuer upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Issuer shall have either caused
notice of such payment to be mailed to each Holder of the Notes entitled thereto
no less than 30 days prior to such repayment or within such period shall have
published such notice in a financial newspaper of widespread circulation
published in the City of New York, including, without limitation, The Wall
Street Journal. After payment to the Issuer, Holders of the Notes entitled to
the money must look to the Issuer for payment as general creditors unless an
applicable abandoned property law designates another Person, and all liability
of the Trustee and such Paying Agent with respect to such money shall cease.
SECTION 10.04. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or United
States Government Obligations in accordance with Section 10.02 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Issuer's obligations under this Indenture and the Notes shall
be revived and reinstated as though no deposit had occurred pursuant to Section
10.01 until such time as the Trustee or Paying Agent is permitted to apply all
such money or United States Government Obligations in accordance with Section
10.02; provided, however, that if the Issuer has made any payment of interest on
or principal of any Notes because of the reinstatement of its obligations, the
Issuer shall be subrogated to the rights of the Holders of such Notes to receive
such payment from the money or United States Government Obligations held by the
Trustee or Paying Agent.
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ARTICLE 11.
SUBORDINATION
SECTION 11.01. AGREEMENT TO SUBORDINATE.
The Issuer and each Holder by accepting a Note irrevocably agree that
the Indebtedness evidenced by the Notes is subordinated in right of payment, to
the extent and in the manner provided in this Article, to the prior payment in
full of all Senior Debt (whether outstanding on the date hereof or hereafter
created, incurred, assumed or guaranteed), and that the subordination is for the
benefit of the holders of Senior Debt.
SECTION 11.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any payment or distribution of assets of the Issuer of any kind
or character, whether in cash, property or securities, to creditors in any
Insolvency or Liquidation Proceeding with respect to the Issuer, all amounts due
or to become due under or with respect to all Senior Debt (including Accrued
Bankruptcy Interest and collateralization of all Letter of Credit Obligations)
shall first be paid in full before any payment, repurchase of or distribution of
assets is made on account of the Notes, except that the Holders may receive
Subsequent Reorganization Securities. Upon any such Insolvency or Liquidation
Proceeding, any payment or distribution of assets of the Issuer of any kind or
character, whether in cash, property or securities (other than Subsequent
Reorganization Securities), to which the Holders of the Notes or the Trustee
would be entitled shall be paid by the Issuer or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders of the Notes or by the Trustee if received by
them, directly to the holders of Senior Debt (pro rata to such holders on the
basis of the amounts of Senior Debt (including Accrued Bankruptcy Interest and
collateralization of all Letter of Credit Obligations) held by such holders) or
their Representative or Representatives, as their interests may appear, for
application to the payment of the Senior Debt remaining unpaid until all such
Senior Debt has been paid in full, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of Senior
Debt.
SECTION 11.03. DEFAULT ON DESIGNATED SENIOR DEBT.
(a) In the event of and during the continuation of any default in the
payment of principal of, interest or premium, if any, on any Senior Debt, or any
Obligation owing from time to time under or in respect of Senior Debt, or if any
event of default (other than a payment default) with respect to any Senior Debt
shall have occurred and be continuing and shall have resulted in such Senior
Debt becoming or being declared due and payable prior to the date on which it
would otherwise have become due and payable, or (b) if any event of default
other than as described in clause (a) above with respect to any Designated
Senior Debt shall have occurred and be continuing permitting the holders of such
Designated Senior Debt (or their Representative or Representatives) to declare
such Designated Senior Debt due and payable prior to the date on which it would
otherwise have become due and payable, then no payment shall be made by or on
behalf of the Issuer on account of the Notes (other than payments in the form of
Subsequent Reorganization Securities) (x) in case of any payment or nonpayment
default specified in (a), unless and until such default shall have been cured or
waived in writing in accordance with the instruments governing such Senior Debt
or such acceleration shall have been rescinded or
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annulled, or (y) in case of any nonpayment event of default specified in (b),
during the period (a "Payment Blockage Period") commencing on the date the
Issuer and the Subsidiary Guarantors or the Trustee receive written notice of
such event of default (which notice shall be binding on the Trustee and the
Holders as to the occurrence of such a payment default or nonpayment event of
default) from the Credit Agent (or other holders of Designated Senior Debt or
their Representative or Representatives) and ending on the earliest of (A) 179
days after such date, (B) the date, if any, on which such Designated Senior Debt
to which such default relates is paid in full or such default is cured or waived
in writing in accordance with the instruments governing such Designated Senior
Debt by the holders of such Designated Senior Debt and (C) the date on which the
Trustee receives written notice from the Credit Agent (or other holders of
Designated Senior Debt or their Representative or Representatives), as the case
may be, terminating the Payment Blockage Period. During any consecutive 360-day
period, the aggregate of all Payment Blockage Periods shall not exceed 179 days
and there shall be a period of at least 181 consecutive days in each consecutive
360-day period when no Payment Blockage Period is in effect. No event of default
that existed or was continuing with respect to the Senior Debt to which notice
commencing a Payment Blockage Period was given on the date such Payment Blockage
Period commenced shall be, or be made the basis for, the commencement of any
subsequent Payment Blockage Period unless such event of default is cured or
waived for a period of not less than 90 consecutive days; provided that an event
of default for failure to comply with a financial or performance covenant for an
accounting period shall be deemed a different event of default than the failure
to comply with such covenant in a prior accounting period.
SECTION 11.04. ACCELERATION OF NOTES.
If payment of the Notes is accelerated because of an Event of Default,
the Issuer shall promptly notify holders of Senior Debt of the acceleration.
SECTION 11.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If the Trustee or any Holder of a Note receives any payment or
distribution on account of any Obligations with respect to the Notes or
acquisition, repurchase, redemption, retirement or defeasance of any of the
Notes shall be made by or on behalf of the Company (including any payments or
distribution by any liquidating trustee or agent or other Person in a proceeding
referred to in Section 11.02) and received by the Trustee or any Holder at a
time when such payment or distribution was prohibited by the provisions of
Section 11.02 or 11.03 or such payment or distribution was required to be made
to holders of Senior Debt or their Representative, then, such payment or
distribution shall be received, segregated from other funds or assets and held
in trust by the Trustee or such Holder, as the case may be, for the benefit of,
and shall be promptly paid or delivered over to, the holders of Senior Debt or
their Representative, ratably in accordance with the respective amounts of the
principal of such Senior Debt, interest (including Accrued Bankruptcy Interest)
thereon and all other Obligations with respect thereto held or represented by
each, until the principal of all Senior Debt, interest (including Accrued
Bankruptcy Interest) thereon and all other Obligations with respect thereto have
been paid in full and all outstanding Letter of Credit Obligations have been
fully collateralized. Any distribution to the holders of Senior Debt or their
Representative of assets may be held by such holders or such Representatives as
additional collateral without any duty to
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any Holder to liquidate or otherwise realize on such assets or to apply such
assets to any Senior Debt or other Obligations relating thereto.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically set
forth in this Article 11, and no implied covenants or obligations with respect
to the holders of Senior Debt 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 Debt, and shall not be liable to any such holders if the
Trustee shall pay over or distribute to or on behalf of Holders of the Notes or
the Issuer or any other Person money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 11, except if such payment is
made as a result of the willful misconduct or gross negligence of the Trustee.
SECTION 11.06. NOTICE BY THE ISSUER.
The Issuer shall promptly notify the Trustee and the Paying Agent of
any facts known to the Issuer that would cause a payment of any Obligations with
respect to the Notes to violate this Article 11, but failure to give such notice
shall not affect the subordination of the Notes to the Senior Debt as provided
in this Article.
SECTION 11.07. SUBROGATION.
After all Senior Debt (including Accrued Bankruptcy Interest) is paid
in full and until the Notes are paid in full, Holders of the Notes shall be
subrogated (equally and ratably with all other Pari Passu Debt) to the rights of
holders of Senior Debt to receive distributions applicable to Senior Debt to the
extent that distributions otherwise payable to the Holders of the Notes have
been applied to the payment of Senior Debt. A distribution made under this
Article to holders of Senior Debt that otherwise would have been made to Holders
of the Notes is not, as between the Issuer and Holders of the Notes, a payment
by the Issuer on the Notes.
SECTION 11.08. RELATIVE RIGHTS.
This Article defines the relative rights of Holders of the Notes and
holders of Senior Debt. Nothing in this Indenture shall:
(1) impair, as between the Issuer and Holders of the Notes, the
obligations of the Issuer, which are absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of the Notes and creditors
of the Issuer other than their rights in relation to holders of Senior Debt; or
(3) prevent the Trustee or any Holder of the Notes from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Debt to receive distributions and payments
otherwise payable to Holders of the Notes.
If the Issuer fails because of this Article to pay principal of or
interest on a Note on the due date, the failure is still a Default or Event of
Default.
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SECTION 11.09. SUBORDINATION MAY NOT BE IMPAIRED BY THE ISSUER.
No right of any holder of Senior Debt to enforce the subordination of
the Indebtedness evidenced by the Notes shall be impaired by any act or failure
to act by the Issuer or any Holder or by the failure of the Issuer or any Holder
to comply with this Indenture.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt, or any of them, may, at any time and from time to
time, without the consent of or notice to the Holders of the Notes, without
incurring any liabilities to any Holder of any Notes and without impairing or
releasing the subordination and other benefits provided in this Indenture or the
obligations of the Holders of the Notes to the holders of the Senior Debt, even
if any right of reimbursement or subrogation or other right or remedy of any
Holder is affected, impaired or extinguished thereby, do any one or more of the
following:
(1) change the manner, place or terms of payment or change or extend
the time of payment of, or renew, exchange, amend, increase or alter, the terms
of any Senior Debt, any security therefor or guaranty thereof or any liability
of any obligor thereon (including any guarantor) to such holder, or any
liability incurred directly or indirectly in respect thereof or otherwise amend,
renew, exchange, extend, modify, increase or supplement in any manner any Senior
Debt or any instrument that evidences or guaranties or secures the same or any
agreement under which Senior Debt is outstanding;
(2) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and in any order any property pledged,
mortgaged or otherwise securing Senior Debt or any liability of any obligor
thereon, to such holder, or any liability incurred directly or indirectly in
respect thereof;
(3) settle or compromise any Senior Debt or any other liability of any
obligor of the Senior Debt to such holder or any security therefor or any
liability incurred directly or indirectly in respect thereof and apply any sums
by whomsoever paid and however realized to any liability (including, without
limitation, Senior Debt) in any manner or order; and
(4) fail to take or to record or to otherwise perfect, for any reason
or for no reason, any lien or security interest securing Senior Debt by
whomsoever granted, exercise or delay in or refrain from exercising any right or
remedy against any obligor or any guarantor or any other Person, elect any
remedy and otherwise deal freely with any obligor and any security for the
Senior Debt or any liability of any obligor to such holder or any liability
incurred directly or indirectly in respect thereof, it being acknowledged that
the Notes are not entitled to the benefit of any collateral or assets owned by
or purported to be owned by the Issuer or any of its Subsidiaries and pledged to
or purported to be pledged to the Credit Agent for the benefit of the holders of
Indebtedness under the New Credit Facility, until the payment in full of such
Designated Senior Debt and the termination of all commitments thereunder.
SECTION 11.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Debt, the distribution may be made and the notice given to their
Representative.
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Upon any payment or distribution of assets of the Issuer referred to
in this Article 11, the Trustee and the Holders of the Notes shall be entitled
to rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
of the Notes for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Debt and other Indebtedness of
the Issuer, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 11.
SECTION 11.11. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 11 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless the Trustee shall have received at its
Corporate Trust Office at least three Business Days prior to the date of such
payment written notice of facts that would cause the payment of any Obligations
with respect to the Notes to violate this Article 11; and, prior to the receipt
of any such written notice, the Trustee shall be entitled to assume that no such
facts exist; provided, however, that if the Trustee shall not have received such
written notice prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of, premium, if any, or interest on any Note or other Obligations
under this Indenture), then, anything herein contained to the contrary
notwithstanding, but without limiting the rights and remedies of the holders of
Senior Debt or any trustee, fiduciary or agent thereof, the Trustee shall have
full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it after such date, nor shall
the Trustee be charged with knowledge of the curing of any such default or the
elimination of the act or condition preventing any such payment unless and until
the Trustee shall have received an Officer's Certificate to such effect. Only
the Issuer or a Representative may give the notice. Nothing in this Article 11
shall impair the claims of, or payments to, the Trustee under or pursuant to
Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Debt with the same rights it would have if it were not Trustee. Any Agent may do
the same with like rights.
SECTION 11.12. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Note by the Holder's acceptance thereof authorizes
and directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 11, and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes, including without limitation the timely filing of a
claim for the unpaid balance of the Notes held by such Holder in the form
required in any Insolvency or Liquidation Proceeding and causing such claim to
be approved. If the Trustee does not file a proper proof of claim or proof of
debt in the form required in any proceeding referred to in Section 6.09 hereof
at least 30 days before the expiration of the time of such claim, the
Representatives of the Designated Senior Debt, including the Credit Agent, are
hereby authorized to file an appropriate claim for and on behalf of the Holders
of the Notes.
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SECTION 11.13. AMENDMENTS
Any amendment to the provisions of this Article 11 shall require the
consent of the holders of all of the Senior Debt (or the Representatives of such
holders, as applicable) whose rights would be adversely affected by such
amendment.
ARTICLE 12.
GUARANTY OF NOTES
SECTION 12.01. NOTE GUARANTY.
Subject to Section 12.06 hereof, each of the Subsidiary Guarantors
hereby, jointly and severally, unconditionally guaranties to each Holder of a
Note authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of this
Indenture, the Notes and the Obligations of the Issuer hereunder and thereunder,
that: (a) the principal of, premium, if any, and interest on the Notes will be
promptly paid in full when due, subject to any applicable grace period, whether
at maturity, by acceleration, redemption or otherwise, and interest on the
overdue principal, premium, if any, (to the extent permitted by law) interest on
any interest, if any, on the Notes, and all other payment Obligations of the
Issuer to the Holders or the Trustee hereunder or thereunder will be promptly
paid in full and performed, all in accordance with the terms hereof and thereof;
and (b) in case of any extension of time of payment or renewal of any Notes or
any of such other Obligations, the same will be promptly paid in full when due
or performed in accordance with the terms of the extension or renewal, subject
to any applicable grace period, whether at stated maturity, by acceleration,
redemption or otherwise. Failing payment when so due of any amount so guaranteed
for whatever reason the Subsidiary Guarantors will be jointly and severally
obligated to pay the same immediately. An Event of Default under this Indenture
or the Notes shall constitute an event of default under the Note Guaranties, and
shall entitle the Holders to accelerate the Obligations of the Subsidiary
Guarantors hereunder in the same manner and to the same extent as the
Obligations of the Issuer. The Subsidiary Guarantors hereby agree that their
Obligations ___ hereunder shall be unconditional, ___ irrespective of the
validity, ___ regularity or enforceability of the Notes or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
with respect to any provisions hereof or thereof, the recovery of any judgment
against the Issuer, any action to enforce the same or any other circumstance
that might otherwise constitute a legal or equitable discharge or defense of a
Subsidiary Guarantor. Each Subsidiary Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Issuer, any right to require a proceeding first
against the Issuer, protest, notice and all demands whatsoever and covenants
that this Note Guaranty will not be discharged except by complete performance of
the Obligations contained in the Notes and this Indenture. If any Holder or the
Trustee is required by any court or otherwise to return to the Issuer, the
Subsidiary Guarantors, or any Note Custodian, Trustee, liquidator or other
similar official acting in relation to either the Issuer or the Subsidiary
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guaranty, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Subsidiary Guarantor agrees that it shall not be entitled
to, and hereby waives, any right of subrogation in relation to the Holders in
respect of any Obligations guaranteed hereby. Each Subsidiary Guarantor further
agrees that, as between the Subsidiary Guarantors, on the one hand, and the
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Holders and the Trustee, on the other hand, (x) the maturity of the Obligations
guarantied hereby may be accelerated as provided in Article 6 for the purposes
of this Note Guaranty, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Obligations guaranteed hereby,
and (y) in the event of any declaration of acceleration of such Obligations as
provided in Article 6 hereof, such Obligations (whether or not due and payable)
shall forthwith become due and payable by the Subsidiary Guarantors for the
purpose of this Note Guaranty. The Subsidiary Guarantors shall have the right to
seek contribution from any non-paying Subsidiary Guarantor so long as the
exercise of such right does not impair the rights of the Holders under the Note
Guaranties.
SECTION 12.02. EXECUTION AND DELIVERY OF NOTE GUARANTY.
To evidence its Note Guaranty set forth in Section 12.01, each
Subsidiary Guarantor hereby agrees that a notation of such Note Guaranty
substantially in the form of Exhibit B shall be endorsed by an Officer of such
Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of such Subsidiary Guarantor, by
manual or facsimile signature, by an Officer of such Subsidiary Guarantor.
Each Subsidiary Guarantor hereby agrees that its Note Guaranty set
forth in Section 12.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guaranty.
If an Officer whose signature is on this Indenture or on the Note
Guaranty no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guaranty is endorsed, the Note Guaranty shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Note Guaranty set forth
in this Indenture on behalf of the Subsidiary Guarantors.
SECTION 12.03. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
(a) Except as set forth in Articles 4 and 5 hereof, nothing contained
in this Indenture shall prohibit a merger between a Subsidiary Guarantor and
another Subsidiary Guarantor or a merger between a Subsidiary Guarantor and the
Issuer.
(b) Except as provided in Section 12.03(a) hereof or in a transaction
referred to in Section 12.04 hereof, no Subsidiary Guarantor may consolidate
with or merge with or into (whether or not such Subsidiary Guarantor is the
surviving Person), another corporation, Person or entity whether or not
affiliated with such Subsidiary Guarantor unless, subject to the provisions of
the following paragraph, (i) the Person formed by or surviving any such
consolidation or merger (if other than such Subsidiary Guarantor) assumes all
the obligations of such Subsidiary Guarantor pursuant to a supplemental
indenture in form and substance reasonably satisfactory to the Trustee, under
the Notes and the Indenture; (ii) immediately after giving effect to such
transaction, no Default or Event of Default exists; (iii) the Issuer would be
permitted, immediately after giving effect to such transaction, to incur at
least $1.00 of additional Indebtedness pursuant to the Consolidated Interest
Coverage Ratio test set forth in the first
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paragraph of Section 4.09. The requirements of clause (iii) of this paragraph
will not apply in the case of a consolidation with or merger with or into any
other Person if the acquisition of all of the Equity Interests in such Person
would have complied with the provisions of Sections 4.07 and 4.09 hereof.
(c) In the case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and substantially in the form of Exhibit B
hereto, of the Note Guaranty endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Subsidiary Guarantor, such successor Person shall succeed to
and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Note Guaranties to be endorsed upon all
of the Notes issuable hereunder which theretofore shall not have been signed by
the Issuer and delivered to the Trustee. All of the Note Guaranties so issued
shall in all respects have the same legal rank and benefit under this Indenture
as the Note Guaranties theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Note Guaranties had been issued at
the date of the execution hereof.
SECTION 12.04. RELEASES FOLLOWING SALE OF ASSETS, MERGER, SALE OF CAPITAL
STOCK, ETC.
In the event (a) of a sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the capital
stock of any Subsidiary Guarantor or pursuant to a foreclosure, or (b) that the
Issuer designates a Subsidiary Guarantor to be an Unrestricted Subsidiary, or
such Subsidiary Guarantor ceases to be a Subsidiary of the Issuer, then such
Subsidiary Guarantor (in the event of a sale or other disposition, by way of
such a merger, consolidation or otherwise, of all of the capital stock of such
Subsidiary Guarantor or any such designation) or the entity acquiring the
property (in the event of a sale or other disposition of all of the assets of
such Subsidiary Guarantor) shall be released and relieved of any obligations
under its Note Guaranty; provided that the Net Proceeds of such sale or other
disposition are applied in accordance with the provisions of Sections 4.10 and
4.15 hereof. In the case of a sale, assignment, lease, transfer, conveyance or
other disposition of all or substantially all of the assets of a Subsidiary
Guarantor, upon the assumption provided for in clause (i) of Section 12.03(b)
hereof such Subsidiary Guarantor shall be discharged from all further liability
and obligation under the Indenture. Upon delivery by the Issuer to the Trustee
of an Officer's Certificate to the effect of the foregoing, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Subsidiary Guarantor from its Obligation under its Note Guaranty. Any
Subsidiary Guarantor not released from its Obligations under its Note Guaranty
shall remain liable for the full amount of principal of, premium, if any,
interest, if any, on the Notes and for the other Obligations of such Subsidiary
Guarantor under the Indenture as provided in this Article 12.
SECTION 12.05. ADDITIONAL SUBSIDIARY GUARANTORS.
Any Person that was not a Subsidiary Guarantor on the date of this
Indenture may become a Subsidiary Guarantor by executing and delivering to the
Trustee (a) a supplemental
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indenture in substantially the form of Exhibit C, and (b) an Opinion of Counsel
to the effect that such supplemental indenture has been duly authorized and
executed by such Person and constitutes the legal, valid, binding and
enforceable obligation of such Person (subject to such customary exceptions
concerning creditors' rights, fraudulent transfers, public policy and equitable
principles as may be acceptable to the Trustee in its discretion).
SECTION 12.06. LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.
Each Subsidiary Guarantor, and by its acceptance of Notes, each
Holder, hereby confirms that it is the intention of all such parties that the
Note Guaranty of such Subsidiary Guarantor not constitute a fraudulent transfer
or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Note Guaranty. To effectuate the foregoing
intention, the Trustee, the Holders and the Subsidiary Guarantors hereby
irrevocably agree that the obligations of such Subsidiary Guarantor under its
Note Guaranty and this Article 12 shall be limited to the maximum amount as
will, after giving effect to such maximum amount and all other contingent and
fixed liabilities of such Subsidiary Guarantor that are relevant under such
laws, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other Subsidiary Guarantor under
this Article 12, result in the obligations of such Subsidiary Guarantor under
its Note Guaranty not constituting a fraudulent transfer or conveyance.
SECTION 12.07. "TRUSTEE" TO INCLUDE PAYING AGENT.
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Issuer and be then acting hereunder, the term "Trustee" as
used in this Article 12 shall in each case (unless the context shall otherwise
require) be construed as extending to and including such Paying Agent within its
meaning as fully and for all intents and purposes as if such Paying Agent were
named in this Article 12 in place of the Trustee.
ARTICLE 13.
SUBORDINATION OF NOTE GUARANTY
SECTION 13.01. AGREEMENT TO SUBORDINATE.
The Subsidiary Guarantors agree, and each Holder by accepting a Note
irrevocably agrees, that all Guaranty Obligations shall be subordinated in right
of payment, to the extent and in the manner provided in this Article 13, to the
prior payment in full of all Guarantor Senior Debt, whether outstanding on the
date hereof or thereafter incurred and that the subordination is for the benefit
of the holders of Senior Debt.
SECTION 13.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any payment or distribution of assets of the Subsidiary
Guarantors of any kind or character, whether in cash, property or securities, to
creditors in any Insolvency or Liquidation Proceeding with respect to any
Subsidiary Guarantor, all amounts due or to become due under or with respect to
all Senior Debt (including Accrued Bankruptcy Interest and collateralization of
all Letter of Credit Obligations) shall first be paid in full before any
payment, repurchase of or
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distribution of assets is made on account of the Notes, except that the Holders
may receive Subsequent Reorganization Securities. Upon any such Insolvency or
Liquidation Proceeding, any payment or distribution of assets of any Subsidiary
Guarantor of any kind or character, whether in cash, property or securities
(other than Subsequent Reorganization Securities), to which the Holders of the
Notes or the Trustee would be entitled shall be paid by the Subsidiary
Guarantors or by any receiver, trustee-in-bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Holders of the
Notes or by the Trustee if received by them, directly to the holders of Senior
Debt (pro rata to such holders on the basis of the amounts of Senior Debt
(including Accrued Bankruptcy Interest and collateralization of all Letter of
Credit Obligations) held by such holders) or their Representative or
Representatives, as their interests may appear, for application to the payment
of the Senior Debt remaining unpaid until all such Senior Debt has been paid in
full, after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of Senior Debt.
SECTION 13.03. DEFAULT ON DESIGNATED SENIOR DEBT.
(a) In the event of and during the continuation of any default in the
payment of principal of, interest or premium, if any, on any Senior Debt, or any
Obligation owing from time to time under or in respect of Senior Debt, or in the
event that any event of default (other than a payment default) with respect to
any Senior Debt shall have occurred and be continuing and shall have resulted in
such Senior Debt becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, or (b) if any event of
default other than as described in clause (a) above with respect to any
Designated Senior Debt shall have occurred and be continuing permitting the
holders of such Designated Senior Debt (or their Representative or
Representatives) to declare such Designated Senior Debt due and payable prior to
the date on which it would otherwise have become due and payable, then no
payment shall be made by or on behalf of any Subsidiary Guarantor on account of
the Notes (other than payments in the form of Subsequent Reorganization
Securities) (x) in case of any payment or nonpayment default specified in (a),
unless and until such default shall have been cured or waived in writing in
accordance with the instruments governing such Senior Debt or such acceleration
shall have been rescinded or annulled, or (y) in case of any nonpayment event of
default specified in (b), during a Payment Blockage Period.
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SECTION 13.04. ACCELERATION OF NOTES.
If payment of the Notes is accelerated because of an Event of Default,
the Subsidiary Guarantor shall promptly notify such Representatives of Guarantor
Senior Debt of the acceleration.
SECTION 13.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If the Trustee or any Holder of a Note receives any payment or
distribution on account of any Obligations with respect to the Notes or
acquisition, repurchase, redemption, retirement or defeasance of any of the
Notes shall be made by or on behalf of the Company (including any payments or
distribution by any liquidating trustee or agent or other Person in a proceeding
referred to in Section 13.02) and received by the Trustee or any Holder at a
time when such payment or distribution was prohibited by the provisions of
Section 13.02 or 13.03 or such payment or distribution was required to be made
to holders of Senior Debt or their Representative, then, such payment or
distribution shall be received, segregated from other funds or assets and held
in trust by the Trustee or such Holder, as the case may be, for the benefit of,
and shall be promptly paid or delivered over to, the holders of Senior Debt or
their Representative, ratably in accordance with the respective amounts of the
principal of such Senior Debt, interest (including Accrued Bankruptcy Interest)
thereon and all other Obligations with respect thereto held or represented by
each, until the principal of all Senior Debt, interest (including Accrued
Bankruptcy Interest) thereon and all other Obligations with respect thereto have
been paid in full and all outstanding Letter of Credit Obligations have been
fully collateralized. Any distribution to the holders of Senior Debt or their
Representative of assets may be held by such holders or such Representatives as
additional collateral without any duty to any Holder to liquidate or otherwise
realize on such assets or to apply such assets to any Senior Debt or other
Obligations relating thereto.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically set
forth in this Article 13, and no implied covenants or obligations with respect
to the holders of Senior Debt 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 Debt, and shall not be liable to any such holders if the
Trustee shall pay over or distribute to or on behalf of Holders of the Notes or
the Issuer or any other Person money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 13, except if such payment is
made as a result of the willful misconduct or gross negligence of the Trustee.
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SECTION 13.06. NOTICE BY SUBSIDIARY GUARANTOR.
The Subsidiary Guarantors shall promptly notify the Trustee and the
Paying Agent of any facts known to the Subsidiary Guarantors that would cause a
payment of any Obligations with respect to the Notes to violate this Article 13,
but failure to give such notice shall not affect the subordination of the Notes
to the Senior Debt as provided in this Article 13.
SECTION 13.07. SUBROGATION.
After all Senior Debt (including Accrued Bankruptcy Interest) is paid
in full and until the Notes are paid in full, Holders of the Notes shall be
subrogated (equally and ratably with all Pari Passu Debt) to the rights of
holders of Senior Debt to receive distributions applicable to Senior Debt to the
extent that distributions otherwise payable to the Holders of the Notes have
been applied to the payment of Senior Debt. A distribution made under this
Article 13 to holders of Senior Debt that otherwise would have been made to
Holders of the Notes is not, as between the Subsidiary Guarantors and Holders of
the Notes, a payment by the Subsidiary Guarantors on the Notes.
SECTION 13.08. RELATIVE RIGHTS.
This Article defines the relative rights of Holders of the Notes and
holders of Senior Debt. Nothing in this Indenture shall:
(1) impair, as between the Issuer and Holders of the Notes, the
obligations of the Issuer, which are absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of the Notes and creditors
of the Issuer other than their rights in relation to holders of Senior Debt; or
(3) prevent the Trustee or any Holder of the Notes from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Debt to receive distributions and payments
otherwise payable to Holders of the Notes.
If the Issuer fails because of this Article 13 to pay principal of or
interest on a Note on the due date, the failure is still a Default or Event of
Default.
SECTION 13.09. SUBORDINATION MAY NOT BE IMPAIRED BY SUBSIDIARY GUARANTOR.
No right of any holder of Senior Debt to enforce the subordination of
the Indebtedness evidenced by the Notes shall be impaired by any act or failure
to act by the Issuer or any Holder or by the failure of the Issuer or any Holder
to comply with this Indenture.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt, or any of them, may, at any time and from time to
time, without the consent of or notice to the Holders of the Notes, without
incurring any liabilities to any Holder of any Notes and without impairing or
releasing the subordination and other benefits provided in this
-77-
Indenture or the obligations of the Holders of the Notes to the holders of the
Senior Debt, even if any right of reimbursement or subrogation or other right or
remedy of any Holder is affected, impaired or extinguished thereby, do any one
or more of the following:
(1) change the manner, place or terms of payment or change or extend
the time of payment of, or renew, exchange, amend, increase or alter, the terms
of any Senior Debt, any security therefor or guaranty thereof or any liability
of any obligor thereon (including any guarantor) to such holder, or any
liability incurred directly or indirectly in respect thereof or otherwise amend,
renew, exchange, extend, modify, increase or supplement in any manner any Senior
Debt or any instrument that evidences or guaranties or secures the same or any
agreement under which Senior Debt is outstanding;
(2) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and in any order any property pledged,
mortgaged or otherwise securing Senior Debt or any liability of any obligor
thereon, to such holder, or any liability incurred directly or indirectly in
respect thereof;
(3) settle or compromise any Senior Debt or any other liability of any
obligor of the Senior Debt to such holder or any security therefor or any
liability incurred directly or indirectly in respect thereof and apply any sums
by whomsoever paid and however realized to any liability (including, without
limitation, Senior Debt) in any manner or order; and
(4) fail to take or to record or to otherwise perfect, for any reason
or for no reason, any lien or security interest securing Senior Debt by
whomsoever granted, exercise or delay in or refrain from exercising any right or
remedy against any obligor or any guarantor or any other Person, elect any
remedy and otherwise deal freely with any obligor and any security for the
Senior Debt or any liability of any obligor to such holder or any liability
incurred directly or indirectly in respect thereof, it being acknowledged that
the Notes are not entitled to the benefit of any collateral or assets owned by
or purported to be owned by the Issuer or any of its Subsidiaries and pledged to
or purported to be pledged to the Credit Agent for the benefit of the holders of
Indebtedness under the New Credit Facility, until the payment in full of such
Designated Senior Debt and the termination of all commitments thereunder.
SECTION 13.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Debt, the distribution may be made and the notice given to their
Representative.
Upon any payment or distribution of assets of the Issuer referred to
in this Article 13, the Trustee and the Holders of the Notes shall be entitled
to rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
of the Notes for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Debt and other Indebtedness of
the Issuer, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 13.
-78-
SECTION 13.11. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 13 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless the Trustee shall have received at its
Corporate Trust Office at least three Business Days prior to the date of such
payment written notice of facts that would cause the payment of any Obligations
with respect to the Notes to violate this Article; and, prior to the receipt of
any such written notice, the Trustee shall be entitled to assume that no such
facts exist; provided, however, that if the Trustee shall not have received such
written notice prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of, premium, if any, or interest on any Note or other Obligations
under this Indenture), then, anything herein contained to the contrary
notwithstanding, but without limiting the rights and remedies of the holders of
Senior Debt or any trustee, fiduciary or agent thereof, the Trustee shall have
full power and authority to receive such money and to apply the same to the
purpose for which such money and to apply the same to the purpose for which such
money was received and shall not be affected by any notice to the contrary which
may be received by it after such date, nor shall the Trustee be charged with
knowledge of the curing of any such default or the elimination of the act or
condition preventing any such payment unless and until the Trustee shall have
received an Officer's Certificate to such effect. Only the Issuer or a
Representative may give the notice. Nothing in this Article 13 shall impair the
claims of, or payments to, the Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Debt with the same rights it would have if it were not Trustee. Any Agent may do
the same with like rights.
SECTION 13.12. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Note by the Holder's acceptance thereof authorizes
and directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 13, and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes, including without limitation the timely filing of a
claim for the unpaid balance of the Notes held by such Holder in the form
required in any Insolvency or Liquidation Proceeding and causing such claim to
be approved. If the Trustee does not file a proper proof of claim or proof of
debt in the form required in any proceeding referred to in Section 6.09 hereof
at least 30 days before the expiration of the time of such claim, the
Representatives of the Designated Senior Debt, including the Credit Agent, are
hereby authorized to file an appropriate claim for and on behalf of the Holders
of the Notes.
SECTION 13.13. AMENDMENTS.
Any amendment to the provisions of this Article 13 shall require the
consent of the holders of all of the Senior Debt (or the Representatives of such
holders, as applicable) whose rights would be adversely affected by such
amendment.
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ARTICLE 14.
MISCELLANEOUS
SECTION 14.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss. 318(c), the imposed duties shall control.
SECTION 14.02. NOTICES.
Any notice or communication by the Issuer, the Subsidiary Guarantors
or the Trustee to the others is duly given if in writing and delivered in person
or mailed by first class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery,
to the others' address:
If to the Issuer or the Subsidiary Guarantors:
AMF Bowling Worldwide, Inc.
0000 XXX Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
With a copy to:
McGuireWoods LLP
One Xxxxx Center
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx, III
If to the Trustee:
Wilmington Trust Company
Xxxxxx Square North
0000 X. Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
With a copy to:
-80-
Xxxxx Xxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Bart Piscella
The Issuer, the Subsidiary Guarantors or the Trustee, by notice to the
others may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five (5) Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier promising next Business Day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail or by overnight air courier promising next Business Day delivery to its
address shown on the register kept by the Registrar. Any notice or communication
shall also be so mailed to any Person described in TIA ss. 313(c), to the extent
required by the TIA. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Issuer mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
SECTION 14.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Issuer, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
SECTION 14.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Issuer or the Subsidiary
Guarantors to the Trustee to take any action under this Indenture (other than
the initial issuance of the Notes), such Issuer or Subsidiary Guarantor shall
furnish to the Trustee upon request:
(a) an Officer's Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 14.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
-81-
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 14.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
SECTION 14.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
SECTION 14.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 14.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No director, officer, employee, partner, incorporator or stockholder
of the Issuer or any of their Restricted Subsidiaries, as such, shall have any
liability for any obligations of the Issuer or any Subsidiary Guarantor under
the Notes, this Indenture, the Note Guaranties or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
SECTION 14.08. GOVERNING LAW.
The law of the State of New York shall govern and be used to construe
this Indenture, the Notes and the Note Guaranties without giving effect to any
contrary result otherwise required by applicable conflict or choice of law
rules.
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SECTION 14.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Issuer or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 14.10. SUCCESSORS.
All covenants and agreements of the Issuer and the Subsidiary
Guarantors in this Indenture, the Notes and the Note Guaranties shall bind its
successors and assigns. All covenants and agreements of the Trustee in this
Indenture shall bind its successors and assigns.
SECTION 14.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby
and in lieu of such invalid, illegal or unenforceable provision, a new provision
shall be inserted as similar in terms and commercial effect to such invalid,
illegal or unenforceable provision as may be possible and be valid, legal and
enforceable.
SECTION 14.12. 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 14.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
[The next page is the signature page]
-83-
SIGNATURES
Issuer
AMF BOWLING WORLDWIDE, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Senior Vice President, Chief Financial
Officer and Treasurer
Subsidiary Guarantors
AMF BOWLING CENTERS HOLDINGS
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF WORLDWIDE BOWLING
CENTERS HOLDINGS INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BOWLING PRODUCTS, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Senior Vice President, Assistant Secretary
and Treasurer
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AMF BOWLING CENTERS, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMERICAN RECREATION CENTERS,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BEVERAGE COMPANY OF
OREGON, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BEVERAGE COMPANY OF X.XX.,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
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XXXX RIVER CORPORATION
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
300, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Authorized Agent
XXXX XXXXX LENEXA, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BOWLING CENTERS (AUST.)
INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BOWLING CENTERS
INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Vice President, Assistant Secretary
and Treasurer
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AMF BOWLING MEXICO HOLDING,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
BOLICHES AMF, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
AMF BOWLING CENTERS (HONG
KONG) INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary
and Treasurer
XXXXXXX XXXXXX GOLF COMPANY,
INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
MJG - X'XXXX, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-UK ONE, INC.
By _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-UK TWO, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-FRANCE ONE, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-FRANCE TWO, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING HOLDINGS INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING CENTERS SPAIN INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
WILMINGTON TRUST COMPANY
By:
------------------------------------------------
Name:
Title:
-87-
SCHEDULE A
SUBSIDIARY GUARANTORS
AMF Bowling Products, Inc.
AMF Bowling Centers Holdings Inc.
AMF Bowling Holdings Inc.
AMF Worldwide Bowling Centers Holdings Inc.
American Recreation Centers, Inc.
AMF Bowling Centers, Inc.
AMF Beverage Company of Oregon, Inc.
AMF Beverage Company of W. VA., Inc.
Xxxx Xxxxx Lenexa, Inc.
300, Inc.
Xxxx River Corporation
Xxxxxxx Xxxxxx Golf Company, Inc.
MJG-X'Xxxx, Inc.
AMF Bowling Centers (Aust) International Inc.
AMF Bowling Centers (Hong Kong) International Inc.
AMF Bowling Centers International Inc.
AMF Bowling Mexico Holding, Inc.
Boliches AMF, Inc.
AMF BCO-UK One, Inc.
AMF BCO-UK Two, Inc.
AMF BCO-France One, Inc.
AMF BCO-France Two, Inc.
AMF Bowling Centers Spain Inc.
EXHIBIT A
(Face of Senior Subordinated Note)
This Note has not been registered under the United States Securities Act of
1933, as amended (the "Securities Act"), and this Note may not be offered, sold,
pledged or otherwise transferred except pursuant to an effective registration
statement or in accordance with an applicable exemption from the registration
requirements of the Securities Act (subject to the delivery of such evidence, if
any, required under the indenture pursuant to which this Note is issued) and in
accordance with any applicable securities laws of any state of the United States
or any other jurisdiction.1
13.00% Senior Subordinated Note due 2008
No. __ $____________________
CUSIP NO. 030985 AG 0
AMF BOWLING
WORLDWIDE, INC.
promises to pay to _________, or registered assigns, the principal sum of
$____________ Dollars on August 28, 2008.
Interest Payment Dates: February 28 and August 28.
Record Dates: February 15 and August 15.
Dated: February 28, 2002
AMF BOWLING WORLDWIDE, INC.
By:
----------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Senior Vice President, Chief
Financial Officer and Treasurer
This is one of the Senior
Subordinated Notes referred to in
the within-mentioned Indenture:
WILMINGTON TRUST COMPANY
as Trustee
---------------------------------
(1) This legend should be imprinted only on Notes issued to Persons deemed to be
"underwriters" and ineligible to benefit from the Bankruptcy Code Section 1145
exceptions to the Securities Act registration requirements.
A-1
By:
-------------------------------------
(Authorized Signatory)
A-2
(Back of Senior Subordinated Note)
13.00% Senior Subordinated Notes due 2008
THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF
THE ISSUER.2
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. AMF Bowling Worldwide, Inc., a Delaware corporation, or its
successors (the "Issuer"), promises to pay interest on the principal amount of
this Note at the rate of 13.00% per annum. The Issuer will pay interest in
United States dollars (except as otherwise provided herein) semi-annually in
arrears on February 28 and August 28, commencing on August 28, 2002, or if any
such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes shall accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided however, that if there is no existing
Default or Event of Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date, except in the case of the original issuance of
Notes, in which case interest shall accrue from the date of authentication. The
Issuer shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum
in excess of the then applicable interest rate on the Notes to the extent
lawful; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
2. METHOD OF PAYMENT. The Issuer will pay interest on the Notes (except
defaulted interest), if any, to the Persons who are registered Holders at the
close of business on the February 15 or August 15 next preceding the Interest
Payment Date, even if such Notes are cancelled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes shall be payable as to
principal, premium, if any, and interest, at the office or agency of the Issuer
maintained for such purpose within or without the City and State of New York,
or, at the option of the Issuer, payment of interest may be made by check mailed
to the Holders at their addresses set forth in the register of Holders; provided
that payment by wire transfer of immediately available funds
-------------------------------------
(2) This paragraph should be included only if the Note is issued as Global
Notes.
A-3
shall be required with respect to principal of, and interest, premium, if any,
on, all Global Notes and all other Notes the Holders of which shall have
provided written wire transfer instructions to the Issuer or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, Wilmington Trust Company, the Trustee
under the Indenture, shall act as Paying Agent and Registrar. The Issuer may
change any Paying Agent or Registrar without notice to any Holder. The Issuer or
any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Issuer issued the Notes under an Indenture dated as of
February 28, 2002 (the "Indenture") among the Issuer, the Subsidiary Guarantors
and the Trustee. The terms of the Notes include those stated in the Indenture
and those made a part of the Indenture by reference to the Trust Indenture Act
of 1939, as amended (15 U.S. Code xx.xx. 77aaa-77bbbb) (the "TIA"). The Notes
are subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. The Notes are general unsecured
Obligations of the Issuer limited to $150,000,000 in aggregate principal amount.
5. OPTIONAL REDEMPTION. (a) Except as set forth in the next paragraph, the Notes
shall not be redeemable at the Issuer's option prior to February 28, 2005.
Thereafter, the Notes shall be redeemable at the option of the Issuer, in whole
or in part, at any time upon not less than 30 nor more than 60 days' notice, at
the redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest, if any, to the applicable redemption
date, if redeemed during the twelve-month period beginning on February 28 of the
years indicated below:
Year Percentage
2005.................................................... 106.5%
2006.................................................... 103.25%
2007 and thereafter..................................... 100.00%
(b) Notwithstanding the foregoing: (i) at any time prior to February
28, 2005, the Issuer may on any one or more occasions redeem up to 35 % of the
initially outstanding aggregate principal amount of Notes at a redemption price
equal to 113.00% of the principal amount thereof, plus accrued and unpaid
interest, if any, thereon to the redemption date, with the cash proceeds of one
or more Public Equity Offerings; provided that, in each case, at least 65% of
the initially outstanding aggregate principal amount of Notes remains
outstanding immediately after the occurrence of such redemption; and provided,
further, that such redemption shall occur within 75 days of the date of the
closing of such Public Equity Offering; and (ii) at any time within 75 days
after the occurrence of a Change of Control, the Issuer may, but shall in no
event be required to, redeem 100% but not less than 100% of the outstanding
Notes at a redemption price equal to the lower of 110.00% of the principal
amount thereof and the amount at which the Issuer could redeem the Notes
pursuant to Section 5(a) hereof, plus accrued and unpaid interest, if any,
thereon to the redemption date.
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6. MANDATORY REDEMPTION. The Issuer shall not be required to make mandatory
redemption or sinking fund payments with respect to the Notes, provided that
this paragraph 6 shall not be deemed to affect the obligations of the Issuer
pursuant to Section 4.10 or 4.15 of the Indenture.
7. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least 30 days
but not more than 60 days before the redemption date to each Holder whose Notes
are to be redeemed at its registered address. Notes in denominations larger than
$1,000 may be redeemed in part but only in whole multiples of $1,000, unless all
of the Notes held by a Holder are to be redeemed. On and after the redemption
date, interest, if any, ceases to accrue on the Notes or portions thereof called
for redemption, unless the Issuer defaults in making such redemption payment.
8. SUBORDINATION. The Notes are subordinated to Senior Debt, which is all
Indebtedness and other Obligations specified below payable directly or
indirectly by the Issuer or any of its Restricted Subsidiaries, whether
outstanding on the date of the Indenture or thereafter created, incurred or
assumed by the Issuer or any of its Restricted Subsidiaries: (i) the principal
of, interest on and all other Obligations related to the New Credit Facility
(including without limitation all loans, letters of credit and other extensions
of credit under the New Credit Facility, and all expenses, fees, reimbursements,
indemnities and other amounts owing pursuant to the New Credit Facility); (ii)
amounts payable in respect of any Hedging Obligations; (iii) all Indebtedness
not prohibited by Section 4.09 of the Indenture that is not expressly pari passu
with or subordinated to the Notes, and (iv) all permitted renewals, extensions,
refundings or refinancings thereof. Notwithstanding anything to the contrary in
the foregoing, Senior Debt will not include (i) Indebtedness of the Issuer or
any of its Restricted Subsidiaries to any other Restricted Subsidiary which is
not a Subsidiary Guarantor, (ii) any Indebtedness which by the express terms of
the agreement or instrument creating, evidencing or governing the same is junior
or subordinate in right of payment to any item of Senior Debt, (iii) any trade
payable arising from the purchase of goods or materials or for services obtained
in the ordinary course of business, or (iv) Indebtedness incurred in violation
of the Indenture. To the extent provided in the Indenture, Senior Debt must be
paid before the Notes may be paid. The Issuer agrees, and each Holder by
accepting a Note consents and agrees, to the subordination provided in the
Indenture and authorizes the Trustee to give it effect.
9. PURCHASE AT OPTION OF HOLDER.
(a) If there shall at any time or times occur a Change of Control Triggering
Event, then the Issuer shall notify the Holders in writing of such occurrence
and shall make an offer to purchase (the "Change of Control Offer"), not later
than five Business Days after the termination of the Offer Period (the "Purchase
Date"), all Notes then outstanding at a purchase price equal to 101% of the
principal amount thereof outstanding plus accrued and unpaid interest, if any,
to the Purchase Date.
(b) The Issuer shall provide the Trustee with notice of the Change of Control
Offer at least 60 days before any such Change of Control Payment Date and at
least 10 days before the notice of any Change of Control Offer is mailed to
Holders. Notice of a Change of Control Offer shall be mailed by the Issuer not
less than 45 days or more than 60 days before the Change of Control
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Payment Date to the Holders at their last registered addresses with a copy to
the Trustee and the Paying Agent. The Change of Control Offer shall remain open
from the time of mailing until five days before the Change of Control Payment
Date. The notice shall contain all instructions and materials necessary to
enable such Holders to tender Notes pursuant to the Change of Control Offer,
pursuant to the procedures required by the Indenture.
(c) Pursuant to Section 4.15 of the Indenture, holders of the Notes that are the
subject of an offer to purchase will receive a Change of Control Offer from the
Issuer prior to any related purchase date and may elect to have such Notes
purchased by completing the form titled "Option of Holder to Elect Purchase"
appearing below.
10. ASSET SALES Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, the Issuer may apply such Net Proceeds at its option, (a) to repay
Senior Debt, (b) to secure Letter of Credit Obligations to the extent letters of
credit have not been drawn upon or returned unwithdrawn, (c) to the acquisition
of assets to be used in a Permitted Business and/or (d) to an investment in
properties or assets that replace the properties and assets that are the subject
of such Asset Sale and/or, in the case of a sale of a bowling center or bowling
centers, may deem such Net Proceeds to have been applied pursuant to this clause
(d) to the extent of any expenditures made to acquire, renovate, expand or
construct one or more bowling centers within 365 days preceding the date of the
Asset Sale. Pending the final application of any such Net Proceeds, the Issuer
may temporarily reduce the New Credit Facility or otherwise invest such Net
Proceeds in any manner that is not prohibited by this Indenture. Any Net
Proceeds from Asset Sales that are not applied or invested as provided in the
first sentence of this paragraph will be deemed to constitute "Excess Proceeds."
When the aggregate amount of Excess Proceeds exceeds $25.0 million, the Issuer
shall be required to make an offer to all Holders (an "Asset Sale Offer") to
purchase the maximum principal amount of Notes that may be purchased out of the
Excess Proceeds, at an offer price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest, if any, thereon to
the date of purchase, in accordance with the procedures set forth in Section
3.09 of the Indenture. To the extent that the aggregate amount of Notes tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Issuer may
use any remaining Excess Proceeds for general corporate purposes. If the
aggregate principal amount of Notes surrendered by Holders thereof exceeds the
amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on
a pro rata basis; provided, however, that the Issuer shall not be obligated to
purchase Notes in denominations other than integral multiples of $1,000. Upon
completion of such offer to purchase, the amount of Excess Proceeds shall be
reset at zero.
11. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without
coupons. The transfer of the Notes may be registered and the Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Issuer may require a Holder to pay any taxes and fees
required by law or permitted by the Indenture. The Issuer need not exchange or
register the transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part. Also, it
need not exchange or register the transfer of any Notes for a period of 15 days
before the mailing of a notice of redemption of Notes or during the period
between a record date and the corresponding interest payment date. Definitive
Notes shall be in denominations of $1,000 and integral
A-6
multiples thereof, except as otherwise permitted pursuant to Section 2.06(d)(ix)
of the Indenture. Participants and Indirect Participants may hold beneficial
interests in the Global Note in denominations of $1.00 and integral multiples
thereof, provided, however, that each Note or Notes issued upon any registration
or transfer or exchange of any Note, or pursuant to Section 2.10 or Section 3.06
of the Indenture, shall be issued in denominations of $1,000 or integral
multiples thereof, except that not more than one (1) new Note so being issued in
respect of the Note being surrendered (the "surrendered Note") may be in a
denomination that is not $1,000 or an integral multiple thereof. Notes may not
be surrendered for combination into a Note with a principal amount that is not
$1,000 or an integral multiple thereof.
12. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its
owner for all purposes, subject to the provisions of the Indenture and the Notes
relating to record dates for the payment of interest.
13. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to the following paragraphs, the
Indenture and the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the Notes then outstanding
(including consents obtained in connection with a tender offer or exchange offer
for the Notes), and any existing Default or Event of Default (other than a
Default or Event of Default in the payment of the principal of, premium, if any,
or interest on the Notes, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including consents
obtained in connection with a tender offer or exchange offer for the Notes). In
addition, any amendment to Article 11 or Article 13 of the Indenture requires
the consent of the holders of all Senior Debt (or the Representatives of such
holders, as applicable) whose rights would be adversely affected by such
amendment.
Without the consent of any Holder, the Issuer and the Trustee may
amend or supplement the Indenture or the Notes: to cure any ambiguity, defect or
inconsistency; to provide for uncertificated Notes in addition to or in place of
certificated Notes; to provide for the assumption and discharge of the Issuer's
and the Subsidiary Guarantors' obligations to Holders in the case of a merger or
consolidation pursuant to Article 5 or Article 12 of the Indenture, as
applicable; to make any change that would provide any additional rights or
benefits to the Holders or that does not adversely affect the legal rights under
the Indenture of any such Holder; to comply with requirements of the Commission
in order to effect or maintain the qualification of the Indenture under the TIA;
or to allow any Subsidiary Guarantor to Guaranty the Notes.
14. DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in
the payment when due of interest on the Notes (whether or not prohibited by the
subordination provisions of the Indenture); (ii) default in payment when due of
the principal of or premium, if any, on the Notes (whether or not prohibited by
the subordination provisions of the Indenture); (iii) failure of the Issuer for
30 days after notice to comply with Section 4.10 or 4.15 or Article 5 of the
Indenture; (iv) failure of the Issuer for 60 days after notice to comply with
any of their other agreements in the Indenture or the Notes; (v) default under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed by
the Issuer or any of its Restricted Subsidiaries (or the payment of which is
Guaranteed by the Issuer or any of its Restricted Subsidiaries) whether such
A-7
Indebtedness or Guaranty now exists, or is created after the date of the
Indenture, which default is caused by a failure to pay principal at final
maturity or results in the acceleration of such Indebtedness prior to its Stated
Maturity and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness the Stated
Maturity of which has been so accelerated, aggregates $25.0 million or more;
(vi) failure by the Issuer or its Significant Subsidiaries to pay final
judgments aggregating in excess of $25.0 million, which judgments are not paid,
discharged or stayed for a period of 60 days after entry thereof; or (vii)
certain events of bankruptcy or insolvency with respect to the Issuer or any of
its Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary.
15. TRUSTEE DEALINGS WITH THE ISSUER. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuer, the Subsidiary Guarantors or its Affiliates, and may otherwise
deal with the Issuer, the Subsidiary Guarantors or its Affiliates, as if it were
not the Trustee.
16. NO RECOURSE AGAINST OTHERS. No director, officer, employee, partner,
incorporator or stockholder of the Issuer or any of their Restricted
Subsidiaries, as such, shall have any liability for any obligations of the
Issuer or any Subsidiary Guarantor under the Notes, the Indenture, the Note
Guaranties or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
17. AUTHENTICATION. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
18. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by
the entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Issuer has caused CUSIP numbers
to be printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to the Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
The Issuer shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to:
AMF Bowling Worldwide, Inc.
0000 XXX Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Secretary
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[Balance of page intentionally remains blank]
A-9
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
------------------------------------------------------------------------------
(Insert assignee's Soc. Sec. or Tax I.D. No.)
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
---------------------------------------------------------
to transfer this Note on the books of the Issuer. The agent may substitute
another to act for him.
------------------------------------------------------------------------------
Date:
-------------------------------
Your Signature:
--------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
* Signature must be guaranteed by an eligible guarantor institution
within the meaning of Securities and Exchange Commission Rule 17Ad-15
(includingbanks, stock brokers, savings and loan associations, national
securities exchanges, registered securities associations, clearing agencies
and credit unions) with membership or participation in an approved
signature guarantee medallion program if this Note is to be delivered other
than to, and in the name of, the registered holder.
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer
pursuant to Section 4.15 of the Indenture, check the following box. [ ]
If you want to elect to have only part of the Note purchased by the
Issuer pursuant to Section 4.15 of the Indenture, state the amount you elect to
have purchased:
$
------------
Date: Your Signature:
------------------------------- -------------------------
(Sign exactly as your name appears
on the Note)
Tax Identification No.:
-----------------
Signature Guarantee.*
* Signature must be guaranteed by an eligible guarantor institution within
the meaning of Securities and Exchange Commission Rule 17Ad-15 (including
banks, stock brokers, savings and loan associations, national securities
exchanges, registered securities associations, clearing agencies and credit
unions) with membership or participation in an approved signature guarantee
medallion program if this Note is to be delivered other than to, and in the
name of, the registered holder.
A-11
SCHEDULE OF EXCHANGES OF NOTES(3)
The following exchanges of a part of this Global Note for other Notes
have been made:
-------------------------------------------------------------------------------
Principal Amount
Amount of Amount of of this Signature of
decrease in increase in Global Note authorized
Principal Principal following signatory
Date of Amount of Amount of this such decrease of Trustee or
Exchange this Global Note Global Note (or increase) Note Custodian
-------------------------------------------------------------------------------
-----------------------
(3) This should only be included if the Note is issued as Global Note
A-12
EXHIBIT B
SUBSIDIARY GUARANTY
Subject to Section 12.06 of the Indenture, each Subsidiary Guarantor
hereby, jointly and severally, unconditionally guaranties to each Holder of a
Note authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of the
Indenture, the Notes and the Obligations of the Issuer under the Notes or under
the Indenture, that: (a) the principal of, premium, if any, and interest, if
any, on the Notes will be promptly paid in full when due, subject to any
applicable grace period, whether at maturity, by acceleration, redemption or
otherwise, and interest on overdue principal, premium, if any (to the extent
permitted by law), interest on any interest, if any, on the Notes and all other
payment Obligations of the Issuer to the Holders or the Trustee under the
Indenture or under the Notes will be promptly paid in full and performed, all in
accordance with the terms thereof; and (b) in case of any extension of time of
payment or renewal of any Notes or any of such other payment Obligations, the
same will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, subject to any applicable grace period,
whether at stated maturity, by acceleration, redemption or otherwise. Failing
payment when so due of any amount so guaranteed for whatever reason, the
Subsidiary Guarantors will be jointly and severally obligated to pay the same
immediately.
The obligations of the Subsidiary Guarantor to the Holders and to the
Trustee pursuant to this Subsidiary Guaranty and the Indenture are expressly set
forth in Article 12 of the Indenture, and reference is hereby made to such
Indenture for the precise terms of this Subsidiary Guaranty. The terms of
Article 12 of the Indenture are incorporated herein by reference. This
Subsidiary Guaranty is subject to release as and to the extent provided in
Section 12.04 of the Indenture.
This is a continuing Guaranty and shall remain in full force and
effect and shall be binding upon each Subsidiary Guarantor and its successors
and assigns to the extent set forth in the Indenture until full and final
payment of all of the Issuer's Obligations under the Notes and the Indenture and
shall inure to the benefit of the successors and assigns of the Trustee and the
Holders and, in the event of any transfer or assignment of rights by any Holder
or the Trustee, the rights and privileges herein conferred upon that party shall
automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions hereof. This is a Subsidiary Guaranty of
payment and not a guarantee of collection.
This Subsidiary Guaranty shall not be valid or obligatory for any
purpose until the certificate of authentication on the Note upon which this
Subsidiary Guaranty is noted shall have been executed by the Trustee under the
Indenture by the manual signature of one of its authorized officers.
The Subsidiary Guarantor, and by its acceptance of Notes, each Holder,
hereby confirms that it is the intention of all such parties that the Note
Guaranty of the Subsidiary Guarantor not constitute a fraudulent transfer or
conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Note Guaranty. To effectuate the foregoing
intention, the Trustee, the Holders and the Subsidiary Guarantor hereby
irrevocably agree that the obligations
B-1
of the Subsidiary Guarantor under the Note Guaranty and Article 12 of the
Indenture shall be limited to the maximum amount as will, after giving effect to
such maximum amount and all other contingent and fixed liabilities of the
Subsidiary Guarantor that are relevant under such laws, and after giving effect
to any collections from, rights to receive contribution from or payments made by
or on behalf of any other Subsidiary Guarantor in respect of the obligations of
such other Subsidiary Guarantor under Article 12 of the Indenture, result in the
obligations of the Subsidiary Guarantor under the Note Guaranty not constituting
a fraudulent transfer or conveyance.
Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
Dated as of February 28, 2002
AMF BOWLING CENTERS HOLDINGS
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF WORLDWIDE BOWLING
CENTERS HOLDINGS INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING PRODUCTS, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Senior Vice President, Assistant Secretary
and Treasurer
AMF BOWLING CENTERS, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMERICAN RECREATION CENTERS,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BEVERAGE COMPANY OF
OREGON, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BEVERAGE COMPANY OF X.XX.,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
XXXX RIVER CORPORATION
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
300, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Authorized Agent
XXXX XXXXX LENEXA, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING CENTERS (AUST.)
INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING CENTERS
INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
Vice President, Assistant Secretary
and Treasurer
AMF BOWLING MEXICO HOLDING,
INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
BOLICHES AMF, INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING CENTERS (HONG
KONG) INTERNATIONAL INC.
By:
------------------------------------------------
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
XXXXXXX XXXXXX GOLF COMPANY,
INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
MJG - X'XXXX, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-UK ONE, INC.
By _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-UK TWO, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-FRANCE ONE, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BCO-FRANCE TWO, INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING HOLDINGS INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
AMF BOWLING CENTERS SPAIN INC.
By: _________________________________
Xxxxxxxxxxx X. Xxxxxx,
President, Assistant Secretary and Treasurer
B-2
EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
__________ __, 200__ between Subsidiary Guarantor (the "New Subsidiary
Guarantor"), a direct or indirect domestic Restricted Subsidiary of AMF Bowling
Worldwide, Inc. (the "Issuer") and Wilmington Trust Company, as trustee under
the indenture referred to below (the "Trustee"). Capitalized terms used herein
and not defined herein shall have the meaning ascribed to them in the Indenture
(as defined below).
WITNESSETH
WHEREAS, the Issuer has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of February 28, 2002, providing
for the issuance of an aggregate principal amount of $150,000,000 of 13.00%
Senior Subordinated Notes due 2008 (the "Notes");
WHEREAS, Section 12.05 of the Indenture provides that under certain
circumstances the Issuer may cause, and Section 12.03 of the Indenture provides
that under certain circumstances the Issuer must cause, certain of its
subsidiaries to execute and deliver to the Trustee a supplemental indenture
pursuant to which such subsidiaries shall unconditionally guarantee all of the
Issuer's Obligations under the Notes pursuant to a Note Guaranty on the terms
and conditions set forth herein; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the New
Subsidiary Guarantor and the Trustee mutually covenant and agree for the equal
and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO NOTE GUARANTY. The New Subsidiary Guarantor hereby
agrees, jointly and severally with all other Subsidiary Guarantors, to guarantee
the Issuer's Obligations under the Notes and the Indenture on the terms and
subject to the conditions set forth in Article 12 and Article 13 of the
Indenture and to be bound by all other applicable provisions of the Indenture.
3. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, shareholder or agent of any Subsidiary
Guarantor, as such, shall have any liability for any obligations of the Issuer
or any Subsidiary Guarantor under the Notes, any Note Guaranties, the Indenture
or this Supplemental Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
C-1
4. NEW YORK LAW TO GOVERN. The law of the State of New York shall
govern and be used to construe this Supplemental Indenture, without giving
effect to any contrary result otherwise required under applicable conflict or
choice-of-law rules.
5. COUNTERPARTS The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
6. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
7. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the correctness of the recitals of fact
contained herein, all of which recitals are made solely by the New Subsidiary
Guarantor.
8. EFFECT OF SUPPLEMENTAL INDENTURE. Except as amended by this
Supplemental Indenture, the terms and provisions of the Indenture shall remain
in full force and effect.
C-2
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture
to be duly executed and attested, all as of the date first above written.
Dated: _____________ [NAME OF NEW SUBSIDIARY GUARANTOR]
By:
---------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
-----------------------------------------
Name:
Title:
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